Gomo v. NetApp, Inc., 5:17-cv-02990

Background

Plaintiffs are former NetApp senior executives who participated in an Executive Medical Retirement Plan that promised “lifetime” medical benefits for retirees, spouses, and children under 26.
NetApp acted as both plan sponsor and plan administrator and provided PowerPoint slides (2009–2015) to participants as the asserted plan document; those slides contain no reservation of rights to terminate lifetime benefits.
In 2016 NetApp amended/eliminated the lifetime benefit, offering limited reimbursements and a lump-sum instead; plaintiffs requested any plan language permitting termination and were shown different documents they contend are for a separate retiree plan.
Plaintiffs sued under ERISA: (1) claim for benefits/clarification under § 502(a)(1)(B) seeking enforcement of lifetime benefits as written, and (2) breach of fiduciary duty under § 502(a)(3) seeking equitable remedies (estoppel, reformation) if benefits are not vested.
NetApp moved to dismiss under Rule 12(b)(6), arguing the operative plan documents contain an express reservation of rights permitting amendment/termination and that plaintiffs’ fiduciary/estoppel theory is duplicative or contradicted by the written plan.
The court denied the motion to dismiss both claims, holding that NetApp’s extrinsic plan documents could not be considered on a 12(b)(6) motion and that factual disputes about the governing plan documents and ERISA formalities precluded dismissal; plaintiffs may plead alternative ERISA remedies.

Issues

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether plaintiffs are entitled to enforce “lifetime” retiree medical benefits under ERISA § 502(a)(1)(B)	The PowerPoint slides provided are the plan document and promise vested lifetime benefits with no reservation of amendment rights	NetApp contends other insurance/group policy documents are the governing plan documents and those reserve rights to amend or terminate benefits	Denied dismissal — court cannot consider NetApp’s extrinsic documents at pleading stage; factual dispute unsuitable for 12(b)(6) resolution
Whether NetApp’s § 502(a)(3) fiduciary claim (estoppel/reformation) is duplicative of the § 502(a)(1)(B) claim	Plaintiffs may assert fiduciary breach and seek equitable relief alternatively if benefits are not enforceable under plan terms	NetApp says § 502(a)(3) claim is duplicative and fails because written plan controls	Denied dismissal — alternative equitable claims are permitted at pleading stage and reformation is not available under § 502(a)(1)(B)
Whether oral representations may be used to contradict written plan terms	Plaintiffs allege oral assurances and absence of reservation in the materials they received	NetApp argues oral promises cannot contradict unambiguous written plan documents	Denied dismissal — resolution depends on which documents govern; cannot decide on the pleadings
Whether court may consider NetApp’s submitted plan documents on a 12(b)(6) motion via incorporation by reference	Plaintiffs say the submitted documents are unauthenticated and refer to a different plan; complaint disclaims reliance on them	NetApp invokes incorporation by reference to have the documents considered	Denied — documents are disputed in authenticity/relevance and complaint alleges they are not the governing plan, so they cannot be considered at this stage

Key Cases Cited

Conservation Force v. Salazar, 646 F.3d 1240 (9th Cir. 2011) (standard for Rule 12(b)(6) review)
Navarro v. Block, 250 F.3d 729 (9th Cir. 2001) (12(b)(6) tests legal sufficiency of claims)
Reese v. BP Exploration (Alaska) Inc., 643 F.3d 681 (9th Cir. 2011) (accept well-pled factual allegations at pleading stage)
In re Gilead Scis. Sec. Litig., 536 F.3d 1049 (9th Cir. 2008) (court need not accept conclusory allegations)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (pleading must be plausible)
Bell Atlantic Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility pleading standard)
Pisciotta v. Teledyne Indus., Inc., 91 F.3d 1326 (9th Cir. 1996) (distinction between welfare and pension plans; welfare benefits generally nonvested)
Cinelli v. Security Pac. Corp., 61 F.3d 1437 (9th Cir. 1995) (vesting must be found in plan documents)
Swartz v. KPMG LLP, 476 F.3d 756 (9th Cir. 2007) (limits on considering extrinsic documents on a 12(b)(6) motion)
Coto Settlement v. Eisenberg, 593 F.3d 1031 (9th Cir. 2010) (incorporation-by-reference doctrine conditions)
Bush v. Liberty Life Assurance Co. of Boston, 77 F. Supp. 3d 900 (N.D. Cal. 2015) (permitting alternative § 502(a)(1)(B) and (a)(3) claims at pleading stage)