United States District Court, District of Columbia
ROBERT L. WILKINS, United States Circuit Judge (Sitting by designation in the United States District Court for the District of Columbia).
Plaintiff Minerva DeLeon, a retiree of U.S. Air, Inc., brought this action to challenge defendant Pension Benefit Guaranty Corporation’s (“PBGC”) determination that she is entitled to only $79.67 in monthly retirement benefits after 20 years of service. Plaintiff sues PBGC in Count I of the Second Amended Complaint [Dkt. # 60] (“Am. Compl.”) for “Failure to Properly Calculate Monthly Retirement Benefits, ” and in Count II for “Breach of Fiduciary Duty.” Am. Compl. at 6, 8. The latter count was dismissed on May 8, 2013. See DeLeon v. U.S. Airways, Inc., No. 12-0503, slip op., 2013 WL 1903661 (D.D.C. May 8, 2013) (hereafter DeLeon I) (granting PBGC’s motion to dismiss fiduciary breach claim under Rule 12(b)(6)).
What remains in this case is PBGC’s motion for summary judgment on Count I of the amended complaint. Def. PBGC’s Mot. for Summ. J. [Dkt. # 77]. Plaintiff, through appointed counsel, has opposed the motion, Pl. Minerva DeLeon’s Opp’n to Def. PBGC’s Mot. for Summ. J. [Dkt. # 81], and PBGC has replied, Def. PBGC’s Reply Mem. in Support of Mot. for Summ. J. [Dkt. # 82]. Upon consideration of the parties’ submission and the Administrative Record (“AR”) [Dkt. ## 56, 83], the Court will grant Defendant’s motion and enter judgment accordingly.
How PBGC became trustee of U.S. Airways’ retirement plan on February 1, 2005, is recounted in DeLeon I and will not be repeated here. The undisputed facts relevant to the instant motion are as follows. From the beginning of her employment with U.S. Airways in July 1987, Plaintiff participated in the Retirement Plan for Certain Employees of U.S. Airways, Inc. (“the Plan”). DeLeon I at *1. Section 19.1 of the Plan states:
Notwithstanding any other provision of the Plan to the contrary, no further benefits shall accrue under the Plan after December 31, 1991 (the ‘freeze date’) with respect to any Participant in the Plan, other than a participant whose coverage under the Plan is provided pursuant to a collective bargaining agreement or a Piedmont Aviation Services Participant. Such a Participant’s Accrued Benefit under the Plan shall be determined based on his Final Average Earnings as of the freeze date (determined as if the Participant’s service ceased on the freeze date), his Credited Service as of the freeze date, the Adjustment Factors in effect under the Plan as of the freeze date, and the terms of the Plan as in effect on the freeze date.
PBGC’s Statement of Material Facts Not in Genuine Dispute (“PBGC’s Facts”) [Dkt. # 77-1] ¶ 4 (AR 063). In February 1994, Plaintiff was placed on medical leave because of a work-related back injury she suffered on July 7, 1993. Plaintiff was found disabled by the Social Security Administration as of November 1, 1995. Id. ¶ 8 (AR 293).
In March 2008, Plaintiff applied to PBGC for pension benefits under the Plan and began receiving an estimated monthly benefit of $71.21 on June 1, 2008. PBGC’s Facts ¶¶ 10-11 (AR 208, 231). Plaintiff’s payment was increased slightly to $79.67 in September 2009, when PBGC issued its formal determination letter accompanied by a Benefit Statement. Id. ¶¶ 12-13 (AR 259, 261-63). According to the Statement, Plaintiff’s benefit was calculated from her date of hire on July 13, 1987, to the date of the “Benefit Freeze” on December 31, 1991, and her “Final Average Monthly Earnings” were listed as $1, 455.74. AR 262. The Statement also noted that Plaintiff was actively employed on January 17, 2005, when the Plan was terminated under Title IV of the Employee Retirement Income Security Act of 1974 (“ERISA”).
On December 18, 2009, Plaintiff appealed PBGC's determination to the Appeals Board, claiming that PBGC failed to credit her with 20 years' service (as opposed to four years) and improperly calculated her average earnings based on $17, 468.92 (as opposed to $19, 270). AR 274. The Appeals Board upheld PBGC's determination on October 20, 2010. AR 001. The Appeals Board first addressed “the issue of whether you are entitled to additional credit service for periods you were working or on medical leave after the December 31, 1991 freeze date, ” and concluded that Section 19.1 of the Plan, as amended in 1994, “stopped the accrual of credit service as of December 31, 1991 [and] did not include any exceptions for individuals on medical leave or other leave status.” AR 003. The Appeals Board also affirmed that under the amended Plan, Plaintiff had earned 2.4 years of credited service between her hire date of July 13, 1987, and December 31, 1989, and .8 years of credited service in 1990 and 1991 for part-time work, which amounted to four years of credited service. Id. The Appeals Board next addressed Plaintiff’s average earnings argument and affirmed that Section 19.1 of the Plan froze that calculation as “based upon [a participant’s] Final Average Earnings” as of December 31, 1991, and that any earnings after that date were not included in the calculation. Id. The benefit amount was based on the highest average earnings “received in any three full calendar years during the last 10 calendar years before December 31, 1991, ” which, in Plaintiff’s case, were identified as 1989, 1990, and 1991. Plaintiff’s earnings totaled $52, 406.76; divided by three years, her highest average earnings for the requisite time period were calculated to be $17, 468.92. Id.
When, as here, PBGC is appointed statutory trustee, it is responsible for administering benefits under the terminated pension plan, which includes making determinations with respect to the plan participants' benefits. See 29 U.S.C. § 1342(d)(1)(B); Air Line Pilots Assoc. Int’l. v. PBGC, 193 F.Supp.2d 209, 211-12 (D.D.C. 2002) (discussing ERISA’s statutory framework). Participants may challenge such determinations before the PBGC Appeals Board, see 29 C.F.R. §§ 4003.21, 4003.51, and “[t]he decision of the Appeals Board constitutes the final agency action by the PBGC with respect to the determination which was the subject of the appeal, ” id. § 4003.59(b). Decisions of the Appeals Board are then subject to review under the Administrative Procedure Act (“APA”). See PBGC v. LTV Corp., 496 U.S. 633, 636 (1990); Davis v. PBGC, 864 F.Supp.2d 148, 155 (D.D.C. 2012); United Steel v. PBGC, 839 F.Supp.2d 232, 241 (D.D.C. 2012).
Under the APA, a court must set aside agency action as unlawful if it is “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.” 5 U.S.C. § 706(2). The “arbitrary and capricious” standard of review is a narrow one, and it is well settled that “a court is not to substitute its judgment for that of the agency.” Motor Vehicle Mfrs. Ass'n v. State Farm Mut. Auto. Ins. Co., 463 U.S. 29, 43 (1983). While a reviewing court must conduct a “searching and careful” review, the agency's action remains “entitled to a presumption of regularity.” Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 415 (1971). The Court must uphold PBGC's decision “so long as the agency ‘engaged in reasoned decision making and its decision is adequately explained and supported by the record.’ ” Clark County v. FAA, 522 F.3d 437, 441 (D.C. Cir. 2008) (quoting N.Y. Cross Harbor R.R. v. STB, 374 F.3d 1177, 1181 (D.C. Cir. 2004)); see accord Vanderkam v. PBGC, 943 F.Supp.2d 130, 137-38 (D.D.C. 2013). Because under the present circumstances “the district court sits more as an appellate tribunal than as a trial court, ” Leahy v. Raytheon Co., 315 F.3d 11, 18 (1st Cir. 2002), “[t]he Court's review of a benefits determination ‘may only be based on the record available to the administrator or fiduciary at the time the decision was made.’ ” Marcin v. Reliance Standard Life Ins. Co., Civ. 895 F.Supp.2d 105, 113 (D.D.C. 2012) (quoting Crummett v. Metro. Life Ins. Co., No. 06-01450, 2007 WL 2071704, at *3 (D.D.C. July 16, 2007)). Hence, a plaintiff seeking review of an ERISA-plan benefit decision may not “supplement the [court] record with new documents.” Lee v. Hartford Life & Acc. Ins. Co., 928 F.Supp.2d 51, 57 (D.D.C. 2013).
Plaintiff argues that a genuine issue exists with regard to the calculation of her benefits because PBGC failed to consider a provision of a 1994 Corporate Policy Manual that “sheds light on whether the alleged freeze was meant to cover employees with a Social Security Disability.” Pl.’s Mem. of P. & A. at 6; Ex. A (Jan. 1, 1994 Corp. Policy Manual § 8.1, stating “[e]mployees awarded Social Security Disability Benefits are eligible to continue to accrue ...