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Release Date: 11/16/2004
Release Number: 133 (04-2281-SAN)
Contact Name: Deanne Amaden
Phone Number: 415.975-4741
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San Francisco, California - The U.S. Department
of Labor has sued Reno-based Lodging and Gaming Systems, Inc. (LGS), its
owner and the trustees of the corporation’s 401(k) plan for failing to
collect $237,295 in delinquent employee and employer contributions and
loan repayments owed to the plan. Steven H. Urie, the owner and president
of bankrupt LGS, allegedly used the money to pay corporate debts and
expenses after the corporation experienced financial problems. |
Secretary
of Labor Elaine L. Chao said, “This Administration has a strong track
record in protecting the benefits promised to America’s workers; this
year we achieved record monetary results totaling $3.1 billion for
retirement, 401(k), health and other programs. Our legal action in the LGS
case makes it clear that those who manage pension plans are forbidden from
using plan assets to enrich themselves or their businesses.” |
The
department sued Urie, as a fund trustee, along with trustee Hugh Gallagher
and LGS for violating the Employee Retirement Income Security Act (ERISA)
by failing to forward to the plan employee contributions and loan
repayments deducted from employee paychecks at various pay periods
throughout 2000, 2001 and 2003. Additionally, the defendants failed to
collect delinquent employer contributions owed to the plan. The defendants
also allowed LGS to retain plan assets in its corporate account and used
the assets to pay the operating expenses of LGS and two other companies
owned by Urie — Gamet Technology, Inc. and Club Management, Inc., which
also operated as Caughlin Club. |
LGS
develops software for hotels and casinos. The company’s 401(k) plan
covered as many as 34 participants and had $755,428 in assets during 2002. |
The suit seeks a court order requiring the defendants
to make restitution and appointing an independent fiduciary to manage the
plan. The department also asks the court to remove the defendants as plan
fiduciaries and permanently bar them from service to plans governed by
ERISA in the future. |
In
a separate bankruptcy filing, the department sued Urie to prevent him from
discharging any debt owed to the plan in bankruptcy proceedings. On December
29, 2003, Urie and his three companies filed for bankruptcy protection. |
The
legal actions were filed in federal district court in Reno. Employees and
workers can contact the San Francisco Regional Office at 415.975.4600 or
through EBSA’s toll free number, 1.866.444.EBSA (3272), for help with
any problems relating to private-sector pension and health plans. |
Chao
v. Urie
Civil Action No. CV-N-04-0623-HDM-VPC
Bankruptcy Adversary Proceeding No. 04-05161-GWZ |
U.S.
Labor Department news releases are accessible on the Internet at
www.dol.gov. The information in this news release will be made available
in alternate format upon request (large print, Braille, audio tape or
disc) from the COAST office. Please specify which news release when
placing your request at 202.693.7765 or TTY 202.693.7755. The U.S.
Department of Labor is committed to providing America's employers and
employees with easy access to understandable information on how to comply
with its laws and regulations. For more information, please visit
www.dol.gov/compliance. |