Justia ERISA Opinion Summaries

The Court of Appeal reversed the trial court's judgment in favor of CCCERA following the denial of plaintiff's fourth amended petition for writ of mandate (petition) filed under Code of Civil Procedure section 1085. Plaintiff alleged that CCCERA and its governing Board improperly reduced his retirement benefits retroactively, pursuant to Government Code section 31539.The court concluded that the trial court abused its discretion by deciding to reduce plaintiff's retirement allowance. The court explained that, in light of legislative history and the law in existence at the time of plaintiff's retirement, the Board's determination that plaintiff caused his pension to be improperly increased at the time of retirement, pursuant to subdivision (a)(2) of section 31539, was not in conformity with the spirit of the law and did not subserve substantial justice. In this case, although the court recognized plaintiff's pre-retirement efforts to increase his compensation earnable in the period before his retirement, which allowed him to maximize his pension and epitomized the act of pension spiking which led to the subsequent enactment of the California Public Employees' Pension Reform Act of 2013 (PEPRA), the court cannot sanction the Board's legally unsupported use of section 31539 to penalize plaintiff for conduct that—while now prohibited under the PEPRA—was expressly permitted at the time of his retirement. View "Nowicki v. Contra Costa County Employees' Retirement Ass'n" on Justia Law

Trustees of five multi-employer benefits funds filed suit against Green Nature under section 515 of the Employee Retirement Income Security Act (ERISA) and section 301 of the Labor Management Relations Act (LMRA), alleging that Green Nature failed to contribute to the funds on behalf of its non-union employees and sought to collect from Green Nature the delinquent contributions, interest, costs, and attorney's fees.The Eighth Circuit affirmed the district court's grant of summary judgment in favor of the trustees. The court concluded that the district court correctly determined that the collective bargaining agreement (CBA) unambiguously required fringe benefit contributions for non-union employees. The court also found that an award of delinquent fringe benefit contributions would not improperly require Green Nature to "duplicate fringe contributions." The court need not determine whether issue preclusion could ever be a valid defense to a collection action because the substantive elements of issue preclusion are not satisfied. Finally, the district court did not abuse its discretion in awarding the trustees attorney's fees and in declining to reduce the amount. View "Nesse v. Green Nature-Cycle, LLC" on Justia Law

The Labor Management Relations Act forbids employers from directly giving money to unions, 29 U.S.C. 186(a); an exception allows an employer and a union to operate a trust fund for the benefit of employees. Section 186(c)(5)(B) requires the trust agreement to provide that an arbitrator will resolve any “deadlock on the administration of such fund.” Several construction companies and one union established a trust fund to subsidize employee vacations. Six trustees oversaw the fund, which is a tax-exempt entity under ERISA 26 U.S.C. 501(c)(9). A disagreement arose over whether the trust needed to amend a tax return. Three trustees, those selected by the companies, filed suit, seeking authority to amend the tax return. The three union-appointed trustees intervened, arguing that the dispute belongs in arbitration.The court agreed and dismissed the complaint. The Sixth Circuit affirmed. While ERISA plan participants or beneficiaries may sue for a breach of statutory fiduciary duty in federal court without exhausting internal remedial procedures, this complaint did not allege a breach of fiduciary duties but rather alleges that the employer trustees’ own fiduciary duties compelled them to file the action to maintain the trust’s compliance with tax laws. These claims were “not directly adversarial to the [union trustees] or to the Fund.” View "Baker v. Iron Workers Local 25" on Justia Law

The DC Circuit affirmed the district court's grant of summary judgment to PBGC, concluding that 29 C.F.R. 4044.4(b) is valid and that the PBGC Appeals Board reasonably applied section 4044.4(b) to deny appellant's lumpsum request. The court also concluded that, because fiduciaries must act in accordance with the terms of plan documents only "insofar as such documents and instruments are consistent with the provisions of" the Employee Retirement Income Security Act of 1974 (ERISA), Penn Traffic fulfilled its fiduciary duties by denying appellant's request in compliance with section 4044.4(b). Therefore, the court need not address appellant's contentions that Penn Traffic's handling of his lumpsum request was inconsistent with the Plan's terms. View "Fisher v. Pension Benefit Guaranty Corp." on Justia Law

Plaintiffs, five former employees of CB&I who worked as laborers on a construction project in Louisiana, quit before the project ended and thus made them ineligible to receive the Project Completion Incentive under the term of that plan. Plaintiffs filed suit in state court seeking the bonus for the period they did work, arguing that making such employees ineligible for bonuses amounts to an illegal wage forfeiture agreement under the Louisiana Wage Payment Act. LA. STAT.ANN. 23:631, 23:632, 23:634. After removal to federal court, the district court concluded that the incentive program was an Employee Retirement Income Security Act (ERISA) plan because it required ongoing discretion and administration in determining whether a qualifying termination took place.The Fifth Circuit concluded that the employee benefit at issue—a bonus for completing the project—is not an employee benefit plan under ERISA. The court explained that the plan involves a single and simple payment; determining eligibility might require the exercise of some discretion, but not much; and the plan lacks the complexity and longevity that result in the type of "ongoing administrative scheme" ERISA covers. Therefore, there is no federal jurisdiction over this action. The court vacated and remanded for the case to be returned to state court. View "Atkins v. CB&I, LLC" on Justia Law

The Fund brought this action to collect $1.1 million in withdrawal liability under the Employee Retirement Income Security Act (ERISA). At issue was whether arbitration was properly initiated by Neshoma in response to the suit and whether Neshoma's third-party claim against its union was preempted by the National Labor Relations Act (NLRA).The Second Circuit held that the parties were bound by the Fund rules, which required Neshoma to initiate arbitration with the AAA by filing a formal request before the statutory deadline, and Neshoma failed to do so. The court also held that the district court did not err in dismissing Neshoma's third-party complaint against the Union on the pleadings as preempted by the NLRA. Accordingly, the court affirmed the judgment. View "American Federation of Musicians and Employers' Pension Fund v. Neshoma Orchestra and Singers, Inc." on Justia Law

Bell employees participated in a benefit plan, completely funded by contributions from the members of about 69 unions. The plan is administered by a Board of Trustees, governed by Trust Indenture documents that provide that plan members must contribute a fixed amount unless a member’s union has set a different contribution amount. In 2008, Bell’s union voted to increase its members’ contributions from 6% to 8% of their weekly wages. In 2014, the Trustees revealed that the plan’s financial health was deteriorating. Bell employees unsuccessfully petitioned the union to reduce their compelled-contribution rate. In 2016, Bell's collective-bargaining contract expired. During negotiations, the employees again unsuccessfully requested that the union reduce their required contribution rate. Other members of the union, working for a different employer, were either contributing at lower rates or not contributing; they were originally part of a different union that did not participate in the plan. Contract re-negotiations were unsuccessful. The employees lost certain benefits that are available only to active contributors to the plan.The Seventh Circuit affirmed the dismissal of a suit under 29 U.S.C. 1104(a)(1)(D). The Trustees’ action, interpretation of the Trust Indenture, was not a breach of fiduciary duty. The Indenture can be reasonably interpreted as permitting different segments within a union to contribute to the plan at different levels. Even if the Union controlled the amount of revenue coming into the plan, it did not act as fiduciary but as a settlor. View "Bator v. District Council 4, Graphic Communications Conference" on Justia Law

The First Circuit held that the New Hampshire Judicial Retirement Plan (Plan) does not allow a former judge who resigned with sufficient years of creditable service, but before reaching the minimum retirement age, to receive a Service Retirement Allowance (SRA) upon later reaching the retirement age.Plaintiff was fifty-four years old when she resigned from her position as a superior court justice for the state of New Hampshire. Plaintiff served in that position for sixteen-and-a-half years. At the age of sixty-one, Plaintiff applied for an SRA. The Board of Trustees of the Board of Trustees (Board) of the Plan denied her application. Plaintiff filed suit against the Plan seeking a declaratory judgment that she was eligible for an SRA. The district court granted summary judgment in favor of the Plan as to Plaintiff's claim for violation of N.H. Rev. Stat. 100-C, 5, concluding that the plain language of the statute requires a judge to be in active service when she elects to retire and claim a service retirement allowance. The First Circuit affirmed, holding that, under the circumstances of this case, Plaintiff was not eligible to receive an SRA on her application. View "Coffey v. New Hampshire Judicial Retirement Plan" on Justia Law

The First Circuit affirmed the judgment of the district court in favor of Sun Life Assurance Company of Canada finding that Sun Life properly permitted an offset of Appellant's benefits under tis employer-sponsored long-term disability insurance policy (the Plan) by the amount of Appellant's service-connection disability compensation (Veterans' Benefits), holding that the district court did not err.Specifically, the First Circuit held (1) Appellant's Veterans' Benefits fell squarely within the definition of "Compulsory Benefit Act or Law"; (2) that the district court did not err by concluding as a matter of law that Veterans' Benefits unambiguously qualify as a form of "Other Income Benefit" covered by the Plan's offset provision; and (3) the district court did not err by rejecting as a matter of law Appellant's assertion that Sun Life's offset determination was motivated, at least in part, by Appellant's military service in violation of the Uniformed Services Employment and Reemployment Rights Act. View "Martinez v. Sun Life Assurance Co. of Canada" on Justia Law

Signode assumed an obligation to pay health-care benefits to a group of retired steelworkers and their families. Signode then exercised its right to terminate the underlying benefits agreement and also stopped providing the promised benefits to the retired steelworkers and their families, despite contractual language providing that benefits would not be “terminated … notwithstanding the expiration” of the underlying agreement. The retirees and the union filed suit under the Labor-Management Relations Act, 29 U.S.C. 185, and the Employee Retirement Income Security Act of 1974, 29 U.S.C. 1132(a)(1)(B). The Seventh Circuit affirmed the district court’s entry of a permanent injunction, ordering Signode to reinstate the benefits. The agreement provided for vested benefits that would survive the agreement’s termination. While there is no longer a presumption in favor of lifetime vesting, the court applied ordinary contract law interpretation rules and concluded that the agreement unambiguously provided retirees with vested lifetime health-care benefits. Even if the agreement were ambiguous, industry usage and the behavior of the parties here provide enough evidence to support vesting such that resolution of any ambiguity in favor of the plaintiffs as a matter of law would still be correct. View "Stone v. Signode Industrial Group LLC" on Justia Law