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| Employees of American Home Mortgage have filed a class action lawsuit against the company, claiming it failed to keep promises made when the company they worked for was acquired by American Home.
According to an announcement Friday from the law firms of Rosen Preminger & Bloom LLP; Clouse Dunn Hirsch LLP; and Feinberg, Renaker & Jackson, P.C., the plaintiffs were employed at Principal Financial Group’s residential mortgage unit. American Home reportedly acquired the operation in early 2003, and hired approximately 400 existing employees. In an unrelated deal, Citigroup purchased Principal Residential Mortgage Inc. in July. The employees claim their new employer agreed in writing to consider their time at the Principal in determining their vesting for American Home’s 401k plan and to contribute extra funds to the plan “to compensate the workers for an additional retirement benefit they had with their old employer.” But instead of keeping the promises, the employees allege American Home lengthened the required vesting time and never made the extra contributions. “They promised to keep our prior benefits in place and make us whole if we joined American Home,” plaintiff Bill Williams reportedly said. “And then they reneged on their promise.” The complaint was filed in Suffolk County, N.Y., according to the announcement. “This is a lawsuit being brought by only two individuals,” American Home spokesman John Lovallo told MortgageDaily.com. “One being a current employee, one being a former employee. “We think we’re on the right side of the issue,” Lovallo added — noting that the company, which doesn’t consider the lawsuit a material issue, does not normally handle legal issues via the media. |
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Sam Garcia has been in mortgage lending since 1980, and is publisher of MortgageDaily.com and MortgageChronicle.com. email:Â [email protected] |
