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Guest Pensions in Paradise

I have no clue if this is true. But the REALLY sad thing is I wouldn't be the least bit surprised if this story were true. Our legal system has become a joke to put it mildly.

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Guest dbvail

To me it is clearly made up. But the fact that someone would spend that much time on a piece does indicate there should be a little concern about our industry in the slow months....

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Folks:

Are you saying that there is no benefit to the plan being held to a higher degree of protection than the individual?

It is a basic premise in ERISA that the fiduciary is to look out for the best interests of all plan participants.

If the fiduciary errs, he is to err on the side of the plan as a whole.

While this case is an exagerration (and may actually be a fantasy), it does drive home a valid point for protection for the plan as a whole.

While this (fantasy) person may hire an attorney to attempt to retrieve the money, he is in his legal rights to do so, for the attorney is to defend his client to the best of his ability.

That means the attorney need not lose sleep over how his actions may affect the plan; he need only be concerned how his actions affect his client.

How is that thinking any better than the ERISA protection for the plan over the individual?

Don Levit

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Mike and Belgarath:

I guess we are crying wolf, one too many times.

If you go to my posting, you will find this is a REAL case.

I E-mailed one of the attorneys, Andrew Hartley, regarding his writ of certiorari before the REAL Supreme Court.

This is a "realer deal" than Evander Holyfield.

No levity from this Levit!

Don Levit

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Don, "it" can't speak to air. The writ may be real, but the previous postings are bogus. Therefore, I don't have a clue what issue you think the writ speaks to. Do you think it speaks to the issue of malapropism with respect to pigs and hogs? If not, what?

BTW, 9th circuit cases are not unknown for their levity. Supreme Court decisions sending the 9th circuit home (proverbially speaking) with their tail tucked 'tween their legs are not unknown for their levity.

There is levity all around, Don. Embrace it!

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Guest ERISA Litigator

The issue in Coates is not the issue in the made up (yes, of course made-up, but not impossible under the analyses used by the court in the real case cited) cases. The Coates issue has been around for years and years and years (probably before ERISA) and is not yet resolved. It would be nice if the Supreme Court would hear it, but I doubt it will. Can anyone by chance post a copy of the district court's opinion?

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Becky:

Thanks for providing this case.

Although ERISA is based on the law of trusts, I believe, the ERISA trust is very different from the more traditional trust.

The more traditional trust is similar to gifts, from the grantor to the beneficiaries.

The ERISA trust is more of a "business-type" trust, in which the employer, typically, has a different outlook than the grantor of the traditional trust.

Thus, the tension between the beneficiaries of an ERISA plan, and the "business" purposes for the ERISA's plan creation and maintenance.

Don Levit

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  • 3 weeks later...

Sad, but I had my 401(k) account stolen once by an employer. He straight up liquidated it. It was only a couple thousand dollars so what could I do? Hire an attorney? It would have cost me more than a couple thousand dollars. The company was very small so I doubt the DOL would have come in. Maybe 2 or three people were affected. He ended up filing for bankruptcy. it was a bummer, but I chalked it up to a life lesson. I should have quit sooner.

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I would observe that you shouldn't sell the DOL short on something like this. I have personally seen them be very aggressive with enforcement on complaints by lone participants in very small plans. While I'm frequently not a fan of the DOL, this is one of their good aspects. The very real threat of major fines and especially prison time sometimes provides an astonishing impetus for some of these slimeballs to correct things properly.

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  • 1 month later...

Ttott,

If someone stole your 401(k) money and you can prove it (which wouldn't be hard it sounds like from your facts), I am confident (despite my criticism of how badly the federal courts have mangled ERISA) that not only would you win, but you would also recover court costs and attorneys' fees. The only issue is whether your defendant has the money to pay up and how long ago this happened.

Also, I agree with Belgarath. I'm pretty sure the DOL would pursue it and would involve the DOJ as well. In fact, the DOL prefers to go after smaller companies rather than corporate giants.

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  • 1 year later...
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