978 F.2d 265 (6th Cir. 1992), 91-3853, Rinard v. Eastern Co.
|Citation:||978 F.2d 265|
|Party Name:||Carl RINARD, and all others similarly situated, Plaintiffs-Appellants, v. EASTERN COMPANY, Eastern Company Pension Plan for Hourly-Rated Employees of The Pattin Manufacturing Company Division, the Colonial Bank, Defendants-Appellees.|
|Case Date:||October 28, 1992|
|Court:||United States Courts of Appeals, Court of Appeals for the Sixth Circuit|
Argued April 2, 1992.
David Goldman, United Steelworkers of America, Pittsburgh, Pa., Timothy F. Cogan, Patrick S. Cassidy, O'Brien, Cassidy & Galagher, Wheeling, W.Va., William T. Payne (argued and briefed), Schwartz, Steinsapir, Dohrmann & Sommers, Los Angeles, Ca., for plaintiffs-appellants.
Juan Jose Perez (argued), Richard A. Frye (briefed), Schwartz, Kelm, Warren & Rubenstein, Columbus, Ohio, for defendants-appellees.
Before: MILBURN and SUHRHEINRICH, Circuit Judges; and COHN, District Judge. [*]
COHN, District Judge.
This is a class action under the Employee Retirement Income Security Act (ERISA). 29 U.S.C. § 1001, et seq. Plaintiffs-Appellants (Rinard) are ninety three former employees or the surviving spouses of former employees of the Pattin Manufacturing Company Division (Pattin Division) of Defendant-Appellee Eastern Company (Eastern). Also Defendants-Appellees are the Eastern Company Pension Plan for Hourly-Rated Employees of the Pattin Manufacturing Company (Plan), established under the collective bargaining agreement between the United Steelworkers of America (Union) and Eastern, and The Colonial Bank (Colonial), the trustee named in the funding mechanism provision of the Plan. Rinard claims that Eastern breached the collective bargaining agreement and also violated ERISA by taking for itself the surplus monies in the Plan after the purchase of annuities for Rinard on the termination of operations of Eastern's Pattin Division. The District Court, concluding that the surplus monies belonged to Eastern, granted Eastern summary judgment. Rinard v. Eastern Company, 769 F.Supp. 1416 (S.D.Ohio 1991). This appeal followed.
The Plan was unilaterally created in 1957, at a time when Eastern was non-unionized. The Plan as originally written provided for reversion of surplus assets to Eastern, stating, in relevant portion:
The Plan may be terminated at any time by the Board of Directors, in which event all of the funds of the Plan after providing the expenses of the Plan shall be used for the benefit of covered employees and pensioners, and for no other purpose, except that any funds not required to satisfy all liabilities of the Plan for pensions because of erroneous actuarial computations shall be returned to the Company.
The Plan utilized a previously created Agreement and Indenture of Trust (Trust Agreement) signed in 1952 between the Eastern Malleable Iron Company (now The Eastern Company) and The Hanover Bank as a funding mechanism. Three pension plans covering various employees groups of Eastern were described in the Trust Agreement as utilizing it as a funding mechanism. The Trust Agreement provided:
All amounts received by the Trustee from the Company under the Agreement shall constitute a single fund and may be comingled.
The Trust Agreement directed the Trustee to make payments from the funds held by the Trustee upon written demand of the retirement boards of the respective plans utilizing the Trust Agreement for funding.
The Trust Agreement also provided that any surplus funds remaining on hand after satisfaction of the obligations of a particular Plan were to be returned to Eastern. Particularly, the Trust Agreement stated:
The Company reserves the right, at any time and from time to time, by action of its Board of Directors, to modify or amend in whole or in part, any or all of the provisions of this agreement, provided that no such modification or amendment shall be effective until filed with the Trustee and until the Company certifies to the Trustee that such modification...
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