In the

United States Court of Appeals For the Seventh Circuit ____________________

Nos. 24-1739, 24-1740, 24-1741 & 24-1742 CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND and CHARLES A. WHOBREY, Plaintiffs-Appellants,

v.

EVENT MEDIA INC., d/b/a COMPLETE CREWING, Defendant-Appellee. ____________________

EVENT MEDIA INC., d/b/a COMPLETE CREWING, Plaintiff-Appellee,

v.

CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND, Defendant-Appellant. ____________________ 2 Nos. 24-1739, 24-1740, 24-1741 & 24-1742

PACK EXPO SERVICES, LLC, Plaintiff-Appellee,

v.

CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND, Defendant-Appellant. ____________________

CENTRAL STATES, SOUTHEAST AND SOUTHWEST AREAS PENSION FUND and CHARLES A. WHOBREY, Plaintiffs-Appellants,

v.

PACK EXPO SERVICES, LLC, Defendant-Appellee. ____________________

Appeals from the United States District Court for the Northern District of Illinois, Eastern Division. Nos. 1:22-cv-6133, 1:22-cv-6143, 1:22-cv-6471 & 1:22-cv-6553 — Edmond E. Chang, Judge. ____________________

ARGUED DECEMBER 10, 2024 — DECIDED APRIL 24, 2025 ____________________

Before KIRSCH, LEE, and KOLAR, Circuit Judges. KIRSCH, Circuit Judge. This case presents a narrow question of statutory interpretation concerning multiemployer pension plans. Event Media Inc. and Pack Expo Services, LLC, were contributing employers to the Central States, Southeast and Nos. 24-1739, 24-1740, 24-1741 & 24-1742 3

Southwest Areas Pension Fund. They withdrew from the Fund and incurred withdrawal liability obligations. The em- ployers and Fund disagree over how to calculate those obli- gations, a dispute that requires us to interpret 29 U.S.C. § 1085(g)(3). In a well-reasoned opinion, the district court held that the employers’ post-2014 contribution rate increases should be excluded from the calculation. We affirm. I A Although our interpretive question is narrow, it involves a complex web of pension plan statutes. Congress enacted the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1001 et seq., “to ensure that employees and their beneficiaries would not be deprived of anticipated retirement benefits by the termination of pension plans before sufficient funds have been accumulated in them.” Concrete Pipe & Prods. of Cal., Inc. v. Constr. Laborers Pension Tr. for S. Cal., 508 U.S. 602, 607 (1993) (cleaned up). To that end, ERISA provides that any employer who withdraws from an insolvent pension plan during the five years prior to insolvency is “liable for a fair share of the plan’s underfunding.” Milwaukee Brewery Work- ers’ Pension Plan v. Joseph Schlitz Brewing Co., 513 U.S. 414, 416 (1995). But this provision had an unintended consequence. It “encouraged an employer to withdraw from a financially shaky plan and risk paying its share if the plan later became insolvent, rather than to remain and (if others withdrew) risk having to bear alone the entire cost of keeping the shaky plan afloat.” Id. at 416–17. “Consequently, a plan’s financial trou- bles could trigger a stampede for the exit doors, thereby en- suring the plan’s demise.” Id. at 417. 4 Nos. 24-1739, 24-1740, 24-1741 & 24-1742

To fix this problem, Congress passed the Multiemployer Pension Plan Amendments Act of 1980, 29 U.S.C. §§ 1381– 1461, which requires “employers who withdraw from under- funded multiemployer pension plans to pay withdrawal lia- bility.” Bay Area Laundry & Dry Cleaning Pension Tr. Fund v. Ferbar Corp. of Cal., Inc., 522 U.S. 192, 196 (1997) (quotation omitted). An employer’s withdrawal liability “roughly matches [its] proportionate share of the plan’s unfunded vested benefits.” Id. (quotation omitted). Withdrawing em- ployers may make their withdrawal liability payments in ei- ther one lump sum or periodic installments, id. at 195, and in- stallments are calculated using the employer’s “highest con- tribution rate” during the ten years before withdrawal, 29 U.S.C. § 1399(c)(1)(C)(i)(II). Congress later passed the Pension Protection Act of 2006, which requires underfunded multiemployer pension plans to take certain remedial measures. Pub. L. No. 109–280, 120 Stat. 780. Now, pension plans in “endangered status” must adopt “funding improvement plan[s],” and pension plans in “criti- cal status” or “critical and declining status” must adopt “re- habilitation plan[s].” 29 U.S.C. § 1085(a). Both measures re- quire the pension plan to propose changes—reduce future benefit accruals, increase contributions, or both—that would enable the plan to recover from its underfunded status. Id. § 1085(c)(1)(B)(i) & (e)(1)(B). But the Pension Protection Act’s requirements created an- other unintended consequence. Although Congress intended an employer’s withdrawal liability and its share of a pension plan’s unfunded vested benefits to rise and fall together (that is, an employer pays more to withdraw if it has more un- funded vested benefits in the plan), see Bay Area Laundry, 522 Nos. 24-1739, 24-1740, 24-1741 & 24-1742 5

U.S. at 196; Pension Benefit Guar. Corp. v. R.A. Gray & Co., 467 U.S. 717, 725 (1984), the opposite now occurred. An em- ployer’s withdrawal liability increased as its share of un- funded vested benefits decreased (that is, it paid more to withdraw despite having fewer unfunded vested benefits in the plan). See Methods for Computing Withdrawal Liability, Multiemployer Pension Reform Act of 2014, 86 Fed. Reg. 1256, 1264 (Jan. 8, 2021). This happened because an employer’s pe- riodic withdrawal liability payments are calculated using its highest contribution rate in the past ten years, 29 U.S.C. § 1399(c)(1)(C)(i)(II), and a funding improvement plan or re- habilitation plan often requires employers to increase their contribution rates, see id. § 1085(c)(1)(B)(i) & (e)(1)(B). Thus, as an employer’s contribution rate increased to reduce un- funded vested benefits, the penalty for withdrawing also in- creased. To address this issue, Congress adopted the Multiem- ployer Pension Reform Act of 2014, which excludes certain post-2014 increases in an employer’s contribution rate from the calculation of its periodic withdrawal liability payments. Pub. L. No. 113-235, Div. O, § 109, 128 Stat. 2130, 2789–92 (cod- ified at 26 U.S.C. § 432, 29 U.S.C. § 1085); see also Methods for Computing Withdrawal Liability, 86 Fed. Reg. at 1264. Specif- ically, § 1085(g)(3) outlines the “[c]ontribution increases re- quired by funding improvement or rehabilitation plan[s]” that are disregarded in withdrawal liability determinations: (A) In general Any increase in the contribution rate … that is required or made in order to enable the plan to meet the requirement of the funding improve- ment plan or rehabilitation plan shall be 6 Nos. 24-1739, 24-1740, 24-1741 & 24-1742

disregarded in determining … the highest con- tribution rate …. Id. § 1085(g)(3)(A). And any increase in the contribution rate is deemed required to meet the funding improvement or re- habilitation plan with two exceptions: (B) Special rules For purposes of this paragraph, any increase in the contribution rate … shall be deemed to be required or made in order to enable the plan to meet the requirement of the funding improve- ment plan or rehabilitation plan except for [1] increases in contribution requirements due to increased levels of work, employment, or peri- ods for which compensation is provided or [2] additional contributions are used to provide an increase in benefits, including an increase in fu- ture benefit accruals, permitted by subsection (d)(1)(B) or (f)(1)(B). Id. § 1085(g)(3)(B). This appeal concerns the second exception and the meaning of “permitted by subsection … (f)(1)(B).” B Event Media Inc. and Pack Expo Services, LLC, (collec- tively, the Employers) were contributing employers to the Central States, Southeast and Southwest Areas Pension Fund. In 2008, the Fund’s actuary certified that the Fund was in crit- ical status, which required it to adopt a rehabilitation plan. See 29 U.S.C. § 1085(a)(2) & (b)(2). When the Fund’s actuary certified in 2019 that the Fund was in critical and declining status and projected it would become insolvent by 2025, the Nos. 24-1739, 24-1740, 24-1741 & 24-1742 7

Employers withdrew from the Fund and incurred with- drawal liability obligations. The parties dispute how much the Employers must pay in periodic installments. In 2014, each Employer’s contribution rate was $328, and it increased every year until reaching $424 in 2019, the year the Employers withdrew from the Fund. When calculating the Employers’ withdrawal liability pay- ments, the Fund used the higher 2019 rate because that was the “highest contribution rate” in the past ten years. See id. § 1399(c)(1)(C)(i)(II). The Employers argue the Fund should have used the lower 2014 rate because § 1085(g)(3) excludes from the calculation all post-2014 contribution rate increases that are required by a rehabilitation plan. This dispute pre- sents a question of first impression for the courts of appeals. We conclude that the Fund should have used the 2014 rate. II Despite ERISA’s labyrinthian structure, this exercise in statutory interpretation is straightforward. When determin- ing the highest contribution rate a pension plan should use to calculate an employer’s periodic withdrawal liability pay- ments, § 1085(g)(3)(A) disregards any post-2014 contribution rate increase that is required to meet a funding improvement plan or rehabilitation plan. And all contribution rate increases are deemed “required” unless either of two exceptions ap- plies. 29 U.S.C. § 1085(g)(3)(B). Neither does in this case, so the Employers’ post-2014 contribution rate increases are dis- regarded from their withdrawal liability payment calcula- tions. The first exception is “for increases in contribution re- quirements due to increased levels of work, employment, or 8 Nos. 24-1739, 24-1740, 24-1741 & 24-1742

periods for which compensation is provided.” Id. The parties agree this exception doesn’t apply. The second is for “addi- tional contributions … used to provide an increase in benefits, including an increase in future benefit accruals, permitted by subsection (d)(1)(B) or (f)(1)(B).” Id. The parties likewise agree that § 1085(d)(1)(B) doesn’t apply (nor could it, because it’s for funding improvement plans, and the Fund adopted a rehabil- itation plan). The Fund instead focuses on § 1085(f)(1)(b) and argues that the post-2014 contribution rate increases were used to provide an increase in benefits permitted by § 1085(f)(1)(B). We disagree. Section 1085(f)(1)(B) permits amendments to a pension plan that increase benefits, but only where “the plan actuary certifies that such increase is paid for out of additional contri- butions not contemplated by the rehabilitation plan.” The parties agree there was no amendment, and the Fund points us to no actuarial certification, so § 1085(f)(1)(B) doesn’t apply either. Because the post-2014 contribution rate increases were not “permitted by subsection … (f)(1)(B),” the Fund must dis- regard them in calculating the Employers’ withdrawal liabil- ity payments. 29 U.S.C. § 1085(g)(3)(B). The Fund contends that “permitted by subsection … (f)(1)(B)” really means not prohibited by subsection (f)(1)(B). Because § 1085(f)(1)(B) only deals with amendments to a pen- sion plan made after the adoption of a rehabilitation plan, the Fund believes that increases in the contribution rate predating the rehabilitation plan do not require a plan amendment and are thus not prohibited by § 1085(f)(1)(B). The Fund says this includes the contribution rate increases at issue here because they were included in the Fund’s pension plan documents that predate the rehabilitation plan. But the Fund’s argument Nos. 24-1739, 24-1740, 24-1741 & 24-1742 9

does not convince us. If Congress meant not prohibited, it could have used those words. And although the Fund argues permitted can be construed passively to mean not prohibited, see Legal Maxims, Black’s Law Dictionary (12th ed. 2024) (“Everything that the law does not forbid is permitted.”), we believe the better construction of the statutory language re- quires more affirmative permission. What § 1085(f)(1)(B) af- firmatively permits is post-rehabilitation plan amendments to the pension plan, accompanied by actuarial certification. Be- cause the post-2014 contribution rate increases were not in- cluded as an amendment to the rehabilitation plan and were not accompanied by actuarial certification, they were not “permitted by subsection … (f)(1)(B).” More broadly, the Fund construes § 1085(g)(3) to in- clude—not disregard—all contribution rate increases in with- drawal liability payment calculations unless those increases reduce unfunded vested benefits or were made via an amend- ment but unaccompanied by an actuarial certification. It ar- gues that § 1085(g)(3)(B) simply lays out some examples of contribution rate increases to be included in calculating an employer’s withdrawal liability, rather than establishing the only exceptions to the general prohibition against including contribution rate increases. The Fund justifies this interpreta- tion by arguing § 1085(g)(3) has a specific and limited pur- pose: to avoid an undesirable outcome where an employer re- duces a pension plan’s unfunded vested benefits—thereby improving the health of the pension plan and furthering the rehabilitation plan’s requirements—but at the same time counterproductively increases its withdrawal liability. But the Fund ignores the language of the statute. Section 1085(g)(3) excludes contribution rate increases “[i]n general,” 10 Nos. 24-1739, 24-1740, 24-1741 & 24-1742

unless some limited, “[s]pecial” exception applies. It provides that any contribution rate increase required to meet the reha- bilitation plan shall be disregarded in calculating the highest contribution rate, id. § 1085(g)(3)(A), and it deems all contri- bution rate increases to be required to meet the rehabilitation plan unless, as relevant here, the rate increase is permitted by § 1085(f)(1)(B), id. § 1085(g)(3)(B). The Fund makes a reasona- ble argument about § 1085(g)(3)’s purpose, but ERISA is “an enormously complex and detailed statute that resolved innu- merable disputes between powerful competing interests.” Mertens v. Hewitt Assocs., 508 U.S. 248, 262 (1993). Balancing those competing interests is Congress’s job, which it has re- peatedly performed by revising the statutory scheme for mul- tiemployer pension plans. Our job is to interpret the text Con- gress provides. We decline the Fund’s invitation to stray be- yond that text and balance the interests ourselves. AFFIRMED