The opinion of the court was delivered by: Sweet, District Judge.
Plaintiffs ILGWU National Retirement Fund and two of its
trustees ("the Fund") have moved to file an amended complaint
and for summary judgment on the complaint as amended. Defendant
B.B. Liquidating Corp. ("BBLC") has cross-moved for summary
judgment. For the following reasons, the motion to amend the
complaint is granted and both motions for summary judgment are
The Fund is a New York trust which provides pension benefits
to approximately 130,000 workers in the garment industry. It is
a "pension plan" and a "multiemployer plan" as those terms are
defined in the Employee Retirement Income Security Act (ERISA)
§§ 3(2), 3(37), 29 U.S.C. § 1002(3), 1002(37).
BBLC is a New York corporation which operated under the name
Blassport, Ltd. ("Blassport-BBLC") from the time of its
incorporation in the early 1970's until it sold all of its
assets in 1983. At that time, BBLC apparently changed its name
to B.P.T. Liquidating Corp. ("BPT"), although the Fund alleges
that it currently operates under the name B.B. Liquidating
Corp.*fn1 Norman Zeiler ("Zeiler") is alleged to be a New York
resident who was an officer and principal stockholder of BBLC
at all times pertinent to this action.
Multiemployer pension plans such as the Fund are covered
under ERISA as amended by the Multiemployer Pension Plan
Amendments Act of 1980, 29 U.S.C. § 1381-1405 (1980) ("MPPAA").
Under these amendments, an employer who ceases making
contributions to a multiemployer plan becomes liable for at
least a portion of the amount of the plan's "unfunded vested
benefits." 29 U.S.C. § 1381. It is the responsibility of the
plan sponsor to notify the employer of the amount of its
withdrawal liability and to make arrangements to collect that
liability. § 1382. This notification is to be made "as soon as
practicable" after the employer stops contributing. § 1399(b).
Section 1401(a) requires that disputes between an employer
and a plan sponsor concerning the amount of the employer's
withdrawal liability be resolved through arbitration. Such
arbitration must be initiated within 60 days of the date of the
sponsor's notification to the employer of the withdrawal
liability except in certain instances not relevant to this
case. Notwithstanding the timely initiation of arbitration, the
employer is required to make all payments requested by the
sponsor during the pendency of the arbitration.
Upon an employer's failure to make timely payment as
scheduled by the sponsor, the sponsor may bring suit to enforce
the withdrawal liability. § 1451(b). The limitations period for
such an action is six years from the date of the default in
Many of the facts of this case are in dispute. Although many
of the facts which follow are taken from the Fund's complaint
and its proposed amended complaint, all significant differences
between the Fund's allegations and BBLC's contentions are
The Fund alleges that prior to 1983, BBLC, operating as
Blassport-BBLC, made regular contributions to the Fund on
behalf of some of its own employees and on behalf of employees
of companies that manufactured garments for it. According to
the Fund, the total amount received from Blassport between 1975
and 1982 was $607,413.69. BBLC for its part claims that it has
never made any contributions to the Fund.
In or around August of 1983, BBLC sold its assets to Design
Assets Holdings, Inc. ("DAHI") and changed its name to BBLC. At
the same time, DAHI adopted the name Blassport, Ltd.
("Blassport-DAHI") and, the Fund asserts, began to make
contributions to the Fund. The Fund also asserts that at the
time of the sale of its ...