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Anthony v. International Association of Machinists

United States District Court, District of Columbia

March 29, 2019

GARY ANTHONY, Plaintiff,



         Plaintiff Gary Anthony brought this action against defendants District Lodge 1, a union affiliated with the International Association of Machinists and Aerospace Workers, and the International Association of Machinists and Aerospace Workers National Pension Fund (the “Fund”). Compl. [Dkt. # 1] at 1-2. He alleges that defendants violated the terms of the Plan and breached their fiduciary duties under the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 et seq., when they failed to include him as a participant under the Plan and denied him benefits. Id. Specifically, in Count I, plaintiff alleges that defendants violated the terms of the Plan by denying him eligibility to participate in the Fund as directed by the “documents and instruments governing the Plan.” Compl. ¶¶ 13-16. In Count II, he alleges that defendants owed him a fiduciary duty under ERISA to “observe and follow the governing terms” of the Plan, and that they breached that duty. Id. ¶¶ 17-21.

         On August 24, 2017, District Lodge 1 moved to dismiss both counts pursuant to Federal Rule of Civil Procedure 12(b)(6). It argued that plaintiff failed to allege sufficient facts to establish that District Lodge 1 is a fiduciary under ERISA. See Def.'s Mot. to Dismiss & Supporting Mem. of Law [Dkt. # 11] at 3-5. On November 6, 2017, the Court granted District Lodge 1's motion to dismiss Count II, because fiduciary status was a requirement for that count, but denied the motion to dismiss Count 1, because fiduciary status was not a requirement for that count. Anthony v. Int'l Ass. Of Machinists & Aerospace Workers District Lodge 1, 296 F.Supp.3d 92, 96-98 (D.D.C. 2017). Thus, plaintiff's ERISA claim for violation of the Plan proceeded against District Lodge 1.

         On August 15, 2018, District Lodge 1 moved for summary judgment on Count I, arguing that the Trustees of the Fund had sole discretion to make eligibility determinations, and therefore District Lodge 1 could not have violated the Plan when plaintiff was found to be ineligible to participate. See District Lodge 1's Mot. for Summ. J. [Dkt. # 28] (“District Lodge 1's Mot.”); District Lodge 1's Mem. of P. & A. in Supp. of its Mot. [Dkt. # 28-1] (“District Lodge 1's Mem.”). That same day, the Fund moved for summary judgment on Counts I and II, arguing that the Trustees' decision to deny eligibility to plaintiff was reasonable and therefore entitled to deference, and that plaintiff could not pursue Count II because the remedies requested were duplicative of Count I. See Fund's Mot. for Summ. J. [Dkt. # 27] (“Fund's Mot.”). Plaintiff filed a cross-motion for summary judgment on September 28, 2018 arguing that the Fund's decision was not based on substantial evidence and was therefore unreasonable. Pl.'s Mem. in Supp. of Pl.'s Mot. for Summ. J. [Dkt. # 29] (“Pl.'s Mem.”) at 6-9.

         Based upon the parties' briefs, the evidentiary record, and the relevant law, the Court will grant the Fund's motion for summary judgment, because the Fund's decision to deny eligibility to plaintiff was reasonable, and plaintiff cannot pursue duplicative remedies under § 1132(a)(3). The Court will also grant District Lodge 1's motion for summary judgment because the determination to deny eligibility was solely within the Trust's discretion.


         I. The Parties and Relevant Contracts

         Defendant District Lodge 1 is a union affiliated with the International Association of Machinists and Aerospace Workers (“IAM”). Pl.'s Statement of Facts in Supp. of Pl.'s Mot. [Dkt. # 29] (“Pl.'s SOF”) ¶ 2; Fund's Statement of Facts in Supp. of Fund's Mot. [Dkt. # 27-1] (“Fund's SOF”) ¶ 11. Plaintiff was employed as an “Organizer” by District Lodge 1 from May 2004 until January 2012, when he became a “Grand Lodge Representative, ” a position he continues to hold. Pl.'s SOF ¶ 1; Fund's SOF ¶ 21. Defendant IAM National Pension Fund (the “Fund”) is a multi-employer defined benefit pension plan, and District Lodge 1 is a “Contributing Employer” to the Fund. Pl.'s SOF ¶ 2; Fund's SOF ¶ 11.

         The Fund is established and maintained pursuant to its Amended and Restated Trust Agreement (“Trust Agreement”). AR550-88[1]; see also Fund's SOF ¶ 1. The Trust Agreement allows the Trustees to “allocate fiduciary responsibilities among the Trustees, or to committees of the Trustees.” AR560. Pursuant to this provision, the Trustees established an Appeals Committee which has been allocated the responsibility to “[r]eview and make decisions on all participant appeals submitted to the Fund, ” among other things. AR731-32.

         The Fund is governed by a document referred to as the Plan, which details the terms and conditions of the Fund. See AR409. An individual's right to a benefit payable by the Fund depends on whether the individual is a Participant, defined in the Plan as a “Covered Employee who meets the requirements for participation in this Plan . . . .” AR602. The Plan defines “Covered Employee” as “a person employed in Covered Employment.” AR597. “Covered Employment, ” in relevant part, is defined as “employment in a job classification for which employer contributions are required to this Plan by a written agreement between the Trustees and a Contributing Lodge.” Id.

         The Plan also establishes the scope of the Trustees' authority:

Trustees have the sole and absolute authority, in [their] discretion, to interpret this Plan and to determine eligibility for benefits under this Plan. As part of their discretionary powers, the Trustees shall be the sole judge of: (a) the standard of proof required in any case; (b) the application and interpretation of this Plan; (c) the amount of or entitlement to a pension; and (d) the crediting of Future or Past Service.

AR707. The decisions of the Trustees “with respect to any exercise of this discretion made in good faith shall be final and binding on the parties.” Id.

         District Lodge 1 and the Trustees of the IAM National Pension Fund executed a series of written Participation Agreements, which governed the union's participation in the Plan. Fund's SOF ¶ 11; Pl.'s SOF ¶ 3. During the time plaintiff was employed as an Organizer, from 2004 to 2012, there were a number of Participation Agreements executed.[2] See AR41-43; AR47-49; AR56-58; AR80-82; AR215-20. All of these agreements required District Lodge 1 to “provide coverage under the National Pension Plan for all of its employees, except those employees in a bargaining unit which has negotiated a Collective Bargaining Agreement.” See AR41; AR47; AR56; AR80; AR215.

         II. Plaintiff's Claim

         On or about April 5, 2016, plaintiff contacted the Fund because no contributions were being submitted on his behalf by District Lodge 1 to the Fund, and he believed that contributions should have been made. AR10. After looking into the matter, the Fund notified plaintiff on September 13, 2016 that he was not a participant in the IAM National Pension Fund or National Pension Plan. AR174. On October 21, 2016, plaintiff requested an appeal of that determination. AR175. He was told by the Fund's Executive Director, Rick Tierney, that his appeal would be heard at the Appeals Committee meeting on December 15, 2016. AR180; AR202-06.

         That December, the Appeals Committee decided that it needed additional information before it could render a decision. See AR239 (adopting a motion to defer plaintiff's appeal pending additional research). On December 20, 2016, the Fund notified plaintiff of its decision to defer determination pending additional research, and informed plaintiff that it has “referred this matter to District Lodge 1.” AR240. The purpose of the referral was to ascertain District Lodge 1's understanding of what job classifications it intended to cover as a Contributing Employer to the Fund under the Participation Agreement. Id.

         To that end, the Committee reached out to Anthony Armideo, the Directing Business Representative of District Lodge 1. AR242-43. It posed four questions:

1. What job classifications did District Lodge 1 intend to contribute on behalf of as a Contributing Employer during its time as a Contributing Employer to the Fund, in accordance with the attached Participation Agreement?
2. What job classifications of employees at District Lodge 1 were non-collectively bargained employees of District Lodge 1 during its time as a Contributing Employer to the Fund?
3. Were any job classifications at District Lodge 1 not employees of District Lodge 1 during its time as a Contributing Employer to the Fund? For example, were any persons or job classifications brought out to District Lodge 1 on lost time? Or were certain job classifications employees of another organization, but District 1 served a pass through for the purpose of pay?
4. Please provide any documents that assist in answering these questions, including but not limited to meeting minutes, notes, letters or email correspondence, Lodge 1 records including payroll records, and the like.

AR 242.

         Armideo responded on January 6, 2017, stating that District Lodge 1 never did, and did not then, intend to contribute to the Fund on behalf of the District Lodge 1 Organizer position. AR258-64. In coming to this conclusion, he examined the history of the Organizer position, prior and current Participation Agreements, past meeting minute records, and payroll audit records of District Lodge 1. Id. All of these records were attached to his response and submitted to the Appeals Committee for consideration. Id. at 265-312.

         On January 26, 2017, the Committee met again to consider plaintiff's appeal, and based upon the information presented and the supporting documentation attached to Armideo's letter, the Committee voted to deny plaintiff's appeal. AR316. Plaintiff was notified of the decision on January 31, 2017. Specifically, Tierney wrote:

In support of its position, District Lodge 1 provided District Lodge meeting minutes and various motions dating back to 1978. Those documents evidence that the positions for which District Lodge 1 intended to contribute extended only to Business Representatives (alternatively described as Business Agents) and the Secretary. Those documents also reflect that the Organizer position was never included among the class of employees for which contributions were intended to be made - whether during, or after your tenure as the District Organizer. District Lodge 1 also provided associated participation agreements. To the extent that the participation agreements include language suggesting that contributions were to be made for all employees other than those in a bargaining unit which has negotiated other pension benefits, there are factors that militate against a strict reading of that provision.
First, the [P]articipation Agreement is a boilerplate agreement that was not drafted by District Lodge l. It is a form agreement that is provided to contributing employers such as District Lodge 1. Since District Lodge 1 did not draft any of the participation agreements, it follows that the agreements should not be construed against it. Moreover, the documents illustrate that District Lodge 1 signed separate Participation Agreements for the Business Representative position and the Secretary position. Had District Lodge 1 intended for the “all employees” language to apply to it, it would not have utilized separate participation agreements for the business representative and the office secretary positions. One agreement for all covered positions would have sufficed.
Additionally, the documents do reflect your attendance in at least some of the Lodge meetings where the IAM National pension plan was discussed, including the pension rate for the Business Representative position. Finally, District Lodge 1 presented two payroll audit reports dated July 10, 2007 (auditing the period of January 2004 through December 2006) and May 23, 2014 (auditing the period of January 2011 through December 2013). Both reports found no discrepancies for the audit periods, including audit periods [when] you were employed as the District Lodge 1 organizer. You have not presented any documentary evidence such as an employment offer letter or employment agreement that commits District Lodge 1 to provide a pension through the Fund. In conclusion, none of the documentary evidence presented specifically and explicitly indicates that the Organizer position was intended by District Lodge 1 to be included in positions for which contributions to the Fund were to be made.

AR317-18 (emphasis in original).

         On June 26, 2017, plaintiff filed a complaint in this Court against the Fund and District Lodge 1 asserting ERISA violations and requesting recovery of his benefits. Compl. ¶¶ 13-21.

         STANDARD ...

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