News: Justice Department Asks Supreme Court to Reverse Circuit Courts’ Pro-ESOP Position

ESOP Association News

The ESOP Association sent out the following press release. We are sharing with readers here.

For Immediate Release: November 14, 2013

Justice Department Asks Supreme Court to Reverse Circuit Courts’ Pro-ESOP Position

November 14, 2013 (Washington, DC) – In a disappointing turn of events, the Obama Administration has once again taken a negative position in regard to employee stock ownership plans (ESOPs).

Early in 2013, the Supreme Court asked the Solicitor General to comment on technical questions regarding stock-drop cases and to assess whether these types of cases should be brought to the attention of the Court. In a rather strange move, the Solicitor General asked the Court to focus only on a matter concerning ESOP plan fiduciaries, and whether they are entitled to the presumption that they have acted in the best interests of plan participants by investing in company stock.

“Congress, and former Presidents, has consistently encouraged ESOPs for over 30 years,” said ESOP Association President, J. Michael Keeling. “The presumption that ESOP plan fiduciaries act prudently when company stock is the ESOP’s primary asset was decided by the Third Circuit in Moench V. Robertson,  a 1995 case that plaintiffs won, making it clear bad actors do not prevail but also acknowledging Congress has endorsed ESOPs and Presidents have signed pro-ESOP laws. This pro-ESOP Moench position has been upheld by a majority of Federal courts for years, and one can only presume from the Solicitor General’s question of Moench that the Justice Department is looking to harm ESOPs.”

There is concern that if the Supreme Court agrees with the Administration, there will be a rise in lawsuits challenging ESOP companies. Numerous anti-ESOP lawsuits would do harm to ESOP companies and their employee owners.

“Since 2010, the ESOP community has been fighting a proposed regulation from the Department of Labor regarding the definition of an ESOP fiduciary. The Solicitor General’s attack on ESOPs is one more dig from an Administration that has demonstrated negative views of employee ownership as evidenced by its budget proposal justifying the reversal of a pro-ESOP tax law because, according to the Administration, employees working for companies with more than 10 – 15 employees are incapable of understanding how their actions impact their company. It’s counter-intuitive to hear the Administration preach about creating jobs and then try to take away a proven policy that sustains jobs,” stated Mr. Keeling.

For those that are curious, the Justice Department Brief: Brief

###

The ESOP Association is the national trade association for companies with employee stock ownership plans (ESOPs) and the leading voice in America for employee ownership. The core cause of The ESOP Association is the belief that employee ownership will improve American competitiveness, increase productivity through greater employee participation, and strengthen our free enterprise economy. More information: website – www.esopassociation.org and blog – www.esopassociationblog.org.

May 2013 ESOP Report Available

The May 2013 issue of the ESOP Report is now available for download from The ESOP Association’s website. To access this month’s issue, you’ll need to sign into the website. The Member Sign In button is located at the top of the page. To get to the ESOP Report, click on Meet & Learn. A link to the ESOP Report is located on the left side menu.

 

May2013ESOPReportCOVER

Joining Us in Las Vegas? Stop by the Membership Services Booth!

If you’re joining The ESOP Association for the 2012 Las Vegas Conference and Trade Show at Caesars Palace on November 8 & 9, stop by the Association’s Membership Services Booth (#107 on the Trade Show floor). We’ve got much to share this year.

  • Check out the ESOP Association’s NEW website

  • Pick up your deck of ESOP cards
  • View the interactive ABCs of ESOPs educational tool for ESOP participants

  • Pick up your copy of the new publication — A Guide to Financing ESOP Transactions

  • Enter to win an iPad 3!!!

Stop by and say “hello.”

The ESOP Association’s Membership Services Booth #107 on the Trade Show floor — where the ESOP community meets.

The ESOP Association’s NEW Website

You read that correctly. The ESOP Association has launched a new website. Check out the all new www.esopassociation.org. There are new section headers and easier navigation to help you find what you need faster. An improved Chapter section and easily accessible calendar provide access to information in your area and a news segment on the homepage gets you up to speed on ESOP information.

A quick walk through the new website:

Meet & Learn — Meetings information for both national and Chapter events; publications (print and electronic versions) including all technical and communications information offered by the Association and the ESOP Report newsletter; the online learning tool, the ABCs of ESOPs

Explore — Information on how ESOPs work and industry statistics; links to the Association’s Issue Briefs; and an employee ownership news section which contains an archive of the Association’s latest press releases

Advocate — Advocacy Kits; Government affairs information and the ESOP bulletin; links to additional government affairs commentary on YouTube and the Association’s Blog; Employee Ownership Month information; information on the ESOP PAC; and media assistance guidelines for Association members

Network — ESOP Experts; the Membership Directory; ESOP Yellow Pages; Online Board Registry; and social networking links to connect with the Association

Chapters — Chapter events and links to individual Chapter pages

About the Association — How to contact the Association; information on the ESOP Awards; how to join and member benefits; and sponsorship and advertising information

Additionally, the new website will also be accessible on smartphones and tablets through mobile and responsive design versions that will make navigation easier.

If you have questions about the new website, please let us know: media@esopassociation.org.

New from The ESOP Association

The following press release was sent out by The ESOP Association.

For Immediate Release: September 15, 2011

For More Information: Amy Gwiazdowski, 202/293-2971, amy@esopassociation.org

 The ESOP Association Submits Statement to Finance Committee on Tax Reform and Retirement Security

September 15, 2011 (Washington, DC) – On September 15, 2011, The ESOP Association submitted a statement for the record to the Senate Committee on Finance which held a hearing examining tax reform options and the promotion of retirement security.

“We presented to the Committee data that shows ESOP companies and their locally-controlled jobs are more profitable, more productive, and more sustainable,” said ESOP Association President, J. Michael Keeling. “The best jobs program Congress could consider now would be encouraging more employee-owned companies.”

A copy of the statement can be found on the Association’s website here.  A link to the statement is at the top of the page.

The ESOP Association is the national trade association for companies with employee stock ownership plans (ESOPs) and the leading voice in America for employee ownership.  The core cause of The ESOP Association is the belief that employee ownership will improve American competitiveness, increase productivity through greater employee participation, and strengthen our free enterprise economy.

###