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Merkent v. SI Bank & Trust Spring 2004 Severance Benefit Plan

April 5, 2006

EILEEN MERKENT, PLAINTIFF,
v.
SI BANK & TRUST SPRING 2004 SEVERANCE BENEFIT PLAN DEFENDANT.



The opinion of the court was delivered by: Joseph F. Bianco, District Judge

MEMORANDUM AND ORDER

The plaintiff, Eileen Merkent, filed suit against the defendant, SI Bank & Trust Spring 2004 Severance Benefit Plan, for relief under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001, et seq. The defendant moves for judgment on the pleadings, pursuant to FED. R. CIV. P. 12(c). Because the plaintiff failed to exhaust administrative remedies, and because her common law contract claim is barred by ERISA preemption, the Court dismisses the complaint without prejudice.

I. BACKGROUND

Merkent was formerly employed by SI Bank & Trust, which merged with Independence Community Bank ("ICB") in 2004. (Compl. ¶¶ 6-7.) In April of 2004, the merged entity announced its intention to reduce its work force, and circulated documentation which explained a severance benefits plan, entitled the "SI Bank & Trust Spring 2004 Severance Benefits Plan" (hereinafter referred to as "the Plan"). The Plan was designed to give benefits to employees whose employment was not continued by the merged entity. (Pl. Ex. G ¶ 1.)*fn1 In order to be eligible, an employee had to have been involuntarily terminated, other than for cause, prior to the earlier of April 30, 2004 or the day upon which the merger between the entities became effective. (Id. §§ 2.3, 2.10, 3.1(a).) The Plan also outlined certain conditions under which an employee would not be eligible for benefits under the Plan, including the circumstance where the employee:

Resigned or was terminated after declining to accept, an offer of, or a transfer to, a comparable position with ICB or one of its subsidiaries or another company which acquires, is acquired by or merges with ICB, or a company with is providing services to ICB pursuant to an independent contract, with no significant reduction in his or her relative employment status or rate of total compensation, unless the location of the job is substantially different from the Covered Employee's then current job and creates an undue hardship on the employee, as determined by the Administrator.

(Id. § 3.2.1(c).) The Plan also detailed procedures by which an employee could appeal the denial of his or her benefits, under Section 11:

If an employee's claim is denied, the employee (or his or her duly authorized representative) may apply in writing to the Administrator for a review of the decision denying the claim. The employee (or representative) then will have the right to review pertinent documents and to submit issues and comments in writing. The Administrator will provide written notice of his or her decision on review within 60 days after he or she receives a review request. If special circumstances require an extension of time (up to 60 days), written notice of the extension will be given to the employee within the initial 60-day period.

(Id. § 11.)

As a result of the merger, plaintiff was notified that she was going to be moved to a new position within the merged entity. (Compl. ¶ 8.) According to the complaint, plaintiff rejected the job offer because she did not feel that it was comparable to her previous position. (Id. ¶ 12.) Plaintiff was given a Termination Agreement, entitled the "Termination Agreement Containing a General Release and Waiver," which outlined a severance package and was open for acceptance up until and including May 24, 2004. (Id. ¶ 11.) The plaintiff did not accept the offer by April 12, 2004, when she was advised by an agent of the defendant that the Termination Agreement was being revoked because the plaintiff was "not eligible for severance benefits." (Id. ¶ 14.) Plaintiff received written confirmation of the revocation by letter dated April 13, 2004, which notified her that she was deemed ineligible due to the Plan's exclusion under Section 3.2.1(c). (Id. ¶ 15.)

The plaintiff subsequently filed the instant action alleging a violation of ERISA, on the ground that the defendant's unlawful conduct deprived her of severance benefits to which she was entitled under the Plan. (Id. ¶¶ 20-23.) The lawsuit also contains a cause of action for breach of implied contract. (Id. ¶¶ 24-25.)

II. STANDARD OF REVIEW

A motion for judgment on the pleadings, pursuant to FED. R. CIV. P. 12(c) is evaluated under the same standard as a FED. R. CIV. P. 12(b)(6) motion to dismiss for failure to state a claim. See Nicholas v. Goord, 430 F.3d 652, 658 n.8 (2d Cir. 2005). In reviewing a motion to dismiss pursuant to Rule 12(b)(6), the court must accept the factual allegations set forth in the complaint as true, and draw all reasonable inferences in favor of the plaintiff. See Nechis v. Oxford Health Plans, Inc., 421 F.3d 96, 100 (2d Cir. 2005). Dismissal is warranted only if it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief. See Weixel v. Bd. of Educ. of the City of N.Y., 287 F.3d 138, 145 (2d Cir. 2002) (quoting Conley v. Gibson, 355 U.S. 41, 45-46 (1957)). The appropriate inquiry is "not whether a plaintiff will ultimately prevail, but whether the claimant is entitled to offer evidence to support the claims." Twombly v. Bell Atlantic Corp., 425 F.3d 99, 106 (2d Cir. 2005).

III. DISCUSSION

The defendant has moved for judgment on the pleadings, pursuant to FED. R. CIV. P. 12(c). The Court examines its arguments with respect to each of ...


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