DOL FILES SUIT IN CASE INVOLVING DEFUNCT COMPANY AND 401K DISTRIBUTIONS

FROM:  U.S. LABOR DEPARTMENT 

US Labor Department files suit against Vic International Corp. in Knoxville, Tenn. to restore 401(k) contributions

Date of Action: Feb. 23, 2015

Type of Action: Complaint

Name(s) of Defendant(s): Vic International Corp., Vic International 401(k) Profit Sharing Plan, James Victor Green, Kelly Milligan, and Paul Kelley
Allegations: In 1996, Vic International Corp., based in Knoxville, Tennessee, established a 401(k) Profit Sharing Plan for its employees. During the course of an investigation by the U.S. Department of Labor's Employee Benefits Security Administration, the agency found that from Aug. 2011 to March 2012, Vic International, James Victor Green, Kelly Milligan, and Paul Kelley failed in their fiduciary responsibility to forward $21,688.60 in employee contributions to the plan and also allowed the funds to be commingled with general company assets. Additionally, the agency found that in October 2011, the defendants caused or allowed distributions from the plan to be made to defendant Kelly Milligan totaling $69,600 without documentation or record of repayment. Vic International Corp. ceased operations in March 2012 and since that time, defendants failed to make distributions of plan assets and terminate the plan in accordance with plan documents.

Resolution: The department is asking the court to order the defendants to restore to the plan all losses, including interest or lost opportunity costs, which occurred as a result of their breaches of fiduciary obligations or as a result of a co-fiduciary's breach; to permanently enjoin the defendants from serving as fiduciary, administrator, officer, trustee, custodian, agent, employee, representative, or having control over the assets of any employee benefit plan subject to Employee Retirement Income Security Act; to enjoin the defendants from engaging in any further action in violation of Title I of ERISA; to appoint a successor fiduciary or administrator to the plan at the defendants' expense; and to provide such other relief as may be just and equitable.

Court: United States District Court for the Eastern District of Tennessee, Knoxville Division

Docket Number: 3:15-cv-00079-PLR-CCS