32BJ N. Pension Fund v. Nutrition Mgmt. Servs. Co., 935 F.3d 93

Background

NMSC (employer) signed a 1998 collective bargaining agreement (CBA) requiring pension contributions to the 32BJ North Pension Fund (the Fund); Article 22 stated the Fund “will be held and managed under the terms and provisions of an Agreement and Declaration of Trust to be executed.”
The Fund’s trustees adopted a Delinquency Policy (2008, 10% interest; revised 2013 to 9%) pursuant to the Trust Agreement, which authorized trustee-set interest on unpaid contributions.
NMSC failed to make required contributions from 2008–2015; audits and litigation followed. The district court awarded unpaid contributions plus interest at the Delinquency Policy rate from 2008 onward.
In 2014 NMSC executed a Memorandum of Agreement (MOA) amending/extending the CBA and expressly stating that NMSC “hereby adopts and shall be bound by the [Trust Agreement] … and the rules and regulations adopted … by the Trustees,” effective August 1, 2013.
The district court held the 1998 CBA’s reference to a Trust Agreement bound NMSC to the Trust Agreement (and the Delinquency Policy) as of 1998. The Second Circuit reversed on the interest issue and remanded for redetermination of damages and attorney’s fees.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether NMSC was bound to the Trust Agreement (and Delinquency Policy) by the 1998 CBA	The 1998 CBA referenced the Trust Agreement; that reference bound NMSC to the Trust Agreement and its interest rules from 1998	The 1998 language merely acknowledged a future trust; NMSC did not objectively manifest intent to be bound until the 2014 MOA	Court: Employer is bound only if it objectively manifests intent to be bound; 1998 CBA did not do so—NMSC became bound when it executed the 2014 MOA (effective Aug 1, 2013)
Whether trustees could unilaterally impose the plan-based interest rate on a non‑agreeing employer	Even if not bound earlier, the Fund’s trustees could unilaterally impose the Delinquency Policy rate because it is essential to fund management	Unilateral imposition is impermissible; such a term is contractual and requires employer assent	Court: Trustees cannot unilaterally impose plan-based interest rates; such provisions are like liquidated-damages terms and require employer agreement
Proper start date for applying the Delinquency Policy interest rate	Interest rate applies from when contributions became delinquent (2008) because Trust Agreement and policy govern the Fund	Interest rate applies only from the MOA’s effective date (Aug 1, 2013) because NMSC did not agree earlier	Court: Interest rate only applies from the point employer agreed to be bound (post-MOA); remanded to redetermine damages and interest period
Attorney’s fees award	Fee award based on original judgment including contested interest; Fund seeks full fees awarded	NMSC contests excessiveness and billing practices; requests reconsideration if damages reduced	Court: Vacated judgment; remanded the fee award for reconsideration after damages are recalculated

Key Cases Cited

Jaspan v. Glover Bottled Gas Corp., 80 F.3d 38 (2d Cir.) (collective‑bargaining obligation to pay contributions does not, by itself, bind an employer to terms of a trust agreement it never joined)
Silverman v. Teamsters Local 210 Affiliated Health & Ins. Fund, 761 F.3d 277 (2d Cir.) (the plan may be the trust agreement under which a fund is formed)
Ronan Assocs. v. Local 94-94A-94B, 24 F.3d 447 (2d Cir. 1994) (incorporation by reference requires objective manifestation of intent to be bound)
Iron Workers Dist. Council v. Hudson Steel Fabricators & Erectors, Inc., 68 F.3d 1502 (2d Cir. 1995) (discussion of effect of post‑suit payments on remedies under § 1132(g)(2))
M&G Polymers USA, LLC v. Tackett, 135 S. Ct. 926 (2015) (CBAs and ERISA plan documents are interpreted under ordinary contract principles)
CNH Indus. N.V. v. Reese, 138 S. Ct. 761 (2018) (same: interpret CBAs and ERISA plans according to ordinary contract law)