U.S. Labor Department sues former Fort Lauderdale, Florida, construction company First State Development to restore pension assets

Fort Lauderdale, Florida – The U.S. Department of Labor has sued former Fort Lauderdale construction company First State Development and its chief executive officer to restore losses owed to the company’s 401(k) plan.

Filed in the U.S. District Court for the Southern District of Florida in Fort Lauderdale, the lawsuit alleges that AVLR Inc., All South Florida Maintenance and David J. Perry violated the Employee Retirement Income Security Act by failing to forward to the plan contributions deducted from employees’ paychecks. Instead, the contributions were co-mingled with the general assets of the company.

AVLR Inc. and All South Florida Maintenance did business under the name First State Development.

According to the suit, which resulted from an investigation by the department’s Employee Benefits Security Administration, the defendants also allegedly failed to make employer matching contributions to the plan in 2006 and 2007 as required by the plan. Since that time, the defendants have failed to take action to restore to the plan the full amount of the contributions plus lost interest owed to the plan.

“The Labor Department will not allow companies to use workplace retirement plans as a source of interest-free cash for the company,” said R.C. Marshall, EBSA’s regional director in Atlanta, Georgia.

The suit seeks a court order to require the defendants to restore to the plan all losses with lost interest or opportunity costs, offset individual plan accounts of any defendant for losses owed to this plan, remove them as fiduciaries to the plan and permanently bar them from serving in a fiduciary capacity to any employee benefit plan subject to ERISA. In addition, the suit asks the court to appoint an independent fiduciary at the defendants’ expense.

In fiscal year 2009, EBSA achieved monetary results of $1.3 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 http://www.dol.gov/ebsa.

Solis v. AVLR Inc.
Civil Action File Number 0:10-cv-60448-FAM

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