Miranti v. Amalgamated Indus. Toy & Novelty Workers of Am. Local 223
| Decision Date | 23 June 2022 |
| Docket Number | 19-CV-7077(JS)(AYS) |
| Court | U.S. District Court — Eastern District of New York |
| Parties | JOHNNIE MIRANTI, Plaintiff, v. AMALGAMATED INDUSTRIAL TOY & NOVELTY WORKERS OF AMERICA LOCAL 223; AMALGAMATED PRODUCTION & SERVICE EMPLOYEES UNION LOCAL 22; and INTERNATIONAL UNION OF ALLIED NOVELTY & PRODUCTION WORKERS, AFL-CIO, Defendants. |
For Plaintiff: Stephen Goldblatt, Esq.
For Defendants: Sheri Dorothy Preece, Esq. McCarthy & Preece PLLC.
On December 18, 2019, Johnnie Miranti (“Plaintiff”) initiated this action against Amalgamated Industrial Toy & Novelty Workers of America Local 223 (“Local 223”), Amalgamated Production & Service Employees Union Local 22 (“Local 22”), and International Union of Allied, Novelty & Production Workers, AFL-CIO (“International,” and together with Local 223 and Local 22, “Defendants”) alleging violations of the Employee Retirement Income Security Act of 1974 (“ERISA”), breach of contract, unjust enrichment, and promissory estoppel based on Defendants' decision to deny Plaintiff access to certain union medical and severance benefits. Pending before the Court are the parties' cross-motions for summary judgment. (Defs. Mot ECF No. 25; Defs. Support Memo, ECF No. 25-2; Defs. Reply ECF No. 29; Pl. Opp'n, ECF No. 28.) For the following reasons, Defendants' motion is GRANTED, and Plaintiff's motion is DENIED.
Unless otherwise noted, the following facts are undisputed.[1] I Facts
A. Background and Plaintiff's Indictment
International is a national labor union that represents workers in many industries, including general manufacturing. International is divided into multiple locals within the five boroughs of New York City, such as Local 223.[2] (See Am. Compl., ECF No. 16-2, ¶¶ 4-6.) Plaintiff was employed by Local 223 for approximately twenty years, from 1996 until August 16, 2016. (Defs. 56.1 Stmt. ¶ 1.) During that time, Plaintiff served as Recording Secretary-Treasurer and an Executive Board member. (Am. Compl. ¶ 11.) In this role, Plaintiff drafted all the meeting minutes. (Defs. 56.1 Stmt. ¶ 15.)
On July 1, 2015, Plaintiff was indicted for his participation in a kickback scheme related to his role as Trustee to the Local 223 Sick Benefit Fund. (Defs. 56.1 Stmt. ¶ 2); see also United States v. Miranti, No. 15-CR-0415 (S.D.N.Y.). The grand jury indicted Plaintiff on three counts for conspiracy to defraud the United States in violation of 18 U.S.C. § 371, including: (1) conspiracy to solicit and receive kickbacks to influence the operation of an employee benefit plan; (2) conspiracy to embezzle from an employee benefit plan; and (3) conspiracy to commit theft or embezzlement in connection with a health care benefit program. (Defs. 56.1 Stmt. ¶ 2.) At a July 15, 2015, Local 223 Executive Board meeting, Plaintiff informed the Executive Board of his indictment and stated that the allegations in the indictment were untrue. (Id. ¶ 3.) Defendants assert that Plaintiff “continuously professed his innocence to the Executive Board and never informed the Executive Board when he began negotiating a plea deal.” (Id. ¶ 4.)
B. The Benefit Programs at Issue
Plaintiff claims that he is entitled to funds or coverage under three separate welfare employee benefit plans: (1) the Local 223 Severance Policy; (2) the Local 223 Lifetime Medical Benefits Policy; and (3) the International Non-Qualified Deferred Compensation (“NQDC”) Plan.
Local 223's Severance Policy entitles its members to receive severance “upon termination of office of employment by reasons of death, disability, or resignation.” (Defs. 56.1 Stmt. ¶ 13.) The severance is paid out in weekly installments over a thirty-six-month period. (Id.) After Plaintiff's indictment, at a November 28, 2015 “special membership meeting” held to amend Local 223's Constitution and Bylaws, Plaintiff proposed a modification to the Severance Policy. (Id. ¶ 14.) Specifically, Plaintiff requested the Severance Policy be amended to include officers who were terminated “for any reason.” (Id.) Plaintiff testified that the Board approved the proposed modification “because my Board didn't want to hurt me, with everything I was going through, as far as the indictment,” that is, “to make sure that I got my severance benefit.” (
Similarly, Local 223's Lifetime Medical Benefits Policy entitles members to a monthly Medicare Supplement Benefit “upon termination of office or employment or retainer . . . by reason of death, disability, or resignation.” (Defs. 56.1 Stmt. ¶¶ 18, 21.) The Lifetime Medical Benefits Policy is provided through the Local 223 Sick Benefit Fund, which is an ERISA-governed welfare benefit fund. (Id. ¶¶ 19-20.) While the policy originally provided for a lifetime preferred provider organization plan, in 2012 the Executive Board, including Plaintiff, amended the policy to provide a Medicare supplement benefit. (Id. ¶¶ 21-23.)
At an August 17, 2015 Local 223 Executive Board meeting, Plaintiff proposed modifying the Lifetime Medical Benefits Policy to include a length of service requirement. (Id. ¶¶ 24-25.) After amendment, the provision read: “All Union Officers with at least fifteen (15) years of service will receive lifetime medical coverage for themselves and their spouse to be paid by the Union upon their separation from employment.” (Id. ¶ 24 (emphasis added).) Notably, the change from termination “by reason of death, disability, or resignation” to “separation from employment” was not reflected in the Executive Board meeting minutes. (Id. ¶ 25.) As Plaintiff later testified regarding the amendment, “I was there for over 15 years and I wanted to make sure that my lifetime medical benefits were secured.” (Id. ¶ 26.)
International administers the NQDC Plan, an ERISA-governed plan that provides certain deferred compensation benefits to eligible International Officers and General Executive Board members. (Id. ¶¶ 29-30.) Under International's Constitution:
The International Union, from its General Funds, shall establish a Non-Qualified Deferred Compensation and Severance Plan providing such benefits as may be determined by the General Executive Board for the International Officers and General Executive Board members. To be eligible for benefits (under the NQDC Plan), the International Officer or General Executive Board member must have retired from any position of office with the International Union, any subordinate body, and any benefit fund of the subordinate body or related to the subordinate body.
(Id. ¶ 31 (emphasis added) .) The NQDC Plan is governed by the terms of the NQDC Plan Document, which provides in relevant part that “[t]he [Advisory] Committee shall have the sole right to reconcile, determine, interpret, and construe any question or dispute arising in connection with definitions of terms, rights, status or classification of Participants, or any other dispute arising under the [NQDC Plan],” and that “such reconciliation, determination, interpretation or construction shall be final and conclusive.” (Id. ¶ 32.) The NQDC Plan Document further provides that only the Advisory Committee has the authority to determine eligibility and the right to participate in the NQDC Plan, and that “[n]o person shall have any vested right to the benefits provided by the [NQDC] Plan.” (Id.) Benefits from the NQDC Plan are paid from the general assets of International. (Id. ¶ 33.)
C. Plaintiff's Guilty Plea and Termination
On August 8, 2016, Plaintiff pleaded guilty to one count of conspiracy to solicit and receive kickbacks to influence the operation of the Local 223 Sick Benefit Fund. (Id. ¶ 6.) On August 16, 2016, Plaintiff was terminated from his employment as Union Officer of Local 223 and Trustee of the Sick Benefit Fund. (Id. ¶ 7.) Plaintiff disputes this, arguing that he resigned from his position and pointing to his deposition testimony in support.
On that same day, International placed Local 223 into temporary trusteeship. (Defs. 56.1 Stmt. ¶ 35.) On September 28, 2016, International sent notice to all Local 223 members that Local 223 was to be placed into permanent trusteeship based on Plaintiff's conviction for crimes against the Local 223 Sick Benefit Fund. (Id. ¶ 36.) On February 24, 2017, International sent notice to all members that Local 223 would merge into Local 22. (Id. ¶ 38.) As a result of the merger, the trusteeship of Local 223 was terminated. (Id. ¶ 39.)
D. Plaintiff's ERISA Denials
On September 13, 2016, International denied Plaintiff's initial claim for benefits from the NQDC Plan on the grounds that Plaintiff's conviction made it unlawful for International to pay Plaintiff additional compensation from the International's general assets. (Id. ¶ 40.) Specifically, International relied on 29 U.S.C. § 504(d), which prohibits individuals who are convicted of certain criminal acts from participating in, and from receiving salary from, a labor organization. (Id.) Similarly, on September 19, 2016, Local 223, acting through the International-appointed Trustee, denied Plaintiff's initial claim for benefits under the Lifetime Medical Benefits Policy on the grounds that providing that benefit would violate 29 U.S.C. § 504(d). (Id. ¶ 41.) Plaintiff unsuccessfully appealed the unfavorable determinations. (Id. ¶¶ 42-44.)
Later on June 14, 2017, Plaintiff submitted a second appeal and request for payment under the Severance Policy. (Id. ¶ 45.) International denied Plaintiff's request based on his indictment and subsequent attempt to amend the Local 223 Constitution and Bylaws prior to his removal...
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