March 20, 2025
Participants in a plumbing subcontractor’s defunct employee stock ownership plan can proceed as a class in their lawsuit claiming the plan overpaid for company shares and later sold them at a deflated price, a California federal judge ruled, saying the workers leading the suit are adequate representatives.
U.S. District Judge Kenly Kiya Kato granted class certification Tuesday in the Employee Retirement Income Security Act case accusing Ampam Parks Mechanical Inc., several executives and ESOP trustee Ventura Trust Co. of mismanaging the plan. The class includes all participants in and beneficiaries of the Ampam plan on Aug. 6, 2023, when the ESOP sold the company’s shares and the plan was dissolved.
According to current Ampam employee Alfredo Ramirez and former employee Ramón Santos Castro, the ESOP paid $247 million in 2019 for the plumbing company’s stock, more than fair market value and without gaining any control over the company. Ramirez and Castro claimed the ESOP then sold the company’s stock back to its former owners, Ampam founders and brothers Charles E. Parks III and John D. Parks, in 2023 for a much lower price.
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The workers are represented by Michelle C. Yau, Ryan A. Wheeler, Allison C. Pienta, Eleanor Frisch and Jacob T. Schutz of Cohen Milstein Sellers & Toll PLLC, and Shaun P. Martin of the University of San Diego School of Law.