Deschamps v. Bridgestone Americas, Inc. Salaried Employees Retirement Plan
840 F.3d 267
| 6th Cir. | 2016Background
- Deschamps worked for Firestone in Canada beginning August 8, 1983, then transferred to Bridgestone’s Wilson, NC plant in 1993 after being told his pension service date would remain August 8, 1983.
- Bridge-stone representatives (plant manager Ruccio and HR manager Russell) allegedly verified pension credit for his Canadian service; written benefit statements and online materials for years reflected the 1983 service date.
- Deschamps declined higher-salary offers from a competitor (Continental) in part because he relied on the alleged pension credit; Continental later froze its pension and did mass layoffs.
- Around 2010 Bridgestone changed Deschamps’s service date to August 1, 1993 (the U.S. hire date), eliminating credit for the Canadian years; Bridgestone denied internal appeals, saying Deschamps was not a “covered employee.”
- Deschamps sued under ERISA for equitable estoppel, breach of fiduciary duty, and anti-cutback (29 U.S.C. §§ 1132(a)(3), 1104, 1054(g)); the district court granted summary judgment for Deschamps on all three claims, and the Sixth Circuit affirmed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Equitable estoppel: whether Bridgestone’s representations and 10+ years of confirmatory materials estop it from denying 1983 service date | Deschamps: management representations plus repeated written confirmations caused justifiable, detrimental reliance; employer was aware (or grossly negligent) about the true facts | Bridgestone: no evidence it knew true facts or intended deception; employee didn’t deal with someone authorized to interpret the Plan; disclaimer and plan govern | Court: Plan ambiguous as to “supervisor”; employer’s long-standing misrepresentations and failure to correct for 16+ years constitute gross negligence/constructive fraud and justifiable, detrimental reliance → estoppel affirmed |
| Breach of fiduciary duty: whether Bridgestone acted as an ERISA fiduciary when making the misrepresentations | Deschamps: plant managers/HR acted in a fiduciary capacity when conveying plan terms/benefits and had apparent authority; he relied to his detriment | Bridgestone: communications were non‑fiduciary/ministerial or beyond the agents’ authority | Court: conveying information about plan terms/likely benefits is a fiduciary function; agents had apparent authority; breach of fiduciary duty affirmed |
| Anti-cutback (29 U.S.C. § 1054(g)): whether changing service date reduced an accrued benefit | Deschamps: under the Plan text (ambiguously) he could qualify as a covered employee pre-1993 (e.g., supervisor), so the change reduced accrued benefits | Bridgestone: no accrued benefit existed because administrator’s proper interpretation always excluded Deschamps as a covered employee; the change was correction of a clerical error | Court: determine accrued benefit by plan terms; plan text is ambiguous and plausibly supports Deschamps’ pre-1993 status → anti-cutback violation affirmed |
Key Cases Cited
- Bloemker v. Laborers' Local 265 Pension Fund, 605 F.3d 436 (6th Cir. 2010) (elements for equitable estoppel against pension plans)
- Varity Corp. v. Howe, 516 U.S. 489 (1996) (employer acts as fiduciary when misrepresenting plan benefits and affecting employees’ decisions)
- CIGNA Corp. v. Amara, 563 U.S. 421 (2011) (detrimental reliance standard; relief for loss of opportunity to improve position)
- Paul v. Detroit Edison Co. & Mich. Consol. Gas Co. Pension Plan, [citation="642 F. App'x 588"] (6th Cir. 2016) (employer gross negligence/constructive fraud where defendant was only party able to know true facts and repeatedly assured correctness)
- Smiljanich v. Gen. Motors Corp., [citation="302 F. App'x 443"] (6th Cir. 2008) (detriment established by loss of opportunity to accept alternate employment offering compensatory total compensation)
- Crosby v. Rohm & Haas Co., 480 F.3d 423 (6th Cir. 2007) (employer’s honest mistake and prompt corrective efforts do not rise to gross negligence)
- James v. Pirelli Armstrong Tire Corp., 305 F.3d 439 (6th Cir. 2002) (employer liable for fiduciary breach when HR/management misrepresent retirement benefits)