Opinion
CASE NUMBER: 2:04CV00262 TC
May 13, 2004
RISA D. SANDLER, Counsel for Fiduciary Litigation
CONSENT ORDER WITH UTAH CARPENTERS AND CEMENT MASONS DEFENDANT TRUSTEES
Plaintiff Elaine L. Chao, Secretary of the United States Department of Labor ("Secretary"), and Defendants Pat Eyre, Patti Anderson, Stewart Irving III, Mike Kuberski, John McEntire, John Salazar, A.D. Slagowski and Mike Tolboe ("Defendant Trustees") have negotiated an agreement to settle all civil claims and issues between them in this action, and each consents to the entry of this Consent Order by the Court as the sole and complete memorialization of the terms of such agreement, which is fully integrated. There are no separate oral, implied, written, or collateral agreements, other than as expressly set forth herein and in the contemporaneously filed Consent Order with Utah Carpenters and Cement Masons Plans.
1. This action was filed by the Secretary pursuant to her authority under Title I of the Employee Retirement Income Securi-ty Act of 1974 ("ERISA"), 29 U.S.C. § 1001, et seq., as amended. The complaint alleges that the Defendant Trustees violated provisions of Title I of ERISA while acting in a fiduciary capacity with respect to the Utah Carpenters and Cement Masons Health and Welfare Trust Fund ("Health Plan") and/or the Utah Carpenters and Cement Masons Pension Trust Fund ("Pension Plan") (collectively, "Plans"), which are employee benefit plans subject to the coverage of ERISA, in connection with the Plans' investments managed by Capital Consultants, LLC ("CCL"). The v Plans are joined as defendants pursuant to Rule 19, Fed.R.Civ.P., in order to ensure that complete relief can be granted.
2. The Defendant Trustees acknowledge service of the complaint and admit that the Court has jurisdiction over the parties and the subject matter of this action.
3. The Secretary and the Defendant Trustees expressly waive Findings of Fact and Conclusions of Law and consent to the entry of this Order as a full and complete resolution of all of the civil claims and issues arising between them in this action without trial or adjudication of any issue of fact or law raised in the complaint.
4. The Defendant Trustees each expressly acknowledge and represent that they have read this Order and understand its provisions. The undersigned attorneys each expressly acknowledge and represent that they are authorized and empowered to execute this Order on behalf of the party represented and that they have fully disclosed any conflicts of interest; relating to their representation for purposes of executing this Order.
Accordingly, it is ORDERED, ADJUDGED AND DECREED that:
I. JURISDICTION
The Court has jurisdiction over the parties to this Order and subject matter of this action and is empowered to provide the relief herein.
II. COMPLIANCE
The Defendant Trustees will discharge their duties to each of their Plans in compliance with ERISA and not take any action in the discharge of such duties that is inconsistent with the Plans' full compliance with ERISA or with any court orders entered in connection with litigation relating to the Plans.
III. MONETARY RELIEF
A. The Defendant Trustees will cause to be paid by their fiduciary liability insurance carrier(s) a total of $1,085,000 (one million, eighty five thousand dollars) to fully settle the Secretary's claims against the Defendant Trustees as described above, as well as the statutory penalty set forth in ERISA § 502(1), 29 U.S.C. § 1132(1), in connection with the settlement of this case. Pursuant to ERISA § 502(1), 29 U.S.C. § 1132(1), and the regulations thereunder, the Secretary has determined that the statutory penalty is $180,833.33 (one hundred eighty thousand, eight hundred thirty-three dollars and thirty-three cents).
B. The Defendant Trustees will cause to be paid by their fiduciary liability insurance carrier(s) the amount set forth in paragraph A above in the following manner: payment of $67,812.50 (sixty-seven thousand, eight hundred twelve dollars and fifty cents) to the Health Plan and payment of $836,354.17 (eight hundred thirty-six thousand, three hundred fifty-four dollars and seventeen cents) to the Pension Plan will be made within ten (10) days of entry of this Order, and payment of $180,833.33 (one hundred eighty thousand, eight hundred thirty-three dollars and thirty-three cents) will be paid to the United States Treasury in the time and manner provided by ERISA § 502(1), 29 U.S.C. § 1132(1), and the regulations thereunder, by forwarding a check or other instrument in the appropriate amount to: U.S. Department of Labor, ERISA Civil Penalty Collections, P.O. Box 100240, Atlanta, GA 30384-0240. The check or other instrument shall be made payable to the United States Department of Labor and shall reference EBSA Case Nos. 70-011567 and 70-011568.
IV. PRESERVATION OF CLAIMS AND DEFENSES
Nothing in this Order shall be construed as a declaration by the signatories to this Order that any person not a signatory hereto has any defense or affirmative defense, any right or basis for contribution or indemnity or any other basis for recovery from the Plans, any of the Plans' trustees, any person signatory hereto, or the Secretary.
V. NOTICE
Provisions of this Order requiring notice to the Defendant Trustees shall be satisfied by delivering it in writing to the Defendant Trustees in care of:
W. Joel France CompuSys of Utah, Inc. 2156 West 2200 So. Salt Lake City, Utah 84119 Phone: (801) 973-1001 Fax: (801) 973-10C7
with a duplicate delivered to:
Nathan M. Jenkins Jenkins Carter 501 Hammill Lane Reno, Nevada 89511 Phone: (775) 829-7800 Fax: (775) 829-0511
Provisions of this Order requiring notice to the Secretary shall be satisfied by delivering it in writing to:
Bette Briggs Regional Director U.S. Department of Labor Employee Benefits Security Administration 71 Stevenson Street, Suite 915 P.O. Box 190250 San Francisco, CA 94119-0250 Phone: (415) 975-4600 Fax: (415) 975-4589 with a duplicate delivered to:
Timothy D. Hauser Associate Solicitor Plan Benefits Security Division U.S. Department of Labor 200 Constitution Avenue, N.W. Room N-4611 Washington, DC 20210 Phone: (202)693-5600 Fax: (202)693-5610
Delivery shall be made by facsimile transmission or reliable overnight express courier service. The parties to this Order may, as they deem necessary, change from time to time the designation of persons to receive notice on their behalf by filing with the Court notification of such change and serving a-copy thereof on the other party or parties to this Order, by delivery to the address to which notice would be sent.
VI. RELEASES
A. The present Order represents a full, final and complete judicial resolution of all of the civil claims alleged in the Secretary's complaint against the Defendant Trustees in this action, and all such claims are hereby released, settled and dismissed with prejudice. Neither the Secretary nor the Defendant Trustees or Plans waive any claims against any other persons. The Secretary's claims for monetary and injunctive relief and the Defendant Trustees' and Plans' claims for monetary and equitable relief against any other persons are expressly preserved.
B. The Secretary hereby releases the Defendant Trustees from all civil actions, claims and demands arising under any statute, rule or regulation enforced by the Secretary that relate in any manner to the Plans' investments managed by CCL.
C. Each of the Defendant Trustees signatory hereto and, where applicable, their agents, beneficiaries, representatives, assigns and successors in interest, do hereby release the Secretary and her officers, agents, attorneys, employees, and representatives, both in their individual and governmental capacities, from all actions, claims and demands of whatsoever nature, including those arising under any statute, rule or regulation, that relate in any manner to the filing, prosecution, and maintenance of this civil action or any other proceeding or investigation incident thereto.
D. The Secretary and the Defendant Trustees shall bear their own costs, expenses, and attorney's fees in connection with this action.
VII. RETENTION OF JURISDICTION
This Court shall retain jurisdiction over the parties and subject matter of this action for the purpose of enforcing the terms of this Order.
VIII. PARTIES BOUND
By entering into this Order, each Defendant Trustee represents that he or she has been informed by Counsel of the effect and purpose of this Order and agrees to be bound by its terms. The Defendant Trustees expressly represent that they will abide by any further Orders of this Court, subject to their right of appeal from such orders. This Order is not binding on, or enforceable by, any governmental agency other than the United States Department of Labor.
IX. SIGNATORIES
The Defendant Trustees each expressly acknowledge and represent that they have read the Order and understand its provisions. The undersigned attorneys each expressly acknowledge and represent that they are authorized and empowered to execute this Order on behalf of the party represented and that they have fully disclosed any conflicts of interest relating to their representation for purposes of executing this Order.
X. MULTIPLE ORIGINALS
This Order may be executed in counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same instrument.
XI. ENTRY OF JUDGMENT
The Court finds that there is no just reason to delay the entry of this Order and, pursuant to Rule 54(b), Fed.R.Civ.P., expressly directs the entry thereof as a final Order.