& Exhibit "A " attached thereto (Report of Hewitt Associates, the Trust's actuaries). The defendants' claim that the trustees' decision was a prudent one for the Trust does not, on its face, appear to justify disregarding the language of § 11.03.
Second, the defendants claim that it would be inequitable for the Trust to pay investment income to a withdrawing employer given the Trust's status as a partially capitalized "pooled-risk" entity. However, it is not apparent beyond doubt that a withdrawing employer's entitlement to investment income is in fact incompatible with this "pooled-risk" Trust.
Under the "pooled-risk" provisions of the Trust, contributing employers made payments to the Trust without assigning their contributions to particular periods. If payments exceeded what was needed to pay the benefits due in a current period, the remainder was capitalized for use in future periods. In the defendants' view, the plaintiffs' claim for investment income amounts to an unwillingness to accept the responsibilities along with the benefits of a pooled-risk arrangement.
There are two distinct periods during which Wheaton may have a claim to investment income: the period during which Wheaton was a contributor to the Trust (any point prior to Wheaton's withdrawal) and the period after the establishment of a segregated fund (any point after Wheaton's withdrawal). The defendants have not proffered sufficient evidence to support their claim of undue benefit for either period. Without such a showing, the defendants cannot prevail on summary judgment because the plaintiffs have established the existence of the essential elements of their case through the language of the Trust agreement. See Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 91 L. Ed. 2d 265, 106 S. Ct. 2548 (1986).
The claim of undue benefit with respect to the period prior to Wheaton's withdrawal requires actuarial data indicating that the Trust allocated the investment income that accrued on Wheaton's contributions to cover Wheaton's share of risk during its participation in the plan. The defendants have not presented such data. Moreover, the defendants' claim of unjust benefit is substantially weaker with respect to the interest that has accrued on Wheaton's segregated fund since the time of Wheaton's withdrawal. Presumably, the plaintiffs no longer receive the benefits of a "pooled-risk" fund once they have withdrawn their contributions, because beneficiaries of the segregated fund will receive payments only up to the amount actually remaining in the fund; the Trust will not cover claims once the segregated fund is exhausted. The record simply does not support the claim that the interest earned after the time of segregation is compensation for the Trust's coverage of risk prior to withdrawal. Because the defendants have not offered clear actuarial support for viewing interest income that accrued after segregation as payment for past risk, they cannot prevail on summary judgment.
Finally, the defendants contend that the recognized statutory power of pension fund trusts to charge a withdrawing employer an exit fee in certain circumstances, pursuant to the Multiemployer Pension Plan Amendments Act of 1980 ("MPPAA"), 29 U.S.C. § 1381 et seq., supports recognition in this case of the lesser power for the trustees to interpret the Trust agreement so as to withhold investment income. See Transcript of Oral Argument, Doc. No. 23, at 22-24. But, as counsel for the defendants pointed out in oral argument, the exit fee provisions under the MPPAA extend only to the pension fund context and not to the welfare benefit context. See Transcript of Oral Argument, Doc. No. 23, at 23-24; see also 29 U.S.C. § 1381, et seq. (1980). There is neither evidence on the record nor any provision in the MPPAA that supports the claim that the Trust could have charged the plaintiffs an exit fee. The structure of the defendants argument -- that the "greater power includes the lesser" -- cannot withstand the absence of the Trust's possessing the greater power.
The language of the Trust agreement provides sufficient reason for a reasonable factfinder to conclude that the trustees' interpretation of the withdrawal provisions is clearly unreasonable. On this basis, summary judgment must be denied.
ORDER - July 27, 1988
For the reasons stated in the accompanying Memorandum, the defendant's Motion for Summary Judgment is DENIED.