US Labor Department sues defunct California pet clinic and its owners to restore assets and recover lost employee contributions to profit sharing plan

Date of Action: Feb. 12, 2014

Type of Action: Complaint

Name of Defendants: Animal Clinic of Alamo Inc., Deborah Knibb, John C. Baine III and Animal Clinic of Alamo Profit Sharing Plan

Allegations: The complaint alleges that Deborah Knibb violated the Employee Retirement Income Security Act (ERISA) when she withdrew $152,338 from the Animal Clinic of Alamo Profit Sharing Plan at various times from June 2010 through October 2011. At least $32,580 of these funds belonged to non-trustee Plan participants. As Plan fiduciaries, both owners failed to terminate the Plan, properly distribute its assets to participants and maintain a fidelity bond, as required by ERISA.

Resolution: The complaint asks the court to order Knibb to restore funds attributable to non-trustee Plan participants, including lost earnings of at least $36,925. The suit also seeks to permanently remove both owners as fiduciaries and permanently enjoin Knibb and Baine from serving as fiduciaries or service providers to any ERISA-covered plan. The department also seeks to appoint an independent fiduciary to distribute the Plan’s assets and to terminate the Plan, and order Knibb to pay all costs associated with the appointment and retention of the independent fiduciary.

Court: United States District Court for the Northern District of California

Docket Number: 3:14-cv-667

Employers and workers can reach EBSA toll free at 866-444-3272 for help with problems relating to private sector retirement and health plans. Additional information can be found at www.dol.gov/ebsa.

U.S. Department of Labor news materials are accessible at www.dol.gov. The information above is available in large print, Braille, audio tape or disc from the COAST office upon request by calling (202) 693-7828 or TTY (202) 693-7755.