United States District Court, D. Maryland
FREIGHT DRIVERS AND HELPERS LOCAL UNION No. 557 PENSION FUND, By its Plan Sponsor, the Joint Board of Trustees Plaintiff,
PENSKE LOGISTICS LLC, et al., Defendants.
ELLEN LIPTON HOLLANDER, District Judge.
This is an action under the Employment Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001, et seq., and the Multiemployer Pension Plan Amendments Act of 1980 ("MPPAA"), 29 U.S.C. § 1381-1453. Suit was initially "brought on behalf of the Freight Drivers and Helpers Local Union No. 557 Pension Fund" (the "Fund"), a multiemployer pension plan, "by its Trustee, William Alexander." See Complaint, Caption & ¶ 1 (ECF 1). However, after the Court ruled that the Trustee lacked statutory standing to bring an action under 29 U.S.C. § 1401(b)(2), see Memorandum Opinion (ECF 13), an "Amended Complaint" was filed on August 7, 2013, ECF 15, also on behalf of the Fund, but this time by "its Plan Sponsor, the Joint Board of Trustees." See Am. Compl., Caption & ¶ 1.
Pursuant to 29 U.S.C. § 1401(b)(2), plaintiff seeks to vacate and/or modify an arbitrator's dismissal of the its claim for "withdrawal liability, " which it had lodged against two contributing employers, Penske Logistics, LLC ("Penske Logistics") and Penske Truck Leasing Co., LP ("Penske Leasing") (collectively, "Penske"), defendants. Am. Compl. ¶ 1.
Defendants filed a "Motion to Dismiss, or, in the Alternative, Opposition to Amended Complaint' Pursuant to Local Rule 105" ("Penske Filing, " ECF 16), supported by a memorandum of law ("Memo, " ECF 16-1). Penske argues that plaintiff's "Amended Complaint" is procedurally improper because ERISA and MPPAA require plaintiff to submit his filing in the form of a motion to vacate rather than as a complaint. Accordingly, Penske seeks dismissal of the Amended Complaint. Penske also argues that, even if the Amended Complaint is construed as a motion to vacate, it should be denied because it is untimely, unsupported, and without merit.
The Penske Filing was fully briefed,  and no hearing is necessary to resolve it. See Local Rule 105.6. For the reasons that follow, I will construe the "Amended Complaint" as a motion to vacate, and I will deny it.
ERISA provides a "comprehensive and reticulated" statutory framework for the administration and regulation of employee pension plans. Massachusetts v. Morash, 490 U.S. 107, 113 (1989). Its regulatory scheme is guided by a specific purpose:
"[T]o ensure that employees and their beneficiaries would not be deprived of anticipated retirement benefits by the termination of pension plans before sufficient funds have been accumulated in [them].... Congress wanted to guarantee that if a worker has been promised a defined pension benefit upon retirement-and if he has fulfilled whatever conditions are required to obtain a vested benefit-he will actually receive it."
Concrete Pipe & Prods. of Cal., Inc. v. Constr. Laborers Pension Trust for S. Cal., 508 U.S. 602, 607 (1993) (quoting Connolly v. Pension Benefit Guar. Corp., 475 U.S. 211, 214 (1986)) (alterations in Concrete Pipe ). Among those pension plans subject to ERISA are "multiemployer plans, " like the Fund, "to which more than one employer contributes, " which are "maintained to fulfill the terms of collective-bargaining agreements." Concrete Pipe, 508 U.S. at 606; see 29 U.S.C. § 1301(a)(3) (defining "multiemployer plan").
As originally enacted, ERISA generated a peculiar incentive for employers that contributed to multiemployer plans. Specifically, the withdrawal of one employer from a multiemployer plan reduced a plan's "contribution base." Bd. of Trs., Sheet Metal Workers' Nat'l Pension Fund v. BES Servs., Inc., 469 F.3d 369, 374 (4th Cir. 2006). To compensate for the loss, the remaining employers were required to increase their "contribution rate." Id. Thus, "[a]s employers withdrew, the rising costs of continued participation in multiemployer plans increased the incentives for further withdrawals." Id. This, in turn, jeopardized the financial health of multiemployer plans. See Pension Benefit Guar. Corp. v. R.A. Gray & Co., 467 U.S. 717, 722 (1984).
To reduce the risk of employer withdrawals, Congress amended ERISA through the Multiemployer Pension Plan Amendments Act of 1980, 29 U.S.C. § 1381, et seq. Under the MPPAA, an employer that withdraws from a multiemployer plan "incurs withdrawal liability' in the form of a fixed and certain debt to the pension plan.'" Concrete Pipe, 508 U.S. at 609 (quoting R.A. Gray, 467 U.S. at 725). The amount is calculated according to various statutory provisions which are not at issue here. See generally Milwaukee Brewery Workers' Pension Plan v. Joseph Schlitz Brewing Co., 513 U.S. 414, 417-19 (1995) (explaining MPPAA's rules for calculating withdrawal liability). Generally speaking, "[a]n employer's withdrawal liability is its proportionate share of the plan's unfunded vested benefits.'" Concrete Pipe, 508 U.S. at 609 (citing 29 U.S.C §§ 1381, 1391); accord BES Servs., 469 F.3d at 374.
The "plan sponsor" of a multiemployer plan is charged with determining, providing notification of, and collecting an employer's withdrawal liability. See 29 U.S.C. §§ 1382, 1399(b); see also Concrete Pipe, 508 U.S. at 610. With respect to a multiemployer plan, the "plan sponsor" is defined as the "joint board of trustees" or, "if the plan has no joint board of trustees, the plan administrator." 29 U.S.C. § 1301(10); see, e.g., Bay Area Laundry & Dry Cleaning Pension Trust Fund v. Berbar of Cal., Inc., 522 U.S. 192, 197 (1997) (explaining that ERISA "places the calculation burden on the plan's trustees, " and that "[t]he trustees must set an installment schedule and demand payment").
An employer may challenge a plan sponsor's determination of withdrawal liability. See 29 U.S.C. § 1399(b)(2). Notably, "[a]ny dispute between an employer and the plan sponsor of a multiemployer plan" concerning withdrawal liability must be "resolved through arbitration." 29 U.S.C. § 1401(a)(1); see Concrete Pipe, 508 U.S. at 611; BES Servs., 469 F.3d at 375. In such an arbitration, any determination made by the plan sponsor as to withdrawal liability is "presumed correct unless the party contesting the determination shows by a preponderance of the evidence that the determination was unreasonable or clearly erroneous." 29 U.S.C. § 1401(a)(3)(A).
Pursuant to 29 U.S.C. § 1401(b)(3), "[a]ny arbitration proceedings under this section shall, to the extent consistent with this subchapter, be conducted in the same manner, subject to the same limitations, carried out with the same powers (including subpoena power), and enforced in United States courts as an arbitration proceeding carried out under Title 9." Title 9 of the United States Code contains the provisions of the Federal Arbitration Act ("FAA").
Judicial review of the arbitrator's decision is available to "any party thereto." 29 U.S.C. § 1401(b)(2). Specifically, 29 U.S.C. § 1401(b)(2), titled, in pertinent part, "civil action subsequent to arbitration award, " provides:
Upon completion of the arbitration proceedings in favor of one of the parties, any party thereto may bring an action, no later than 30 days after the issuance of an arbitrator's award, in an appropriate United States district court in accordance with section 1451 ...