Adams and Associates, Inc. ESOP ERISA Litigation

Foster, et al. v. Adams and Associates, Inc., et al., No. 3:18-cv-02723-JSC (N.D. Cal.)

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Status of Settlement Distributions as of June 7, 2022:

On April 13, 2022, the Settlement became final and non-appealable.

On May 31, 2022, the Settlement Administrator mailed checks to class members who were eligible for an immediate distribution and timely submitted an Election Form to elect such distribution by a check payable to the class member—i.e., not through a rollover to a retirement account of the class member’s choice. For class members who were eligible for an immediate distribution and submitted an Election Form to elect such distribution through a rollover to a retirement account of the class member’s choice, the Settlement Administrator (a) mailed a check to the retirement account if the class member provided an address for the retirement account; or (b) mailed a check payable to the retirement account to the class member so that he or she can deposit it into the retirement account.  

If you were eligible for an immediate distribution and submitted an Election Form and have questions regarding the status of your cash distribution, please contact the Settlement Administrator at (866) 742-4955 or

For class members who (a) were eligible for an immediate distribution but did not submit an Election Form or were not eligible for an immediate distribution and (b) are current participants of the AAI 401(k) Plan, their settlement payments will be deposited into their existing 401(k) Plan account. If they are not already participants in the AAI 401(k) Plan, a 401(k) Plan account will be created for them. Please contact the Plan Administrator, Adams and Associates, Inc., at (775) 348-0900 if you have questions about the AAI 401(k) Plan including the status of your distribution to the AAI 401(k) Plan and how to update your investments.

For questions about settlement procedures or forms, and information about you including the amount of your vested shares in your ESOP account, please contact Settlement Administrator:

You may contact the Settlement Administrator at the following address, email or toll-free telephone number:

Adams ESOP Class Action Settlement Administrator
RG/2 Claims Administration LLC
P.O. Box 59479
Philadelphia, PA  19102-9479
Toll-Free: (866)742-4955
Facsimile: (215)827-5551

For additional information about the settlement, please visit  

For questions about the terms of the AAI 401(k) Plan, please contact Plan Administrator for the AAI 401(k) Plan: 

Adams and Associates, Inc.
10395 Double R Blvd
Reno, NV 89521
(775) 348-0900

The Plan recordkeeper/consultant is:

Principal Financial Group
711 High Street
Des Moines, IA 50392

For Questions about the Lawsuit or the Settlement Overall (and if the Settlement Administrator cannot answer your questions), Contact Class Counsel by email at

Summary of the Lawsuit

This lawsuit alleged that Adams and Associates, Inc. and other fiduciaries of the Adams and Associates, Inc. Employee Stock Ownership Plan (“Adams ESOP” or “the Plan”) violated ERISA and breached their fiduciary duties with respect to a transaction in or around September 2012 in which 100% of the stock of Adam and Associates, Inc. was sold to the ESOP.

Summary of the Claims

The Complaint alleged that the Defendants, including the ESOP trustee who was convicted of stealing money from other ESOPs, breached their fiduciary duty in causing the ESOP to pay Roy and Leslie Adams more than fair market value for the Adams and Associates company stock.

 Additionally, the Complaint alleged breaches of fiduciary duty related to the Defendants’ failure to properly investigate the ESOP trustee and monitor the trustee’s activity. Had Defendants properly investigated and monitored the trustee, they would have discovered the trustee was accused of embezzling funds from another ESOP at the time of the 2012 transaction. The Complaint alleged that Defendants further breached their fiduciary duty in failing to properly disclose the nature of the trustee’s criminal activity to ESOP participants and to take appropriate action.

Class Action Allegations

This lawsuit was certified on behalf of the following class:

All participants of the Adams and Associates ESOP from October 25, 2012 to December 31, 2020 who vested under the terms of the Plan and those participants’ beneficiaries.

Excluded from the Plaintiff Class are Defendants and their immediate family, any fiduciary of the Plan; the officers and directors of Adams and Associates or of any entity in which a Defendant has a controlling interest; and legal representatives, successors, and assigns of any such excluded persons.

Status of the Litigation

The Complaint was filed on May 9, 2018. Defendants filed a Motion to Dismiss the Complaint on July 30, 2018. The Court denied the Motion to Dismiss on February 26, 2019.

Plaintiffs filed an Amended Complaint on October 22, 2018. Plaintiffs filed a Second Amended Complaint on March 5, 2019.

On June 27, 2019, Plaintiffs filed a Motion for Class Certification, which the Court granted on September 11, 2019.

Plaintiffs filed their Motion for Partial Summary Judgment with respect to the fiduciary duty to monitor and prohibitive transaction claims on January 30, 2020. Defendants filed their Motion for Summary Judgment on all claims on April 9, 2021. A hearing was held on the parties’ cross-motions for summary judgment on May 14, 2020. The Court denied Plaintiffs’ Motion and granted in part and denied in part Defendant’s Motion on July 6, 2020.


After several meetings with a mediator, the parties reached a settlement in principle on behalf of the Class on July 29, 2021.  

The Settlement requires Defendants (other than AAI) to pay $3 million to resolve the claims and to also provide additional non-monetary relief, including issuing a new SPD.  After subtracting court-approved attorneys’ fees, expenses and class representative service awards, the remaining amount of the $3 million settlement payment will be distributed to the participant Class members (and beneficiaries who would be entitled to payment under the terms of the Plan). 

On September 24, 2021, Plaintiffs filed the Motion for Preliminary Approval of Settlement and the formal Settlement Agreement with the Court. The settlement needs to be approved by the Court, which consists of a three part process: (1) the Court granting preliminary approval of the settlement, (2) formal notice mailed to class members and class members will be provided with the ability to comment on the Settlement, and (3) the Court granting final approval of the settlement. 

The Court granted the Motion for Preliminary Approval on October 21, 2021 and ordered that notice of the settlement be sent to the Class by November 11, 2021. The Court set December 2, 2021 and January 13, 2022 as the respective deadlines for Plaintiffs’ motion for attorneys’ fees and costs and motion for final approval and scheduled the final fairness hearing for February 17, 2022.  

The Court granted the Motion for Final Approval and Motion for Attorneys’ Fees on February 11,2022 without hearing and vacated the final fairness hearing that was previously set.  

The settlement became final and non-appealable on April 13, 2022. Class Counsel and the Settlement Administrator have worked to distribute the settlement proceeds to members of the Class. For class members who were eligible for an immediate distribution and timely elected such distribution, the Settlement Administration issued their cash distributions on May 31, 2022. Your patience is appreciated. This website will be updated. Contacting Class Counsel to simply inquire about the date for payment slows down the process.

Whom to Contact for More Information

If you are a member of the proposed class or you have information which might assist us in the prosecution of these allegations, please contact one of the following persons:

R. Joseph Barton, Esq. (
Ming Siegel, Paralegal (
Block & Leviton LLP
1633 Connecticut Ave. NW, Suite 200
Washington DC 20009
(202) 734-7046 

Vincent Cheng, Esq. (
Block & Leviton LLP
100 Pine Street, Suite 1250
San Francisco, CA 94111
(415) 968-8999

Block & Leviton is co-counsel in this litigation with Feinberg Jackson Worthman & Wasow LLP.

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