Rycenga Employees File Suit


    GRAND RAPIDS — Former employees of Rycenga Homes Inc. have gone to federal court seeking reimbursement of more than $1 million in retirement funds that the company is accused of improperly withdrawing.

    The lawsuit claims Rycenga Homes violated the federal Employee Retirement Income Security Act when it withdrew employee 401(k) retirement funds. Rycenga Homes also is accused of continuing to withhold health premiums from employee paychecks even though health benefits lapsed in late August for non-payment, a violation of ERISA.

    In filing the lawsuit, attorney Brad Groom of the Muskegon law firm Parmenter O’Toole seeks to position the former employees to make a claim on any of the defunct company’s assets.

    “I am confident that we will obtain a judgment,” Groom said of the lawsuit. “In terms of ultimate recovery, I am less confident.”

    The lawsuit, filed Oct. 18 in federal court in Grand Rapids on behalf of 50 former employees, names as defendants Rycenga Homes, company President Ronald Retsema, and Edward D. Jones & Co., the custodian of the 401(k) funds.

    In a Sept. 29 letter to Rycenga Homes employees, Retsema acknowledged the company “borrowed” from the retirement fund and was trying to pay it back.

    Rycenga Homes’ attorney, Bob DeJong, has said the company used the funds to prop up the business that was struggling in the face of spiking raw material costs and a sluggish economy. Rising steel and lumber costs were the “death knell” for the company, which ceased operations this month.

    DeJong, who was traveling last week and responded via an e-mail inquiry, said he could not comment on the litigation since he had not seen the suit. Nor could he comment on the allegations made by Macatawa Bank.

    In addition to the lawsuit, Rycenga Homes is the subject of ongoing probes by local, state and federal investigators, including the FBI and the U.S. Department of Labor. Rycenga Homes is believed to be the commercial borrower involved in Macatawa Bank Corp.’s claims of fraud and misrepresentation surrounding a commercial loan that became impaired, costing the bank a $2.3 million charge against third quarter earnings.    

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