The Department of Labor has filed a lawsuit against Valencia, California-based Gruber Systems Inc. and its CEO John Hoskinson, saying that they caused the company’s employee stock ownership plan participants to lose money when the plan bought additional company stock at considerably more than fair market value in two transactions totaling $2.6 million.
The suit says that, instead of the money being put aside to fund the retirement accounts of Gruber retirees, it was channeled into the stock purchases to shore up the company during financial troubles.
Gruber provides molds, automation equipment, and supplies for the cast polymer and other composite-related industries.
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