The National Retirement Fund et al v. Metz Culinary Management, Inc
MEMORANDUM OPINION & ORDER re: 18 MOTION to Vacate Arbitration . filed by The National Retirement Fund, The Board of Trustees of the National Retirement Fund, 31 MOTION to Confirm Arbitration and Dismiss First Amended Com plaint. filed by Metz Culinary Management, Inc.: For the foregoing reasons, Plaintiffs motion to vacate the arbitration award is GRANTED, and Defendants motion to confirm the arbitration award is DENIED. The arbitration award is thus VACATED. The Court denies Metzs request to remand the case to arbitration because ERISA does not provide it with the authority to do so given that the Court has vacated an unambiguous award. See 29 U.S.C. § 1401(b); Hyle v. Doctors Assocs., Inc., 198 F.3 d 368, 370 (2d Cir. 1999) (holding that once arbitrators have finally decided the submitted issues, they are, in common-law parlance, functus officio, meaning that their authority over those questions is ended (citation omitted) and holding that a di strict court can remand an award to the arbitrator for clarification when an award is ambiguous). The Clerk of Court is respectfully directed to close docket entries 18 and 31 and to terminate the case. (Signed by Judge Valerie E. Caproni on 3/27/2017) (jwh)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
THE NATIONAL RETIREMENT FUND and
THE BOARD OF TRUSTEES OF THE
NATIONAL RETIREMENT FUND, each on
behalf of the Legacy Plan of the National
METZ CULINARY MANAGEMENT, INC.,
OPINION & ORDER
VALERIE CAPRONI, United States District Judge:
Plaintiffs, the National Retirement Fund and the Board of Trustees of the National
Retirement Fund (the “Trustees,” and together with the National Retirement Fund, the “Fund”),
each on behalf of the Legacy Plan of the National Retirement Fund (“the “Plan”), bring this
action against the Defendant, Metz Culinary Management, Inc. (“Metz”), pursuant to Sections
4221(b)(2) and 4301 of the Employee Retirement Income Security Act of 1974 (“ERISA”), as
amended, 29 U.S.C. §§ 1401(b)(2), 1451, to modify or vacate the arbitration award issued by
Arbitrator Ira F. Jaffe in Metz Culinary Management, Inc. and National Retirement Fund,
American Arbitration Association (“AAA”) Case No. 01-14-0002-2075 (the “Arbitration”) on
March 28, 2016 (the “Final Award”). Metz has cross moved to confirm the Final Award. For
the following reasons, the Fund’s motion to vacate the Final Award is GRANTED, and Metz’s
motion to confirm the Final Award is DENIED.
Statutory Background Regarding Withdrawal Liability
Among its several goals, ERISA “was designed to 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 the plans.” Connolly v. Pension
Benefit Guar. Corp., 475 U.S. 211, 214 (1986) (quotation marks and citation omitted). “One
type of pension plan regulated by ERISA is the multiemployer pension plan, in which multiple
employers pool contributions into a single fund that pays benefits to covered retirees who spent a
certain amount of time working for one or more of the contributing employers.” Trs. of Local
138 Pension Tr. Fund v. F.W. Honerkamp Co. Inc., 692 F.3d 127, 129 (2d Cir. 2012). Although
multiemployer plans have many benefits, such as allowing employers to share the costs and risks
inherent in the administration of pension plans, id.,
[a] key problem of ongoing multiemployer plans, especially in declining industries, is
the problem of employer withdrawal. Employer withdrawals reduce a plan’s
contribution base. This pushes the contribution rate for remaining employers to higher
and higher levels in order to fund past service liabilities, including liabilities generated
by employers no longer participating in the plan, so-called inherited liabilities. The
rising costs may encourage—or force—further withdrawals, thereby increasing the
inherited liabilities to be funded by an ever-decreasing contribution base. This vicious
downward spiral may continue until it is no longer reasonable or possible for the
pension plan to continue.
Id. (quoting Pension Benefit Guar. Corp. v. R.A. Gray & Co., 467 U.S. 717, 722 n. 2 (1984)).
In order to address this problem, Congress amended ERISA by enacting the
Multiemployer Pension Plan Amendments Act of 1980 (“the MPPAA), Pub. L. No. 96–364, 94
The Court cites to the parties’ briefs as the following: the Fund’s Memorandum of Law in Support of
Motion to Vacate Or Modify the Arbitration Award (Dkt. 19) is “Pls. Mem.;” Metz’s Memorandum of Law in
Opposition to Plaintiffs’ Motion to Vacate or Modify Arbitration Award And in Support of its Motion to Enforce
Arbitration Award (Dkt. 33) is “Def. Opp.;” the Fund’s Opposition to Defendant’s Motion for Judgment on the
Pleadings And Reply in Support of Plaintiffs’ Motion to Vacate or Modify Arbitration Award (Dkt. 36) is “Pls.
Reply;” and Metz’s Reply Memorandum of Law in Further Support of its Motion to Enforce Arbitration Award
(Dkt. 40) is “Def. Reply.”
Stat. 1208 (codified as amended in scattered sections of Titles 26 and 29 of the United States
Code). Id. Pursuant to the MPPAA, “[i]f an employer withdraws from a multiemployer plan . . .
the employer is liable to the plan in the amount determined under this part to be the withdrawal
liability.” 29 U.S.C. § 1381(a). “Withdrawal liability is the withdrawing employer’s
proportionate share of the pension plan’s unfunded vested benefits.” Trs. of Local 138 Pension
Tr. Fund v. F.W. Honerkamp Co. Inc., 692 F.3d at 130; see also 29 U.S.C. §§ 1381, 1391.
Unfunded vested benefits are “calculated as the difference between the present value of vested
benefits and the current value of the plan’s assets.” Pension Benefit Guar. Corp. v. R.A. Gray &
Co., 467 U.S. at 725 (citing 29 U.S.C. §§ 1381, 1391). In other words, unfunded vested benefits
reflect a plan’s underfunding in light of its commitment to pay benefits to plan participants in the
future. The calculation of an employer’s withdrawal liability thus requires the allocation of a
plan’s unfunded vested benefits among the plan’s contributing employers. Combs v. Classic
Coal Corp., 931 F.2d 96, 98 (D.C. Cir. 1991). Section 4211 of ERISA allows a plan to choose
one of four identified allocation methods or to develop its own method, subject to approval by
the Pension Benefit Guaranty Corporation (“PBGC”). 29 U.S.C. § 1391. Withdrawal liability is
required to be calculated “not as of the day of withdrawal, but as of the last day of the plan year
preceding the year during which the employer withdrew.” Milwaukee Brewery Workers’
Pension Plan v. Joseph Schlitz Brewing Co., 513 U.S. 414, 418 (1995) (citing 29 U.S.C.
§§ 1391(b)(2)(A)(ii), (b)(2)(E)(i), (c)(2)(C)(i), (c)(3)(A), and (c)(4)(A)). The “last day of the
plan year preceding the year during which the employer withdrew” will hereafter be referred to
as “the Measurement Date.”
In order to determine a withdrawing employer’s withdrawal liability, the plan’s actuary
must first calculate the plan’s unfunded vested benefits; to do so, the actuary must estimate the
present value of the plan’s vested benefits. Combs v. Classic Coal Corp., 931 F.2d at 98. The
actuary makes certain assumptions in order to estimate the present value of the plan’s vested
benefits, including the interest rate necessary to discount the liability for future benefit
payments. Id; Masters, Mates & Pilots Pension Plan v. USX Corp., 900 F.2d 727, 733 (4th Cir.
1990) (explaining that to “calculate the present value of the vested benefits that are to be paid out
in the future,” “[a]n interest rate, or rate of return, is applied in order to determine what present
amount of investment will yield the future amounts required to satisfy those vested benefits”); In
re HNRC Dissolution Co., 396 B.R. 461, 473 (B.A.P. 6th Cir. 2008) (“The calculation of the
‘present value’ of vested benefits also requires the plan’s actuary to discount the future stream of
benefit payments at an appropriate interest.”). Although there are many actuarial assumptions
necessary to calculate withdrawal liability, only the interest rate assumption is at issue in this
case. Relevant to this case, “[i]ncreasing the interest rate assumption decreases the employer’s
withdrawal liability”—and vice versa. Combs v. Classic Coal Corp., 931 F.2d at 98; see also
Masters, Mates & Pilots Pension Plan v. USX Corp., 900 F.2d at 733. ERISA does not dictate
the interest rate. Instead, ERISA Section 4213(a) requires withdrawal liability to be based on
“reasonable” actuarial assumptions and methods, “taking into account the experience of the plan
and reasonable expectations,” and to be “the actuary’s best estimate of anticipated experience
under the plan.” 29 U.S.C. § 1393(a).2
A. The Parties
The Fund is a Taft-Harley trust fund, established and maintained pursuant to Section
302(c)(5) of the Labor Management Relations Act, 29 U.S.C. § 186(c)(5), with trustees equally
Section 4213(a)(1) contemplated that PBGC may prescribe actuarial assumptions by regulation, but it has
not done so to date. Pls. Mem. 9 n.8.
divided between labor organizations currently and formerly affiliated with UNITED HERE and
Workers United and employers that contribute to the Fund. Am. Compl. ¶ 4 (Dkt. 8). The Plan
is a multiemployer plan within the meaning of Section 3(37) of ERISA, 29 U.S.C. § 1002(37).
Id. ¶ 6.3 Metz participated in the Fund as a contributing employer, meaning it made
contributions to the Fund to provide pensions to its employees in accordance with the governing
collective bargaining agreements. Answer to Am Compl. Ex. B (“Stip.”) ¶ 2 (Dkt. 16-1).4
B. The Fund’s Selection of an Interest Rate Assumption for Withdrawal
Liability for Plan Years 2013 and 2014
The Fund’s plan year begins on January 1 and ends on December 31 (the “Plan Year”).
Am. Compl. ¶ 12. Accordingly, under the Plan, the Measurement Date for withdrawal liability
for a given year is December 31 of the prior year. As of December 31, 2012, Buck Consultants
(“Buck”) was, and had been for years, the Fund’s actuary. Id. ¶¶ 14-15; Stip. ¶ 7. Buck’s
interest rate assumption for the 2013 Plan Year for calculating withdrawal liability was 7.25%.
Am. Compl. ¶ 15. Thus, the withdrawal liability for any employer that withdrew from the Plan
during 2013 would be calculated using a discount rate of 7.25%.
In October 2013, the Fund selected Horizon Actuarial Services LLC (“Horizon”) to
replace Buck as the Fund’s actuary. Id. ¶ 13. On June 5, 2014, Horizon informed the Fund’s
trustees that Horizon would use a PBGC rate as its interest rate assumption when it calculated
withdrawal liability for Plan participants that withdrew on or after January 1, 2014. Id. ¶ 18. On
As of January 1, 2013, the Plan had over 412,000 active, terminated, and retired participants. Sabatini
Decl. Ex. A, at 6 (ECF pagination) (Dkt. 20-1). Prior to January 1, 2015, the Plan was known as the Pension Plan of
the National Retirement Fund. Am. Compl. ¶ 7. The Fund, through its trustees, sponsors and administers the Plan.
Id. ¶ 5. The trustees are fiduciaries of the Fund and the Plan within the meaning of Section 3(21)(A) of ERISA, 29
U.S.C. § 1002(21)(A). Id. ¶ 9.
Metz is an employer within the meaning of Section 3(5) of ERISA, 29 U.S.C. § 1002(5); it is engaged in
commerce, and its activities affect commerce within the meaning of Sections 3(11)-(12) of ERISA, 29 U.S.C.
§§ 1002(11)-(12). Am. Compl. ¶ 11.
October 3, 2014, Horizon sent a memorandum to the Fund’s trustees explaining its decision to
select the PBGC’s interest rate assumption and the impact of the change on withdrawal liability.
Stip. ¶ 12; Litvin Decl. Ex. F (Dkt. 32-1). The PBGC rate selected by Horizon was 3% as
applied to the first twenty years of unfunded vested benefits and 3.31% thereafter. Am. Compl.
Ex. B (“Interim Award”), at 4 (Dkt. 8-2); Litvin Decl. Ex. F, at 1. Because the interest rate
assumption decreased from Plan Year 2013 to Plan Year 2014, withdrawal liability for
withdrawing employers increased from Plan Year 2013 to Plan Year 2014. It is undisputed that
the Fund was in dire financial circumstances in the time frame relevant to this case, leading it to
freeze the accrual of benefits as of December 31, 2013. Stip. ¶¶ 16-18. The Fund did not
provide any advance written notice in Plan Year 2014 to contributing employers regarding the
interest rate assumption change. Id. ¶ 19.
Although the Fund selected Horizon to replace Buck as its actuary in October 2013, Buck
continued to perform some work for the Fund related to Plan Year 2013. Specifically, in
November 2013, Buck completed and issued the Actuarial Valuation Report for the 2013 Plan
Year. Id. ¶¶ 7, 13; Litvin Decl. Ex. G (Dkt. 32-2). On November 6, 2014, Buck completed and
issued the Schedule MB for the Fund’s Form 5500 for Plan Year 2013. Stip. ¶ 7; Litvin Decl.
Ex. H (Dkt. 32-3).5
The Department of Labor, PBGC, and IRS require plan sponsors to submit Form 5500 to satisfy annual
reporting requirements under ERISA and the Internal Revenue Code. Form 5500 Corner, IRS,
https://www.irs.gov/retirement-plans/form-5500-corner (last visited March 23, 2017).
The Court may take judicial notice of this public information on the IRS’s website pursuant to Federal Rule
of Evidence 201. See Fernandez v. Zoni Language Centers, Inc., No. 15-CV-6066 (PKC), 2016 WL 2903274, at *3
(S.D.N.Y. May 18, 2016) (“Courts may also take judicial notice of information contained on websites where ‘the
authenticity of the site has not been questioned.’” (quoting Hotel Emps. & Rest. Emps. Union, Local 100 v. City of
N.Y. Dep’t of Parks & Recreation, 311 F.3d 534, 549 (2d Cir. 2002))); Wells Fargo Bank, N.A. v. Wrights Mill
Holdings, LLC, 127 F. Supp. 3d 156, 167 (S.D.N.Y. 2015) (taking judicial notice of information publicly available
on an internet database) (citing cases).
C. Metz’s Withdrawal from the Plan
Metz withdrew from the Fund on May 16, 2014. Am. Compl. ¶ 17. That withdrawal
triggered Metz’s obligation to pay withdrawal liability, which would be calculated as of
December 31, 2013. Def. Opp. 5. On June 16, 2014, the Fund sent Metz a notice and demand
letter for the payment of withdrawal liability. Am. Compl. ¶ 19. In that letter, the Fund assessed
Metz an estimated withdrawal liability of $954,821, payable in installments. Id. ¶ 20. On
December 26, 2014, the Fund issued a revised withdrawal liability assessment to Metz for
$997,734, payable in installments. Id. ¶ 21.
D. The Arbitration
On December 16, 2014, Metz filed a demand for arbitration against the Fund with the
AAA in order to challenge the Fund’s withdrawal liability assessment. Id. ¶ 22. The AAA
appointed Ira F. Jaffe, Esq. (the “Arbitrator”) to serve as arbitrator. Id. ¶ 23. The Fund and Metz
agreed that the Arbitrator would resolve a preliminary issue regarding the interest rate
assumption used by the Fund to calculate Metz’s withdrawal liability and that he would do so
based solely on written stipulations and briefing. Interim Award 1-2. Accordingly, the parties
did not conduct discovery except for limited document requests by Metz. Am. Compl. ¶ 24.
On February 22, 2016, the Arbitrator issued an Interim Award, holding that the Fund
improperly used the PBGC rate to calculate Metz’s withdrawal liability. Id. ¶ 25; Interim Award
20. According to the Arbitrator, because there was no evidence that Buck or Horizon took any
action on or before the Measurement Date to change the interest rate assumption, the 7.25%
interest rate assumption that indisputably had been in effect for Plan Year 2013 continued as the
interest rate assumption for Plan Year 2014. Interim Award 15-16, 19. The Arbitrator explicitly
rejected the Fund’s position that the Fund’s actuary had made no interest rate assumption as of
December 31, 2013. Id. at 16. In doing so, the Arbitrator concluded that “[a]bsent some change
by the Fund actuaries, the existing assumptions and method remained in place as of December
31, 2013.” Id.6 The Arbitrator then held that Horizon had improperly retroactively changed the
withdrawal liability interest rate assumption in violation of ERISA and PBGC opinion letters.
Id. at 11-16. The Arbitrator made clear that it would have been permissible for the actuary to
have calculated unfunded vested benefits after the Measurement Date, but the actuary could only
rely on assumptions and methods “that were actually adopted and in effect as of December 31,
2013.” Id. at 17. Because, according to the Arbitrator, the 7.25% withdrawal liability interest
rate assumption was in effect as of the Measurement Date, the actuary was required to use that
rate when calculating Metz’s withdrawal liability. Id. at 15-17, 19.
In his Interim Award, the Arbitrator directed the Fund to recalculate Metz’s withdrawal
liability “using the assumptions and methods that were in effect as of December 31, 2013.” Id.
19; Am. Compl. ¶ 26. On March 7, 2016, the Fund provided Metz an updated withdrawal
liability assessment using the 7.25% withdrawal liability interest rate assumption from Plan Year
2013. Am. Compl. ¶ 27. The revised withdrawal liability assessment was approximately
$250,000, see Answer to Am Compl., Ex. A, at 1 (Dkt. 16-1), and Metz did not object to the
revised assessment, Am. Compl. ¶ 28. On March 28, 2016, the Arbitrator issued his Final
Award, affirming the revised calculation and converting the Interim Award to a final award. Id.
¶¶ 29-30; id. Ex. A. On March 31, 2016, the Fund initiated this action in order to vacate or
modify the Final Award.
See also Interim Award 17 (“In the absence of some action by the Fund Actuary changing the interest rate
or other actuarial assumptions prior to the end of a Plan Year, the interest rate and assumptions that were in effect
during that Plan Year continued unchanged.”) (emphasis added).
The principal issue before this Court is whether the Arbitrator correctly decided that the
Fund violated ERISA by selecting the interest rate assumption for withdrawal liability for the
2014 Plan Year after the Measurement Date. The Arbitrator reached his conclusion by reframing
the issue. The Arbitrator did not ultimately conclude that the Fund violated ERISA because its
actuary selected a withdrawal liability interest rate assumption for the 2014 Plan Year after the
Measurement Date. Instead, the Arbitrator concluded that the Fund violated ERISA because its
actuary retroactively changed the interest rate assumption for the 2014 Plan Year after the
Measurement Date. The Arbitrator’s conclusion hinged on his determination that the existing
interest rate assumption for the 2013 Plan Year became the interest rate assumption for the 2014
Plan Year because the Fund’s actuary did not affirmatively change the interest rate assumption
by the Measurement Date.
The Court rejects the Arbitrator’s premise as inconsistent with ERISA—the withdrawal
liability interest rate assumption for the preceding plan year cannot become the interest rate
assumption for the following plan year by inertia. Nor does ERISA prohibit a plan’s actuary
from selecting the withdrawal liability interest rate assumption after the Measurement Date.
Accordingly, as explained more fully below, the Arbitrator’s Final Award is vacated.
The Court Reviews the Arbitration Award De Novo
The parties dispute whether a de novo standard of review or a rebuttable presumption of
correctness applies to resolve their cross motions to confirm and vacate the Final Award. In a
dispute regarding withdrawal liability under ERISA, courts review de novo the legal conclusions
of the arbitrator. 666 Drug, Inc. v. Tr. of 1199 SEIU Health Care Emps. Pension Fund, 571 F.
App’x 51, 52 (2d Cir. 2014) (per curiam); HOP Energy, L.L.C. v. Local 553 Pension Fund, 678
F.3d 158, 160 (2d Cir. 2012). As to the review of factual findings, ERISA, as amended by the
MPPAA, provides that “there shall be a presumption, rebuttable only by a clear preponderance of
the evidence, that the findings of fact made by the arbitrator were correct.” 29 U.S.C. § 1401(c).
The statutory framework does not expressly mandate a standard of review for mixed questions of
law and fact. Chicago Truck Drivers, Helpers & Warehouse Workers Union (Indep.) Pension
Fund v. Louis Zahn Drug Co., 890 F.2d 1405, 1410 (7th Cir. 1989). The Second Circuit has not
resolved the issue, but courts faced with the issue appear to adopt a clear error standard of
review. See 666 Drug, Inc. v. Tr. of 1199 SEIU Health Care Emps. Pension Fund, No. 12 CIV.
1251 (PAE), 2013 WL 4042614, at *5 (S.D.N.Y. Aug. 8, 2013) (collecting cases), aff’d, 571 F.
App’x 51 (2d Cir. 2014).
Metz argues that the Arbitrator’s determination that the withdrawal liability interest rate
assumption for Plan Year 2013 carried over as the interest rate assumption for Plan Year 2014
was a factual finding based on the parties’ joint stipulation of facts.7 Def. Opp. 11-15. The Fund
argues that the Arbitrator made a legal determination when it decided that the existing
assumptions continued from one plan year to the next absent a change by the actuary. Pls.
Mem. 8. The Court agrees with the Fund; the Arbitrator made a legal determination, not a
Whether the Fund’s actuary affirmatively adopted a withdrawal liability interest rate
assumption by the Measurement Date for the 2014 Plan Year is a factual question. The parties
do not dispute that factual issue—they (and the Arbitrator) agree that the actuary did not
affirmatively adopt a withdrawal liability interest rate assumption by December 31, 2013 for the
Metz argues in the alternative that whether the 2013 Plan Year withdrawal liability interest rate assumption
continued as the assumptive rate for the 2014 Plan Year is a mixed question of law and fact. Def. Opp. 13 n.8.
2014 Plan Year.8 Rather, they dispute whether, because the actuary did not affirmatively make
assumptions on or before the Measurement Date for the 2014 Plan Year, the assumptions that
were in place for the 2013 Plan Year became the actuarial assumptions for the 2014 Plan Year by
default. Resolving this dispute requires a legal determination under ERISA; the answer to this
question turns on the language of the statute. Specifically, whether withdrawal liability
assumptions automatically carry over year-to-year in the absence of an actuary’s affirmative
adoption of different assumptions depends on what ERISA requires of actuaries when they select
assumptions for withdrawal liability calculations for a given plan year.
The Arbitrator himself framed as a legal conclusion his determination that the 2013 Plan
Year interest rate assumption carried over to the 2014 Plan Year. He based his conclusion on an
interpretation of ERISA, as amended by the MPPAA. According to the Arbitrator, because the
“MPPAA requires that the assumptions and methods in effect on December 31, 2013, be used for
calculating the Employer’s withdrawal liability,” “[a]bsent some change by the Fund actuaries,
the existing assumptions and method remained in place as of December 31, 2013.” Interim
Award 16. Even Metz stated in its opening and reply briefs submitted to the Arbitrator that the
issue before the Arbitrator was purely legal. Sabatini Decl. Ex. B, at 2 (Dkt. 37-4) (“The issue
presented is a legal question of statutory interpretation. . . . [T]his preliminary issue does not
present any questions of fact or even mixed questions of fact and law . . . .”); id. Ex. C, at 1 (Dkt.
37-5) (“The legal issue presented is a dispositive legal issue in this arbitration proceeding.
. . . This briefing is in the nature of a motion for summary judgment, under Rule 56 of the
F.R.C.P., based on the material facts to which the parties have stipulated.”). Moreover, because
As discussed below in Section III, Metz appears to argue that certain documents suggest that Buck intended
the 7.25% interest rate assumption for the 2013 Plan Year to apply to the 2014 Plan Year, although Metz does not
go so far as to argue that Buck affirmatively adopted the 7.25% interest rate for the 2014 Plan Year.
the parties stipulated to all the facts before the Arbitrator, the Arbitrator’s conclusions were
exclusively legal.9 TCG N.Y., Inc. v. City of White Plains, 305 F.3d 67, 75 (2d Cir. 2002)
(“Because, as we have noted, the parties stipulated to all facts, the district court’s conclusions are
exclusively conclusions of law that are reviewed de novo.”); see also United Gen. Title Ins. Co.
v. Karanasos, No. 13-CV-7153 (JFB), 2014 WL 4388277, at *5 (E.D.N.Y. Sept. 5, 2014)
Accordingly, only legal conclusions are before the Court, and the Court reviews them de
Interest Rate Assumptions Do Not Automatically Carry over Year-to-Year
The Arbitrator incorrectly held that under ERISA, when an actuary fails affirmatively to
adopt assumptions for a given plan year to calculate withdrawal liability, the existing actuarial
assumptions from the preceding plan year remain in place by default. ERISA Section 4213
precludes this approach.
As explained above, Section 4213 requires that actuaries calculate withdrawal liability
based on “assumptions and methods which, in the aggregate, are reasonable (taking into account
the experience of the plan and reasonable expectations) and which, in combination, offer the
actuary’s best estimate of anticipated experience under the plan . . . .” 29 U.S.C. § 1393(a)(1).
Thus, to satisfy Section 4213, actuaries must take into account the full experience of the plan,
develop reasonable expectations, and ultimately provide their best estimate of unfunded vested
The parties filed some exhibits with the Arbitrator in support of their stipulated facts, but the Arbitrator did
not appear to rely on those exhibits in concluding that the 2013 Plan Year interest rate assumption continued by
default for the 2014 Plan Year. He neither cited nor referred to the exhibits in support of his conclusion (although
he did refer to them in the background portion of the Interim Award).
Even if the issue before the Court were a mixed question of law and fact, Metz would ultimately fare no
better under a clear error standard of review.
benefits in light of the plan’s experience and the actuary’s reasonable expectations. An actuary
can only do so by incorporating data from the entirety of the most recent preceding plan year. In
no universe is carrying over assumptions from a prior plan year without any examination or
analysis as to their continued viability and reasonableness an actuary’s “best estimate.” Yet the
Arbitrator concluded precisely that. An actuary may ultimately conclude that the prior plan
year’s assumptions continue to be reasonable in light of all of the available data, but she must
affirmatively reach that conclusion in order for the assumptions to qualify as such. As addressed
more fully below, there is no evidence here that any actuary analyzed and concluded that the
2013 Plan Year assumptions as applied to the 2014 Plan Year were reasonable or were the
actuary’s best estimate, nor did the Arbitrator indicate that he was relying on any such evidence
or making any such assumptions. A consequence of the Arbitrator’s holding would be that
actuarial assumptions would remain operative in perpetuity sans input from the actuary; this is
entirely at odds with Section 4213. Section 4213 does not allow stale assumptions from the
preceding plan year to roll over automatically —unlike wine, actuarial assumptions do not
improve with age.
The Arbitrator’s holding was also inconsistent with Section 4211 of ERISA. The
Arbitrator reasoned that the 2013 Plan Year assumptions rolled over by default for the 2014 Plan
Year because ERISA “requires that the assumptions and methods in effect on December 31,
2013, be used for calculating the Employer’s withdrawal liability.” Interim Award 16. But that
interpretation misconstrues ERISA Section 4211. ERISA does not provide that withdrawal
liability is to be calculated based on the assumptions and methods “in effect” on the
Measurement Date, as the Arbitrator maintains. ERISA instead provides that withdrawal
liability must be calculated based on the plan’s unfunded vested benefits “as of” the
Measurement Date. See Milwaukee Brewery Workers’ Pension Plan, 513 U.S. at 418 (citing
ERISA Section 4211, 29 U.S.C. §§ 1391(b)(2)(A)(ii), (b)(2)(E)(i), (c)(2)(C)(i), (c)(3)(A), and
“In effect” and “as of” are not the same. As the Fund explains, the 2013 Plan Year
withdrawal liability interest rate assumption was in effect, i.e., in force,11 on December 31, 2013,
for the purpose of calculating withdrawal liability for any employer who withdrew anytime
between January 1 and December 31, 2013. Pls. Mem. 9 n.7. The unfunded vested benefits
amount (and the interest rate assumption necessary to calculate that amount) that was in effect on
December 31, 2013, for withdrawals occurring during the 2013 Plan Year was, according to
ERISA, required to be calculated as of December 31, 2012, meaning it incorporated data up
through December 31, 2012. Similarly, ERISA requires the unfunded vested benefits amount
(and the interest rate assumption necessary to calculate that amount) for the 2014 Plan Year to be
calculated as of December 31, 2013, meaning it must incorporate data up through December 31,
2013. The unfunded vested benefits amount (and the interest rate assumption necessary to
calculate that amount) applicable to the 2014 Plan Year would then go in effect starting on
January 1, 2014. Accordingly, “in effect” is the in force date, while “as of” is the measurement
date. The Arbitrator incorrectly conflated the two. As explained above, the withdrawal liability
interest rate assumption in effect on the Measurement Date is not applicable to the upcoming
plan year unless the actuary affirmatively determines that the assumption, in combination with
her other assumptions, is reasonable and her best estimate of anticipated experience under the
plan as of the Measurement Date.12
Oxford English Dictionary, https://en.oxforddictionaries.com/definition/in_effect (last visited March 23,
The Arbitrator’s holding that withdrawal liability assumptions continue to apply year after year until
affirmatively changed by the actuary is also inconsistent with the professional standards governing actuaries.
Because ERISA Section 4213 provides for a reasonableness standard, “it would make sense to judge the
reasonableness of a method [or assumption]” and the timing of those decisions—“by reference to what the actuarial
There Is No Evidence that the Actuary Intended the 2013 Plan Year Withdrawal
Liability Interest Rate Assumption to Apply to the 2014 Plan Year
Regardless of whether the Arbitrator’s legal conclusion was correct that the 2013 Plan
Year assumptions carried over by default to the 2014 Plan Year, Metz argues that the factual
record supports a finding that the Fund (or at least its actuaries) initially intended the withdrawal
liability interest rate assumption for the 2013 Plan Year to continue as an assumption for the
2014 Plan Year—an argument that Metz did not make during arbitration. See Def. Opp. 15-16;
Def. Reply 4-5.13 Metz points to: (1) a particular stipulation of fact, (2) Buck’s Actuarial Report
for the 2013 Plan Year, (3) the October 3, 2014, memorandum from Horizon to the Fund’s
trustees, and (4) the Schedule MB for the Fund’s Form 5500 for the 2013 Plan Year. The record
does not support Metz’s argument.
Metz contends that the Fund effectively conceded that the 2013 Plan Year assumptions
remained operative rate for the 2014 Plan Year because the parties stipulated that the 2013 Plan
Year interest rate assumption was still “in use” on December 31, 2013. Def. Opp. 15; Def.
Reply 3 n.1. That was not, however, the fact to which the parties stipulated. The parties
stipulated that “Buck Consultants had used a 7.25 percent interest rate in 2013 to calculate
profession considers to be within the scope of professional acceptability in making an unfunded liability
calculation.” Concrete Pipe & Prod. of Cal., Inc. v. Constr. Laborers Pension Tr. for S. Cal., 508 U.S. 602, 635
(1993). Actuarial Standard of Practice 27 (“ASOP 27”) provides, in relevant part, that “[t]he economic assumptions
selected to measure pension obligations should reflect the actuary’s knowledge base as of the measurement date.”
Actuarial Standards Board, Doc. No. 145, Actuarial Assumptions for Measuring Pension Obligations § 3.14.3
(Sept. 2007 rev. ed., Updated for Deviation Language Effective May 1, 2011), available at
http://www.actuarialstandardsboard.org/wp-content/uploads/2014/10/asop027_145.pdf (last visited March 12,
2017). (There is a more recent version of ASOP 27, but the version cited applies to Metz’s withdrawal as it is
“effective for any actuarial valuation with a measurement date on or after March 15, 2008.” ASOP 27 § 1.4). It
seems clear, then, that as a matter of professional standards, an actuary must consider data relevant to the
experiences of the plan up through the Measurement Date in making her assumptions. The Court, however, makes
no determination regarding whether, if an actuary has not yet selected her assumptions, she may in certain
circumstances take into account events occurring after the Measurement Date in formulating her assumptions.
Metz also advanced this argument during oral argument in this case. See Tr. 13:21-16:3, 24:25-26:4, 35:
21-37:11, 44:18-45:1, 45:17-20 (Dkt. 44).
unfunded vested benefit liabilities and withdrawal liability,” Stip. ¶ 8, which says nothing about
what the actuary intended with respect to assumptions applicable to 2014 withdrawals.
Metz argues that Buck’s Actuarial Report for the 2013 Plan Year, issued in November
2013, shows that Buck signaled that it viewed the 7.25% rate as appropriate throughout 2013;
specifically, Metz points to a table in the report that lists the withdrawal liability interest rate as
7.25% for January 1, 2012 and January 1, 2013. Def. Opp. 16; Def. Reply 4-5 (citing Litvin
Decl. Ex. G, at 1514). Again, this evidence in no way indicates that Buck decided that the 7.25%
rate would apply to 2014 (a period for which it was no longer the Fund’s actuary). Moreover,
Buck’s letter to the Fund’s trustees transmitting the Report states unequivocally that “[t]he
unfunded vested benefits reported for withdrawal liability purposes are measured as of December
31, 2012,” Litvin Decl. Ex. G, at 1, and numerous portions of the Report are consistent with that
statement, see id. at 6, 7, 11, 23.
Metz also claims that because Horizon stated in its October 3, 2014 memorandum that it
had decided “to change” the withdrawal liability interest assumption, Horizon understood that it
was changing—i.e., revising—the 2014 Plan Year interest rate assumption as opposed to
establishing it for the first time. Def. Mem. 16. Apart from the word “change,” there is nothing
in the memorandum to suggest that Horizon believed it was changing interest rate assumptions
that were already in place for 2014. See generally Litvin Decl. Ex. F. A more logical reading of
the memorandum is that Horizon is explaining that it is adopting a withdrawal liability interest
rate assumption for 2014 that is different from the rate that Buck had used in previous years.
Indeed, Horizon acknowledges in the memorandum that the Fund has “historically” used a
When citing to Exhibit G of the Litvin Declaration, the Court cites to the ECF pagination because the
Exhibit includes more than one document, each with its own pagination.
7.25% interest rate assumption, id. at 2, and thus seems to indicate that it is breaking with that
historic practice for 2014.
Finally, somehow, according to Metz, because Buck signed the Schedule MB for the
Form 5500 for the 2013 Plan Year in November 2014, and because the Schedule MB provides
that 7.25% is the interest rate assumption for withdrawal liability, Buck must have believed that
the 7.25% rate applied to the 2014 Plan Year. Def. Opp. 15; Def. Reply 4-5. Once again, there
is nothing in the Schedule MB that indicates the information therein applies to 2014, even if the
Form 5500 was filed in 2014. In contrast, the Form 5500 and Schedule MB are labeled “2013”
at the top, and the heading states “for calendar plan year 2013.” Litvin Decl. Ex. H, at 4.15 It
ultimately makes no sense to claim that the Schedule MB proves that, in November 2014, when
Buck executed the Schedule MB, 7.25% was the interest rate assumption for the 2014 Plan Year
because, by that time, Metz had already withdrawn from the Fund, and the Fund had already
demanded that Metz pay withdrawal liability calculated in accordance with the lower PBGC
interest rate assumption that Horizon had adopted.
In sum, based on ERISA, the Court rejects the Arbitrator’s presumption that, absent an
affirmative change by the Fund’s actuaries, the 2013 Plan Year withdrawal liability interest rate
assumption carried over to become the 2014 Plan Year assumption. The Court also rejects
Metz’s factual argument that the Fund had, in fact, adopted 7.25% as the interest rate assumption
for the 2014 Plan Year. The remaining issue, therefore, is whether ERISA allows an actuary to
select an interest rate assumption after the Measurement Date.
For clarity, when citing to Exhibit H of the Litvin Declaration, the Court cites to the ECF pagination.
ERISA Does Not Require Actuaries to Make Withdrawal Liability Assumptions
by the Measurement Date
A. ERISA Section 4213 Does Not Require Actuaries to Select Assumptions by
the Measurement Date
Nothing in ERISA Section 4213, which requires that the assumptions in the aggregate
represent the actuary’s best estimate of anticipated experience under the plan, requires an actuary
to select her assumptions by the Measurement Date. See 29 U.S.C. 1393(a)(1). ERISA Section
4213 is silent regarding the timing of an actuary’s selection of her assumptions. As explained
above, the requirement in ERISA Section 4211 that the actuary calculate unfunded vested
benefits “as of the end of the last plan year” does not require the actuary to make her
assumptions by the Measurement Date but only requires unfunded vested benefits to be
measured as of that date. Indeed, Metz does not argue that Section 4213 itself requires actuaries
to make their assumptions by the Measurement Date; Metz acknowledges that the statute is silent
on the issue.
Considering just one hypothetical scenario illustrates the potential significant pitfalls of
the Arbitrator’s view of the law. If actuaries were required to select their withdrawal liability
assumptions by the Measurement Date, in some instances at least, they would be unable to fulfill
Section 4213’s best estimate requirement. In order for an actuary to make her assumptions, she
must first analyze data regarding the economy and financial markets, the fund’s investments, and
the plan’s participants, among other things. To finalize her assumptions by the Measurement
Date, she must do all of that analysis before she has a full year of data. If an economic or
financial event took place between Christmas and New Year’s Eve that would significantly
affect the fund’s future performance and its ability to meet its future liabilities, the actuary would
not be able to take that data into account in formulating its assumptions because there would not
be time to do so before the Measurement Date. If that were the case, the actuary’s assumptions
in the aggregate might be neither reasonable nor the actuary’s best estimate of anticipated
experience under the plan as of the Measurement Date, as required by Sections 4213 and 4211.
Moreover, it seems logical that even in a normal year (without any end-of-year financial
surprises), the information necessary to make thoughtful withdrawal liability assumptions may
not be entirely available before the end of the plan year, and an actuary needs time to collect,
review, and synthesize that information after it is all available. It is thus easy—and reasonable—
to imagine that an actuary may not be ready to state her assumptions by the Measurement Date.
If the Arbitrator’s rule were correct, this would be problematic for actuaries. On the one hand,
ERISA Sections 4213 and 4211 would require them to make assumptions measured as of the last
day of the preceding plan year that are reasonable and their best estimate. On the other hand, the
Arbitrator’s rule would require them to adopt assumptions by the Measurement Date. An
actuary would unlikely be able to satisfy both requirements as it would be difficult for an actuary
to make her best estimate without knowing all the relevant data as of the Measurement Date. In
short, the Arbitrator’s rule is inconsistent with the actuary’s obligations under ERISA Section
Metz suggests that allowing actuaries to select their assumptions at any point during the
plan year—instead of by the Measurement Date—invites abuse by funds and their actuaries.
According to Metz, the Arbitrator was rightfully concerned about bias because allowing
actuaries to select assumptions after the Measurement Date creates the opportunity for a plan’s
trustees to wait and see if there will be a significant number of withdrawing employers and, if so,
then hire a new actuary who is willing to impose a more draconian interest rate assumption on
withdrawing employers. Def. Opp. 23-25; Tr. 56:17-57:6, 57:17-22.
But the posited bias problem is not a function of the date on which the actuary sets the
rate. See Tr. 57:7-16, 57:23-58:1. A fund’s trustees, knowing that the fund is in a difficult
financial situation, may at any time remove one actuary in favor of another actuary who appears
to be more malleable. Indeed, in this case, Horizon was hired in the fall of 2013 and could have
adopted the PBGC rate before the Measurement Date. If Horizon had done so, Metz would not
be able to argue, as it does now, that the rate does not apply to it because the rate would have
been adopted before December 31. Yet, Metz’s concern about bias would remain. Under
ERISA, a withdrawing employer’s protection is (1) the professionalism of the actuary, see
Concrete Pipe & Prod. of California, Inc., 508 U.S. at 632 (1993) (“For a variety of reasons, this
actuary is not, like the trustees, vulnerable to suggestions of bias or its appearance. Although
plan sponsors employ them, actuaries are trained professionals subject to regulatory standards.”),
and (2) the actuary’s statutory obligation to set the withdrawal liability based on reasonable
assumptions that reflect the actuary’s best estimate. An actuary who is simply bowing to
pressure from a fund is violating her ERISA mandate, regardless of the date on which her
interest rate assumptions are finalized.16 Providing additional protections to employers, if
warranted, is best left to Congress.
B. ERISA Section 4214 Only Applies to Plan Rules and Amendments, Not
Finally, Metz argues that Section 4214, which prohibits the retroactive application of plan
rules or amendments to withdrawing employers, also applies to interest rate assumptions. See
Def. Opp. 17-20. ERISA Section 4214 provides in full:
(a) No plan rule or amendment adopted after January 31, 1981, under [ERISA Sections
4209 and 4211(c)] of this title may be applied without the employer’s consent with
respect to liability for a withdrawal or partial withdrawal which occurred before the
date on which the rule or amendment was adopted.
Whether Horizon’s selection of the PBGC rate, in combination with its other assumptions, was reasonable
and its best estimate is not before this Court. If Metz chooses to arbitrate the issue, a factual record can be
developed that fleshes out Horizon’s thought processes. If Metz has evidence to support its suggestion that Horizon
bowed to pressure from the Fund, the Court is confident an arbitrator will be able to evaluate that evidence
(b) All plan rules and amendments authorized under this part shall operate and be
applied uniformly with respect to each employer, except that special provisions may
be made to take into account the creditworthiness of an employer. The plan sponsor
shall give notice to all employers who have an obligation to contribute under the plan
and to all employee organizations representing employees covered under the plan of
any plan rules or amendments adopted pursuant to this section.
29 U.S.C. § 1394. Metz claims that because Section 4214(a) references Section 4211(c),17 which
addresses “Amendment of multiemployer plan for determination respecting amount of unfunded
vested benefits allocable to employer withdrawn from plan; factors determining computation of
amount,” 29 U.S.C. § 1391(c), and because the interest rate assumption is a critical factor in the
withdrawal liability calculations, withdrawal liability assumptions “logically fit” as a plan rule or
amendment under Section 4214. Def. Opp. 17-18. In addition, Metz contends that Section
4214(b) applies to interest rate assumptions because it incorporates Section 4213 when it states
that it applies to “[a]ll plan rules and amendment authorized under this part.” Id. at 19. Metz
points to Section 4214’s legislative history18 as support, claiming that Congress intended it to be
expansive and to bar the retroactive application not only of plan rules relating to withdrawal
liability but also interest rate assumptions, which are “naturally include[d]” therein. Id. at 18.
None of Metz’s arguments is persuasive. Although Section 4214 may reference other
ERISA provisions relating to the calculation of withdrawal liability, nowhere in Section 4214 or
Metz admits that Section 4209 is irrelevant because it addresses the role of the “de minimis” rule in
calculating withdrawal liability, which does not apply here.
Metz specifically quotes the following:
There are several situations where plans, in the application of their own rules, either initially or by
amendment, are permitted a wide degree of latitude in allocating and calculating withdrawal liability. In
order to protect an employer from certain retroactive changes in a plan’s rules, the bill prohibits the
retroactive application of a plan rule or amendment relating to withdrawal liability from applying to a
withdrawal occurring before its date of adoption, unless the employer consents to its earlier application.
H.R. Rep. No. 96-869, pt. 2, at 30 (1980).
the legislative history does it suggest that Section 4214 applies to actuarial assumptions. The
statute and the legislative history exclusively use the terms “plan rule” or “amendment,” and
there is no language suggesting that those terms should be interpreted broadly to include
actuarial assumptions. The statute does not define “rule” or “amendment,” but the Court finds
the Fund’s explanation that a rule or amendment is something voted on by the trustees, see Tr.
53:11-19, is logical. Metz acknowledged in its opening brief to the Arbitrator that Horizon’s
adoption of the PBGC rate was not a per se plan rule or amendment, Sabatini Decl. Ex. B, at 10,
and the parties do not dispute that the trustees did not vote to adopt Horizon’s assumptions.
Metz argues that plan rules need not be exclusively plan document provisions, and
because a fund’s trustees are not wholly removed from the process of selecting actuarial
assumptions—namely, they have a fiduciary duty to ensure that actuarial assumptions are
sound—the selection of an actuarial assumption is as much a “plan rule” as any other trustee
action. Def. Reply. 6; Tr. 46:17-47:16. This approach, however, would effectively turn any
trustee action into a plan rule or amendment. Metz advocates that even if the selection of the
interest rate assumption is not actually a plan rule or amendment, Section 4214 should apply
because Congress was concerned generally “about changes that take place after a withdrawal that
could impact a[n] employer’s withdrawal liability.” Tr. 51: 6-11. But, there is nothing in the
legislative history to suggest that Section 4214 should be generalized in this way. Congress’s
concern, as reflected in the statute’s and the legislative history’s exclusive reference to plan rules
and amendments, was about retroactive plan rules and amendments having an impact on
withdrawal liability. Accordingly, the Court is not persuaded that Section 4214’s prohibition on
retroactive application of plan rules or amendments has any applicability to this dispute.19
The Court’s analysis would be different if a plan rule or amendment provided for a specific interest rate
assumption to be used. Because the trustees would have voted on that assumption as part of the plan, Section 4214
Moreover, the distinction between Section 4214—which explicitly prohibits the
retroactive application of plan rules or amendments—and Section 4213—which is silent as to the
timing of the actuary’s selection of withdrawal liability assumptions—further emphasizes that
Section 4213 does not prohibit the retroactive application of actuarial assumptions within a given
plan year, so long as they are made as of the appropriate Measurement Date. If Congress had
wanted to preclude the retroactive application of assumptions within a given plan year, it could
have done so explicitly, as it did in Section 4214 for plan rules and amendments.
C. ERISA Section 101(1) Is Consistent with the Interpretation that ERISA Does
Not Require Actuaries to Select Assumptions by the Measurement Date
The Court is sympathetic to employers’ concern, as described above, that if an actuary
can select her assumptions at any point during a plan year and apply them retroactively to
withdrawing employers, those employers may be unpleasantly surprised that their withdrawal
liability is significantly more than expected. But ERISA Section 101(l) shows that this is already
the case. ERISA Section 101(1) governs employer requests for withdrawal liability estimates in
a multiemployer pension plan. The withdrawal liability estimate is measured as “if such
employer withdrew on the last day of the plan year preceding the date of the request.” 29 U.S.C.
§ 1021(l)(1)(A). Thus, under the Plan at issue here, on June 1, 2014, an employer’s estimate of
withdrawal liability would be calculated as if the employer withdrew on December 31, 2013,
which, under ERISA Section 4211, would be calculated as of December 31, 2012—the last day
of the plan year preceding the plan year in which the hypothetical withdrawal occurred.
Adopting the Arbitrator’s rule that actuaries must choose assumptions by the Measurement Date
would not improve employers’ ability to gauge their expectations regarding withdrawal liability
would presumably apply. See, e.g., Allen v. W. Point-Pepperell, Inc., 908 F. Supp. 1209, 1213, 1222-23 (S.D.N.Y.
1995) (although Section 4214 did not apply because it was a single-employer plan, the terms of this plan dictated a
specific numeric interest rate assumption).
assessments; the estimates provided to them will always be lagging as they are statutorily
required to be based on a prior year.
ERISA Section 101(l) also suggests that Congress understood that the assumptions
necessary to calculate withdrawal liability may not be ready by the first day of the plan year, in
contrast with the Arbitrator’s holding. If the Arbitrator were correct that ERISA required
actuaries to select their assumptions by the Measurement Date, there would have been no need
for Congress to direct that withdrawal liability estimates be calculated as if the withdrawal
occurred in the previous plan year. Likewise, Section 101(l) would not have needed to provide a
180-day window for a plan to give an estimate of withdrawal liability to an employer. See 29
U.S.C. § 102(l)(2)(A).
Accordingly, Section 101(l) only makes sense if there is no requirement that actuaries
select all of their assumptions by the Measurement Date. 20
For the foregoing reasons, Plaintiffs’ motion to vacate the arbitration award is
GRANTED, and Defendant’s motion to confirm the arbitration award is DENIED. The
Metz and the Arbitrator point to PBGC Opinion Letters Nos. 90-2 (Apr. 20, 1990) and 94-5 (Sept. 27,
1994) and Roofers Local No. 30 Combined Pension Fund v. D.A. Nolt, Inc., 719 F. Supp. 2d 530 (E.D. Pa. 2010),
aff’d, 444 F. App’x 571 (3d Cir. 2011), for the proposition that an actuary cannot retroactively change a withdrawal
liability interest rate assumption after it has been selected. Def. Opp. 14; Interim Award 12-14. Metz and the
Arbitrator are correct, but that proposition is not instructive here.
Those sources go no further than to provide that withdrawal liability calculations made in a prior plan year
may not be retroactively revised in light of an error discovered after withdrawal liability has been calculated for a
withdrawing employer. See Roofers Local No. 30 Combined Pension Fund, 719 F. Supp. 2d at 546-51 (confirming
arbitration award and holding that a fund’s attempt to retroactively increase unfunded vested benefits for prior plan
years due to a later discovered mathematical error was not permitted under ERISA); PBGC Opinion Letter No. 90-2
(“If the trustees discover an error in the calculation of the plan’s unfunded vested benefits for a prior plan year, the
valuation for that prior year may not be changed retroactively.”); PBGC Opinion Letter No. 94-5 (“In Opinion Letter
90-2, we were referring to errors relating to mistaken or varying data or actuarial assmptions, rather than errors that
are purely mathematical or computational in nature.”). But, that is not the scenario before this Court. At issue here
is whether an actuary must choose her withdrawal liability assumptions by the Measurement Date or whether she
may choose them after the Measurement Date. The sources cited by Metz and the Arbitrator do not touch on this
arbitration award is thus VACATED. The Court denies Metz’s request to remand the case to
arbitration because ERISA does not provide it with the authority to do so given that the Court
has vacated an unambiguous award. See 29 U.S.C. § 1401(b); Hyle v. Doctor’s Assocs., Inc.,
198 F.3d 368, 370 (2d Cir. 1999) (holding that “once arbitrators have finally decided the
submitted issues, they are, in common-law parlance, ‘functus officio,’ meaning that their
authority over those questions is ended” (citation omitted) and holding that a “district court can
remand an award to the arbitrator for clarification when an award is ambiguous”).
The Clerk of Court is respectfully directed to close docket entries 18 and 31 and to
terminate the case.
United States District Judge
Date: March 27, 2017
New York, New York
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