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I. Introduction

In 2014, Second Street Properties, f/k/a Pacific Steel 194057 ms -l-

Casting Company (“Second Street”) and its wholly owned subsidiary Berkeley Properties, LLC (“Berkeley Properties”) filed chapter 11 cases. At the time, Second Street had a collective bargaining agreement (the “CBA”) with its union employees and participated in a multiemployer pension plan (“Local 164B” and the “MEP”). The court approved Second Street’s sale of its steel foundry business to a new entity referred to here as Pacific Steel or the Debtor. The sale was documented by an asset purchase agreement (the “APA”) which was structured to comply with ERISA §4204 so that Second Street could avoid paying the large withdrawal liability to the MEP that it otherwise faced, then estimated to be between $20 million and $27 million (the “Contingent Withdrawal Liability”). To take advantage of this special treatment, ERISA required both parties to the transaction to do certain things. As buyer, Pacific Steel had to post and maintain a bond payable upon default to the MEP and perform in a certain…