CA1: in an ERISA case, there was no cutback of benefits

Gillis v. SPX Corporation, No. 07-1777.  Most people spend the entire day at the office talking about ERISA cases around the water cooler. After all, talking about this stuff is how men bond.  In some offices, the people that can’t talk ERISA are fired simply because they don’t seem like team players.  This is an ERISA pension case that will keep people talking in bars for years to come.  It is so exciting that I put it under the fold.  If you don’t read about it, you might be considered a “little weird” by the other guys.

The first issue is whether the plan administrator improperly reduced the a plan participant's already accrued benefit by amending the plan in violation of ERISA § 204(g)(1); 29 U.S.C. § 1054(g)(1).  But the First says that the plaintiff is really seeking a two benefits (“Gillis would like to have his Transition Benefit calculated to include both the amount accrued under his previous GSX pension, which indisputably included his early retirement benefit, plus the early retirement subsidy granted by the Transition Benefit”).  Instead, the District Court noted that because the administrator had made an error and informed the participants of how it would cure it, there was no harm done.  Therefore, there were no age discrimination problems. 

As to the argument that future accrued benefits were improperly cut back, the First says that the plaintiff didn’t show that under ERISA § 204(h)(1) and 26 C.F.R. § 54.4980F-1, Q&A-6(b) there would be a reduction of benefits at his normal retirement age.  So, he couldn’t get past summary judgment.

The Pension Protection Act Blog comments here.  Stephen Rosenberg comments here.