This week’s notable decision is Peck v. SELEX Sys. Integration, Inc., No. 17-7138, __F.3d__, 2018 WL 3431740 (D.C. Cir. July 17, 2018). Plaintiff Ronald Peck was a participant in Defendant SELEX Systems Integration’s “top-hat” ERISA-governed deferred compensation plan.  After working for SELEX for over fifteen years, the company terminated him when he refused to accept a transfer from his marketing position in D.C. to a different position in quality-control in Kansas.  Defendants denied Plaintiff’s claims for benefits under SELEX’s deferred-compensation plan and its severance policy on the basis that Plaintiff’s termination for refusing to transfer positions rendered him ineligible for benefits.  The district court granted judgment in SELEX’s favor on both claims for benefits.  The D.C. Circuit vacated the district court’s judgment with regard to the deferred compensation claim but affirmed the judgment with regard to severance pay. Continue Reading D.C. Circuit Holds That Participant Is Entitled to Deferred Compensation Benefits Despite Termination for Refusing to Transfer Positions

This week’s notable decision, Hurtado et al. v. Rainbow Disposal Co., No. 8:17-CV-01605-JLS-DFM, 2018 WL 3372752 (C.D. Cal. July 9, 2018), is a victory for ESOP plan participants, one that you don’t see too often these days.

This putative ERISA class action concerns a 2014 transaction in which waste management giant Republic Services bought Rainbow for $112 million in cash plus other consideration, according to documents filed with the SEC.  Yet according to separate documents filed with the DOL and IRS, the ESOP (which had owned 100% of Rainbow before the sale) received either $50.8 million or $48.8 million for its Rainbow stock. Of the $50.8 million or $48.8 million initially received, the ESOP did not initially distribute approximately $15 million which was held for nearly three years invested in treasuries yielding virtually no investment returns. Continue Reading Plaintiffs Fully Defeat Five Motions To Dismiss ESOP Class Action

Good morning, ERISA Watchers!  Today’s newsletter is ERISA Watch-lite since I just returned from Hawaii this weekend and am slowly readjusting to life on the mainland.  Below are a small handful of the appellate decisions that came out over the past couple of weeks.  A case I want to highlight is one you may have already read by now, but since it’s SO good, it is this week’s notable decision – Nichols v. Reliance Standard Life Ins. Co., No. 3:17-CV-42-CWR-FKB, 2018 WL 3213618 (S.D. Miss. June 29, 2018).

In Nichols, Judge Carlton Reeves found that Reliance Standard Insurance Company abused its discretion in denying Nichols’ claim for long-term disability benefits.  Though it’s a tale as old as time, what makes this decision stand out is the Court’s analysis of Reliance Standard’s “decades-long pattern of arbitrary claim denials and other misdeeds.”  Continue Reading Court Examines Two Decades of Reliance Standard Life Insurance Company’s Abuse of Discretion in Disability Benefit Claims