Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Acosta v. Mueller

United States District Court, E.D. Wisconsin, Milwaukee Division

December 20, 2017

R. ALEXANDER ACOSTA, Secretary of the United States Department of Labor, Plaintiff,
v.
VERONICA MUELLER, et al., Defendants.

          AGREED CONSENT DECREE AND ORDER

          PAMELA PEPPER UNITED STATES DISTRICT COURT JUDGE

         Plaintiff R. Alexander Acosta, Secretary of the United States Department of Labor (the “Secretary” or the “Department of Labor”), Defendants Veronica Mueller and Roger Mueller (the “Muellers”) and the “Defendant Trusts”, [1] Alpha Investment Consulting Group, LLC (“Alpha”), Omni Resources, Inc. Employee Stock Ownership Plan and Trust (the “Omni ESOP”), [2] and Omni Resources, Inc. (“Omni”)[3] (collectively, and with the Secretary, the “Parties”), by and through their respective attorneys, have negotiated an agreement to settle the matters in controversy in this civil action, and each consents to the entry of this Agreed Consent Decree and Order by this Court as the sole and complete memorialization of the terms of such agreement.

         A. The Secretary filed this action pursuant to his authority under Title I of the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001, et seq., as amended.

         B. The Parties agree to settle this dispute on the terms and conditions hereinafter set forth and stipulate and agree to the entry of this Agreed Consent Decree and Order as a full and complete resolution of all of the civil claims, causes of action, and issues arising between them in this action without adjudication of any issue of fact or law raised in the Secretary's Complaint in this action.

         NOW THEREFORE, in consideration of the mutual covenants set forth in this Agreed Consent Decree and Order and other valuable and sufficient consideration, the Parties have agreed as herein stated. Accordingly, it is ORDERED, ADJUDGED AND DECREED that:

         I. JURISDICTION

         A. This Court has jurisdiction over the Parties and subject matter of this action, and is empowered to provide the relief herein.

         B. Omni voluntarily submits itself to the jurisdiction of this Court for the purpose of agreeing and subjecting itself to this Agreed Consent Decree and Order.

         II. MONETARY RELIEF

         A. Defendants Roger Mueller, Veronica Mueller, and the Defendant Trusts, jointly and severally, will (i) pay the Omni ESOP $1, 520, 681.82 (one million five hundred twenty thousand and six hundred eighty-one dollars and eighty-two cents), (ii) reduce the balance of both Omni's obligation to repay Veronica Mueller and the Defendant Trusts and the Omni ESOP obligation to repay Omni by the amount of $3, 500, 000 (three million five hundred thousand dollars) and Omni's loan in the same amount to the ESOP, and (iii) pay an ERISA § 502(1) penalty in the amount of $479, 318.18 (four hundred seventy-nine thousand three hundred eighteen dollars and eighteen cents) to the Department of Labor. As described in the following paragraphs, $1, 500, 000 (one million five hundred thousand dollars) (“First Installment”) will be paid to the Omni ESOP within sixty days of entry of this Agreed Consent Decree and Order. An additional $20, 681.82 (twenty thousand six hundred eighty-one dollars and eighty-two cents) (“Second Installment”) will be paid to the Omni ESOP within two years of the entry of this Agreed Consent Order and Order. The payment of an ERISA § 502(1) penalty of $479, 318.18 (four hundred seventy-nine thousand three hundred eighteen dollars and eighteen cents) will be made within the earlier of five days after the payment of the Second Installment or two years after the entry of the Agreed Consent Decree and Order. The Muellers' and/or the Defendant Trusts' settlement payments are, in part, in consideration for the assignments from Omni and the Omni ESOP described in paragraph VII below.

         B. As noted above, within sixty (60) days of the Court's entry of this Agreed Consent Decree and Order, Defendants Roger Mueller, Veronica Mueller, and/or the Defendant Trusts shall pay to the Omni ESOP the total sum of $1, 500, 000.00 (one million five hundred thousand dollars). This payment shall not be offset in any manner by any payments from Omni, the Omni ESOP, Alpha, or any other party.

         C. Within two years of the Court's entry of this Agreed Consent Order and Order, Defendants Veronica Mueller, Roger Mueller, and the Defendant Trusts shall pay the Omni ESOP the total sum of $20, 681.82 (twenty thousand six hundred eighty-one dollars and eighty-two cents). This payment shall not be offset in any manner by any payments from Omni, the Omni ESOP, Alpha, or any other party.

         D. Upon payment of the First Installment in paragraph II(B) above, full compliance with the Loan Restructuring Provisions in paragraph III below, and payment of the Second Installment pursuant to paragraphs II(C) and (E), the Department of Labor has determined that Defendants Roger Mueller, Veronica Mueller, and the Defendant Trusts shall be and hereby are assessed a total penalty under ERISA § 502(1), 29 U.S.C. § 1132(1), of $829, 166.67 (eight hundred twenty-nine thousand one hundred sixty-six dollars and sixty-seven cents). The Department of Labor has agreed to compromise and reduce the amount of the penalty to $479, 318.18 (four hundred seventy-nine thousand three hundred eighteen dollars and eighteen cents) (the “502(1) Penalty”). Therefore, the Secretary hereby does and will accept, as full satisfaction of the assessed penalty, the amount of $479, 318.18 (four hundred seventy-nine thousand three hundred eighteen dollars and eighteen cents) out of the Second Installment. Defendants Roger Mueller, Veronica Mueller, and the Defendant Trusts waive their rights to a separate notice of assessment of the penalty under § 502(1), 29 U.S.C. §1132(1), the service requirement of 29 C.F.R. § 2570.83, and their rights to seek any further reductions of or relief from the 502(1) Penalty. Defendants Roger Mueller, Veronica Mueller, and the Defendant Trusts shall pay the 502(1) Penalty to the United States Department of Labor within the earlier of five (5) calendar days of payment of the Second Installment or two (2) years after the entry of this Agreed Consent Decree and Order. The 502(1) Penalty must be paid by sending a certified or cashier's check to:

U.S. Department of Labor ERISA Civil Penalty P.O. Box 71360 Philadelphia, PA 19176-1360.

         The certified or cashier's check for the 502(1) Penalty shall be made payable to the United States Department of Labor and will reference EBSA No. 50-032066. If Defendants wish to remit a check by commercial express courier, they agree to contact Soroosh Nikouei at the United States Department of Labor (Nikouei.Soroosh@dol.gov or 202-693-8486) and follow his instructions.

         E. The Second Installment will be secured against the quarterly installment payments due from Omni to the Veronica Mueller and the Defendant Trusts in payment of the loan to Omni made in connection with the stock purchase transaction underlying this litigation. In the event that the payments described in paragraphs II(C) and II(D) of this Agreed Consent Decree and Order are not made within two (2) years of the date of the entry of this Agreed Consent Decree and Order, the amount of any such nonpayment up to $500, 000 of the next installment payments due from Omni to the Defendant Muellers and the Defendant Trusts shall be directed immediately by Omni to the Omni ESOP in the amount of any such nonpayment of the Second Installment and/or to the U.S. Department of Labor in the amount of any such nonpayment of the 502(1) Penalty. These payments are secured by the ongoing payments required under the amended promissory notes and ESOP Loan and Pledge Agreement referenced in paragraph III below, and Exhibit A hereto. To the extent that any such payments become necessary, Omni first shall remit payment to the Omni ESOP in the amount owed under paragraph II(C), plus accumulated interest under this paragraph, and then remit payment to the United States Department of Labor in the amount owed under paragraph II(D), plus accumulated interest under this paragraph.

         F. Defendants Roger Mueller, Veronica Mueller, and the Defendant Trusts shall provide to the Secretary proof of payment of the First and Second Installments and the 502(1) Penalty. Such proof will include wire transfer confirmations of the payments and such other proof as may be requested by the Secretary. Any proof provided under this paragraph will be sent to the Secretary's representative at the following address:

Jeffrey Monhart Regional Director, Chicago Regional Office Employee Benefits Security Administration U.S. Department of Labor John C. Kluczynski Federal Bldg. 230 S. Dearborn Street, Suite 2160 Chicago, IL 60604

         G. Defendant Alpha shall pay to the Omni ESOP the sum of $45, 454.55 (forty-five thousand four hundred fifty-four dollars and fifty-five cents) and to pay an ERISA § 502(1) penalty in the amount of $4, 545.45 (four thousand five hundred forty-five dollars and forty-five cents) to the Department of Labor.

         H. Within sixty (60) days of the Court's entry of this Agreed Consent Decree and Order, Defendant Alpha shall pay to the Omni ESOP the sum of $45, 454.55 (forty-five thousand four hundred fifty-four dollars and fifty-five cents) (the “Alpha Settlement Amount”) to fully settle the claims against Alpha in the Secretary's Complaint in this action. This payment shall not be offset in any manner by any payments from Omni, the Omni ESOP, Roger Mueller, Veronica Mueller, the Trusts, or any other party.

         I. Upon payment of the Alpha Settlement Amount, Defendant Alpha shall be and hereby is assessed a penalty under ERISA § 502(1), 29 U.S.C. § 1132(1), of $8, 333.33 (eight thousand three hundred and thirty-three dollars and thirty-three cents). The parties have entered into a compromise to reduce the amount of the penalty to $4, 545.45 (four thousand five hundred forty-five dollars and forty-five cents) (the “Alpha 502(1) Penalty”). Therefore, the Secretary hereby does and will accept, as full satisfaction of the assessed penalty, the amount of $4, 545.45 (four thousand five hundred forty-five dollars and forty-five cents). Defendant Alpha waives its right to a separate notice of assessment of the penalty under § 502(1), 29 U.S.C. §1132(1), and the service requirement of 29 C.F.R. § 2570.83. Defendant Alpha shall pay the Alpha 502(1) Penalty to the United States Department of Labor within five (5) calendar days of payment of the Alpha Settlement Amount to the Omni ESOP by sending a certified or cashier's check to:

U.S. Department of Labor ERISA Civil Penalty P.O. Box 71360 Philadelphia, PA 19176-1360.

         The certified or cashier's check shall be made payable to the United States Department of Labor and will reference EBSA No. 50-032066.

         J. Defendant Alpha shall provide to the Secretary proof of payment of the Alpha Settlement Amount and the Alpha 502(1) Penalty. Such proof will include wire transfer confirmations of the payments and such other proof as may be requested by the Secretary. Any proof provided under this paragraph will be sent to the Secretary's representative at the following address:

Jeffrey Monhart Regional Director Chicago Regional Office Employee Benefits Security Administration U.S. Department of Labor John C. Kluczynski Federal Bldg. 230 S. Dearborn Street, Suite 2160 Chicago, IL 60604.

         K. Notwithstanding any other provision of this agreement, the Secretary may seek any judicial remedy available, including contempt, if the responsible Defendants fail to pay the First Installment, the Second Installment, the 502(1) Penalty, the Alpha Settlement Amount, or the Alpha 502(1) Penalty as required herein or violate any other term of this Agreed Consent Decree and Order.

         III. RESTRUCTURING THE LOAN

         Defendants Veronica Mueller, the Defendant Trusts, and Omni and the Omni ESOP agree to restructure their respective loans and promissory notes made in connection with the December 30, 2008, stock purchase transaction such that the principal balance remaining on the loans and promissory notes shall be reduced by the sum of $3, 500, 000. The balance remaining owed by Omni to Defendant Veronica Mueller and the Defendant Trusts will be re-amortized and paid in approximately equal quarterly installments until paid in full. There will be no acceleration of payments on the remaining amount owed in either loan except as may otherwise later be agreed upon by the parties to the loans and promissory notes. The amended ESOP Loan and Pledge Agreement is attached hereto and made a part hereof as Exhibit A and incorporated herein by this reference. The amended promissory note between Omni and the Omni ESOP is attached hereto and made a part hereof as Exhibit B and is incorporated herein by this reference. The amended promissory note between Veronica Mueller and the Defendant Trusts and Omni is attached hereto and made a part hereof as Exhibit C.

         IV. ESOP PARTICIPANT ACCOUNTS

         A. Within thirty (30) days of receiving the payments set forth in paragraphs II(B), (C), and (G) above, the Omni ESOP shall allocate those monies to participant accounts for participants who were allocated shares of company stock between December 30, 2008, and the date of this Agreed Consent Decree and Order. The allocation of the payments shall specifically include former participants who vested in the Omni ESOP and received a distribution of plan assets prior to the date of entry of this Agreed Consent Decree and Order. The allocation of the payments to the participant accounts (including former participants) shall be pro rata according to the No. of shares that were allocated to each participant account between December 30, 2008, to the date of entry of this Agreed Consent Decree and Order, except that neither Defendant Roger Mueller nor Defendant Veronica Mueller shall receive any allocation of payments made to the Omni ESOP under this Agreed Consent Decree and Order. These payments shall not replace or be paid in lieu of a contribution to the Omni ESOP by Omni for any plan year. Roger Mueller and Veronica Mueller and the Defendant Trusts shall not be involved in any manner and shall have no liability with respect to the allocations and other actions set forth in this paragraph.

         B. Within thirty (30) days of the entry of this Agreed Consent Decree and Order, the Omni ESOP shall release to participants' accounts the shares of Omni stock necessary to account for the $3, 500, 000.00 loan reductions from Veronica Mueller and the Mueller Trusts to Omni and from Omni to the Omni ESOP described in paragraph III above. The allocation shall be pro rata in proportion to the No. of shares that were allocated to each participant between December 30, 2008, to the date of entry of this Agreed Consent Decree and Order except that Defendant Roger Mueller and Veronica Mueller shall not receive any allocation of shares made as a result of the $3, 500, 000 loan reduction from Omni to the Omni ESOP made under this Agreed Consent Decree and Order. The allocation of shares shall specifically include former participants who vested in the Omni ESOP and received a distribution of plan assets prior to the date of entry of this Agreed Consent Decree and Order. Omni and the Omni ESOP may amend the plan document to allow a five-year payment schedule for the put options on the shares allocated in this paragraph. Roger Mueller and Veronica Mueller and the Defendant Trusts shall not be involved in any manner and shall have no liability with respect to the allocations and other actions set forth in this paragraph.

         V. NON-MONETARY RELIEF

         A. Defendants may not seek direct or indirect contribution or indemnification from each other or Omni or the Omni ESOP and waive any rights they may have to such claims against Omni or the Omni ESOP. The Parties expressly acknowledge and agree that the assignment by Omni and/or the Omni ESOP of their certain claims set forth in paragraph VII below shall not be considered direct and/or indirect contribution or indemnification from each other or Omni, the Omni ESOP, or any other Party.

         B. Defendants may not assert any claims that arose or accrued on or before the date of the entry of this Agreed Consent Decree and Order under ERISA or under any other state or federal law against Omni or the Omni ESOP related to the December 30, 2008, Omni ESOP Stock Purchase Transaction underlying this litigation, including the repayment of any extensions of credit made by the Muellers, the Defendant Trusts, or Omni to the Omni ESOP that were not made. Defendants reserve their rights to bring claims arising after the date of the entry of this Agreed Consent Decree and Order for any failure by Omni to meet its obligations as required under the terms of the Stock Purchase Agreement and Promissory Notes, as those documents are amended by this Agreed Consent Decree and Order, as well as any settlement agreements incorporated in this Agreed Consent Decree and Order. Omni and the Omni ESOP may not assert any claims that arose on or before the date of the entry of this Agreed Consent Decree and Order under ERISA or any other state or federal law against the Defendants related to the December 30, 2008 Omni ESOP Stock Purchase Transaction underlying this litigation. Omni and the Omni ESOP reserve their rights to bring claims arising after the date of the entry of this Agreed Consent Decree and Order for any failure by Defendants to meet their obligations under the Stock Purchase Agreement and Promissory Notes as those documents are amended by this Agreed Consent Decree and Order.

         C. Defendants Roger Mueller and Veronica Mueller are permanently enjoined from serving as a fiduciary to any ERISA-covered employee benefit plan or engaging in any conduct that would make them a fiduciary under ERISA section 3(21), 29 U.S.C. § 1002(21).

         D. Defendant Alpha is permanently enjoined to comply with all requirements stated in the Agreement Concerning Process Requirements for Employee Stock Ownership Plan Transactions (the “Process Agreement”), attached hereto and made part hereof as Exhibit D, when it provides services to any ESOP or ESOP fiduciary. Defendants Roger Mueller and Veronica Mueller and the Defendant Trusts are not and shall not be involved in any manner and shall have no liability or obligations with respect to Exhibit D.

         VI. RELEASES

         A. This Agreed Consent Decree and Order provides full, final, and complete judicial resolution of all of the claims and causes of action alleged in the Secretary's Complaint in this action. Notwithstanding the foregoing, nothing in this Agreed Consent Decree and Order shall be deemed to waive any claim by the Secretary relating to the obligations set forth in this Agreed Consent Decree and Order. Furthermore, notwithstanding the foregoing, nothing in this Agreed Consent Decree and Order shall be deemed to waive any claim by any Defendant with respect to the Secretary's, Omni's and the Omni ESOP's obligations under this Agreed Consent Decree and Order.

         B. Except for the obligations set forth in this Agreed Consent Decree and Order, the Secretary and his agents, representatives, assigns, predecessors and successors in interest, acting in their official capacities, do hereby waive, release, and forever discharge all claims, demands, actions, causes of action, liabilities, or fines (including any penalty under § 502(1) of ERISA) they may have against Defendants Roger Mueller, Veronica Mueller, the Defendant Trusts, Alpha, and their respective directors, officers, agents, attorneys (except DeWitt, Ross & Stevens, S.C., and its present or former affiliates or employees, including, without limitation, Timothy Stewart, Brian Anderson, and Sandy Swartzberg), employees, representatives, assigns, predecessors, and successors in interest based upon the allegations in the Secretary's Complaint in this action.

         C. Defendants Roger Mueller, Veronica Mueller, and the Defendant Trusts, and their directors, officers, agents, attorneys, trustees, employees, representatives, assigns, and predecessors and successors in interest, do hereby release the Secretary and his officers, agents, attorneys, employees, and representatives, both in their individual and governmental capacities, from all actions, claims and demands of whatsoever nature, including those arising under the Equal Access to Justice Act or any statute, rule, or regulation, that relate in any manner to the investigations, filing, prosecution, maintenance, and settlement of the Secretary's Complaint.

         D. Defendant Alpha, and its directors, officers, agents, attorneys, employees, representatives, assigns, predecessors and successors in interest, do hereby release the Secretary and his officers, agents, attorneys, employees, and representatives, both in their individual and governmental capacities, from all actions, claims and demands of whatsoever nature, including those arising under the Equal Access to Justice Act or any statute, rule, or regulation, that relate in any manner to the investigations, filing, prosecution, maintenance, and settlement of the Secretary's Complaint.

         E. Except for the claims released by the Secretary in Paragraph VI(B) above, the Secretary's claims against all persons not identified in VI(B) are expressly preserved. Nothing in this Agreed Consent Decree and Order shall preclude the Secretary from initiating or continuing any audit or investigation, or from pursuing any claims or actions, against any entities or persons (other than the claims stated against Roger Mueller, Veronica Mueller, the Defendant Trusts, and Alpha, in the Secretary's Complaint) relating to any ERISA-covered plan, except for the claims the Secretary released in Paragraph VI(B) above. Nothing in this Consent Decree and Order resolves any claims that have been or may be asserted against Roger Mueller, Veronica Mueller, the Defendant Trusts, or Alpha by current and former participants of the Omni ESOP, or by any other person.

         F. Each Party represents and warrants that he, she, or it has not assigned all or part of any claim, demand, debt, or cause of action of any kind or nature released in this Agreed Consent Decree and Order to any other person or third party prior to executing this Agreed Consent Decree and Order.

         G. Roger Mueller, Veronica Mueller, the Defendant Trusts, Alpha, Omni and Omni ESOP have entered into a Settlement and Assignment Agreement and Mutual Release under which each such party has released the other pursuant to the terms thereof.

         VII. ASSIGNMENT OF CLAIMS

         Omni and the Omni ESOP agree to assign any rights to certain claims in connection with the December 30, 2008, Omni ESOP Stock Purchase Transaction underlying this litigation to Defendants Roger and Veronica Mueller and the Defendant Trusts. The terms of such assignment are documented in the separate Settlement and Assignment Agreement and Mutual Release and the Assignment Agreement between Roger Mueller, Veronica Mueller, the Defendant Trusts, Omni, and the Omni ESOP.

         VIII. RETENTION OF JURISDICTION

         This Court shall retain jurisdiction over the Parties and subject matter of this action for the purposes of enforcing and interpreting the terms of this Agreed Consent Decree and Order.

         IX. COST AND EXPENSES

         The Parties each shall bear their own costs, expenses, and attorneys' fees in connection with this action, the Secretary's investigation of the December 30, 2008, purchase of Omni stock by the Omni ESOP, and this Agreed Consent Decree and Order, including, but not limited to, attorneys' fees which may be available under the Equal Access to Justice Act, as amended. The Parties agree not to seek or accept indemnification from Omni or the Omni ESOP or use any assets of Omni or the Omni ESOP for any payments made or required to be made in this Agreed Consent Decree and Order or for any expenses, including attorneys' fees, associated with the negotiation, consideration, documentation, or implementation of this Agreed Consent Decree and Order.

         X. PARTIES BOUND

         By entering into this Agreed Consent Decree and Order, the Parties represent that they have read this Agreed Consent Decree and Order, been informed by counsel of the effect and purpose of this Agreed Consent Decree and Order, and agree to be bound by its terms. This Agreed Consent Decree and Order is not binding on any governmental agency other than the United States Department of Labor.

         XI. MULTIPLE ORIGINALS

         This Agreed Consent Decree and Order may be executed in counterparts, each of which shall be deemed to be an original, but all of which, taken together, shall constitute one and the same instrument. The date of execution of this Agreed Consent Decree and Order is the date on which it is signed by this Court.

         XII. ADMISSION OF LIABILITY

         Defendants Roger Mueller, Veronica Mueller, the Defendant Trusts and Defendant Alpha neither admit nor deny the allegations in the Secretary's Complaint in this action.

         XIII. NOTICE

         If any provisions of this Agreed Consent Decree and Order require notice to Omni and/or the Omni ESOP, such notice shall be ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.