Anderson v. Board of Trustees of Northwest Ohio
| Decision Date | 28 July 2008 |
| Docket Number | Case No. 3:07 CV 576. |
| Citation | 567 F.Supp.2d 991 |
| Parties | Paul H. ANDERSON, etc., Plaintiff, v. BOARD OF TRUSTEES OF the NORTHWEST OHIO UNITED FOOD AND COMMERCIAL WORKERS UNION AND EMPLOYERS' JOINT PENSION FUND, Defendant. |
| Court | U.S. District Court — Northern District of Ohio |
Barry W. Fissel, Connie S. Swemba, Eastman & Smith, Toledo, OH, for Plaintiff.
Lee J. Hutton, Barry Y. Freeman, Littler Mendelson, Cleveland, OH, for Defendant.
This matter is before the Court on cross-motions for summary judgment (Doc. 38, 41). This Court has jurisdiction pursuant to 28 U.S.C. § 1331.
Defendant Board of Trustees of the Northwest Ohio United Food and Commercial Workers Union and Employers' Joint Pension Fund ("the Fund" or "the Plan") is a multiemployer pension plan, as defined by the Employee Retirement Income Security Act ("ERISA"). The Plan administrator was National Employee Benefit Administrators ("NEBA"). The Fund covers current and retired union employees who work or worked for Kroger grocery stores in Northwest Ohio, and it provides pension benefits to retirees per the terms of its plan. Its sister fund is an ERISA Health and Welfare ("H & W") Plan. The H & W Fund provides health insurance and disability insurance to current employees at Northwest Ohio grocery stores. The H & W Fund is not a party to the present case; the Pension Fund is the sole defendant.
Plaintiff Paul Anderson is the brother and executor of the estate of Allen Anderson ("Allen"), who was a participant in both funds and an employee of The Kroger Company ("Kroger") until his death. As a career employee of Kroger, Allen was a member of the United Food and Commercial Workers Union ("UFCW") and as such was a participant in the Plan.
After more than thirty years as a stock-person at Kroger, Allen was diagnosed with lung and brain cancer in July 2005, and soon after learned from his oncologist that his cancer was inoperable and terminal. Thereafter, Allen, unmarried and with no children, updated his last will and testament to leave everything that he could to his heirs, which included Plaintiff Paul.
Allen took a medical leave of absence from Kroger on July 27, 2005 and in doing so was entitled to six months of disability pay and three months of free health insurance. As medical bills began to mount and the need to conserve income to pay for future cancer treatments became clearer, Allen successfully appealed to the H & W Fund to repay his necessary bills associated with prescriptions not available or covered at the Kroger pharmacy.
Allen contacted his union agent, Karen McHugh, who along with the Fund's NEBA liaison, Jan Palmison, informed Allen that he had three options: (1) Return to active status with Kroger for two weeks. After two weeks on active status, Anderson could take another leave of absence —with six more months of disability pay ($225 per week) and restart the clock for three additional months of free health insurance; (2) Retire and receive retiree health insurance. However, the coverage provided was not an attractive option to someone faced with expensive medical treatments on the horizon; or (3) Retire and continue his current health insurance for eighteen months by paying for it through COBRA, at a cost of $755 per month.
Palmison did not inform Allen about another pension option, the Ten-Year Certain Option, beyond listing its name among other retirement options. Allen told Palmison that he had no intention of retiring, and that he wanted to win his battle with cancer and return to his job at Kroger. Palmison took this to mean Allen was focused on learning more about insurance options and not about retirement options, although Palmison did recognize that one of Allen's concerns was not leaving his parents with the burden of paying his medical bills. Palmison Depo. at 31-2, 36-8, 50-2, 64-7, 145, 164, 173, 237-8, 242-4, 310, 324, 339; McHugh Depo. 23-5, 34-5, 40, 43, 45, 50, 84. Finally, in October 2005, Allen wrote that he needed to return to work so that he could extend his health insurance another ninety days, given the high cost of COBRA. Anderson Depo., Ex. O at 2.
At an October 14, 2005 meeting arranged by McHugh, Allen and McHugh discussed retirement, and McHugh provided Allen a blank pension application form from the Pension Fund, in the event that he changed his mind and decided to retire. McHugh Depo. at 27, 29, 24-40, 42, 47, 50; Palmison Depo. at 25-26. McHugh explained to Allen that he could complete the pension application and instruct the Pension Fund to hold his application, rather than acting on it, which could expedite the process if Allen changed his mind about retirement. McHugh Depo. at 34-36, 42, 47. Allen agreed, as he worried about his deteriorating penmanship, but reiterated that he did not want to retire. Id. at 35-36, 42. McHugh assured Allen that the Pension Fund would not process his retirement papers unless he called and authorized the Fund to do so. Id. at 35, 42, 47, 50-51. Allen thereby signed the pension application. Id. at 40.
To meet Allen's needs, his doctor and Kroger arranged for him to return to Kroger's active payroll from October 22 through November 1, during which time Allen received vacation pay under the pretense that on November 2, he would commence another leave of absence. Anderson Depo. at 42-45, Exs. E-G; McHugh Depo. at 25-9, 31-2; Palmison Depo. at 38, 46-48, 65-68, 60, 69-73, 118-20, Exs. 9-10. By returning to active status with Kroger, Allen was able to extend his health insurance through February 2006 and his disability pay through May 8, 2006. Pahnison Depo. at 37-38, 42, 57, 119-20, 123, 278, Ex. 10; McHugh Depo. at 25-6; Anderson Depo. at 16-17, 44-47, Exs. F-G. Consequently, however, Defendant contends that Allen could not become eligible for any retirement benefit under the Plan until December 1, 2005 or later. See Pension Plan/AR at 017-18, 024, 036-37 ().
Tragically, Allen Anderson lost his battle with cancer and passed away on November 23, 2005.
On December 2, 2005, Palmison received an email in response to an inquiry she made with a professional plan consulting firm. Palmison Depo., Pl. Ex. 15. It read that if an unmarried "person elects to retire before he dies, he can choose the 10 year certain option as a retirement payment form." Id. (emphasis in original). The Ten-Year Certain Option would have allowed Plaintiff's heirs to collect benefits after his death in an amount significantly greater than other options.
In late 2005 or early 2006, Plaintiff contacted Defendant to see what benefits were available to Allen's survivors. Because Allen was Kroger's employee at the time of his death, the H & W Fund paid $15,000 plus interest, in January 2006. Id. at 48-49, 51, Exs. H, K; H & W Plan at 026. However, confusion apparently arose over what retirement benefits were available. Doc. 39 at 5. The Fund's administrators were unsure whether a Ten-Year Certain Option, the sole provision for posthumous benefits for unmarried participants such as Allen, was available to Allen's estate or heirs. Palmison Depo. at 183-89, 194-98, 298-99, Ex. 17. After consulting with the Fund's actuary/consultant and its attorney, the Fund decided that Allen's estate and heirs could not posthumously elect a Ten-Year Certain Option because it was only available if a participant retired and received his first month's pension check before dying. Siepman Depo. at 5-8, 53-56; Pension Plan/AR at 017-18, 034, 036; Palmison Depo. at 183-89, 194-98, 202, 208-09, 298-99, Exs. 15, 17; AR at 139.
Plaintiff submitted a written claim for pension benefits on March 16, 2006. Anderson Depo. at 63-64, Ex. L at 6-8, AR at 140-42. Defendant maintains that because Allen was still an employee of Kroger when he died, and had not retired, his beneficiaries were not entitled to any retirement benefits. As a result of these findings, the Board of Trustees denied Plaintiff's claim in writing on March 28, 2006, and in doing so, provided his attorney with its Summary Plan Description ("SPD"). Anderson Depo. at Ex. K; AR 143-44. According to the SPD, any appeal had to be submitted within sixty days, or by May 27, 2005, which came and went without an appeal being filed.
On July 24, 2006, Plaintiff's attorney filed a new claim for retirement benefits, which Defendants maintain was a disguised untimely appeal. Doc. 39 at 6 (citing Anderson Depo. at 68-72, Exs. MN/AR 145-8). Nevertheless, on July 27, 2006, the Board of Trustees denied Plaintiff's claim. Palmison Depo. at 245-6, 336, Ex. 23/AR at 178, 179a.
On February 27, 2007, Plaintiff, individually and as the executor for Allen Anderson's estate, filed suit against Defendant. Plaintiff and Defendant both filed motions for summary judgment on April 7, 2008.
Although this is a case ostensibly relating to a denial of a claim for benefits pursuant to an ERISA plan, Plaintiff does not herein bring a claim for wrongful denial of benefits pursuant to ERISA § 502(a)(1)(B). As such, and as the parties agree in such event, the standard of review applicable to the resolution of these motions is that of summary judgment.
Summary judgment is appropriate where "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show there is no genuine issue as to any material fact and that the moving party is entitled to judgment as a matter of law." FED.R.CIV.P. 56(c). The moving party bears the initial responsibility of "informing the district court of the basis for its motion, and identifying those portions of 'the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any,' which it believes demonstrate the absence of a genuine issue of material fact." Celotex...
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