The Del-Air lawsuit is a federal class action filed in March 2023 in the Middle District of Florida by employee-owners of Del-Air Heating, Air Conditioning and Refrigeration, who allege that company directors, the plan’s independent trustee, and private equity firm Astara Capital Partners breached their ERISA fiduciary duties by ending the company’s Employee Stock Ownership Plan in a 2022 sale that valued the ESOP’s stock at $18.5 million — roughly $20 million to $30 million below what plaintiffs say it was worth. The case, Ovalle v. Barton, No. 6:23-cv-551-CEM-RMN, is being litigated on behalf of all ESOP participants and seeks about $50 million in damages.
What the 2022 Sale Did to the ESOP
Del-Air had been fully employee-owned since 2015. Two ESOP transactions in 2005 and 2015 transferred 100% of the company’s stock to the plan for a combined $44.7 million, and by the end of 2020 the ESOP’s holdings were valued at $45.8 million. The company had more than 1,000 employee-owners and annual revenue of at least $140 million.
On or around October 28, 2022, Del-Air’s board approved a recapitalization that effectively terminated the ESOP. Astara Capital Partners, a New York private equity firm founded in 2020 by Michael Ranson, acquired a 76% stake, and the deal closed in early November 2022. The ESOP’s entire stake was valued at $18.5 million in the transaction. The plan kept a 24% minority interest as “Class C” units that pay nothing until Astara recoups its full investment. All ESOP participants were treated as having terminated employment, the plan was closed to new participants, and remaining accounts are scheduled to be distributed by 2028.
According to the complaint, after roughly $23 million in debt was paid off at closing — including $9 million owed to founder’s widow and board member Diane Dello Russo — and transaction costs were covered, only about $4 million in cash was actually available for distribution to ESOP participants.
Who Is Suing Whom
The class representatives are ten current or former Del-Air employees who held ESOP accounts: Julissa Ovalle, Lynne Cassani, Angel Buitrago, Michael Mize, Cynthia Medina, Wiltron Diaz, Jerry Raymond, Angel Soto, Thomas Cannetti, and Blaine Ifill. They are represented by the law firm Engstrom Lee.
The defendants fall into three groups:
- The director defendants: Howard “Chad” Barton, Diane Dello Russo, Donald “Richard” Fortin (the board chairman), Charles Brinkley, and Tony Hartsgrove.
- James Urbach, named as the plan’s independent ESOP trustee.
- Astara Capital Partners Fund I, L.P., the investment fund that acquired Del-Air.
Del-Air itself, as plan administrator, is also named.
What the Plaintiffs Say Went Wrong
The amended complaint characterizes the deal as a “fire sale” that violated the ERISA duties of loyalty and prudence. Its core allegations:
- Undervaluation. Given Del-Air’s 2020 valuation of $45.8 million, revenue of at least $140 million, and industry-standard revenue multiples, the ESOP’s stock should have been worth $40 million to $50 million or more in 2022. Receiving $18.5 million was, plaintiffs say, roughly a 60% discount.
- Self-dealing by Chad Barton. Barton sat on the Del-Air board from June 2021 to October 2022 and was a business partner of the late founder. Plaintiffs allege he “played both sides,” acting as a Del-Air fiduciary while also being an investor and operations-team member on the Astara side, and orchestrated the transaction so that he and his Astara co-investors could buy the company cheaply.
- A loan repayment steering the structure. Diane Dello Russo sat on the board and was also a company creditor. The complaint alleges the deal was structured in part to ensure she received immediate, full repayment of $9 million in loans owed to her by the company and the ESOP.
- No market check. The board allegedly never solicited competing bids.
- Trustee passivity. Urbach, who had served as the plan’s independent trustee since about 2012 and controlled approximately 74% of the voting shares, is accused of rubber-stamping the deal, relying on information from conflicted management, and sending participants a notice that effectively discouraged opposition.
- Corporate waste. Plaintiffs allege leadership backed by the Astara Fund permitted mismanagement that caused EBITDA to decline in the years before the sale, making a discounted price easier to justify.
The complaint also alleges that Hartsgrove served as an advisor and due-diligence agent for Astara while sitting on Del-Air’s board, funneling information about the company’s weaknesses to the buyer in exchange for consulting fees and incentive compensation.
Del-Air, when the parallel state-court suit was first filed in Seminole County in October 2022, responded through counsel Tucker Byrd of Byrd Campbell that the valuation had been conducted by an independent appraiser and that the process “functioned as intended to reach a fair transaction.”
What the Plaintiffs Are Asking For
The class seeks approximately $50 million in damages, a figure it says represents more than 80% of the retirement benefits lost. Plaintiffs also want the current fiduciaries removed, disgorgement of profits made from the transaction, and an injunction barring the Astara Fund from acquiring the ESOP’s remaining 24% Class C stake when accounts are liquidated by 2028.
Where the Case Stands
As of mid-2026, the federal class action remains active. Engstrom Lee has filed a First Amended Complaint on behalf of the class, and the case continues in the U.S. District Court for the Middle District of Florida.
The earlier state-court suit, filed October 28, 2022, in Seminole County by five Del-Air employees represented by John Zielinski, Richard Smith, and Mark NeJame, made similar allegations that the ESOP’s stock had been devalued by roughly 66% before the sale and sought an accounting of the valuation and any side agreements.
The SLAPP Suit Against Ross Johnston
Del-Air, Tony Hartsgrove, Chad Barton, and a former Del-Air general counsel separately sued Ross Johnston, a Florida small business owner who ran a 2024 public awareness campaign questioning the Astara sale and what he called the “suspicious” wind-down of the ESOP. They brought claims of defamation and injurious falsehood.
In April 2025, a Florida court dismissed the claims against Johnston, ruling the lawsuit was a “textbook SLAPP” — a Strategic Lawsuit Against Public Participation — and finding that his speech addressed a constitutionally protected matter of public concern. The court ordered the plaintiffs to pay Johnston’s legal fees and costs. The plaintiffs dropped the remainder of the case on June 17, 2025, three days before Hartsgrove was scheduled to be deposed.
Prior ESOP Cases Involving Trustee James Urbach
The Del-Air case is not the first ESOP-trustee suit naming Urbach. In Gamache v. Hogue, No. 1:19-cv-00021, plaintiffs alleged that Urbach voted ESOP shares in favor of a 2011 refinancing of Technical Associates of Georgia that diluted the plan’s ownership without adequate analysis of whether the transaction served participants. That complaint also noted that a search of Florida Bar records did not list Urbach as a licensed attorney in Florida, despite his purporting to maintain a law practice near Jacksonville.
Urbach was also a defendant in Bolton v. Inland Fresh Seafood Employee Stock Ownership Plan, No. 1:22-cv-04602-AT (N.D. Ga.), where plaintiffs alleged a 2016 sale of the company to its ESOP for $92 million was overpriced. That case was dismissed after the court found the plaintiffs had not exhausted the plan’s internal remedies before suing.