U.S. Department of Labor sues defunct Tampa, Florida, construction company to protect participants’ 401(k) assets

Tampa, Florida – The U.S. Department of Labor’s Employee Benefits Security Administration (EBSA) has sued Blanchette Construction and its owners to restore assets to the former company’s 401(k) plan.

Filed in the U.S. District Court for the Middle District of Florida, the lawsuit alleges that the defendants violated provisions of the Employee Retirement Income Security Act (ERISA) when they withheld employees’ contributions to the plan but failed to forward the funds to the plan. The suit alleges that the defendants commingled those funds with the general assets of the company.

The Labor Department suit seeks a court order to require that Stephen Blanchette and Anita Blanchette restore all losses, including interest or lost opportunity costs, and that the defendants be permanently barred from serving as fiduciaries in the future to any employee benefit plan subject to ERISA. In addition, the suit asks the court to appoint an independent fiduciary to distribute the proceeds of the plan to eligible participants and terminate the plan.

“Workers have a right to expect that their retirement contributions are being handled for their best interest by their employers, and when employers break that trust, the Labor Department must step in to protect workers’ legal rights,” said R.C. Marshall, regional director for EBSA in Atlanta, Georgia.

Blanchette Construction operated in the Tampa area until it closed in 2006.

Employers with similar problems who are not yet subjects of EBSA investigations may be eligible to participate in the department’s Voluntary Fiduciary Correction Program. Participation requires employers to make workers whole but allows them to avoid EBSA enforcement actions and civil penalties as well as any applicable excise taxes.

In fiscal year 2008, EBSA achieved monetary results of $1.2 billion related to pension, 401(k), health and other benefits for millions of American workers and their families. Employers and workers can reach EBSA’s Atlanta Regional Office at 404.302.3900 or toll-free at 866.444.3272 for help with problems relating to private sector retirement and health plans. For more information, see www.dol.gov/ebsa.

Solis v. Blanchette Construction
(Civil Action Number 8:09-cv-01116-VMC-TGW)

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