In the

United States Court of Appeals

For the Seventh Circuit

No. 00-1109

Robert J. Matz, individually and on

behalf of all others similarly situated,

Plaintiff-Appellee,

v.

Household International Tax 

Reduction Investment Plan,

Defendant-Appellant.

Appeal from the United States District Court

for the Northern District of Illinois, Eastern Division.

No. 96 C 1095--Joan B. Gottschall, Judge.

On Remand From

The United States Supreme Court

Submitted July 25, 2001--Decided September 7, 2001

 Before Bauer, Coffey, and Kanne, Circuit

Judges.

 Bauer, Circuit Judge. Robert J. Matz

filed an ERISA action, claiming

entitlement to benefits as a result of a

partial termination of a retirement

benefit plan. The district court held

that in determining whether partial

termination occurred: (1) both vested and

non-vested plan participants should be

counted, see Matz v. Household Int’l Tax

Reduction Inv. Plan, 1998 WL 851491, *5

(N.D. Ill. Dec. 1, 1998); and (2)

multiple plan years could be aggregated,

see 1999 WL 754659, *6 (N.D. Ill. Sept.

9, 1999). The Plan contested the district

court’s decisions on interlocutory

appeal, and in 227 F.3d 971 (7th Cir.

2000), we affirmed. The Plan petitioned

for writ of certiorari, which the Supreme

Court granted, thereby vacating and

remanding the case to us for further

consideration in light of United States

v. Mead Corp., 121 S. Ct. 2164 (2001). On

remand, we are faced with the question of

to what extent we must defer to the

interpretation of "partial termination"

by the IRS found in an amicus brief,

which is one of the agencies responsible
for administering the partial termination

statute.

 In Mead, the Supreme Court tried to

delineate levels of judicial deference

owed to actions by administrative

agencies. See id. at 2176. The Court held

that Chevron deference is mandatory when

Congress has expressly or implicitly

indicated that it intended an agency to

speak with the force of law on a matter,

and the agency’s position on that matter

is reasonable. See id. at 2171-72. The

Court explained that Congress generally

indicates its intention "when it provides

for a relatively formal administrative

procedure," such as "notice-and-comment

rulemaking or formal adjudication." Id.

at 2172-73. However, the Court left open

the possibility that Chevron deference

may be appropriate in some instances even

without such formality, although it did

not clearly outline these instances. See

id. at 2173.

 In delineating this spectrum of

deference, the Court confirmed its

holding in Skidmore v. Swift & Co., 323

U.S. 134 (1944) that "an agency’s

interpretation may merit some deference

whatever its form, given the ’specialized

experience and broader investigations and

information’ available to the agency . .

. ." Id. at 2175 (quoting 323 U.S. at

139). The Court instructed that

determining whether Skidmore deference is

owed turns on the "’thoroughness evident

in [the agency’s] consideration, the

validity of its reasoning, its

consistency with earlier and later

pronouncements, and all those factors

which give it power to persuade, if

lacking power to control.’" Id. at 2172

(quoting Skidmore, 323 U.S. at 140).

Generally, pursuant to Skidmore

deference, an agency’s position may be

accorded respect depending on its

persuasiveness. See id. at 2175-76.

 In our first opinion in this case we

echoed the district court’s sentiment

that if we were writing on a blank slate

we would be inclined to hold that only

non-vested participants ought to be

counted in determining whether partial

termination occurred. However, we felt

constrained by Chevron U.S.A., Inc. v.

Natural Res. Def. Council, Inc., 467 U.S.

837 (1984) to defer to the IRS’

reasonable interpretation of the partial

termination statute. In taking this posi
tion, we mimicked the reasoning in Weil

v. Retirement Plan Admin. Comm., 933 F.2d

106 (2d Cir. 1991). In Weil, the Second

Circuit asked the IRS to submit an amicus

brief regarding the meaning of "partial

termination." 933 F.2d at 107. Supported

by Revenue Rulings and its position in

the Plan Termination Handbook contained

in the Internal Revenue Manual, the IRS

submitted its interpretation that "’all

terminated participants, both vested and

non[-]vested, should be counted in

determining whether a partial termination

has occurred.’" Id. The Weil panel

deferred to the IRS’ offered position in

the amicus brief pursuant to Chevron.

And, in our first opinion in this case,

we deferred to the Weil court’s

deference.

 We now hold that the IRS’ position in

the amicus brief was an informal agency

policy pronouncement not entitled to

Chevron deference. See Callaway v.

C.I.R., 231 F.3d 106, 132-33 (2d Cir.

2000) (following Auer v. Robbins,

recognizing that the court had previously

afforded Chevron deference to an agency’s

position in an amicus brief, but holding

that the agency’s position in the brief

was inconsistent with positions it had

previously taken); Ball v. Memphis Bar-BQ Co., Inc., 228 F.3d 360, 365 (4th Cir.

2000) (holding that the Secretary of

Labor’s interpretation of the Fair Labor

Standards Act urged in an amicus brief

was not entitled to Chevron deference);

Doe v. Mutual of Omaha Ins. Co., 179 F.3d

557, 563 (7th Cir. 1999) (discussing Auer

and Chevron regarding the amount of

deference an amicus brief is due);

Commonwealth Edison Co. v. Vega, 174 F.3d

870, 875 (7th Cir. 1999) (same); but see

Auer v. Robbins, 519 U.S. 452, 462 (1997)

(affording Chevron deference to the

Secretary of Labor’s interpretation of

the Fair Labor Standards Act in its

amicus brief because it was not a post

hoc rationalization and reflected the

agency’s fair and considered judgment);

Jones v. American Postal Workers Union,

192 F.3d 417, 427 (4th Cir. 1999)

(relying on Auer to hold that the EEOC’s

interpretation of Title VII in its amicus

brief was entitled to Chevron deference

because it was not a post hoc

rationalization and reflected the

agency’s fair and considered judgment,

and was a valid interpretation). Although

the Supreme Court indicated in Mead that
Chevron deference may apply to

interpretations developed from less

formal rulemaking procedures, it did not

expressly outline when this would be the

case. The IRS’ position in the amicus

brief was not born from a formal

policymaking procedure. We do not believe

that a position set forth in an amicus

brief, supported by some Revenue Rulings

and an agency manual are formal enough to

warrant Chevron treatment. In Mead, the

Court declined to give Chevron deference

to a tariff classification ruling issued

by the United States Customs Service. 121

S. Ct. at 2174. The Court explained that

deference was not due because Congress

did not indicate that it meant to

delegate authority to Customs to issue

classification rulings with the force of

law, Customs did not engage in noticeand-comment practice when issuing the

rulings, and they were not binding on

third parties. See id. We do not consider

a position in an amicus brief to be more

deserving of Chevron deference than a

tariff classification ruling. Upon

reading Mead, we find that a litigation

position in an amicus brief, perhaps just

as agency interpretations of statutes

contained in formats such as opinion

letters, policy statements, agency

manuals, and enforcement guidelines, see

id. at 2175, are entitled to respect only

to the extent that those interpretations

have the power to persuade pursuant to

Skidmore.

 Therefore, since we are not bound by the

IRS’ position under Chevron, any

deference we afford it under Skidmore

depends on its thoroughness, validity,

consistency, and persuasiveness. As

noted, in our first opinion, although we

found the IRS’ position reasonable under

Chevron, we also found it unpersuasive.

As we noted, the meaning of "partial

termination" is unclear because the

statutory language is ambiguous, the

Treasury Regulation is not helpful, the

statutory framework offers no assistance,

and the legislative history provides

little more guidance. See Matz, 227 F.3d

at 974. Thus, we looked to the statute’s

purposes, which are to protect employees’

legitimate expectation of pension

benefits, and to prevent employers from

abusing pension plans to reap tax

benefits. See id. at 975. We agree with

the Plan that counting vested

participants "would further neither of

these purposes." Id. "Vested participants
do not need further protection for their

pension benefits and do not benefit from

a finding of partial termination. Their

benefits, by virtue of vesting, are

nonforfeitable. The employer gains

nothing either. No monies revert back to

it because the benefits are vested and

non[ ]forfeitable." Id. We agreed with

the notion voiced in Morales v. Pan Am.

Life Ins. Co., 718 F. Supp. 1297 (E.D.

La. 1989) and Weil that perhaps only nonvested participants ought to be counted,

although neither court so held. Since we

indicated that if we were writing on a

blank slate we would have held

differently, we now adopt the rule that

only non-vested participants should be

counted in determining whether partial

termination of a pension plan has

occurred. 

 Finally, the Plan asks us to reconsider

our holding that multiple plan years can

be aggregated in determining partial

termination. See Matz, 227 F.3d at 976-

77. We decline to do so. This aspect of

our holding paid no deference to the IRS

expressly because the IRS had not taken a

position on the issue. See Matz, 227 F.3d

at 977. Thus, since we analyzed the issue

without deference to the IRS, the Supreme

Court’s vacation and remand in light of

Mead did not implicate this holding;

therefore, it stands.

 Thus, we hold that only non-vested

participants should be counted in the

partial termination analysis, and hereby

Reverse and Remand this case to the

district court for further proceedings

consistent with this opinion.