# Government Employees Retiremen v. Government of the Virgin Islan

> Court of Appeals for the Third Circuit · April 9, 2021

URL: https://www.frixlaw.com/law-library/cases/4676154

## Case

- **Court:** Court of Appeals for the Third Circuit
- **Decided:** April 9, 2021
- **Precedential status:** Published
- **Opinion:** Opinion
- **Cited by:** 0 later opinions in the Frix Law Library

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- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/4676154

## How later opinions describe it (automated extraction)

- noting that courts “ordinarily resist reading words or elements into a statute that do not appear on its face”

## Opinion text

PRECEDENTIAL

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
_______________________

Nos. 20-1749 and 20-1766
_______________________

GOVERNMENT EMPLOYEES RETIREMENT
SYSTEM OF THE VIRGIN ISLANDS,
Appellant in No. 20-1766

v.

THE GOVERNMENT OF THE VIRGIN ISLANDS;
COMMISSIONER OF FINANCE OF THE
GOVERNMENT OF THE VIRGIN ISLANDS,
Appellants in No. 20-1749
_______________________

On Appeal from the District Court
of the Virgin Islands
(D.C. No. 3:81-cv-00005)
District Judge: The Honorable Curtis V. Gomez
__________________________

Argued December 8, 2020

Before: SMITH, Chief Judge, CHAGARES and MATEY,
Circuit Judges

(Filed: April 9, 2021)
Robert D. Klausner [ARGUED]
KLAUSNER, KAUFMAN, JENSEN & LEVINSON
7080 N. W. 4th Street
Plantation, FL 33317

Cathy M. Smith
GOVERNMENT EMPLOYEES RETIREMENT SYSTEM
3438 Kronprindsens Gade
GERS Complex, Suite 1
St. Thomas, VI 00802
Counsel for Government Employees Retirement System

Brigid F. Cech Samole
Katherine M. Clemente
Elliot H. Scherker [ARGUED]
GREENBERG TRAURIG, LLP
333 Southeast 2nd Avenue
Suite 4400
Miami, FL 33131

Angel Taveras
WOMBLE BOND DICKINSON LLP
Independence Wharf
470 Atlantic Avenue
Suite 600
Boston MA 02110

Carol L. Thomas-Jacobs
OFFICE OF ATTORNEY GENERAL OF VIRGIN ISLANDS
Department of Justice
34-38 Kronprindsens Gade
GERS Complex, 2nd Floor
St. Thomas, VI 00802

‐ii-
Counsel for Government of the Virgin Islands and
Commissioner of Finance of Government of the Virgin
Islands

Ian H. Gershengorn
JENNER & BLOCK LLP
1099 New York Avenue, N.W.
Suite 900
Washington DC 20001
Counsel for Amicus Appellees

TABLE OF CONTENTS
I. Background and Procedural History _____________ 3
A. Legal Background ____________________________ 3
1. Creation of GERS in 1959 ____________________ 3
2. The 1968 amendments _______________________ 5
3. The 2005 amendments _______________________ 5
B. Procedural History ___________________________ 7
1. The 1981 complaint _________________________ 7
2. The 1984 consent judgment ___________________ 8
3. The 1994 amendment to the consent judgment ____ 8
4. The tangential 2001 action ___________________ 9
5. The 2016 enforcement proceedings ____________ 10
II. Jurisdiction and Standard of Review ____________ 15
III. The GVI’s Appeal____________________________ 16
A. Principal Award to GERS _____________________ 17
1. The historical under-contributions fall within the
consent judgment ___________________________ 17

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2. The GVI’s historical under-contributions were
properly before the District Court ______________ 19
3. Direct contributions to GERS and the true-up process
do not offset the award _______________________ 28
4. The expert reliably calculated the $18.9 million in
principal __________________________________ 31
B. Award of Fees and Interest to GERS ____________ 32
1. The statutes are not intended only for willful
misconduct ________________________________ 33
2. The District Court erred by applying the statutes
retroactively _______________________________ 35
3. GERS’s action was timely ____________________ 42
IV. GERS’s Cross-Appeal ________________________ 51
A. GERS’s Textual Arguments ___________________ 54
B. GERS’s Authorities _________________________ 59
C. The Parties’ Historical Understanding ___________ 62
V. Conclusion __________________________________ 66

‐iv-
__________________________

OPINION OF THE COURT
_________________________

SMITH, Chief Judge.

The promise of a pension is critical to the retirement se-
curity of many of us who work. And retirement security “is
often compared to a three-legged stool supported by Social
Security, employer-provided pension funds, and private
savings.”1 When an employer’s promise of deferred compen-
sation goes unfulfilled, the expectations of many-a-pensioner
are upended. That threat looms for a substantial share of the
citizenry of the U.S. Virgin Islands because of the perilous fi-
nancial condition of its Government Employees Retirement
System (“GERS”).

When a public-pension system reaches the point where
it is actuarially unsound, the blame rarely lies with a single per-
son, political party, or institution. Economic recession, un-
funded legislative mandates, poor investment strategies—all
can conspire to destabilize a pension system. And each bears
responsibility for GERS’s untenable financial state.

But GERS has also faced a unique challenge. Virgin
Islands law seemingly fails to obligate anyone to fund GERS
when employee-compensation-based contributions and associ-
ated investment returns fall short of the assets required, based

1
Former Rep. Sander Levin, Social Security at 75: Don’t Mess
with Success, HUFFPOST (Aug. 16, 2010, 12:00 PM),
http://www.huffpost.com/entry/social-security-at-75-don_b_
683384.
on actuarial assessments, to meet future pension commitments.
For decades, GERS has experienced annual deficits between
its assets and projected liabilities to system participants. Its
aggregate shortfall now stands at about three billion dollars—
leaving the system on the brink of insolvency.

Yet the Government of the Virgin Islands (“GVI”) is it-
self fiscally challenged and has at times failed to remit to
GERS all the employer contributions it is statutorily mandated
to make. GERS has repeatedly sued the GVI for these contri-
butions—first in 1981, resulting in a consent judgment, and
most recently in 2016, when GERS sought to enforce that judg-
ment in court. GERS claimed that, as far back as 1991, the
GVI had contributed tens of millions of dollars less than
required by the statutory percentages of employee compensa-
tion. GERS also sought to compel the GVI to step into the
billion-dollar breach, arguing that—independent of these
fixed-percentage contributions—the GVI must fully fund
GERS to the point of actuarial soundness.

With an appointed expert’s help, the District Court
awarded GERS an amount calculated to reflect the GVI’s his-
torical percentage-based under-contributions. We will affirm
that award of principal. But the Court erred when it enhanced
the award by applying late-arriving interest and penalty stat-
utes retroactively. We will vacate the portion of the judgment
to GERS that includes those enhancements and remand with
instructions for the District Court to reduce its award accord-
ingly. Finally, the Court determined that the consent judgment
does not require the GVI to fund GERS for the delta between
its assets and liabilities. We, too, find no anchor for this sweep-
ing duty GERS seeks to impose on the GVI, so we will affirm
the District Court’s ruling in GERS’s cross-appeal. Even were
we to cut that obligation on a rationale made of whole cloth,

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the system would remain insolvent. The citizens of the United
States Virgin Islands—population 106,4052—simply cannot
pay the necessary billions. The cure for GERS’s chronic
underfunding is not judicial but legislative—if not at the terri-
torial level, then perhaps on Capitol Hill.

I. BACKGROUND AND PROCEDURAL HISTORY

We need not trace the long and winding road across
laws, history, politics, and litigation that has brought the Virgin
Islands’ public-pension system to where it is today. Instead,
we hew to the legal framework relevant to the questions pre-
sented and to the procedural narrative by which this case and
the parties’ arguments have wended their way to us.

A. Legal Background

1. Creation of GERS in 1959. By passing Act 479,
effective October 1, 1959, the unicameral legislature of the
Virgin Islands (“the Legislature”) created GERS as the retire-
ment system for GVI employees. GERS was “established as a
trust, separate and distinct from all other entities”; endowed
with “the powers and privileges of a corporation”; and required
to transact all its business and hold all its assets in its own
name. Act of June 24, 1959, No. 479, §§ 701(c), 715(a), 1959
V.I. Sess. Laws 92, 94, 104. The Legislature vested responsi-
bility for operating GERS in a board of trustees, which has the
power to authorize the purchase or sale of investments, make

2
United States Census Bureau, U.S. Virgin Islands Demo-
graphic Profile Summary File – 2010 Census of Population
and Housing (2013), available at https://www.census.gov/
schools/facts/u.s.%20virgin%20islands.

‐3-
contracts, and “sue and be sued” under the GERS name. Id.
§ 715(b)(3), (6). The system was “established as a part of the
Division of Personnel in the office of the Government Secre-
tary,” with the Director of Personnel acting as both administra-
tor of GERS and secretary of the board. Id. § 715(c).3

Act 479 also purported to fund GERS. It implemented
section 718 of the new Retirement Code, which provided first
that “[t]he various obligations of the system shall be financed
in accordance with actuarial reserve requirements from
contributions by members, contributions by the employer,
interest income, and other income accruing to the system.” Id.
§ 718. Section 718 then required employees to contribute to
GERS via a “deduction from compensation” at a rate of four
percent, with an annual compensation cap. Id. It also set an
annual compensation floor so that the GVI, as employer, would
contribute four percent for an employee “whose minimum rate
in his class of position is $1200 per annum, or less.” Id.

Unlike the specified employee contribution rate, section
718 did not fix the rate for the GVI’s employer contribution.
Instead, Section 718 obligated the GVI to “make [employer]
contributions concurrently with the contributions by members
in an amount which, if paid during such service, and added to
the members’ contributions, together with regular interest, will
be sufficient to provide actuarial reserves” for the payment of
benefits under the system. Id. These concurrent employer con-
tributions were to “be determined by applying a percentage rate
to the aggregate compensation of the members for each regular

3
In 1987, the Legislature amended section 715 to classify
GERS as an “independent and separate agency” of the GVI.
Act of June 24, 1987, No. 5265, § 1303(a), 1987 V.I. Sess.
Laws 92, 97; accord 3 V.I.C. § 715(a).

‐4-
payroll period.” Id. Section 718 provided for an annual com-
putation “of the actuarial reserve requirements” of the system
and, in a provision reminiscent of its first sentence, looked for
financing to “contributions by the members as above provided
and by contributions by the employer.” Id.

2. The 1968 amendments. In 1968, the Legislature
passed Act 2098, which amended section 718. Act of February
8, 1968, No. 2098, 1968 V.I. Sess. Laws, Pt. I, 9. Act 2098
divided section 718 into subsections, with its first sentence on
“actuarial reserve requirements” becoming subsection (a). Id.
§ 718(a). Act 2098 retained the four-percent employee contri-
bution rate but changed the compensation caps and minima.
See id. § 718(b), (c). It also slightly modified the provision for
annual computation of the system’s actuarial reserve require-
ments. Id. § 718(e). In a gloss on the original language of
subsection (f), Act 2098 provided that “[t]he employer shall
make contributions which together with the members’
contributions and the income of the system will be sufficient to
provide adequate actuarially determined reserve for the
annuities and benefits herein prescribed.” Id. § 718(f). And
for the first time, the employer’s contribution rate was fixed at
a percentage of employee compensation—on a temporal
gradient from 4.00% for the period before July 1, 1968 to
7.63% for the period after July 1, 1971—by the terms of sub-
section (g). Id. § 718(g). Both employer and employee contri-
butions were to be paid into the system each payroll period. Id.
§ 718(h).

3. The 2005 amendments. Relevant amendments were
later adopted when the Legislature passed the Retirement
System Reform Act of 2005. Act of Nov. 2, 2005, No. 6794,
2005 V.I. Sess. Laws 380.

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First, the bill added new subsections to section 704.
That section now provides that “[r]etirement contributions paid
for a prior period, whether by employer or by member, must
be charged a delinquent fee of 1.5% for each calendar month
or part thereof that paid [sic] contributions should have been
paid.” 3 V.I.C. § 704(q). Such delinquent contributions
“include[] prior period contributions due to incorrect wages
and contributions from an earlier report or wages and
contributions that should have been reported, but were not.”
Id. The 1.5 percent “assessment may not be waived,” id.,
unless the GERS administrator in “exceptional circumstances”
grants a waiver—and then, “only once for an employer during
any one fiscal year.” Id. § 704(r).

Second, the 2005 amendments require the accrual of
interest on delinquent contributions to GERS. Under the new
provision, “[w]henever any agency, department[,] instrumen-
tality, or employer fails to make timely contributions, interest
shall accrue on the amount of the contributions not paid based
on the system’s domestic fixed income investment rate of
return not to exceed the rate of 9%.” Id. § 736(b).

Third, the Legislature amended existing provisions of
section 718 by, among other things, adding that “the Board
may actuarially determine the rate of contribution for members
and employers of the system,” id. § 718(a), and that “[t]he
employer and employee contributions must be paid to the
system within ten days after the closing of each payroll
period,” id. § 718(h). The Board, however, “may not increase

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rates, in addition to rates already in effect, by more than 3.0%
over a five-year period.” Id. § 718(b).4

Finally, the 2005 act codified section 734, under which
“[a]ll payments required by this chapter to be made by the
employer to the retirement fund are continuing obligations of
the Government.” Id. § 734. This provision ensures that
“funds owed to the system by the employer should never be
capable of escaping payment due to a statute of limitations.”
V.I. 26th Legis., Bill No. 26-0071, Bill Summary, Section 21.

B. Procedural History

1. The 1981 complaint. Exercising its “power to sue
and be sued in its own name,” GERS filed a complaint in 1981
against the GVI and its Commissioners of Finance in the Dis-
trict Court of the Virgin Islands. Emps. Ret. Sys. of Gov’t of
V.I. v. Quinn, No. 3:81-cv-5 (D.V.I.), Compl. ¶ 2; JA754.5
GERS alleged that the Commissioners had failed to timely re-
mit several pay periods’ worth of employee contributions to
GERS and commingled these funds with the GVI’s. GERS
also alleged that the GVI had failed to timely remit to GERS
“its matching retirement contribution of 11%,” as required by

4
This constraint on GERS’s rate-setting ability resides in the
subsection of the statute on employee contributions. But
GERS seems to understand that it equally applies to the
employer rate. Indeed, GERS’s inability to unilaterally in-
crease the GVI’s required employer contribution percentage is
arguably what makes GERS’s cross-appeal justiciable. We ex-
press no opinion on the scope of GERS’s authority under
section 718(b).
5
Citations preceded by “JA” are to the parties’ Joint Appendix.

‐7-
statute, to the tune of nearly $500,000. 1981 Compl. ¶ 9; see
also id. ¶ 4 (noting GVI’s responsibility “to contribute 11%”
as “the employer”). GERS requested injunctive relief ordering
the Commissioners and the GVI to timely pay GERS all funds
due and owing, preventing the Commissioners from commin-
gling funds, and restraining the GVI “from future withholding
of matching contributions.” Id. at 3. GERS also sought inter-
est of at least 18 percent annually on all funds due and owing,
as well as attorneys’ fees and costs.

2. The 1984 consent judgment. After written and oral
discovery, the parties entered into a consent judgment in 1984.
The judgment acknowledged that the GVI’s Commissioner of
Finance “receives and releases employee and employer retire-
ment contributions.” JA113. So it obligated “defendant,
Commissioner of Finance, [to], within thirty (30) days of each
payroll period, certify and pay into the Employees’ Retirement
System Fund the total amount due of employee and employer
contributions as defined in Title 3, Section 718.” JA113–14.
The judgment recognized that “[a]t this time, the Court does
not have jurisdiction to compel the payment of the legal rate of
interest by the Commissioner of Finance on deliqneunt [sic]
employee and employer contributions.” JA114. But it also
provided that “if an act is established by the Legislature,
authorizing the payment of interest, this Consent Judgment
shall be amended to reflect such change.” Id. A Virgin Islands
assistant attorney general executed the consent judgment on
behalf of all defendants.

3. The 1994 amendment to the consent judgment. In
March 1994, four members of GERS individually filed a fed-
eral lawsuit against GERS, several of its trustees, and the GVI
alleging chiefly that the GVI had been dilatory in making

‐8-
required payments to GERS under the consent judgment. See
Molloy v. Monsanto, Civ. No. 1994-30, 1994 WL 326237, at
*1 (D.V.I. June 9, 1994). Among the motions filed by the
Molloy plaintiffs was a motion to enforce the consent judg-
ment, seeking to require the GVI to remit employee and
employer contributions to GERS within 30 days of each pay-
roll period. Id. That motion, although filed in Molloy, was
“considered as having been filed in the litigation that produced
the consent judgment,” id. at *1 & n.6, and the District Court
denied it without prejudice. Quinn, 1994 WL 326224, at *1
(D.V.I. June 9, 1994) (noting allegation that “the amount of
GERS money in the government’s bank account has increased
more than fifteen fold since December 1984”).

Hoping to remedy these and other issues related to the
consent judgment, GERS and the GVI jointly asked the District
Court to modify it. The modified consent judgment, entered in
April 1994, ordered that a separate interest-bearing bank
account in the name of GERS be created for the Commissioner
to use when depositing employer and employee contributions,
“interest[,] and all other monies received of every kind and
description belonging to the System.” JA316. The parties also
agreed on an auditing process, deposit logistics, and an invest-
ment interest allocation methodology. The provisions of the
1984 consent judgment were otherwise retained. Upon com-
pletion of motions practice, and following conferences with the
District Court, any disagreement between the parties about the
amended consent judgment seemed to have dissipated by late
1994.

4. The tangential 2001 action. In 2001, GERS sued the
Governor of the Virgin Islands, the Legislature, and the GVI
seeking to compel the payment of contributions required under
discrete 1994 legislation that enacted a special early retirement

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incentive program aimed at avoiding layoffs of certain employ-
ees. See, e.g., Gov’t Emps. Ret. Sys. v. Turnbull, 134 F. App’x
498, 500 (3d Cir. May 16, 2005); see also 3 V.I.C. §§ 718c,
718(j). That legislation included a financing mechanism
requiring the GVI to make special quarterly contributions to
GERS to compensate for employee contributions lost because
of the early retirement of incumbent contributors. GERS
alleged that the 1994 legislation and related amendments did
not put in place an adequate financing structure, and thus un-
constitutionally impaired an implied contract between the GVI
and its employees, in violation of Article 1, Section 10 of the
U.S. Constitution.

The District Court in Turnbull dismissed GERS’s com-
plaint, holding that GERS failed to state a cognizable Contracts
Clause claim. Gov’t Emps. Ret. Sys. v. Turnbull, No. 01-cv-69
(D.V.I. Jan. 23, 2004). We affirmed, albeit on ripeness
grounds. We held that GERS “failed to establish a justiciable
case or controversy” because “no GERS members have
suffered any harm” and there was “no evidence in the record
that any GERS members have been denied, or are about to be
denied retirement benefits, or were otherwise injured as a
consequence of the claims alleged.” 134 F. App’x at 501.

5. The 2016 enforcement proceedings. In 2016, GERS
moved to enforce the consent judgment, alleging that the GVI
had violated section 718(f) by failing to fund GERS for the
entire delta between its assets and its liabilities to pensioners.
GERS referred to this supervening obligation, over and above
the fixed-percentage employer contributions spelled out in sec-
tion 718(g), as the GVI’s “actuarially determined employer
contribution” or “ADEC.” JA89–93. Then, in 2017, GERS
moved on an emergency basis to enforce the consent judgment
because, for several months beginning in late 2016, the GVI

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withheld wholesale its employees’ and its own employer fixed-
percentage contributions. GERS filed both enforcement
motions in the 1981 Quinn action, under its case number and
caption. And both motions sought enforcement through a find-
ing that the GVI was in contempt of the consent judgment or,
alternatively, by recourse to the District Court’s “general
equitable powers.” JA293–94; JA515. The GVI ultimately
admitted to the blanket withholding of fixed-percentage
contributions, the District Court found a breach of the consent
judgment, and the GVI then repaid a total of about $36
million—which included principal and interest—by July 2018.

The proceedings next focused on whether what had
occurred was an isolated breach or whether the GVI had failed
to remit fixed-percentage contributions to GERS in any prior
period. GERS’s administrator testified that “missing employer
contributions going back years are still outstanding.” JA1748.
(According to GERS publications, “[t]he issue of prior periods
missing employer contributions” first surfaced with the imple-
mentation of a new computer system in March 2012. JA3055;
JA3082; JA3107.) GERS calculated that the GVI owed over
$72 million in previously missed employer contributions, in-
cluding interest and penalties, through the end of 2017. Based
on a sample population of employees, the GVI claimed that it
owed GERS just a few hundred dollars. Because of the dispar-
ity in the parties’ calculations, the District Court appointed an
independent expert, RSM US LLP (“RSM”), to determine the
extent of the GVI’s arrears for prior periods beginning in 1991
and running through December 31, 2018. The GVI and GERS
each had equal access to RSM’s data and personnel, and equal
obligations to provide records to and cooperate with RSM.

RSM examined all available payroll documents and rec-
ords of contributions to GERS. RSM concluded that the GVI

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had indeed failed to contribute all that was required under the
fixed percentages in force during various payroll periods
dating back as far as 1991.6 Based on detailed records covering
2010–2018, RSM determined that the GVI under-contributed
to GERS during that period by about $4.0–$5.0 million.
According to RSM, these under-contributions stemmed from
clerical, accounting, and processing errors. In a February 5,
2020 order, the District Court adopted RSM’s calculations,
awarded GERS $5.0 million in principal for the GVI’s 2010–
2018 under-contributions, and directed RSM to calculate the
pre-2010 amounts and undertake an interest analysis. The
Court also set a schedule for the parties to brief the appropri-
ateness and amount of interest.

RSM concluded that the under-contributions during the
1991–2009 period were less certain because of gaps in the rel-
evant pay records. The “[m]ost significant[]” impediment to
its obtaining comparable detailed payroll and employment
information for the 1991–2009 calculations was that the GVI
had changed its payroll software at the end of 2009 without
“migrat[ing] detailed historical payroll and employment infor-
mation.” JA4806. Making matters worse, “[t]he [GVI] server
on which [the defunct software’s] data was stored . . . was de-
commissioned and did not receive patching and maintenance
in recent years.” Id. Even so, RSM successfully retrieved
from the decommissioned server annual payroll reports that
included the GVI’s historical determinations of each
employee’s pensionable wages. By subtracting known non-
6
Over the same timeframe, RSM determined—based on data
it characterized as incomplete—that GVI employees also
under-contributed to GERS by some $2.2 million. GERS
elected not to pursue current or former GVI employees to
recover that amount.

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pensionable wages, such as overtime pay, from reported gross
wages, RSM performed its own calculations of pensionable
wages. Applying the statutory contribution percentages to the
GVI’s and to its own pensionable wage determinations yielded
a significant variance between the two as to the GVI’s histori-
cal contribution obligations. Accordingly, RSM went on to
refine its calculations.

RSM began by sampling 20 employees and comparing
the GVI’s and its own calculation of each employee’s pension-
able wages with their salary information as documented in
Notices of Personnel Action (“NOPAs”), which the GVI gen-
erates based on changes in an employee’s pay or employment
status. This comparison led RSM to assume that the GVI had
properly calculated an employee’s pensionable wages when-
ever its calculation was greater than 60 percent of RSM’s own
initial calculation. RSM thus adopted the GVI’s calculations
in every such instance across the entire set of raw pensionable
wage data from 1991–2009, amounting in toto to 83 percent of
the data inputs to RSM’s findings for that period.

But for the remaining 17 percent, RSM’s and the GVI’s
pensionable wage calculations varied more significantly. RSM
analyzed available payroll records for the 97 employees with
the largest variance, requesting historical personnel records,
including information relating to annual salaries, from both the
GVI and GERS. It estimated an expected pensionable wage
amount for these employees by using NOPAs, when available,
and, when those were unavailable, GERS’s annual benefit
summaries. But this methodology accounted for only about 12
percent of the high-variance problem. For the remaining 88
percent of the high-variance data, which “likely erroneously
include[d] certain non-pensionable wage types,” RSM reduced
its own pensionable wage calculations by a ratio derived from

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a sample of 75 employees for whom there was “sufficient sup-
porting documentation”—the average ratio between their
document-supported pensionable wages and RSM’s own ini-
tial pensionable wage calculations. JA4815–16. RSM then
relied on both of its sets of adjusted pensionable wage
calculations.

Using this methodology, RSM determined with 95 per-
cent confidence that the GVI’s 1991–2009 under-contributions
fell within an interval from about $11.6 million to $15.8
million. The District Court chose the statistical midpoint of
this range and, in an April 3, 2020 order, awarded GERS
$13,860,879 (hereinafter rounded to $13.9 million) in
principal.

In calculating interest and fees, RSM applied the 2005
interest and delinquency-fee statutes to the balance of under-
contributions the GVI accumulated before the statutes’
effective date and, alternatively, only to contributions the GVI
missed on or after that date. In its April 3 order, the District
Court adopted the former calculation and awarded GERS
$43,161,354 (hereinafter rounded to $43.1 million) in interest
and penalties on the GVI’s $13.9 million in under-
contributions from 1991–2009. Based on RSM’s calculations,
the Court also awarded GERS $6,121,273 (hereinafter rounded
to $6.1 million) in interest and delinquency fees on the $5
million in principal for the 2010–2018 under-contributions.
The District Court’s award to GERS for all the GVI’s under-
contributions from 1991–2018, inclusive of interest and penal-
ties, totaled about $68 million.

Finally, the District Court granted judgment to the GVI
on GERS’s motion to enforce the consent judgment with
respect to the ADEC obligation. The Court reasoned that the

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consent judgment, which obligated the GVI to make its
employer contributions to GERS within 30 days of each
payroll period, conflicted with GERS’s proffered ADEC
obligation, which would obligate the GVI to fund GERS in
accordance with the annual actuarial analysis ordered by the
Retirement Code.

The GVI appealed the District Court’s award of princi-
pal and interest, and GERS appealed the District Court’s denial
of its motion to enforce the consent judgment as to the alleged
ADEC obligation.

II. JURISDICTION AND STANDARD OF REVIEW

We have jurisdiction to review the District Court’s
February 5, 2020 and April 3, 2020 orders under 28 U.S.C.
§ 1291.7 The District Court had jurisdiction over GERS’s orig-
inal 1981 action under Section 22 of the Virgin Islands Revised
Organic Act of 1954. 48 U.S.C. § 1612. Its jurisdiction to hear
GERS’s motion to enforce stems from United States Public

7
The February 5, 2020 order awarding GERS principal for the
2010–2018 period was not listed in the GVI’s Notice of Ap-
peal. Federal Rule of Appellate Procedure 3(c)(1)(B) requires
that the Notice “designate the judgment, order, or part thereof
being appealed.” That said, we liberally construe the require-
ments of Rule 3(c). Pacitti v. Macy’s, 193 F.3d 766, 776 (3d
Cir. 1999). “[W]hen an appellant gives notice that he is
appealing from a final order, failing to refer specifically to ear-
lier orders disposing of other claims . . . does not preclude us
from reviewing those orders.” Shea v. Smith, 966 F.2d 127,
129 (3d Cir. 1992) (citation omitted). When, as here, there is
a connection between the specified and unspecified orders,
review is appropriate. Pacitti, 193 F.3d at 777.

‐15-
Law No. 98-454, 98 Stat. 1732, 1738, sec. 703(b) (codified at
48 U.S.C. § 1612 note (Jurisdiction of District Court Over
Pending Cases)).

We review the District Court’s interpretation and con-
struction of the consent judgment de novo. Holland v. N.J.
Dept. of Corr., 246 F.3d 267, 277–78 (3d Cir. 2001). We also
review statutory constructions de novo. United States v.
Hodge, 948 F.3d 160, 162 (3d Cir. 2020). We review any
mixed questions of fact and law de novo insofar as “the pri-
mary facts are undisputed and only ultimate inferences and
legal consequences are in contention.” U.S. Gypsum Co. v.
Schiavo Bros., Inc., 668 F.2d 172, 176 (3d Cir. 1981). But
when the mixed questions require a district court to make case-
specific factual conclusions, our review is deferential—
examining the record for clear error. See U.S. Bank Nat’l Ass’n
ex rel. CWCapital Asset Mgmt. LLC v. Village at Lakeridge,
LLC, 138 S. Ct. 960, 967–69 (2018).

Interpreting an issue of Virgin Islands law that the Vir-
gin Islands Supreme Court has not ruled on requires us to
“predict how [that court] would decide” the matter. Edwards
v. HOVENSA, LLC, 497 F.3d 355, 361 n.3 (3d Cir. 2007).

III. THE GVI’S APPEAL

The GVI raises a hodgepodge of objections to the Dis-
trict Court’s judgment for GERS on the issue of historical
under-contributions. The challenges can be sorted into attacks
on the District Court’s (A) award of $18.9 million in principal
to GERS and (B) enhancement of that principal with $49.2 mil-
lion in interest and fees. We will affirm the District Court’s
award of $18.9 million in principal to GERS. We will also
affirm its award of $6.1 million in interest and fees for the

‐16-
2010–2018 period. But the District Court erred by applying
the interest and delinquency fee statutes to enhance arrears that
the GVI accumulated before those statutes’ effective date. We
will therefore vacate the $43.1 million enhancement for the
1991–2009 period and remand with instructions.

A. Principal Award to GERS

The GVI contends that (1) its under-contributions to
GERS from 1991–2018 are beyond the scope of the consent
judgment; (2) the issue of whether it under-contributed to
GERS was not properly before the District Court; (3) certain
of its direct contributions to GERS and the process of “truing
up” contributions at the time of an employee’s retirement offset
the $18.9 million award; and (4) the portion of the award cover-
ing the 1991–2009 period rests on unreliable data.

There is no merit to any of the GVI’s arguments.

1. The historical under-contributions fall within the
consent judgment. The GVI argues that the consent judgment
was limited to requiring timely biweekly contributions to
GERS. This was different in kind, the GVI claims, from failing
to remit all funds that have since been determined were
required under the percentages set by statute. But the GVI’s
argument conflicts with the text of the consent judgment and
section 718, both of which require mathematical accuracy.

That the “biweekly contributions were correct when
made and later circumstances may have required an increased
contribution,” Appellants’ Reply Br. 6, is beside the point
because the consent judgment and statute are formulaic. A
consent decree is interpreted as a contract, with its scope “dis-
cerned within its four corners, and not by reference to what

‐17-
might satisfy the purposes of one of the parties to it.”
Firefighters Local Union No. 1784 v. Stotts, 467 U.S. 561, 574
(1984) (quoting United States v. Armour & Co., 402 U.S. 673,
681–82 (1971)). Under the consent judgment, the GVI must
pay GERS “the total amount due of employee and employer
contributions as defined in Title 3, Section 718.” JA113–14
(emphasis added). Section 718 in turn sets forth, first, the
fixed-percentage framework for deducting employee contribu-
tions from paychecks. 3 V.I.C. § 718(b), (d). It then requires
“[t]he employer” to “contribute” to GERS in “an amount paid
upon a percentage of employees[’] compensation” after each
pay date, and specifies certain percentages and dates of
increase. Id. § 718(g); see also id. § 718(h). A straightforward
reading brooks no argument that funds demanded by the statu-
tory percentages are unrecoverable if inadvertently withheld,
whether due to clerical errors or other circumstances. The Re-
tirement Code prohibits both the employer’s intentional
“refusal” and unintentional “failure” to pay. See id. § 736(a)
(“Neither the government nor any agency, department, or
instrumentality may fail or refuse to pay the employer’s con-
tribution required by this chapter within the applicable time
limitation.” (emphases added)); accord id. § 704(s); see also
id. § 704(q) (classifying as “delinquent” and subject to
enhancement “prior period contributions due to incorrect
wages” (emphasis added)).

Granted, a consent decree’s reach is limited by “the gen-
eral scope of the case made by the pleadings.” Sansom Comm.
by Cook v. Lynn, 735 F.2d 1535, 1538 (3d Cir. 1984) (quota-
tion omitted). But GERS’s 1981 complaint made the case that
the GVI had failed to contribute the full amount that was
required of it as employer. See, e.g., 1981 Compl. ¶¶ 4, 9
(alleging that GVI failed to timely remit to GERS “its matching

‐18-
retirement contribution of 11%” as “the employer”). And it
sought an order compelling the GVI to pay all funds due and
owing, including the withheld employer contributions, as well
as restraining the GVI “from future withholding of matching
contributions.” Id. at 3. So the general scope of GERS’s orig-
inal complaint jibes with the dictates of both the consent decree
and section 718. And even assuming some dissonance
between the allegations in the 1981 complaint and the GVI’s
under-contributions here, we are loath to slice and dice them in
order to depart from a plain reading of the consent judgment—
particularly given the vintage of most of the relevant facts. See,
e.g., Harris v. City of Philadelphia, 137 F.3d 209, 212 (3d Cir.
1998) (noting that a court should not “strain the decree’s pre-
cise terms or impose other terms in an attempt to reconcile the
decree with [the court’s] own conception of its purpose”).

We thus conclude that the consent judgment obligated
the GVI to make the under-contributions that were the subject
of the District Court’s award of principal.

2. The GVI’s historical under-contributions were
properly before the District Court. The GVI raises the corol-
lary argument that its liability for historical under-
contributions to GERS was not properly before the District
Court. To be sure, GERS’s enforcement motions that spawned
the District Court’s evidentiary hearings sought first to impose
the so-called ADEC obligation at issue in the cross-appeal, and
then to recover contributions that the GVI had intentionally
refused to pay GERS beginning in late 2016. In the latter
motion, GERS alleged that the GVI stopped timely and fully
paying fixed-percentage contributions in 2016 and into 2017,
and attached a sworn affidavit from the GERS administrator to
support those factual allegations. But GERS did not, in these
motions, claim a systemic “unintentional” breach redolent of

‐19-
the GVI’s legacy under-contributions, nor did it seek fixed-
percentage deficiencies stretching back decades. That said, we
are not troubled by the absence of this issue from either the
enforcement motions or the initial proceedings.

First, we cannot say that the District Court clearly erred
by concluding that the GVI’s historical under-contributions
were systemically intertwined with the breaches GERS
asserted. Based on GERS’s motions, the District Court
received evidence from both sides about the extent of the
GVI’s unpaid liabilities. The District Court then heard testi-
mony about the GVI’s various instances of nonpayment over
the years, amid the backdrop of GERS’s litigation against the
GVI for unpaid contributions in the 1980s, 1990s, and 2000s.
After hearing the GVI’s argument that “the indispensable pred-
icate” to GERS’s recovery of missing prior-period contribu-
tions was “some sort of supplemental pleading” or “motion that
lays [it] out,” the District Court ruled that nothing “precludes a
court from undertaking its own inquiry to determine . . . the
depth and breath [sic] of th[e] breach” that “a party points
out.”8 JA3451–71 (“[A] party certainly doesn’t take the role

8
The award to GERS of the GVI’s contribution deficiencies
for the 1991–2018 period did not come with an express written
conclusion that the GVI breached the consent judgment. The
GVI raises this as part of its argument against expanding the
scope of GERS’s claims to embrace the historical under-
contributions. But the District Court made relevant findings
and a ruling of breach on this specific issue. For example, at a
November 2018 hearing, before instructing the parties to pre-
sent evidence to value the 1991–2018 missing fixed-rate
contributions, the District Court stated:

‐20-
of the Court into its hands when it makes suggestions.”).
Hence the Court’s appointment of RSM, the third-party expert,
to examine the parties’ records and opine on the full range of
the GVI’s arrears. Before RSM released its first report, the
Court concluded that the GVI’s intentional withholding of con-
tributions beginning in late 2016 was only a “snapshot in time”
of a larger “systemic failure to pay what is due and owing,
which systemic failure [has] require[d] the Court to intervene
on one, two, and multiple occasions [in the 1980s and 1990s].”
JA3774–76.

When a district court “takes a raft of case-specific
historical facts, considers them as a whole, balances them one
against another,” and makes a legal conclusion consisting “pri-
marily” of “factual work,” appellate courts should review that
conclusion only for clear error. U.S. Bank Nat’l Ass’n, 138 S.

Right now the evidence that has been largely pre-
sented by the GERS or by the Government of the
Virgin Islands suggests that there is, one, a
breach; and two, there is an amount that needs to
be determined as to the depth and breadth of that
breach. So if the Government wishes the Court
to consider any other evidence that hasn’t al-
ready been provided in the record, then the Gov-
ernment needs to present that sooner rather than
later. I think we’ve covered this issue about the
breach. . . . The breach needs to be closed.

JA1969. To take another example, the Court expressed at a
subsequent hearing that “the government failed to meet its
obligations to make payments on behalf of the employees and
the employers,” a “deficiency [that] needs to be remedied in
short order.” JA2970–71.

‐21-
Ct. at 967–68 (reserving for de novo review situations where
“applying the law involves developing auxiliary legal princi-
ples of use in other cases”). That is precisely what the District
Court did in concluding that the GVI’s under-contributions
stretching back to 1991 were systemically related to the initial
ADEC and 2016 alleged breaches at the heart of GERS’s
enforcement motions.9 We decline to disturb the District
Court’s conclusion, which was based on the consent judgment,
GERS’s allegations, and decades of legal and factual develop-
ment—all of which are memorialized, but only partially, in
6,000-odd pages of appendix that the parties have submitted on
appeal. Simply describing the District Court’s inquiry “indi-
cate[s] where it (primarily) belongs: in the court that has pre-
sided over the presentation of evidence, that has heard all the
witnesses, and that has both the closest and the deepest under-
standing of the record.” Id. at 968; see also Manning v. Energy
Conversion Devices, Inc., 13 F.3d 606, 607 (2d Cir. 1994)
(affirming district court order and rejecting argument that it
“improperly expand[ed] the scope of the settlement agreement
because . . . . district court’s factual finding as to what [was]
meant by the term ‘parties’ was not clearly erroneous”).

Even were we to second-guess the District Court’s con-
clusion that the breach GERS alleged was a snapshot of the
breach later borne out by the evidence, we would still uphold
inclusion of the GVI’s legacy under-contributions in the litiga-
tion. If a claim, though never pleaded, is tried by express or

9
Our reluctance to hold that the District Court could not chart
this course finds support in a district judge’s ability to issue
civil contempt sanctions sua sponte after giving the contemnor
notice and an opportunity to be heard. See, e.g., Carty v.
Turnbull, 144 F. Supp. 2d 395, 396 (D.V.I. 2001).

‐22-
implied consent of the parties, the pleadings may be deemed to
conform even after judgment or on appeal.10 Schultz v. Cally,
528 F.2d 470, 474 (3d Cir. 1975) (citation omitted); see also
Fed. R. Civ. P. 15(b)(2). Determining whether an issue was
litigated by implied consent requires balancing three factors:
whether the parties recognized that the unpleaded issue entered
the case, whether the evidence supporting it was introduced

10
The operative filings animating this round of proceedings
were GERS’s enforcement motions. Those motions are, strict-
ly speaking, not pleadings within the meaning of Federal Rules
of Civil Procedure 7 and 10. But in the context of enforcing
the decades-old consent judgment based on a live complaint,
GERS’s contempt motions setting forth allegations of breach
are, in substance, pleadings. See, e.g., Pleading, BLACK’S LAW
DICTIONARY (11th ed. 2019) (“[a] formal document in which
a party to a legal procedure (esp. a civil lawsuit) sets forth or
responds to allegations”). The parties shared this understand-
ing in the District Court. For example, the GVI in its briefs
referred to “the motion to enforce the Consent Judgment (Doc.
#2)” as “essentially the operative pleading in this litigation.”
JA2463 (also describing what GERS “alleged” therein). And
when counsel for the GVI argued that GERS needed to “plead”
the issue of historical under-contributions, the District Court
asked, “When you say ‘plead,’ do you mean a complaint?”
Counsel responded: “Well, we’re in the motion-to-enforce
stage. But a motion that lays out [the under-contributions].
There certainly is no motion in the court’s file that says any-
thing like that, let us respond, let us take the discovery and
we’ll try it.” JA3454–57. Our holding on this point is limited
to the particular facts of this case and should not be taken to
mean that garden-variety motions are “pleadings” that can be
conformed to evidence via Rule 15.

‐23-
without objection, and whether a finding of consent prejudiced
the opposing party’s opportunity to respond. Douglas v.
Owens, 50 F.3d 1226, 1236 (3d Cir. 1995) (citations omitted).
The prejudice factor is the touchstone for granting leave to
amend under Federal Rule of Civil Procedure 15(b). See
United States v. Hougham, 364 U.S. 310, 316–17 (1960).

It is difficult to imagine how it could have been any
clearer to the parties that a new theory of breach entered the
case by, at the latest, November 2018. The issue of the GVI’s
historical under-contributions was expressly raised for the first
time at a hearing on September 27, 2018, when the Court ques-
tioned the GVI’s counsel for several minutes about this new
variant of the original contempt issue. Then, on November 26,
2018, the Court again inquired about the issue with GVI
counsel before hearing relevant testimony from GERS’s ad-
ministrator, and then instructed the GVI to respond to GERS’s
proffered under-contribution calculations. The Court reiter-
ated in an order several days later that the GVI was to respond
specifically to the witness’s report summarizing these missing
contributions. (The GVI’s legacy under-contributions came to
be called missed “prior-period” contributions, distinguishing
them from the more current deficiencies first adjudicated in the
proceedings.) Thereafter, so many hearings and briefing op-
portunities proliferated that it would be a waste of paper and
ink for us to recount them all here. Evidentiary hearings tar-
geted to this issue occurred in February, March, and May 2019,
after which the Court appointed the third-party expert to deter-
mine the amount of the GVI’s historical under-contributions.
RSM then issued two reports in 2020, one each for 1991–2009
and 2010–2018, with attendant opportunities afforded both
parties to furnish evidence, object to RSM’s methodology,
examine and cross-examine a representative of RSM, and

‐24-
argue related matters of law to the Court. The first factor thus
strongly favors a determination that the parties litigated the
issue of the GVI’s under-contributions by implied consent.11

Nor was there prejudice to the GVI. Though it opposed
introduction of its legacy under-contributions into the case, the
GVI fully litigated the issue in the above-mentioned eviden-
tiary hearings, status conferences, and papers across the span
of nearly two years. The GVI was hardly “denied a fair oppor-
tunity to defend and to offer additional evidence on th[e]
different theory.” Evans Prods. Co. v. W. Am. Ins. Co., 736
F.2d 920, 924 (3d Cir. 1984) (prejudice where “the [new] the-

11
Notwithstanding Rule 15’s ostensible requirement of a
“trial,” pleadings may be deemed amended to conform to the
evidence presented at hearings before a district judge. For ex-
ample, in the context of habeas corpus proceedings, the
Supreme Court of the United States “see[s] no reason why an
evidentiary hearing should not [equate with a trial for Rule
15(b) purposes] so long as the [State] gave any sort of consent
and had a full and fair opportunity to present evidence bearing
on the claim’s resolution.” Banks v. Dretke, 540 U.S. 668,
704–05 (2004) (cleaned up). We, too, see no reason why the
evidentiary hearings preceding the District Court’s entry of
judgment in this matter should not equate with a “trial” under
Rule 15(b). Nor, seemingly, did the GVI. After the District
Court noted that “in an enforcement it’s a breach of a court
order and it’s a little bit different . . . than a trial on the merits,”
counsel for the GVI agreed: “when I say a trial [I mean] an
adversarial proceeding in which after the parties have taken
discovery we can try the questions that Your Honor has identi-
fied.” JA3456–57 (emphasis added). That is what occurred
below, and no party suggests otherwise.

‐25-
ory . . . had not been squarely presented and litigated at any
stage of the proceedings”); see also Douglas, 50 F.3d at 1236
(severe prejudice where implied amendment “allowed the jury
to consider another theory of liability against Griffith without
Griffith having had the opportunity to defend against this new
claim”). We cannot conceive of anything the GVI might have
done differently had its historical missed contributions been lit-
igated in some other fashion.

We also glean from the extensive record before us no
prejudice to the GVI’s ability to assert legal defenses. Though
the GVI could have sought to raise the statute of limitations
against GERS in a separate action, we think it unlikely that any
portion of such a case would have been time-barred. To begin
with, by “continuing” the GVI’s contribution obligations in-
definitely, section 734 of the Retirement Code effectively
defeats any statute-of-limitations defense at least for deficien-
cies incurred on or after its effective date in 2005.12 At all
events, Virgin Islands law prescribes a 20-year statute of limi-
tations on actions to enforce a federal court judgment. 5 V.I.C.
§ 31(1)(B).13 In view of the discovery rule, which we have

12
We express no opinion on whether section 734 was intended
to apply retroactively.
13
Other courts have held that enforcement of consent decrees
is subject only to equitable defenses—not legal defenses such
as the statute of limitations. See, e.g., Bergmann v. Mich. State
Transp. Comm’n, 665 F.3d 681, 683–84 (6th Cir. 2011);
Brennan v. Nassau Cnty., 352 F.3d 60, 62–63 (2d Cir. 2003);
see also Cook v. City of Chicago, 192 F.3d 693, 695 (7th Cir.
1999) (Posner, C.J.) (holding that consent decrees are contracts

‐26-
applied in Virgin Islands cases “when the injury or its cause is
not immediately evident to the victim,” Joseph v. Hess Oil, 867
F.2d 179, 182 (3d Cir. 1989); accord MRL Dev. I, LLC v.
Whitecap Inv. Corp., 823 F.3d 195, 202 (3d Cir. 2016), GERS
could have brought a timely separate action for all the 1991–
2018 under-contributions it recovered in these proceedings.14
The parties agree that GERS did not discover the historical

from interpretive standpoint but equitable decrees from reme-
dial standpoint “and therefore [are] subject to the usual equita-
ble defenses”). We take Virgin Islands law at face value, with-
out deciding whether to follow these other Circuits’ approach.
14
The Legislature exercised its power under the 1984 amend-
ments to the Revised Organic Act of 1954, 48 U.S.C. § 1612,
to vest the territorial courts (now the Virgin Islands Superior
Court) with “original jurisdiction in all [local] civil actions
regardless of the amount in controversy.” 4 V.I.C. § 76(a);
Callwood v. Enos, 230 F.3d 627, 631 (3d Cir. 2000). As the
GVI concedes, the District Court of the Virgin Islands retained
jurisdiction to enforce the consent judgment because the origi-
nal action was “pending before the district court as of October
1, 1991, the effective date of the Virgin Island[s] Legislature’s
implementing legislation.” Isidor Paiewonsky Assocs., Inc. v.
Sharp Props., Inc., 998 F.2d 145, 153 (3d Cir. 1993). Though
we do not believe any of GERS’s claims “go far beyond the
Consent Judgment’s scope,” regardless, it would not have been
“unfair in the extreme to allow GERS to . . . invoke[e] the dis-
trict court’s long-defunct local jurisdiction” over such claims.
Appellants’ Br. 48. The GVI makes no argument that a terri-
torial court would have afforded it more procedural or substan-
tive rights, or reached a different conclusion in applying Virgin
Islands law, than did the District Court.

‐27-
under-contributions until it implemented a new computer
system in March 2012, and the issue was first testified to by a
witness and taken up by the Court in these proceedings in
September 2018. Until that time, it appears that the GVI was
also unaware, and it has not argued that GERS’s failure to
discover the missed contributions sooner was unreasonable.
So even if GERS’s motions did not fairly implicate the GVI’s
legacy under-contributions, conforming the allegations to the
claims litigated would not deprive the GVI of otherwise avail-
able legal defenses.

In sum, the District Court did not clearly err by resolv-
ing factbound mixed questions in favor of adjudicating the
GVI’s historical under-contributions as part of the breach that
GERS alleged in its enforcement motions. Accordingly, the
GVI suffered no prejudice from inclusion of that issue in the
case and, in fact, fully litigated it.

3. Direct contributions to GERS and the true-up
process do not offset the award. Next, the GVI urges that the
District Court’s $18.9 million judgment to GERS should be
offset by the GVI’s “direct contributions to GERS” of some
$24 million since the beginning of 2015. Appellants’ Br. 37–
38. Relatedly, the GVI argues for an offset because the parties
agreed to some sort of “settlement” under which GERS would
reconcile the GVI’s actual and required contributions for each
employee upon the employee’s retirement. See Appellants’
Reply Br. 5–7, 12–13; see also Appellants’ Br. 16–17, 26–27.
These arguments miss the mark.

Evidence the GVI cites as supporting its direct contri-
bution argument shows that amounts are appropriated, in the
sum of $7 million annually beginning in the fiscal year ending

‐28-
September 30, 2013, from the “Internal Revenue Matching
Fund” to GERS. Act of July 5, 2011, No. 7261, § 13, 2011
V.I. Sess. Laws 84, 92; JA3108 (discussing Act 7261). This
annual direct contribution requirement flows from separate
legislation and does not speak of the GVI’s contributions as
employer. Nor does it suggest any relationship to the GVI’s
obligations to GERS under section 718.15 E.g., Act 7261, § 13
(providing for contribution “[n]otwithstanding any law or pro-
vision to the contrary”). The GVI’s partial fulfillment of an
annual fixed-sum contribution requirement does not entitle it
to offset distinct contributions it owes GERS as percentages of
employee compensation.16

Whether the true-up reconciliation process for retiring
employees conceptually ensures no under-contributions, as the
GVI argues, is beside the point. For starters, the “settlement
agreement” to which the GVI attributes the true-up process is
not in the record. All we can surmise is that, after discovering
the under-contributions, the parties agreed to reconcile the
GVI’s actual and required contributions associated with an
employee upon her retirement.17 We see no evidence that this

15
For the same reasons, the District Court’s award is not an
“unlawful sanction,” as the GVI urges. Appellants’ Br. 38–39.
16
GERS reported on August 11, 2020, that it had “received $42
million [of the $56 million due] from the Internal Revenue
Matching Fund under Act No. 7261.” GVI’s Suppl. App. at 5.
17
We have also found oblique references in the record to
GERS’s unsuccessful attempts as of October 2013 to negotiate
a settlement agreement for the prior ten months of missing

‐29-
arrangement was intended to modify the GVI’s obligations
under the consent judgment, which would have required court
approval. See, e.g., United States v. Am. Cyanamid Co., 719
F.2d 558, 565 (2d Cir. 1983). What’s more, the true-up process
is a relatively recent phenomenon that could not cure the GVI’s
under-contributions linked to employees who retired prior to
its implementation. And RSM’s examination of a “test sample
population” led it to conclude that “members who had retired”
under the true-up process “were not part of the GERS Claim
calc[ulation].”18 JA3733. The true ups sampled were all for
“employees [who] were not part of the GERS Claim, which
suggests that they were retired or moved.” JA3752. Nor do
the equities support GERS forgoing contributions and associ-
ated investment returns to which it is entitled until an employee
retires. As the District Court put it, “I don’t think the [1981]
Complaint was just talking about people who were applying to
retire.” JA1914. So the District Court could have reasonably
concluded that none of the funds paid to reconcile contribu-

employer contributions, and to an unexecuted settlement
agreement dealing with missing employer contributions from
October 1, 2010 through December 31, 2012. These settlement
efforts do not support the GVI’s argument and suggest instead
that out-of-court resolution of GERS’s claims has persistently
eluded the parties.
18
In excluding true-up payments, RSM’s 2010–2018 report
noted that “review of [true-up] information provided to date
has seemingly all related to employees outside the scope of the
GERS claim,” though the expert did “not receive[] a complete
record of payments by the GVI to GERS for end-of-
employment GERS settlements.” JA4048.

‐30-
tions associated with employees who retired after institution of
the true-up arrangement should have been deducted from the
award to GERS.

4. The expert reliably calculated the $18.9 million in
principal. The GVI contends that the portion of RSM’s
analysis calculating 1991–2009 under-contributions turned on
unreliable data because NOPAs imperfectly capture total com-
pensation paid to a particular employee. RSM recognized as
much in declining to rely on NOPAs for the 2010–2018
period.19 But it did choose to rely on them in part to calculate
under-contributions from 1991–2009 because of the dearth of
other competent records. The GVI thus seems to contend that
this portion of the expert’s analysis flunked the reliability
prong of Daubert v. Merrell Dow Pharm., Inc., 509 U.S. 579
(1993)—yet without citing that landmark precedent.

The GVI made this argument to the District Court, to no
avail. We agree with the Court’s finding that RSM’s 1991–
2009 methodology, described above in Section I.B.5, mitigated
the problems of relying exclusively on NOPAs by benchmark-
ing NOPA data against other sources of information, such as
an employee’s actual gross wages. And based on a sample of
10 employees with both NOPAs and GERS annual benefit
summaries, RSM determined that the salary reported on
GERS’s records was, on average, within four percent of that
reflected in the GVI’s records. Finally, the GVI’s embrace of
19
The expert observed two types of inaccuracies associated
with GERS’s reliance solely on NOPAs to calculate what the
GVI owed in 2010–2018 under-contributions: “a) employees
[sic] actual hours worked may differ from hours contemplated
in NOPAs, and b) employee’s [sic] actual start and end dates
may differ from dates included within NOPAs.” JA4050–51.

‐31-
the true-up process, with its substantial reliance on NOPAs,
undermines its objection. Particularly when a defendant’s poor
recordkeeping confounds data inputs, as was the case here,
“absolute certainty” in expert opinions is not required. Dodge
v. Cotter Corp., 328 F.3d 1212, 1222 (10th Cir. 2003); see also
Klein-Becker USA, LLC v. Englert, 711 F.3d 1153, 1163 (10th
Cir. 2013) (“Although plaintiffs must generally establish dam-
ages with specificity, some estimation is acceptable if necessi-
tated in part by the Defendants’ poor record keeping.” (cleaned
up)); cf. Anderson v. Mt. Clemens Pottery Co., 328 U.S. 680,
687–88 (1946) (articulating FLSA damages burden-shifting
framework “where the employer’s records are inaccurate or
inadequate”); Reich v. Gateway Press, Inc., 13 F.3d 685, 701
(3d Cir. 1994) (“If the employer fails to produce accurate
records about the employee’s wages and hours, the court may
then award damages . . . even though the result may only be
approximate.” (citing Mt. Clemens, 328 U.S. at 687–88)).

We thus have no basis to conclude that the District
Court abused its discretion in admitting the expert testimony.
See In re Paoli R.R. Yard PCB Litig., 35 F.3d 717, 749 (3d Cir.
1994).

* * *

Seeing no merit to any of the GVI’s challenges to the
District Court’s award of principal, we will affirm the judg-
ment insofar as it awards GERS $13.9 million for the 1991–
2009 period and $5 million for the 2010–2018 period.

B. Award of Fees and Interest to GERS

The GVI’s second set of arguments goes to the District
Court’s $49.2 million award of interest and delinquency fees.

‐32-
Although there was no statutory authority in 1984 on which
these enhancements could be based, the consent judgment pro-
vided that it “shall be amended” if Virgin Islands law later
authorized interest on delinquent contributions. JA114. Two
statutes enacted in 2005 did just that: one imposing a 1.5 per-
cent delinquency fee “for each calendar month or part thereof
that paid [sic] contributions should have been paid,” 3 V.I.C.
§ 704(q)–(r), and the other requiring interest “not to exceed the
rate of 9%” on contributions not timely paid to GERS. Id.
§ 736(b). The District Court adopted a set of the expert’s
calculations that applied the two statutes to the GVI’s accumu-
lated arrears as of the statutes’ effective date and to all its
under-contributions after that date.

The GVI contends that the District Court improperly
applied both statutes, and in three ways. First, the GVI argues
that the statutes apply only to the failure to timely make bi-
weekly contributions and not to the failures responsible for its
under-contributions. Second, the GVI contends that the Dis-
trict Court applied them retroactively to contributions missed
before their effective date, without the necessary legislative
intent. Third, the GVI asserts that interest and fees on most of
the under-contributions cannot be recovered due to the statute
of limitations or laches. We address each of these arguments
in turn, and see merit in only the second.

1. The statutes are not intended only for willful miscon-
duct. The GVI maintains that the District Court should not
have enhanced the $18.9 million with interest and delinquency
fees because the GVI “timely made” employer contributions,
which only later turned out to be insufficient, and because its
under-contributions to GERS were not willful. Appellants’ Br.
44, 48–52. But neither statute carries a scienter requirement;
each speaks only of the unmodified failure to contribute. See

‐33-
3 V.I.C. § 704(q) (imposing delinquency fee when “contribu-
tions should have been paid”); id. § 736(b) (triggering interest
when “employer fails to make timely contributions”). In fact,
the delinquency-fee statute seems to embrace non-willful
conduct such as deficient “prior period contributions due to
incorrect wages.” Id. § 704(q) (emphasis added). The
scienter-free focus of the two statutes jibes with other relevant
provisions of the Retirement Code that proscribe both the
“refus[al] to pay,” which suggests an intentional act, and the
mere “fail[ure] . . . to pay.” Id. § 736(a). We typically refrain
from reading into statutes words that plainly aren’t there,
Romag Fasteners, Inc. v. Fossil, Inc., 140 S. Ct. 1492, 1495
(2020), and we refuse to do so here. Nor must a party show
willfulness to enforce a court order. Harley-Davidson, Inc. v.
Morris, 19 F.3d 142, 148 (3d Cir. 1994).

At all events, the District Court lacked authority to
waive the interest and delinquency fees. For its part, the
delinquency-fee statute applies necessarily (“must be
charged”), subject only to the GERS administrator’s granting
a waiver in “exceptional circumstances beyond the employer’s
control.” Id. § 704(q)–(r). Plainly, no waiver was granted
here. The GVI cites no case authorizing a court to substitute
for the GERS administrator in the waiver process, and author-
ity from other contexts weakens that argument. See, e.g.,
United States v. Lauersen, 648 F.3d 115, 116–18 (2d Cir. 2011)
(per curiam) (holding that district court properly interpreted 18
U.S.C. § 3612(h) as authorizing only Attorney General, and not
district courts, to waive all or part of delinquency and default
penalties), cert. denied, 565 U.S. 959 (2011); 18 U.S.C.
§ 3612(h) (“The Attorney General may waive all or part of any
interest or penalty under this section . . . if, as determined by

‐34-
the Attorney General, reasonable efforts to collect the interest
or penalty are not likely to be effective.”).

The interest statute is also mandatory but, unlike the fee
statute, provides no mechanism for waiver. Given the limited
circumstances enumerated for delinquency-fee waivers, the
interest statute’s conspicuous lack of any comparable provision
means that no waiver at all will be allowed. In short, a district
court is not free to waive interest. See Lauersen, 648 F.3d at
116–17 (concluding that Congress did not implicitly grant
waiver authority to district courts when, in other subsections of
statute, it “explicitly detailed the circumstances under
which . . . penalties could be waived”); cf. Elkins v. Moreno,
435 U.S. 647, 665–66 (1978) (characterizing absence of
restriction in one part of statute as “pregnant” when contrasted
with other parts of statute, which included that restriction).

The GVI’s conduct was therefore subject to both
interest and delinquency fees, and the District Court did not err
in refusing to waive them.

2. The District Court erred by applying the statutes
retroactively. The GVI next contends that the District Court
should not have imposed interest and delinquency fees on
under-contributions that the GVI accumulated before the
interest and fee statutes’ effective date: November 2, 2005.20

20
Although in 1984 it could not “compel the payment of the
legal rate of interest . . . on deliqneunt [sic] employee and em-
ployer contributions,” the consent judgment provided that “if
an act is established by the Legislature, authorizing the pay-
ment of interest, this Consent Judgment shall be amended to
reflect such change.” JA114. One might ask whether GERS’s

‐35-
failure to seek modification of the consent judgment in the
wake of the new interest and delinquency-fee statutes fore-
closes its recovery of interest and fees. A cursory Reply brief
mention aside, the GVI developed no argument for why the
“shall be amended” language obligated GERS to file a motion
to modify the consent judgment. The GVI’s lone acknowledg-
ment that “the Consent Judgment never was amended to
include interest,” Appellants’ Reply Br. 10, suggests that the
GVI forfeited this argument. See, e.g., N.J. Dep’t of Env’t
Prot. v. Am. Thermoplastics Corp., 974 F.3d 486, 492 n.2 (3d
Cir. 2020) (holding that “argument . . . vaguely presented with-
out legal or factual support . . . is forfeited”); Barna v. Bd. of
Sch. Dirs., 877 F.3d 136, 146 (3d Cir. 2017) (noting that we
will not “reach arguments raised for the first time in a reply
brief or at oral argument”); In re Wettach, 811 F.3d 99, 115 (3d
Cir. 2016) (“[B]ecause they fail to develop either argument in
their opening brief, the Court holds that the Wettachs have for-
feited these claims.” (citation omitted)). Recall that GERS
sought interest on the GVI’s delinquent contributions in 1981,
and the issuing court, by including the anticipatory provision
about interest, ostensibly sought to impose it in the event and
to the extent that Virgin Islands law later permitted. And after
the District Court found that the GVI breached the consent
judgment by intentionally withholding contributions from
GERS beginning in late 2016, the GVI willingly repaid those
amounts with interest and delinquency fees. So whether GERS
needed to file what seemingly would have been a pro forma
motion is neither an “exceptional circumstance” that favors
reaching this unpreserved issue, Brown v. Philip Morris Inc.,
250 F.3d 789, 799 (3d Cir. 2001), nor a matter of “public
importance” whose non-resolution could lead to a “miscarriage

‐36-
The District Court rejected the GVI’s argument that this would
retroactively enhance its liability, and applied both statutes to
the GVI’s balance of missed contributions as of November 2,
2005—not just to contributions missed on or after that date.
Neither the delinquency-fee provision nor the interest statute
contains any express indication that the legislature intended
retroactive application. And the GVI asserts, with no contrary
indications from GERS, that “[t]here is no legislative history
reflecting legislative intent to apply retroactively 3 V.I.C.
§§ 704 and 736.” GVI’s Nov. 16, 2020 Legis. Hist. Ltr., Dkt.
No. 57, at 2. The District Court also recognized as much. So
the question is whether the statutes increase the GVI’s liability
for past actions. See Landgraf v. USI Film Prods., 511 U.S.
244, 280–81 (1994); Atkinson v. Att’y Gen., 479 F.3d 222, 231
(3d Cir. 2007). If so, they have retroactive effect and cannot
be applied to conduct antedating their effective date.

We agree with the GVI that the statutes have retroactive
effect, and thus that the District Court impermissibly applied
them retroactively. Before November 2, 2005, the GVI’s lia-
bility for all its past under-contributions was fixed at their prin-
cipal amount. By subjecting that principal to interest and fees
under the statutes at issue, the District Court “increase[d] [the
GVI’s] liability for past conduct” and “attache[d] new legal

of justice.” Bagot v. Ashcroft, 398 F.3d 252, 256 (3d Cir. 2005)
(quoting Loretangeli v. Critelli, 853 F.2d 186, 189–190 n.5 (3d
Cir. 1988)). Further, the 1994 modification to the consent
judgment directed the GVI to remit to GERS “interest and all
other monies received of every kind and description belonging
to [GERS].” JA316. This language provides an alternative ba-
sis for allowing GERS to recover interest under the consent
judgment once permitted by Virgin Islands law.

‐37-
consequences to events completed before [their] enactment.”
See Landgraf, 511 U.S. at 266, 269–70, 281.

The District Court looked to an Eleventh Circuit case
that addressed postjudgment interest to support applying the
statutes to the GVI’s pre-existing balance. Yet it is prejudg-
ment interest that provides the better guide. In Shook &
Fletcher Insulation Co. v. Cent. Rigging & Contracting Corp.,
684 F.2d 1383 (11th Cir. 1982), the Eleventh Circuit held that
a new state law increasing the postjudgment interest rate
applied to an unsatisfied judgment secured under a prior ver-
sion of the law that had imposed a lower interest rate. Id. at
1388–89. Here, however, the 1984 consent judgment was not
a money judgment, nor did it in any way determine the amount
of the GVI’s liability. And postjudgment interest does not
relate to the substantive conduct underlying the judgment. By
contrast, the District Court’s application of interest and fees
increased the GVI’s liability for the very same conduct to
which GERS sought to attach liability in the enforcement
proceedings. For that reason and others,21 we look for
guidance to prejudgment interest cases such as F.D.I.C. v.
UMIC, Inc., 136 F.3d 1375 (10th Cir. 1998). In that decision,

21
For one, a judgment represents the fixed starting point of a
judicially determined obligation, one of which the obligor is
actually or constructively aware. Increasing the GVI’s liability
for past conduct of which it was unaware, on amounts that had
not yet been subjected to judicial determination, would work a
significant extension of postjudgment interest doctrine. For
another, the statutes amplify the GVI’s liability for past events
far more than was the case in Shook & Fletcher, because the
GVI’s conduct was previously subject to no interest at all, not
merely a lower rate.

‐38-
the Tenth Circuit held that a federal statute’s prejudgment
interest provision could not be applied to conduct giving rise
to prejudgment interest liability that occurred before its
passage. Id. at 1385–87. “A prejudgment interest award not
only substantially increases monetary liability for proscribed
conduct, but it is also very closely tied to the amount of harm
done by that conduct. It has all the indicia of a substantive rule
that cannot be applied retroactively without an instruction from
Congress . . . .” Id.; see also Trout v. Sec’y of Navy, 317 F.3d
286, 291–92 (D.C. Cir. 2003) (reversing district court’s award
of prejudgment interest on backpay and attorneys’ fees for
periods before effective date of interest statute, based in part
on Landgraf, because “conduct underlying the complaint,
rather than the procedural posture of the litigation, has
significance”). Likewise, application of delinquency fees and
interest is closely tied to the amount of harm for which GERS
sought recovery in court—missed employer contributions and
associated lost investment income—and increases the GVI’s
liability for that conduct.

The facts here do not convince us that these applications
of Landgraf are inapt. First, while the District Court rightly
noted that the GVI’s under-contributions were not “complete”
at the time of the statutes’ enactment, JA40–41 (citing
Landgraf, 511 U.S. at 280), the retroactivity inquiry is more
granular. It requires us to “determine the ‘important event’ to
which the statute allegedly attaches new legal consequences.”
Deweese v. Nat’l R.R. Pass. Corp. (Amtrak), 590 F.3d 239, 251
(3d Cir. 2009) (quoting Atkinson, 479 F.3d at 230) (emphasis
added). The Retirement Code makes clear that this event is the
discrete occurrence of under-contributing to GERS for a par-
ticular payroll period. Even if the GVI’s obligations to GERS
spanned decades and are “continuing,” 3 V.I.C. § 734, the

‐39-
“event” of any single under-contribution was complete—and
the delinquency incurred—once the applicable time after a
payroll period passed without the GVI contributing the full
amount required by the contribution rate in effect for that par-
ticular period.

Second, though our retroactivity analysis is “guided by
considerations” of “reasonable reliance” and “settled expecta-
tions,” Atkinson, 479 F.3d at 231, the GVI’s lack of contempo-
raneous knowledge of the under-contributions—and thus its
lack of actual reliance on the prior state of the law—does not
remove the taint. As we stated in Atkinson, “[i]mpermissible
retroactivity . . . does not require that those affected by the
change in law have relied on the prior state of the law.” Id. at
229 (citation omitted). And consider Landgraf. There, the
Supreme Court “did not base its decision on the specific con-
duct of Landgraf’s employer or on any reliance that either
Landgraf or her employer may have had on the state of the
law.” Id. at 228 (citing Landgraf, 511 U.S. at 282–84). Rather,
the Court “made a general analysis of the impact of the amend-
ment” and found “retroactivity improper because the amend-
ment instituted a legal change that attached a new legal burden
to the proscribed conduct.” Id. Likewise, in Hughes Aircraft
Co. v. Schumer, 520 U.S. 939 (1997), “[i]t was the new legal
burden imposed on events past, rather than the reliance on the
former law by the person affected, which was the basis for
holding” that the amendment at issue should not have been
applied retroactively. Atkinson, 479 F.3d at 228–29 (citing
Schumer, 520 U.S. at 943–45, 948). The GVI’s lack of reliance
might have colored the District Court’s application of the stat-
utes, but it is the new legal burden attached to GERS’s past
conduct that is dispositive.

‐40-
Finally, GERS contends that applying the statutes only
prospectively would frustrate their remedial purpose. But that
is “frequently . . . true” yet “not sufficient to rebut the presump-
tion against retroactivity.” Landgraf, 511 U.S. at 285. Here,
the text of the statutes suggests no remedial purpose—and the
parties agree that there is no relevant legislative history. With-
out more, the fact that, before the statutes’ enactment in 2005,
GERS had unsuccessfully sued the GVI for under-contributing
to a discrete early retirement incentive program does not sug-
gest that the Legislature viewed the unavailability of interest
and fees on all delinquent contributions as “failing [the Retire-
ment Code’s] purpose.” Cf. Silverlight v. Huggins, 488 F.2d
107, 108–10 (3d Cir. 1973) (holding that statute waiving Vir-
gin Islands tort immunity, after prior practice of passing special
waiver legislation on individual basis was held unconstitu-
tional, applied retroactively to causes of action accruing before
its enactment given “sincere[] concern[] that . . . damaged cit-
izens not remain uncompensated” and “reasons given for the
introduction of the bill”). And the facts belie GERS’s assertion
at oral argument that the GVI passed the 2005 statutes to rem-
edy GERS’s lost investment income on then-existing § 718(g)
deficiencies. Neither GERS nor the GVI knew of missing
fixed-percentage contributions until 2012, seven years later.22

Absent a clear statement of retroactive application in the
statutes’ text or discernible express legislative intent to apply
them retroactively, they cannot impose interest and penalties
on contributions that the GVI missed before their effective

22
The consent judgment lacks any suggestion that the GVI
agreed to subject itself to retroactive operation of a statute that
would otherwise only apply prospectively.

‐41-
date. We will vacate that portion of the District Court’s
judgment awarding $43.1 million to GERS in interest and fees
for the 1991–2009 period, and remand with instructions to
reduce those enhancements accordingly.23

3. GERS’s action was timely. Finally, the GVI argues
that the vast majority of its under-contributions are not subject
to interest or fees because the payments were made outside the
two-year statute of limitations applicable to an “action upon a
statute for a forfeiture or penalty.” 5 V.I.C. § 31(5)(B). The
GVI also maintains that GERS is barred by laches from recov-
ering the enhancements awarded by the District Court. We are
unpersuaded and conclude that GERS’s recovery of interest
and fees is timely. Even were we to disagree with the decisions
of other Circuits holding that enforcement of consent decrees
is subject only to equitable defenses, see, e.g., Bergmann, 665
F.3d at 683–84; Brennan, 352 F.3d at 62–63; see also Cook,
192 F.3d at 695, and even assuming GERS’s enforcement
motions are subject to statutes of limitations,24 the applicable
limitations period would not bar GERS’s recovery.

23
In the set of calculations pertinent to the District Court’s
$13.9 million award of principal for the 1991–2009 period,
RSM figured the total amount of interest and fees for under-
contributions on or after November 2, 2005 at $6,804,260:
$5,542,163 in delinquency fees and $1,262,096 in interest.
24
The Virgin Islands’ limitations periods apply to the “[t]ime
for commencement” of new actions. 5 V.I.C. § 31 (“Civil
actions shall only be commenced within the periods prescribed
below.”). GERS’s enforcement motions did not commence a
new action but were filed in an existing one.

‐42-
Contrary to the GVI’s position, the award of interest and
fees to GERS—both in form and substance—did not stem from
an action “upon a statute for a forfeiture or penalty,” but
motions to enforce “a judgment or decree of any court of the
United States . . . or Territory.” 5 V.I.C. § 31(1)(B), (5)(B).
So if any limitations period applies, it would be the 20-year
statute of limitations discussed above rather than the two-year
statute of limitations that the GVI invokes. Id. Just as GERS’s
proceedings to enforce the consent judgment against the GVI’s
under-contributions discovered in 2012 would be timely under
the 20-year statute of limitations, so too its recovery of interest
and fees on those deficiencies.

Nor does laches bar GERS’s recovery here, though the
District Court may have short-circuited some of the analysis by
concluding that GERS is a “sovereign” immune from laches.
JA30–35. We are not convinced that GERS is entitled to sov-
ereign status and, for the reasons set forth below, conclude that
the GVI’s laches defense nevertheless fails on the merits.

A creature of statute, GERS was established as an
“independent and separate agency” of the GVI with the “pow-
ers and privileges of a corporation.” 3 V.I.C. §§ 715(a),
701(c). But unlike “all other semi-autonomous instrumentali-
ties” of the GVI, the V.I. Legislature failed to recognize GERS
as a tax-exempt entity when the system was created. V.I. 26th
Legis., Bill No. 26-0071, Bill Summary, Section 1. Hence the
provision in the 2005 amendments to the Retirement Act grant-
ing tax-exempt status to GERS. See 3 V.I.C. § 701(f).
Endowed by statute with corporate powers and privileges, and
taxed as a corporation rather than treated as an exempt govern-
ment agency, GERS at its inception lacked some of the hall-
marks of a sovereign government unit.

‐43-
Likewise, endowing a government agency with the right
to “sue and be sued” is persuasive evidence that the Legislature
waived the agency’s immunity from timeliness defenses such
as laches and the statute of limitations.25 See, e.g., U.S.V.I.
Econ. Dev. Auth. v. Hypolite, No. ST-16-CV-268, 2019 WL
451370, at *3 (V.I. Super. Ct. Jan. 28, 2019) (collecting Virgin
Islands cases). This the Legislature did, granting the GERS
board the power to “sue and be sued” in the GERS name and
requiring that GERS assets be held in its own name and segre-
gated from those of the GVI. 3 V.I.C. §§ 701(c), 715(b)(6).
Territorial courts have held that a semi-autonomous agency
chartered as a “public corporation,” with its own assets and
legal existence, that could “sue and be sued” lacked sovereign
immunity from the statute of limitations. Hypolite, 2019 WL
451370, at *3. That conclusion may obtain for timeliness
defenses involving GERS as well.

25
Courts analyze immunity from the statute of limitations in
tandem with immunity from equitable timeliness defenses,
such as laches. See, e.g., Guar. Tr. Co. of N.Y. v. United States,
304 U.S. 126, 132 (1938) (discussing purpose of exempting
sovereigns from defense of laches and operation of statutes of
limitations); Dole v. Local 427, Int’l Union of Elec., Radio &
Mach. Workers, AFL-CIO, 894 F.2d 607, 612 (3d Cir. 1990);
In re Hooper’s Estate, 359 F.2d 569, 578 (3d Cir. 1966)
(“[T]he general principle that claims of the sovereign are not
subject to the defenses of laches and the statute of limitations,
is applicable to the Territory [of the Virgin Islands], unless
expressly waived, and is implied in all its enactments.” (citing
Bd. of Cnty. Comm’rs v. United States, 308 U.S. 343, 351
(1939))).

‐44-
What’s more, Virgin Islands law suggests that “public
corporations” generally, and GERS specifically, are subject to
certain statutes of limitations—something inconsistent with the
recognized exclusion of sovereigns from timeliness defenses
where they sue in their own name or for their constituents’ ben-
efit. See, e.g., Hooper’s Estate, 359 F.2d at 578 (“[I]mmunity
is based upon the public policy of protecting the citizens from
damage to or loss of their public rights and property through
the negligence of public officers.” (citing Guar. Trust Co. of
N.Y., 304 U.S. at 132)). For example, ordinary limitations
periods “shall apply to actions brought in the name of any pub-
lic corporation in the Virgin Islands, or for its benefit, in the
same manner as to actions by private parties.” 5 V.I.C. § 34
(emphasis added). And a provision of the Retirement Code
suspends operation of the statute of limitations as against
GERS for certain obligations. See 3 V.I.C. § 740 (“Notwith-
standing title 5 Virgin Islands Code, chapter 3, any payment
due the retirement system for services, repayment of loans or
mortgages, or for the repayment of any amounts due to error or
overpayment are not extinguished by the statute of limita-
tions . . . .”). Such a carve-out suggests that GERS may oth-
erwise remain subject to statutes of limitations and not consti-
tute a “sovereign” immune from timeliness defenses.

We do not decide whether GERS is a private, public, or
quasi-public corporation or, for that matter, whether its status
renders it immune from laches. All we decide in this regard is
that GERS’s immunity is too dubious a basis for rejecting the
GVI’s argument. That said, the GVI’s laches argument fails
on the merits. A party asserting laches as a defense must
establish (1) an inexcusable delay in bringing the action and
(2) prejudice. See, e.g., U.S. Fire Ins. Co. v. Asbestospray, Inc.,
182 F.3d 201, 208 (3d Cir. 1999). The crux of the GVI’s case

‐45-
for laches is that GERS delayed too long “in seeking delin-
quency fees and interest,” which prejudiced the GVI because
the expert had “difficulty in locating and making use of old
records and data entries.” Appellants’ Br. 54. Neither asser-
tion holds water.

First, GERS’s delay in bringing the enforcement pro-
ceedings that led to the award of interest and fees was excusa-
ble. After suing the GVI in 1981 and obtaining the consent
judgment in 1984, GERS was in court to modify it in 1994.
Then, in 2001, GERS sued the GVI for under-contributing to a
separate early retirement incentive program. GERS appealed
dismissal of that suit in 2005, and we affirmed for lack of ripe-
ness because it was too soon to say that “GERS members have
been denied, or are about to be denied retirement benefits.”
Turnbull, 134 F. App’x at 501. Having pursued its rights in
court for decades, and following this defeat, GERS might have
reasonably been wary of instituting further litigation when in
2012 it discovered the GVI’s under-contributions. Instead, it
waited to again sue the GVI until the pension system was just
a few years from the brink. And in the interim, GERS tried to
work with the Virgin Islands governor and the Legislature on
pension funding solutions, even proposing remedial legisla-
tion.26 The length of the delay in absolute terms was fairly
26
The GVI maintains that we cannot consider facts about
GERS’s out-of-court efforts because they lie outside the rec-
ord. But many of them can be found in this case’s extensive
record, and those that cannot are appropriate for judicial notice.
See, e.g., Benak ex rel. Alliance Premier Growth Fund v.
Alliance Capital Mgmt. L.P., 435 F.3d 396, 401 & n.15 (3d Cir.
2006) (judicially noticing a New York Times article on content
of settlement); United States v. Pozsgai, 999 F.2d 719, 731 (3d

‐46-
modest, especially given the Virgin Islands’ 20-year statute of
limitations on enforcement of federal-court judgments and, as
further context, the territory’s six-year statute of limitations on
actions to recover under a contract or “upon a liability created
by statute.” 5 V.I.C. § 31(1)(B), (3)(A)–(B). As noted above,
GERS waited four years after discovering the missing fixed-
percentage contributions to launch the proceedings that yielded
the District Court’s interest and fee award. See, e.g., Evergreen
Safety Council v. RSA Network Inc., 697 F.3d 1221, 1226 (9th
Cir. 2012) (noting that laches clock starts “when the plaintiff
knew (or should have known) of the allegedly infringing con-
duct” and stops when “the lawsuit in which the defendant seeks
to invoke the laches defense” is begun). That’s well within the
realm of reasonable delay, as shown by Marshak v. Treadwell,
595 F.3d 478 (3d Cir. 2009). There, we held that it was not
inordinate delay to wait five years after entry of a judgment or
injunction to initiate contempt proceedings. See id. at 496–97
(distinguishing Univ. of Pitt. v. Champion Prods., Inc., 686
F.2d 1040 (3d Cir. 1982), where plaintiff waited 50 years to
sue and there was no previously imposed injunction).

Second, the GVI’s prejudice argument lacks the neces-
sary predicate showings. The GVI appears to claim that
GERS’s delay exacerbated the lacunae in the pre-2010 records,
which lie at the heart of the GVI’s unsuccessful challenge to
RSM’s methodology. But the GVI does not explain how the
state of those records would have benefitted had GERS sued
nearer to 2012. In fact, according to RSM, the unavailability
of detailed pre-2010 data was chiefly attributable to the GVI’s
institution of new payroll software at the end of 2009 without
migrating the historical records or later performing mainte-

Cir. 1993) (appellate court may take judicial notice of matter
not before district court).

‐47-
nance on the decommissioned server. Even if records some-
how would have been more robust had GERS sued earlier, any
prejudice was shared by both parties. RSM did not structure
its methodology with a thumb on the scale in favor of GERS
because of evidentiary gaps. It examined the existing records
provided by both parties and, with 95 percent confidence,
calculated an interval into which the GVI’s 1991–2009 under-
contributions fell. Nor did the District Court, in adopting the
statistical midpoint of that range, punish the GVI for having
incomplete records. In arguing laches below, the GVI articu-
lated no cognizable prejudice attributable to the passage of
decades since entry of the consent judgment. Its argument here
founders on even shallower shoals.

Finally, even if the requisites for laches were met, we
would balk at applying the doctrine to bar GERS’s recovery of
interest and fees. To begin with, for many months after GERS
began these proceedings in 2016, the GVI intentionally with-
held from GERS all of its employees’, and its own, fixed-
percentage contributions. The GVI has claimed only that it
“fell behind” due to unspecified “exigent circumstances.”27
Appellants’ Reply Br. 12. But the record reveals nothing exi-
gent that would sufficiently excuse this conduct. On the con-
trary, the GVI’s Commissioner of Finance testified that these
27
The parties have attributed much of the interregna in the Dis-
trict Court proceedings to the damage wrought by Hurricane
Irma and Hurricane Maria, both of which occurred in Septem-
ber 2017. But the hurricanes cannot excuse the GVI’s miscon-
duct; the chronology doesn’t fit. The GVI began withholding
fixed-percentage contributions from GERS beginning in late
2016 and for months thereafter. And GERS brought its emer-
gency enforcement motion as to these withheld funds in March
2017.

‐48-
contributions were intentionally withheld because of garden
variety capital concerns that led the GVI to de-prioritize its
commitments to GERS—cash flow problems he could scarcely
differentiate from those faced by the GVI after it resumed con-
tributions. Unconvinced, the District Court held that the GVI’s
conduct breached the consent judgment, and the GVI ulti-
mately handed over some $36 million in principal and
enhancements for these withheld contributions. “Any willful
act concerning the cause of action which rightfully can be said
to transgress equitable standards of conduct is sufficient cause
for” a court to “refus[e] to aid the unclean litigant.” Monsanto
Co. v. Rohm & Haas Co., 456 F.2d 592, 598 (3d Cir. 1972).
The GVI can hardly invoke laches now after intentionally
breaching a court order, rendering its hands unclean with
respect to part of GERS’s action.

Nor need we apply the equitable remedy of laches if
doing so would undermine the public’s interests in resolution
of the affected claim. See, e.g., Virginian Ry. v. Sys.
Federation No. 40, 300 U.S. 515, 550 (1937) (“Courts of
equity may, and frequently do, go much farther both to give
and withhold relief in furtherance of the public interest than
they are accustomed to go when only private interests are
involved.” (citations omitted)); Md.-Nat’l Capital Park &
Planning Comm’n v. U.S. Postal Serv., 487 F.2d 1029, 1042
(D.C. Cir. 1973) (“Equitable remedies depend not only on a
determination of legal rights and wrongs, but on such matters
as laches, good (or bad) faith, and most important an appraisal
of the public interest.” (emphasis added) (citation omitted)).
The economic health of the Virgin Islands rests to a large
degree on the soundness of its public-pension system. It cannot
be over-emphasized that the central government is the Islands’
largest employer. GERS represents about 30 percent of the

‐49-
Islands’ gross domestic product. It “covers approximately
20% of the entire population of the Virgin Islands.” JA3958–
59. At oral argument, GERS estimated that about a third of the
Islands’ population contributes to GERS or depends on it for
income. The system’s receipt of tens of millions of dollars in
interest and fees is of the highest public importance. We would
decline to resolve the weighty issue of GERS’s entitlement to
those funds on grounds of laches even if the defense would
otherwise seem to apply.

We therefore conclude that the GVI’s timeliness
defenses do not bar any component of the District Court’s
award of interest and fees to GERS.

* * *

The consent judgment and applicable law require math-
ematical compliance, so the GVI’s failures to contribute what
was required by statutorily fixed percentages, even if inadvert-
ent, breached the consent judgment. In proceedings that first
centered on the GVI’s failure to remit fixed-percentage contri-
butions beginning in late 2016, the District Court later widened
the lens—assisted by an appointed expert—and found a breach
reaching back as far as 1991, when the GVI began shorting the
percentage contributions to which GERS was entitled. We will
not disturb that approach because the Court’s factbound con-
clusion about the extent of the asserted breaches was not
clearly erroneous and, at all events, because GERS’s original
pleadings and allegations in its enforcement motions may be
deemed amended as necessary to encompass that recovery.
Neither the GVI’s direct contributions to GERS under separate
funding legislation nor its compliance with a recent process
designed to reconcile contributions paid and owed for a retiring
employee demands an offset. And we perceive no abuse of

‐50-
discretion in the District Court’s reliance on the expert’s meth-
odology for calculating the 1991–2009 under-contributions.
We will affirm the District Court’s award to GERS of $18.9
million in principal.

GERS brought enforcement proceedings within about
four years of discovering these under-contributions, so its
recovery of interest and fees on those debts is timely. In fact,
the District Court had no discretion to waive the interest and
fees. But nothing suggests that the Legislature intended to
apply the late-arriving interest and fee statutes retroactively.
We will vacate the District Court’s award to GERS of $43.1
million in enhancements for the GVI’s 1991–2009 arrears and
remand for imposition of a lesser award excluding interest and
fees on contribution deficiencies that the GVI incurred before
the statutes’ effective date. Because there are no retroactivity
problems associated with the District Court’s award of $6.1
million in interest and fees for the 2010–2018 period, we will
affirm that portion of the judgment.

IV. GERS’S CROSS-APPEAL

Even a judgment of tens of millions of dollars only post-
pones GERS’s day of reckoning by a matter of months. So
GERS appeals the District Court’s separate ruling that the con-
sent judgment does not obligate the GVI to contribute billions
to actuarially equalize GERS’s assets and its liabilities to pen-
sioners. GERS derives this sweeping “ADEC” (short for
“actuarially determined employer contribution”) obligation
from section 718(f), which requires the GVI to “make
contributions which together with the members’ contributions
and the income of the system will be sufficient to provide
adequate actuarially determined reserve for the annuities,
benefits and administration of the System herein prescribed.”

‐51-
3 V.I.C. § 718(f). GERS interprets this provision to require the
GVI to make GERS actuarially sound should the fixed-
percentage contributions of the GVI and its employees, along
with GERS’s investment income, fail to do so. For its part, the
GVI maintains that section 718(f) merely announces the Leg-
islature’s intent that the fixed-percentage contributions from
both the GVI and its employees, as well as GERS’s investment
income, together yield an actuarially sound reserve for pension
benefits.28 The District Court rejected GERS’s argument, rea-
soning that the employer contributions contemplated by the
consent judgment and section 718 trace to payroll periods—
something irreconcilable with the proposed ADEC’s depend-
ency on an annual actuarial accounting.

28
At a hearing before the District Court, counsel for the GVI
conceded that “[t]here is an obligation to pay” the ADEC but
argued that it is “an obligation that is not part of this consent
decree.” JA1786–88 (“we’re not disputing that” the GVI is
statutorily obligated “to make the actuarially determined
employer contribution”). Counsel for the GVI sought to walk
back this statement in subsequent briefing and, before us,
maintains that there is no such ADEC obligation. We will not
tether our prediction of how the Virgin Islands Supreme Court
would decide this issue to counsel’s (apparently inadvertent)
oral statement. It is not a binding “judicial admission” because
whether the GVI is obligated under Virgin Islands law to make
the ADEC contribution to GERS is an issue of law, not a fact
susceptible of admission. See, e.g., Swift & Co. v. Hocking
Valley Ry., 243 U.S. 281, 289–90 (1916) (putative admissions
about “legal effect” are “inoperative”); accord New
Amsterdam Cas. Co. v. Waller, 323 F.2d 20, 24 (4th Cir. 1963),
cert. denied, 376 U.S. 963 (1964).

‐52-
We conclude that the Virgin Islands Supreme Court
would refuse to read GERS’s proffered ADEC requirement
into section 718(f). The text of the statute and GERS’s cited
authorities do not support imposing an obligation solely on the
GVI to fund GERS to the point of actuarial soundness. And
although there is scarce legislative history relevant to the
meaning of the provision, testimony of GERS representatives
to the Legislature reveals that the GVI’s employer contribu-
tions under section 718 have been understood for decades as
limited to fixed percentages of employee compensation. The
statutes are best read to require that the fixed-percentage
contributions of employees and employers be calibrated to
account for the changing actuarial needs of the system. But
those same statutes do not provide a mechanism for keeping
GERS actuarially funded if that fixed-rate funding structure
comes up short—whether because of proliferating unfunded
legislative mandates, GERS’s own mismanagement, flawed
actuarial projections, or the like.29 We will therefore affirm the
District Court’s judgment on this issue.

29
In dissent, our colleague attributes to us a reading of section
718(f) that “preclude[s] what Section 718 otherwise requires”
and “bak[es] a funding shortfall into the statute.” Dissenting
Op. at 18. We have trouble understanding the recipe. To begin
with, our dissenting colleague recognizes, as do we, that sec-
tion 718(g) “has never had a [] rate increase cap” comparable
to that on employee contributions. Dissenting Op. at 23. So
his assertion that our reading of section 718 assumes the
Legislature’s “self-sabotage” in erecting “a hard-capped-
contribution system,” Dissenting Op. at 18, does not even sur-
vive to the end of the dissenting opinion. At all events, the
Legislature’s choice of an actuarially calibrated fixed-

‐53-
A. GERS’s Textual Arguments

GERS’s central statutory argument for imposing the
ADEC obligation on the GVI is that not doing so would render
section 718(f) superfluous. If all section 718(f) does, GERS
protests, is announce the Legislature’s sanguine intention that
the schedule of percentages suffice to fund the system, then
section 718(f) has no independent content. But GERS never
explains why it is superfluous, particularly given the statute’s
amendment history, to interpret section 718(f) as requiring that
the employer contribution percentages first spelled out in sub-
section (g) in 1968 not be fixed but dynamic over time in pro-
portion to the evolving actuarial needs of the system. It may
well be that those percentages have not been accurately cali-
brated to the actuarial needs of the system, for whatever reason,
but that provides no justification for a supervening ADEC
obligation that would render superfluous the statute’s percent-
age contribution mechanism.

percentage structure to meet the system’s evolving needs does
not ensure a shortfall. The Retirement Code has often been
amended to, for example, increase the contribution rates,
change how those rates are set, and allocate responsibility for
funding various pension entitlements—such as the costs of the
special early retirement incentive program and the costs of
administering the system, both of which are borne by the
GVI. That fixed-percentage contributions may well have been
meeting the system’s needs until the 1990s makes the charge
of “self-sabotage” sound a bit overstated. See Dissenting Op.
at 18. And, of course, GERS always had—indeed, has availed
itself of—recourse to separate legislation to attempt to address
underfunding, such as the $7 million lump-sum annual pay-
ments from the GVI that it secured. See supra Section III.A.3.

‐54-
To begin with, saddling the GVI alone with the obliga-
tion to fund GERS to the point of actuarial soundness is, at best,
inconsistent with the text of section 718. And, at worst, impos-
ing such an obligation contradicts the import of the statutory
language. While section 718(f) requires the “employer [to]
make contributions” that “will be sufficient to provide
adequate actuarially determined reserve” for benefits to pen-
sioners, the linkage between those phrases is “which together
with the members’ [i.e., employees’] contributions and the
income of the system.” 3 V.I.C. § 718(f). A more natural read-
ing of section 718(f), then, is that actuarial soundness is a func-
tion of all of the following: the GVI’s contributions as
employer, its employees’ contributions, and GERS’s invest-
ment income earned through prudent financial decisions.30

30
Our dissenting colleague tries to wield the last antecedent
rule against our reading of section 718, applying the rule to
section 718(f) to assert that “the limiting phrase ‘shall make
contributions’ modifies the noun it immediately follows:
‘employer.’” Dissenting Op. at 19–22. To start, we doubt that
the last antecedent rule even applies here. The purported lim-
iting language is only preceded by one antecedent: “The
employer shall make contributions.” That means there is no
potential ambiguity for the interpretive canon to resolve, since
the other candidates follow after that so-called limiting lan-
guage. At all events, our point is simply that section 718(f)
lacks the clarity needed to support a supervening obligation
borne solely by the GVI to make GERS actuarially sound. So
we look to, among other related provisions of the Retirement
Code, an earlier subsection. Cf. New Prime Inc. v. Oliveira,
139 S. Ct. 532, 538 (2019) (“We’ve long stressed the signifi-
cance of the statute’s sequencing.” (citations omitted)); Pac.

‐55-
Even if this provision—by naming the GVI first and then, in a
subsidiary clause, mentioning employees and investment
income—could somehow be read to elevate the GVI’s respon-
sibility, a preceding subsection vitiates that reading by equal-
izing the input of all stakeholders to the actuarial soundness of
the system: “The various obligations of the System shall be
financed in accordance with actuarial reserve requirements
from contributions by members, contributions by the
employer, interest income, and other income accruing to the
System.” Id. § 718(a). Granted, the first sentence of subsec-
tion (a) may be redundant of subsection (f). But GERS seeks
to give content to the latter that would seemingly contradict the
former. Such an approach finds no support in canons of statu-
tory construction. See United States v. Bass, 404 U.S. 336, 344
(1971) (recognizing that “courts should interpret a statute with

Emplrs. Ins. Co. v. Global Reinsurance Corp. of Am., 693 F.3d
417, 430 (3d Cir. 2012) (highlighting importance of “a big-
picture look at the [provision’s] place in the [statute’s] overall
structure,” with attention to how “structure” and “sequen[ce]”
“create an obligation”). Section 718(a) independently supplies
that “[t]he various obligations of the System shall be financed
in accordance with actuarial reserve requirements from contri-
butions by members, contributions by the employer, interest
income, and other income accruing to the System,” with the
Board able to periodically “actuarially determine the rate of
contribution for members and employers of the System.” 3
V.I.C. § 718(a) (emphasis added). There is no antecedent con-
fusion here either, just the Legislature’s clear indication that
pension entitlements be financed according to actuarial reserve
requirements from inputs by all stakeholders and that the
GERS Board actuarially determine both employee and
employer contribution rates.

‐56-
an eye to the surrounding statutory landscape and an ear for
harmonizing potentially discordant provisions”).

With the text of the statute offering little or no support
for GERS’s position, we ask why, if the Legislature sought to
impose on the GVI a supervening obligation to fund GERS to
actuarial soundness, it would have promulgated (and routinely
amended) a detailed schedule of employee compensation per-
centages for the GVI to contribute? See 3 V.I.C. § 718(g).
GERS tries to save the fixed-percentage scheme from super-
fluity by characterizing it as the employer’s perennial default
and the ADEC as the conditional obligation, triggered only
when the fixed percentages underserve the system. Set aside
the reality that the so-called conditional would have swallowed
the default in each of the last 30-odd years—and thus that
GERS’s reading, like the GVI’s, still casts the Legislature as
Pollyanna. At bottom, GERS’s conception conflicts with the
statute’s history. Recall that the 1959 legislation creating
GERS established a fixed-percentage employee contribution
but, though using similar actuarial reserve language, did not
attach a percentage to the employer’s contribution. From the
beginning, “[t]he amount of contributions by the employer for
the various purposes of the system shall be determined by
applying a percentage rate to the aggregate compensation of
the members for each regular payroll period.” Act of June 24,
1959, No. 479, § 718, 1959 V.I. Sess. Laws 92, 111 (emphases
added). Unsurprisingly, the Legislature amended the statute to
announce just such a schedule of percentages that the GVI
would need to contribute as employer. Act of Feb. 8, 1968,
No. 2098, § 718(g), 1968 V.I. Sess. Laws, Pt. I, 9, 9 (defining
first employer contribution window as “pay periods starting:
before July 1, 1968”). The historical progression suggests that
the Legislature enacted the fixed-percentage employer contri-

‐57-
butions to instantiate the actuarial soundness requirement.31
Nothing suggests that it ever sought to upend this consistent
structure sub silentio by imposing a second, separate ADEC
obligation.

GERS next argues that the consent judgment and, by
implication, the Legislature could have used words such as
“fixed” if it wished to cabin the employer’s obligation to fixed-
percentage contributions. But the establishment of a detailed
schedule of percentages, without a comparable articulation of
the GVI’s potentially limitless mandate to fully fund GERS,
militates against inferring any legislative intent to create the
ADEC. Legislatures do not hide elephants in mouseholes.
Whitman v. Am. Trucking Assocs., 531 U.S. 457, 468 (2001).
There is no provision for “actuarially determined employer
contributions” in the statute—only sources of contributions
that, “together,” must provide an “actuarially determined
reserve.” See, e.g., Bates v. United States, 522 U.S. 23, 29
(1997) (noting that courts “ordinarily resist reading words or
elements into a statute that do not appear on its face”). In view
of subsection (f) and the surrounding statutory landscape, any
31
Unlike our dissenting colleague, we think it unremarkable
that the Legislature struck from the 1968 version of section 718
the original provision that “the amount of contributions by the
employer for the various purposes of the system shall be deter-
mined by applying a percentage rate to the aggregate compen-
sation of the members.” See Dissenting Op. at 26 &
n.28. After all, in those same 1968 amendments, the Legisla-
ture for the first time fixed the employer’s percentage rate to
be applied to employees’ aggregate compensation. Retaining
the vestigial clause may well have caused confusion, or even
engendered litigation, about whether there was an additional
percentage that the GVI needed to contribute.

‐58-
suggestion that judges or legislators should have added clari-
fying language to exclude reading in an ADEC obligation
strikes us as fanciful.

To support postulating the ADEC, GERS points finally
to section 718a, a provision enacted in 2006 to govern how
GERS informs the GVI of needed appropriations. Section
718a provides for transmittal to the Legislature of the “actuar-
ial valuation and appraisal” required by section 718, along with
an “itemized estimate of the amounts necessary to be appropri-
ated by the government to [GERS].” 3 V.I.C. § 718a(a). But
the lack of an ADEC obligation does not mean that “Section
718a would have no reason to exist in the first place.” Cross-
Appellant’s Reply Br. 8. Even to pay the biweekly contribu-
tions, the GVI needs to know approximately how much to
appropriate annually for its GERS commitments. And missing
from the detailed enumeration of elements required to be
included in the appropriations estimate, see 3 V.I.C. § 718a(a)–
(e), is any clear call for the information most critical to GERS’s
proffered ADEC: its projected commitments to pensioners for
the fiscal year. We think it natural for the Legislature—one
year after authorizing the GERS Board to determine and
(apparently within limits) increase contribution rates—to enact
a statute requiring detailed support for GERS’s appropriations
requests. All the more so given our plain reading of section
718(f), under which all stakeholders must ensure the pension
system’s actuarial soundness and rates must be calibrated to
actuarial needs.

B. GERS’s Authorities

Nor do the cases GERS cites move the needle. Apply-
ing them here would assume the answer to the question pre-
sented: whether GERS’s proffered ADEC obligation flows

‐59-
from the text of section 718 or should somehow be implied
based on the relevant milieu.

Start with GERS’s leading case, Louisiana Municipal
Association v. State, 893 So. 2d 809 (La. 2005). It dealt with
statutes that unequivocally provide for both an employer con-
tribution rate and an actuarially required employer contribu-
tion. See id. at 837–38; La. Stat. Ann. § 11:103(B)(1)–(3). By
contrast, GERS’s appeal requires us to determine whether the
GVI has any such second obligation independent of the fixed-
rate contributions set by statute.

GERS’s other authorities involve pension regimes
under which employees have percentage-based contribution
obligations, but the contributions of the employer (i.e., a state
and its counties) are actuarially determined.32 See, e.g., Hall v.
Elected Officials’ Ret. Plan, 383 P.3d 1107, 1110–11 (Ariz.
2016) (“The employee contribution rate was set by statute ini-
tially at 6%, with the employer being responsible for contrib-
uting the remaining amount necessary to fund a defined benefit
upon retirement.” (citing Ariz. Rev. Stat. Ann. § 38-810(A)
(1985))); Kaho‘ohanohano v. State, 162 P.3d 696, 706 (Haw.
2007) (“Trustees engage an actuary to determine the employ-
ers’ normal cost and accrued liability contributions for each
fiscal year.” (citations omitted)); Haw. Rev. Stat. Ann. § 88-45
(setting forth schedule of fixed-percentage contributions for
employees); Bd. of Trustees of Town of Lake Park Firefighters’
Pension Plan v. Town of Lake Park, 966 So.2d 448, 450 (Fla.
Dist. Ct. App. 2007) (noting “mandatory five percent contribu-
32
These cases, and most others that GERS relies on, decided
constitutional challenges to legislation that effectively reduced
the status quo of pension benefits. The posture of these cases
limits their relevance to GERS’s claim in this appeal.

‐60-
tion or payment by each firefighter” and “a mandatory payment
by the municipality of ‘a sum equal to the normal cost of and
the amount required to fund any actuarial deficiency shown by
an actuarial valuation as provided in part VII of chapter 112’”
(quoting Fla. Stat. § 175.091(1)(g)); see also Wayne Cnty.
Emps. Ret. Sys. v. Wayne Charter Cnty., 859 N.W.2d 678, 679
(Mich. 2014) (“Each year, the county is required by Const.
1963 art. 9, § 24, to make an ‘annual required contribution’
(ARC). An annual actuarial valuation determines the ARC
amount.” (citation omitted)); Mich. Compl. Laws Ann.
§ 38.1140m(1) (“The required employer contribution is the
actuarially determined contribution amount.”). These cases do
not help us reconcile the “together” clause of section 718(f)—
not to mention the first sentence of section 718(a)—with
GERS’s argument that, in fact, the actuarial funding
responsibility lies solely with the GVI.33

Still other cases relate to state statutes that explicitly
place the obligation on the employer to make up any shortfall.
See, e.g., Booth v. Sims, 456 S.E.2d 167 (W. Va. 1994); W. Va.
Code § 5-10-31(b) (“[T]he participating public employers’
33
The statutes at issue in one case that GERS invokes, Hall,
383 P.3d at 1110–11, arguably support our plain reading of
section 718 in which the fixed-percentage contribution rates
are themselves intended to be calibrated for actuarial sound-
ness. See Ariz. Rev. Stat. Ann. § 38-810(C) (“[E]ach employer
shall make contributions on a level percent of compensation
basis for all employees . . . sufficient under the actuarial valu-
ation to meet both the normal cost plus the actuarially deter-
mined amount required to amortize the unfunded accrued
liability over a closed period . . . that is established by the board
taking into account the recommendation of the plan’s actu-
ary . . . .”).

‐61-
contributions . . . shall be a percent of the members’ total
annual compensation . . . . equal to an amount which, if paid
annually by the participating public employers, will be suffi-
cient to provide for the total normal cost of the benefits
expected to become payable to all members and to amortize
any unfunded liability found by application of the actuarial
funding method[.]” (emphasis added)). And ERISA’s “defined
benefit plan” addresses a statutorily defined “asset pool” in
which “the employer typically bears the entire investment risk
and . . . must cover any underfunding as a result of a shortfall
that may occur from the plan’s investments.” Hughes Aircraft
Co. v. Jacobson, 525 U.S. 432, 439–40 (1999).

At best, the cases that GERS relies on take us no closer
to answering whether section 718(f) obligates the GVI to fund
GERS to actuarial soundness. In fact, the specificity with
which the regimes addressed in those cases articulate an
employer’s actuarially determined contribution or shortfall
liability renders problematic the less concrete language in sec-
tion 718(f).

C. The Parties’ Historical Understanding

Though there is no formal legislative history contempo-
raneous with the 1959 or 1968 laws enacting and amending the
Retirement Code, subsequent testimony of GERS representa-
tives to the Legislature undermines GERS’s argument for the
ADEC. In an October 8, 1997 meeting of the Committee on
Government Operations about a bill on allocating GERS’s
administrative expense, a representative of GERS testified to
the Legislature that:

[W]hat would happen in the future is that based
on our requirement in the statute that the funding

‐62-
of the system be computed on the actuarial
reserve basis, we would then need to come back
to the Legislature and report our latest findings
in term[s] of the actuarial report and recommend
that some adjustment be made in the employer
contribution and/or the employee contribution.
That is basically the only way that the system can
begin to address the underfunding. . . . [T]he lat-
est actuarial evaluation . . . determined that an
additional contribution totaling five—approxi-
mately, five and-a-half percent would be needed
to be added to the current contribution rate for-
mula that we have in place.

Oct. 8, 1997 Gov’t Ops. Comm. Hrg. Tr. 128:22–130:2
(emphases added). Increasing the fixed-percentage contribu-
tions of employees and employers was thus understood as “the
only way that the system can begin to address” underfunding.34

Eight years later, in a September 12, 2005 session of the
same committee, then-Acting Administrator and CFO of
GERS, Willis Todmann, testified at a hearing on the 2005
amendments to identify “specific areas . . . where the most
immediate action is needed.” Hrg. Tr. 12:12–14. Also present

34
Legislators appear to have shared this understanding. Trying
to explain how GERS works, in the lead-up to passage of the
2005 bill, Senator Barshinger stated during debate that “[y]ou
pay in and interests [sic] is made on the money you give in, and
in fact the government throws in an additional percentage, and
that creates a pool of money for you.” Sept. 26, 2005 Reg.
Sess. (Part II) Hrg. Tr. 46:2–6 (emphasis added).

‐63-
were a member of GERS’s Board of Trustees and the Assistant
GERS Administrator. Todmann told the Committee:

The System requires full autonomy to incremen-
tally set and adjust the contribution rates for the
employer and employees as may be determined
from the annual actuarial valuations. . . . The
various obligations of the System . . . are required
to be financed in accordance with the actuarial
reserve requirements from the contribution by
members, contributions by the employer, interest
income, and other income accruing to the Sys-
tem, but in reality, this does not occur because
executive and the Legislature randomly deter-
mine when contributions are to be increased and
how much those contributions should be. When-
ever a shortfall occurs in the income from invest-
ments and the contributions from the employer
and employee, the shortfall must be made up by
the Plan Sponsor and member contributions to
keep pace with the actuarial determinations for
the payment of future pension obligations. . . .
Although the statute does not provide for the
proper actuarial funding of the System, the
G.E.R.S. has repeatedly requested that the Leg-
islature enact such corrective measures. . . . The
enabling Act failed to incorporate a proper fund-
ing plan because it was the intention of the Leg-
islature that the income generated from the
investments and the contributions from the
employer and employees will meet the funding
needs to pay the future pension benefit obliga-
tions. . . . [W]hat is most needed to financially

‐64-
reform the System is a corrective funding plan to
provide for the annual actuarial funding of the
shortfall in the cost of the System. . . . The annual
funding of the G.E.R.S. must be made a “statu-
tory debt” through legislation.

Sept. 12, 2005 Gov’t Ops. Comm. Hrg. Tr. 13:14–17, 14:3–18,
15:3–6, 16:3–8, 17:11–20 (emphases added). Todmann’s tes-
timony shows that GERS understood the following: (a) short-
falls “must be made up by” the GVI and employees—rather
than just the GVI via a supervening ADEC obligation; (b) the
language in section 718(f) reflects the Legislature’s “intention”
that the fixed contribution rates would be adjusted to provide
actuarial soundness; and (c) annual, actuarially required fund-
ing of GERS was not a “statutory debt” of the GVI. As Tod-
mann and others advocated, the 2005 amendments recognized
that “[t]he GERS Board of Trustees is the entity best suited to
determine the actuarial level and to fix appropriate contribu-
tion rates, commensurate with the future pension benefit obli-
gations of the system.” V.I. 26th Legis., Bill No. 26-0071, Bill
Summary, Section 14 (emphasis added); see 3 V.I.C. § 718(a).
But the

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/4676154. Public record. Not legal advice.