number fifteen dash thirty four thirty four united food and commercial workers at all or through the rubber associates incorporated oral argument not to exceed fifteen minutes per side mr stone for the conditions are met when a risk is silent when there is an awkward gap in the statutory scheme where federal common law is essential to the promotion of fundamental risk of policies and let me address each of those considerations and reverse order because i think that's critical to this court's consideration and we think the district court there and its consideration of those issues the u s supreme court and one of its first cases to be decided after the multi employer pension here had as its fundamental purpose to discourage employer withdrawals from multiemployer plans the court held that the m m p a provided that employers who did withdraw would be required to pay their fair share the court stated supreme court stated that the purpose of the m m p a was to avoid a downward spiral of companies accident pension plans yet in the case at bar we have the first choice a case for an employer rubber associates wanted to stay in a mall employer plan robber associates offered to continue making pension payments yet through absolutely no fault of its own through the complicity of the pension plan and the united food commercial workers a correct ruling i'm sorry you admit that was a correct ruling by the arbitrator that it could not grant equitable relief well we think the we thought the statute was ambiguous on that issue we felt the arbitrator could however we did not object to that in our in our argument but the district court that we believe the district court clearly does have the power but your best case and supportive of your position has any circuit ever declared that what you're proposing now there's a number of cases your honor that hold that the courts have the right to fill gaps and there was a case of law the coloring case involving understand it what about a gap like this one made there there is this case that this is a case of first impression your honor there has been two cases where the let me backtrack for a moment we rely for guidance largely on a report by the p and the p g c determined that if there were union mandated withdraws different methods of calculating withdraw liability would be appropriate however it they left it to congress well they there had never  exception for in the m m p a fortan negligence of fun trustees in other words if they didn't manage the funds properly then there should be a cause of action for that that argument has been rejected time and time again and it because obviously the implications are extremely extremely adverse to arrest if thought if employers could argue that funds that fund trustees didn't invest properly that could create a floodgate of a tax on funds here's the situation's a lot different here the situation this is in the control of the unions and half the fun trustees are union representatives in fact the person who disclaimed interest in rubber associates was a fun trustee here it's completely controllable this is not something that the fund trustees are going to be liable for because they made some bad investment decisions this is a situation that is totally preventable they don't have the unions don't have to disclaim interest fun trust funds don't have to support that and that's what occurred here i think that cases is in a pleasurable because it involves a much different factual such i mean radically different factual situation  as well and most of these funds and unions have very close relationships the absence of any consequences for union mandated withdrawals provides a clear incentive to unions working with pensions funds which they partly control to issue a disclaimer of interest in order to penalize we can players to collect additional withdrawal liability particularly with an employer like robber associates where there's only a very two percent of their employees or even vested in the fund and such disclaimers would then help fund the plan for the potential benefit of other larger employers and the union at the expense of smaller weaker employers we think that in the long run this would be very still don't understand why it isn't up to congress to fix this soon that you're correct that this is a terrible problem why isn't it something that congress should fix with legislation well certainly congress could fix it by legislation but fourteen fifty one does charge the courts with making common law and the reality is your honour's that congress this is this why i think this is potentially a massive problem there are a lot of problems that congress has chosen not to fix that need  addressed in the courts are charged under reso with the ability to fix this issue it's not there we're asking the courts to go beyond its statutory grant in the courts courts have to quit a case of fraud but not just in the case of fraud then just take advantage of that under richard they knew what riches said sure they just said this is what you go write well we believe we believe certainly yes that the union and the fun new news since that person disclaimed interest was a union fun trustee she certainly knew the impact of what she was going to do what the union was going to do but the key situation to us your honor is that this was completely this was completely without any action disclaimed interest but those cases either involve unfair labor practices or involve the certifications or involve other things that the company could have foreseen and could have what the purpose of the m and p a amendments was to keep employers in fines here we have a situation ever been passed what they wanted to avoid was a downward spiral of more and more employers pulling out of plants here we have the exact situation reverse of that situation as i mentioned i think ultimately while the put this argument i think in the long run this will be very just especially once as a court of appeals decision on this there will this will be destabilising for the whole multi employer scheme because employers are faced with the fact union disclaim interested any time or almost any time and then the plus force not of the fund is going to cause great consternation among employers and they're going to look for opportunities to get out whenever the withdrawal liability have may drop a little bit so i think they'll long term by giving this much power to the unions and to the funds in complicity with the unions  could be it will be very alternately very destabilizing because you're creating a situation that is absolutely unavoidable certainly there are situations that employers are in voluntarily forced out of but this one is totally is something where the employer did the record shows the employer did everything possible to stay in the fund and yet were forced out of the day where they were painfully aware of the possibility and they did absolutely nothing to create the such an equitable relate would you have the court do your honor said if you ever need it here's what the rules are in the guide says the p b g c suggested three methods one was was a method involving calculations which the fun just doesn't have available so we were unable to even and basically that is the exit rubber associates has never said they shouldn't pay anything robert the the p p g c recommended in the situation was that they where a company was forced out as because of the union action that the  of the employer should pay its proportional share directly related to its participants in the plan and how much would that be here that would be three hundred twelve thousand dollars you not rebut it expert testimony ok your red light been on for a while you know i'm sorry fund a since the ninth circuit decision in the thompson case in one thousand nine hundred four where that court stated that in union mandated withdrawal is not a basis for a reduction in assessment of withdrawal liability no court has reduced an assessment of withdrawal liability based upon a union mandated withdraw and as the supreme court basically  explained in the concrete pipe decision in dealing with an array of arguments by the employer that this is just unfair to us and we do see you know some of these arguments of unfairness for contributing to contributing employers they're the employer had not a single employee with vested benefits in the supreme court said congress has acted and we're going to enforce the law as written since the one nine hundred ninety one p b g c study report and that's what it was a study report  congress has acted they acted in two thousand and six when they again amended the pension protection act and they strengthen protections for plan and plan participants in the case of withdraw liability mostly at the expense of the employer and those specific amendments to the rules are in our brief page forty and again just last year in two thousand and fourteen when congress allowed trouble plans to suspend benefit payments in some circumstances but the cost savings from benefits suspensions have to be ignored in calculating withdrawal liability congress was aware congress was was told not to act by the people congress did not act  to create this exception but it has acted in this field in meaningful ways since that report no court has reduced withdraw liability based on this union mandated withdrawal theory it's been mentioned a couple times the crown case in new jersey district court opinion in there they said well we're not going to forego interim payments because even under this withdrawal liability theory per the p b g c study report they still owe something  this court in the findlay opinion actually took a very meaningful look at the extent of the court's ability to exercise equitable relief in face of the clearly articulated the union declared a union mandated withdraw the employer went to federal court for injunctive relief claimed no obligation for withdraw liability because the withdraw heard during a labor dispute and claim no requirement to arbitrate based on the union mandated base nature of the withdraw in the majority opinion and judge moore and judge givens as you're aware this court held that the use of the court's equitable power in that case to enjoin interim payments in this case to create an entirely new formula for the draw liability after examining the rules in the other circuits determine that the supreme court has ruled that when district courts are properly acting as courts of equity they have discretion unless the statute clearly provides otherwise and this court in finley decided to follow the clear language involving with draw liability in the statute in that case to order interim payments quoting again from that decision once the pension fund has demonstrated that it complied with the statutory requirements for calculating liability and notifying the employer were not going to interfere with the comprehensive statutory scheme there was a specific provision directing conduct and that took precedence over a more general one especially as this court observed when the requested relief runs counter to the purpose of ensuring stability viability of the fund and this court even accepted that that ruling could result in unfair results again quoting where congress has already spoken specifically on an issue it is not the role of this court to remedy those situations your honour's it's hard to imagine a more pervasive comes up very very rarely and the fact that we've seen none of the parade of horribles suggested in the people you see report itself says it's in the opposite of the union's interest to walk away from dues paying members if i was senator experience is it something that occurs frequently i mean i know you just said the union this incident is in ninety ninety one it wasn't happening but it is at you more often you know i'm more of a litigator than a traditional labor lawyer but certainly not something that that happens in my world a little or mendelsohn that we see in any any sort frequency and as the facts of this case demonstrate i mean this was a very hard fought negotiation a hard fought strike imposition of final terms by the employer all of which they had the law for right to do but it takes two to tango and the scenario here shows the very dangerous path we go down and  start attributing fault to one party only when the parties reach impasse the union loses a strike and disclaims interest the three part test  one number one a recess silent ambiguous two there is an awkward gap in the statutory scheme and three federal common law is essential to promote a recent policy literally none of those three are in existence here we asked the question posed by this court and did you run a movie sam well in that case refusing to create a cause of action on behalf of the employer for negligent mismanagement of the fund what fundamental arisa policy would be served and in fact the result th rubber associates seeks is contrary to a receipt stated purpose to protect the participants rights to collect benefits congress was very clear on what its intent was and codified that intent in one nine hundred eighty in the m p p the policy was quoting to provide reasonable protection for the interests of participants and beneficiaries of financially distressed multiemployer pension plans and provide a financially self sufficient program for the guarantee of employee benefits under multiemployer plans all of the all of the all of the legislative history all of the court discussion of the purpose is to insure the viability of a plan to make sure if somebody is promised a pension and they with they need to do to earn that pension they can in fact receive their pension and it's hard to think of a more comprehensive scheme as the supreme court said in the canoe it's in case because the risk is that comprehensive and ridiculous that statute courts should be the rolling five and the direct attribution method and unless the fund trustees adopt an alternative calculation method for the plan with p b g c approval or amend the plan to adopt another method in orissa forty two eleven  with arista requires the withdrawal liability be calculated using the statutory presumptive method exactly as was done in this case there is a procedure the congress as an act that if you want to change your calculation you have to petition the p b g c they have to give you a proof so shoots that it will take one of those beds but you're saying they don't have the option to do so they're not acting for that then they're not seeking the direct attribution method they are seeking the modified direct attribution method and although i don't profess to understand the math behind these various formulas  the the the problem is the p p g c will only give approval for an alternate formula if it would not significantly increase risk of loss to plan participants the modified direct attribution method which was discussed as one choice of three in a study report that never became the law does not provide for rubber associates to be allocated a share of unfunded vested benefits that cannot be collected from withdrawn employers so actually the modification to the direct attribution method would make it ineligible for people g c approval under the statute itself how much would they have to pay on the direct retribution without the modification do you have any idea i do not know your honor the amount was in the area of one point seven under the presumptive method but they also have opted for the twenty year payment plan and as your honour's also know under the law and this is another acknowledgment of the situation employers may be in there's a stream of payment for twenty years and then the obligation ends even if the entire sum has not been paid and i think the present value of that amount is under seven figures estoppel claim that that participant hands the court might in force that promise where an employer is fraudulent neatly fraudulently induced to participate to enter a plan that is another situation that is a far far cry from creating an entire new calculation for assessing withdraw liability when the court when the congress sets out the the choices and gives you a very detailed procedure if you want to use another choice in the limited thing that it raised in the briefing as i recall was that the argument that your opponent was making that there was collusion between the the fund in the union is a realize i'm going beyond what you were just talking about but you're mentioning the word fraud caused me to think about that right so here is what is pointed to in the record to support first of all there is acted in violation of any of its statutory obligations in fact it's stipulated that we assessed withdraw it that there was a with raul and we properly assessed liability under the presumption that so the only question is should we have used a new that's found nowhere in the rest unlike the culture here in case the third circuit where there was fraudulent inducement here first of all fraud wasn't alleged but for there beat to be collusion there needs to be some sort of a fraudulent misconduct so what are the allegations number one half of the trustees or union trustees including union trustees involved in the very bargaining relationship with this employer well that's the taft hartly act that's the l m r a of one nine hundred forty seven section three to see five that requires the employers in the union to be equally represented in the union representatives in the funder going to be the union membership that is the law and if congress thinks that creates an awkward or unfair situation only they can change though this will happen in every single case you're saying if if the law requires this overlap christie's right you might not have the situation where one of the trustees was actually the the union official who signed the letters saying that we disclaim interest but you're always going to have the leadership of that local union absolutely that's who serve on these ten taft hartly funds  they say that we share space with the union we rent space actually once again that is a practice so common that the department of labor issued a prohibited transaction class exemption to specifically allow for this to continue finally they point to the fact that we relied upon our actuary from the single company henry wanting his opinion that during negotiations they were at sixty two cents contributions rober associates wanted to limit the contribution to thirty cents or actuary told us that the contribution rate would have actually have to be increased to a dollar in a penny in order to allow the participants to continue to accrue benefits when  funding would be in a better funding status from a complete withdrawal than from allowing robber associates to slash its pension contributions that was the obligation of the fund to to rely upon the actuaries best best advice and b analogy the chicago truck driver helpers and warehouse workers union case the seventh circuit judge posner found it reversible error that the funded not consistently rely upon the siegel company's best estimate in that case which dealt with interest assumptions in conclusion your honour's in her opinion judge leroy refused to rely on the p b g c study reporting create special rules for union mandated withdrawals in fact she noted the parties do not dispute the congress has not acted on the report amended arista or adopted any special rules or methods for calculating employer withdrawal liability in the case of union mandated withdrawals from a multi employer funked she refused to grant equitable relief to with reduced the withdrawal liability concerned there first first of all the the fun argues several things inappropriately first of all it cites  this is on a motion dismiss that the fun filed facts have to be construed as the court well knows and has plaid they cannot go into the record and question things i do not think mr wang's comments were quite innocuous as mr wolf stated but to me the critical thing here as far as collusion goes and complicity were not claiming it's for that's fraud but we think it's like did you think in the a claim that you were making as to collusion what exactly did you say we said the two was the most some of the issue is the fact that miss caruso who is a fun trustee is the very person who disclaimed interest so she was clear and she was at meetings where mr wong and others discussed that the fund would be ahead if they collected withdrawal liability and that's in your claim yes your statement of it yes yes your honor and certainly there are supporting facts a couple which mr wolf referred to the fact that the union officials had more than just rented space and they had full access to the fund offices but the most important thing is in this caruso was the person disclaimed interest so she case fundamentally dealt with the obligation to arbitrate and also joked of relief but the court specifically states stated in reviewed the p v g c report did not say that it was not a source of guidance it simply said that i quote there's a preliminary problem with families argument the study report finds union mandated withdraws requiring that the fund refused to accept continued contributions proffered by the employer finley did not proffer continued contributions instead inform the fund it would not pay we offered to pay we have consistently offered to pay and we have consistently met all our with our obligations even while this case has been pending so there's we believe the we don't believe this case court ruled on that issue finally just the pv the court mentions me the fun mentions of the p g c approvals required in any situation that was not the courts would not require that bond richer culture and central states mason dixon a number of