Rexam Inc. v. Berry Plastics Corp.

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This case involved a dispute between Plaintiffs, Rexas Inc., Rexam PLC, and Rexas Overseas Holdings Ltd. (“Rexam”), and Defendant Berry Plastics Corp. (“Berry”) over the risks of potential pension liability. In 2014, Berry agreed to purchase Rexam’s healthcare containers and closures business and accepted responsibility for the pensions of certain employees at one of Rexam’s facilities that it was acquiring (the “Rexam Pension Plan”). Before the anticipated closing, the Pnesion Benefit Guaranty Corp. (“PBGC”) notified Rexam that it had initiated an inquiry into the Pension Plan Transfer (the “PBGC Inquiry”). As part of the closing, the parties agreed to defer the Pension Plan Transfer. After the closing, the PBGC sent an email regarding the Pension Plan Transfer. Berry then informed Rexam that it would not complete the Pension Plan Transfer because it considered the PBGC’s email evidence of a threatened legal or administrative action by the PBGC. Rexam sued Berry for breach of contract. The Court of Chancery entered judgment on the pleadings in favor of Rexam and against Berry, holding that the PBGC did not “threaten” to take action, and therefore, Berry’s performance - acceptance of the Pension Plan Transfer - was not excused because of the PBGC Inquiry. View "Rexam Inc. v. Berry Plastics Corp." on Justia Law