Pharmacia Corp. Supplemental Pension Plan v. Weldon

• Citation: 126 F.Supp.3d 1061
• Decision Date: 24 August 2015
• Docket Number: Case No. 4:14CV1498 CDP.
• Parties: PHARMACIA CORPORATION SUPPLEMENTAL PENSION PLAN, by and Through its Plan Administrator, and PFIZER INC., Plaintiff, v. Virginia V. WELDON, M.D., Defendant.
• Court: U.S. District Court — Eastern District of Missouri

126 F.Supp.3d 1061

PHARMACIA CORPORATION SUPPLEMENTAL PENSION PLAN, by and Through its Plan Administrator, and PFIZER INC., Plaintiff,

v.Virginia V. WELDON, M.D., Defendant.

Case No. 4:14CV1498 CDP.

United States District Court, E.D. Missouri, Eastern Division.

Signed Aug. 24, 2015.

Ashely B. Abel, Jackson Lewis, P.C., Greenville, SC, Stephanie O. Zorn, Jackson Lewis, P.C., St. Louis, MO, for Plaintiff.

Douglas W. King, David A. Castleman, Shands and Elbert LLP, St. Louis, MO, for Defendant.

MEMORANDUM AND ORDER

CATHERINE D. PERRY, District Judge.

Plaintiffs Pharmacia Corporation Supplemental Pension Plan and Pfizer, Inc. allege that defendant Virginia V. Weldon should be required to reimburse them for more than $1.3 million in pension distributions that they mistakenly paid to her. When Weldon retired she elected to receive her pension benefits in set monthly payments over a period of three years. In 2006, after the plan benefits had been fully paid over the specified three years, the monthly payments continued to arrive. Weldon and her financial advisor brought the payments to the attention of a company the Plan had contracted with to address, among other things, customer questions about pension payments. A representative for that company assured them that the ongoing payments were correct and that Weldon was entitled to the money. The Plan ultimately stopped making the mistaken payments in 2009. The Plan and Pfizer brought this suit almost five years later, in 2014, asserting a variety of claims under ERISA and state law.

Weldon has filed a motion to dismiss and a motion for summary judgment, both of which seek to dismiss all of plaintiffs' claims. In her motion to dismiss, Weldon argues that plaintiffs' ERISA claims fail because they seek legal, not equitable, relief, and that the state-law claims are preempted by ERISA. In her summary judgment motion, Weldon asserts that plaintiffs failed to file their lawsuit within the applicable statutes of limitation and that the affirmative defense of laches should apply to bar their claims. I conclude that the Plan's ERISA claims for restitution and unjust enrichment (Counts 3 and 4) survive to the extent they seek to recover specifically identifiable funds (or the traceable proceeds of such funds) in Weldon's possession and control. I will dismiss all other claims brought by the Plan and all claims brought by Pfizer because they seek relief not allowed by ERISA or they assert state-law claims that are preempted by ERISA. I will deny the summary judgment motion because genuine disputes of material fact remain as to when the cause of action accrued, and whether plaintiffs' delay in bringing their claims was unreasonable.

I. Background

The Plan is an employee benefit plan that the parties agree is governed exclusively by the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. Pfizer is the current plan sponsor. Weldon is a retired medical doctor who joined Monsanto Company in 1989. As a Monsanto executive she participated in two pension plans. One was the Monsanto Company Supplemental Retirement Plan. The other plan, whose benefits are at issue in this lawsuit, was the Monsanto Company ERISA Parity Pension Plan (Parity Plan). Through a series of corporate changes, Weldon's Monsanto business unit ultimately became a part of Pfizer, Inc., and her two pension plans merged with each other and one or more other plans to become the Plan that is a plaintiff in this lawsuit.

In 2004, Pfizer entered into an "Outsourcing Services Agreement" with Fidelity Employer Services Company, LLC. Under this agreement, Fidelity was charged with providing "ministerial recordkeeping and administration services" for various Pfizer-sponsored retirement and health and welfare plans, including the Plan. The agreement states that Pfizer is the Plan sponsor and Pfizer, or a committee as provided for in each plan document, is the Plan administrator.

The Agreement¹ indicates Fidelity was to act as the "checkwriter" for pension payroll payments, was responsible for informing participants of overpayments and requesting repayment, and was responsible for supporting direct deposit of periodic and lump sum payments and answering questions regarding pension check disbursement. (Plf. Ex. A–2, Doc # 60–2, at 24, 26). Fidelity was to perform its services "within the framework of Plan provisions, guidelines and interpretations" as conveyed by Pfizer to Fidelity. (Plf. Ex. A–1, Doc. # 60–1, at 6). The agreement states Fidelity would have "no discretionary authority or power to make any decisions as to plan policy, interpretations, practices or procedures...." (Id. ). However, the "manner and means of performing the Services" were to be within Fidelity's exclusive control. The agreement states that the parties expressly deny, and that the agreement is not intended to create, a relationship of principal and agent between Pfizer and Fidelity. (Id. at 7).

According to the Agreement, Fidelity was to conduct audits to prevent duplicate payments/overpayments. (Id. at 26). It agreed to utilize "hrSource benefits specialists" as its "[b]randing" and would respond to customer telephone calls at the number 1–866–4SOURCE (4768723). (Id. at 96). All data transferred to Fidelity or generated by Fidelity in the course of performing services for Pfizer remained the property of Pfizer. (Plf. Ex. A–1, Doc # 60–1, at 14).

Weldon retired from Monsanto in 1999 and elected to defer payment of her pension benefits until 2003. Her benefit election form, which was executed in 1999, indicates that she opted to be paid for a term certain of three years following her deferral period. Her monthly benefits payments began as expected in January 2003. From 2003 to the end of 2005, Weldon received two monthly payments, one for each of the original two pension plans she participated in (despite those two plans supposedly merging in 2005). Although both payments were supposed to stop after December 2005, the payments on Weldon's Parity Plan continued through September 2009. After tax withholding, the net amount of each monthly payment for the Parity Plan was $20,141. Although the monthly payments were directly deposited into Weldon's account, each month she received a direct deposit written confirmation statement reflecting that month's payment.

After receiving the payments in January and February 2006, Weldon and her financial advisor, Diane Compardo, called the telephone number provided on the monthly direct deposit confirmations and spoke with a representative named Patty McGuire. McGuire was an employee of Fidelity, and the number Weldon reached her at was the same customer service telephone number provided in the outsourcing services agreement between Pfizer and Fidelity. The call was recorded by Fidelity, so there is no dispute about exactly what was said. McGuire asked Weldon to confirm which plan she was calling about by stating the amount of the most recent monthly payment. Weldon then asked how many more payments she could expect on that plan. McGuire put Weldon and Compardo on hold while she went to review the plan documents in order to answer Weldon's question. When McGuire returned to the phone, she stated "I just wanted to verify that it is the Key Executive Pension that we're talking about. The Non–Qualified Pension that you had with Pharmacia?" Weldon and Compardo responded affirmatively. McGuire then told Weldon she had taken out a Single Life Annuity and that payments would "go for the remainder of [her] life." In reliance on McGuire's representation that she would continue to receive monthly payments, Weldon made "even larger" contributions to charitable institutions in the following years. Since January 1, 2006, Weldon has contributed $2,228,576 to charitable institutions and institutions of higher education.

More than three years after the phone call between Weldon and McGuire, in September 2009, Fidelity was working on a reconciliation project between its historical records system and its disbursement system. During the course of this project Fidelity discovered that Weldon's benefit payments had mistakenly been paid to her since January 2006. Fidelity notified Pfizer employee Lisa Marie Misertino. Misertino instructed Fidelity to stop all future benefit payments to Weldon.

In the same month, and soon after Fidelity's discovery, Weldon received a letter from hrSource regarding the "Pharmacia Supplemental Pension Plan, ‘the Supplemental Plan,’ " notifying her that payments on this plan should have been stopped in December 2005. The letter stated she would be contacted soon about the amount and recovery of the overpayment. In late October 2009, Weldon received a letter from Cathy A. Wilkins of hrSource regarding "Pharmacia Supp. Pension Plan plus CB, ‘the Non–Qualified Plan.’ " This letter notified her that she had received an overpayment of $1,329,455.70 that needed to be returned to Pfizer. In December 2009 Weldon received another letter from Wilkins regarding "Pharmacia Supp. Pension Plan plus CB, ‘the Non–Qualified Plan’ " informing her that the letter would serve as her final notification that she must return the overpayment to Pfizer. Additional letters regarding the overpayments were exchanged between Fidelity representatives and Weldon's attorney in 2010 and 2011. There was no communication between the parties in 2012. In early 2013, additional letters were exchanged between Weldon's counsel and Pfizer's counsel. This lawsuit was filed in August 2014.

II. Legal Standards

A. Motion to Dismiss

The purpose of a motion to dismiss under Rule 12(b)(6) is to test the legal sufficiency of the complaint. When considering a 12(b)(6) motion, the court assumes the factual allegations of a complaint are true and construes them in favor of the plaintiff. Neitzke v. Williams, 490 U.S. 319, 326–27, 109 S.Ct. 1827, 104 L.Ed.2d 338 (1989).

Rule 8(a)(2), Fed.R.Civ.P., provides that a complaint must contain "a short and plain...