Labor Department Sues Delmont, Pennsylvania, Sewer Installation Company For Pension Plan Violations

Archived News Release — Caution: Information may be out of date.

Philadelphia, Pennsylvania - The U.S. Department of Labor has sued Lomik Construction Corporation, Delmont, Pennsylvania, and its president, Michael Rizzi, for violations of the Employee Retirement Income Security Act.

The lawsuit alleges that the company and Rizzi, as trustee of the 401(k) profit sharing plan, failed to forward or timely remit plan contributions deducted from employees’ paychecks from January 2002 through October 2004. In a separate action filed in bankruptcy court, the department alleges Rizzi’s debt is non-dischargeable and must be paid, even though he filed October 6 for protection under Chapter 11.

“This legal action should put employers and plan sponsors on notice that we will not hesitate to resort to litigation to enforce the law and ensure that workers receive the benefits to which they are entitled,” said Mabel Capolongo, regional director of the department’s Philadelphia office of the Employee Benefits Security Administration (EBSA).

The suit seeks a court order to remove Rizzi and the company as plan fiduciaries; require them to restore any losses to the plan, including lost opportunity costs; and appoint an independent fiduciary to terminate the plan. In addition, the department asks that the defendants be permanently barred from serving as fiduciaries to any plan in the future.

The suit resulted from an investigation conducted by EBSA’s Philadelphia regional office. Employers and workers needing help with problems related to private-sector retirement and health plans can reach the Philadelphia regional office at 215.861.5300 or may call EBSA’s toll-free number, 1.866.444.EBSA (3272).

In fiscal year 2005, EBSA achieved monetary results of $1.7 billion related to pension, 401(k), health and other benefits for millions of American workers and their families.

(Chao v.Michael Rizzi and Lomik Construction Corporation)
Civil Action No.: 2:06-cv-00547-DWA

U.S. Department of Labor news releases are accessible on the Department's Newsroom page. The information in this news release will be made available in alternate format upon request (large print, Braille, audio tape or disc) from the COAST office. Please specify which news release when placing your request at 202.693.7765 or TTY 202.693.7755. The U.S. Department of Labor is committed to providing America's employers and employees with easy access to understandable information on how to comply with its laws and regulations. For more information, please visit the Department's Compliance Assistance page.

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

Contact Name: Leni Uddyback-Fortson
Phone Number: 215.861.5102