The opinion of the court was delivered by: THOMAS GRIESA, Senior District Judge
This is a dispute about residual assets of a pension plan. The
plan was administered by defendant Metropolitan and the assets in
dispute are being held by defendant Mellon. The actual dispute is
between plaintiff Lockheed and defendant Singer N.V.
The pleadings which are relevant to this motion consist of a
Second Amended Complaint filed by plaintiff and defendant Singer
N.V.'s Answer to the Second Amended Complaint, which includes
various counterclaims and cross-claims. Singer N.V. moves for judgment on the pleadings. Lockheed
opposes that motion and cross-moves for summary judgment.
The Court has received extensive written submissions, and oral
argument was held yesterday.
Singer N.V.'s motion for judgment on the pleadings is denied.
Lockheed's cross-motion for summary judgment is denied, with
leave to renew after there is further discovery.
One of several pension funds established many years ago by the
entity known as The Singer Company ("Singer") was the Executive
Office Foreign Service Plan (the "EOFS Plan"). In connection
therewith, Singer purchased Group Annuity Contract No. 365F ("GAC
365F") from MetLife. It appears that $4 million remains subject
to these arrangements but is not needed to satisfy any further
pension obligations. It further appears that when MetLife
converted from a mutual insurance company to a corporation,
whoever was the owner of GAC 365F became entitled to 46,434
shares of common stock of MetLife. The money and the shares
constitute the assets in dispute. The proper disposition of these assets depends largely on the
interpretation of a reorganization agreement between Singer and
SSMC Inc. dated July 18, 1986. Plaintiff Lockheed is the
successor-in-interest to Singer. Defendant Singer N.V. is the
successor-in-interest to SSMC Inc.
Singer N.V. contends that the 1986 agreement contained
provisions which unquestionably transferred to SSMC the pension
plan in question (the EOFS Plan) and the contract with MetLife
(GAC 365F), and that therefore any assets which have now accrued
to GAC 365F belong to SSMC's successor, defendant Singer N.V.
Since the 1986 agreement is part of the pleadings, Singer N.V.
urges that it is entitled to judgment on the pleadings.
Lockheed relies both on the pleadings and certain additional
submissions and seeks summary judgment. Lockheed contends that
the 1986 agreement can only be interpreted as transferring
certain specified pension plans to SSMC, and that since the
pension plan at issue in this case was not included in those
specifically dealt with, it was not transferred, but remained
Lockheed contends that subsequent to the 1986 agreement, it
acted in a manner consistent with its being the owner of the EOFS
Plan and GAC 365F, and that SSMC acted in a manner inconsistent with SSMC
being the owner. SSMC makes certain contrary allegations. It is
agreed by both sides that in August 2000, when MetLife decided to
discontinue administering the EOFS Plan, it notified Singer N.V.
(the successor to SSMC) that the residual funds were being held
for Singer N.V., but the parties are in disagreement about the
significance of this.
The issue under the 1986 agreement is not as clear as either
Section 2.01 of that agreement provided that the assets and
liabilities of Singer's sewing and furniture businesses were
transferred to "the Former Singer Businesses," consisting of 42
companies listed in Schedule I attached to the agreement. Section
2.02 of the agreement went on to provide that Singer would
transfer to SSMC the shares of stock of the corporations
comprising the Former Singer Businesses.
Section 4.02 provided that SSMC would assume the liabilities of
all of the operations and businesses included in the Former
At the oral argument the Court raised a question about the significance of the fact that Section 2.01 provided that assets
and liabilities would be transferred to the Former Singer
Businesses and that what SSMC was to receive, pursuant to Section
2.02, was shares of stock rather than a transfer of assets and
liabilities. At the argument both sides agreed that the net
effect of the relevant provisions was that the assets and
liabilities referred to in these sections came under the
ownership of SSMC. Neither side makes any ...