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 user 2009-03-02 at 11:46:13 am Views: 69
  • #21513
    Lawsuit filed against former Cookeville company
    COOKEVILLE TN — A former Cookeville company has been sued by the U.S. Department of Labor for failing to provide 401(k) participants access to their retirement funds.Renewable Resources Inc., a re-manufacturer of computer printer and toner cartridges, is accused of failing to terminate its 401(k) plan and distribute assets to eligible participants after the company ceased operations. As a result, participants were unable to receive information about and access to their funds.The suit, filed Feb. 13 in U.S. District Court for the Middle District of Tennessee, asks the court to appoint an independent fiduciary to terminate the plan and distribute its assets.The Department of Labor did not release how many people could possibly be affected.Renewable Resources was bought by New Jersey-based Reink Imaging in 1999, and both companies are no longer in operating. Michael Wald, a spokesman with the U.S. Department of Labor, said Renewable Resources filed for bankruptcy in 2003.

    The U.S. Department of Labor typically doesn’t discuss how investigations are initiated, he said, but according to a press release, the case resulted from an investigation conducted by the department’s Employee Benefits Security Administration office in Atlanta.

    A former Renewable Resources employee, who spoke on the condition of anonymity, said the problem with the 401(k) accounts was discovered about three years ago after she had met with a financial planner. The company administering the program, New York-based investment firm Scudder Kemper, was unable to release it to the participants.“Because Renewable Resources was no longer in business, and the so-called guardian of the account was no longer living, basically the account was in limbo,” the employee said. “It’s more of a formality, I guess, but the only way it can be resolved at this point is for the courts to appoint a fiduciary to act on behalf of the 401(k) program.”It isn’t the first time Renewable Resources has made headlines. In 1999, the company was required to alter its practice of ink disposal — Renewable had been using an underground tank that the EPA said might contaminate ground water.In 2000, the company had another run-in with the EPA. Reink was found responsible for turning the Falling Water River red — after an employee inadvertently dumped 20 to 30 gallons of water-based, non-hazardous red ink down a drain. The company was cited for the incident.

    A court date for the current case has yet to be set.
    “The Labor Department will step in to protect the rights of plan participants when the fiduciary fails to make provisions for the orderly distribution of assets from its discontinued retirement plan,” R.C. Marshall, regional director of the EBSA, said in a statement.In the 2008 fiscal year, EBSA achieved monetary results of $1.2 billion related to pensions, 401(k), health and other benefits for millions of American workers and their families.