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United States District Court, S.D. New York

June 22, 2005.


The opinion of the court was delivered by: LEWIS KAPLAN, District Judge


Plaintiff contends he wrongly was denied benefits due under his company's ERISA plan. Defendants move to dismiss on the ground that plaintiff was not a plan "participant." I

  According to the complaint, Martin Nahoun was employed by Credit Suisse First Boston ("CSFB") from April 1982 until April 1995 as a vice president in the equities department. In January 1997, Nahoun returned to CSFB to become a vice president/project manager in the equities and fixed income divisions. The complaint further alleges that

"[a]lthough Nahoun was given the title `independent contractor' on or about December 15, 1997, he was never treated like one. Moreover, in 1999, CSFB effectively removed the `independent contractor' designation by: (a) exempting Nahoun from policies then promulgated that were applicable to independent contractors but not employees, including a requirement that independent contractors submit periodic statements of work performed to obtain future work from CSFB; and (b) requiring Nahoun to attend meetings for employees relating to certain regulatory compliance matters that independent contractors did not attend."*fn1
Though Nahoun was paid on a Form 1099 rather than a W-2, "he was paid a set salary (which he was asked to break down into hourly increments for submission to CSFB)."*fn2 Furthermore, according to Nahoun, "the vast majority of CSFB's records" treated him as an employee rather than a private contractor.*fn3

  CSFB terminated Nahoun's employment on March 30, 2004. In the middle of April, Nahoun wrote to the Credit Suisse First Boston Corporation Employee Benefits Committee (the "Committee") seeking confirmation that the Employees' Pension Plan of Credit Suisse First Boston (the "Plan") covered his employment with CSFB from December 16, 1997 through March 30, 2004 (the "Relevant Period"). Subsequently, CSFB informed Nahoun that the Plan did not cover Nahoun during the Relevant Period and purported to deny his appeal from that decision. Neither the Plan nor the Committee responded to Nahoun's request.*fn4

  Nahoun subsequently brought two claims against the Plan and the Committee under the Employee Retirement Income Security Act of 1974, as amended ("ERISA").*fn5 First, he requests the Court to determine de novo that he is entitled to benefits for his work during the Relevant Period under Section 502(a)(1)(B) of ERISA.*fn6 Second, he alleges that the Plan and Committee violated Section 503*fn7 by failing to review his claim.


  In deciding a Rule 12(b)(6) motion, the Court accepts as true all factual allegations in the complaint and draws all reasonable inferences in the plaintiff's favor.*fn8 Where, as here, the complaint refers to a document that is integral to it, the Court considers that document as well.*fn9 Dismissal is inappropriate "unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief."*fn10

  To state claims under ERISA, Nahoun must allege that he was a "participant" within the meaning of the statute.*fn11 ERISA defines "participant" in relevant part to "mean? any employee or former employee of an employer . . . who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer or members of such organization."*fn12 Defendants urge that this implies that an individual, to be a "participant," must be both (1) a common law employee and (2) actually eligible to receive a benefit from the ERISA plan.*fn13 They allege that Nahoun concedes in his complaint that he is not eligible to receive a benefit under CSFB's plan and that his claims therefore fail.*fn14 III.

  The complaint alleges that Nahoun is covered. Defendants provide the Court with two versions of the Plan on this motion, that in effect as of January 1, 1998 ("1998 Plan")*fn15 and an amendment and restatement effective January 1, 2004 ("2004 Plan").*fn16 Both define "participants" as "Employee[s] participating in the Plan."*fn17 The term "Employee" is defined in the 1998 Plan to


"mean any person employed by the Corporation or a Participating Affiliate and treated as such on the books and records of the Corporation or Participating Affiliate, and shall not include (i) any person treated by the Corporation or Participating Affiliate as an independent contractor or (ii) any person serving the Corporation or Participating Affiliate through an agency, consulting firm, payroll service, sub-contractor or other third party provider."*fn18
The 2004 definition is identical in all material respects.*fn19

  Defendants argue that Nahoun was not an "employee" within the meaning of the Plan because CSFB treated Nahoun on its books and records as an independent contractor rather than an employee. Accordingly, they argue Nahoun was not a "participant" within the meaning of ERISA.*fn20 Defendants' argument is unpersuasive. The term "books and records" is not defined in Article I of the Plan, and it is not clear that the definition of "employee" requires CSFB to treat an individual as an "employee" on all of its books and records for the individual to be covered. Nahoun, moreover, alleges that CSFB treated him as an employee on its books and records. His complaint points to several records specifically, including "records kept for compliance purposes."*fn21 Consequently, it cannot be said with certainty that Nahoun cannot prove at trial that he was treated as an employee in CSFB's books and records.

  Nor is it certain that the Plan's exclusion of those "treated by the Corporation or Participating Affiliate as an independent contractor" applies.*fn22 Nahoun alleges that he was treated as an employee rather than an independent contractor*fn23 and enumerates more than a dozen reasons in support of this conclusion.*fn24

  In response, defendants contend essentially that the exclusion specifically targets those treated as independent contractors on CSFB's books and records, such as Nahoun.*fn25 However, the Plan excludes those "treated" as independent contractors, not those "treated on the books and records" of CSFB as independent contractors.*fn26

  While it seems unlikely, the Court cannot now say that Nahoun could prove no facts that would permit a finding that he was a Plan "participant." Accordingly, this branch of defendants' motion lacks merit.


  Defendants argue also that Nahoun's Section 502*fn27 claim is time-barred. They contend the suit was brought over six years after Nahoun had clear notice that he was not a Plan "participant" because, according to them, the Plan itself unambiguously notified Nahoun of his exclusion.*fn28 Defendants rely principally on Downes v. J.P. Morgan Chase & Co.*fn29 In Downes, plaintiff unsuccessfully brought an action for denied benefits under ERISA alleging she had been "wrongfully classified . . . as an independent contractor rather than as an employee" and that her employer denied her benefits "on that basis."*fn30 Downes, however, is inapposite. Unlike the plaintiff in Downes, Nahoun alleges that he always has been a Plan "participant," not that he had been wrongly classified. According to Nahoun, CSFB, the Plan, and the Committee incorrectly denied him benefits due under the plan after he left CSFB.*fn31 Ultimately, defendants' statute of limitations argument is without merit. If Nahoun's employment during the Relevant Period was covered by the Plan, then the claim would not be time-barred. In that event, the denial would have occurred no earlier than 2004, when CSFB told Nahoun that the Plan did not cover him. If, on the other hand, Nahoun is not a "participant," he cannot recover in any event. The statute of limitations is therefore immaterial.


  Defendants' motion to dismiss the complaint for failure to state a claim is denied.


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