The opinion of the court was delivered by: Joseph F. Bianco, District Judge
Plaintiff retirees brought the instant action against their former employer, defendant KeySpan Corporation, under the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1001, et seq., challenging a reduction in their health care benefits. Defendant moves to dismiss the action, pursuant to Fed. R. Civ. P. 12(b)(6). For the reasons stated below, the motion is denied in its entirety.
Defendant KeySpan Corporation ("KeySpan")*fn1 provides medical coverage for certain employees and retirees under an employee benefit plan, entitled the "Managed Care Program-LILCO" (hereinafter "the Plan"). The Plan's documentation includes a reservation of rights clause, which reads:
[The Company] intends to continue the Managed Care Program, but reserves the right, subject to approval by its Board of Directors and contracts to which it is a party, including collective bargaining agreements, to terminate, amend, or modify the Managed Care Program.
(Def.'s Mem. Ex. A at 51.)
In late 1998, KeySpan initiated an early retirement program, called the "Special Retirement Program for Management Employees" ("SRP"). In support of this program, the Company sent a package of materials outlining the early retirement program to selected management employees. One of the documents provided an overview summary of the SRP (hereinafter "SRP Summary").*fn2 The introduction of the SRP Summary informs the recipient that it is intended to provide them with "a detailed explanation of the Program." (Def's Mem. Ex. B at i.) The introduction also indicates that the document should be considered alongside other documents included in the package, including the KeySpan Energy Summary for Health and Life Insurance Plans. (See id.) The introduction concludes by noting that the purpose of the SRP was to help "achieve reductions in the Company's overall staffing levels as part of the Company's commitment to achieve O&M savings to be more competitive in today's business environment." (See id.)
The SRP Summary provides specific information about the retirement benefits that were to be provided to management employees who took advantage of the SRP. (See id. at 10-12.) First, it notes that, although the retiree heath benefits program was normally only provided to employees with at least fifteen years of service, the SRP only required ten years of employment for eligibility. (See id. at 10.) The document indicates that details of the program were explained in an accompanying document, the summary of Retirement Health Care Benefits (hereinafter "Health Care Summary").*fn3 (See id.) Next, the SRP Summary discusses upcoming anticipated changes in retiree health and life insurance:
What Changes are Anticipated for Retiree Health and Life Insurance?
As you consider retirement, you should be aware that we are considering plan modifications to retiree Health and Life Insurance coverage. If you elect to retire during the special program you will not be subject to the changes anticipated and will continue to participate in the retiree benefit plans provided to existing retirees. The changes anticipated are described on the following chart.
(Id.) (emphasis and added emphasis in original). The following page includes a chart entitled "Summary of Benefit Changes Anticipated for Retirees After 1/1/99." (Id. at 11.) The first column is entitled "Benefit Design Under Special Retirement Program," and the second column is entitled "Changes Anticipated for Employees Retiring After 1/1/99." (Id.) One of the rows is entitled "Medical Benefit Plan Changes." (Id.) In that row, the response under the first column, referring to SRP participants, is "None," and the response under the second column, referring to employees retiring after January 1, 1999, is "Medical benefits will be subject to change consistent, with changes made each year to active employee benefits." (Id.) The SRP Summary does not include a reservation of rights clause.
The Health Care Summary provides more detail about health care benefits under the SRP, including information about deductibles, copays, extent of coverage provided, and various exclusions. (Def.'s Mem. Ex. C. at 1-3.) The conclusion of the Health Care Summary includes the following, emphasized in bold text:
The information contained in this Summary of Benefits is for informational purposes only and should not be considered a substitute for Plan documents. Benefits may vary by state. Final interpretation of your rights and benefits under the Plan will be governed by the Plan documents. The Company shall have the ...