ERISA Support for Bankruptcy and Liquidation Professionals

Under Section 704(a)(11) of the Bankruptcy Code, Chapter 7 bankruptcy trustees must perform plan administrator functions with respect to the debtor’s ERISA-governed plans. This duty also applies to Chapter 11 bankruptcy trustees under Section 1106(a)(1) of the Bankruptcy Code.

Smith & Downey has extensive experience with the benefits side of the bankruptcy process and the special and sensitive issues that bankruptcy trustees, bankruptcy attorneys and other bankruptcy professionals are required to navigate with respect to ERISA-governed plans.

The firm routinely represents trustees in Chapter 11 and Chapter 7 bankruptcy cases with respect to ERISA issues and also represents receivers and others in non-bankruptcy liquidations with regard to these issues. Smith & Downey successfully manages the unusual issues that arise when administering and/or terminating a debtor’s tax-qualified retirement plans, medical plans, executive plans and any other benefit or compensation arrangements. The firm regularly works with counsel for bankruptcy trustees and other specialized service providers engaged by bankruptcy trustees to ensure that the compliance and other obligations associated with a debtor’s ERISA-governed plans are resolved properly. Special areas of competency and experience include:

  • Helping bankruptcy trustees and others avoid ERISA fiduciary liability with respect to a debtor’s plans;
  • Ensuring that plan-related fees are payable from plan assets (e.g., rather than as a Chapter 7 or Chapter 11 administrative fee payable from the bankruptcy estate), wherever possible;
  • Adapting our processes and fee arrangement to the particular situation involved;
  • Aggressively managing plan service providers’ services and fees;
  • Managing and resolving regulatory investigations (DOL, IRS, and/or PBGC, etc.);
  • Resolving benefit disputes with participants, employment disputes with employees and former owner disputes.

Sandi Russell leads this practice area for Smith & Downey.

Smith & Downey's practice as special ERISA counsel in bankruptcy cases is an element of the firm's nationwide work in employee benefits and executive compensation law. For additional information, contact Smith & Downey.

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