United States District Court, S.D. New York
March 17, 2004.
CONSTANCE S. KEISER, Plaintiff, -against- CDC INVESTMENT MANAGEMENT CORP., et al., Defendants
The opinion of the court was delivered by: WILLIAM PAULEY, District Judge
MEMORANDUM AND ORDER
On March 25, 2003, this Court issued a Memorandum and Order that,
inter alia, granted defendants CDC Investment Management Corp.'s, CDC
Capital Incorporated Long Term Disability Income Plan's and CDC Capital
Incorporated Life Insurance Plan's (collectively "CDC") motion for
summary judgment on the grounds that extra-contractual legal relief is
not available under ERISA. See Keiser v. CDC Inv. Mgmt. Corp., et al.,
No. 99 Civ. 12101 (WHP), 2003 WL 1733729, at *7-9 (S.D.N.Y. Mar. 25,
2003) ("Keiser II"). On April 4, 2003, plaintiff Constance S. Keiser
moved for a partial reconsideration of that Memorandum and Order,
arguing, inter alia, that this Court overlooked Second Circuit precedent
upholding similar ERISA promissory estoppel claims. As it appears this
Court overlooked certain aspects of controlling decisions in dismissing
plaintiff's promissory estoppel claim, plaintiff's motion for
reconsideration is granted. However, Keiser fails to establish a cause of
action under ERISA promissory
estoppel principals in this Circuit. Therefore, upon reconsideration
CDC's underlying motion for summary judgment is granted on grounds
different than those enumerated in Keiser II.
I. Standard for a Motion for Reconsideration
Local Civil Rule 6.3 provides in relevant part: "There shall be served
with the notice of motion a memorandum setting forth concisely the
matters or controlling decisions which counsel believes the court has
overlooked." Thus, to be entitled to reconsideration, a movant must
demonstrate that the Court overlooked controlling decisions or factual
matters that were put before it on the underlying motion, which, had they
been considered "might reasonably have altered the result reached by the
court." Consol. Gold Fields v. Anglo Am. Corp., 713 F. Supp. 1457, 1476
(S.D.N.Y. 1989). The decision to grant or deny a motion for
reconsideration is within the sound discretion of the district court. See
Dietrich v. Bauer, 76 F. Supp.2d 312, 327 (S.D.N.Y. 1999); AT&T Corp. v.
Microsoft Corp., No. 01 Civ. 4872 (WHP), 2004 WL 309150, at *1 (S.D.N.Y.
Feb. 19, 2004).
II. plaintiff's Argument for Reconsideration
The underlying facts in the dispute are laid out in detail in Keiser
v. CDC Inv. Mgmt. Corp., et al., 160 F. Supp.2d 512, 514-16 (S.D.N.Y.
2001) ("Keiser I") and Keiser II, 2003 WL 1733729, at *l-2, and are not
In Keiser II, this Court granted CDC's motion for summary judgment
against plaintiff on the grounds that plaintiff's promissory estoppel
claim against CDC sought "extra-contractual legal relief . . . [that] is
not recoverable under ERISA." 2003 WL 1733729, at *7. On
reconsideration, plaintiff argues that, while this Court is correct that
a promissory estoppel claim is not available to her under ERISA §
502(a)(3), 29 U.S.C. § 1132 (a)(3), her claim against CDC arises under
§ 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B). Plaintiff claims that, in
contrast to § 502(a)(3), the Second Circuit has "repeatedly affirmed the
validity of ERISA promissory estoppel claims" arising from violations of
§ 502(a)(1)(B), and that this Court overlooked controlling decisions in
that regard. (Pl. Mem. at 5.) See, e.g., Devlin v. Empire Blue Cross and
Blue Shield, 274 F.3d 76, 85-86 (2d Cir. 2001) ("Devlin II"); Abbruscato
v. Empire Blue Cross and Blue Shield, 274 F.3d 90, 100-02 (2d Cir. 2001);
Aramony v. United Way Replacement Benefit Plan, 191 F.3d 140, 151-53 (2d
Cir. 1999); Devlin v. Transportation Communications Int'l Union,
173 F.3d 94, 101-102 (2d Cir. 1999)
("Devlin I"); Schonholz v. Long Island Jewish Medical Center, 87 F.3d 72,
79-80 (2d Cir. 1996).
While this Court considered the above-mentioned decisions in granting
CDC's motion for summary judgment in Keiser II, it conflated plaintiff's
claims under § 502(a)(3) and § 502(a)(1)(B), thus overlooking
distinguishing factors in those decisions that "might reasonably have
altered the result reached by the court." Consol. Gold Fields, 713 F.
Supp. at 1476. Accordingly, plaintiff's motion for reconsideration of
those portions of Keiser II which granted CDC's motion for summary
judgment on plaintiff's promissory estoppel claim is granted. This,
however, does not end the inquiry, as this Court must now consider the
merits of plaintiff's promissory estoppel claim in light of CDC's motion
for summary judgment.
III. Plaintiff's ERISA Promissory Estoppel Claim
Promissory estoppel for ERISA claims requires satisfaction of four
elements: "`(I) a promise, (2) reliance on the promise, (3) injury caused
by the reliance, and (4) an injustice if the promise is not enforced,'"
Aramony, 191 F.3d at 151 (quoting Schonholz, 87 F.3d at 79). To minimize
"the danger that commonplace communications from employer to employee
will routinely give rise to employees' rights beyond those contained in
formal benefit plans," the Second Circuit has added a fifth
element: "extraordinary circumstances." Aramony, 191 F.3d at 151.
In the heartland of cases analyzing ERISA promissory estoppel, courts
find extraordinary circumstances only where an employer engages in
intentional inducement or deception of an employee with respect to
benefits in order to persuade that employee to take some action that
inures to the employer's benefit. See, e.g., Devlin II, 274 F.3d at 86
(finding sufficient facts existed supporting plaintiff's claim that they
were intentionally induced to remain with company with promise of
lifetime insurance benefits that were later reduced); Aramony, 191 F.3d at
152 ("[The plaintiff] points to nothing beyond the ordinary about the
circumstances surrounding the promises allegedly made to him. . . .
Nothing, for example, suggesting that [the defendant] made a promise to
[the plaintiff] in order to induce him to take action for [the
defendant's] benefit only to later renege on the promise."); Schonholz, 87
F.3d at 79 (finding extraordinary circumstances where employer promised
severance benefits as an inducement to persuade the plaintiff to retire);
Hart v. The Equitable Life Assurance Soc., No. 02 Civ. 2364 (HB), 2002 WL
31682383, at *5 (S.D.N.Y. Nov. 26, 2002) (granting summary judgment to
defendant on plaintiff's ERISA promissory estoppel claim on grounds that
plaintiff failed to demonstrate intentional inducement or other
circumstances). While not expressly limited to "circumstances of
inducement," Devlin II, 274 F.3d at 86, such actions by an employer must
be "beyond the ordinary." Aramony, 191 F.3d at 152; see also Devlin I, 173
F.3d at 102 ("[T]here is evidence . . that some employees . . .
considered the promised medical benefits in timing their retirements. But
reliance is one of the four basic elements of promissory estoppel, and
would not by itself render this case `extraordinary,'").
Even after resolving any ambiguities and drawing all justifiable
inferences in plaintiff's favor, as this Court is required to do on
summary judgment, see Celotex Corp. v. Catrett, 477 U.S. 317, 330 n. 2
(1986), plaintiff cannot demonstrate any extraordinary circumstances to
support her ERISA promissory estoppel claim. In this case, plaintiff
admits that she and CDC mutually agreed to terminate their relationship
in March 1996. (Affirmation of Constance S. Reiser, dated July 1, 2002 1
2; Declaration of Constance S. Keiser, dated September 11, 2000 ¶ 17.)
While plaintiff claims that she relied on CDC's representations
concerning the continuation of her LTD coverage in deciding to resign,
such reliance is insufficient to support an ERISA promissory estoppel
claim because "reliance is one of the four basic elements of promissory
estoppel, and would not by itself render this case `extraordinary.'"
Devlin I, 173 F.3d at 102. Unlike the plaintiffs in Schonholz and Devlin
has not proffered sufficient evidence to show that CDC intentionally
induced or deceived her with respect to her LTD benefits, or otherwise
demonstrated circumstances "beyond the ordinary." Aramony, 191 F.3d at
152; accord Ramos v. SEIU Local 74 Welfare Fund, No. 01 Civ. 2700 (SAS),
2002 WL 519731, at *6 (S.D.N.Y. April. 5, 2002) (in granting summary
judgment to defendant, holding that "[the plaintiff] cannot adduce
evidence to justify a finding of extraordinary circumstances . . .
[because] [t]here is no hint of deception or intentional inducement");
Hart, 2002 WL 31682383, at *5 (in granting defendants' motion for summary
judgment on plaintiff's ERISA promissory estoppel claim, distinguishing
Devlin II by noting that "[i]n that case, the court found that defendant
had intentionally induced plaintiffs with the promise or `lure' of
lifetime insurance benefits"). Accordingly, this Court adheres to its
earlier determination granting CDC's motion for summary judgment, albeit
for different reasons than those set forth in Keiser II, 2003 WL
1733729, at *7-9.
For the reasons set forth above: (1) plaintiff Constance S. Keiser's
motion for partial reconsideration of this Court's March 25, 2003
Memorandum and Order is granted; and (2) upon reconsideration, CDC
Investment Management Corp.'s, CDC Capital Incorporated Long Term
Disability Income Plan's and CDC Capital Incorporated Life Insurance
Plan's motion for summary judgment against plaintiff Constance S. Keiser
is granted for reasons different than those set forth in Keiser II.
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