U.S. Labor Department recovers $8.6 million for workers in settlement involving Agway...

U.S. Labor Department recovers $8.6 million for workers in settlement
involving Agway 401(k) plan in New York

NEW YORK, Oct. 23 /PRNewswire-USNewswire/ -- The U.S. Department of Labor has
obtained a settlement restoring $8,590,000 to participants of the Agway Inc.
401(k) plan in DeWitt, N.Y., and barring plan officials and the board of
directors from service to employee benefit plans for one to two years unless
they complete fiduciary training. The defendants also agreed to pay a civil
penalty of $859,000 plus interest to the Labor Department.

"This $8.6 million recovery is a victory for the workers whose retirement
savings were grossly mismanaged," said Secretary of Labor Elaine L. Chao.

The department's lawsuit resolved by this settlement alleged that 47 members
of the investment committee, administration committee and the Agway board of
directors violated the Employee Retirement Income Security Act (ERISA) by
allowing the 401(k) plan and its participants to invest in overpriced
securities of Agway. The investment committee allegedly failed to investigate
the prudence of investing in Agway securities, to determine the fair market
value of securities acquired by the plan (which was set by Agway), and to
monitor and divest the plan's holdings in the securities.

In addition, the administration committee allegedly allowed Agway and the plan
to give false and misleading information to participants about the investments
in Agway securities, while the board of directors failed to oversee the
activities of plan fiduciaries. Some of the defendants included a company
attorney, the director of trust investments and the chief executive officer of
Agway.

Agway Inc. filed for Chapter 11 bankruptcy in October 2002. The 401(k) plan
covered 4,080 participants as of June 30, 2002. The plan held approximately
$48 million in Agway securities and $2 million in cash reserves. An
independent fiduciary, Fiduciary Counselors Inc., was appointed in 2004 to
manage the plan and brought its own separate lawsuit.

The settlement, entered in the U.S. District Court for the Northern District
of New York, was investigated by the Boston Regional Office of the Labor
Department's Employee Benefits Security Administration (EBSA).

In fiscal year 2007, the department achieved monetary results of $1.5 billion
in pension, 401(k), health and other benefits for millions of American workers
and their families. Employers and workers can contact the EBSA office in
Boston at 617-565-9600 or toll-free at 866-444-3272 for help with problems
relating to private sector pension and health plans.

Chao v. Agway Inc. Employees' 401(k) Thrift Plan ERISA Litigation - formerly
Chao v. Magnuson
Civil Action Number 5:06-CV-1199

U.S. Labor Department releases are accessible on the Internet at
www.dol.gov/ebsa. The information in this news release will be made available
in alternate format upon request (large print, Braille, audio tape or disc)
from the COAST office. Please specify which news release when placing your
request at 202-693-7828 or TTY 202-693-7755. The Labor Department is
committed to providing America's employers and employees with easy access to
understandable information on how to comply with its laws and regulations.
For more information, please visit www.dol.gov/compliance.

SOURCE U.S. Department of Labor

Gloria Della, +1-202-693-8664, or Richard Manning, +1-202-693-4676, both of
the U.S. Labor Department