Multiemployer Trustee: Fiduciary Duties

[ERISA25]

There is a supreme court case that specifically says a multiemployer plan trustee must act solely in the interest of plan participants when wearing his fiduciary hat. See Amax, 453 U.S. 950. I am looking for cases in which a fund or participant has brought a fiduciary-breach case against either a labor or employer appointed trustee, where the plaintiff is alleging that the trustee has acted in the interest of the appointing party rather in the interest of the beneficiaries. Any law review articles or cases on point?

[Bill Ecklund]

There is a supreme court case that specifically says a multiemployer plan trustee must act solely in the interest of plan participants when wearing his fiduciary hat. See Amax, 453 U.S. 950. I am looking for cases in which a fund or participant has brought a fiduciary-breach case against either a labor or employer appointed trustee, where the plaintiff is alleging that the trustee has acted in the interest of the appointing party rather in the interest of the beneficiaries. Any law review articles or cases on point?

There are so many out there. Start with this one: Deak v. Masters, Mates & Pilots Pension Plan, 821 F.2d 572 (11th Cir. 1987), cert. denied, 108 S.Ct. 698, 9 EBC 1306. Also: 04/26/1990, U.S. District Court, Colorado, Joint Apprenticeship and Training Committee of Sheet Metal Workers' Intern. Ass'n, Local No. 9 v. Flansburg, 744 F Supp 1008, 119 CCH LC ¶10758, 1990 WL 120015

[ERISA25]

There is a supreme court case that specifically says a multiemployer plan trustee must act solely in the interest of plan participants when wearing his fiduciary hat. See Amax, 453 U.S. 950. I am looking for cases in which a fund or participant has brought a fiduciary-breach case against either a labor or employer appointed trustee, where the plaintiff is alleging that the trustee has acted in the interest of the appointing party rather in the interest of the beneficiaries. Any law review articles or cases on point?

There are so many out there. Start with this one: Deak v. Masters, Mates & Pilots Pension Plan, 821 F.2d 572 (11th Cir. 1987), cert. denied, 108 S.Ct. 698, 9 EBC 1306. Also: 04/26/1990, U.S. District Court, Colorado, Joint Apprenticeship and Training Committee of Sheet Metal Workers' Intern. Ass'n, Local No. 9 v. Flansburg, 744 F Supp 1008, 119 CCH LC ¶10758, 1990 WL 120015

Thanks, Bill. Deak is very helpful.

It seems to me that a trustee is acting in a fiduciary capacity when it determines the date that a withdrawing employer completely withdrew from a fund. It seems that it would be a fiduciary breach if a trustee based that decision on loyalty to the appointing party (i.e. picking a date b/c it results in less withdrawal liability for the withdrawing er). Have you seen any cases with this type of fact pattern?

[Bill Ecklund]

There is a supreme court case that specifically says a multiemployer plan trustee must act solely in the interest of plan participants when wearing his fiduciary hat. See Amax, 453 U.S. 950. I am looking for cases in which a fund or participant has brought a fiduciary-breach case against either a labor or employer appointed trustee, where the plaintiff is alleging that the trustee has acted in the interest of the appointing party rather in the interest of the beneficiaries. Any law review articles or cases on point?

There are so many out there. Start with this one: Deak v. Masters, Mates & Pilots Pension Plan, 821 F.2d 572 (11th Cir. 1987), cert. denied, 108 S.Ct. 698, 9 EBC 1306. Also: 04/26/1990, U.S. District Court, Colorado, Joint Apprenticeship and Training Committee of Sheet Metal Workers' Intern. Ass'n, Local No. 9 v. Flansburg, 744 F Supp 1008, 119 CCH LC ¶10758, 1990 WL 120015

Thanks, Bill. Deak is very helpful.

It seems to me that a trustee is acting in a fiduciary capacity when it determines the date that a withdrawing employer completely withdrew from a fund. It seems that it would be a fiduciary breach if a trustee based that decision on loyalty to the appointing party (i.e. picking a date b/c it results in less withdrawal liability for the withdrawing er). Have you seen any cases with this type of fact pattern?

The date on which an employer has withdrawn from a multiemployer plan is pretty much determined by the statute. There may be fact situations in which it is unclear as to what the correct date is, and there are cases that have addressed that issue. If there is some ambiguity as to what the withdrawal date is, the fact that the trustees select one date over another, even if it would favor an appointing party, may not be a breach of fiduciary duty. However, where it is clear as to what the withdrawal date is, and the trustees select a different date because it does favor one of the appointing parties, that would be a breach of fiduciary duty. Specifically, the breach would be failure to follow the plan documents and the law, i.e. a violation of ERISA §404(a)(1)(1)(D). I am not aware of a case that addresses the issue of fiduciary duties in selecting the withdrawal date for purposes of assessing withdrawal liability. That does not mean that there are not any out there, I am just unaware of any.