U.S. Labor Department sues to protect participants of abandoned New Jersey 401(k) plan

Archived News Release — Caution: Information may be out of date.

Old Bridge, New Jersey – The U.S. Department of Labor has filed a lawsuit to obtain appointment of an independent fiduciary to oversee the 401(k) plan of Coffman Tree Service Inc., a defunct company in Old Bridge.

The suit alleges that since the company ceased operations in 1997, no one has taken fiduciary responsibility to operate or administer the plan and its assets. As a result, participants and beneficiaries have been unable to gain access to their pension benefits.

“Under the law, companies cannot abandon 401(k) plans when they cease operations,” said Jonathan Kay, regional director of the Labor Department’s Employee Benefits Security Administration (EBSA) in New York. “We took action because Coffman Tree Service Inc. did not protect the interests of its plan participants.”

Filed in the U.S. District Court for the District of New Jersey, the suit seeks a court order to appoint an independent fiduciary to terminate the plan and distribute its assets to participants and beneficiaries. As of April 2008, the plan had three participants and approximately 24,785 in assets.

This case was investigated by EBSA’s New York Regional Office. Employers and workers needing help with problems related to private sector retirement and health plans can reach the regional office at 212.607.8600 or call EBSA toll-free at 866.444.3272.

In fiscal year 2007, EBSA achieved monetary results of $1.5 billion related to pension, 401(k), health plans and other benefits for millions of American workers and their families. Information on EBSA is available from the agency’s Web site at www.dol.gov/ebsa.

Chao v. Coffman Tree Services Inc.
Civil Action Number: 2:08-cv-05294-JAG-MCA

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Archived News Release — Caution: Information may be out of date.