The National Retirement Fund v. Domestic Linen Control Group
- Subramanian
- 1:23-cv-05955
- U.S. District Court · Southern District of New York
- 2
In National Retirement Fund v. Domestic Linen, Judge Subramanian ordered explanations of the defendant’s withdrawal-liability calculation and related interest-rate issues.
The National Retirement Fund and the other plaintiffs, Domestic Linen Control Group, and the parties’ dispute over withdrawal liability.
What happened
The National Retirement Fund v. Domestic Linen Control Group concerns an arbitration award involving the calculation of Domestic Linen Control Group’s withdrawal liability. The order did not decide whether the award should be affirmed.
The court directed both sides to submit letters explaining the calculation, its assumptions and inputs, and any report sent to Domestic Linen Control Group. The letters must also address the interest rates used, minimum-funding requirements, the arbitrator’s two stated grounds, and whether the rate reflected the Fund’s past or projected investment returns.
Judge Arun Subramanian ordered the parties to submit letters of no more than seven single-spaced pages by June 7, 2024, at 5:00 p.m. The order requested further information and did not resolve the underlying dispute.
The detailed version
- The National Retirement Fund v. Domestic Linen Control Group · No. 1:23-cv-05955
- Subramanian
- May 31, 2024
What the order concerns
The National Retirement Fund and other plaintiffs are litigating a dispute involving Domestic Linen Control Group’s withdrawal liability. The opinion refers to an arbitration award and to arguments about the interest rate used to calculate withdrawal liability and the interest rate used to calculate minimum funding.
Information requested by the court
The court directed the parties to submit letters by Friday, June 7, 2024, at 5:00 p.m. Each letter may be no more than seven single-spaced pages. The parties must:
- explain in detail the entire calculation of Domestic Linen Control Group’s withdrawal liability, including every assumption and input, without using jargon; - submit any report describing the calculation that was sent to Domestic Linen Control Group; - explain Plaintiffs’ argument that withdrawal-liability installment payments do not remain invested for the long term and therefore may support an interest rate between 7.3% and 0%; - explain why the interest rate should be adjusted if the calculation already accounts for some plan assets being used each year to pay liabilities; - explain the statutory requirements for calculating minimum funding, including the effect of 29 U.S.C. § 1084(c)(6)(E)(ii)(1) on the argument that the rates for minimum funding and withdrawal liability should be the same or similar; - address whether the court must affirm the arbitration award if it agrees with either of the arbitrator’s two grounds; and - explain whether there is a difference between requiring an interest rate to reflect the Fund’s past investment returns and requiring it to reflect projected investment returns, including whether the 7.3% rate was based on past or projected returns.
Effect of the order
Judge Arun Subramanian issued an information-gathering order. The opinion does not state whether the court affirmed, vacated, or otherwise ruled on the arbitration award, and it does not resolve the parties’ dispute about the proper interest rate.
Read the full 2-page opinion on CourtListener, the free public archive maintained by the Free Law Project.