Justia ERISA Opinion Summaries

Employers that withdraw from underfunded multiemployer pension plans must pay their share of the shortfall. They can seek recalculation of the plans' assessment within 90 days, 29 U.S.C. 1399(b)(2)(A), and within another 60 days, may invoke a process that the Act calls arbitration, though it is neither contractual nor consensual. Central States Pension Fund concluded that US Foods has withdrawn in part and assessed liability in 2008 and in 2009. US Foods timely requested arbitration of the 2009 assessment, but did not timely seek arbitration of the 2008 assessment. In the Fund’s suit to collect the 2008 assessment, US Foods asked the court to order the arbitrator to calculate the amount due for 2008 and 2009 jointly. The court ruled that US Foods had missed the deadline for arbitral resolution of the 2008 assessment. US Foods appealed, relying on 9 U.S.C.16(a)(1)(B), which authorizes an interlocutory appeal from an order “denying a petition under section 4 of this title to order arbitration to proceed”. The Seventh Circuit dismissed for lack of jurisdiction. An order declining to interfere in the conduct of an arbitration is not an order “denying a petition under section 4 of this title to order arbitration to proceed” under section 16(a)(1)(B). View "Cent. States SE & SW Areas Pension Fund v. US Foods, Inc." on Justia Law

The employers were formerly contributing members of the Teamsters Local Union No. 293 Pension Plan. In 2007-2008 each employer reached an agreement with the Plan to terminate its membership. They were required to pay, and have paid, “withdrawal liability” reflecting each employer’s share of unfunded, vested pension benefits under the Multiemployer Pension Plan Amendments Act, 29 U.S.C. 1381–1461. Under the Act, if the plan is terminated altogether by a “mass withdrawal” of the remaining members within three years, the earlier withdrawing members may be subject to additional “reallocation liability.” Disputes about the amount of such reallocation liability are subject to mandatory arbitration. The employers claim that a 2009 mass withdrawal was expedited to occur within the three-year period in order that they would be subject to reallocation liability. The Plan trustees sought more than $12 million in additional funds from the employers. The district court dismissed their suit for failure to complete arbitration. The Sixth Circuit affirmed. The Act requires that the claim of “sham” mass withdrawal be arbitrated. View "Knall Beverage, Inc. v. Teamsters Local Union No. 293 Pension Plan" on Justia Law

IPS appealed the district court's denial of its motion to compel arbitration and stay plaintiffs' claims against it. Plaintiffs cross-appeal, disputing the preemption of their claims under the Employment Income Security Act (ERISA), 29 U.S.C. 1001 et seq., and alleging a lack of federal jurisdiction. The court found that jurisdiction was proper and affirmed the district court's denial of IPS's motion to compel arbitration. View "Ehlen Floor Covering, Inc., et al. v. Innovative Pension Strategies, Inc." on Justia Law

After two years of contributing to a multiemployer pension plan established under a collective bargaining agreement, the company closed the covered facility, triggering withdrawal liability. The union notified the company of its liability under the Employment Retirement Income Security Act of 1974, 29 U.S.C. 1001, as amended by the Multiemployer Pension Plan Amendments Act of 1980, 29 U.S.C. 1301-1461, and set a 20-year schedule requiring payment of $652 per month. The union sent another letter, months later, saying that it had miscalculated monthly payments, but not the underlying withdrawal liability, and advised the company to increase monthly payments to $978. The company timely paid the original amount, but refused to pay the revised sum. The company requested arbitration, but after a finding that it was not required to pay the higher amount in the interim, withdrew. The district court dismissed the union's suit based on the calculation. The Seventh Circuit reversed and remanded without reaching the statutory interpretation issue, based on failure to exhaust administrative remedies. A plan may correct perceived errors in calculation and revise an assessment as long as the employer is not prejudiced. At that point the exhaustion provisions of the MPPAA apply to the revised assessment as they would to the original. View "Nat'l Shopmen Pension Fund v. DISA Indus., Inc." on Justia Law

Defendant appealed from the district court's grant of summary judgment in favor of plaintiff, compelling arbitration of a dispute related to healthcare benefits under an expired collective bargaining agreement. At issue was whether the district court erred in granting plaintiff's motion for summary judgment and issuing an order compelling the arbitration. The court reversed and held that the district court erred in granting summary judgment and compelling arbitration where both parties vigorously disputed issues of both law and fact, including whether the 1994 agreement was ambiguous and whether the summary plan descriptions constituted an intrinsic or extrinsic evidence of the parties' intent. The parties also point to various other extrinsic evidence and vehemently disagree as to whether the bargained for fully-paid health insurance premiums for life or just for the term of the agreement. Under these circumstances, the court held that the question of whether the right to fully-paid premiums vested under the 1994 agreement was best decided in the first instance by the district court and therefore, remanded for further proceedings. View "Newspaper Guild of St. Louis v. St. Louis Post Dispatch, LLC" on Justia Law