What happened
A D.C. Circuit panel on Tuesday partly unwound a $13 million judgment in favor of the IAM National Pension Fund in a dispute with M&K Truck Centers-related entities, reversing a $1.6 million delinquent-contribution ruling and sending other liability questions back for more proceedings.
Writing for the panel, Judge Gregory Katsas said the fund's theory that ES Summit owed contributions for work performed by employees of ES Northern Illinois "was not adequately pleaded." The court reversed summary judgment for the fund on that claim and directed summary judgment for the defendants on it, while otherwise affirming in part, reversing in part and remanding.
The appeals arose from pension obligations tied to a network of affiliated truck dealerships operating under the M&K Truck Centers trade name. According to the opinion, M&K organized Illinois dealerships through separate sales and employee-services companies, and several employee-services entities signed collective bargaining agreements requiring contributions to the IAM National Pension Fund.
The fund assessed ES Alsip about $6.1 million in withdrawal liability after it stopped contributing at the end of 2018. The district court later entered a $13 million judgment covering principal, interest and liquidated damages, including about $1.6 million tied to ES Summit's alleged failure to contribute for work at the Northern Illinois dealership and about $11.4 million tied to ES Alsip's withdrawal from the fund.
On the delinquent-contribution issue, the D.C. Circuit said the complaint alleged common ownership but did not plead the other factors needed under the NLRB-style single-employer test the parties and district court used, including interrelated operations, common management and centralized control of labor relations. The panel also said the Cook County coverage language in ES Summit's agreement did not solve the threshold problem of whether ES Northern Illinois could be treated as the same employer.
The panel also revived a factual fight over whether Chad and Jodi Boucher, who owned ES Alsip when the withdrawal liability arose, could be personally liable based on a house-flipping operation. The court said a factfinder could reasonably go either way on whether the activity was a trade or business before withdrawal liability was incurred, and it reversed summary judgment for the fund while affirming the denial of the Bouchers' own bid for judgment.
The court rejected a jurisdictional challenge to the fund's successor-liability theories involving Laborforce and Employee Services Inc., reasoning that the fund brought federal ERISA and MPPAA claims in the same case rather than a separate judgment-enforcement action. The case now returns to the district court for further proceedings under the D.C. Circuit's opinion.