Court restores more than $42K to employee benefit plan of defunct Detroit dental services provider after US Department of Labor complaint

DETROIT – Under terms of a consent order and judgement entered in federal court, the fiduciaries of Deliver Dental Solutions Inc. 401(k) Plan and Trust have agreed to restore $42,488 to the Detroit-based employee benefit plan.

An investigation by the U.S. Department of Labor’s Employee Benefits Security Administration found fiduciaries – Robert J. Kamphuis Jr. and Thomas D. Rose – violated the Employee Retirement Income Security Act by failing to remit and timely remit employee salary deferral contributions and participant loan repayments to the employee benefit plan.

The agreement resolves a complaint filed in February 2020 in the U.S. District Court for the Eastern District of Michigan, Southern Division by the Secretary of Labor against the fiduciaries, and the Deliver Dental Solutions Inc. 401(k) Plan and Trust. The district court found the defendants jointly and severally liable for $42,488 in total remaining debt to the plan, consisting of unremitted employee salary deferral contributions, unremitted participant loan repayments and associated lost opportunity costs.

“This judgment restores to participants their hard-earned retirement funds and protects their future,” said Employee Benefits Security Administration Regional Director Joe Rivers in Cincinnati. “Fiduciaries must work solely in the interest of plans and participants, and manage employee benefit plans in accordance with federal laws.”

The Jan. 29, 2021, settlement requires Kamphuis and Rose:

• To restore $42,488 to the plan following an agreed upon repayment schedule. The amount due does not include the $11,103 owed to Rose, for which he waives repayment.
• Be removed as fiduciaries to the plan.
• To be enjoined from serving as a fiduciary or service provider in the future to any ERISA-governed employee benefit plan.

The court also requires that the plan appoint an independent fiduciary to oversee the plan assets’ distribution and its termination.

Prior to ceasing operations in March 2019, Deliver Dental Solutions Inc. employed more than 65 employees, including dental assistants, attending providers, general dentists, front desk staff, administrative staff and contractual employees in metro Detroit. Since then, participants and beneficiaries have not been able to obtain distributions of their individual plan account. On Oct. 21, 2020, the U.S. Bankruptcy Court for the Eastern District of Michigan, Southern Division, entered a judgment determining non-dischargeability of both Kamphuis’ and Rose’s debt owed to the Deliver Dental Systems Inc. 401(k) Plan.

Employers and workers can reach EBSA toll-free at 866-444-3272 for help with problems related to private sector retirement and health plans. Learn more about EBSA.

Court: U.S. District Court for the Eastern District of Michigan, Southern Division

Docket Number: 3:20-cv-10384-RHC-APP