Alcorn v. Appleton
308 Ga. App. 663
Ga. Ct. App.2011Background
- Alcorn executrix and sister appeal a superior court partial grant of summary judgment to Appleton regarding a waiver of ERISA plan benefits in a settlement incorporated into a 2007 order.
- Settlement on July 7, 2007 allowed each party to name beneficiaries and waived the other party’s rights to life insurance proceeds and to retirement benefits.
- The settlement was incorporated into a September 25, 2007 Order of Separate Maintenance; Richard Alcorn died April 11, 2008.
- At death, Alcorn had an ERISA 401(k) plan and a life insurance plan; no 401(k) beneficiary designation by Alcorn; Appleton was designated beneficiary of the life insurance policy.
- Proceeds from both plans were paid to Appleton; the Alcorns sued for breach of contract and other claims related to the benefits.
- Trial court held the waiver non-ERISA-compliant and precluded the claims; Georgia Court of Appeals reversed, holding ERISA does not preempt state-law claims for funds already distributed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ERISA preempts the Alcorns' contract claims | Alcorns contend Kennedy does not bar state-law recovery after distribution. | Appleton argues all such claims fall under ERISA, preempted after distribution. | ERISA does not preempt claims for funds already distributed. |
| Whether the settlement waiver was valid or ERISA-compliant | Waiver in the settlement should be enforceable notwithstanding Kennedy. | Waiver was not ERISA-compliant and thus ineffective to defeat claims. | Court does not uphold ERISA-based preclusion; reverses partial grant on preemption grounds. |
| Kennedy v. Plan Administrator relevance to state-law claims | Kennedy does not foreclose state-law actions seeking distributed funds. | Kennedy forecloses such state-law claims to recover distributed benefits. | Kennedy does not bar state-law claims for distributed ERISA funds. |
Key Cases Cited
- Kennedy v. Plan Admin., et al., 555 U.S. 285 (2009) (plan administrator's distribution upheld; noted possibility of state-law action post-distribution)
- Eickhoff v. Eickhoff, 263 Ga. 498 (1993) (ERISA does not preempt claims regarding funds already distributed)
- Clark v. Clark, 969 F. Supp. 1319 (S.D. Ga. 1997) (state-law claims can proceed regarding distributed ERISA funds)
- Boggs v. Boggs, 520 U.S. 833 (1997) (pre-distribution funds context; distinguishable from post-distribution holdings)
- Sweebe v. Sweebe, 712 N.W.2d 713 (Mich. 2006) (distinguishes Boggs; supports post-distribution recovery arguments)
- Pardee v. Pardee, 112 P.3d 308 (Okla. Ct. App. 2004) (ERISA does not preempt enforcement of divorce decree regarding allocated funds)
- Lasche v. Lasche Basic Profit Sharing Plan, 111 F.3d 863 (11th Cir. 1997) (pre-distribution funds context; distinguish Boggs)