The opinion of the court was delivered by: Rosemary M. Collyer United States District Judge
Plaintiffs James C. Stephens and Richard Mahoney,*fn1 retired pilots for US Airways, sue the Pension Benefit Guaranty Corporation ("PBGC")*fn2 as successor-in-interest to the Retirement Income Plan for Pilots of U.S. Air, Inc. ("Plan"). They allege that US Airways violated the Plan by not paying lump sum benefits on their benefit commencement dates and that US Airways violated the "actuarial equivalent" provision of the Employee Retirement Income Security Act of 1974, ("ERISA"), 29 U.S.C. § 1054(c)(3), by not paying interest for the period between their benefit commencement dates and the dates the lump sum benefits were actually paid.*fn3 Pending before the Court are PBGC's motion for summary judgment and Plaintiffs' motion for partial summary judgment. See Dkt. ## 23 & 24. For the reasons explained herein, the Court will grant PBGC's motion and deny Plaintiffs' motion.
US Airways was the contributing sponsor and plan administrator of the Plan until March 31, 2003, when, pursuant to Title IV of ERISA*fn4 and an agreement between US Airways and PBCG, the Plan was terminated because its assets were inadequate to pay its liabilities. On that same date, PBGC became the statutory trustee of the Plan and is now paying its benefits, within the limits of Title IV. PBGC is also acting as the guarantor of Title IV benefits that the terminated Plan owes and will owe to Plan beneficiaries.
Two such participants are Plaintiffs James C. Stephens and Richard Mahoney. On their sixtieth birthdays, Messrs. Stephens and Mahoney retired as pilots for US Airways.*fn5 Mr. Stephens retired on November 25, 1996. Mr. Mahoney did so on March 2, 1999. Upon retirement, both elected to receive their accrued retired benefits under the Plan as a single lump sum payment, rather than as an annuity paid monthly. Mr. Stephens received a lump sum payment in the amount of $488,477.22 on January 14, 1997, 45 days after his December 1, 2006 benefit commencement date. Mr. Mahoney received a lump sum payment in the amount of $672,162.79 on May 14, 1999, 45 days after his April 1, 1999 benefit commencement date.
After learning that this 45-day delay was being applied to all lump sum payments under the Plan, Mr. Stephens initiated administrative proceedings to challenge the actions of US Airways and the Plan. These administrative proceedings continued for approximately two years, culminating in a decision by the US Airways Retirement Board*fn6 denying Mr. Stephens' administrative challenge.
Plaintiffs allege that US Airways violated the Plan by not paying lump sum benefits on their benefit commencement dates and that US Airways violated ERISA's "actuarial equivalent" rule, 29 U.S.C. § 1054(c)(3), by not paying interest for the 45-day period between their benefit commencement dates and the dates the lump sum benefits were paid.
Under Rule 56 of the Federal Rules of Civil Procedure, summary judgment must be granted when "the pleadings, depositions, answers to interrogatories, and admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Fed. R. Civ. P. 56 (c); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247 (1986); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986); Diamond v. Atwood, 43 F.3d 1538, 1540 (D.C. Cir. 1995). Moreover, summary judgment is properly granted against a party that "after adequate time for discovery and upon motion . . . fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322. To determine which facts are "material," a court must look to the substantive law on which each claim rests. Anderson, 477 U.S. at 248 (1986). A "genuine issue" is one whose resolution could establish an element of a claim or defense and, therefore, affect the outcome of the action. Celotex, 477 U.S. at 322; Anderson, 477 U.S. at 248.
In ruling on a motion for summary judgment, the court must draw all justifiable inferences in the nonmoving party's favor and accept the nonmoving party's evidence as true. Anderson, 477 U.S. at 255. A nonmoving party, however, must establish more than "the mere existence of a scintilla of evidence" in support of its position. Id. at 252. To prevail on a motion for summary judgment, the moving party must show that the nonmoving party "fail[ed] to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322. By pointing to the absence of evidence proffered by the nonmoving party, a moving party may succeed on summary judgment. Id. In addition, the nonmoving party may not rely solely on allegations or conclusory statements. Greene v. Dalton, 164 F.3d 671, 675 (D.C. Cir. 1999). Rather, the nonmoving party must present specific facts that would enable a reasonable jury to find in its favor. Greene, 164 F.3d at 675. If the evidence "is merely colorable, or is not significantly probative, summary judgment may be granted." Anderson, 477 U.S. at 249-50 (citations omitted).
A. Failure to Pay Lump Sum Benefits on Benefit Commencement Dates
Count I of the Third Amended Complaint alleges that the Plan required US Airways to pay lump sum benefits to Plaintiffs on their benefit commencement dates and that US Airways breached that requirement by paying Plaintiffs their lump sum benefits 45 days after their benefit commencement dates. 3d Am. Compl. ¶¶ 65-70. The Plan defines "Benefit Commencement Date" as "the date as of which payment of a Participant's retirement income is to commence, as determined in accordance with the further terms of the Plan." Pls.' Mot. for Partial Summ. J. [Dkt. # 24], Ex. A ("Plan Document") § 2.1(G). The "further terms of the Plan" provide that "[e]ach Participant who retires from the employ of the Employer on his Normal Retirement Date . . . will receive a normal retirement income commencing on the first day of the month coinciding with or next following his Normal Retirement Date." Id. § 4.3 (emphasis added). "Normal Retirement Date" is defined as "the date on which the Participant attains his 60th birthday." Id. § 2.1(V). The Plan provides that "[a] Participant's retirement income will be payable monthly, with each payment equal to 1/12th of the yearly amount" and that "[t]he first of such monthly payments will be made at the Participant's Benefit Commencement Date, with subsequent monthly payments being made at the first of each month thereafter until the Participant's death." Id. § 9.5. The Plan also provides for "optional forms of payment," including a "lump sum option." See id. §§ 10 & 10.4. However, the Plan is silent as to when lump sums must be paid.
Plaintiffs argue that the Plan required US Airways to pay their lump sums on their Benefit Commencement Dates. They construe "the date as of which payment of a Participant's retirement income is to commence" as the date on which lump sum payments must be made. Plaintiffs conflate the date benefits commence with the date payments must be made. The Internal Revenue Service distinguishes ...