A whistleblower and two former coworkers who supported her efforts have been awarded $630,000 in lost wages and damages after the Department of Labor won a consent judgment against the Cement Masons Southern California Trust Funds.
Cheryle Robbins, who was director of the CMSCTF audit and collections department, reported what she believed was lawbreaking behavior by a trustee with regard to CMSCTF's retirement and benefit plans.
First Robbins complained internally that the trustee, Scott Brain, a business manager for Cement Masons Local Union 600, was violating the federal Employee Retirement Income Security Act. Then in 2011, she cooperated with a federal criminal investigation into Brain's activities.
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But no good deed goes unpunished; when the joint board of trustees found out about her cooperation, it voted to put her on administrative leave. Subsequently CMSCTF outsourced her department to Zenith American Solutions, and Robbins was the only employee not hired by Zenith.
An investigation by DOL's Employee Benefits Security Administration found that the trustees of the CMSCTF, the trust funds' counsel Melissa W. Cook, law firm Melissa W. Cook & Associates, Zenith American Solutions, and its account executive Bill Lee had retaliated against Robbins unlawfully. As a result, DOL filed suit on May 21, 2014 — but the trustees weren't done yet.
Robbins's coworkers Cory Rice and Louise Bansmer supported her whistleblowing activities, and DOL had to amend its lawsuit to include allegations that Rice and Bansmer were also fired — because of their participation in Robbins' internal whistleblowing activities or because they refused to cease communicating with her after she was placed on leave.
Now, in a consent judgment, the U.S. District Court for the Central District of California has ordered 12 trustees of the Los Angeles-based CMSCTF and its service provider, Zenith American Solutions, to pay lost wages and damages to Robbins, Rice and Bansmer. The order also requires the settling trustee defendants to approve pension service credits to Robbins, who previously recovered $200,000 in a private state court action for wrongful termination.
In addition, the order asks the settling trustee defendants to call for Scott Brain to resign from any trustee position he currently holds, and to support the adoption of an investigation procedure to address future complaints about trustees. Also, both the settling trustees and Zenith American Solutions, including Lee, are permanently enjoined from retaliating against whistleblowers — and the settling trustees and Zenith American Solutions' employees, including Lee, are required to receive training under ERISA.
"There are no good stories about retirement savings crimes, but this case was particularly galling because three people were all punished for doing the right thing. But that's also what makes the resolution of this case so satisfying," said Assistant Secretary of Labor for Employee Benefits Security Phyllis C. Borzi. "Robbins, Rice and Bansmer suffered serious financial consequences because they stood up for what was right. This resolution ensures that they'll finally get the compensation they deserve."
The lawsuit continues with respect to four defendants: Brain, Cook, Melissa W. Cook & Associates, and one Local 600 trustee.
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