JJF Management Overcharged Workers in Ownership Sale, Suit Says

The board of a Maryland management services company engaged in prohibited employee stock ownership plan transactions under ERISA, a new proposed class action says.

ESOP plan participants allege that the board of directors of J.J.F. Management Services Inc., which owns and operates auto dealerships in Maryland, Pennsylvania, and Florida, and several individual directors and trustees violated ERISA when they allowed the retirement plan to buy the company at inflated purchase prices, and to borrow hundreds of millions of dollars to do so.

The transaction resulted in significant debt for the ESOP, the plan participants allege in the complaint filed Aug. ...