Third Circuit Holds Pension Fund’s Failure to Demand Withdrawal Liability “As Soon as Practicable” Bars Recovery

In RTI Restoration Techs., Inc. v. Int’l Painters & Allied Trades Indus. Pension Fund, No. 24-2874, —F.4th—-, 2026 WL 588429 (3d Cir. Mar. 3, 2026), the Third Circuit affirmed summary judgment in favor of two companies accused of successor liability for a defunct employer’s withdrawal liability, holding that the pension fund’s eight-year delay in issuing a withdrawal liability demand violated the Multiemployer Pension Plan Amendments Act’s requirement that notice and demand be made “as soon as practicable.”

The case arose after a contributing employer ceased operations in 2013. Years later, a multiemployer pension fund concluded that the employer had incurred withdrawal liability and sought to recover roughly $800,000 from two related companies under successor and alter-ego theories. The companies denied liability and filed a declaratory judgment action seeking a ruling that they were not employers under ERISA and therefore could not be responsible for the withdrawal liability.

The fund did not notify the companies of the alleged liability until 2021—eight years after the contributing employer’s withdrawal. The district court found factual disputes regarding whether the companies qualified as employers under ERISA but nevertheless granted summary judgment for the companies because the fund failed to provide notice and demand “as soon as practicable” as required by 29 U.S.C. § 1399(b)(1).

On appeal, the pension fund argued that the companies waived any challenge to the timeliness of the demand by failing to raise the issue in arbitration. Under the MPPAA, disputes concerning withdrawal liability determinations typically must be resolved through arbitration.

The Third Circuit rejected that argument and affirmed. Relying on its recent decision in Allied Painting & Decorating, the court explained that a withdrawal liability claim accrues only after three statutory steps occur: (1) an employer withdraws from the plan, (2) the fund issues notice and demand for withdrawal liability “as soon as practicable,” and (3) the employer defaults on a payment. Because timely notice and demand is an element of the claim itself—not merely an affirmative defense—the issue is not waived simply because it was not raised in arbitration.

The court further held that determining whether the fund acted “as soon as practicable” does not necessarily require arbitration. In this case, the issue could be resolved by the district court because the record showed the fund had sufficient information by 2013 to identify the withdrawal but did not issue its demand until 2021. Given that delay, the court concluded the statutory requirement was not satisfied. Because timely notice and demand is a prerequisite to a withdrawal liability claim, the fund’s failure to act promptly barred recovery altogether.

The Third Circuit therefore affirmed judgment for the companies without resolving the disputed question of whether they were employers or successors under ERISA.