Robert Fallin v. Commonwealth Industries, Inc.
695 F.3d 512
6th Cir.2012Background
- Commonwealth converted its traditional defined-benefit plan to a cash-balance plan in 1998, linking benefits to hypothetical accounts.
- Early-retirement subsidies existed pre-1998; plaintiffs allege the conversion did not credit the pre-amendment subsidy fully.
- All nine plaintiffs retired and took lump-sum payments; Corley was 55 at payment, others waited longer.
- Eight plaintiffs asserted ERISA § 1132(a)(1)(B) claims within five years of administrative rejection but over five years after payments, alleging underpayment.
- The district court dismissed eight as time-barred and ruled Corley timely on accrual grounds, while denying merits on Corley’s claim.
- On review, the court affirmed dismissal of eight but vacated and remanded Corley’s claim for merits and harm analysis.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Timeliness under statute of limitations | Corley and others relied on tolling when pursuing remedies. | Redmon-style five-year limit accrues on repudiation, time-barred for eight plaintiffs. | Eight claims time-barred; Corley timely due to tolling during administrative review. |
| Accrual and repudiation under Redmon framework | Plan payments did not unequivocally repudiate all further benefits. | Lump-sum payments constituted repudiation of additional benefits. | Accrual determined by fiduciary repudiation; district court correct to treat payments as repudiation for accrual purposes. |
| Plan interpretation of early-retirement subsidy | Plan must include pre-amendment subsidy value in lump-sum. | Plan defines early-retirement as present value of normal retirement benefit; subsidy not required. | Benefits Committee interpretation not arbitrary or capricious; complies with applicable Treasury regulation. |
| Anti-cutback protection under § 1054(g) | Pre-amendment subsidy accrued and could not be reduced. | Pre-amendment conditions needed to be satisfied before amendment; timing matters for accrual. | Rybarczyk controls; subsidy accrued if service pre-dated amendment and age condition met post-amendment; remand for detailed calculation. |
Key Cases Cited
- Redmon v. Sud-Chemie Inc. Retirement Plan for Union Employees, 547 F.3d 531 (6th Cir. 2008) (ERISA accrual and tolling aligned with five-year limitations and amendments)
- Rybarczyk v. TRW, Inc., 235 F.3d 975 (6th Cir. 2000) (anti-cutback scope and accrual guidance for retirement subsidies)
- Hill v. Blue Cross and Blue Shield of Mich., 409 F.3d 710 (6th Cir. 2005) (tolled limitations during administrative exhaustion)
- Cattin v. General Motors Corp., 955 F.2d 416 (6th Cir. 1992) (anti-cutback rule interpretation guidance)
- Daft v. Advest, Inc., 658 F.3d 583 (6th Cir. 2011) (de novo review standard for § 1054(g) interpretations)