DOL Requests Approval of Settlement in Pennsylvania Mushroom Farm Case

The Department of Labor April 8 announced that it reached a settlement with the owners of a Pennsylvania mushroom farm to enable benefits from the defunct company’s profit-sharing plan to be paid to plan participants, according to court documents filed Monday.

In documents filed in the U.S. District Court for the District of Massachusetts, in the case Julie A. Su, acting Secretary of Labor, United States Department of Labor v. Joseph Silvestri & Son, Inc et al., the DOL asked that the agreement get court approval.

The request follows a complaint filed earlier this month against the Employee Retirement Income Security Act plan, the company Joseph Silvestri & Son Inc., president and owner Donna Fecundo and the Joseph Silvestri & Son, Inc. Profit Sharing Plan.

Before filing the complaint, the DOL “negotiated a resolution” of the alleged ERISA violations with the defendants, wrote the DOL, in the motion to approve and enter the consent judgment. “That agreement—which provides all of the relief that the Acting Secretary seeks to redress the violations—is contained within an executed consent judgment and order.”

The DOL consent judgment directed the parties to cooperate in the filing of the civil lawsuit, requested a court order to remove Fecondo and the company as plan fiduciaries and to provide a permanent injunction to either serving as a trustee, fiduciary, adviser, or administrator to any ERISA employee benefit plan. The parties also agreed to appoint AMI Benefit Plan Administrators, Inc. as the independent fiduciary for the plan.

The DOL has alleged defendants failed to administer their responsibilities under ERISA to terminate the retirement plan and failed to meet their obligations to ensure distribution of the plan’s assets to the participants and beneficiaries or alternatively retain a fiduciary to manage the plan and oversee the distribution of assets.

The Joseph Silvestri & Son, Inc. Profit Sharing Plan held $355,001 in retirement assets for 68 participants, as of the last DOL Form 5500 filing, in 2014.

The current custodian of plan assets is Morgan Stanley Smith Barney, LLC.

The plan’s trust held $597,351.42 in retirement assets for 70 participants, including Fecondo, Morgan Stanley’s records as of July 31, 2022, show, according to the complaint.