Bidwill v. Garvey, s. 91-2308
| Decision Date | 28 October 1991 |
| Docket Number | Nos. 91-2308,s. 91-2308 |
| Citation | 943 F.2d 498 |
| Parties | 91-2 USTC P 50,430, 119 Lab.Cas. P 10,908, 14 Employee Benefits Cas. 1449 William V. BIDWILL; James Kensil; Michael Lynn, Individually and as members of the Retirement Board of the Bert Bell NFL Player Retirement Plan appointed by the National Football League Management Council pursuant to section 8.1(B) of the Plan, Plaintiffs-Appellants, National Football League Management Council; The Five Smiths, Inc., d/b/a Atlanta Falcons; Buffalo Bills, Inc., d/b/a Buffalo Bills; Chicago Bears Football Club, Inc., d/b/a Chicago Bears; Cincinnati Bengals, Inc., d/b/a Cincinnati Bengals; Cleveland Browns, Inc., d/b/a Cleveland Browns; Dallas Cowboys Football Club, Inc., d/b/a Dallas Cowboys; PDB Sports, Ltd., d/b/a Denver Broncos; The Detroit Lions, Inc., d/b/a Detroit Lions; The Green Bay Packers, Inc., d/b/a Green Bay Packers; Houston Oilers, Inc., d/b/a Houston Oilers; Indianapolis Colts, Inc., d/b/a Indianapolis Colts; Kansas City Chiefs Football Club, Incorporated, d/b/a Kansas City Chiefs; The Los Angeles Raiders, Ltd., d/b/a Los Angeles Raiders; Los Angeles Rams Football Company, Inc., d/b/a Los Angeles Rams; Miami Dolphins, Ltd., d/b/a Miami Dolphins; Minnesota Vikings Football Club, Inc., d/b/a Minnesota Vikings; New England Patriots Football Club, Inc., d/b/a New England Patriots; The New Orleans Saints, d/b/a New Orleans Saints; New York Football Giants, Inc., d/b/a New York Giants; New York Jets Football Club, Inc., d/b/a New York Jets; The Philadelphia Eagles Football Club, Inc., d/b/a Philadelphia Eagles; Pittsburgh Steelers Sports, Inc., d/b/a Pittsburgh Steelers; Chargers Football Company, d/b/a San Diego Chargers; San Francisco Forty-Niners, Ltd., d/b/a San Francisco 49ers; Seattle Professional Football, d/b/a Seattle Seahawks; St. Louis Football Cardinals Co., d/b/a St. Louis Cardinals; Tampa Bay Area NFL Football, Inc., d/b/a Tampa Bay Buccaneers; Pro-Football, Inc., d/b/a Washington Redskins, Defendants-Appellants, v. Edward R. GARVEY; Tom Condon; Danny M. J |
| Court | U.S. Court of Appeals — Fourth Circuit |
Lee Thomas Ellis, Jr., Baker & Hostetler, College Park, Md., argued (Jeffery Pash, Covington & Burling, Washington, D.C., Sargent Karch, Leonard H. Freiman, Douglas E. Lee, Baker & Hostetler, Washington, D.C., George Beall, Hogan & Hartson, Baltimore, Md., on the brief), for plaintiffs-appellants.
Joseph Andrew Yablonski, Yablonski, Both & Edelman, Washington, D.C., argued (Daniel B. Edelman, John F. Colwell, Yablonski, Both & Edelman, Washington, D.C., Robert V. Atmore, Luke H. Terhaar, Lindquist & Vennum, Minneapolis, Minn., on the brief), for defendants-appellees.
Before WILKINSON, Circuit Judge, CHAPMAN, Senior Circuit Judge, and HILTON, District Judge for the Eastern District of Virginia, sitting by designation.
This case arises from a protracted dispute among trustees of a pension plan for professional football players. The trustees chosen by the football players and those chosen by the club owners have been unable to agree on, among other things, the scope of their powers, the interpretation of their authorizing document and the amount of money the clubs owe to the pension fund. The district court held that the football clubs owed some $18 million in delinquent payments to the pension plan and additionally held liable for the same amount the trustees selected by the club owners for breaching their fiduciary duties. We agree that the clubs failed to make their full contributions but we do not believe the conduct of the trustees for the owners constituted a breach of their fiduciary obligations. We thus affirm in part and reverse in part the judgment of the district court.
This controversy revolves around the Bert Bell National Football League Player Retirement Plan, a pension and benefit trust for members of the National Football League Players Association. The Plan is structured pursuant to the Taft-Hartley Act, see 29 U.S.C. § 186(c)(5), and the Employee Retirement Income Security Act (ERISA), see 29 U.S.C. §§ 1001-1461. The Players Association selects three members of the Plan's board while the National Football League Management Council, an organization of NFL team owners, selects another three trustees. The player trustees included a former executive director of the Players Association and two former players. The owner or management trustees included one team owner, a team president and a team executive vice president. The Commissioner of the National Football League is a seventh, but non-voting, member of the Board.
In 1982, the Players Association and Management Council negotiated a new collective bargaining agreement (CBA). The owners agreed to contribute $12.5 million to the Plan each year for five years, "provided that such contributions are allowable as deductions under the applicable provisions of the Internal Revenue Code." The first payment was due on March 31, 1983, and the last was due on March 31, 1987. The CBA also directed the Board to set benefits at enumerated levels. Under the prior CBA, the owners' contributions to the Plan had also been set but the benefit levels were to be determined periodically by the Board to reflect prevailing conditions and actuarial predictions. When the Board first met in 1983, it adopted the preset benefit levels contained in the 1982 CBA, as well as the contribution levels.
Because the Plan's investments during the early 1980's produced greater returns than expected, the Plan became overfunded. In March 1984, the owners paid only $7.5 million into the Plan instead of the planned $12.5 million. The additional $5 million represented funds that the owners believed were not owed because they were not, in the owners' view, immediately deductible under the Internal Revenue Code due to...
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