U.S. Labor Department obtains default judgment against defunct Lewes, Delaware, company to protect workers’ 401(k) plan

Lewes, Delaware — The U.S. District Court for the District of Delaware has issued a default judgment removing defunct Keystone Professional Employers Inc. of Lewes as fiduciary of its 401(k) plan. The judgment resolves a lawsuit filed by the U.S. Department of Labor in January alleging that the company abandoned its plan without distributing the assets when it ceased operations in 2000.

The judgment authorizes Lefoldt & Co. P.A. of Ridgeland, Mississippi, to terminate the plan and distribute plan assets to participants and beneficiaries. According to the latest data available, the plan had nine participants and approximately $14,268 in assets as of May 27, 2009.

“This legal action will ensure that former employees of this company can gain access to their retirement savings,” said Mabel Capolongo, director of the department’s Employee Benefits Security Administration in Philadelphia, Pennsylvania. “Employers cannot abandon 401(k) plans when they go out of business.”

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 Philadelphia Regional Office at 215.861.5300 or toll-free at 866.444.3272 for help with problems relating to private sector retirement and health plans. For more information, visit www.dol.gov/ebsa.

Solis v. Keystone Professional Employers Inc.
Civil Action Number: 1:10-cv-00033