DeWitt v. Penn-Del Directory Corp.

• Decision Date: 22 December 1994
• Docket Number: Civ. A. No. 93-581 MMS.
• Citation: 872 F. Supp. 126
• Parties: Carol DEWITT, Plaintiff, v. PENN-DEL DIRECTORY CORPORATION, a foreign corporation; National Telephone Directory Corporation Profit Sharing Plan, and National Telephone Directory Corporation, Plan Administrator of Profit Sharing Plan, Defendants.
• Court: U.S. District Court — District of Delaware

872 F. Supp. 126

Carol DEWITT, Plaintiff, v. PENN-DEL DIRECTORY CORPORATION, a foreign corporation; National Telephone Directory Corporation Profit Sharing Plan, and National Telephone Directory Corporation, Plan Administrator of Profit Sharing Plan, Defendants.

Civ. A. No. 93-581 MMS.

United States District Court, D. Delaware.

December 22, 1994.

COPYRIGHT MATERIAL OMITTED

John M. Stull, Wilmington, DE for plaintiff.

David H. Williams, of Morris, James, Hitchens & Williams, Wilmington, DE; of counsel: Francis M. Milone, and Stacy K. Weinberg, of Morgan, Lewis & Bockius, Philadelphia, PA for defendants.

OPINION

MURRAY M. SCHWARTZ, Senior District Judge.

I. Introduction

Defendants have moved pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure to dismiss plaintiff Carol DeWitt's complaint for failure to state a claim upon which relief can be granted. Plaintiff pleads two causes of action under the Employee Retirement Income Security Act ("ERISA"). Defendants assert that Count I of plaintiff's complaint does not entitle plaintiff to the relief requested and that Count II of her complaint is barred by the applicable statute of limitations. In response, plaintiff has filed a motion for summary judgment. This Court has jurisdiction pursuant to 29 U.S.C. § 1132(e)(1) and 29 U.S.C. § 1132(f). For the reasons that follow, the Court will grant in part and deny in part defendants' Rule 12(b)(6) motion and will deny plaintiff's motion for summary judgment.

II. Background

When addressing a motion to dismiss for failure to state a claim, the Court must construe the complaint favorably to the plaintiff and accept the complaint's well-pleaded allegations as true. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974); In re Donald J. Trump Casino Sec. Litig. — Taj Mahal Litig., 7 F.3d 357, 366 (3d Cir.1993), cert. denied sub nom. Gallomp v. Trump, ___ U.S. ___, 114 S.Ct. 1219, 127 L.Ed.2d 565 (1994). The court may generally consider only the facts alleged in the complaint and cannot refer to other parts of the record, In re Donald J. Trump Casino Sec. Litig. — Taj Mahal Litig., 7 F.3d at 366, although the Court "may also consider an undisputedly authentic document that a defendant attaches as an exhibit to a motion to dismiss if the plaintiff's claims are based on the document." Pension Benefit Guar. Corp. v. White Consol. Indus., Inc., 998 F.2d 1192, 1196 (3d Cir.1993), cert. denied, ___ U.S. ___, 114 S.Ct. 687, 126 L.Ed.2d 655 (1994). If the Court considers materials other than the well-pleaded complaint and the materials permitted by Pension Benefit Guar. Corp. v. White Consol. Indus., the Court must evaluate a Rule 12(b)(6) motion as a motion for summary judgment. See Fed.R.Civ.P. 12(b).

In this case, defendants have submitted the National Telephone Directory Corporation Profit Sharing Plan Amendment and Restatement (the "Plan") as an Appendix to their motion, Docket Item ("D.I.") 9, and both parties have discussed and relied upon the Plan provisions to support their respective arguments. The Court therefore concludes the Plan is undisputedly authentic, particularly as neither party has questioned the Plan's authenticity in the course of discussing and relying upon it. The Court also finds plaintiff's complaint necessarily based on the Plan, as plaintiff claims the defendants have denied plaintiff her rights under the Plan. See D.I. 1, ¶¶ 14-15. On these bases, the Court has gleaned the following factual background from the well-pleaded facts of the plaintiff's complaint, D.I. 1, and the Profit Sharing Plan document, D.I. 9.

Defendant Penn-Del Directory Corporation ("Penn-Del") employed plaintiff Carol DeWitt ("DeWitt") for approximately 10 years beginning on March 9, 1981. PennDel terminated plaintiff's employment on December 12, 1990. During the period of her employment at Penn-Del, plaintiff participated in the National Telephone Directory Corporation Profit Sharing Plan ("the Plan"), which is administered by National Telephone Directory Corporation ("National"). In addition to Penn-Del, plaintiff has named the Plan and National as defendants in this suit. At the time Penn-Del terminated plaintiff, plaintiff was 100% vested in her Plan Account.

In relevant part, the Plan document provides that each participant shall have a separate "Account" to record each participant's interest in the Plan. D.I. 9 at A-20, ¶ 6.01. The Plan provides for adjustments to individual accounts as of the Valuation Date each year, id. at A-20, ¶ 6.02, which the Plan defines as the last business day of each December, id. at A-11, ¶ 1.42. On the Valuation Date, individual accounts are adjusted "by the amount of Employer Contributions, if any, properly credited to such Account since the preceding Valuation Date," id. at A-20, ¶ 6.02(c), and "by the amount of Forfeitures, if any, properly credited (or charged) to such Account since the preceding valuation date," id. at A-20, ¶ 6.02(d). Further, on the Valuation Date, individual accounts are "allocated the net increase or decrease in the fair market value of the Trust assets (resulting from income, gain, loss and expense since the preceding Valuation Date) to each Account invested in the Trust on the basis of Account balances in a uniform and consistent manner" (hereinafter "trust income"). Id. at A-20, ¶ 6.02(e). Furthermore, to become eligible for Employer Contribution and Forfeiture adjustments, the Plan also requires participants to be "in the employ of Penn-Del on the last day of such Plan Year." Id. at A-17-A-18, ¶¶ 5.01-5.02. To become eligible for trust income, however, the Plan does not indicate that participants must be "in the employ of Penn-Del on the last day of such Plan Year."

Upon her termination, plaintiff sought to withdraw the assets contained in her Plan Account. Penn-Del Division Manager Victor Raad ("Raad") advised plaintiff that it would take between 30 and 90 days to disburse plaintiff's Plan Account funds and that the Plan would credit her Account with a share of the 1990 Plan Year Employer Contributions, Plan Forfeitures, and trust income. Plaintiff requested her final distribution on December 14, 1990. D.I. 1 at ¶ 9.

Notwithstanding Raad's assertions, plaintiff received her Plan distribution on December 28, 1990, 16 days following her termination and 14 days following her request. Plaintiff's account had a net balance of $75,520.88 at the time of the December 28 distribution. She received this entire amount and the Plan closed her Account. More importantly to plaintiff, her distribution did not include any 1990 Employer Contributions, Plan Forfeitures, or trust income. In Count I of her complaint, plaintiff asserts that she did had a right under the Plan to receive the 1990 Plan Year Employer Contributions, Plan Forfeitures, and trust income allowable to her account. In Count II, plaintiff asserts that defendants discharged her to prevent her from qualifying for the 1990 Employer Contribution, Plan Forfeitures, and trust income allowable to her account.

III. Defendants' Rule 12(b)(6) Motion

The issue presented by a Rule 12(b)(6) motion "is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974). For that reason, a court should not grant a motion made pursuant to Rule 12(b)(6) unless "it is clear that no relief could be granted under any set of facts that could be proved consistent with the plaintiff's allegations." Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 2232, 81 L.Ed.2d 59 (1984); Jordan v. Fox, Rothschild, O'Brien & Frankel, 20 F.3d 1250, 1261 (3d Cir.1994). The moving party holds the burden of persuasion under this standard. Johnsrud v. Carter, 620 F.2d 29, 33 (3d Cir.1980).

A. Count I

In Count I, plaintiff has alleged that defendants violated 29 U.S.C. § 1132(a)(1)(B), ERISA § 502(a)(1)(B). ERISA § 502(a)(1)(B) permits an ERISA plan participant or beneficiary to bring a civil action "to recover benefits due to him under the terms of his plan, or to enforce his rights under the terms of the plan." Plaintiff asserts two bases of liability in support of her § 502(a)(1)(B) claim. First, plaintiff asserts that the defendants "arbitrarily and capriciously denied additional accrued benefits to plaintiff's account balance in the Plan for the plan year 1990 by having her benefits paid on an expedited basis by the plan administrator, contrary to Plan provisions." D.I. 1, ¶ 16. Second, plaintiff asserts that the defendants acted arbitrarily by denying Employer Contributions, Plan Forfeitures, and trust income to plaintiff, while previously giving a different terminated employee, Stephen Byrne, a share of those same benefits even though that person was not employed at the end of the plan year. Id.

Defendants' Rule 12(b)(6) challenges are two-fold. First, defendants argue that plaintiff does not state a claim under ERISA § 502(a)(1)(B) because she does not qualify under the Plan documents for either Employer Contributions or Plan Forfeitures. If the plaintiff does not qualify for these monies, the defendants argue, then the "expedited" date of plaintiff's final distribution is irrelevant to the issue of whether plaintiff had a right to receive 1990 Plan Year Employer Contributions and Plan Forfeitures. The Court concludes defendants are correct on this point. First, the Plan documents require the plan participant to be employed by the company on the Valuation Date to qualify for these benefits. D.I. 9 at A-18, ¶¶ 5.01-5.02. Second, no provision in the Plan indicates the Plan Administrator had discretion in the allocation of Employer Contributions or Plan Forfeitures. Third, plaintiff admits in her complaint that only those participants still employed on the Valuation Date are entitled to Employer Contributions and Plan Forfeitures in a calendar year,...