Murphy v. Verizon Communications, Inc., 101414 FED5, 13-11117

Docket Nº:13-11117
Opinion Judge:PER CURIAM
Party Name:PHILIP A. MURPHY, JR.; SANDRA R. NOE; CLAIRE M. PALMER, Individually and as Representative of plan participants and plan beneficiaries of Verizon's Pension Plans involuntarily re-classified and treated as transferred into IDEARC's Pension Plans, Plaintiffs-Appellants v. VERIZON COMMUNICATIONS, INCORPORATED; VERIZON EMPLOYEE BENEFITS COMMITTEE; VERI
Judge Panel:Before KING, GRAVES, and HIGGINSON, Circuit Judges.
Case Date:October 14, 2014
Court:United States Courts of Appeals, Court of Appeals for the Fifth Circuit
 
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PHILIP A. MURPHY, JR.; SANDRA R. NOE; CLAIRE M. PALMER, Individually and as Representative of plan participants and plan beneficiaries of Verizon's Pension Plans involuntarily re-classified and treated as transferred into IDEARC's Pension Plans, Plaintiffs-Appellants

v.

VERIZON COMMUNICATIONS, INCORPORATED; VERIZON EMPLOYEE BENEFITS COMMITTEE; VERIZON PENSION PLAN FOR NEW YORK AND NEW ENGLAND ASSOCIATES; VERIZON MANAGEMENT PENSION PLAN; SUPERMEDIA EMPLOYEE BENEFITS COMMITTEE, formerly known as Idearc Employee Benefits Committee; VERIZON CORPORATE SERVICES GROUP, INCORPORATED; VERIZON ENTERPRISES MANAGEMENT PENSION PLAN; VERIZON PENSION PLAN FOR MID-ATLANTIC ASSOCIATES, Defendants-Appellees

No. 13-11117

United States Court of Appeals, Fifth Circuit

October 14, 2014

Appeal from the United States District Court for the Northern District of Texas USDC No. 3:09-CV-2262

Before KING, GRAVES, and HIGGINSON, Circuit Judges.

PER CURIAM [*]

This suit arises from the November 17, 2006 spin-off of Verizon Communications Inc.'s information services unit into a new corporation called Idearc, Inc., which subsequently evolved into SuperMedia, Inc. The spin-off is described in greater detail in U.S. Bank National Association v. Verizon Communications, Inc., No. 13-10752, 2014 WL 3746476, __F.3d__ (5th Cir. 2014). In 2009, several retirees whose pension benefits were transferred from Verizon pension plans to Idearc pension plans as part of the spin-off— Appellants Philip A. Murphy, Jr., Sandra R. Noe, and Claire M. Palmer— brought a class action suit against Appellees—Verizon, the Idearc (and later the SuperMedia) pension plans, and the Verizon pension plans—asserting a variety of claims under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001, et seq. The claims arose from the Verizon Appellees' alleged breach of their duties to the plan during the spin-off, as well as Appellees' alleged failure to turn over certain documents and disclose certain information to the retirees.

I. Appellants' ERISA Claims

The district court resolved Appellants' claims under ERISA Sections 406(b)(2) and (b)(3), 29 U.S.C. §§ 1106(b)(2) and (b)(3), ERISA Section 404(a)(1), 29 U.S.C. § 1104(a)(1), 1 and ERISA Section 102(b), 29 U.S.C. § 1022(b), in a thorough and well-reasoned Memorandum Opinion and Order, granting Appellees' motions for summary judgment and denying Appellants' partial motion for summary judgment. We affirm the grant of summary judgment on these claims for essentially the reasons expressed in the Memorandum Opinion and Order.

Appellants' claims under ERISA Section 104(b)(4), 29 U.S.C. § 1024(b)(4), and ERISA Section 404(a)(1), 29 U.S.C. § 1104(a)(1), relating to Appellees' failure to produce certain documents, were dismissed under Rule 12(b)(6) in a separate Memorandum Opinion and Order filed October 18, 2010. We address those claims below.

A. ERISA Section 104(b)(4)

Under ERISA Section 104(b)(4), plan administrators must, "upon written request of any participant or beneficiary, furnish a copy of the latest updated summary[] plan description, and the latest annual report, any terminal report, the bargaining agreement, trust agreement, contract, or other instruments under which the plan is established or operated." 29 U.S.C. § 1024(b)(4). If a plan administrator fails to comply with this requirement, the district court has discretion to impose a penalty of up to $110 per day. 29 U.S.C. § 1132(c)(1)(B); 29 C.F.R. § 2575.502c–1.

Appellants contend that the documents they sought from Appellees fall under Section 104(b)(4)'s catch-all clause, i.e., that they constitute "other instruments under which the plan is established or operated." 29 U.S.C. § 1024(b)(4). As an initial matter, in their first amended complaint, Appellants alleged that Appellees failed to turn over a variety of documents—including actuarial reports, IRS approvals and qualifications, and investment guidelines. However, in their opening brief on appeal, Appellants discuss only Appellees' failure to produce investment guidelines as supporting a violation of Section 104(b)(4). Therefore, we will only consider Appellants' claims with respect to these documents, as arguments not raised in an opening brief on appeal are waived. See Steering Comm. v. Wash. Grp. Int'l, Inc. (In re Katrina Canal Breaches Litig.), 620 F.3d 455, 459 n.3 (5th Cir. 2010).

This circuit has not directly addressed the scope of Section 104(b)(4)'s catch-all clause. However, other circuits have—and they have differed in their interpretations of the clause. The Sixth Circuit has adopted what appears to be a minority view, construing the clause broadly. In Bartling v. Fruehauf Corp., 29 F.3d 1062 (6th Cir. 1994), a company informed its employees of its pending sale and replaced a previous pension plan for its employees with a new plan. The original plan's participants requested certain plan-related documents, some of which the company refused to provide. Id. at 1065–66. The participants sued, arguing that they were entitled, under Section 104(b)(4), to: (1) actuarial valuation reports; (2) portions of the purchase agreement relating to pension and welfare benefits; and (3) the calculation procedure used to compute benefits. Id. at 1069. The Sixth Circuit concluded on appeal that "[b]ecause an actuarial valuation report is required for every third plan year, § 1023(d), these reports are indispensable to the operation of the plan." Id. at 1070. The court further noted that "the purpose of ERISA's disclosure requirements is to ensure that 'the individual participant knows exactly where he stands with respect to the plan.'" Id. at 1070 (quoting Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 118 (1989)). Therefore, "all other things being equal, courts should favor disclosure where it would help participants understand their rights." Id. The Sixth Circuit also found that the plan administrator was required under Section 104(b)(4) to produce the calculation procedure for computing benefits, although the court did not provide any explanation as to why such documents fell under the catch-all provision. Id. at...

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