Resilient Floor Covering Pension Fund v. M&M Installation, Inc.

This appeal involves a “double-breasted” operation where a non-union employer, Si-mas Floor Co., Inc., set up a union employer, M & M Installation, Inc. to handle union flooring work. The question is whether the non-union company, Simas Floor, is liable for withdrawal liability incurred by the union company, M&M Installation, pursuant to the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1001 et seq., as amended by the Multiemployer Pension Plan Amendments Act of 1980 (MPPAA), 29 U.S.C. §§ 1381-1453 . We conclude that assuming it is possible to be responsible on an alter ego theory, the non-union company may be liable when there is commonality between the union and non-union firms and an abuse of the double-breasted structure to avoid payment of withdrawal liability. As the district court applied a different standard that focused on whether Simas Floor’s actions undermined the purposes of ERISA and MPPAA, Resilient Floor Covering Pension Fund v. M & M Instal lation, Inc., 651 F.Supp.2d 1057 (N.D.Cal. 2009), we reverse and remand. The district court also rejected the Pension Fund’s claim that it could accelerate the withdrawal payments. The Fund…