Oakhurst Dairy: The Natural Goodness of an Enduring Legacy
The Bennett Family
L to R: Jean Bennett Driscoll, William P. Bennett, Mary Ellen Bennett Tetreau, Priscilla Bennett Doucette, Althea Bennett McGirr, John H. Bennett
When Stanley T. Bennett opened Oakhurst Dairy in 1921, he laid the groundwork for what would grow to become an iconic multi-generational family-owned business with a reputation for innovation, community service and environmental stewardship. His family successfully ran the business for three generations. In 2013, the family made the decision to sell the company to Dairy Farmers of America, Inc. (DFA), a $12 billion cooperative. A team of Verrill attorneys worked closely with the Bennetts throughout the complex merger negotiations which lasted more than six months and involved multiple potential acquirers. Many legal issues required attention beyond the agreement negotiations, and Verrill had the breadth and depth of experience to take them on. Our team provided counsel relating to federal antitrust review, taxation and benefits issues, intellectual property, environmental permitting and real estate interests.
Oakhurst's numerous dairy products have been a household staple in New England for generations. The Bennett family was thrilled to have the partnership opportunity presented by DFA, with its national presence, complementing culture and values, and financial strength. As a result of the sale, none of Oakhurst's 200 employees lost their jobs, the company will continue to get its milk from the 70 independent Maine farmers who supply Oakhurst's milk, and the integrity of the product will be maintained. Verrill was honored to work with this iconic company in ensuring its legacy will endure and the dairy will remain a vibrant member of the local economy for generations to come.
Cash Balance Conversion of Pension Plan
Eric Altholz worked with long time client Maine Medical Center to convert its defined benefit pension plan to a cash balance plan. This complex project took many months and included a complete restatement of the plan document, extensive written communications to employees, and both corporate and fiduciary governance processes. Eric worked closely with the hospital's senior HR staff and in-house counsel, as well as actuaries and consultants at Towers Watson throughout the project.
Chapter 7 Representation of Trustee
A converted Chapter 11 case for two debtors who between them employed several hundred employees. The largest secured creditor was owed approximately $30 million. This representation involved a number of complex matters. For example, immediately it was necessary to terminate a self-funded health plan and oversee the unwinding of that health plan. In addition, Verrill is in the process of coordinating the termination of two 401(k) profit sharing plans. Counsel also negotiated an agreement with the largest secured creditor to allow the Trustee to conduct asset sales of the tangible assets of both Debtors. Counsel is now coordinating the collection of accounts receivable. In addition, a seven-figure dispute with an insider relating to the perfection of its claimed consignment interest in inventory of one of the Debtors is now the subject of a pending adversary proceeding. Numerous employee claims are in the process of being evaluated and addressed arising from the Debtors' decision to terminate virtually all of their employees prior to conversion of the cases. Verrill is also evaluating a number of claims against insiders, and it is anticipated that claims arising under Delaware law will be pursued.
In representing the Trustee in this matter, Verrill sought the assistance of attorneys in the Employee Benefits & Executive Compensation Group relating to what has been described by the administrator for the 401(k) profit sharing plans as the largest plan termination matter being handled by her company right now.
The work for the Trustee in the Wood Structures case is ongoing and will not be completed for some time.
Comment Letter to Federal Agency
We worked with a group of clients to submit a comment letter to the Department of Labor's Employee Benefits Security Administration in response to EBSA's Request for Information regarding electronic distribution of employee benefit plan information under ERISA. The group of clients comprised a cross-section of business types and sizes and included for-profit and tax-exempt entities. Drawing on input from individual clients and our own years of experience, we prepared a comment letter that provided EBSA with practical information and concrete recommendations for improving the electronic disclosure regulations.
Commercial Health Insurance Product
Our client, a diverse health care company that offers both health plans and primary care services, sought our assistance in developing and implementing an innovative health care benefit product for an association of employers. Toward that end, attorneys at Verrill assisted in creating and licensing a captive insurance company, third party administrator, and preferred provider network. This comprehensive licensing process involved analysis and advice with respect to multiple filings with the Maine Bureau of Insurance; analysis of ERISA and State insurance laws related to enrollee disclosures, plan design, plan document preparation, and plan administration (including policy review); all aspects of intellectual property protection, provider contracting, and network adequacy; and included extensive work surrounding HIPAA and health information technology. In essence, we were intimately involved in building a commercial health benefit plan from the ground up.
Data Breach Response
We assisted a large company in responding to a data breach involving the inadvertent disclosure of information by a third party vendor. The company's vendor disclosed personal information for over 1,500 individuals when the vendor transmitted data to a second vendor. The affected individuals resided in 42 different states and 1 foreign country. We advised our client regarding its federal and state reporting and notification obligations, negotiated a coordinated response with the vendors involved, prepared incident reports for state agencies, and provided assistance in moving the vendor's investigation to completion. We also advised our client as to best practices in responding to a breach, helped design a communications strategy, and prepared notification letters to affected individuals.
Dispute with Service Provider
Due to our experience and skill in the area of benefits and compensation we were retained by another Portland law firm to assist with a dispute regarding services provided to client by an actuary relating to retirement plan design and administration. Our participation in this matter involved advising on all phases of the controversy (facts, analysis, legal claims, strategy, drafting of correspondence with opposing counsel and complaint). Being retained by another firm to assist with this matter highlights the strength of Verrill's Employee Benefits & Executive Compensation Group.
Fiduciary Governance Structure for ERISA Plans
Eric Altholz was asked to review this client's fiduciary governance structure and recommend any changes needed to enhance the fiduciary compliance status of the organization with respect to ERISA plans. This project ultimately involved the preparation board and committee resolutions implementing changes to the fiduciary governance structure, the preparation of a new plan administrative committee charter and extensive education of plan fiduciaries regarding their obligations under ERISA. Since that time, this organization has become a core employee benefits and executive compensation client of the firm.
HeadInvest: Management Buyout
Androscoggin Savings Bank bought HeadInvest, an investment advisory firm, and held it as a wholly-owned subsidiary for many years. It decided that the business was not a good fit for it and agreed to sell the business to the then-existing management. We advised the management group on establishing an acquisition vehicle, negotiating a new lease for office space and in negotiating and closing the deal (including seller financing).
Implementation of Health Savings Account
We provided comprehensive advice to our client regarding its implementation of a high deductible health plan with a Health Savings Account (HSA) feature. This project involved analyzing and communicating to the client the complex interplay between HSAs and other benefit options, advising on plan design, writing plan documents and disclosures, and reviewing written communications to employees.
Our attorneys reviewed all benefit plans and advised with respect to Microsoft issues and legal risk with respect to reclassified employees. We also provided legal advice with respect to employment tax issues related to reclassified workers. This matter required careful analysis regarding whether individuals were contractors or employees.
Multi-Disciplinary Representation in Mill Purchase and Regulatory Compliance
We represented the buyer in the acquisition of Domtar Maine LLC, which owns and operates the pulp mill in Baileyville, Maine (also known as Woodland), and continue to represent the mill in regulatory compliance matters. The mill produces about 395,000 metric tons of pulp a year, and is Washington County's largest employer with about 300 employees. It also has significant hydroelectric generating assets, with surplus power being sold to New Brunswick Power.
Verrill acted as co-counsel with O'Melveny & Myers.
Our representation included extensive due diligence and contract negotiation, and we relied upon our extensive experience in real estate, pension and benefits, labor and employment (several unions are involved with the mill), energy (including FERC), environmental law, commercial finance, tax and intellectual property.
Restatement of Change in Control Agreements
Although this publicly traded company uses a large Boston law firm for M&A and corporate securities work, Verrill's has served as the company's employee benefits and executive compensation legal adviser for more than 12 years. The company turned to Eric Altholz to review and update its executive change in control agreements. This project involved both highly technical analysis of applicable tax law, as well as extensive work with the company's senior HR staff and in-house counsel to assure that the company's goals were met within the compliance parameters that apply to these arrangements.
Retirement Plan Governance Structure
This project is a comprehensive review of virtually all aspects of our client's global retirement plans' governance, including structure, documentation, policies and processes, measured against both governing law in multiple jurisdictions and best practices in those same jurisdictions. This matter is significant due to the scope and complexity of the project as well as the international nature of the client. The client's ERISA plans melded governance of U.S. plans with those of several other countries. The plans also need to provide for system absorption of additional sizeable plans in the course of corporate acquisitions.
Retirement Plan Restructuring
Our client required an atypically complex restructuring of their retirement program to account for multiple classifications of medical and non-medical personnel at this tax-exempt employer, and the employer's desire to phase in both the freeze and plan changes, and to afford affected current plan participants an election between existing and new benefits. Our representation in this matter involved providing full analysis of legal compliance of design proposed by consulting firm, working with the employer and consultants to address legal issues and complexities and drafting new plan documents and summary plan descriptions.
Sale of Integrated Process Technologies, Inc. to Lewa-Nikkiso America Inc.
Integrated Process Technologies, a Massachusetts based company specializing in the engineering, design, and manufacture of high purity process systems, and its related entities were acquired by LEWA-NIKKISO AMERICA, INC., a US subsidiary of a Japanese public company, based in California. This transaction involved complex issues including patents, proprietary technology with third party rights, environmental and real estate issues, in addition to the typical due diligence matters involved with an acquisition. Verrill's Business & Corporate Group handled the negotiation of the purchase documents, and the firm's Intellectual Property Group advised on all of the patent issues. Verrill's Environmental, Real Estate, Labor & Employment, and Employee Benefits & Executive Compensation Groups also advised.
Sale of Medicaid Managed Care Plan
We represented our client in the sale of assets of a 501(3) tax exempt Medicaid managed care plan to a 501(c)(4) Managed Care Plan.
Our representation of this client involved providing advice throughout the negotiation on corporate, labor, benefits and regulatory issues. Members of Verrill's Labor & Employment, Employee Benefits & Executive Compensation and Health Care Groups worked in conjunction with the M&A Group on the matter.
Sale of Teaching/Community Hospital
We represented this client in the sale of their teaching/community hospital to the teaching hospital of a major university. Our client has annual sales over $500 million. An interesting aspect of this matter is that it involves the sale of a Catholic institution to a secular academic medical center, while maintaining the Catholic heritage on the client's site.
We are representing our client on corporate, Catholic, employee benefit and related issues. Verrill's Labor & Employment, Bankruptcy, Employee Benefits & Executive Compensation and Health Care Groups are working in conjunction with the M&A Group on this matter.