Wilmington Trust, N.A. Slapped with ERISA Class Action Lawsuit

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A proposed class action filed on behalf of participants in the ISCO Industries Inc. Employee Stock Ownership Plan (the Plan) claims defendant Wilmington Trust, N.A. violated the Employee Retirement Income Security Act of 1974 (ERISA), resulting in the proposed class members being “deprived of hard-earned retirement benefits.” The 13-page lawsuit claims the defendant, which is being sued as the successor to the Wilmington Retirement and Institutional Services Company, caused proposed class members to suffer financial harm when it authorized the Plan to buy shares of ISCO in 2012 for “more than fair market value.”

On December 12, 2012, ISCO, a privately-held company, sold four million shares of its common stock to the Plan in exchange for a 25-year note of $98 million (referred to as “the Transaction”). According to the complaint, the defendant failed in its fiduciary duties to the Plan when the Transaction allowed the defendant “to unload its interests in ISCO at an inflated price and saddle Plan participants with millions of dollars of debt payable to ISCO to finance the transaction.”