Sun Capital Ruling Exposes PE Funds To Pension Liabilities
July 31, 2013, 2:51 PM EDT
Law360, New York (July 31, 2013, 2:51 PM EDT) -- On July 24, 2013, the U.S. Court of Appeals for the First Circuit held that a private equity fund sponsored by Sun Capital Advisors constituted a “trade or business” for purposes of Employee Retirement Income Security Act (ERISA) multiemployer pension withdrawal liability. The decision may have a significant impact on the private equity sector.
Although there has long been uncertainty regarding whether a private equity fund or its other portfolio companies may be liable for the unfunded pension obligations of one of the PE fund’s...