RECOMMENDED FOR PUBLICATION

Pursuant to Sixth Circuit I.O.P. 32.1(b)

File Name: 21a0227p.06

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT

SOFCO ERECTORS, INC.,

Plaintiff-Appellee/Cross-Appellant,

v.

TRUSTEES OF THE OHIO OPERATING ENGINEERS 

PENSION FUND; OHIO OPERATING ENGINEERS PENSION 

FUND,

Defendants-Appellants/Cross-Appellees.

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Nos. 20-3639/3671

Appeal from the United States District Court for the Southern District of Ohio at Columbus.

No. 2:19-cv-02238—Algenon L. Marbley, District Judge.

Argued: January 29, 2021

Decided and Filed: September 28, 2021

Before: COOK, GRIFFIN, and LARSEN, Circuit Judges.*

_________________

COUNSEL

ARGUED: Daniel J. Clark, VORYS, SATER, SEYMOUR AND PEASE LLP, Columbus, 

Ohio, for Appellants/Cross-Appellees. Gary L. Greenberg, JACKSON LEWIS P.C., Cincinnati, 

Ohio, for Appellee/Cross-Appellant. Michael J. Prame, GROOM LAW GROUP, 

CHARTERED, Washington, D.C., Yaakov M. Roth, JONES DAY, Washington D.C., for Amici 

Curiae. ON BRIEF: Daniel J. Clark, Allen S. Kinzer, Daniel E. Shuey, VORYS, SATER, 

SEYMOUR AND PEASE LLP, Columbus, Ohio, for Appellants/Cross-Appellees. Gary L. 

Greenberg, Mark B. Gerano, JACKSON LEWIS P.C., Cincinnati, Ohio, for Appellee/CrossAppellant. Michael J. Prame, GROOM LAW GROUP, CHARTERED, Washington, D.C., 

Yaakov M. Roth, JONES DAY, Washington D.C., Adam G. Unikowsky, JENNER & BLOCK 

LLP, Washington, D.C., Andrew M. Johnstone, US FOODS, INC., Rosemont, Illinois, Thomas 

W.H. Barlow, KOSTOPOULOS RODRIGUEZ, PLLC, Birmingham, Michigan, Gregory J. Ossi, 

*The Honorable Deborah L. Cook participated in this decision before she took inactive senior status on 

August 27, 2021.

>
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FAEGRE DRINKER BIDDLE & REATH LLP, Washington, D.C., Kathleen Keller, 

BREDHOFF & KAISER, P.L.L.C., Washington, D.C., Ronald L. Mason, Aaron T. Tulencik, 

MASON LAW FIRM CO., LPA, Dublin, Ohio, Brendan Collins, GKG LAW, P.C., Washington, 

D.C., for Amici Curiae.

LARSEN, J., delivered the opinion of the court in which COOK, J., joined, and 

GRIFFIN, J., joined in all but Part IV. GRIFFIN, J. (pp. 31–33), delivered a separate opinion 

concurring in part and dissenting in part.

_________________

OPINION

_________________

LARSEN, Circuit Judge. Sofco Erectors, Inc. terminated its collective bargaining 

agreement with a local union. The Ohio Operating Engineers Pension Fund then assessed almost 

a million dollars in withdrawal liability against Sofco under the Employee Retirement Income 

Security Act (ERISA). Sofco challenged the assessment on several grounds in ERISA-mandated

arbitration. The arbitrator upheld the assessment, but the district court affirmed in part and 

reversed in part. The Fund appealed, and Sofco cross-appealed. For the reasons that follow, we 

AFFIRM in part, REVERSE in part, VACATE in part, and REMAND for further proceedings.

I. Background 

A. Legal Background

Through ERISA, Congress created a comprehensive statutory scheme to regulate private 

pension plans. Nachman Corp. v. PBGC, 446 U.S. 359, 361–62 (1980) (citing 29 U.S.C. 

§ 1001(a)). Informed by nearly a decade of research, id. at 361, ERISA established reporting and 

disclosure requirements, 29 U.S.C. § 1021; minimum funding standards, id. § 1082; fiduciary 

duties, id. § 1104; and plan termination insurance, id. §§ 1322, 1322a. It also established the 

Pension Benefit Guaranty Corporation (PBGC), an administrative agency under the Department 

of Labor that manages the plan termination insurance program. See id. § 1302; PBGC v. LTV 

Corp., 496 U.S. 633, 637 (1990). 

ERISA differentiates between single-employer and multiemployer pension plans. See

29 U.S.C. § 1002(41). Multiemployer plans are “maintained pursuant to one or more collective 
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bargaining agreements,” “to which more than one employer is required to contribute.” Id.

§ 1002(37)(A)(i), (ii). These plans provide benefits for union members who work for 

employers in the same industry. See PBGC, Introduction to Multiemployer Plans, 

https://www.pbgc.gov/prac/multiemployer/introduction-to-multiemployer-plans (Sept. 13, 2021). 

Employees do not sacrifice pension benefits by working for multiple employers because service 

for any contributing employer is credited by the plan. Concrete Pipe & Prods. of Cal., Inc. v. 

Constr. Laborers Pension Tr. for S. Cal., 508 U.S. 602, 605–06 (1993). A board of trustees 

administers these plans. Participating unions select half of the board’s members; contributing 

employers select the other half. Connolly v. PBGC, 475 U.S. 211, 232 (1986) (O’Connor, J., 

concurring).

ERISA requires that multiemployer pension funds prepare annual financial reports and 

actuarial valuations. E.g., 26 U.S.C. § 6059; 29 U.S.C. § 1023. The funds must also meet 

minimum-funding standards. 26 U.S.C. §§ 412, 431; 29 U.S.C. §§ 1082, 1084. If they do not, 

contributing employers are subject to a tax. 26 U.S.C. § 4971. In addition, funds become 

subject to certain rehabilitation requirements if their funding levels are too low. See id. § 432. 

In the late 1970s, Congress directed the PBGC to report on the challenges of insuring 

multiemployer pension plans and to propose legislative solutions. PBGC v. R.A. Gray & Co., 

467 U.S. 717, 721 (1984); S. Rep. No. 95-570, at 7 (1977). The PBGC found that ERISA did 

not adequately protect multiemployer plans from individual employer withdrawals. R.A. Gray, 

467 U.S. at 722; PBGC, Multiemployer Study Required by P.L. 95–214, at 95 (1978). As the 

Supreme Court noted:

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.
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Connolly, 475 U.S. at 216 (quoting Pension Plan Termination Insurance Issues: Hearings before 

the Subcomm. on Oversight of the H. Comm. on Ways and Means, 95th Cong., at 22 (1978) 

(statement of Matthew M. Lind)). Thus, the PBGC recommended imposing withdrawal liability 

on employers leaving multiemployer plans, requiring them to pay for their “fair share of the 

plan’s unfunded liabilities.” R.A. Gray, 467 U.S. at 723 & n.3 (quoting Lind at 23). This would 

both discourage withdrawals and protect plans from their negative financial effects. Connolly, 

475 U.S. at 217. Congress incorporated these recommendations into the Multiemployer Pension 

Plan Amendments Act (MPPAA), Pub. L. 96-364, 94 Stat 1208, 29 U.S.C. §§ 1381–1461, which 

became law on September 26, 1980. Concrete Pipe, 508 U.S. at 609. 

The MPPAA imposes liability for complete and partial withdrawals from multiemployer 

pension plans. See 29 U.S.C. §§ 1383, 1385. But Congress designed special rules for the 

construction industry because its work often fluctuates and is done on a project-by-project basis. 

See id. §§ 1383(b), 1388(d); see also Definition of “Building and Construction Industry,” 47 Fed. 

Reg. 42588-02, 1982 WL 132214 (proposed Sept. 28, 1982). When a construction employer 

stops contributing to a plan (for example, because its project is over), the plan’s contribution 

base does not necessarily decline in response; the workers employed by the withdrawing 

construction firm are often hired for other projects by other contributing employers. H.C. Elliott, 

Inc. v. Carpenters Pension Tr. Fund for N. Cal., 859 F.2d 808, 811 (9th Cir. 1988). The plan is 

not threatened as long as contributions continue to be made for work done in that area. Id. at 

812. Thus, the construction industry rules focus on whether the employer, though no longer 

contributing to the plan, continues to perform work for which contributions were previously 

required. Id. Only then is withdrawal liability imposed. See id.; 29 U.S.C. § 1383(b)(2). 

Lastly, through ERISA and the MPPAA, Congress has established a comprehensive 

scheme for assessing and challenging an assessment to withdrawal liability. Concrete Pipe, 

508 U.S. at 609. When an employer withdraws from a multiemployer plan, the plan sponsor is 

responsible for assessing withdrawal liability and sending the employer a demand for payment. 

29 U.S.C. §§ 1382, 1399. The plan sponsor is the organization that establishes and maintains the 

plan. Id. § 1002(16)(B). Here, the sponsor is the Ohio Operating Engineers Pension Fund (the 

Fund). Withdrawal liability is calculated by professional actuaries who must use “actuarial 
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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.” Id. § 1393(a)(1). If the 

employer disagrees with the assessment, it can request that the plan review it. Id.

§ 1399(b)(2)(A). 

ERISA prohibits employers from challenging a plan’s assessment directly in federal 

court; the plan and the employer must arbitrate their disputes first and then appeal the arbitrator’s 

decision. Id. § 1401(a)(1), (b)(2). The arbitrator must presume that the plan sponsor’s factual 

determinations are correct unless the employer disproves a determination by a preponderance of 

the evidence. Id. § 1401(a)(3)(A); Sherwin-Williams Co. v. N.Y. State Teamsters Conf. Pension 

& Ret. Fund, 158 F.3d 387, 392 (6th Cir. 1998) (citing Concrete Pipe, 508 U.S. at 629). To 

challenge an actuary’s calculation of withdrawal liability, the employer must show “that the 

actuarial assumptions and methods used in the determination were, in the aggregate, 

unreasonable (taking into account the experience of the plan and reasonable expectations), or the 

plan’s actuary made a significant error in applying the actuarial assumptions or methods.” 

29 U.S.C. § 1401(a)(3)(B). On review in federal court, “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.” Id. § 1401(c). 

B. Factual and Procedural History

Sofco Erectors, Inc. is a building company that erects steel and precast for commercial 

buildings and hospitals. It works in parts of Ohio, Kentucky, and Indiana. It began operations 

on April 1, 2004, when the company owners purchased the assets of its predecessor, also called 

Sofco Erectors, Inc. (Old Sofco). The owners of Sofco worked at Old Sofco but did not own any 

part of it. Sofco did not assume any of Old Sofco’s obligations or liabilities.

Sofco has signed collective bargaining agreements (CBAs) with several unions. It has 

agreements with three different local chapters of the International Association of Bridge, 

Structural, Ornamental, and Reinforcing Iron Workers (Ironworkers). It also had an agreement 
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with the International Union of Operating Engineers, Local 18 (Local 18). Sofco hired Local 18 

primarily to operate cranes, both those owned by Sofco and those rented from other companies.

Sofco terminated its CBA with Local 18, effective April 28, 2017, largely because of 

disagreements over Sofco’s assigning of forklift work to the Ironworkers. The Fund then 

assessed withdrawal liability against Sofco for $824,300: complete-withdrawal liability of 

$368,315 for the plan year ending July 31, 2017; partial-withdrawal liability of $344,627 for the 

plan year ending July 31, 2011; and partial-withdrawal liability of $111,358 for the plan year 

ending July 31, 2012. It also found that a partial withdrawal had occurred for the plan year 

ending July 31, 2013, but that the liability for that year was $0. Following the Fund’s demand 

for payment, Sofco requested review of the determination. After the Fund failed to respond to 

Sofco’s request, Sofco initiated arbitration. See 29 U.S.C. § 1401(a)(1). Sofco began making 

quarterly payments, as required, on October 18, 2017, and paid its balance on October 17, 2019. 

See id. § 1399(c).

In arbitration, Sofco and the Fund filed cross motions for summary judgment. The 

arbitrator granted summary judgment in the Fund’s favor on all issues. He determined that the 

forklift work and shop work Sofco disputed were in Local 18’s jurisdiction and that Sofco was 

required to contribute to the fund for that work; that the Fund had properly assessed completewithdrawal liability; that the Fund properly assessed partial-withdrawal liability because Sofco’s 

contributions dropped to an “insubstantial” level; that the Fund had properly included the 

contribution history of Sofco’s predecessor in its withdrawal-liability calculations; and that the 

interest rate the Fund had used to calculate withdrawal liability was reasonable.

Sofco filed a complaint seeking to vacate or modify the arbitration award in federal court. 

The Fund moved to enforce the award, and Sofco moved for summary judgment. The district 

court granted summary judgment in favor of Sofco on two issues. First, it held that Sofco was 

not required to make contributions for shop work. Sofco Erectors, Inc. v. Trs. of the Ohio 

Operating Eng’rs Pension Fund, No. 2:19-cv-2238, 2020 WL 2541970, at *7–8 (S.D. Ohio May 

19, 2020). Second, it held that, although the interest rate used by the Fund to calculate 

withdrawal liability need not always be the same as that used for minimum funding purposes, the 
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interest rate used here was unreasonable because it was not the actuary’s “best estimate of the 

anticipated experience under the plan.” Id. at *8–10; see 29 U.S.C. § 1393(a)(1).

But the district court upheld the arbitrator’s determination and granted the Fund’s motion 

to enforce on three issues: that forklift work was properly included in the Fund’s withdrawal 

determination, Sofco, 2020 WL 2541970, at *7; that it was proper for the Fund to include Old 

Sofco’s contribution history in its calculations, id. at *10; and that the Fund had 

properly determined that Sofco’s contributions fell to an “insubstantial” level, thus triggering 

partial-withdrawal liability, id. at *10–11. Both parties moved for attorney’s fees. Because “this 

was a close case” and “both parties [] prevailed on issues,” the court denied both motions. Id. at 

*11–12. 

The Fund appealed the district court’s order, and Sofco cross-appealed. 

II. Standard of Review

We review a district court’s grant of summary judgment de novo. Cent. States, Se. & Sw. 

Areas Pension Fund v. Int’l Comfort Prods., LLC, 585 F.3d 281, 284 (6th Cir. 2009). Summary 

judgment is appropriate where “there is no genuine dispute as to any material fact and the 

movant is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a). We presume that 

findings of fact made by the arbitrator are correct unless the challenging party can disprove them 

by a preponderance of the evidence. 29 U.S.C. § 1401(c). We review questions of law de novo. 

Sherwin-Williams, 158 F.3d at 393; see also Concrete Pipe, 508 U.S. at 630. 

III. The Interest Rate

The primary dispute in this case is the propriety of the interest rate assumption the Fund 

used to calculate withdrawal liability. Multiemployer plans are considered “defined benefit 

plans.” See Concrete Pipe, 508 U.S. at 607. Such plans guarantee a certain monthly benefit, 

determined by a formula established by the plan, payable to beneficiaries for the rest of their 

lives. Pension Rev. Bd., Understanding the Basics of Actuarial Methods 2 (April 2013), 

https://www.prb.texas.gov/txpen/wp-content/uploads/2019/11/finalbasicsofactmethod.pdf. 

Employer contributions to the plan are dictated by the terms of the CBAs to which it is a party. 
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PBGC, Introduction to Multiemployer Plans. For example, an employer might be required to 

contribute a specific dollar amount per hour of hired labor. Id.

Pension funds hire actuaries to prepare annual reports and calculate funding levels and 

withdrawal liability. E.g., 26 U.S.C. §§ 431, 6059; 29 U.S.C. §§ 1023, 1084, 1393. Generally, 

employer contributions plus the income generated from them need to be sufficient to pay future 

benefits and cover administrative expenses. See Pension Rev. Bd., Basics of Actuarial Methods

at 2. Determining a fund’s future liabilities, or how much it will have to pay out in benefits, 

requires actuaries to make assumptions about how many employees will vest their benefits, how 

much they will receive in benefits, and how long they will live. See id. at 2, 4–5, 10–12. Once 

an actuary determines how much the fund will need to spend on benefits payments and 

administrative costs, it must determine the present value of future liabilities—how much the fund 

needs in assets today in order to pay those liabilities in the future. See id. at 2, 4–6. This 

requires the actuary to make certain assumptions about the income the assets will generate. See 

id. at 4–5; see also Nat’l Ret. Fund v. Metz Culinary Mgmt., Inc., 946 F.3d 146, 148 (2d Cir. 

2020). If the actuary assumes that the fund’s investments will have a higher long-term growth 

rate, then the fund will not need as many assets today to pay liabilities in the future. Pension 

Rev. Bd., Basics of Actuarial Methods, at 4–5. However, if the actuary assumes a lower longterm growth rate, the fund will need more assets now to pay those liabilities in the future (and 

thus may have to take in more money through contributions). Id. The actuary must then 

compare the present value of future liabilities (how much money do we need?) to the current 

assets in the fund (how much money do we have?). See Metz, 946 F.3d at 147–48 (citing R.A. 

Gray, 467 U.S. at 725). This can be done by looking at the market value of those assets. 

Pension Rev. Bd., Basics of Actuarial Methods, at 6; R.A. Gray, 467 U.S. at 725. If the fund has 

less money than it needs, then there is an unfunded liability. See Pension Rev. Bd., Basics of 

Actuarial Methods, at 7; R.A. Gray, 467 U.S. at 725. The interest-rate assumption is a critical 

factor in determining the present value of future liabilities. The higher the interest rate, the less 

money the fund needs today to pay liabilities in the future. The lower the interest rate, the more 

money the fund needs today.
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The interest-rate assumption is also critical to minimum-funding calculations. 

Minimum-funding standards require pension funds to have a certain amount of assets to pay their 

future liabilities. See 26 U.S.C. §§ 412, 431; 29 U.S.C. §§ 1082, 1084. As mentioned above, 

when funds fall below certain funding levels, employers contributing to the fund may be taxed or 

face other regulatory burdens. See 26 U.S.C. § 4971. For minimum-funding purposes, a higher 

interest-rate assumption is more favorable for the fund because it makes it easier to meet 

minimum-funding standards. 

The interest-rate assumption is critical in withdrawal-liability calculations too. A lower 

interest rate garners a higher unfunded liability. Because employers withdrawing from funds 

must pay a proportionate amount of the unfunded liability, see R.A. Gray, 467 U.S. at 725, a 

lower interest-rate assumption results in higher withdrawal liability. For withdrawal-liability 

purposes, a lower interest-rate assumption is more favorable for the fund.

A. The Fund’s Calculations

Here, the Fund’s actuary used a 7.25% growth rate on assets for minimum funding 

purposes. But for withdrawal-liability purposes, the actuary used the “Segal Blend,”1 which 

takes the interest rate used for minimum-funding purposes and “blend[s]” it with the PBGC’s 

published interest rates on annuities. The PBGC publishes interest rates on annuities because, in 

certain circumstances, pension funds are required to purchase annuities to cover promised 

benefits. 29 U.S.C. § 1341a(c)(2). Here, the PBGC rates were in the range of 2–3%.

The arbitrator upheld the actuary’s use of the Segal Blend, finding that it was “in the 

aggregate, reasonable.” He also noted that using this blend reflected “accepted actuarial 

practice” and was in accordance with PBGC Opinion Letter 86-24, which concluded that ERISA 

does not require that the same actuarial assumptions be used in withdrawal-liability and 

minimum-funding calculations. The district court overturned the arbitrator’s decision. Sofco, 

2020 WL 2541970, at *10. It held that while using two different interest rates was not per se 

1The Segal Blend was developed in the 1980s, shortly after the MPPAA was passed, and is primarily used 

by actuaries employed by The Segal Group, Inc. Segal Co., What is the Segal Blend?,

https://www.segalco.com/consulting-insights/segal-blend (Oct. 22, 2020); Combs v. Classic Coal Co., No. 84–1562, 

1990 WL 66583, at *3 n.5 (D.D.C. Apr. 6, 1990).
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unlawful, the actuary’s use of the Segal Blend here violated ERISA because it did not comport 

with the statute’s command that the interest rate assumption be the “actuary’s best estimate of 

[the] anticipated experience under the plan.” 29 U.S.C. § 1393(a)(1); see Sofco, 2020 WL 

2541970, at *9–10. 

 What is acceptable under ERISA and controlling Supreme Court caselaw is a question 

of law that we review de novo. Wilson v. Safelite Grp., Inc., 930 F.3d 429, 433 (6th Cir. 2019). 

B. ERISA and The Segal Blend

Sofco raises two principal challenges to the Fund’s assessment of withdrawal liability. 

First, it argues that both ERISA and the Supreme Court’s decision in Concrete Pipe forbid the 

actuary from using one interest rate for minimum funding purposes and another to calculate 

withdrawal liability. It points to the fact that the statutory directions for calculating minimum 

funding are almost identical to the language directing calculation of withdrawal liability; the 

actuary must use “actuarial assumptions and methods, each of which is 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.” 26 U.S.C. § 431(c)(3); 

29 U.S.C. § 1084(c)(3) (emphasis added). In both contexts, Congress required that the actuary’s 

estimate be based on the “anticipated experience under the plan.” It also argues that the Supreme 

Court in Concrete Pipe upheld ERISA’s statutory presumptions in favor of the actuary in large 

part because this textual requirement limits the actuary’s discretion by requiring that the same 

assumptions be used in both contexts. Second, Sofco argues that, even if the interest rates could 

be different, the interest rate used to calculate withdrawal liability here did not comport with the 

statute because it was not based on the actuary’s “best estimate of anticipated experience under 

the plan.” See 29 U.S.C. § 1393(a)(1). Because we agree with Sofco on the second point, we 

need not decide the first. 

ERISA says that an actuary calculating withdrawal liability must use “actuarial 

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.” Id. (emphasis added). 
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The statute allows the PBGC to promulgate regulations requiring alternative assumptions or 

methods for calculating withdrawal liability, but the agency has not done so. Id. § 1393(a)(2); 

see also 29 C.F.R., Subtitle B, Chapter XL, Subchapter I. The default rule of § 1393(a)(1) 

therefore applies: the actuary’s estimate must be based on the “anticipated experience under the 

plan.” The actuary’s use of the Segal Blend fails for this very reason. 

The Segal Blend is a weighted blend of the interest rate used for minimum-funding 

purposes and annuity rates published by the PBGC. The PBGC rates are used to determine the 

present value of future liabilities for plans that are terminated by a “mass withdrawal,” which 

occurs when all employers completely withdraw from a multiemployer plan. Id. §§ 1383(b)(3), 

1341a(a)(2), 1441(b); 29 C.F.R. § 4281.13(a) (2021); see also PBGC, ERISA 4044 Annuities, 

https://www.pbgc.gov/prac/interest/ida (Sept. 15, 2021). When a plan undergoes a mass 

withdrawal, the plan must purchase annuities to cover the promised benefits unless the plan 

assets can be distributed “in full satisfaction” of all covered benefits. 29 U.S.C. § 1341a(c)(2). 

Using the Segal Blend here violates the statute because the resulting interest rate is not 

“the actuary’s best estimate of anticipated experience under the plan.” Id. § 1393(a)(1). Rather, 

it dilutes the actuary’s best estimate with rates on investments that the plan is not required to and 

might never buy, based on a set formula that is not tailored to “the unique characteristics of the 

plan.” Bd. of Trs., Mich. United Food & Com. Workers Unions v. Eberhard Foods, Inc., 

831 F.2d 1258, 1263 (6th Cir. 1987). An actuary using the Segal Blend is factoring in an interest 

rate used for plans that essentially go out of business, even though these plans are neither going 

out of business nor required to purchase annuities to cover the departing employer’s share of 

vested benefits. 

That’s what happened in this case. The actuary testified that the 7.25% interest rate he 

used for minimum-funding purposes was based on “past experiences and future expectations 

taking into account the plan’s asset allocation and expected returns.” But when testifying that 

the Segal Blend was his “best estimate calculation basis,” the actuary explained that “the way 

you settle up a multiemployer pension plan is by using those—is by doing an annuity purchase 

on behalf of all the participants, and the interest rates published by PBGC approximate annuity 
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purchase rates.” In other words, the actuary justified the rate used for withdrawal liability by 

considering a hypothetical mass withdrawal, rather than the “anticipated experience under the 

plan,” 29 U.S.C. § 1393(a); by looking to assets that the fund has not indicated it will ever 

purchase, rather than the fund’s actual portfolio, see Eberhard Foods, 831 F.2d at 1263; and by 

factoring in rates mandated by the PBGC in other contexts, but not here, instead of looking at the 

“experience of the plan and reasonable expectations,” 29 U.S.C. § 1393(a). While the actuary’s 

true “best estimate” deserves deference, it must be his “best estimate of anticipated experience 

under the plan.” 

The Fund defends the use of the Segal Blend on three grounds. It begins by directing us 

to Rhoades, McKee & Boer v. United States, 43 F.3d 1071 (6th Cir. 1995). There, we described 

the “best estimate” language as being “procedural,” not “substantive.” Id. at 1075. And in so 

doing, the Fund argues, we stripped the statute’s requirement that actuaries base their estimates 

on the “anticipated experience under the plan” of any limiting force.

The Fund misunderstands Rhoades. There, we held that language identical to that used in 

§ 1393(a)(1) “establishes a two-part test for actuarial assumptions: (1) they must be reasonable; 

and (2) they must be the actuary’s best estimate.” Id. at 1073. The government in that case had 

challenged the actuary’s assumptions as “too conservative.” Id. at 1074. Relying on out-ofcircuit caselaw, we described the “best estimate” requirement as procedural and said that it “does 

not place a second substantive hurdle in the path of actuarial assumptions.” Id. at 1075. Thus, 

the “best estimate” requirement is not aimed at coming up with the most 

“accura[te] . . . predictive calculation.” Vinson & Elkins v. Comm’r of Internal Revenue, 7 F.3d 

1235, 1239 (5th Cir. 1993). The actuary’s estimate does not need to withstand the scrutiny of 

“outside experts” who suggest a different figure is “best.” See Rhoades, 43 F.3d at 1074; Vinson 

& Elkins, 7 F.3d at 1238. Rather, it serves “principally” to “[e]nsure that the chosen assumptions 

actually represent the actuary’s own judgment rather than the dictates of plan administrators or 

sponsors.” Rhoades, 43 F.3d at 1075 (quoting Wachtell, Lipton, Rosen & Katz v. C.I.R., 26 F.3d 

291, 296 (2d Cir. 1994)). If they do, the court will not “second-guess” those assumptions on the 

ground that some other assumptions might have been better. See id. at 1074 (quoting Vinson & 

Elkins, 7 F.3d at 1238). This enables “actuaries to incorporate a degree of conservatism in their 
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estimates,” “‘provided the chosen assumption is the actuary’s best estimate of anticipated plan 

experience.’” Id. at 1075 (quoting Wachtell, 26 F.3d at 296) (emphasis added). 

The proviso is important. Nothing in our cases suggests that actuaries may disregard the 

statute’s requirement that they base their estimates on the “anticipated experience under the 

plan.” 29 U.S.C. § 1393(a)(1). “[T]he statutory scheme contemplates that the actuary will be 

determining an interest rate based on the unique characteristics of the plan—not dictating the 

future investment portfolio of the plan.” Eberhard Foods, 831 F.2d at 1263. While “an element 

of conservatism [may be] appropriate in the selection of actuarial assumptions . . . factoring in a 

discount for conservatism after an actuary has arrived at his or her best estimate of anticipated 

experience would be contrary to the statutory mandate.” Wachtell, 26 F.3d at 296. 

The Fund offers two more arguments in defense of the Segal Blend. Both depend on 

characterizing an employer withdrawal as a “final settlement” with the fund. See Segal Co., 

What is the Segal Blend?, https://www.segalco.com/consulting-insights/segal-blend. Neither is 

persuasive. 

First, the Fund contends that blending the actuary’s growth-rate assumption with the 

interest rate on risk-free annuities is fair because this transfers investment risk from the pension 

fund to the withdrawing employer. Perhaps this is a laudable policy proposal. But, even if it 

is, we see no indication in the statute that Congress has adopted it. ERISA does incorporate a 

risk-shifting regime for mass withdrawals, which the statute does treat as a “settlement.” See

29 U.S.C. § 1341a(c)(2). And certain parts of the statute do direct actuaries to make calculations 

“without taking into account the experience of the plan.” See id. § 1084(c)(6)(E). But there is 

nothing in the statutory text to indicate that ERISA adopted a similar regime for individual 

withdrawals from multiemployer plans. Nor can we find any suggestion that Congress intended 

to give an actuary the discretion to dilute her best estimate of anticipated experience under the 
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plan in order to shift risk onto the departing employer. The PBGC has not adopted this approach 

either.2 

The Fund next argues that treating a withdrawal as a one-time settlement is an “accepted 

actuarial practice,” as reflected in Actuarial Standard of Practice No. 27 § 3.9. That seems to be 

true. But ERISA does not yield to the Actuarial Standards of Practice; the standards must 

succumb to the statutory requirements. Here, the standards offer an alternative: “[t]he actuary 

may use a discount rate that reflects the anticipated investment return from the pension fund,” or 

“[a]n actuary measuring a plan’s present value of benefits on a defeasance or settlement basis 

may use a discount rate implicit in annuity prices or other defeasance or settlement options.” 

Actuarial Standards Bd., Actuarial Standard of Practice No. 27, § 3.9(a), (b). As between these 

two professionally accepted standards, ERISA requires the former: an actuary must choose a rate 

that reflects “anticipated experience under the plan.” 29 U.S.C. § 1393(a)(1). 

It is no answer to say, as the Fund does, that ERISA places the burden on the employer to 

show “that the actuarial assumptions and methods used in the [withdrawal liability] 

determination were, in the aggregate, unreasonable.” Id. § 1401(a)(3)(B). It is true that Concrete 

Pipe described this language as casting on employers the “burden to show that the combination 

of methods and assumptions employed in the calculation would not have been acceptable to a 

reasonable actuary.” 508 U.S. at 635. After all, the Court reasoned, “the methodology” used by 

actuaries “is a subject of technical judgment within a recognized professional discipline”; and so, 

“it would make sense to judge the reasonableness of [the] method” by reference to professional 

standards. Id. But these observations do not answer the objection raised here. There is a 

2The Fund argues that an interim PBGC rule did adopt this approach. See Special Financial Assistance by 

PBGC, 86 Fed. Reg. 36598-01, 36611 (July 12, 2021). But the interim rule has no effect here. The rule implements 

the American Rescue Plan Act of 2021, Pub. L. No. 117-2, 135 Stat 4 (2021), which created a special financial 

assistance fund for multiemployer funds in critical or declining status. See 29 U.S.C. § 1432. The Act explicitly 

authorized the PBGC to impose conditions on calculating withdrawal liability for employers leaving funds that had 

accepted this assistance. See id. § 1432(m)(1). Neither party argues that this provision applies to Sofco. And the 

mere fact that the agency said that it was “reasonable” to use “mass withdrawal interest assumptions for purposes of 

calculating withdrawal liability” in the context of funds covered by that Act, does not mean that using such 

assumptions is always “reasonable.” Even if it were, § 1393(a)(1)—the statutory provision at issue here—requires 

more than that the actuary’s assumptions be “reasonable” in an abstract sense; they must also “offer the actuary’s 

best estimate of anticipated experience under the plan.” We presume that the PBGC may displace § 1393(a)(1)’s 

requirements by regulation. But there is no reasonable argument that it has done so here.
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difference between the “technical judgment” a reasonable actuary might use to decide how to 

estimate something and the policy choice about what to estimate. A fund’s determination is not 

insulated from review when an actuary uses otherwise reasonable assumptions to estimate the 

wrong thing. ERISA, not the Actuarial Standards of Practice, tells the actuary what to project. 

We hold that using the Segal Blend here violates ERISA’s mandate that the interest rate 

for withdrawal liability calculations be based on the “anticipated experience under the plan.” 

29 U.S.C. § 1393(a)(1). The district court did not err.

IV. Partial-Withdrawal Liability

Sofco challenges the Fund’s assessment of partial-withdrawal liability. A constructionindustry employer is liable for a partial withdrawal when its contributions decline to an 

“insubstantial portion of its work in the craft and area jurisdiction of the collective bargaining 

agreement of the type for which contributions are required.” 29 U.S.C. § 1388(d)(1). The Fund

determined that Sofco had partially withdrawn from the fund in 2011, 2012, and 2013 because 

Sofco’s contributions had fallen by more than 70% in those years. Sofco challenged this 

assessment, arguing that a construction employer’s contributions become “insubstantial” only 

when the employer has come close to ceasing contributions altogether. Drawing on a definition 

of “insubstantial” found in an IRS publication, Sofco suggested that the proper benchmark would 

be a 98% decline (or a 2% contribution level) compared to prior years. The arbitrator upheld the 

actuary’s assessment, finding that “[n]one of the figures on which the Fund based its 

determination . . . exceed what [he found] to be the ‘insubstantial’ threshold appropriate to the 

circumstances of this case.” The district court then upheld the arbitrator’s determination, largely 

because “the lack of clear guidelines on this issue” meant that Sofco could not prove “that the 

Fund’s determination was unreasonable or clearly erroneous.” For the reasons that follow, we 

vacate the district court’s decision on this point and remand for further proceedings. 
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A. Partial-Withdrawal Liability, Generally

The MPPAA sets out a complicated formula for how to determine whether a partial 

withdrawal has occurred. See 29 U.S.C. § 1385. Generally, an employer is liable for a partial 

withdrawal in a plan year if “there is a 70[%] contribution decline.” Id. § 1385(a)(1). But the

decline is not measured by looking only at the single year in which it is assessed; an actuary 

considers that year and the two preceding years, looking for a sustained 70% contribution decline 

for three years straight. Id. § 1385(b)(1)(B)(i). This is called the “3-year testing period.” Id. 

Contributions in these years must, of course, be assessed against some sort of baseline. 

The baseline is the average of the two years with the highest contributions in the five-year period 

preceding the three-year testing period. Id. § 1385(b)(1)(B)(ii). This is called the “high base 

year.” Id. Finally, the contributions for that year are measured in “contribution base units”—the 

units for which an employer must contribute. Id. § 1301(a)(11). Here, the unit is hours because 

Sofco was required to contribute to the fund a certain amount per hour worked under the CBA. 

If in each year of the three-year testing period the contributions in that year “do not exceed 

30[%]” of the contributions for the high base year, a partial withdrawal is assessed in the third 

year. Id. § 1385(b)(1)(A). 

Here is a simple example. Let’s say we are trying to determine whether an employer is 

liable for a partial withdrawal in 2012. We would look at the employer’s annual contributions in 

2012, 2011, and 2010. This is the numerator of our ratio. To determine the high base year, or 

the denominator in our ratio, we look at annual contributions in 2009, 2008, 2007, 2006, and 

2005. We take the two years in which contributions were the highest and average them. Then, 

for each of the years 2012, 2011, and 2010, we divide the contributions in those years by the 

high base year. If for three straight years—in 2012, 2011, and 2010—that ratio does not exceed 

30%, there has been a partial withdrawal. If in any of those years the ratio does exceed 30%, no 

partial withdrawal liability is assessed, even if the ratio in the other two years is below 30%. So 

in the example below, the denominator (or contributions in the high base year) would be 100,

because that is the average of 90 and 110. We would then divide 30, 28, and 30—the 

contributions in 2010, 2011, and 2012—by 100. This gives us ratios of 30%, 28%, and 30%. 

Because none of those figures exceed 30%, a partial withdrawal would be assessed. 
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B. “Insubstantial Portion”

Slightly different rules govern the construction industry. Per an exception in the 

MPPAA, a construction-industry employer “is liable for a partial withdrawal only if the 

employer’s obligation to contribute under the plan is continued for no more than an insubstantial 

portion of its work in the craft and area jurisdiction of the collective bargaining agreement of the 

type for which contributions are required.” 29 U.S.C. § 1388(d)(1). The parties, the arbitrator 

and the district court all read this provision to mean that although a regular employer would be 

assessed partial-withdrawal liability if its contributions in the three-year testing period “d[id] not 

exceed 30[%],” id. § 1385(b)(1)(A), a construction employer should be assessed partialwithdrawal liability if its contributions amounted to “an insubstantial portion,” id. § 1388(d)(1), 

of what it contributed in the high base year.3

3The Fund calculated Sofco’s absolute decline in contributions. That methodology would certainly apply if 

Sofco were not a construction industry employer. See 29 U.S.C. § 1385(b)(1) (generally applicable criteria); id.

§ 1388(d)(1) (criteria applicable to construction-industry employers). But ERISA specifies that a constructionindustry employer is liable for a partial withdrawal only if its contributions are “an insubstantial portion of its work 
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No court has defined “an insubstantial portion” as used in this provision. And the PBGC 

has expressly declined to opine on the meaning of this statutory term, concluding instead that 

“such fact-specific determinations are the responsibility of the plan sponsor.” PBGC Opinion 

Letter 95-2, 1995 WL 912004, at *2 (Aug. 18, 1995). The Fund echoes the PBGC, arguing that 

“what constitutes an insubstantial portion [should be] left to the discretion of the Fund.” But 

neither the PBGC nor the Fund offers any hint as to what “fact-specific” considerations 

might generally go into deducing whether a “portion” is “insubstantial”; and the Fund offered no 

fact- or context-specific reason why it deemed Sofco’s contributions to be “insubstantial” in this 

case. As best we can tell, the Fund simply determined that the amounts Sofco had contributed 

(ranging from 4%–18% of its prior contributions) were less than the 30% that, by statute, would 

have made a non-construction employer liable. See 29 U.S.C. § 1385(b)(1)(A). Based on this 

calculation, it sent Sofco a bill.4

The arbitrator upheld the Fund’s assessment of withdrawal liability. He thought that the 

“area of ‘insubstantial’ must lie between [§ 1385(b)(1)(A)]’s 30% figure [for non-construction 

employers] and [a] 5% figure that Congress declined to adopt.”5 But the arbitrator declined to 

in the craft and area jurisdiction . . . for which contributions are required.” Id. § 1388(d)(1) (emphasis added). And 

the PBGC has suggested that “insubstantial portion” refers to a “percentage of work.” PBGC Opinion Letter 95-2, 

1995 WL 912004, at *2. So while the Fund calculated Sofco’s contributions as if the “high base year” were the 

appropriate denominator, we are not sure whether that is correct; the statutory language suggests that the proper 

denominator is not past contributions, but the amount of work being done in the area for which contributions are 

required. See id. We take no position on this question, however. No party has advanced this reading of the statute; 

Sofco did not challenge the calculations on this basis; and the data on which the actuary performed his calculations 

is not broken out that way in any event. Accordingly, we assume the Fund’s calculation method is right for the 

purposes of this litigation. 

4The actuary acknowledged that he assessed partial withdrawal liability according to the 70/30 formula 

applicable to non-construction-industry employers. See 29 U.S.C. § 1385(a)(1). In his letter to the Fund, he stated 

that he “assume[d] that [Sofco] [would] be assessed partial withdrawal liability for each partial withdrawal,” but 

would “defer to Fund Counsel’s interpretation as to whether partial withdrawal liability is assessable to this 

employer.” Fund counsel then determined Sofco was liable for partial withdrawals because there was “more than a 

70% reduction in contribution hours reported.” The Fund now defends its liability assessment by saying that “what 

constitutes an insubstantial portion is left to the determination of the Fund.”

5Both parties, and the arbitrator, reference a suggestion from construction-industry employers to the House 

Ways and Means Committee to define “insubstantial” as 5%. See Multiemployer Pension Plan Amendments Act of 

1979; Hearing on H.R. 3904 Before the H. Comm. on Ways and Means, 96th Cong. 126–32 (1980) (statement of 

John Prager, Counsel, Associated Builders and Contractors, Inc.). Sofco suggests that Congress did not adopt this 

figure because it was too high; the Fund suggested to the arbitrator that Congress did not adopt it because it was too 

low. We give the 5% figure no weight. “[U]nenacted approvals, beliefs, and desires are not laws.” P.R. Dep’t of 

Consumer Affairs v. Isla Petroleum Corp., 485 U.S. 495, 501 (1988).
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specify that percentage, or even a narrower range; instead, he simply concluded that “[n]one of 

the figures on which the Fund based its determination . . . exceed what [he found] to be the 

‘insubstantial’ threshold appropriate to the circumstances of this case.” Just what those 

circumstances might have been, we are left to wonder.

The district court was similarly stumped. It appeared to agree with Sofco that 

“‘insubstantial portion’ must mean something.” Sofco, 2020 WL 2541970, at *11. But given 

“the lack of clear guidelines on” what constitutes an “insubstantial portion,” the district court fell 

back on § 1401(a)(3)(A)’s “presumption in favor of the Fund’s determination.” Id. Because 

Sofco had failed to “establish that the Fund’s determination was unreasonable or clearly 

erroneous,” the district court upheld the Fund’s determination. Id. 

The district court’s reliance on the § 1401(a)(3)(A) presumption was error. The Supreme 

Court in Concrete Pipe gave every indication that this presumption applies only to questions of 

fact. See 508 U.S. at 621, 630. We have suggested as much too, Sherwin-Williams, 158 F.3d at 

392, as has at least one of our sister circuits, see Joseph Schlitz Brewing Co. v. Milwaukee 

Brewery Workers’ Pension Plan, 3 F.3d 994, 1000 (7th Cir. 1993) (“Concrete Pipe

. . . understood this language to mean that in the proceeding before the arbitrator the employer 

must ‘disprove a [plan sponsor’s] challenged factual determination by a preponderance’ of the 

evidence.” (second alteration in original)). And we are not sure how it could be otherwise; one 

cannot disprove a legal determination “by a preponderance of the evidence.” 29 U.S.C. 

§ 1401(a)(3)(A). Here, the factual determinations include the percentages Sofco contributed in 

the relevant years compared to the baseline. Those percentages (4% to 18%) are not in dispute. 

“[I]nsubstantial portion,” by contrast, is a statutory term; discerning its meaning presents a 

question of law. Safelite Grp., 930 F.3d at 433. And whether particular percentages fall within 

the definition of an “insubstantial portion” is also a legal question, or a mixed question of law 

and fact. See Concrete Pipe, 508 U.S. at 630 (explaining that the § 1401(a)(3)(A) presumption 

does not apply to a plan’s determination of the date of “complete withdrawal”; the presumption 

applies to the historical facts, but “the question whether these facts amount to a ‘complete 

withdrawal’” within the meaning of ERISA “is one of law”). 
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Because the district court erred by relying on the § 1401(a)(3)(A) presumption to uphold 

the Fund’s determination, we vacate the district court’s decision on this issue and remand for the 

court to consider the legal question in the first instance. We proceed this way, in part, because 

the PBGC has indicated that what counts as an “insubstantial” contribution might be “factspecific,” PBGC Opinion Letter 95-2, 1995 WL 912004, at *2, and the arbitrator also suggested 

that the “‘insubstantial’ threshold” might vary with “circumstances.” Perhaps that is so. But if 

there is some reason why context could matter, no one has explained it to us; nor has anyone 

indicated what factors a decisionmaker should look for or how to weigh them. By contrast, 

Sofco seems to suggest that an “insubstantial portion” must be a fixed percentage.6 We take no 

position on this question here. But to the extent that facts may inform the legal standard to be 

applied, this question is best explored in another forum. 

We note another wrinkle, however. In addition to relying on the § 1401(a)(3)(A) 

presumption, the Fund also invokes a purported delegation of regulatory or interpretive authority. 

The Fund claims that “both Congress and the PBGC” have delegated to the individual pension 

funds the “statutory discretion” to decide whether a construction employer’s contributions have 

satisfied the (otherwise undefined) “‘insubstantial portion’ standard.” The Fund locates this 

authority in a PBGC Opinion Letter. 

When asked for an opinion defining “insubstantial portion,” the PBGC noted that many 

sections of ERISA “contain specific numerical thresholds and tests governing withdrawal 

liability determinations.” PBGC Opinion Letter 95-2, 1995 WL 912004, at *2. By contrast, the 

agency noted that Congress had not “specif[ied] a comparable numerical test” governing 

“whether any given percentage of work constitutes an ‘insubstantial portion’” for construction6Sofco suggests 2%, drawing that definition from an IRS circular defining that term as used in a tax statute. 

IRS Pub. 1771, 2012 WL 8144694 (Jan. 1, 2012). But Sofco does not explain why a different agency’s definition, 

interpreting “insubstantial” as used in a different statute, is the appropriate measure for this one. The Fund, for its 

part, offers little by way of statutory construction. It answers Sofco’s definition by drawing a contrast to the 

entertainment industry, for whom Congress eliminated partial-withdrawal liability altogether. See 29 U.S.C. 

§ 1388(d)(2). The Fund asserts that 2% is too low because that percentage would effectively eradicate withdrawal 

liability in the construction industry; but it does not explain why this is so. And, critically, it does not offer an 

alternative percentage or otherwise suggest what the correct interpretation of “insubstantial portion” might be. 

Instead, the Fund falls back on its claim to deference, asserting that its determination of Sofco’s withdrawal liability 

must be upheld because its determination was “reasonable.” But why it was “reasonable” or how we should judge 

that question, it does not explain. 
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industry withdrawal liability. Id. But rather than reading this lack of specificity as a delegation 

to the agency to deploy its regulatory expertise and “fill [the] gap left . . . by Congress,” see 

Chevron, U.S.A., Inc. v. Nat. Res. Def. Council, 467 U.S. 837, 843 (1984), the PBGC read 

Congress’s silence as a delegation “to the plan sponsor[s]” themselves to make these “factspecific determinations.” PBGC Opinion Letter 95-2, 1995 WL 912004, at *2. These 

determinations would, presumably, be made by individual plan sponsors, on a case-by-case 

basis, and the agency provided no standards to guide the funds’ decisionmaking. We question 

whether the PBGC, or even Congress, could delegate such discretion. 

“[A]gency ‘subdelegations [of statutory powers] to outside parties are assumed to be 

improper absent an affirmative showing of congressional authorization.’” Nat’l Truck Equip. 

Ass’n v. Nat’l Highway Traffic Safety Admin., 711 F.3d 662, 675 (6th Cir. 2013) (second 

alteration in original) (quoting U.S. Telecom Ass’n v. FCC, 359 F.3d 554, 565 (D.C. Cir. 2004)); 

see also Fund for Animals v. Kempthorne, 538 F.3d 124, 132 (2d Cir. 2008); La. Forestry Ass’n, 

Inc. v. Sec’y U.S. Dep’t of Labor, 745 F.3d 653, 671 (3d Cir. 2014). Here, the PBGC read 

congressional silence as authority to delegate the definition of “insubstantial portion” to a private 

(and interested) party, and provided no guideposts, that we can discern, to channel the funds’ 

discretion. There is, at a minimum, reason to question whether the PBGC was right to say that 

the meaning of “insubstantial portion” can be for each plan sponsor to decide for itself. See

PBGC Opinion Letter 95-2, 1995 WL 912004, at *2. 

Ordinarily, we might have asked the parties for supplemental briefing on this question. 

“[A] court may consider an issue ‘antecedent to . . . and ultimately dispositive of’ the dispute 

before it, even an issue the parties fail to identify and brief.” U.S. Nat’l Bank of Or. v. Indep. Ins. 

Agents of Am., Inc., 508 U.S. 439, 447 (1993) (second alteration in original) (quoting Arcadia v. 

Ohio Power Co., 498 U.S. 73, 77 (1990)). And here, the parties do arguably attempt to address 

the issue. Though not quite framing it as a delegation question, Sofco argues that “[t]he statute 

cannot give the Fund this level of discretion and be constitutional,” and that the Fund cannot be 

given “responsibility for legal determinations, such as the interpretation of a federal statute.” 

The Fund, meanwhile, insists that “what constitutes an insubstantial portion is left to the 

discretion of the Fund,” relying on “statutory discretion” granted to it by Congress and the 
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PBGC. Because we vacate the district court opinion on this issue in any event, the parties may 

brief this question in the district court on remand.7

Accordingly, we vacate the district court’s decision upholding the Fund’s assessment of 

partial-withdrawal liability and remand for further proceedings on this question. 

V. Liability for Forklift and Shop Work

We now consider the parties’ challenges to whether forklift work and shop work should 

be included in the withdrawal-liability calculation. It was Sofco’s practice to assign forklift 

work to the Ironworkers. But Sofco would also occasionally assign forklift work to Local 18 

members: sometimes because there were not enough Ironworkers, sometimes to keep the Local 

18 members on its payroll between crane operation projects, and sometimes to settle minor 

grievances. Local 18 insisted that forklift work was within its jurisdiction. Sofco, meanwhile, 

insisted that forklift work belonged to the Ironworkers. 

Sofco also employs individuals to do shop work. Sofco has assigned shop work to 

members of other unions, non-union individuals, and sometimes to Local 18 members. In 

particular, Sofco assigned shop work to Jon Allen, who belonged to Local 18. After Jon retired, 

Sofco assigned shop work to his son, Jason Allen. Jason used to be a Local 18 member but has 

since withdrawn and joined the Laborers union. Sofco made contributions to the Local 18 plan 

for the shop work that Jon and Jason did but says it did so voluntarily. Local 18 never claimed 

that shop work was within its jurisdiction before this dispute. 

The Fund assessed complete-withdrawal liability against Sofco for both forklift work and 

shop work, and the arbitrator upheld that determination. The district court affirmed with regard 

to the forklift work but overturned the assessment for shop work. Sofco, 2020 WL 2541970, at 

*7–8.

7We imagine that input from the PBGC, the agency tasked with administering this portion of the statute, 

see 29 U.S.C. § 1302, would also assist the district court. 
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A construction employer is liable for a complete withdrawal from a pension plan if it 

“ceases to have an obligation to contribute under the plan” but “continues to perform work in the 

jurisdiction of the collective bargaining agreement of the type for which contributions were 

previously required.” 29 U.S.C. § 1383(b)(2). When Sofco terminated its CBA with Local 18 as 

of April 30, 2017, it ceased to have an obligation to contribute under the plan. And Sofco 

continues to perform both forklift work and shop work. So whether the Fund properly included 

forklift work and shop work in its withdrawal-liability calculation depends on whether (1) this 

work was in the jurisdiction of the CBA, and (2) contributions to the fund were required for this 

work. Id. § 1383(b)(2)(B)(i). 

“Jurisdiction” over work is determined by the “jurisdictional provisions of the relevant 

collective bargaining agreement,” Stevens Eng’rs & Constructors, Inc. v. Loc. 17 Iron Workers 

Pension Fund, 877 F.3d 663, 670 (6th Cir. 2017), and an “obligation to contribute” arises under 

a CBA, 29 U.S.C. § 1392(a). “We interpret collective-bargaining agreements, including those 

establishing ERISA plans, according to ordinary principles of contract law, at least when those 

principles are not inconsistent with federal labor policy.” M & G Polymers USA, LLC v. Tackett, 

574 U.S. 427, 435 (2015). “Where the words of a contract in writing are clear and unambiguous, 

its meaning is to be ascertained in accordance with its plainly expressed intent.” Id. (quoting 

11 R. Lord, Williston on Contracts § 30:6, (4th ed. 2012)). Contract interpretation is a question 

of law that we review de novo. First Am. Nat’l Bank v. Fid. & Deposit Co. of Md., 5 F.3d 982, 

984 (6th Cir. 1993). We presume that the arbitrator’s findings of fact are correct unless rebutted 

by a preponderance of the evidence. See 29 U.S.C. § 1401(c). 

Forklift Work. The arbitrator included forklift work in the withdrawal-liability 

calculation, and the district court upheld that decision. Sofco, 2020 WL 2541970, at *6–7. On 

appeal, Sofco argues that the district court erred because it never had an obligation to contribute 

to the plan for forklift work. Alternatively, it argues that even if contributions were required at 

some point, Local 18 forfeited its right to that work by not properly challenging the Ironworkers’ 

jurisdiction.
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Sofco’s CBA with Local 18 clearly establishes jurisdiction over forklift work. The 

“Jurisdiction of Work” section of the most recent agreement lays out the work for which Sofco 

“shall employ” Local 18 members. It states: “It is further understood that all equipment for 

which classifications and wages have been established in this Agreement . . . shall be manned, 

when operated on the job site, by a member of the International Union of Operating Engineers.” 

The agreement goes on to establish classifications and wages for forklifts no fewer than fourteen 

times. Thus, under the CBA, forklift work was in Local 18’s jurisdiction. 

The CBA also required contributions to the pension plan for forklift work. The 

agreement specifies that “[f]ringe benefit contributions shall be paid . . . for all hours paid to each 

employee by the Employer under this Agreement.” It then lists Pension Fund immediately 

below. A later portion of the agreement, setting out job classifications and wages, lists specific 

contribution amounts corresponding to each classification, including forklift work. As a result, 

Sofco was required to contribute to the Fund for forklift work performed by Local 18 members. 

Sofco argues that forklift work belongs to the Ironworkers and that Local 18 forfeited any 

claim to that work by not challenging the Ironworkers’ jurisdiction. It relies on our decision in 

Stevens Engineers & Constructors, Inc. v. Local 17 Iron Workers Pension Fund, 877 F.3d 663 

(6th Cir. 2017), for the proposition that “where two unions both claim certain work and a union 

fails to submit its jurisdictional challenge to secure a determination as to which union the work 

belongs to, the union abandons its claim to the work.” Stevens is inapposite. 

The CBA in Stevens included a qualifier stating that the agreement’s jurisdiction was 

subject to national agreements “covering work jurisdiction and [the] allocation and division of 

work.” Id. at 667 (alteration in original). The union was party to a national agreement providing 

“that, where multiple unions can claim the same work, employers must conduct a pre-job 

conference to assign work on a project.” Id. at 668. By the terms of the agreement, a union 

failing to challenge the resulting assignment of work through the agreement’s dispute resolution 

process, forfeited jurisdiction over that work. Id. at 667–68. The union in Stevens did not 

challenge the assignment of work to another union and, thus, forfeited its jurisdiction over it. Id.
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at 668. Consequently, Stevens was not performing work in the jurisdiction of the CBA and did 

not owe withdrawal liability. Id. at 669–70. 

Here, the Local 18 CBA contains a provision covering jurisdiction of work assigned 

during pre-job conferences similar to that in Stevens. But critically, no such conference occurred 

here, nor has Sofco suggested that any other outside agreement applies. Stevens does not govern.

Alternatively, Sofco argues that it had a practice of assigning forklift work to the 

Ironworkers and that Local 18 implicitly ceded its claim to forklift work by failing to challenge 

the work Sofco assigned to the Ironworkers. That argument is unavailing. We have held that 

because multiemployer plans “may rely on the literal terms of written agreements between the 

employer and the union, any oral understandings or practices between the contracting parties are 

immaterial.” Operating Eng’rs Loc. 324 Health Care Plan v. G&W Constr. Co., 783 F.3d 1045, 

1051 (6th Cir. 2015) (internal quotations and citations omitted). A fund has the right to collect, 

and an employer has an obligation to contribute, payments due as established by the written 

provisions of the agreement. See id. at 1053. Extrinsic evidence, such as the union’s conduct, 

does not void the clear terms of the contract. See id.; Stevens, 877 F.3d at 672. 

Here, the CBA clearly establishes Local 18’s jurisdiction over forklift work and Sofco’s 

obligations to contribute to the fund for that work. The district court did not err by concluding 

that the Fund properly included forklift work in the withdrawal liability calculation. 

Shop Work. The arbitrator found that Jon and Jason Allen “perform[ed] maintenance and 

repair work,” that this work was “shop work,” and that Sofco had an obligation to contribute to 

the Fund for this work. He added that, in his view and despite Sofco’s arguments to the contrary, 

Sofco could not have voluntarily contributed to the Fund without running afoul of the Labor 

Management Relations Act (LMRA). The district court overturned the arbitrator’s decision. 

Sofco, 2020 WL 2541970, at *8. It noted that the arbitrator had failed to cite any specific portion 

of the CBA that covered “shop work,” and concluded on that basis that shop work was not within 

the jurisdiction of the agreement. Id. This was error. 

First, Sofco failed to carry its burden of rebutting the arbitrator’s findings of fact. We are 

to presume that the arbitrator’s findings of fact are correct unless the challenging party disproves 
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those findings by a preponderance of the evidence. 29 U.S.C. § 1401(c). The arbitrator found 

that what the parties refer to as “shop work” is maintenance and repair work. Not only has Sofco 

failed to produce any evidence disproving this finding, but Sofco’s own witnesses defined “shop 

work” as including maintenance and repair work. The arbitrator also determined that Jon and 

Jason Allen performed maintenance and repair work. Sofco does not challenge this finding 

either. 

Second, the arbitrator correctly determined that the CBA covers maintenance and repair 

work. As the Fund pointed out, the agreement’s “Jurisdiction of Work” section states that “the 

Employer shall employ Operating Engineers for . . . maintenance and repair [work].” The 

agreement then requires payments to the pension fund “for all hours paid to employees who 

perform any covered work.” Thus, maintenance and repair work is in the jurisdiction of the 

CBA and the agreement requires contributions to the fund for this work. Id. § 1383(b)(2)(B)(i). 

And because these contributions were required, the parties’ dispute over whether Sofco could 

have made such contributions voluntarily is beside the point. The district court erred in vacating 

the arbitrator’s determination that Sofco is liable for shop work. 

VI. Successor Liability

Next, Sofco challenges the Fund’s inclusion of its predecessor’s contribution history in 

its withdrawal liability calculation. Sofco argues that this was error because when Sofco 

purchased Old Sofco’s assets in an arm’s-length transaction in 2004, it became a new, 

independent entity and did not assume any of Old Sofco’s liabilities. 

The arbitrator determined that including Old Sofco’s contribution history was appropriate 

because “‘new’ Sofco is clearly ‘old’ Sofco’s successor employer with respect to its collective 

bargaining and employee benefit obligations.” He noted that both companies operated under the 

same name (Sofco Erectors, Inc.); contributed to the fund using the same employer code number; 

used the same equipment, assets, management, and personnel; and had overlapping ownership. 

The district court upheld the arbitrator’s decision.

Successor liability is an equitable doctrine, the application of which we review for an 

abuse of discretion. Tsareff v. ManWeb Servs., 794 F.3d 841, 848 (7th Cir. 2015); see PBGC v. 
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Findlay Indus., Inc., 902 F.3d 597, 611 (6th Cir. 2018). “A district court abuses its discretion 

when it relies on clearly erroneous findings of fact, improperly applies the law, or uses an 

incorrect legal standard.” Robertson v. Simpson, 624 F.3d 781, 784 (6th Cir. 2010). 

Sofco gets the legal rule right. “[T]he universally-accepted general rule [is] that a 

corporation that purchases the assets of another corporation does not, simply by virtue of the 

asset purchase transaction, become liable for the obligations of the seller.” City Mgmt. Corp. v. 

U.S. Chem. Co., 43 F.3d 244, 251 (6th Cir. 1994); see also Chi. Truck Drivers, Helpers & 

Warehouse Workers Union (Indep.) Pension Fund v. Tasemkin, Inc., 59 F.3d 48, 49 (7th Cir. 

1995); CenTra, Inc. v. Cent. States, Se. & Sw. Areas Pension Fund, 578 F.3d 592, 601 (7th Cir. 

2009) (“[A]n asset sale generally results in a complete withdrawal if the seller’s controlled group 

no longer has covered operations or an obligation to contribute. By the same token, the buyer 

generally does not inherit the contribution history.”) (quoting Jayne E. Zanglein & Susan J. 

Stabile, ERISA Litigation 1474, 1476 (3d ed. 2008)). But our court has recognized successor 

liability, as an equitable doctrine, as an exception to the rule. See Findlay, 902 F.3d at 609; see 

also Tasemkin, 59 F.3d at 49. Successor liability is appropriate where “(1) the successor had 

notice of the claim before the acquisition; and (2) there was substantial continuity in the 

operation of the business before and after the sale.” Tsareff, 794 F.3d at 845 (quoting Tasemkin, 

59 F.3d at 49).

The district court did not abuse its discretion in applying this doctrine. First, it noted that 

Sofco had knowledge of the claim before the sale because “all of its officers had worked for the 

company for decades, during which Sofco contributed to the Fund and was a party to the Local 

18 CBA.” Sofco, 2020 WL 2541970, at *10. Second, it concluded that there was “substantial 

continuity in the operation of the business before and after the sale,” Tsareff, 794 F.3d at 845 

(quotation omitted), because “Sofco used the same employer code, used the same equipment, 

assets, and personnel, and had nearly identical management and overlapping ownership,” Sofco, 

2020 WL 2541970, at *10. 

Sofco has not shown that the district court “relie[d] on clearly erroneous findings of fact, 

improperly applie[d] the law, or use[d] an incorrect legal standard.” Robertson, 624 F.3d at 784. 
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Sofco’s only argument on appeal is that because the sale of Old Sofco was not structured under 

29 U.S.C. § 1384, Sofco cannot be responsible for Old Sofco’s contribution history. But Sofco 

misunderstands the purpose of § 1384, which sets out a list of conditions that will relieve a seller 

of withdrawal liability following a “bona fide, arm’s-length sale of assets to an unrelated party.” 

Id. § 1384(a)(1). These conditions include the seller and purchaser having “substantially the 

same” obligations to the plan, id. § 1384(a)(1)(A); the purchaser providing a surety bond, id.

§ 1384(a)(1)(B); and the seller agreeing to be secondarily liable if the purchaser withdraws from 

the plan within five years after the sale, id. § 1384(a)(1)(C). This provision simply states what is 

necessary for a seller to be relieved of withdrawal liability after a sale. See id. § 1384(a). It does 

not say that this is the only circumstance in which a buyer will be subject to successor liability. 

We affirm the district court on this issue.

VII. Attorney’s Fees

Finally, both parties request attorney’s fees. ERISA permits a court to award “all or a 

portion of the costs and expenses incurred . . . , including reasonable attorney’s fees, to the 

prevailing party.” 29 U.S.C. § 1451(e). The district court declined to award attorney’s fees to 

either party because “[t]his case presented very close arguments on complicated legal 

matters . . . and both parties have prevailed on issues.” Sofco, 2020 WL 2541970, at *11–12. 

“We review a district court’s denial of a request for attorney fees to a prevailing claimant under 

ERISA for an abuse of discretion.” Moon v. Unum Provident Corp., 461 F.3d 639, 642 (6th Cir. 

2006) (per curiam). A district court abuses its discretion when we are left with “a definite and 

firm conviction that the trial court committed a clear error of judgment.” Id. (internal quotations 

omitted). 

In our circuit, a district court considers the following factors in determining whether to 

award discretionary attorney’s fees to a prevailing party under ERISA: “(1) The degree of the 

opposing party’s culpability or bad faith; (2) The ability of the opposing party to satisfy an award 

of attorney’s fees; (3) Whether an award of fees against the opposing party would deter others 

from acting in similar circumstances; (4) Whether the party requesting fees sought to benefit all 

participants and beneficiaries of a multiemployer plan or to resolve a significant legal question; 
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and (5) The relative merits of the parties’ position.” Cent. States, Se. & Sw. Areas Pension Fund 

v. 888 Corp., 813 F.2d 760, 767 (6th Cir. 1987). 

As the district court noted, this case involved complicated legal questions without clear 

answers. Each party prevailed on some issues. There is no evidence of bad faith from either 

party. Sofco was fully justified in exercising its right to challenge the Fund’s withdrawalliability determination, as was the Fund in defending it. And neither parties’ positions were 

frivolous. We cannot say that the district court abused its discretion in denying fees under 

§ 1451(e). 

The Fund now invokes other statutory provisions, arguing that we are required to award it 

attorney’s fees under 29 U.S.C. § 1451(b) and 29 U.S.C. § 1132(g)(2)(D). But the Fund failed to 

present this mandatory-fee argument to the district court, instead claiming that the court should 

award discretionary attorney’s fees under § 1451(e). The Fund made no effort to cite the 

authority it believed mandated attorney’s fees; did not develop its mandatory fee argument in its 

briefs to the district court, despite filing a counterclaim for attorney’s fees; and, whether or not it 

believed it had presented a mandatory fee argument to the district court, it did not file a postjudgment motion once the district court ruled without mentioning mandatory fees. The Fund has 

thus forfeited any right to have us address it on appeal. Vance v. Wade, 546 F.3d 774, 781 (6th 

Cir. 2008). 

Even if we were to excuse the forfeiture, the Fund’s argument lacks merit. Attorney’s 

fees under 29 U.S.C. § 1132(g)(2)(D) are mandatory “[i]n any action . . . on behalf of a plan to 

enforce section 1145 [delinquent contributions].” But the Fund does not suggest that Sofco 

failed to timely contribute to the fund, and this case is not an enforcement action under 29 U.S.C. 

§ 1145. So this provision does not apply. Nor does the Fund contest that Sofco timely made 

quarterly withdrawal liability payments before paying its balance in full. Thus, 29 U.S.C. 

§ 1451(b), which grants mandatory attorney’s fees for actions that “compel an employer to pay 

withdrawal liability,” does not apply either. Even the cases the Fund cites recognize that 

mandatory fees do not apply here. See, e.g., United Retail & Wholesale Emps. Teamsters Union 

Loc. No. 115 Pension Plan v. Yahn & Mc Donnell, Inc., 787 F.2d 128, 134–35 (3d Cir. 1986) 
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(“[I]n any action . . . other than an action to recover a delinquent payment, an award of attorney’s 

fees and costs is discretionary.”). 

* * *

For the foregoing reasons, we AFFIRM in part, REVERSE in part, VACATE in part, and 

REMAND to the district court for further proceedings consistent with this opinion.
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______________________________________________________

CONCURRING IN PART AND DISSENTING IN PART

______________________________________________________

GRIFFIN, Circuit Judge, concurring in part and dissenting in part. 

I join Judge Larsen’s opinion in this ERISA dispute, except for Section IV. Although 

I agree with the majority that the district court erred when it relied on 29 U.S.C. 

§ 1401(a)(3)(A)’s presumption in favor of the Fund’s determination regarding partial-withdrawal 

liability, I would hold that the Fund wrongly assessed partial-withdrawal liability in the first 

instance. I therefore would reverse the district court’s ruling to the contrary and remand with 

instructions to vacate the arbitrator’s confirmation of that assessment. Accordingly, 

I respectfully concur in part and dissent in part.

As the majority opinion explains, ERISA provides for partial-withdrawal liability when a 

construction-industry employer’s contributions decline to an “insubstantial portion of its work in 

the craft and area jurisdiction of the collective bargaining agreement of the type for which 

contributions are required.” § 1388(d)(1). As did the district court, see Sofco Erectors, Inc. v. 

Trs. of the Ohio Operating Eng’rs Pension Fund, 2020 WL 2541970, at *10–11 (S.D. Ohio May 

19, 2020), the majority acknowledges what constitutes an “insubstantial portion” is not defined. 

But, instead of remanding to the district court without providing any guidance, I would employ 

our standard and familiar tools of statutory construction to resolve this issue. 

Because Congress did not define “insubstantial,” we should fill in the gap to make 

§ 1388(d)(1) “work.” Continental Can Co. v. Chicago Truck Drivers, Helpers & Warehouse 

Workers Union (Indep.) Pension Fund, 916 F.2d 1154, 1155 (7th Cir. 1990). That requires 

examining its ordinary meaning. See In re Application to Obtain Discovery for Use in Foreign 

Proc., 939 F.3d 710, 717 (6th Cir. 2019). Dictionaries in use at the time the Multiemployer 

Pension Plan Amendments Act was enacted (1980) provide a good starting place. Id. They 

demonstrate the term refers to a nominal amount: “Insubstantial” is something that is not of 

“considerable value” or “quantity.” See Funk & Wagnalls Standard College Dictionary (1978); 

The American Heritage Dictionary of the English Language (1976); Merriam-Websters New 
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Collegiate Dictionary (1975) (all defining insubstantial as not substantial, and defining 

substantial as something of “considerable value,” “considerable . . . value,” and “considerable [] 

quantity,” respectfully). And more contemporaneous dictionaries, to which we can also turn, see 

In re Application, 939 F.3d at 717, agree. See, e.g., The American Heritage Dictionary of the 

English Language (2020) (defining insubstantial as “very small or negligible, as in importance, 

size or amount”); Webster’s Unabridged Dictionary (2001) (defining insubstantial as “not 

substantial in amount or size; inconsiderable,” and “inconsiderable” as “small, as in value, 

amount, or size”). So too does the caselaw; the Supreme Court has read “insubstantial” as

interchangeable with “de minimis” many times over. See, e.g., Goss v. Lopez, 419 U.S. 565, 576 

(1975); Fortner Enters. v. U.S. Steel Corp., 394 U.S. 495, 501 (1969); Local 761, Int’l Union of 

Elec., Radio & Mach. Workers, AFL-CIO v. N. L. R. B., 366 U.S. 667, 682 (1961); Anderson v. 

Mt. Clemens Pottery Co., 328 U.S. 680, 693 (1946). 

Indeed, there have been several occasions in which courts have placed a single-digit 

value on “insubstantial.” See, for example, Tampa Electric Co. v. Nashville Coal Co., 365 U.S. 

320, 333 (1961), where the Supreme Court commented in an antitrust dispute that control of one 

percent of the market is “quite insubstantial.” We too have suggested that insubstantial means 

“something less than 5%.” Seasongood v. C.I.R., 227 F.2d 907, 912 (6th Cir. 1955) (examining 

26 U.S.C. § 501(c)(3)’s restriction on tax-exempt organizations from using a “substantial part of 

activities . . . to influence legislation”); see also Himmel v. C.I.R., 338 F.2d 815, 820 (6th Cir. 

1964) (“[A] difference of 5% . . . is [not] so insubstantial as to make the redemption[ of 

corporate stock] ‘essentially equivalent to a dividend’” under 26 U.S.C. § 302(b)(1)). And we 

have even done so en banc, noting in a copyright-infringement matter that the use of “as much as 

30 percent of one copyrighted work, and in no case . . . less than 5 percent of the copyrighted 

work as a whole” constituted percentages that were “not insubstantial” for purposes of 17 U.S.C. 

§ 107’s fair-use doctrine. Princeton Univ. Press v. Mich. Document Servs., Inc., 99 F.3d 1381, 

1389 (6th Cir. 1996) (en banc). 

Given this, an “insubstantial portion” in my view can only mean a low-single-figure 

percentage. Sofco’s contributions plainly did not fall under that threshold. During the applicable 

three-year testing periods, Sofco’s contribution ratio spanned from four to eighteen percent. 
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More specifically, the testing periods produced the following ratios for each of the three years at 

issue:

• 2011: 13% (2009); 4% (2010); and 9% (2011);

• 2012: 4% (2010); 9% (2011); and 18% (2012); and

• 2013: 9% (2011); 18% (2012); and 28% (2013).

Save the four-percent calculation (for 2010), I cannot agree that as a matter of law, these ratios 

remotely approach the “insubstantial portion” threshold. 29 U.S.C. § 1388(d)(1). And because 

they do not, the Fund did not cumulatively satisfy the three-year lookback period for the 

calculation of partial withdrawals. § 1385(b). 

For these reasons, the Fund’s assessment of partial-withdrawal liability was erroneous. 

I would therefore reverse the district court’s holding to the contrary and remand with instructions 

to vacate the arbitrator’s confirmation of that assessment. In all other respects, I join the 

majority opinion.