The opinion of the court was delivered by: WEINFELD
OPINION FINDINGS OF FACT AND CONCLUSIONS OF LAW
Plaintiff, Michael Don Romacho, a former employee of Bowne New York, Inc. ("Bowne"), commenced this action against the Trustees of the Bowne Profit-Sharing Plan and Trust (the "Plan") pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA")
because of their refusal to accelerate distribution of his vested interest in the Plan's fund ("Fund") on the termination of his employment. Two other former employees of Bowne brought similar actions against the Trustees in this Court with differing results.
This Court, upon the totality of the record before it, concludes that the Trustees' denial of plaintiff's claim for immediate payment of his retirement benefits, which are not due until his 65th birthday, was not arbitrary or capricious and that their determination was rationally made and in good faith.
Bowne is a New York corporation with subsidiaries in various locations in the United States. It engages primarily in fiancial and corporate printing.
Plaintiff was employed in the production department of the New York susidiary from May 5, 1968 to July 11, 1980, when, at the age of 33, he voluntarily resigned to accept employment with Pandick Press, Inc. ("Pandick"). Pandick is a direct competitor of Bowne, located in the same building.
Approximately two weeks before plaintiff resigned, John Morse, Vice President of Sales and one of the most successful salesman at Bowne, accepted employment with Pandick. Morse took with him to Pandick a large volume of Bowne's business, the United Investment Trust Work, a profitable account with revenues of between two and two and one-half million dollars per year. After Morse's move to Pandick, the Bowne customers moved their business there and because of Romacho's familiarity with the United Investment Trust Work, Morse, shortly after his own resignation recruited Romacho to join him at Pandick. Morse later recruited another Bowne employee, Robert Cohen, to join Pandick, also to work in part for those same clients who had switched from Bowne to Pandick when Morse made his move.Cohen, whose position at Bowne was pricing analyst, joined Pandick in March 1981.
The Bowne Plan is a deferred profit sharing plan funded by contributions from the profits of participating Bowne subsidiaries. There is no employee contribution. The Plan was established in 1961 and amended several times thereafter. The 1972 version of the Plan contained a "forfeiture provision," which in substance provided that if a participant in the Plan left the employ of Bowne to enter into competition with it or became an employee of a direct competitor, he ceased to be a participant in the Plan and forfeited his interest therein, whether vested or not.
To comply with the requirements of ERISA, the Plan was restated in June 1977 and the forfeiture provision was deleted.
Plaintiff was a participant in the Plan at the time of his resignation and had a vested interest in the sum of $47,481.59. The Plan then in effect provides that vested profit-sharing benefits shall be paid within sixty days after the later of:
(a) the earlier of the participant's Normal Retirement Date (age 65), or Early Retirement Date (at least age 60 upon completion of 30 years of service);
(b) the date of the participant's termination from employment.
When Romacho left Bowne's employ he was 33 years of age and had twelve years' service. Thus, he is not entitled to receive his vested benefits until age 65, his normal retirement age. However, the Plan provides that the Trustees may establish procedures to make distribution of benefits to a terminated participant at a date prior to an employee's attainment of age 65 or earlier retirement date.
The Plan further grants authority to the Trustees to construe and interpret the provisions of the agreement and provide that
[a]ny decision or act made or done by the Trustees pursuant to any provision of the Plan shall be in their sole and absolute discretion.
A summary booklet entitled "Highlights of the Bowne Profit Sharing Plan for Employees of Participating Companies of Bowne & Co., Inc." (the "Summary") was distributed to all Plan participants, including Romacho. In addition to describing the mandatory payment provisions at normal and early retirement dates, the Summary states that "[t]he method and time of making payment shall be determined by the Trustees in their sole discretion. . . ."
From the time of the restatement of the Plan in 1977 until Romacho and Morse sought acceleration, seventy-nine Plan participants who left Bowne requested and were granted accelerated payment of the vested amount in their Plan account. The amounts paid to these former employees ranged from $45.92 to $70,236.83. Nine of the former employees received payments in excess of $10,000. Whether any of these nine were employed by ...