Académique Documents
Professionnel Documents
Culture Documents
and
under the building and construction industry exception in ERISA Sec 4203(b).
and Southwest Areas Pension Plan ("Plan"), decision is for the Company.
II. References
(2) Central States Pension Fund v Bellmont Trucking Co, 610 F Supp 1505,
6 EBC (BNA) 2001 (ND Ind, 1985); aff'd 788 F2d 428 (CA 7, 1986),
hereinafter "Bellmont Trucking". That case deals with the trucking industry
exception found in ERISA Sec 4203(d), which is related to the building and
construction industry exception at issue here.
(3) Fraser Shipyards, Inc and IAM National Pension Fund, 7 EBC (BNA)
2562 (Arb, 1986), hereinafter "Fraser Shipyards". That opinion discusses the
burden of proof in arbitrations under ERISA Sec 4221 and addresses current
1
"ERISA" is the acronym for the Employee Retirement Income Security Act of 1974, PL 93-406, 88 Stat 832, as
amended, which is codified in scattered sections of 5, 26 and 29 USC. The portions relevant here may be found in
29 USC Secs 1001 et seq., particularly Secs 1381-1405.
constitutional issues.
This case arises under Section 4203 of ERISA, Subsection (b) of which
(1) [I]n the case of an employer that has an obligation to contribute under
a plan for work performed in the building and construction industry, a
complete withdrawal occurs only as described in paragraph (2), if --
(A) substantially all the employees with respect to whom the employer
has an obligation to contribute under the plan perform work in the
building and construction industry,
and
(B) the plan--
(i) primarily covers employees in the building and construction
industry,
or
(ii) is amended to provide that this subsection applies to
employers described in this paragraph.
(2) A withdrawal occurs under this paragraph if --
(A) an employer ceases to have an obligation to contribute under the
plan,
and
(B) the employer --
(i) continues to perform work in the jurisdiction of the
collective bargaining agreement of the type for which
contributions were previously required,
or
(ii) resumes such work within 5 years after the date on which
the obligation to contribute under the plan ceases, and does not
renew the obligation at the time of the resumption.
incorporated into the Plan by reference in Section 1 of Appendix E [FX 5 & 14].
this arbitration are the meaning of "building and construction industry" and
"substantially all"; the meaning of "primarily" need not concern us because the
Question (1) is not at issue here because the Central States Plan, although
mixed (see, e.g., Bellmont Trucking, 610 F Supp 1506-1507; 6 EBC 2001-
However, question (2) is the key issue with respect to the Company, as much of
its work was off-site. Question (3) is a lesser issue because all available data
For purposes of the instant matter, it is important to note the emphasis placed
upon work on-site and the language chosen to implement that emphasis,
because the language of the Central States Plan is different. It also is important
"Under NLRA section 8(f), 'building and construction industry' has been
interpreted to exclude employers who manufacture and assemble
products which are subsequently installed by the employees of other
employers at the construction site. In a section 8(f) case, the NLRB
underscored the importance of actual on-site work to the definition:
"‘*** the so-called building and construction concept subsumes
the provision of labor whereby material and constituent parts may be
combined on the building site to form, make, or build a structure.’" 47
FR 42589 (footnotes omitted; first emphasis in PBGC Notice; second
emphasis in case cited).
noted:
published by the Office of Management and Budget. Under the SIC, "the
omitted). PBGC summarized the SIC discussion by commenting that "the SIC
definition of construction, like that under the Davis-Bacon Act and the NLRA,
definition of the building and construction industry and which are germane to
that employed in the Central States Plan:
between work on-site and off-site and that between work performed by
employee, level. Second, "supply" and "transportation" are separate and distinct.
Third, it encompasses work done off-site in conjunction with the supply and
the Plan definition, no two of which were alike. The official definition was
adopted at the Board of Trustees' meeting, March 16-17, 1982. On the written
agenda for that meeting was Item No. 17, the explanation for which stated:
The explanation made no mention of "supply" or "supplies" and did not qualify
a covered employer as a "principal" transporter of equipment and/or materials.
The minutes of the March 1982 Board meeting recite that the building
and construction industry Resolution was passed "[a]fter a full discussion." The
language of the Resolution was broader than the explanation of agenda Item No.
March 16-17, 1982 Resolution begins, "WHEREAS, the Trustees of the Fund
desire to implement this rule in the broadest and most effective manner." In
opening statement, counsel for the Fund indicated that a "fairly broad" definition
was adopted [Tr 14] and the spokesman for the Fund corroborated counsel's
opening statement with his sworn testimony [Tr 65-66].4 The spokesman
testified that the definition was expanded because otherwise too few employers
At the Board's April 1982 meeting, confusion was compounded when the
units in the construction industry. The second paragraph of the letter stated:
Please note that the new rules *** exempt any employer in the
construction industry whose principal business is the contracting or
4
"Tr" denotes the hearing transcript.
subcontracting of work to be performed at a construction jobsite, or
whose principal business is the supply and/or transportation to and from
such jobsites of material, equipment, or supplies to be utilized by
construction workers. FX 23.
Thus, the model letter (dated April 21, 1982) introduced a requirement not
pertinent part:
*** FX 19.
The interpretive bulletin differs from the Plan's definition of "building and
From the foregoing, it can be seen that the Plan's definition of "building
and construction industry" has been a source of confusion from its inception.
The Fund has erred in applying the definition to the Company's activities in two
respects: (1) The Fund failed to consider the fact that part of the Company's
business was "the supply *** of material" and (2) the Fund incorrectly applied
the "substantially all" test of ERISA Sec 4203(b)(1)(A) to the Company's job
classifications.
business, and the work of its employees. For a quick introduction, it suffices to
Company:
The employees with whom we are mostly concerned here, i.e., those with
respect to whom the employer has an obligation to contribute under the plan for
work performed in the building and construction industry within the meaning of
series of collective bargaining agreements between the Company and Local No.
and Helpers of America, the last of which was introduced into evidence as part
of FX 7.
Job Classification/Duties
7. Laborer--Keep bins filled with sand and rock, and perform general labor
The sole issue is whether "substantially all the employees with respect to
whom the employer has an obligation to contribute under the plan perform work
in the building and construction industry" within the meaning of ERISA Sec
defined in Plan, Appendix E, Sec 7(b). Although the Company ceased to have
an obligation to contribute under the Plan within the meaning of ERISA Sec
4203(b)(2)(A), the parties agree that ERISA Sec 4203(b)(2)(B) will never be
satisfied because:
Thus, the Company qualifies for the building and construction industry
As was pointed out in the PBGC Notice, the term, "substantially all", is
not defined in ERISA. The Fund concedes that ERISA does not mandate that
the Fund utilizes an 85% test and the Fund argues only that such a test is not
where, as here, the sample size is small, e.g., fewer than 40 participants.
percentage test, it had no difficulty in formulating one; see, for example, ERISA
Sec 4205 ("70-percent contribution decline") and Sec 4209 ("3/4 of 1 percent
*** or $50,000"). As it is, Congress left to individual plans (or the PBGC) the
authority to adopt any reasonable measure of "substantially all"; one plan may
utilize an 82.5% test; another, a 90% test; still another, an increasing scale.
Having determined that ERISA does not require a percentage test, I must
agree with PBGC that the phrase, "substantially all", begs for quantification. 47
FR 42591. Indeed, I do not see how a plan sponsor could evaluate "substantially
although neither ERISA nor the Plan document provides for a percentage test,
Nor can the Fund be faulted for choosing 85%. Eighty-five percent is
about the only precise figure with any support among the authorities. See, for
example, PBGC Notice, 47 CFR 42591; Bellmont Trucking, 610 F Supp 1509-
Pension Plan Amendments Act of 1980," 71 Geo LJ 161, 167 & notes 52 & 53
(1982).6 Concededly, support for the 85% figure is based upon the meaning of
"substantially all" under the trucking industry exception of ERISA Sec 4203(d),
but "the same term, when used to describe the same legislative concern in the
same statutory title, should have a single meaning." T.I.M.E.-DC, Inc v N.Y.
Teamsters Pension Fund, 580 F Supp 621, 627, 5 EBC 1097, 1102 (ND NY)
6
To the extent that Bellmont Trucking concludes that "substantially all" must mean "at least 85%", 610 F Supp
1511-1512; 6 EBC 2006, I respectfully disagree.
[citations omitted]; aff'd per curiam 735 F2d 60 (CA 2, 1984). I conclude that
In applying the 85% test, the Fund staff obtained two sets of data, the first
from Mr. Joe Morele of Teamsters Local 769 and the second from Company
counsel:
Teamsters Counsel
Job Classification Data Data
Drivers 30 24
Batchermen 2 2
Yardmen (i.e., laborers) 3 or 4 --
Mechanics ___4___ 5__
Total 39 or 40 31 FX 12.
It is unclear what period of time these data cover, but the resolution of this
matter makes a finding unnecessary. The Fund itself brought out the fact that the
Company's work force was quite stable [Tr 158-161], so that data from any
reasonable period probably are representative; see, for example, the data
"primary focus" test [Tr 17, 214]. They examined each of the Company's job
sites [Tr 214-216]. The staff determined that only drivers had the primary
"support personnel" who were not included within the definition of "building
(1) Did the Fund staff have the authority to apply a "primary function"
test so as to exclude "support personnel"?
(2) If so, did the staff correctly apply the primary function test to the
Company's job classifications?
if not nonsensical. 7 EBC 2571 & n 19. The phrase, "the party contesting the
place the burden of persuasion as to fact and law on the party contesting the
52(a). 7 EBC 2571 & n 20. Under the federal rules, findings of fact shall not be
set aside unless the reviewer on the entire evidence is left with the definite and
firm conviction that a mistake has been committed. United States v United
States Gypsum Co, 333 US 364, 395 (1948). "Unreasonable" was related to
contesting the plan sponsor's determination must (A) prove to the arbitrator,
definitely and firmly, on the basis of the entire evidence, that a mistake has been
committed, or (B) convince the arbitrator that the determination is against
the matter before me, the Company has convinced me that the Fund's
Using the primary function test, the Plan's Withdrawal Liability Review
Committee determined "that 77% of the work performed by the bargaining unit
involved the transport of ready mix concrete" [FX 13]. According to Plan,
7
The Company cites the Proceedings of New York University Thirty-Sixth Annual National Conference on
Labor, R. Adelman, ed (Matthew Bender 1983) for the proposition that the presumption of ERISA Sec
4221(a)(3)(A) applies only to factual determinations and not to legal conclusions. In Chapter 11, "Arbitration
under the Multiemployer Pension Plan Amendments Act of 1980", Edwin M. Jones, Executive Director of the
Pension Benefit Guaranty Corporation, states:
In determinations that involve issues of both law and fact, the arbitrator shall separate the two issues and
apply the presumptions in favor of trustee determinations only to factual determinations. The arbitrator
should not attach any presumptions to legal determinations by the plan sponsor. Id., at 11-10 (footnote
omitted).
Mr. Jones' assertion was made without elaboration and with reference only to the statute itself and so
begs the question, which concerns the meaning of the statutory language. Until a more definitive analysis is
forthcoming, I will continue to apply the statutory presumption as explicated in Fraser Shipyards, 7 EBC 2568-
2573. Cf. Herman Segall, Inc and ILGWU Retirement Fund, 3 EBC 2449 (Arb, 1982) in which the arbitrator held
that the determination of withdrawal liability, "while not clearly erroneous, is unreasonable as a matter of law." 3
EBC 2455. This holding can be interpreted as implicitly corroborating the holding in Fraser Shipyards that the
words, "unreasonable or clearly erroneous", in ERISA Sec. 4221(a)(3)(A) establish a bifurcated standard of
arbitral review under which "clearly erroneous" applies to findings of fact and "unreasonable" applies to
conclusions of law.
by the Operations Director of the Fund. The Withdrawal Liability Review
liability which is timely made and the recommendation for decisions on such
the Fund's Plan Compliance Division and a member of the Withdrawal Liability
Review Committee, testified on behalf of the Fund. Mr. Frawley is not a Trustee
and does not customarily attend Board meetings. It appears that the primary
embodied in any document. Its use has not been approved by the Board of
Trustees; indeed, there was no evidence that the Trustees are even aware of its
and did not transmit to the Board the raw data on which the conclusion was
based or inform the Board that the data had been evaluated by utilizing the test
[FX 13].
On the record before me, I cannot find any basis for application of the
that the definition was intended to be expansive, and application of the test
serves only to narrow the intended exemption from withdrawal liability. There
The Fund stipulated that the Company's "principal business"9 was the
"supply and/or transportation to and from *** job sites of material *** to be
195-198]. In fact, "ready mixed concrete" is on the Fund's own list of building
President of the Company, and Philip V. Davis, who was with the Division for
employees were essential to its operations [Tr 151-152, 186, 205-206] and their
testimony was inherently credible. All of the job classifications for which
typically hardcore, Teamster-type work. If Mr. Knowles had urged that his
9
Mr. Frawley stated that he did not know the meaning of "principal", as the issue had never arisen before.
secretary was a covered employee and that the Company could not have gotten
along without her, there might be some room for skepticism, but he did not.
Rather, he restricted his testimony to key job classifications that were integral to
To get the flavor of the evidence before me, it is helpful to take a closer
and loaded into a cement truck for mixing and transport. Depending upon
and cement to be discharged from storage bins into a hopper which feeds into a
waiting mixer truck. But for the work of the batchermen, the Division could
neither supply nor transport concrete because its trucks would be empty.
Absent some formal basis for excluding batchermen from the 85%
calculation, their exclusion is unreasonable. The Fund could only repeat that
means clear that that is so because the batchermen loaded the trucks,10 and it is
even less clear that their "primary function" was not the "supply" of ready
mixed concrete. Indeed, it does not appear that the Fund even considered the
Division's role in the "supply" of concrete. Thus, for example, in its Preliminary
10
See Reply Brief of Central States, Southeast and Southwest Areas Pension Fund, p 9.
Statement [FX 28], the Fund says only that "[u]nder Section 7, employers
"supply". In its reply brief, the Fund nowhere addresses the issue of the supply
of concrete and states merely that "the Fund definition treats only the
"primary focus" was at the garage, not on the transportation of building material
[Tr 215]. However, the record does not support such a narrow analysis. There
might be some merit to the Fund's position if the mechanics serviced vehicles
from various industries but the evidence was undisputed that they serviced only
vehicles in the "building and construction industry". Mr. Knowles testified that
operation was to move concrete, not to maintain vehicles [Tr 186, 205-206].
At a time when the media abound with warnings about the dangers of unsafe
they are mere "support personnel". Under the "primary function" test, a heavy
through an express determination by the Fund's Board of Trustees and not the
governing withdrawal liability [e.g., Secs 4214(b), 4219(c)(7)] and the PBGC
12
E.g., 64 Barron's 26-27 (Aug 1984); 27 Handling & Shipping Management T1-13 (Mar 1986); 47 Insurance
Review 30-37 (June 1986); The New York Times, December 7, 1986, p 11; The Detroit News, April 14, 1987, p
1B; The Ann Arbor News, May 18, 1987, p 1A.
Notice has been excerpted at length to illustrate the breath of considerations that
industry". However, once a plan has adopted a specific definition, it must live
with it. The Central States Plan has done this, and the Fund staff has no
authority to modify or amend the definition which the Trustees selected. The
staff may apply the definition according to its terms, but they may not
Appendix E to the Central States Plan. Thus, the Company qualifies for the
"support personnel", they can do so by Plan amendment. They can exclude all
they have not done so, and the Fund's staff cannot usurp the Trustees' authority.
Trust Agreement, Art IV, Secs 9 & 14; Art V, Sec 2; Art VII, Sec 3; FX 18.
In its Post-Hearing Brief, the Fund makes four points which I address
seriatim:
V.A. The Fund has consistently treated only jobsite work and
transportation as building and construction industry work
First, the Fund seeks to deflect any issue over the term, "supply":
The Arbitrator has asked how the Fund interprets the word "supply" in
the second part of section 7(b). March 24, 1987, letter from E. Frank
Cornelius, Esq., to Ms. Patricia A. Velasco. Because Oolite did not raise
the supply issue and because the Arbitrator's question regarding the
meaning of supply came after the conclusion of the hearing, the Fund
offered no evidence regarding what was intended by the Trustees by their
inclusion of the word supply in section 7(b). Post-Hearing Brief, pp 27-
28.
Company President, quoted earlier, Mr. Knowles stated: "The sole business of
the Redimix Division *** was the supply *** of redimixed concrete ***. The
end product being supplied *** was prepared by Redimix Division employees
***" (emphasis supplied). Mr. Knowles' affidavit was transmitted to the Fund
by letter dated May 28, 1985 [FX 7], in which Company counsel asserted:
The Fund advances FX 7 as delineating the issues for arbitration, citing Fraser
abundantly clear that the Company put the meaning of "supply" at issue almost
two years in advance of the hearing.
supply [vt 2c(1)] as "to provide that which is required or desired by: satisfy the
(vt 1) as "to transfer or convey from one person or place to another: CARRY,
definition lists the other word as a synonym; see also Roget's II The New
the conclusion that they are not synonymous. Their difference may be illustrated
by elaboration upon an example provided by Mr. Frawley, the Fund spokesman,
A. I recall one that they were hauling heavy equipment, a company that
had tractor trailers and flat beds and they were hauling things like
bulldozers, cranes, various equipment of that type to and from job sites.
The company that hauled the bulldozers, cranes, etc. on its tractor trailers and
construction sites, whereas the organization which furnished the bulldozers, etc.
Lastly, the Fund makes a strong pitch that its interpretation of "supply"
error. See Dennard v Richards Group, Inc, 681 F2d 306, 318 (CA 5, 1982)
omitted). The Fund unreasonably failed to take into account the fact that
The only justification which the Fund can propose for the use of both
The Fund's proposal must be rejected for two reasons, (a) fundamental fairness
of the "building and construction industry" may benefit plans by attracting new
"principal function" test and by eliminating the "supply" category. After holding
itself out as having a broad definition, the Fund cannot after the fact contract its
of a broad definition, the Fund must accept the liabilities. Thus, fundamental
fairness to participating employers requires that the Fund be held to the plain
overlooked, this would not be one of them. The Central States Plan is one of the
Brief, p 3. The Fund is a multi-billion dollar entity [FX 5]. It is in the forefront
13
One of the main points made in Fraser Shipyards is that a plan sponsor (here, the Board of Trustees) has a duty
of good faith and fair dealing toward employers in withdrawal liability matters. 7 EBC 2575-2578.
pension reporter demonstrates, and has the benefit of excellent legal counsel;
indeed, in this matter alone, the Fund has had the benefit of the services of no
fewer than four able attorneys. To suggest that an organization of the Fund's
If a mistake really has been made, the Fund has ample authority and
expertise to correct it. More than five years have elapsed since adoption of the
"building and construction industry" definition and, to date, the Fund has taken
no corrective action. That fact alone seriously undermines the Fund's current
concludes:
Thus, the legislative history indicates Congress' intent that building and
construction industry be given the same meaning as has developed under
labor-management relations law, specifically the Taft-Hartley Act. Post-
Hearing Brief, p 30.
This conclusion is not supported by the statutory language and was rejected by
the Fund's Trustees when they adopted a definition manifestly broader than
14
"MPPAA" denotes the Multiemployer Pension Plan Amendments Act of 1980, PL 96-364, 94 Stat 1208, which
principally added the withdrawal liability provisions to ERISA.
15
Sen Comm on Labor and Human Resources, 96th Cong 2d Sess, S 1076 The Multiemployer Pension Plan
Amendments Act of 1980: Summary and Analysis of Consideration 14 (Comm Print 1980); HR Rep.869 Part I,
96th Cong. 2d Sess, 76 (1980), reprinted in US Code Cong & Ad News 2943-44.
those utilized in labor-management relations law.
intent." Bellmont Trucking, 788 F2d 433 (citation omitted). When Congress
ERISA Sec 4221(b)(3) [title 9, United States Code (US Arbitration Act)].
ERISA Sec 4203(b) contains no reference, either direct or indirect, to the Taft-
Hartley Act. In its Notice, PBGC clearly has rejected any notion that the
relations law. 47 FR 42590. Moreover, the Fund itself has rejected any such
notion.
Such an assertion ignores the plain language of the definition which the Trustees
supplied). The Fund, having adopted in 1982 a definition well outside the pale
In its reply brief, the Fund extensively discusses the case law interpreting
the construction industry within the meaning of Section 8(e) of the Taft-Hartley
Act.16 That issue is not before me. Rather, the issue presented is the meaning of
the building and construction industry as set forth in Plan, Appendix E, Sec
In its Post-Hearing Brief, the Fund explains the operation of the "primary
At first, Mr. Frawley testified that the Fund's definition had never been
16
Reply Brief of Central States, Southeast and Southwest Areas Pension Fund, pp 3-7.
However, on cross-examination by Company counsel, the following exchange
Q. Is it your testimony that you would only include within the meaning
of "substantially all" and within the meaning of section 7 of your rules,
work done at the job site or in the actual transportation?
A. No.
A. He might be.
Q. What is the difference between the tire man who makes sure the truck
can function and the oiler who makes sure the crane can function?
Mr. Frawley's disparate treatment of the oiler and tire man cannot be justified on
The Plan's definition is in two parts, the first pertaining to traditional on-
within the first part of the definition, then there is no basis for excluding him if
etc. That is, the oiler on a crane used to load construction material or equipment
onto trucks for transport to construction sites cannot be excluded if his on-site
counterpart is to be included. The language of the Plan document does not admit
work on-site. Cf. Tr 219. The Fund must accept the fact that the Plan's definition
performed off-site. The Trustees have adopted a definition through which they
It is the Fund, not the Company, which is attempting to over-extend the Plan's
definition.
The matter before me does not concern the Company's suppliers, but
rather the Company's own employees. The Company is not proposing food
simply does not present the issue of the permissible outer limits of a definition
within the parameters discussed in the PBGC Notice, 47 FR 42590, and well
VI. Refund
The Fund complains that the Company twice failed to respond to requests
for information pursuant to ERISA Sec 4219(a) [FX 2 & 3]. In turn, the
Company insists that it was not informed of the Withdrawal Liability Review
June 3, 1985 [FX 8]. We resolve these issues against the Company and in favor
of the Fund.
An employer shall, within 30 days after a written request from the plan
sponsor, furnish such information as the plan sponsor reasonably
18
Emphatically, this opinion does not say that every building and construction employer satisfies ERISA's
"substantially all" requirement; for a counterexample, see Tr 99-100 (two-thirds of employees deliver building
materials to construction sites; remainder deliver supplies to manufacturing plants).
determines to be necessary to enable the plan sponsor to comply with the
requirements of this part. (Emphasis supplied).
By letter dated November 8, 1984 [FX 2] and again by letter dated December 8,
1984 [FX 3], the Fund requested that the Company complete a detailed
[FX 17]. The Company did not bother to complete the questionnaire for two
years [FX 17], suggesting that it never received the requests. However, at the
hearing, the Fund produced certified receipts for both letters [FX 2, 3].
In its Preliminary Statement [FX 28], the Fund urges that "Oolite waived
or forfeited its right to contest the Fund's withdrawal liability assessment against
in order to maintain public confidence in and protect the integrity of the dispute
convinced that the Company's initial refusal to cooperate with the Fund put the
completely resolved the current dispute, issues might have become focused
more quickly and been narrowed in the interim.19
[Appendix E, Sec 6(b)(1)], provide that "[t]he Arbitrator may grant any remedy
or relief within the scope of ERISA." IFEBP/AAA Rules Sec 38. The Trustees
could have sued the Company under ERISA Sec 4301(a)(1) to force compliance
with ERISA Sec 4219(a). In such a case, a court could "award all or a portion of
the costs and expenses incurred in connection with such action, including
From an examination of the record, it appears that the Fund may have
incurred as much as five days of extra work because of the Company's failure to
allow the fund two days' attorney's fees at $125 per hour, for a total of $2,000.
19
It is interesting to note the many factors which the Company insists the Fund ought to have taken into account
in making its determination. Reply Brief of Oolite Industries, Inc., p 6. The point here is that if the Company had
furnished the information requested, the Fund would have been able to do so.
Although it is true that when the Company withdrew from the Plan and at
the time of the Fund's June 3, 1985 letter, Plan rules required that an employer
the Board of Trustees, these rules were changed by Board action in July of
1985, to eliminate the requirement of employer notification [FX 14]. The reason
for the change was that no employer had ever responded to such a notice [Tr
110]. It is too much to believe that the Company, which took two years to
galvanized into action and become the first employer in history to respond to a
harmless.
Under IFEBP/AAA Rules Sec 47, equal sharing of expenses is the norm,
and the record does not disclose any reason to deviate from the norm. Although
decision is for the Company, the Fund has acted in good faith. As was pointed
out above, the definition of "building and construction industry" has eluded
PBGC to date, and the Fund's own definition has been a constant source of
definition, and neither party has been able to cite any other building and
construction industry arbitration or case, and I know of none. The closest cases
The disposition of this matter moots the constitutional issues to which the
Company alluded in its Preliminary Statement [FX 27]. These issues were
Wholesale Employees Teamsters Union Local No. 115 Pension Plan v Yahn &
McDonnell, Inc, 787 F2d 128 (CA 3, 1986), the Third Circuit declared ERISA's
explained in C.A. Wright, Law of Federal Courts, 4th ed (West 1983), p 758 &
n 26:
In Neil v Biggers, 409 US 188, 191-192 (1972), cited in Wright, the Court
elaborated:
"If the judges are divided, the reversal cannot be had, for no order
can be made. The judgment of the court below, therefore, stands in
full force. It is, indeed, the settled practice in such case to enter a
judgment of affirmance; but this is only the most convenient mode
of expressing the fact that the cause is finally disposed of in
conformity with the action of the court below, and that that court
can proceed to enforce its judgment. The legal effect would be the
same if the appeal, or writ of error, were dismissed." Durant v.
Essex Co., 7 Wall. 107, 112 (1869).
Biggers was cited with approval in Trans World Airlines, Inc v Hardison, 432
US 63, 73 n 8 (1977).
From the foregoing, it is clear that the split over the constitutionality of
ERISA Sec 4221(a)(3) remains, with the First, Second, Fourth, Ninth and D.C.
Circuits upholding constitutionality, and with the Third Circuit voting against.
Rules Sec 37 are included (but not explicitly designated as such) in this opinion.
I thank the parties for their skilled presentations, especially for their
extensive briefs (3 by each side). If I have erred in any respect, it certainly is not
because the parties did not try to point me in the right direction.