UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA

Transcription

1 UNITED STATES DISTRICT COURT FOR THE EASTERN DISTRICT OF NORTH CAROLINA If you were an employee participant in the Trojan Horse Ltd. 401(k) Retirement Plan from January 1, 2011, through September 20, 2016, you could get a payment from a class action settlement. A federal court authorized this Notice. This is not a solicitation from a lawyer. You are not being sued. If you are a Class Member, your legal rights are affected whether you act or don t act. PLEASE READ THIS NOTICE CAREFULLY This notice concerns a proposed class-action settlement that would resolve a lawsuit against Ascensus Trust Company ( Ascensus ), which was the directed trustee for the Trojan Horse Ltd. 401(k) Retirement Plan ( Plan ) established by Trojan Horse, Ltd., Glen Burnie Hauling, Inc., BDH Logistics, LLC, or Capitol Expressways, Inc. (the Trojan Horse Companies ). The dispute in the case is as follows: The persons bringing the case claim that they and other participating employees in the Plan contributed a portion of their wages into the Plan, but those contributions were never deposited into the Plan. They claim Ascensus as directed trustee violated the Employee Retirement Income Security Act of 1974 ( ERISA ), by not ensuring contributions were properly paid into the Plan. The trial court certified this case as a class action. It also found Ascensus as directed trustee for the Plan was a fiduciary (i.e. a person having discretion and control over the Plan) and had corresponding duties, specifically in regard to the enforcing of employee contributions to the Plan. The trial court found Ascensus did not meet its fiduciary duty in regard to Plan contributions that were deducted from Class Members wages but never deposited. In addition, the trial court concluded Ascensus and the other defendants in the case were liable to Class Members for their unpaid Plan contributions. Ascensus appealed the trial court s ruling, and while the case was on appeal, the parties suing and Ascensus agreed to a proposed settlement. This Class Notice is part of the proposed settlement. Records indicate that you may be due money under the settlement because available Payroll Records indicate you made contributions to the Plan through deductions from your pay, but those contributions were never deposited for you into the Plan. If the settlement is finally approved by the Court, any amounts owed to you will held and paid to you by an independent third party not the defendant Ascensus. This Notice informs you about your legal rights and options in the proposed settlement. There s nothing you have to do to receive a payment under the settlement

2 YOUR LEGAL RIGHTS AND OPTIONS IN THIS SETTLEMENT RECEIVE A PAYMENT You do not have to do anything to be entitled to receive a payment from the Settlement Fund. If the Court finally approves the settlement after a Fairness Hearing, you ll be given payment or rollover options; in either case, the money will be automatically yours to do with as you wish. OBJECT Write to the Court about why you don t like the settlement. Your objection must be received no later than May 7, GO TO A HEARING Ask to speak in Court about the fairness of the settlement. You must mail this request, so it is received no later than May 7, These rights and options, and the deadlines to exercise them, are further explained in this Notice. The Court in charge of this case still has to decide whether to approve this settlement. Payments will be made only if the Court approves the settlement and after any appeals of the settlement are resolved. Please be patient. WHAT THIS NOTICE CONTAINS BASIC INFORMATION...Page 3 1. Why did I get this Class Notice? 2. What is this lawsuit about? 3. Why is this a class action? 4. Why is there a settlement? WHO IS IN THE SETTLEMENT...Page 4 5. How do I know if I am part of the settlement? 6. I m still not sure if I am included. THE SETTLEMENT BENEFITS WHAT YOU GET...Page 5 7. What can I get from the settlement? YOUR PAYMENT AMOUNT AND MAILING...Page 5 8. How can I get a payment and what will it be? 9. When would I get my payment? THE LAWYERS REPRESENTING YOU...Page Do I have a lawyer in the case? 11. How will the lawyers be paid? OBJECTING TO THE SETTLEMENT...Page How do I tell the Court that I don t like the settlement? - 2 -

3 THE COURT S FAIRNESS HEARING...Page When and where will the Court decide whether to approve the settlement? 14. Do I have to come to the Hearing? 15. May I speak at the Hearing? IF YOU DO NOTHING...Page What happens if I do nothing at all? GETTING MORE INFORMATION...Page How do I get more information? BASIC INFORMATION 1. Why did I get this Class Notice? You received this Class Notice because available Payroll Records regarding Trojan Horse, Ltd., Glen Burnie Hauling, Inc., BDH Logistics, LLC, or Capitol Expressways, Inc., indicate that portions of your wages or pay were deducted as contributions to the Trojan Horse Ltd. 401(k) Retirement Plan ( Plan ), but those contributions were never deposited. The Court directed the parties to send you this Class Notice because you have a right to know about a proposed settlement of a class action lawsuit, and about all of your options, before the Court decides whether to finally approve the settlement. The Court in charge of the case is the United States District Court for Eastern District of North Carolina, and the case is known as Longo v. Trojan Horse Ltd. Case No. 5:13-cv-418-BO. The judge presiding over this case is the Honorable Terrence W. Boyle, United States District Judge. 2. What is this lawsuit about? The persons bringing a civil lawsuit are referred to as plaintiffs. The persons being sued are called defendants. Here, Plaintiffs sued Ascensus and several other defendants including the employers Trojan Horse, Ltd., Glen Burnie Hauling, Inc., BDH Logistics, LLC, or Capitol Expressways, Inc. (the Trojan Horse Companies ) and the individuals, Brian Hicks, Susan Stubbs and Sherry Korb. All defendants besides Ascensus either never responded to the suit or were dropped. In their lawsuit, Plaintiffs claimed that they and other participating employees in the Plan contributed a portion of their wages into the Plan, but those contributions were never deposited by the Trojan Horse Companies. Plaintiffs claim Ascensus, which was directed trustee for the Plan, violated the Employee Retirement Income Security Act of 1974 ( ERISA ), by not ensuring the contributions were properly paid into the Plan on behalf of Class Members. The trial court agreed and concluded Ascensus and the other defendants in the case were liable to Class Members for their unpaid Plan contributions, which the Court awarded in the amount of $2,985, Ascensus appealed the trial court s ruling, and while the case was on appeal, Plaintiffs and Ascensus agreed to a proposed settlement, among other reasons, to avoid further costs and delays in getting Class Members the monies the Court ruled they were entitled to receive. This Class Notice is a part of the settlement proposal and is required under Federal law

4 3. Why is this a class action? U.S. District Judge Terrence W. Boyle certified this lawsuit as a class action, meaning he allowed it to proceed on group rather than individual basis. When a court certifies a case as a class action, it typically appoints one or more of the plaintiffs as Class Representatives (in this case, Allen Hester, Carl Swanson, and Steven White) to represent other people who have similar legal claims. The people together are a Class or Class Members. The attorneys the court appoints for the Class are typically referred to as Class Counsel. Certifying a case as a class action allows one court to resolve the issues in the case for everyone in the Class at one time, rather than on an individual basis. 4. Why is there a settlement? Ascensus appealed the trial court s ruling. While the case was on appeal, Plaintiffs and Ascensus agreed to a proposed settlement leading to an Agreement they are proposing to the Court and to Class Members to settle the case finally and forever with no more appeals. Appeals present a risk and often lead to delays in payments due to persons who ve won in the lower court. In arriving at a settlement, Plaintiffs considered the amount, certainty, and immediate availability of benefits afforded Class Members under the terms of this settlement Agreement; weighed against the delay, risks, and expenses associated with the continued and prolonged appeal of the lower court s ruling. Plaintiffs and Class Counsel also considered that the Settlement Agreement establishes a Settlement Fund of $2,702, (roughly 90% of the amount won in the trial court), from which individual payments called Allocated Shares will be paid to each Class Member. Once the settlement is final, Ascensus has agreed to pay this money into an account established and administered by a third-party called an Independent Fiduciary, which will distribute the Allocated Shares independently with oversight by, and under the authority of, the Court. After deductions from the Settlement Fund called for under the settlement, each Class Member s Allocated Share of the money awarded by the Court ($2,985,914.27) will be approximately 85% of the monies deducted as Plan contributions from his/her pay but not deposited in the Plan on his/her behalf. In addition, Ascensus has agreed to pay all of the expenses of providing you notice of this settlement. It has also agreed to pay up to $40, of the $80, estimated expenses of administering the settlement and of establishing, maintaining and distributing a Settlement Fund to pay Class Members. Only those expenses exceeding $40, for administering the settlement and of establishing, maintaining, and distributing the Settlement Fund will be deducted from the Settlement Fund. Ascensus has also agreed to pay all attorney s fees and costs of the lawsuit and these expenses will be totally separate from Settlement Fund and will not reduce it in any way. Under these circumstances, Plaintiffs and Class Counsel believe the settlement is fair and reasonable. WHO IS IN THE SETTLEMENT To see if you are eligible under this settlement, you first have to determine if you are a member of the Class explained below

5 5. How do I know if I am part of the settlement? You are part of this settlement, if you meet two conditions: (1) You were an employee of Trojan Horse, Ltd., Glen Burnie Hauling, Inc., BDH Logistics, LLC, or Capitol Expressways, Inc.; and, (2) You contributed to the Trojan Horse Ltd 401(k) Plan through payroll deduction from January 1, 2011, through September 20, There are also certain exceptions to the Class, including certain people and companies affiliated with or related to the Defendant, Class Counsel, and members of the Eastern District of North Carolina judiciary and their immediate families. 6. I m still not sure if I am included. If you are still not sure whether you are included, you can get free help. If you don t know whether you are a Class Member, or you have questions about the settlement, you may call the Notice Administrator at or write the Notice Administrator at Longo v. Trojan Horse, c/o Notice Administrator, 1801 Market Street, Suite 660, Philadelphia, PA THE SETTLEMENT BENEFITS WHAT YOU GET 7. What can I get from the settlement? Under the Settlement Agreement each Class Member s Allocated Share of the money awarded by the Court ($2,985,914.27) is approximately 85% of the monies deducted from his/her pay as Plan contributions, but not deposited into the Plan on his or her behalf. If the settlement is approved, you will get this money with no further delay or risk. Ascensus will pay into a Settlement Fund from which each Class Member s Allocated Share will be paid. Also, Class Members benefit from the settlement by what they don t have to pay. Ascensus has agreed to pay all of the expenses of providing you notice of the settlement and up to $40, of the $80, estimated expenses for administering the settlement and of establishing, maintaining and distributing a Settlement Fund to pay Class Members. Only those expenses exceeding $40, for administering the settlement and of establishing, maintaining, and distributing the Settlement Fund will be deducted from any Class Member s share of the Settlement Fund. Class Members also will not have to pay for attorneys to represent them as Class Members in this case. Ascensus has agreed to pay all attorney s fees and costs of the lawsuit and these expenses will be totally separate from Settlement Fund and will not reduce any Class Member s Allocated Share in any way. YOUR PAYMENT AMOUNT AND MAILING 8. How can I get a payment and what will it be? - 5 -

6 There s nothing you have to do to receive a payment under the settlement. You do not have to do anything to be entitled to receive a payment from the Settlement Fund. If the Court finally approves the settlement after a Fairness Hearing, you ll be given payment or rollover options; in either case, the money will be automatically yours to do with as you wish. The Independent Fiduciary which will be responsible for calculating and distributing Allocated Shares of the Settlement Fund. The amount of your money you will be entitled to will be approximately 85% of the monies deducted as Plan contributions from your pay, but not deposited into the Plan on your behalf. Note that the Allocated Shares (85%) of the monies due each Class Member under the settlement was calculated after the Settlement Fund was reduced by: (1) a $20,000 Service Award split among three Class Representatives and one original plaintiff, who took the risk of serving as lead plaintiffs in the case, provided information and answered formal questions in the case, had to testify in depositions, and worked on behalf of the Class concerning key aspects of the case, including this settlement; and (2) an estimated $40,000 payment to the Independent Fiduciary for establishing, maintaining, and distributing the Settlement Fund. 9. When would I get my payment? The Court will hold a hearing on June 5, 2018 at 2:00 p.m. Eastern Time, to decide whether to approve the settlement. If Judge Boyle approves the settlement, there may be appeals of the settlement if some Class Members object. It s always uncertain whether these appeals can be resolved and resolving them can take time. It may also take up to 8-12 months for the Independent Fiduciary to allocate and reconcile Allocated Shares from the Settlement Fund. Please feel free to contact the Notice Administrator for updates and other important information about the settlement by phone at toll-free or write the Notice Administrator at Longo v. Trojan Horse, c/o Notice Administrator, 1801 Market Street, Suite 660, Philadelphia, PA Please be patient. THE LAWYERS REPRESENTING YOU 10. Do I have a lawyer in this case? The Court has appointed the following law firms to represent you and other Class Members: Stephen A. Dunn Emanuel & Dunn Post Office Box 426 Raleigh, NC Steven R. Jaffe Mark S. Fistos 110 N. Federal Hwy, Suite 501 Ft. Lauderdale, FL These attorneys are called Class Counsel. You will not be charged for services performed by Class Counsel. If you want to be represented by your own lawyer, you may do so, but you will have to pay any costs of having a separate attorney represent you. 11. How will the lawyers be paid? Class Counsel will ask the Court to approve a payment of $915, for attorneys fees and $67, for costs related to the lawsuit; and payment of $5,000 each to Class Representatives Allen Hester, Carl Swanson, and Steven White, and one plaintiff, Garibaldi Longo for their services in acting as lead plaintiffs in the case, providing information and answering formal questions in the case, testifying in depositions, and - 6 -

7 working on behalf of the Class concerning key aspects of the case, including this settlement. The Court may award less than these amounts. Ascensus has agreed separately to pay the attorney s fees and costs of the lawsuit that the Court awards and has agreed not to oppose these fees and costs provided they stay at or below the amounts stated above. The payment of attorney s fees and costs will be totally separate from the Settlement Fund and will not reduce any Class Member s Allocated Share in any way. The Settlement Fund will be reduced by a $20,000 Service Award split among three Class Representatives and one original plaintiff. The Settlement Fund will also be reduced by an estimated $40,000 payment to the Independent Fiduciary for establishing, maintaining, and distributing the Settlement Fund. Still, the amount of your check will be approximately 85% of the monies deducted as Plan contributions from your pay, but not paid to the Plan on your behalf. OBJECTING TO THE SETTLEMENT it. If you are a Class Member, you can tell the Court that you don t agree with the settlement or some part of 12. How do I tell the Court that I don t like the settlement? If you are a Class Member, you can object to the proposed settlement. You can give reasons why you think the Court should not approve the settlement. The Court will consider your views. Your objections (a) must be in writing and (b) you must mail your objection to the Clerk of Court, to be received by the Clerk no later than May 7, 2018, and served on Class Counsel and Defense Counsel, no later than May 7, 2018, to the below addresses. Clerk of the Court: Case No. 5:13-cv-418-BO United States District Court for the Eastern District of North Carolina 310 New Bern Avenue Raleigh, NC Class Counsel: Stephen A. Dunn Emanuel & Dunn Post Office Box 426 Raleigh, NC Defense Counsel: Robert H. Bernstein Michael J. Slocum Greenberg Traurig, LLP 500 Campus Drive, Suite 400 Florham Park, NJ Your objection must include all of the following: The name of the case, which is Longo v. Trojan Horse Ltd., Case No. 5:13-cv-418-BO. Your name, address, and telephone number. A statement of your objection and the specific legal and factual basis for it. A description of any and all evidence, including documents, on which you base your objection and that you may offer at the Fairness Hearing including the names and expected testimony of any witnesses

8 A statement of whether you or your lawyer will ask to appear at the Fairness Hearing to talk about your objections. If you intend to have a lawyer present, you must identify your lawyer by name, bar number, address, and telephone number. For more information about the Fairness Hearing, see Question 13 below. Unless you submit a proper and timely written objection, according to the above requirements, you may not be allowed to object or appear at the Fairness Hearing. Please note that any objections or motions may only be submitted by an individual Class Member or his or her attorney, not as a member of a group or class. THE COURT S FAIRNESS HEARING The Court will hold a hearing (called a Fairness Hearing ) to decide whether to approve the settlement. You may attend the Fairness Hearing and you may ask to speak, but you are not required to. 13. When and where will the Court decide whether to approve the settlement? The Court will hold a Fairness Hearing to decide whether to finally approve the proposed settlement. You may attend, and you may ask to speak, but you are not required to do either one. The Fairness Hearing will be on June 5, 2018, at 2:00 p.m. Eastern Time, before the Honorable Terrence W. Boyle, United States District Judge, at the Federal Courthouse located at 310 New Bern Avenue, Raleigh, NC 27601, in Courtroom 2. At this hearing, the Court will consider whether the proposed settlement and all of its terms are adequate, fair and reasonable. The Court will consider any objections that are timely, made in the proper form, and include the required content. The Court will listen to people who have asked for permission to speak at the hearing and complied with the other requirements for objections explained in Question 12. The Court may also decide how much to pay Class Counsel and Plaintiffs for their service to the Class. After the hearing, the Court will decide whether to finally approve the proposed settlement. There may be appeals after that. We do not know how long these decisions will take. The Court may change deadlines listed in this notice without further notice to the Class as a whole. To keep up on any changes in the deadlines, please contact Class Counsel listed in Question 10 or visit the Settlement Website Do I have to come to the Hearing? No. Class Counsel will answer any questions asked by the Court. But, you are welcome to come at your own expense if you wish to do so. If you intend to have a lawyer appear on your behalf at the Fairness Hearing, your lawyer must enter a written notice of appearance of counsel with the Clerk of the Court no later than May 7, 2018, and you must comply with all of the requirements explained in Question 12. If you send an objection, you are not required to come to Court to talk about it. As long as you mailed your written objection on time and complied with the other requirements for a proper objection, the Court will - 8 -

9 consider it. 15. May I speak at the Hearing? Yes. You or your lawyer may ask the Court for permission to speak at the Fairness Hearing. To do so, you must send a notice of appearance and follow the procedures set out in Question 12 for objecting and appearing. Your notice of appearance must be filed with the Clerk of the Court by May 7, 2018 and served on Class Counsel and Defense Counsel by May 7, See Question 12 for the addresses. IF YOU DO NOTHING 16. What happens if I do nothing at all? You do not have to do anything to be entitled to receive a payment from the Settlement Fund. If the Court finally approves the settlement after a Fairness Hearing, you ll be given payment or rollover options; in either case, the money will be automatically yours to do with as you wish. GETTING MORE INFORMATION 17. How do I get more information? This Class Notice summarizes the proposed settlement. More details are in the Settlement Agreement. You can get a copy of the Settlement Agreement by visiting the Settlement Website at or by calling the Notice Administrator at toll-free, or by writing the Notice Administrator at Longo v. Trojan Horse, c/o Notice Administrator, 1801 Market Street, Suite 660, Philadelphia, PA You may also obtain additional information by: Reviewing legal documents that have been filed with the Clerk of Court in this lawsuit at the Court offices stated in Question 12 above during regular office hours. Contacting Class Counsel listed in Question 10 above. PLEASE DO NOT CALL THE JUDGE OR THE COURT CLERK TO ASK QUESTIONS ABOUT THIS LAWSUIT OR NOTICE. THE COURT AND CLERK OF COURT WILL NOT RESPOND TO LETTERS OR TELEPHONE CALLS. IF YOU WISH TO ADDRESS THE COURT, YOU MUST FILE THE APPROPRIATE PAPERS WITH THE CLERK OF THE COURT IN ACCORDANCE WITH THE REQUIREMENTS STATED IN THIS CLASS NOTICE