32 F.3d 180 (5th Cir. 1994), 94-10199, Shanbaum v. United States

Docket Nº:94-10199
Citation:32 F.3d 180
Party Name:Theodore SHANBAUM, Plaintiff-Appellant, v. UNITED STATES of America and the Pension Benefit Guaranty Corporation, Defendants-Appellees.
Case Date:September 16, 1994
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit

Page 180

32 F.3d 180 (5th Cir. 1994)

Theodore SHANBAUM, Plaintiff-Appellant,


UNITED STATES of America and the Pension Benefit Guaranty

Corporation, Defendants-Appellees.

No. 94-10199

United States Court of Appeals, Fifth Circuit

September 16, 1994

Page 181

Joe B. Abbey, Dallas, TX, for appellant.

Nancy S. Heermans and Ralph L. Landy, Washington, DC, for Pension Benefit Guar. Corp.

Paul E. Coggins, U.S. Atty., Dallas, TX, Gary R. Allen, Chief, Billie L. Crowe, and Ann B. Durney, Attys., Appellate Section, Tax Div., U.S. Dept. of Justice, Washington, DC, for the U.S.

Appeal from the United States District Court for the Northern District of Texas.

Before GARWOOD, HIGGINBOTHAM and DAVIS, Circuit Judges.


Theodore Shanbaum appeals the district court's dismissal of his suit against both the United States and the Pension Benefit Guaranty Corporation ("PBGC"). We affirm the decision of the lower court.


Theodore Shanbaum is a beneficiary of the Lee Optical and Associated Companies Pension Plan ("the Plan"), a qualified pension plan under the Employment Retirement Income Security Act ("ERISA"). Shanbaum retired in 1978 and began receiving pension benefits. In 1991, the Plan was terminated and PBGC was appointed trustee of the Plan. 1 On June 24, 1991 the Plan's prior trustee notified Shanbaum that his pension would be reduced to the Title IV guaranteed amount. Shanbaum began receiving an estimated monthly pension benefit of approximately $734.00 from the PBGC, pending an initial determination of his guaranteed benefit. Shanbaum has not yet received his initial benefit determination from PBGC.

On October 17, 1992, the Internal Revenue Service ("IRS") levied upon Shanbaum's pension benefits in order to collect his unpaid income taxes for tax years 1974 through 1982, excluding 1979. The levy was served on State Street Bank of Massachusetts, PBGC's paying agent. Since the levy, Shanbaum has not received any of his monthly pension benefits because they are being paid to the IRS.

Shanbaum filed suit against the United States seeking damages and declaratory relief on the grounds that the IRS levy violated ERISA. Shanbaum also filed a claim against PBGC alleging that PBGC paid him less than the full amount of his guaranteed pension benefit under the Plan and that PBGC improperly honored the IRS notice of levy.

PBGC moved to dismiss Shanbaum's complaint, and the district court granted the

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motion on the grounds that Shanbaum had not exhausted his administrative remedies regarding the amount of his guaranteed benefit. See 29 C.F.R. Sec. 2606.7 ("[A] person aggrieved by an initial determination of the PBGC ... has not exhausted his or her administrative remedies until he or she has filed a request for reconsideration ... or an appeal ... and a decision granting or denying the relief requested has been issued."). Shanbaum has not appealed this issue. Issues not raised by the appellant are normally not considered on appeal, and, in any event, the district court's ruling on this issue was correct.

In its order dismissing Shanbaum's cause against PBGC, the lower court did not address the merits of Shanbaum's claim that PBGC breached its fiduciary duty to protect Plan assets...

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