The opinion of the court was delivered by: Joel Schneider United States Magistrate Judge
MEMORANDUM OPINION AND ORDER
Presently before the Court are three (3) related discovery motions. This Memorandum Opinion and Order addresses "Plaintiff's Motion to Compel Discovery" directed to defendant. [Doc. No. 35]. The issue before the Court concerns the scope of discovery when a defendant asserts a "clearly repudiated" defense under ERISA. Defendant opposes plaintiff's motion and the Court held oral argument on November 7, 2011. For the reasons to be discussed, plaintiff's motion is GRANTED in part and DENIED in part. Background
By way of background, plaintiff filed his class action complaint on June 23, 2010. Plaintiff started working for Rohm and Haas in 1967 and from the outset participated in its pension plan. The Rohm and Haas Plexiglas division plaintiff worked for was subsequently acquired by Elf Atochem which changed its name to Atofina Chemicals. Plaintiff terminated his employment with Atofina on January 1, 2004. Plaintiff claims there was a shortfall in his lump sum pension distribution. The essence of plaintiff's claim is that the portion of his pension attributable to his Rohm and Haas service should have included a cost of living component that the annuity option received. Plaintiff maintains defendant violated various provisions of ERISA by failing to provide a value for the COLA in calculating his lump sum payment.
Defendant steadfastly maintains that plaintiff's action is barred by the statute of limitations. Plaintiff filed a motion to dismiss on September 17, 2010 arguing this point. The Honorable Jerome B. Simandle denied the motion without prejudice on June 20, 2011 as procedurally improper. Judge Simandle found that since defendant's statute of limitations defense was based on a document not "integral" to the complaint, he could not consider it and defendant would have to raise the defense in a motion for summary judgment. Judge Simandle's Memorandum Opinion did not weigh in on what discovery was appropriate for plaintiff to respond to defendant's motion. Memo Op. at 5 ("It is not clear to what extent discovery will be necessary to respond to this motion [to dismiss] if converted into a motion for summary judgment, and if discovery will be necessary, how long it will require."). Judge Simandle, however, envisioned a streamlined procedure to address the merits of defendant's defense. Id. 5-6. ("[G]iven the time the parties have already spent litigating the issue, if the motion is re-filed as a summary judgment motion, the Court will entertain requests to streamline the summary judgment procedures or relax the briefing requirements in order to fairly resolve this potentially dispositive issue in a way that minimizes the expense to the parties."). Accordingly, this Court limited the initial discovery phase in the case to the statute of limitations issue.
After the denial of its motion to dismiss, defendant answered plaintiff's complaint and filed its motion for summary judgment on July 22, 2011 raising its limitations defense. On July 27, 2011, the Court held the Fed. R. Civ. P. 16 Scheduling Conference. At the conference defendant argued no discovery was necessary to decide its motion for summary judgment. Plaintiff disagreed. Despite defendant's argument, it was apparent to the Court that there were some clearly relevant documents that defendant should produce. To be sure, however, defendant disagreed. Given the parameters of discovery under Fed. R. Civ. P. 26, the Court determined that it could not be reasonably questioned that some categories of documents, for example all communications to plaintiff regarding his pension, and all pension documents plaintiff signed, were discoverable and should be produced. As to plaintiff's other document requests, the Court asked the parties to "meet and confer" to try and reach an agreement on what additional discovery would occur. Given the Court's indication that discovery would not be completely barred as defendant requested, defendant withdrew its motion for summary judgment without prejudice. Defendant is anxious to re-file the motion as soon as possible but wants to avoid a summary denial if plaintiff argues the motion was filed before he had an opportunity to conduct relevant discovery.
Some additional background is necessary to put the present discovery dispute in context. As to the applicable law, the trigger or accrual date for the applicable six-year statute of limitations has been addressed in several Third Circuit cases. In Romero v. Allstate Corp., 404 F.3d 212 (3rd Cir. 2005), the Court held that in an ERISA non-fiduciary duty claim, the claim accrues when the "employee knew or should have known that the amendment has brought about a clear repudiation of certain rights that the employee believed he or she had under the plan." Id. at 223. In Miller v. Fortis Benefits Ins. Co., 475 F.3d 516 (3d Cir. 2007), the court addressed the clear repudiation rule and approvingly cited a Second Circuit case that cited Seventh, Eighth and Ninth Circuit precedent that held that an "ERISA claim accrues upon a clear repudiation by the plan that is known, or should be known, to the plaintiff--regardless of whether the plaintiff has filed a formal application for benefits." Id. at 521-22. (Citation and quotation omitted).
The additional fact background relevant to the parties' discovery dispute is as follows. When plaintiff retired he had a choice whether to receive a monthly annuity or a lump sum payment.
Plaintiff chose to receive a lump sum distribution which was paid in January 2004. On December 7, 2009, plaintiff alleged in an administrative claim that his lump sum payment did not include the value of a COLA. Defendant denied the claim on April 5, 2010 and June 18, 2010, and this complaint was filed soon thereafter.
Defendant's statute of limitations defense is based upon Atofina papers plaintiff received with the title "Atofina Early Retirement Incentive Program Statement of Estimated Benefits." On November 24, 2003, plaintiff signed Atofina's "Retirement Benefits Request" electing to receive a lump sum payment. The language defendant relies upon is contained in the Statement of Estimated Benefits and reads:
You will not be entitled to this cost-of-living adjustment if you elect (with your spouse's written consent) to receive your RandH accrued benefit in the form of a lump sum. (Emphasis in original).
Defendant argues this was a clear repudiation of plaintiff's right to a COLA and, therefore, the statute of limitations accrued on November 24, 2003. Since plaintiff's complaint was filed on June 23, 2010, defendant argues it is barred by the six-year statute of limitations.
Plaintiff disagrees that the cited language was a clear repudiation of his present claim. Plaintiff argues that on November 14, 2003 he and his wife signed a form titled "Consent to Payment of Retirement Benefit in the Form of a Single Payment" that contained inconsistent or ambiguous language. The form reads:
I, Philip A. Dix [handwritten](Participant), hereby consent, pursuant to Article IV of the ATOFINA Chemicals, Inc. Retirement Benefits Plan (the "Plan") to the Plan's distribution to me in a single payment of the actuarial equivalent present value of the benefit that I would otherwise be entitled to receive in the form of monthly annuity payments. I understand that by choosing my benefit in the form of a single payment, the Plan will be fully discharged of its obligations to me and to my spouse, and I (we) will have no right or entitlement to any future *fn1 benefits from the Plan. (Emphasis added).
Plaintiff argues defendant did not make a clear repudiation because the language in his consent form indicated that his lump sum payment would include the actuarial value of the COLAs he would have received had he elected to take an annuity.*fn2 Plaintiff argues the statute of limitations on plaintiff's claim did not accrue until defendant clearly repudiated his right to a COLA component in his lump sum payment. Plaintiff alleges this did not occur until his administrative claim was denied ...