Federal judge rules Dominick's can't get $9M pension credit from union, despite agreement

By Jenna Lyons | Jun 11, 2019

CHICAGO – A federal judge has rejected a request from defunct supermarket chain Dominick's Finer Foods to force a union to give it a credit against its employee pension contributions, worth $9 million.

U.S. District Judge Elaine Bucklo granted the union’s motion to dismiss the claim on June 6 in the U.S. Distict Court for the Northern District of Illinois. 

Dominick's, establishing its claim using a section of the Employee Retirement Income Security Act (ERISA), initially filed a breach of contract lawsuit against the United Food and Commercial Workers Unions and Employers Midwest Pension Fund. The supermarket alleged the fund failed to credit or refund excess payments made by Dominick's despite an agreement to do so.

According to a consent resolution the fund passed on Nov. 9, 2010, if Dominick’s made contributions in excess of the rehabilitation plan schedules, then “the [Fund’s] Trustees shall provide an equitable credit to Dominick’s.”

In the ruling, Bucklo said Dominick’s could not bring a suit on the grounds outlined by the ERISA section because the store was a “withdrawn employer with no ongoing contribution to the fund.”

On a legal basis, the judge found there is no written statement included that addresses what happens if Dominick withdraws from the fund, the court ruled.

Dominick’s withdrew from the fund in 2014. On June 6, 2014, the fund rejected a request made by Dominicks’s to offset the withdrawal liability by the $9 million in excess voluntary payments made. The chain filed the suit nearly four years later.

The judge said the written agreement in question did not support Dominick's allegations of a contact breach.   

“I note that Dominick’s breach of contract claim fails for the independent reason that it is not supported by the complaint’s allegations or attached materials,” Bucklo wrote in the ruling. “The most salient flaw in the contracts claim is that Dominick’s has not identified any contract containing either the rights it asserts or the obligations it seeks to enforce.”

The UFCW is represented in the case by the firm of Reinhart Boerner Van Deuren S.C., of Milwaukee, and The Karmel Law Firm, of Chicago.

Dominick's is represented by the firms of Goldberg Kohn Ltd., of Chicago, and Schulte Roth & Zabel LLP, of New York.

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Organizations in this Story

Goldberg-Kohn Reinhart Boerner Van Deuren U.S. District Court for the Northern District of Illinois United Food and Commercial Workers International Union

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