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Senick v. Pension Benefit Guaranty Corp.

United States District Court, District of Columbia

September 9, 2016

DAVID SENICK, Plaintiff,
v.
PENSION BENEFIT GUARANTY CORPORATION, et al., Defendants.

          MEMORANDUM OPINION

          AMY BERMAN JACKSON United States District Judge.

         Plaintiff, proceeding pro se, has brought suit against the Pension Benefit Guaranty Corporation (PBGC) to challenge the final decision of the Appeals Board with regard to his pension benefits. PBGC asserts that plaintiff is not entitled to the additional benefits he seeks and has moved to dismiss under Rule 12(b)(6) of the Federal Rules of Civil Procedure [Dkt. # 21]. Plaintiff has opposed the motion [Dkt. # 26]. Upon consideration of the parties' submissions and review of the Administrative Record (“AR”) [Dkt. # 22-2, 22-3], the Court will uphold the agency's decision and dismiss the case for the reasons explained more fully below.

         BACKGROUND

         The Complaint and Administrative Record establish the following events. Plaintiff was an hourly employee at a Philadelphia-based subsidiary of Bethlehem Steel Corporation - Bethlehem & New England Railroad Company - from November 8, 1973 to July 19, 1975, when he was laid off. Plaintiff returned to work for the company on June 17, 1978, and he worked there until November 22, 1995, when he was again laid off. On December 4, 1996, at age 42, plaintiff resigned from the Company with 22.17 years of service.

         Plaintiff was a participant in the Bethlehem Steel Corporation Pension Plan. On July 2, 1999, the Company's Benefits Service Center notified plaintiff that he was eligible for a deferred vested pension benefit under the Bethlehem Railroad Subsidiaries 1991 Hourly Pension Plan (“Plan”), and that he could begin receiving monthly payments on October 1, 2016, at age 62. From 1999 to 2003, plaintiff requested immediate payments under the Plan's Rule-of-65 retirement provisions set out at Section 2.7.[1] Plaintiff's requests were denied because the total of his age at the time he left the company, 42, and his years of service, 22.17, fell short of 65.

         I. PBGC Designation

         The Plan terminated effective December 18, 2002, without sufficient assets, and PBGC became statutory trustee of the Plan on April 29, 2003. AR 131-35. PBGC is a wholly owned U.S. government corporation within the Department of Labor that generally guarantees pension plan benefits. See 29 U.S.C. §§ 1302, 1322. When a covered plan terminates without sufficient assets, PBGC “typically becomes the statutory trustee of the plan, takes over the plan's assets and liabilities, and pays guaranteed benefits to plan participants and their surviving beneficiaries.” Def.'s Mem. of P. & A. at 2. PBGC's determinations are based on the Plan's terms, statutory limits, and PBGC regulations. Id.

         II. Plaintiff's Benefits

         In August 2010, PBGC informed plaintiff that he was entitled to deferred retirement benefits. He could receive a monthly pension payment of $229.29, “based on [the] benefit starting on 10/1/2019 [at his normal retirement age of 65] in the form of ‘Straight Life Annuity with No Survivor Benefits, '” or a monthly payment of $298.10 if he chose to retire at age 62 on the “Earliest Unreduced Retirement Date.” Compl. Attach., ECF p. 57.[2]

         In September 2010, plaintiff appealed PBGC's determination to the Appeals Board. He claimed that he was entitled to an additional $400 per month under the Plan's Rule-of-65 provision, as well as a monthly payment of $401 under the Plan's permanent disability benefit provision. In a decision issued on October 12, 2011, the Appeals Board rejected plaintiff's claim for additional benefits but informed plaintiff that he was entitled to a deferred monthly benefit higher than that calculated by PBGC. According to the Appeals Board, plaintiff was entitled to monthly payments of $435.71, if he chose to receive benefits at age 62 or age 65. Compl. Attach., ECF pp. 95-104 (“Oct. 12, 2011 Dec.”).[3] If plaintiff chose to begin receiving benefits at age 60, he was entitled to monthly payments of $435.71 up until age 62, and monthly payments of $354.95 thereafter. Id.

         The Appeals Board considered plaintiff's dispute with records showing the calculation of his continuous service starting from October 4, 1974, rather than from his November 8, 1973 hire date. The Board explains the discrepancy as follows:

As shown [in chart] above, you were on layoff for two years, 10 months and 28 days between July 19, 1975 and June 17, 1978. Please note that only the first two years of that layoff count as continuous service in calculating your pension. To simplify pension calculations, it was common practice for Plans to adjust a participant's original date of hire in situations involving breaks in service instead of accounting for two or more separate periods of continuous service. Bethlehem's Plan Administrator used an October 4, 1974 adjusted date of hire for you, which is 10 months and 28 days after your actual date of hire (November 8, 1973).

         Oct. 12, 2011 Dec. at 3. The Appeals Board found that plaintiff “terminated” his “employment by ‘Quit with Notice' on December 4, 1996, ” and that given his age of 42.17 years and his continuous service of 22.17 years, he qualified for “a 40/15 Deferred Vested Pension under the provision of the 1991 Railroad Hourly Plan.” Id. He therefore was entitled to the foregoing unreduced benefit beginning at age 62 or the reduced benefit beginning at age 60. Id. The Board noted that plaintiff had supplemented his appeal with a letter from an Authorized PBGC Representative and one from a Labor Relations Manager, and it concluded that “both letters confirm your entitlement to a Deferred Vested Pension.” Id. at 3 n.1.

         The Appeals Board also considered plaintiff's claim that he was entitled to a disability retirement benefit because he had been “permanently disabled for the last three years.” Oct. 12, 2011 Dec. at 6. See Pl.'s Opp. at 3 (stating that he became totally disabled on or about January 2, 2008). Under Section 2.5 of the Plan captioned “Permanent Incapacity Retirement, ” a participant with at least fifteen years of continuous service who became “permanently incapacitated” could retire ...


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