Justia ERISA Opinion Summaries

This dispute related to Employee Retirement Security Act (ERISA), 29 U.S.C. 1001 et seq., contributions made pursuant to a collective bargaining agreement. The district court ordered return of certain allegedly mistaken employer contributions even though the plan administrator determined that the contributions were not made by mistake. Because the court found that the administrator's decision was not an abuse of discretion, the court reversed and remanded for further proceedings. View "U.S. Foodservice, Inc. v. Truck Drivers & Helpers Union" on Justia Law

Raybourne was a quality engineer for 23 years. The employer provided a long-term disability plan that paid benefits for up to 24 months if disability prevented him from performing the duties of his regular job. After 24 months, the plan paid benefits only if he was unable to perform all material duties of any occupation for which he was reasonably qualified. Raybourne suffered degenerative joint disease in his foot, with severe pain. In 2003, he stopped working and underwent the first of the four surgeries. From December 2003 through February 2006, Cigna paid benefits, then determined that he was not disabled under the more stringent standard. Raybourne exhausted administrative remedies, then sued under 29 U.S.C. 1132(a)(1)(B). The district court ruled in favor of Cigna. On remand the court rejected Cigna’s “unconvincing” explanation for how the company determined that Raybourne was not disabled. The court found that Cigna relied on the report of a non-treating physician and on the Social Security Administration’s initial rejections of Raybourne’s claim, failing to consider the SSA’s final determination of disability. The Seventh Circuit affirmed, finding that denial of benefits was based on a conflict of interest rather than on the facts and the terms of the policy. View "Raybourne v. CIGNA Life Ins. Co. of NY" on Justia Law

After they were fired from their jobs, Appellants filed suit in federal district court against their former employer (Employer) and against the severance plan (Plan) established by Employer pursuant to ERISA. The complaint asserted federal claims under ERISA, ADEA, ADA, and other federal laws, and also asserted a breach of contract claim, an employment discrimination claim, and an unjustified dismissal claim under Puerto Rico law. The district court granted Appellees' motion for summary judgment. Appellants challenged that ruling as well as a number of the district court's other orders. The First Circuit Court of Appeals affirmed, holding that there was no error in the management of this case or the grant of Appellees' motion for summary judgment. View "Cruz v. Bristol-Myers Squibb Co., PR, Inc." on Justia Law

While employed at PPG, plaintiffs were represented by three labor unions. In 2001 PPG modified health benefits for retirees, requiring that retirees pay a portion of the cost. The unions thought the modification was a breach of collective bargaining agreements and sued, requesting that the Pennsylvania district court order PPG to arbitrate the benefit dispute with the unions. The district court entered judgment for PPG, holding that the benefits had not vested. The Third Circuit affirmed. Meanwhile, in 2005, more than a year before the district court entered judgment, several individual retirees filed a putative class action in the Southern District of Ohio. Their core allegation was identical to that in the Pennsylvania action; they asserted claims under the Labor Management Relations Act and ERISA and sought monetary damages and an injunction ordering reinstatement of full coverage. The district court held that the Pennsylvania judgment collaterally estopped the plaintiffs from arguing the contrary in this case. The Sixth Circuit reversed. The district court in the Pennsylvania action neither certified a class nor employed any other “special procedures” to protect the retirees’ interests in that action, so the plaintiffs are not bound to that decision. View "Amos v. PPG Indus., Inc." on Justia Law

Plaintiff filed suit under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. 1001 et seq., the Fair Labor Standards Act (FLSA), 29 U.S.C. 201 et seq., and state law, alleging that defendant had retaliated against him after he raised complaints protected by those statutes. The district court granted summary judgment to defendant on the federal law claims and dismissed the state law claims without prejudice. The court concluded that plaintiff failed to make a prima facie case of retaliation under ERISA. Likewise, plaintiff failed to make a prima facie case of retaliation under the FLSA. At any rate, plaintiff failed to show a causal connection between his complaint about holiday meal time and his termination six months later. Accordingly, the court affirmed the judgment. View "Shrable v. Eaton Corp." on Justia Law

A collective bargaining agreement governs the relationship between Acument and its retired employees. Prior to 2008, the company paid healthcare and life-insurance benefits to qualified retirees. When Acument ended these benefits in 2008, a class of 64 retirees claimed that the company had violated the CBA in violation of the Employee Retirement Income Security Act and the Labor Management Relations Act. The district court granted Acument summary judgment. The Sixth Circuit affirmed, characterizing the issue as “a matter of contract.” The relevant language states that the company “reserves the right to amend, modify, suspend, or terminate the Plan,” consisting of: retiree medical coverage; retirement income; disability income; and life insurance. View "Witmer v. Acument Global Tech., Inc." on Justia Law

In a 2009 opinion, the Sixth Circuit held that, in a 1998 collective bargaining agreement, CNH agreed to provide health-care benefits to retirees and their spouses for life, but rejected the suggestion that the scope of this commitment in the context of healthcare benefits, as opposed to pension benefits, meant that CNH could make no changes to the healthcare benefits provided to retirees. The court remanded for a determination of reasonableness with respect to CNH’s proposed changes to its retiree healthcare benefits, under which retirees, previously able to choose any doctor without suffering a financial penalty, would be put into a managed-care plan. The court listed three considerations: Does the modified plan provide benefits “reasonably commensurate” with the old plan? Are the proposed changes “reasonable in light of changes in health care”? And are the benefits “roughly consistent with the kinds of benefits provided to current employees”? On remand, the district court granted CNH summary judgment without reaching the reasonableness question or creating a factual record from which the determination could be made on appeal. The Sixth Circuit again remanded.View "Reese v. CNH America LLC" on Justia Law

In 2009, George, a vice president of JA, discovered that money withheld from his pay was not being deposited into his retirement account and health savings account. He complained to JA’s accountants and executives, including Burk. He contacted the Department of Labor but declined to file a complaint. He raised the issue with board members, then received checks for $2,600 for the missed deposits plus interest. His employment agreement ran until June 30, 2010, but he had discussed, with Burk and others, retiring in April 2010. On January 4, 2010, Burk told George not to return to work. Burk later discovered that George had drawn down the account containing his deferred compensation. J A concedes that George was entitled to withdraw the funds, but it did not rescind his discharge. George claimed violation of the Employee Retirement Income Security Act, 29 U.S.C. 1104(a) and retaliation for reporting that violation. The district court granted JA summary judgment. The Seventh Circuit vacated. An employee’s grievance is within ERISA’s scope of protection against retaliation whether or not the employer solicited information. George notified JA of the potential breach of its fiduciary duties and asked what would be done. Those conversations involved an “inquiry.” View "George v. Jr. Achievement of Cent. IN, Inc." on Justia Law

Plaintiffs are retired unionized employees of defendant and were covered by collective bargaining agreements that addressed healthcare benefits. The parties contest whether the CBAs guaranteed employees and their spouses lifetime healthcare benefits after retirement. After retiring, the employees and spouses continued to receive healthcare insurance from defendant. Between ages 62 to 65, defendant paid 80% of the premium costs. When the retirees turned 65, defendant assumed 100% of premium costs. In 2006, defendant informed plaintiffs that the company was instituting a new healthcare plan that would no longer cover 100% of the premiums. Plaintiffs claimed violations of the Labor Management Relations Act, 29 U.S.C. 185, and the Employee Retirement Income Security Act, 29 U.S.C. 1132. The district court ruled in plaintiffs’ favor as to employee coverage, but in favor of defendant as to spouses. The Sixth Circuit reversed in part, in favor of plaintiffs. Although healthcare is a “welfare benefit,” not entitled to the same ERISA protection as pension benefits, employers are free to waive their power to alter welfare benefits. Defendant did so by offering vested healthcare coverage to retired employees and spouses, and by agreeing that CBAs could only be modified with signed, mutual consent of the parties. View "Moore v. Menasha Corp." on Justia Law

Multiemployer pension plans are created by collective bargaining agreements to provide benefits to employees of different firms. When an employer withdraws from an MPP, the plan remains liable to employees who have vested pension rights, but can no longer look to the employer to cover these obligations. The Multiemployer Pension Plan Amendments Act, 29 U.S.C. 1381-1461, assesses the employer with an exit price equal to its pro rata share of the funding shortfall (difference between present value of fund assets and present value of future obligations). Estimating the shortfall depends on estimating the amount by which current assets can be expected to grow with compound interest. To avoid having an employer new to a plan inherit withdrawal liability where existing members failed to fund the plan adequately in prior years, the statute creates default rules for assigning each employer a share of only so much of the shortfall as occurred while the employer was participating, 29 U.S.C. 1391(b)(2)-(4). Disputes about withdrawal liability are resolved by arbitration. The arbitrator in this case ruled that MMP trustees had over-assessed CPC’s withdrawal liability by $1,093,000. The district judge upheld the ruling. The Seventh Circuit affirmed, noting the “Hideous complexities” involved and its own lack of expertise. View "Chicago Truck Drivers, Helpers, & Warehouse Workers Union (Indep.) Pension Fund v. CPC Logistics, Inc." on Justia Law