North Branford, Connecticut employer agrees to restore $30,000 to employee pension plan, settling U.S. Labor Department lawsuit

Archived News Release — Caution: Information may be out of date.

Boston – Prime Technology LLC and company president Raymon S. Sterman have agreed to repay $30,000 to the company’s profit-sharing 401(k) plan under a consent judgment resolving a lawsuit filed by the U.S. Department of Labor.

Money restored under the consent judgment order will be allocated to the accounts of eligible plan participants.

The suit, filed in the U.S. District Court for the District of Connecticut, alleged that the defendants violated the Employee Retirement Income Security Act (ERISA) by causing the plan to pay administrative expenses that actually were supposed to be paid by the company. ERISA, the federal law that protects private sector pension and employee benefit plans, requires that plan assets be used only for the benefit of plan participants and prohibits the use of such assets to benefit a party in interest, such as the company.

“The Labor Department’s job is to ensure that the interests of the plan participants are properly protected,” said James Benages, director of the Boston Regional Office of the Labor Department’s Employee Benefits Security Administration (EBSA), which administers ERISA. “The defendants in this case should not have used plan assets to pay expenses for which the company was responsible.”

This case was investigated by EBSA’s Boston Regional Office. Employers and workers can reach EBSA at 617.565.9600 or toll-free at 1.866.444.EBSA (3272) for help with problems relating to private sector retirement and health plans. In fiscal year 2006, EBSA achieved monetary results of $1.4 billion related to pension, 401(k), health and other benefits for millions of American workers and their families.

Chao v. Prime Technology LLC
Civil Action Number: 3:07-CV-00511-(AHN)

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 202.693.7828 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.