The U.S. Labor Department filed a lawsuit against Baltimore architectural firm Kann & Associates Inc. to recover $56,000 the agency says the firm owes employees' retirement accounts.
The firm failed to deposit that amount of withheld employee contributions into the company's 401(k) plan from July 28, 2010 through July 1, 2012, according to a suit filed Tuesday in U.S. District Court in Baltimore. The plan had 20 participants and assets of $2.28 million as of Dec. 31, 2014, the lawsuit says. It alleges the company violated the federal Employee Retirement Income Security Act, or ERISA.
The lawsuit, which also names Donald Kann, the firm's president, values of the opportunity cost of the missing and late employee contributions at more than $34,000.
The company has been cooperating with the Labor Department, an attorney for the firm said Friday. After the firm decided to stop contributing to the plan around 2012, an audit showed a discrepancy over the money, said the attorney, David J. Polashuk.
"We firmly believe that before long we'll be able to resolve it," Polashuk said. "If the money is owed, it will be paid. We need to understand how they arrived at their numbers."
The firm, founded in 1974, is known for projects such as the Bagby Building redevelopment in Harbor East and the Hotel Indigo in Mount Vernon.
The agency is asking the court to require the company to restore all losses and remove the company and Kann as fiduciaries of the plan and any other employee benefit plans.
"The company and Kann each participated knowingly in or knowingly undertook to conceal acts or omissions by the other that they knew to be violations of ERISA," lawsuit said.