Trustees Of The New York City District Council Of Carpenters Pension Fund v…

Background

The plaintiffs are employer and employee trustees of the New York City District Council of Carpenters Pension Fund, a multiemployer pension plan governed by the Employee Retirement Income Security Act (ERISA). Mensch Millwork Corp. entered into a collective bargaining agreement with the New York City District Council of Carpenters that required hourly contributions to the Fund for covered work.

The Fund determined that Mensch Millwork completely withdrew from the plan on June 30, 2019, after the company’s contributions declined because it stopped performing covered work under the agreement. The Fund assessed withdrawal liability of $241,026, payable in 13 quarterly installments of $19,393.75 followed by a final payment of $10,620.18. The first installment was due May 1, 2023, but Mensch Millwork did not pay it. After the Fund sent a missed-payment notice on July 27, 2023, Mensch Millwork still did not cure the missed payment within 60 days. By February 18, 2025, it had failed to make eight quarterly payments totaling $154,950.

Motion and arguments

The Trustees moved to compel interim withdrawal-liability payments while the underlying action was pending. They argued that they had followed the statutory process: determining that Mensch Millwork had withdrawn, calculating the liability, notifying the company of the amount and schedule, and demanding payment.

Mensch Millwork did not dispute that it had entered into the collective bargaining agreement or made contributions to the Fund. It argued instead that it was not an “employer” under the Multiemployer Pension Plan Amendments Act because no written agreement directly between Mensch Millwork and the Fund showed an obligation to contribute. It characterized employer status as a threshold issue.

Court’s analysis

The court applied ERISA’s “pay now, dispute later” requirement. Under that system, an employer must begin making scheduled withdrawal-liability payments within the required period even if it seeks review of the amount or payment schedule. A plan sponsor ordinarily must show compliance with four procedural requirements: determining that the employer partially or completely withdrew, determining the amount of liability, notifying the employer of the liability and schedule, and demanding payment according to the schedule.

The court found that the Trustees satisfied all four requirements. The Fund determined that Mensch Millwork had completely withdrawn, calculated liability at $241,026, sent notice on April 3, 2023, provided the payment schedule, and later demanded the missed installment. Because Mensch Millwork failed to pay the first installment and did not cure the deficiency within 60 days, the court concluded that it had defaulted under the governing statute.

The court rejected Mensch Millwork’s argument as a reason to withhold interim payments. It stated that the employer-status issue was properly considered only when the underlying claims were finally decided and did not affect the Trustees’ right to interim payments during the lawsuit. The court also stated that Mensch Millwork did not initiate arbitration within the required period and therefore appeared to have waived its right to challenge the assessment through review or arbitration. Regardless, the court held that interim payments were required even while Mensch Millwork challenged the assessment.

Disposition

The court GRANTED the Trustees’ motion to compel interim withdrawal-liability payments. It directed Mensch Millwork to pay the eight interim payments totaling $154,950 within 60 days of the order and to make all additional quarterly installments under the April 3, 2023 assessment letter while the underlying action awaited final resolution. The Clerk of Court was directed to terminate the motion at ECF No. 38. The order did not finally decide the underlying dispute over Mensch Millwork’s status or ultimate withdrawal liability.