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Bankruptcy judge sides with Yellow on question of venue for pension plan dispute

March 29, 2024
But a Kansas judge has dismissed the company’s lawsuit against the Teamsters. Retirement plan representatives want Yellow to cover $7.8 billion in liabilities.

The judge overseeing the Yellow Corp. Chapter 11 bankruptcy decided he—and not an arbitrator—will oversee the contentious, high-dollar pension liability dispute at the heart of the case.

Yellow, which was the third-largest U.S. less-than-truckload carrier in the weeks before it filed for protection from its creditors last July, has been battling with a hatful of retirement plans representing many of its former employees as well as the federal Pension Benefit Guaranty Corp. about what the company might still owe the pension plans. The plans, led by Central States Pension Fund, submitted claims that Yellow should pony up $7.8 billion to cover its so-called withdrawal liabilities for pulling out the plans when it closed its doors last summer. Yellow’s attorneys have countered that the pension plans can’t call on the company for that money because the federal government’s bailout early last year covered all of their funding needs.

In addition to that core financial dispute, the sides debated how and where to resolve this thorny question. The retirement plans called on Judge Craig Goldblatt to refer the matter to an arbitrator, saying that such a move is required by the Multiemployer Pension Plan Amendments Act of 1980. Yellow argued that Goldblatt and the U.S. Bankruptcy Court for the District of Delaware should address the dispute as part of the Chapter 11 proceeding.

See also: Study: Digitizing complicated LTL shipments benefits fleets’ bottom lines

About the Author

Geert De Lombaerde | Senior Editor

A native of Belgium, Geert De Lombaerde has more than two decades of business journalism experience and writes about markets and economic trends for Endeavor Business Media publications FleetOwner, Healthcare InnovationIndustryWeek, Oil & Gas Journal and T&D World. With a degree in journalism from the University of Missouri, he began his reporting career at the Business Courier in Cincinnati and later was managing editor and editor of the Nashville Business Journal. Most recently, he oversaw the online and print products of the Nashville Post and reported primarily on Middle Tennessee’s finance sector as well as many of its publicly traded companies.

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