US Department of Labor sues Stafford, Texas-based Paradigm Machine Works and owner to recover workers’ 401(k) contributions and payments

STAFFORD, Texas – The U.S. Department of Labor has sued oil field equipment and machine parts manufacturer MWDay Group Inc., doing business as Paradigm Machine Works Inc., in Stafford, and its owner and president, Michael W. Day.  The lawsuit alleges that the defendants failed to forward employee contributions and matching employer contributions to the company’s 401(k) plan in violation of the Employee Retirement Income Security Act.

“Plan officials have a duty to manage and protect employee benefit plans and their assets,” said Roger Hilburn, director of the department’s Employee Benefits Security Administration’s Dallas Regional Office, which conducted an investigation that led to the suit. “The purpose of the department’s action today is to restore plan assets that were not properly preserved for this company’s workers.”

The suit, filed in the U.S. District Court for the Southern District of Texas, Houston Division, alleges that the defendants failed to timely segregate and remit contributions to the plan between Oct. 20, 2006, and June 8, 2007.

The suit seeks a court order to require Paradigm Machine Works and Day to restore to the plan all losses with interest. It also asks the court to terminate the plan, remove Day from his position with this plan after assets are disbursed and permanently bar him from serving as a fiduciary or service provider to any plan governed by ERISA in the future. 

For help with problems relating to private sector retirement and health plans, employers and employees can call EBSA’s Dallas Regional Office at 972-850-4500 or toll-free at 866-444-3272.

EBSA protects the retirement, health and other workplace-related benefits of America’s workers, retirees and their families. The agency oversees approximately 708,000 private sector retirement plans, 2.8 million health plans and other plans that provide benefits to more than 150 million Americans. Collectively, these plans hold more than $6 trillion in assets. Additional information can be found at www.dol.gov/ebsa.

Solis v. MWDay Group Inc., doing business as Paradigm Machine Works Inc. et al
Civil Action Number 4:11-cv-01931

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