Labor Department Sues Wisconsin Trustee Over Misuse of Profit-Sharing Assets

Archived News Release — Caution: Information may be out of date.

Chicago, Illinois - The U.S. Department of Labor filed an adversary complaint on July 11 to prevent the owner of Sure-Tite Roofing, Inc. of Chippewa Falls, Wisconsin from discharging debts owed to the company’s profit sharing plan in his Chapter 7 bankruptcy proceeding.

The bankruptcy filing alleges that Robert Louis Starkmann, the owner of Sure-Tite and a trustee of the profit sharing plan, diverted $5,031.61 in employees' contributions to pay the general operating expenses of the company. The bankruptcy filing further alleges that Starkmann, who filed for personal bankruptcy on March 28, failed to timely remit $7,618.77 in employee contributions to the plan. The department also filed a lawsuit in federal district court in the Western District of Wisconsin on July 9 against Starkmann and the company for diverting the plan assets to pay corporate expenses and failing to secure a fidelity bond as required by federal pension law.

The civil lawsuit seeks to have the court permanently bar Sure-Tite and Starkmann from serving as fiduciaries to ERISA-covered plans, to prevent them from committing future violations of the federal pension law, to secure a fidelity bond and to offset Starkmann’s own account for the amount he owes the plan’s other participants because of his fiduciary breaches.

Sure-Tite, a Subchapter S corporation, employed 12 people until October 2000 when they were terminated because of the company’s financial problems. Since then, Sure-Tite has ceased all operations. The company’s plan had 10 participants and $16,146.62 in assets as of December 31, 2000.

The Chicago Regional Office of the department’s Pension and Welfare Benefits Administration conducted the investigation leading to the lawsuit.

(Chao v. Sure-Tite Roofing, Inc., and Robert Louis Starkmann
Civil Action No. 01 C 0391S)
(Chao v. Robert Louis Starkmann in U.S. Bankruptcy Court
Civil Action No. N. 01-11623-7 Chapter 7)

U.S. Department of Labor news releases are accessible on the Internet. The information in this news release will be made available in alternate format upon request (large print, Braille, audio tape or disc) from the Central Office for Assistive Services and Technology. Please specify which news release when placing your request. Call 202.693.7773 or TTY 202.693.7775.

Archived News Release — Caution: Information may be out of date.