Pension Plan Withdrawal Liability Presents A “Risky Gambit” to Private Equity Funds

Guest post by Michael T. Bindner of Frost Brown Todd LLC

A Federal District Court recently called investments in private companies that participate in a multiemployer pension plan (MPP) a “risky gambit” because of the potential for exposing the MMP’s investors to withdrawal liability[1]. This type of liability is sometimes referred to as a “hidden liability” because, in some situations, investors may have exposure for the liability even if they did not affirmatively assume the liability under a purchase agreement.

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