Dep. 20:9-11. Garcia asked Mushalla one last time, in September 1997,
whether the benefits were going to increase. The answer was still the
same. He did not ask again and he had no further conversations with
Mushalla, or anyone else at the Union or the Fund, after September.
Garcia Dep. 25:3-26:3. Garcia's retirement became effective on December
E. Charles Fritz
Fritz never made inquiry of anyone regarding possible changes in the
Pension Fund or the benefits for which he was to become eligible. Fritz
did testify that he was informed by his brother-in-law, Fritzinger,
another plaintiff, during a card game, that there would be no increase in
benefits. Fritzinger told Fritz that he knew this as a result of speaking
to Mushalla. Fritz Dep. 24:7-10. Fritz learned this sometime between the
middle of November and the middle of December. Fritz Dep. 8:21-9:9.
Fritz completed his paperwork for retirement on September 2, 1997 and
he retired effective January 30, 1998.
F. Francisco Corral
Corral never had any discussions with anyone at the Union or at the
Fund regarding his pension benefits. Corral Dep. 15:11-15. Corral
submitted his resignation paperwork on or about November 6, 1997. and
retired December 26, 1997. Corral Dep. 8:7-12.
G. Walter Boris, Jr.
Boris never inquired of anyone at the Fund or the Union regarding
possible changes to his pension benefits. Boris Dep. 40:19-41:1. Boris did
speak with Mushalla, his shop steward, and he checked the postings on the
bulletin board at work to gauge whether any increase in benefits would be
forthcoming. He determined that no increase was anticipated. Boris
completed his paperwork for retirement on October 1, 1997, and for his
pension on October 8, 1997. Boris Dep. 31:21-32:6; 44:14-22. Boris retired
December 19, 1997.
1. Standard for Summary Judgment
The standard for granting summary judgment pursuant to Rule 56 of the
Federal Rules of Civil Procedure has been stated frequently by the
Court. See Clawans v. U.S., 2000 WL 1887786, at *2-*3 (D.N.J. December
26, 2000); Soto v. City of Newark, 72 F. Supp.2d 489, 491-92 (D.N.J.
1999); Oakley v. Wianecki, 1998 WL 329266, at *5-*6 (D.N.J. June 18,
1998). Therefore, the Court will only restate it briefly here.
Summary judgment is appropriate only if all the probative materials of
the record "show that there is no genuine issue as to any material fact
and that the moving party is entitled to a judgment as a matter of law."
Fed.R.Civ.P. 56(c); see also Hersh v. Allen Prods. Co., Inc., 789 F.2d 230,
232 (3d Cir. 1986); Lang v. New York Life Ins. Co., 721 F.2d 118, 119 (3d
Cir. 1983). The Court must resolve all reasonable doubts in favor of the
nonmoving party when determining whether any genuine issues of material
fact exist. Meyer v. Riegel Prods. Corp., 720 F.2d 303, 307 n. 2 (3d
However, "the mere existence of some alleged factual dispute between
the parties will not defeat an otherwise properly supported motion for
summary judgment." Anderson v. Liberty Lobby, Inc., 477 U.S. 242,
247-48, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986) (emphasis in original). If
the moving party has made a properly supported motion for summary
judgment, then the nonmoving party must come
forward with specific facts to show that there is a genuine issue of
material fact for trial. Id. at 248, 106 S.Ct. 2505. "[T]here is no issue
for trial unless there is sufficient evidence favoring the nonmoving
party for a jury to return a verdict for that party. If the evidence is
merely colorable or is not significantly probative summary judgment may
be granted." Id. at 249 50, 106 S.Ct. 2505 (citations omitted). As such,
summary judgment "may present the district court with an opportunity to
dispose of meritless cases and avoid wasteful trials." Siegel Transfer,
Inc. v. Carrier Express, Inc., 54 F.3d 1125, 1130 (3d Cir. 1995)
2. The Legal Background
This case involves complex issues regarding the organization of ERISA
funds and the functions performed by and duties of the different players
involved in the creation, administration and termination of those funds.
To aid the reader in comprehending the Court's analysis, the Court will
begin by sketching for the reader two relevant dichotomies established in
the jurisprudence of ERISA and implicated in this case.
First, as noted above, defendant Pension Fund is a jointly managed,
multiemployer pension fund. A multiemployer plan is one to which two or
more unrelated employers contribute and which is maintained under one or
more collective bargaining agreements. A common trust is used to hold
contributions and pay benefits. Joseph R. Simone, Understanding ERISA
1996: An Introduction to Basic Employee Retirement Benefits 15
(Practising Law Institute, 1996). Multiemployer plans are also known as
Taft-Hartley plans if they are collectively bargained, as this plan is.
In the case of a Taft-Hartley plan, there is a joint board of trustees
made up of representatives from the various employers as well as "outside
trustees," who are not from any of the participating employers. Id. at
19; see also Washington Star Co. v. International Typographical Union
Negotiated Pension Plan, 729 F.2d 1502, 1504 (D.C.Cir. 1984).
In contrast to the multiemployer plan, the single-employer plan is
broadly defined as "any defined-benefit plan(as defined in section
1002 (35) of this title) which is not a multiemployer plan."
29 U.S.C. § 1301 (a)(15)(1994); see also Hawkeye Nat'l Life Ins. Co.
v. AVIS Indus. Corp., 122 F.3d 490, 499 (8th Cir. 1997) (defining both
multiemployer and single-employer plans). Single-employer plans are more
common in large corporations that have a sufficient number of employees
to justify such undertakings and the capital to fund them. Generally,
with single-employer plans, the corporation's board of directors appoints
an administrative committee to administer the plan and may sometimes
appoint a separate committee to oversee the investment of plan assets.
A second relevant dichotomy recognized in the caselaw is that between
fiduciary acts and ministerial acts. In the context of ERISA, "Congress
has conferred fiduciary status on persons and entities by activity and
not by label." Ronald J. Cooke, ERISA Practice and Procedure § 6.2
(2d Ed. 2000). As such, it is "clear that one is a fiduciary only to the
extent that he or she exercises one or more of the functions [set forth
in the statute], which means that the same person may be a plan fiduciary
for certain purposes, but not for others." Id.
According to § 3 (21)(A) of ERISA, a person is a fiduciary with
respect to a plan:
"to the extent (i) he exercises any discretionary
authority or discretionary control respecting
management of such plan or exercises any authority or
control respecting management or disposition
of its assets, (ii) he renders investment advice for a
fee or other compensation, direct or indirect, with
respect to any moneys or other property of such plan,
or has any authority or responsibility to do so, or
(iii) he has any discretionary authority or
discretionary responsibility in the administration of
29 U.S.C.A. § 1002 (21)(A).
In considering allegations of breach of fiduciary duty, "[t]he critical
distinction that may be drawn from [the caselaw] is . . . between
decisions under a plan and "business decisions.'" Cooke, ERISA Practice
and Procedure § 6.2. Amendment of a plan has routinely been held to
be a business decision, rather than a fiduciary act of administration.
Curtiss-Wright Corp. v. Schoonejongen, 514 U.S. 73, 115 S.Ct. 1223, 131
L.Ed.2d 94 (1995); Lockheed Corp. v. Spink, 517 U.S. 882, 116 S.Ct.
1783, 135 L.Ed.2d 153 (1996); Sutter v. BASF Corp., 964 F.2d 556 (6th
Cir. 1992). Therefore, while a plan trustee is a named fiduciary
according to ERISA, see 29 U.S.C.A. § 1103(a), "the plan trustee is a
fiduciary only with respect to those functions that fall within the scope
of ERISA § 3 (21)(A)." James F. Jorden et al., Handbook on ERISA
Litigation § 3.02[C] (2d ed. 1999). Amending, altering or terminating
a plan, therefore, does not trigger fiduciary duties regardless of who
undertakes those actions.
3. Threshold Analysis
The parties disagree about the proper legal framework for deciding this
case. Defendant contends that it is found in the Third Circuit opinion of
Fischer v. Philadelphia Elec. Co., 96 F.3d 1533 (3d Cir. 1996), cert.
denied, 520 U.S. 1116, 117 S.Ct. 1247, 137 L.Ed.2d 329 (1997) ("Fischer
II"). Fischer II defines when and how a fiduciary duty may attach in
connection with communication between an employer or plan sponsor and a
beneficiary regarding possible changes in the plan's benefits. In brief,
Fischer II holds that there is no duty of disclosure until a proposed
amendment is under "serious consideration," and, even then, disclosure is
only required in response to an inquiry by a beneficiary. The Court will
discuss the "serious consideration" test in greater detail below.
Plaintiffs, for their part, endeavor to distinguish this case from
Fischer II on a number of grounds, in order, presumably, to avoid the
undesirable outcome compelled by Fischer II should the Court apply it
here. The Court has found no cases in this Circuit (or any other for that
matter) applying the Fischer II analysis in a suit against a
multiemployer Fund rather than an employer. Therefore, the Court has
expended considerable thought and devoted great care to its determination
of the appropriate framework for analyzing this case. The Court has
considered each of plaintiffs' arguments against applying Fischer II
here, as well as some of its own. A discussion of those issues follows.
A. Fiduciary Duty of Disclosure
First, plaintiffs ask the Court to look to a line of cases that
addresses the duty of disclosure regarding existing plan benefits and to
find the fiduciary duty established therein binding on this defendant.
Specifically, plaintiffs argue that Bixler v. Central Penn. Teamsters
Health & Welfare Fund, 12 F.3d 1292 (3d Cir. 1993), should be "the
focal point for the Court's consideration." Pltfs.' Brief, at 4. In
Bixler, the Third Circuit considered the extent to which an employer's
alleged misinformation or failure to provide relevant information
constitutes an actionable breach of fiduciary duty under 29 U.S.C.A.
§ 1104(a). Id. at 1300. While at first blush, Bixler may appear to
control here, a
close reading of the case reveals that Bixler deals with disclosure
regarding existing plan benefits, which is considered a fiduciary act of
plan administration. Id.
Bixler and its progeny, on which plaintiff likewise relies, are not
relevant here for two reasons. First, the causes of action in those cases
arose out of communications regarding existing plan benefits. See, e.g.,
Jordan v. Federal Express Corp., 116 F.3d 1005 (3d Cir. 1997) (finding
issues of fact sufficient to survive summary judgment on question of
whether administrator violated its duty to disclose by providing
beneficiary with an incomplete explanation of the terms and conditions of
his retirement benefit election under the plan's current terms); Joyce
v. RJR Nabisco Holdings Corp., 126 F.3d 166 (3d Cir. 1997) (recognizing
existence, under certain circumstances, of a duty on the part of ERISA
fiduciaries to inform beneficiaries about benefits for which they are
eligible regardless of whether beneficiary requests such information).
Plaintiffs allege here that defendant's communications regarding
proposed benefits were misleading. To rely on cases where the
communications at issue went to existing benefits, therefore, is
inapposite. There is an obvious difference in the duty owed by an
employer or an ERISA fiduciary to its beneficiaries in communications
regarding existing versus proposed plan benefits. Indeed, plaintiffs
conceded as much at oral argument. See Tscpt. 16:18-17:16; 20:4-12.
The following colloquys between plaintiffs' counsel and the Court
demonstrate the shaky ground on which plaintiffs stand in asserting that
Bixler et al. control here:
Mr. Klausner: Not, your Honor, may I respectfully
suggest that the trustees, the minute they walk in the
door, in the multi-employer context, lose their
loyalty first to their employer. The minute they walk
into the board room as a trustee of a multi-employer
plan, their first and primary loyalty is to the
beneficiaries of the plan and the trust, not the
employer that's paying them to sit in the room.
The Court: Can I add something to that?
Mr. Klausner: Absolutely.
The Court: As to existing benefits. Right? As to
Mr. Klausner: That's what Walling stands for.