Federal court orders defunct Baltimore company, owner to forfeit $388K in shares to restore missing contributions to employee 401(k) plan

Date of action:           Feb. 1, 2024

Type of action:          Consent judgment of forfeiture entered by the U.S. District Court for the District of Maryland in Baltimore. Follows a complaint filed by the U.S. Department of Labor on July 13, 2021, a consent judgment obtained in May 2022 and a motion to hold the defendants in contempt granted in June 2023. 

Defendants:               Bicallis LLC, Bryan Hill and Bicallis LLC 401(k) plan

Background: An investigation by the department’s Employee Benefits Security Administration found that Baltimore-based logistics, engineering and management support company and its owner violated the Employee Retirement Income Security Act of 1974. EBSA found that the company and Hill failed to forward employees’ payroll deductions for the company’s 401(k) plan and, from October 2017 through December 2019, did not collect company matching and safe harbor contributions owed to the plan. The company ceased operations in 2022.

On May 6, 2022, the department obtained a consent judgment that required the company and Hill to pay $151,942, which represented missing contributions and interest to the 401(k) plan and costs to appoint an independent fiduciary, by December 2022.

 The defendants defaulted on the judgment and the department filed a motion to hold them in contempt, which the court granted on June 27, 2023. In its contempt finding, the court ordered the defendants to pay a fine of $100 per day until they paid amounts owed in full.

To date, neither the company nor Hill have paid the money owed in full or remitted funds to the plan’s court-appointed independent fiduciary. On Sept. 13, 2023, the department filed a request to convene a second civil contempt hearing and for enhanced civil contempt remedies. To avoid that hearing, the defendants agreed to a consent order of forfeiture for $388,458 in assets due to Hill and his ex-wife and the parties requested that the court enter the consent order of forfeiture.

Relief: Under the consent judgment of forfeiture, the court ordered Hill to irrevocably forfeit his share of $388,458 being held in trust and directed the trustee to remit those assets to the independent fiduciary to satisfy his obligations to remit equitable restitution.

Quotes: “The forfeiture of Bryan Hill’s shares is a substantial step towards enforcing the consent judgment in this matter. Fiduciaries who violate their duties under federal law cannot escape the consequences of their actions,” said Acting Regional Solicitor of Labor Samantha Thomas in Philadelphia. 

“The U.S. Department of Labor is committed to protecting the benefits of America’s workers. We will continue to aggressively pursue and hold fiduciaries accountable when they fail to manage employee 401(k) plans as the law requires,” said EBSA Regional Director Cristina O’Brien in Philadelphia. 

Walsh v. Bicallis LLC et al

Civil Case No. 1:21-cv-01746-SAG