Zeuner v. SunTrust Bank Inc., 181 F. Supp. 3d 214

Plaintiffs Michael Zeuner, Eamon Kelly, and Jean Brunei were terminated from GenSpring (a SunTrust subsidiary) on October 5, 2012 after a SunTrust reorganization; they applied for severance under the SunTrust Severance Pay Plan.
The Severance Plan provides benefits for a “Qualifying Termination,” defined to include involuntary separations for RIF, job elimination, consolidation, merger, reorganization, or “other business related changes,” but excludes terminations for poor performance and other listed reasons.
The Plan vests discretionary authority in the Plan Administrator to determine eligibility for benefits.
The Administrator denied Plaintiffs’ claims and subsequent appeals, concluding the terminations reflected an internal “change in leadership” (not a third‑party reorganization) and cited poor performance/leadership failings as the basis.
Plaintiffs sued under ERISA § 502(a)(1)(B) to recover benefits and under ERISA § 510 (29 U.S.C. § 1140) alleging SunTrust mischaracterized the terminations to interfere with benefits; they sought equitable relief and damages.
Defendants moved to dismiss under Fed. R. Civ. P. 12(b)(6); the court considered Plan documents and denial/appeal letters and granted dismissal without leave to amend.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether Administrator s denial of severance benefits violated ERISA § 502(a)(1)(B)	Plaintiffs: terminations were due to a change in leadership and thus fall within “other business related changes” in Qualifying Termination	Defendants: plan language (consolidation/merger/reorganization) and ejusdem generis support interpreting “other business related changes” as third‑party transactions; administrator s reasonable, discretionary interpretation	Dismissed: administrator s interpretation was reasonable; arbitrary-and-capricious review applies and plaintiffs failed to plead it was unsupported or tainted by conflict
Whether SunTrust violated ERISA § 510 by terminating to interfere with benefits	Plaintiffs: SunTrust mischaracterized terminations as poor performance to prevent severance	Defendants: plaintiffs do not allege termination motive was to interfere with benefits; allegation seeks benefits, not protection of employment relationship	Dismissed: § 510 protects employment relationship; plaintiffs allege interference with benefits post‑termination and fail to plead motivating intent to interfere
Whether leave to amend should be granted	Plaintiffs did not request leave; alleged discovery might show conflict or other facts	Defendants: dismissal is proper and substantive; pleading cannot cure defects	Denied: dismissal without leave appropriate because defects are substantive and plaintiffs did not seek repleading

Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (pleading must state a claim plausible on its face)
Ashcroft v. Iqbal, 556 U.S. 662 (2009) (courts may disregard legal conclusions and require factual allegations supporting plausibility)
Hobson v. Metro. Life Ins. Co., 574 F.3d 75 (2d Cir. 2009) (discretionary plan language triggers arbitrary-and-capricious review)
Durakovic v. Bldg. Serv. 32 BJ Pension Fund, 609 F.3d 133 (2d Cir. 2010) (standards for overturning administrator decisions and role of conflict of interest)
McCauley v. First Unum Life Ins. Co., 551 F.3d 126 (2d Cir. 2008) (if both administrator and claimant offer rational but conflicting interpretations, administrator's view controls)
Metro. Life Ins. Co. v. Glenn, 554 U.S. 105 (2008) (conflict of interest of a dual-role administrator is a factor in review)
Varity Corp. v. Howe, 516 U.S. 489 (1996) (section 502(a)(3) is equitable catch-all; relief under (a)(3) normally invoked only when (a)(1)(B) inadequate)