documents or make oral representations contradictory to a previous summary description and still be said to have satisfied their ERISA disclosure obligations." Id. at 1160 (citations omitted). At first glance this language does seem helpful to plaintiff Aquilio. For several reasons though, the court does not agree with the plaintiff that Howard mandates a different result in this case.
In Howard the Court eventually upheld a grant of summary judgment in favor of the employer benefit provider, finding that defendants had complied with their ERISA obligations to inform Mr. Howard of his conversion rights under the plan. Id. The Court reasoned that the non-plan document upon which that plaintiff relied did not "undermine the adequacy of the summary plan descriptions because it does not contradict them." Id. Thus, because the Court did not find a contradiction between the SPD and the non-plan documents (a lay-off policy), it did not need to address under what circumstances it might be appropriate to look to non-plan documents in an ERISA case. Furthermore, the aspect of Howard upon which plaintiff places so much emphasis was purely dicta, and as such this court need not accord it a great deal of weight. See United States v. Johnson, 14 F.3d 766, 769 (2d Cir. 1994) (Court declining to follow its own earlier decision where intent issue not before Court in that decision, but was simply addressed in dictum). Consequently, the court does not find Howard particularly valuable in its analysis of the issues presented herein.
Turning now to the proof before the court on these motions, conspicuously absent is a particularized showing of conduct tantamount to fraud. Certainly union electioneering and competition between the union and the PBA, allegations which are not even specifically set forth in the complaint, are not the type of proof the Moore Court envisioned as being tantamount to fraud. Furthermore, although the factual record is not quite as compelling as it was in Moore, there is proof in the record before this court that, as in Moore, the US Life Certificate of Insurance as set forth in the policy itself, contained an express reservation of right to amend or terminate. Canfield Affidavit, exh. G thereto. That reservation of right was also contained in the US Life plan summary. Id., exh. A thereto. Additionally, as did the US Life policy, a number of PBA procured policies, of which plaintiff availed himself in the years preceding the US Life policy, also contained nearly identical reservation of rights clauses with respect to the right to amend or terminate coverage. See, e.g., Canfield Affidavit, exhs. C and D thereto.
Also, the court cannot overlook the fact that at least since 1980, all of the term life insurance contracts which the PBA had entered into on behalf of its members were limited in duration; they each had rates that the PBA could maintain only for a maximum of three years. Id. at P 27. This is fully consistent with PBA Treasurer Fairchild's representation that since 1961 only term life insurance was available through the PBA. Fairchild Affidavit at P 25. Further, PBA President Canfield avers, "No [PBA] term life insurance program that ever came to my attention offered fixed rates on a long-term basis, or for the life of the insured individual." Id. at P 26. Accordingly, because the record as a whole does not show "bad faith, intent to deceive or even conduct that was objectively, if unintentionally, misleading" on the part of the PBA, the court finds that under Moore the US Life policy and the plan summary exclusively govern the terms of the plan.
To this point the court has deliberately avoided one other important aspect of Moore and that is the fact that the plan there was unambiguous. Obviously then, if plaintiff Aquilio could show that the US Life plan is ambiguous, then the PBA's reliance upon Moore would be significantly undermined. Plaintiff is not able to do that, however. First of all, there are no allegations in the complaint that either the plan or the plan summary are ambiguous. Nor does plaintiff expressly argue on these motions that he should be permitted to rely on estoppel principles because the plan is ambiguous in some respect. In fact, in a slightly different context, at one point the plaintiff specifically contends that the 1985 communication was a "new plan" and "involved substantial modifications to the existing PBA plan." Plaintiff's Memorandum at 11 (emphasis added). Additionally, as previously stated, the plain language of both the policy and the plan summary indicated that the US Life policy could be changed or terminated at any time without notice. It is difficult to imagine language any more plain and unequivocal than the following: "The group policy is a contract between United States Life and the Policyholder. It may be changed or ended without notice to or consent of any insured person." Canfield Affidavit, exh G thereto. The present case can be easily contrasted with Kane where the Court found that "reasonable person could disagree as to [the] meaning and effect" of plan provisions. Kane, 893 F.2d at 1285. Based upon the plain and unequivocal language of the official plan documents before the court on these motions, the court is unable to find an ambiguity here. This absence of an ambiguity provides additional support for the court's view that Moore significantly impacts the present case.
E. Interpretation v. Modification
Absence of an ambiguity is significant for another reason. In deciding whether to permit application of federal common law estoppel principles in ERISA cases, some courts have focused on whether the plaintiff is seeking to interpret an ambiguous plan provision, as opposed to seeking modification of an unambiguous provision.
The Eleventh Circuit made this distinction in Kane when it allowed estoppel principles to be applied to a medical benefits plan because the plan provisions were ambiguous; and the plaintiff was relying on oral representations made by the insurer which interpreted but did not modify the plan terms. 893 F.2d at 1285-1286. Even if this court were to follow the Eleventh Circuit's lead in Kane,
and find that estoppel principles may be applied to interpret ambiguous plan provisions, plaintiff Aquilio still could not defeat the PBA's summary judgment motion on his first cause of action because, in contrast to Kane and its progeny, as previously noted, this plaintiff is arguing for a modification in the written US Life policy. He is not contending that the written plan itself is ambiguous and thus subject to interpretation by as the 1985, May, 1987, and October 29, 1987 written PBA communications. Consequently, as have other courts when faced with similarly unambiguous plan provisions,
this court concludes that even if it were to go so far as to adopt the reasoning of Kane and its progeny, plaintiff Aquilio would not be entitled to take advantage of the same because the plan documents here simply are not ambiguous. Thus Kane and its progeny do not alter the court's opinion that plaintiff Aquilio is not entitled to rely upon estoppel principles to circumvent the plain, unambiguous written terms of an unfunded welfare benefit plan - the US Life policy.
Plaintiff is not entitled to rely on estoppel principles based upon Kane for an additional reason. Besides requiring a showing of ambiguity, the rule enunciated in Kane only comes into play when the plaintiff is seeking to interpret a plan provision. Plaintiff Aquilio is not seeking to interpret an ambiguous plan provision; rather, by his own admission, he is seeking to modify unambiguous plan documents, and that he cannot do. The court's determination that plaintiff is prohibited from modifying the unambiguous plan documents is consistent with the position taken by several other Circuit Courts which have had occasion to examine cases factually similar to the present one. To illustrate, in Miller v. Coastal Corp., 978 F.2d 622 (10th Cir. 1992), cert. denied, U.S. , 113 S. Ct. 1586, 123 L. Ed. 2d 152 (1993), the Court refused to allow an ERISA plan to be modified under a theory of common law estoppel by informal written communications. Id. at 625. The Court reasoned that such modification would conflict with ERISA's explicit requirement that all modifications to an employee benefit plan be written. Id. (citing 29 U.S.C. § 1102(a)(1)). Further explained the Court, all plan modifications must also conform to ERISA's formal amendment procedures. Id. (citing 29 U.S.C. § 1102(b)(3)). Thus, even though the written communications upon which the plaintiff sought to rely in Miller consisted of summaries of his benefits under a pension plan sent annually over a ten-year period of time, the Court was still unwilling to permit the plaintiff to invoke estoppel principles. Id.
Likewise, in Coleman v. Nationwide Life Ins. Co., 969 F.2d 54 (4th Cir. 1992), the Fourth Circuit definitively held that "estoppel was unavailable to alter the unambiguous terms of an ERISA welfare benefit plan." Id. at 60. The Court there did not need to decide whether to follow the Eleventh Circuit's reasoning in Kane because that case "involved an outright modification, not an interpretation of the plan." Id. at 59. The Court explained: "estopping Nationwide [the defendant insurer] from terminating the contract of insurance when no premiums were paid would have the effect of providing [plaintiff] Coleman benefits even though the contract unambiguously indicates that she was entitled to none." Id. The Court concluded that such a result amounted to an impermissible modification of the plan's termination provision.
Coleman is significant for another reason. As in the present case, Coleman involved a dispute arising in connection with an employee welfare benefit plan, not a pension plan. Plaintiff Coleman attempted to convince the Court that because an employee welfare benefit plan was at issue, estoppel principles could still be applied because concerns over protecting the actuarial soundness of the plan were not present, as they would be with a pension plan. The plaintiff also pointed to the fact that welfare benefit plans are unfunded and thus lack the stringent accrual and vesting requirements of pensions plans. Id. at 59. The plaintiff was not successful on that argument; the Fourth Circuit declined to distinguish between pension plans and welfare benefit plans because, for one reason, ERISA's written instrument requirement applies to "every employee benefit plan." Id. (quoting 29 U.S.C. § 1102(a)(1)). Lastly, the Coleman Court persuasively reasoned that:
Several important purposes of ERISA would be impeded through use of estoppel principles in welfare benefit plan cases. ERISA is designed 'to promote the interests of employees and their beneficiaries in employee benefit plans,' . . . , as well as 'to protect contractually defined benefits,' . . . . It requires a crabbed reading of these purposes to suggest that they are directed solely at the actuarial soundness of pension plans. Indeed, the Seventh Circuit has recently recognized that 'one of ERISA's purposes is to protect the financial integrity of pension and welfare plans by confining benefits to the terms of the plans as written.' . . . The financial integrity of a group health insurer could be quickly compromised if courts compelled the insurer to assume risks for which no premium was ever paid. Moreover, if courts allowed estoppel to be used to modify ERISA plans, plan assets could also be chewed up in costly, litigious disputes over what informal modifications may have been made to a written instrument.
Id. at 60 (internal citations omitted) (emphasis in Coleman).
To summarize, as to plaintiff's first cause of action, the court concludes that plaintiff Aquilio is not entitled to rely on federal common law estoppel principles because the plan documents, consisting of the policy and the plan summary, contain a clear and unequivocal reservation of the right to terminate or amend the subject plan. In light of this finding, the court need not decide whether to adopt the interpretation/modification distinction set forth in Kane; but even if it did adopt the same, nevertheless, plaintiff Aquilio could not prevail because the plan documents are not ambiguous. In addition, by seeking life insurance coverage in perpetuity under the US Life policy, clearly plaintiff is seeking an extension of coverage beyond that specified in any of the governing plan documents. Thus, assuming without deciding its applicability, Kane is also inapposite on this basis. Finally, to paraphrase the Eleventh Circuit in Alday, this plaintiff's right to lifetime life insurance coverage at "any particular cost can only be found if it is established by contract under the terms of the ERISA-governed benefit plan document." 906 F.2d at 665 (citing Moore, 856 F.2d at 492).
Unfortunately for this plaintiff, the plan's terms simply do not provide for the type of coverage he seeks in this action.
F. Merits of Equitable and Promissory Estoppel
Even assuming arguendo that the court sided with plaintiff and found that this case presented appropriate circumstances warranting the application of federal common law estoppel principles, the court has serious reservations as to whether plaintiff could ultimately survive the PBA's summary judgment motion on his estoppel based cause of action. That is so because it appears that the plaintiff has not come forth with any evidence creating a genuine issue of material fact. More specifically, insofar as plaintiff's first cause of action can be read as asserting an independent claim for equitable estoppel, such claim would in all likelihood fail as a matter of law on the present record due to lack of an affirmative misrepresentation. In Lee v. Burkhart, previously mentioned, the Second Circuit found that the plaintiff did not sufficiently assert an equitable estoppel claim because his proposed complaint did not allege that an affirmative misrepresentation by the defendant. 991 F.2d at 1010.
The same is true here. Moreover, "ERISA bars only material misrepresentations." Andre, supra, 797 F. Supp. at 1427 (emphasis in original). Thus, as the Andre court convincingly explained, in language which could have been written with the present case in mind:
It [ERISA] does not impose an affirmative duty to explain benefit plans with the utmost clarity. Thus an employee's lack of care in reading corporate documents does not support the proposition that the company has misled the employee. No doubt it is possible for an employer to issue documents so garbled and ambiguous, so apt to mislead, that the employer would later be estopped from denying benefits although it had made no specific misrepresentations. But that is not this case. Salem's documents were clear enough to put Andre on notice that his enrollment in the health plan would not occur without some further effort on his part.
Id. Likewise in this case, the court is simply not convinced that the present record supports a finding of a material misrepresentation; nor does the record reveal a genuine issue of material fact with respect thereto.
Similarly, it appears that plaintiff has failed to show that there is a genuine issue of material fact as to his promissory estoppel claim, which the court believes is also encompassed in his first cause of action. One possible weakness which comes readily to mind is the lack of evidence even tending to support the view that plaintiff's reliance on the three PBA communications was both reasonable and foreseeable, a necessary element of any promissory estoppel claim. Indeed the evidence seems to support the exact opposite view. None of the three PBA communications relied upon by plaintiff Aquilio contains an explicit promise to provide group term life insurance at a fixed rate for the remainder of plaintiff's life. What is more, those communications speak in terms of "current" life insurance costs, and in some instances reference the US Life policy which by its terms was effective for only three years, at most. Thus, the court observes, without necessarily deciding, that even if plaintiff could surmount the high barriers to asserting a federal common law promissory estoppel claim, he could not survive the PBA's summary judgment on such claim. See Doe v. General American Life Ins. Co., 815 F. Supp. 1281, 1286 (E.D.Mo. 1993) (defendant insurer's motion for summary judgment granted where "the facts [did] not warrant a finding of a federal common law claim for promissory estoppel"). Further, the court observes, again without deciding, that it also seems highly unlikely, given the current state of the record, that plaintiff Aquilio has sustained an "unconscionable injury," another element of a promissory estoppel claim. See Schwartz, supra, 653 F. Supp. at 389 n.1.
In short, while the court is sympathetic to plaintiff's plight, after carefully examining the applicable law, from many angles, the court is left with the firm conviction that the PBA's motion for summary judgment on plaintiff's first cause of action must be granted. In the end, the particular facts of this case do not allow the plaintiff to invoke either equitable or promissory estoppel. The subject plan is not ambiguous; the plaintiff is not seeking to interpret the plan; the record does not support a finding of conduct tantamount to fraud on the part of the PBA; plaintiff is not a victim of extraordinary circumstances; and, in all likelihood, even from a strictly factual standpoint, the record does not seem to support plaintiff's estoppel based cause of action.
II. ERISA Disclosure Violations
In his second cause of action, apparently plaintiff is alleging that the PBA violated certain ERISA provisions pertaining to the disclosure of plan information, although he does not specify the statutory basis for any aspect of this cause of action. Plaintiff's first purported violation arises out of the fact the he did not receive the US Life plan summary advising him that the policy was cancelable. Complaint at P 18. And, according to plaintiff, the fact that he did not receive that document indicates that the PBA failed to maintain an adequate and reliable mailing and notification procedure. Id. at P 19. Evidently plaintiff believes that this alleged deficiency states an independent violation of ERISA. There is one final component to this second cause of action and that is plaintiff's assertion that, upon information and belief, the PBA violated ERISA disclosure requirements because of "the currently unfulfilled representation that the PBA would be sending out summary booklets for the new life insurance program adopted in 1990 before the end of the winter of 1990-91," . . . ." Id. at P 21. Plaintiff now concedes that this last allegation has become moot due to the fact that the PBA has since provided the requested documentation. See Plaintiff's Memorandum at 14. Consequently, in light of that concession, the court will not bother to address this portion of the second cause of action.
As to the remaining aspects of this cause of action, the PBA contends that such cause of action is barred as a matter of law because plaintiff did not exhaust his administrative remedies. More specifically, prior to commencing this lawsuit, he did not submit a written demand for the documents he is seeking herein. The PBA further contends that plaintiff's attempt to satisfy the statutory written demand requirement by a letter from his attorney submitted after the commencement of this action is not sufficient because without a pre-action demand letter this action was prematurely filed. The PBA thus declares that this action does not present "a 'ripe' case or controversy." PBA Memorandum at 23. In rejoinder the plaintiff states that the PBA misconstrues the nature of this cause of action, and thus the statutory notification argument is wholly inapplicable. Plaintiff then cross moves for summary judgment, contending that as a matter of law the PBA violated ERISA disclosure provisions with respect to the 1985 letter from PBA Treasurer Fairchild
because the PBA did not prepare and distribute a plan summary in conjunction therewith within the required time frame. A central premise of this argument is that that 1985 letter amounted to a misleading plan summary, and thus plaintiff is not limited to "the contradictory terms of the policy the PBA now offers, . . . ." Plaintiff's Memorandum of Law at 15. At a minimum, even if the court does not grant summary judgment in plaintiff's favor on his cross-motion, he believes that he has created a fact issue as to the methods employed by the PBA to distribute the 1987 US Life plan summary; and thus the PBA's motion for summary judgment on this second cause of action must be denied.
Before considering the relative merits of these positions, a brief summary of the facts relevant to this particular cause of action is in order. The affidavits of PBA President Canfield, Treasurer Fairchild, and Office Manager Erhardt outline in quite some detail the PBA's office practices with respect to mass mailings, particularly those pertaining to insurance matters. See, e.g., Erhardt Affidavit at PP 11-21. A few aspects of that procedure are worth noting. First, "since approximately 1980, all mailing sent to participants at the PBA plan have [sic] been computerized." Id. at P 11. The names and addresses of plan participants, along with other insurance-related information is entered into the computer through normal data entry, and reviewed for accuracy several times a year. Id. at P 13. If a PBA document is returned as non-deliverable due to an incorrect address, the PBA then tries to contact the member to ascertain the new address. Id. at P 14. If the PBA is unsuccessful in that regard, the document is remailed with directions to forward. Id. Efforts are then made to ascertain the participant's new address through other means. Id.
As to plaintiff Aquilio, the PBA's records indicate that his correct address has been in the computer since at least 1980. Id. at P 15. Interestingly, in approximately November, 1990, plaintiff went to the PBA office claiming that he had not received certain correspondence. Id. at P 16. In plaintiff's presence, Office Manager Erhardt generated a mailing list which accurately reflected plaintiff's name and address. Id. With respect to the 1987 US Life plan summary in particular, Ms. Erhardt explicitly avers that she "personally oversaw" their mailing "to all plan participants and was subsequently made aware, through questions from numerous plan participants regarding these summaries, that these summaries were, in fact, mailed and received by plan participants." Id. at P 26 (emphasis in original).
For his part, even though he claims not to have received the US Life plan summary, plaintiff does not allege in his complaint that he ever requested the same from the PBA. Likewise, there are no allegations in the complaint that the plaintiff ever requested in writing from the PBA a plan summary for the insurance program adopted in 1990. After the commencement of this lawsuit, however, plaintiff's attorney did request certain documentation from the PBA in a letter dated November 18, 1991; and within thirty days of the receipt of that letter, the requested information was provided.
PBA's Memorandum of Law at 22 n. 8.
The general duty to disclose under ERISA is found in section 1021 of that statute. Section 1024(b)(5) provides though that:
The administrator shall, upon written request of any participant or beneficiary, furnish a copy of the latest updated summary plan description, and the latest annual report, any terminal report, the bargaining agreement, trust agreement, contract, or other instruments under which the plan is established or operated.
29 U.S.C. § 1024(b)(4) (West 1985). ERISA's Civil Enforcement provision provides that failure to comply with that statute may, in the court's discretion, result in the plan administrator being liable to the participant "in the amount of up to $ 100 a day from the date of such failure or refusal, and the court may in its discretion order such other relief as it deems proper." 29 U.S.C. § 1132(c)(1)(B) (West Supp. 1994).
Insofar as plaintiff's second cause of action can be read as claiming that the PBA is liable for failure to provide certain information as dictated by ERISA, such as a plan summary, the court agrees with the PBA that plaintiff's failure to make the requisite written demand under 29 U.S.C. § 1024(b)(4) bars this cause of action. See Rinard v. Eastern Co., 769 F. Supp. 1416, 1429 (S.D.Ohio 1991), rev'd on other grounds, 978 F.2d 265 (6th Cir. 1992), cert. denied, U.S. , 113 S. Ct. 1843, 123 L. Ed. 2d 468 (1993) (citation omitted) ("Plaintiffs have not stated a claim against Eastern under § 1132(c), since that section requires that a request for information be made to the administrator to which the administrator refuses a reply."); First Atlantic Leasing Corp. v. Tracey, 738 F. Supp. 863, 875-876 (D.N.J. 1990) (claim based upon 29 U.S.C. § 1024(b)(4) barred by party's failure to make a request to the plan administrator and wait thirty days before commencing the suit).
Furthermore, plaintiff cannot overcome this procedural hurdle by relying on the demand letter from his attorney, sent after the commencement of this lawsuit. A similar attempt to circumvent the written request requirement of section 1024(b)(4) was rejected by the court in First Atlantic. There the court reasoned that the plaintiff "should not be permitted to commence suit before his cause of action has even accrued." 738 F. Supp. at 876 (emphasis in original) (citation omitted). The court further reasoned that it lacked jurisdiction over a claim for failure to provide ERISA information "because the suit was filed prematurely and thus, there was not 'ripe' case or controversy. Id. (citation omitted). Thus plaintiff cannot rely upon his attorney's belated demand letter to satisfy the condition precedent for bringing a suit under 29 U.S.C. § 1024(b)(4).
Based strictly upon the allegations in the complaint, the foregoing should completely dispose of plaintiff's second cause of action. However, in response to the PBA' summary judgment motion, for the first time, plaintiff alleges that the 1985 letter from PBA Treasurer Fairchild constitutes a misleading SPD, which the court should treat as a plan document. As he did in his first cause of action, apparently plaintiff is once again relying upon 29 U.S.C. § 1132(a)(1)(B) as the statutory basis for this claim. Assuming for the moment, (1) plaintiff's complaint can even be read as alleging a claim based upon a misleading plan summary, and (2) that such a claim is properly brought under this statute,
the court concludes that on the present record the 1985 PBA letter from Treasurer Fairchild did not amount to a plan summary.
ERISA contains an explicit provision governing plan descriptions and SPDs. See 29 U.S.C. § 1022. Regardless of whether plaintiff characterizes the 1985 letter as a SPD or a plan description,
when that letter is compared to section 1022, which comprehensively lists what must be contained in such documents, there is no doubt that it cannot qualify as either. The court will not list each element of section 1022 which is missing from the 1985 letter, but, to illustrate, it will note a few relatively significant omissions. First of all that letter does not specify "circumstances which may result in disqualification, ineligibility, or denial or loss of benefits[.]" 29 U.S.C. § 1022(b) (West 1985). Also absent from the 1985 letter "the procedures to be followed in presenting claims for benefits under the plan and the remedies available under the plan for the redress of claims which are denied in whole or in part[.]" Id. In light of the foregoing, the court finds that plaintiff's cross-motion for summary judgment on his second cause of action must be denied in its entirety; and conversely that the PBA's motion for summary judgment on this cause of action must be granted.
III. Attorney's Fees and Expenses
Based upon the foregoing, at this point, it should be painfully clear to the plaintiff that the court will not entertain that part of his motion seeking attorney's fees and costs under 29 U.S.C. § 1132(g)(1). Plaintiff's request for the same is in all respects denied.
Accordingly, for the reasons set forth herein, the motion for summary judgment pursuant to Fed. R. Civ. P. 56 by the defendant, Police Benevolent Association of The New York State Troopers, Inc., is hereby GRANTED in its entirety. The cross-motion for partial summary judgment by the plaintiff, Dominick J. Aquilio, as to the second cause of action is DENIED. That part of plaintiff's cross-motion seeking statutory attorney's fees and costs is also DENIED.
The Clerk is directed to enter judgment in accordance with the above.
IT IS SO ORDERED.
DATED: June 14, 1994
Syracuse, New York
Neal P. McCurn
Senior U.S. District Judge