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CASSIN v. PRUDENTIAL INSURANCE COMPANY OF AMERICA

October 19, 2004.

JOHN M. CASSIN, Plaintiff,
v.
PRUDENTIAL INSURANCE COMPANY OF AMERICA, Inc., PRUDENTIAL SECURITIES, Inc., and PRUDENTIAL FINANCIAL, INC., Defendants.



The opinion of the court was delivered by: SHIRA SCHEINDLIN, District Judge

MEMORANDUM OPINION AND ORDER

John Cassin is suing his former employer, the Prudential Insurance Company of America ("Prudential"), for allegedly breaching its promise to provide him with certain pension benefits.*fn1 On April 15, 2004, Prudential removed the suit to this Court on the basis of federal preemption under the Employee Retirement Income Security Act ("ERISA"). Prudential now moves to dismiss Cassin's First Amended Complaint, arguing, inter alia, that it is time-barred. Cassin concedes that his claim as pled in the First Amended Complaint is time-barred, but seeks leave to amend. At the Court's request, Cassin has submitted a proposed Second Amended Complaint ("Proposed Complaint"). Prudential opposes Cassin's request for leave to amend. For the following reasons, Cassin is granted leave to file his Proposed Complaint.

  I. BACKGROUND

  A. The First Amended Complaint

  The following facts are taken from Cassin's First Amended Complaint. In 1984, Cassin was hired by the Prudential-Bache Trade Corporation ("PBTC") to manage a private bank in Luxembourg ("the Bank"). In 1989, Prudential purchased the Bank and assumed PBTC's obligations to Cassin. Cassin was enrolled in Prudential's pension plan.

  In 1991, Prudential instructed the Bank to convert Cassin from an expatriate employee to a local Luxembourg employee, removing Cassin from the Prudential pension plan. Prudential instructed the Bank to establish a "reasonable supplementary pension plan" for Cassin. The Bank informed Cassin of its intention to create such a reasonable supplementary plan for him. Based on this representation, Cassin maintained his employment with the Bank in the expectation that he would be provided with a reasonable supplementary pension plan, equivalent in value to the Prudential pension plan.

  In 2002, the Bank closed and, pursuant to a settlement agreement, Cassin was paid his salary and benefits through July, 2003. At this point, Cassin "realized that [Prudential] had not provided him with a `reasonable supplementary pension plan.'"*fn2 Cassin states that Prudential "never established a supplemental pension plan,"*fn3 but later states that his "pension status is unclear."*fn4 Regardless of whether a supplementary plan was created for Cassin or not, he now alleges that the benefit he has received is not "reasonable." Cassin's "current employer financed benefit for his Prudential service is $187,770," $312,219 less than it would have been if he had remained in the Prudential pension plan.*fn5

  On the basis of these facts, Cassin claims that, in 1992, Prudential breached its fiduciary duties owed to him under ERISA, 29 U.S.C. ยงยง 1104 and 1132(a)(3), by misrepresenting that he would receive a reasonable supplementary pension benefit. Cassin now concedes that this claim is untimely as pled. Claims for breach of fiduciary duty under ERISA must be brought within the earlier of six years from the alleged breach, or three years from discovery of the breach.*fn6 To the extent that Cassin's claim is based on a breach that occurred in 1992, it is unquestionably time-barred. Cassin therefore seeks leave to file an amended complaint.

  B. Cassin's Proposed Complaint

  Cassin's Proposed Complaint omits many of the factual details set out above, and states a new theory of liability. What follows are the facts as alleged in the Proposed Complaint.

  Cassin now states simply that "as an employee of [Prudential] and its subsidiaries, [Cassin] was a participant and a beneficiary of the pension plan administered by [Prudential]. [Prudential] agreed to establish a supplementary pension for [Cassin] when it converted him to a local Luxembourg employee."*fn7 However, Cassin has abandoned the theory that Prudential misrepresented its intention to establish a supplementary plan in 1992. Cassin's new theory is that no breach of fiduciary duty took place until 2003, when Prudential "purported to conduct an independent review of [Cassin's] pension benefits to determine if the supplementary pension had served its purpose."*fn8 In this review, Prudential "was acting in its fiduciary capacity as the plan adminstrator, and was required to make a discretionary decision concerning the value of [Cassin's] pension benefit."*fn9 Prudential determined that the supplementary plan was "reasonable," and therefore refused to "correct the shortfall which arose regarding his pension payments."*fn10 Cassin alleges that this was a breach of fiduciary duty, because Prudential was not acting solely in his interests in conducting this review.

  II. LEGAL STANDARD

  A. Leave to Amend

  Whether to permit a plaintiff to amend his pleadings is a matter within the Court's "sound discretion."*fn11 Rule 15(a) instructs that leave to amend should be "freely given."*fn12 Leave to amend should be denied, however, where the proposed amendment would be futile, if there is undue delay, bad faith, or dilatory motive, or where the opposing party would suffer undue prejudice.*fn13 The request for leave to amend "will be denied as ...


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