High Country Times

Education and the Workforce Committee Chairwoman Virginia Foxx has called for an investigation into the Department of Labor (DOL) by the Office of the Inspector General (OIG). This request follows reports suggesting that DOL, under the Employee Benefits Security Administration (EBSA), may have shared confidential information with a plaintiffs' attorney. The data was allegedly used against plan fiduciaries.

Foxx expressed concerns in a letter, stating: “The Committee on Education and the Workforce (Committee) has learned that the [DOL] shared confidential information involving at least six employee benefit pension plans with a plaintiffs’ attorney. DOL’s [EBSA] gathered this confidential information during an investigation, and Michael R. Hartman, Counsel for DOL’s New York Regional Solicitor’s Office, shared this information with Cohen Milstein Sellers and Toll, PLLC (Cohen Milstein), a law firm known for pursuing class action lawsuits involving benefits plans, to use in a lawsuit against a fiduciary of the plans.”

She further noted: “[D]OL appears to be working in concert with plaintiffs’ attorneys to circumvent the discovery protections of the [Federal Rules of Civil Procedure] by conducting a fishing expedition under the guise of an EBSA investigation and then supplying confidential information to plaintiffs’ attorneys for use in private litigation against plan fiduciaries. … Those who have been targets of DOL investigations and class action lawsuits involving benefits plans have long suspected that DOL has secretly shared information with class action law firms to give them a leg up in federal litigation, although this appears to be the first time such a cozy relationship has come to light. When an employee benefits plan fiduciary shares information with EBSA pursuant to an investigation, the plan fiduciary should have no reason to fear the information will be back-channeled to a class action lawyer and used against it.”

The letter concluded by urging EBSA to protect confidentiality during investigations: “EBSA must immediately take steps to protect the confidentiality of information gathered during investigations and to reassure employee benefits plan fiduciaries that their cooperation during investigations will not lead to coercive actions from plaintiffs’ attorneys. The Committee requests that the [OIG] investigate this practice and publish a public report.”