On December 20, 2012, ISCO and/or its prior owner(s) sold four million shares of common stock in the company to the ESOP in exchange for a 25-year note of $98 million, accruing 2.4% annual interest. (“Wilmington Trust”), in the U.S. District Court for the District of Delaware (the “Lawsuit”). ISCO employees claimed Wilmington, which served as the stock plan’s trustee, facilitated a deal in which they paid $98 million for ISCO stock that was later valued at only $39 million. “Because the price for any buyback would necessarily be determined in large measure based on trailing 12 months of financial results and informed financial forecasts for the coming year, the timing of any buyback necessarily would have a major impact on the appropriate sales price.”According to the complaint, by August 2017, ISCO’s financial fortunes had begun to look up, “dramatically so,” as a result of a confluence of events including Hurricane Harvey, which had the effect of driving great demand for industrial piping at the same time that a large part of the supply was being eliminated. ISCO also claimed that DPF "failed to pay ISCO at least $62,351.07 for the materials provided" under the contract at issue, and argued that Mr. Fleming's lawsuit is an attempt "to avoid payment of at least $62,351.07 to ISCO and unspecified compensatory damages, liquidated damages, and punitive damages exceeding $15,000.00." ISCO INDUSTRIES, LLC, a Kentucky limited liability company, Plaintiff, v. CARL D. ERDLE, an adult individual, Defendant. Wilmington Trust is agreeing to settle a lawsuit alleging the firm caused and engaged in prohibited transactions under the Employee Retirement Income Security Act (ERISA) related to a sale of ISCO Industries’ stock to participants in its employee stock ownership plan (ESOP).

The now-settled lawsuit that targeted Wilmington Trust directly alleged that the firm had violated its ERISA duties in agreeing to “a dramatically inflated valuation and price for the shares of ISCO stock as of 2012.”“By summer 2016, with ISCO experiencing financial doldrums, the Kirchdorfer defendants saw an opportunity to buy back the ISCO stock they had sold to the ESOP four years earlier and began plotting to do so,” the complaint states. James made no inquiry of any ISCO sales executives concerning the company’s forecasts or valuation, and to plaintiffs’ knowledge, did not solicit the opinion of any participants, much less conduct even an informal survey of participants concerning the proposed transaction or its terms,” the complaint states. Wilmington Trust is agreeing to settle a lawsuit alleging the firm caused and engaged in prohibited transactions under the Employee Retirement Income Security Act (ERISA) related to a sale of ISCO Industries’ stock to participants in its employee stock ownership plan (ESOP). The various trust defendants all are structured for the benefit of the Kirchdorfer family and were among the purchasers of ISCO stock in the buyback transaction described further below. North Carolina, Western Division. ISCO Industries is a global customized piping solutions provider based in Louisville, KY. ISCO stocks and sells a wide variety of piping materials and provides solutions for various environmental, geothermal, golf, industrial, landfill, mining, municipal, nuclear, waterworks and culvert-lining applications worldwide. November 27th, 2019 Employee Stock Ownership Plan (“the Plan”), filed this Lawsuit against Wilmington Trust, N.A. 702 King Farm Boulevard, Suite 400, Rockville, MD 20850 / +1 212-944-4455 / Copyright ©2020 Asset International, Inc. All Rights Reserved. The alleged consensus view of the numerous executives present was that 2018 would be a stellar year financially in light of the continuation of trends that had emerged in the second half of 2017.“Of course, those forecasts necessarily would need to be reflected in any fair sales price for ISCO stock,” the complaint states. As of December 31, 2012, the ISCO shares purchased by the ESOP were revalued by an independent appraiser at $39 … According to the complaint, the plaintiff alleges that on Sept. 4, 2017, he was injured while in the course and scope of his employment with defendant when he tripped and fell into an improperly filled pothole. To learn more about a subscription A new Employee Retirement Income Security Act (ERISA) lawsuit has been filed in the U.S. District Court for the Western District of Kentucky, Louisville Division, naming a laundry list of defendants that includes various trusts, individuals and corporate entities. (Jimmy) Kirchdorfer, Jr., is the chair and CEO of ISCO, a company his father, James J. Kirchdorfer Sr., formed in 1962.

The Lawsuit claims that Wilmington Trust violated a federal statute, the Employee Retirement Income Security Act of 1974 (“ERISA”) in connection with the purchase of 4 million shares of ISCO Industries, Inc. (“ISCO”) stock by the Plan on or about December 20, 2012, for $98 million (the “ESOP Transaction”).

{¶1} Plaintiffs-appellants ISCO Industries, Inc., and ISCO Canada, Inc., (collectively "ISCO") appeal the dismissal of their complaint against their insurer, defendant-appellee Great American Insurance Company ("Great American"), arising from Great American's refusal to provide coverage with respect to a lawsuit and settlement between ISCO and a third-party Canadian corporation. ISCO Industries sponsors the ESOP and Wilmington Trust is its trustee. Best says the defendants manipulated the transaction’s timing and purchase price so that participants would miss out on gains from the company’s “record-breaking financial results” in 2018 and 2019.Best also claims the executives replaced the stock plan’s original trustee, Wilmington Trust NA, in favor of a “local CPA with little experience.” This was done because of Wilmington’s “hesitation to approve the buyback” that was being pushed by the defendants, Best claims.Best’s lawsuit comes four months after Wilmington—which isn’t named as a defendant in this case—To contact the editors responsible for this story: The Court documents can be viewed on the Case Documents page.