825 F. Supp. 2d 298
D.D.C.2011Background
- Jamal J. Kifafi sues Hilton Hotels Retirement Plan and related parties under ERISA for backloading violations.
- Court previously held plan used improper accrual formulas and ordered remedial recalculation using Court-approved formulas.
- Hilton proposed Amendment 2011-1 to implement remedies; Plaintiff objected to several provisions.
- Court reviewed objections, partially sustained, and ordered Hilton to adopt Amendment 2011-1 as revised by the Court.
- Key issues include treatment of fees, effective dates, participant classification, vesting, and accrual/offset formulas.
- Court-specific remedial directions addressed pre- and post-1981 service, offsets, and lump-sum vs. annuity payments.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Fee language in the introductory clause | Kifafi argues fees/incentives should not presume common fund payment. | Hilton contends clause merely contemplates potential future fee awards from common fund. | Clause permissible with revised language clarifying potential sources and impact. |
| Effective date and stay pending appeal | Amendment attempts to stay effect pending appeal contrary to rules. | Hilton argues need for effective date aligned with post-judgment proceedings. | Court rejects automatic stay mechanism; provisions must align with Rule 62 and prior order. |
| Definition of 'Affected Participants' | Should include survivors, beneficiaries, estates, not just current/former participants. | Plan terms designate beneficiaries; Court-approved by reference. | Definition upheld as consistent with plan documents and Court order. |
| Incorporation of vesting remedies | Amendment must explicitly reflect vesting-related remedies found in Order. | Added language references vesting remedies by reference; sufficient protection. | Addition deemed sufficient to address vesting issues and avoid misinterpretation. |
| Minimum accrual offsets and 'Integrated Benefits' | Offsets limit to union/NYHA, not entire 'Integrated Benefits' as defined. | Court-approved broader offset; plaintiff never objected to broader term. | Agreed: extend offsets beyond Court-approved scope; formulas revised to conform to Order. |
Key Cases Cited
- Langman v. Laub, 328 F.3d 68 (2d Cir. 2003) (anti-backloading considerations in ERISA plans)
- Amara v. CIGNA Corp., 131 S. Ct. 1866 (U.S. 2011) (court authority to reform plan terms under ERISA)
- In re Broadwing, Inc. ERISA Litig., 252 F.R.D. 369 (S.D. Ohio 2006) (fee awards from the common fund in ERISA suits)
- Bezio v. General Electric Co., 655 F. Supp. 2d 162 (N.D.N.Y. 2009) (ERISA attorney's fees eligibility and calculation)