Pension & Benefits Daily™ covers all major legislative, regulatory, legal, and industry developments in the area of employee benefits every business day, focusing on actions by Congress,...
Aug. 12 — A Pennsylvania lawyer should be forced to contribute more than $50,000 to his employees' 401(k) plan, the Department of Labor told a federal appeals court ( Sec. U.S. Dep't of Labor v. Kwasny, 3d Cir., No. 16-01872, brief filed 8/10/16 ).
In February, the DOL obtained a court order requiring Richard J. Kwasny to restore his employees' 401(k) contributions to the plan after Kwasny allegedly kept the contributions in his firm's bank account in violation of federal law.
Kwasny appealed this order to the U.S. Court of Appeals for the Third Circuit, arguing that the department's lawsuit against him was untimely and barred by another case brought by one of the attorneys at Kwasny's firm.
In response, the DOL on Aug. 10 filed a brief arguing that Kwasny already admitted that his alleged activities—commingling his workers' 401(k) deductions in the firm's general account rather than forwarding them to the plan—constituted a fiduciary breach under the Employee Retirement Income Security Act.
The department also challenged Kwasny's claim that the DOL's lawsuit against him was barred by an earlier court case filed by one of the attorneys at Kwasny's firm. According to the department, it had no connection with that attorney and his lawsuit therefore couldn't interfere with the department's.
Finally, the DOL disputed Kwasny's argument that the department filed its lawsuit outside the applicable statute of limitations. Specifically, Kwasny failed to establish that the department had knowledge of his alleged breaches more than three years before it filed suit, the DOL argued.
The department's brief was submitted by M. Patricia Smith, G. William Scott, Thomas Tso and Leonard H. Gerson. Kwasny represents himself.
To contact the reporter on this story: Jacklyn Wille in Washington at firstname.lastname@example.org
To contact the editor responsible for this story: Jo-el J. Meyer at email@example.com
Text of the DOL's brief is at http://www.bloomberglaw.com/public/document/Secretary_United_States_Depart_v_Richard_Kwasny_et_al_Docket_No_1.
Copyright © 2016 The Bureau of National Affairs, Inc. All Rights Reserved.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)