United States District Court, E.D. New York
For Michael Sullivan, Plaintiff: Ira Newman, LEAD ATTORNEY, Law Office of Ira S. Newman, Great Neck, NY; Ira S. Newman, LEAD ATTORNEY, The Law Offices of Ira S. Newman, Great Neck, NY.
For Local 553 Pension Fund, Board of Trustees of the Local 553 Pension Fund, Defendants: William K. Wolf, LEAD ATTORNEY, Friedman & Wolf New York, NY.
MEMORANDUM & ORDER
PAMELA K. CHEN, United States District Judge.
From 1979 through 2010 Plaintiff Michael Sullivan (" Sullivan" or " Plaintiff" ) was employed as an oil burner mechanic for companies that maintained collective bargaining agreements with Local 553 International Brotherhood of Teamsters (" Local 553" or the " Union" ). Upon his retirement, Plaintiff submitted an application for earned pension benefits to Defendant Local 553 Pension Fund (the " Fund" ). The Fund granted Sullivan's application for credits with two exceptions: (1) 3.25 credits for the years 1979-1982, during which Sullivan was employed by Northside Fuel Corp. (" Northside" ) (" Northside Dispute" ); and (2) .25 credits for a portion of 1999, during which he was employed by Ideal-Quiet Heet Corp. (" Ideal" ) (" Ideal Dispute" ).
Plaintiff initiated this action under the Employee Retirement Income Security Act of 1974 (" ERISA" ), 29 U.S.C. § 1002 (2)(B)(3), to recover the pension benefits denied by the Fund as part of the Northside and Ideal Disputes. Plaintiff now moves for summary judgment with respect to both disputes. Defendants cross-move for summary judgment only as to the Northside Dispute.
The Fund's decisions to deny Plaintiff the Northside and Ideal pension credits should only be overturned if they were " arbitrary and capricious." Because the Fund's decision with respect to the Northside Dispute was not " without reason," the Court DENIES Plaintiff's motion for summary judgment and GRANTS Defendants' motion for summary judgment as to that claim. With respect to the Ideal Dispute, there remain genuine issues of disputed fact as to whether Sullivan worked the required 250 service hours for Ideal in
1999 to earn the .25 pension credits he seeks. Plaintiff's motion for summary judgment as to the Ideal claim is, therefore, DENIED.
I. Relevant Facts
A. The Parties
The Fund is a multi-employer benefit plan that provides pension benefits to covered employees, retirees, and their dependents. (Dkt. 18 (" Def. 56.1" ) ¶ 10; Dkt. 30 (" Pl. 56.1" ) ¶ ¶ 1-2.) The plan was established pursuant to the collective bargaining agreements (" CBAs" ) between Local 553 and various employers. (Def. 56.1 ¶ 10.) The Fund is administered by the Defendant Board of Trustees (the " Trustees" ), which is comprised of representatives from Local 553 and representatives from employers in the fuel oil industry. ( Id.) The Trustees operate the Fund pursuant to the terms of the Local 553 Pension Fund Amended and Restated Trust Agreement (" Trust Agreement" ), the terms of the Pension Regulations for the Local 553 Pension Fund (" Pension Regulations" or " the Plan" ), and the terms of the Summary Plan Description for the Local 553 Pension Fund (" Summary Plan Description" ). (Def. 56.1 ¶ 11.)
Sullivan worked in the fuel oil industry for various companies that maintained CBAs with the Fund. ( Id. ¶ 3.) Based on such work, Plaintiff is a participant in the Fund and receives a pension benefit from the Fund, effective January 1, 2011, in the amount of $1,842.50 per month. ( Id. at ¶ ¶ 2-3, 9.)
Employers that participate in the Fund made pension benefit contributions to the Fund on Sullivan's behalf for each year from 1982 through 2009, with the exception of 1997 and 1998, which are not in dispute. ( Id. ¶ 3.) Sullivan earned credit for each year in which contributions in excess of 250 hours were made on his behalf, for a total of 24.75 credits. ( Id.)
B. Northside Dispute
Sullivan seeks 3.25 pension credits from the Fund based on his work for Northside from 1979-1981. (Pl. 56. 1 ¶ 5.) Defendants concede that Plaintiff has been a participant in the Plan since 1982 (Def. 56.1 ¶ 3), but dispute that he is owed benefits for work prior to 1982. The Fund's records show that no employer paid pension contributions to the Fund for work performed by Sullivan from 1979-1981. ( Id. ¶ 4.)
On April 7, 2011, the Trustees denied Plaintiff's request for retirement benefits for work he performed for Northside during the period from 1979-1981 and a portion of 1982, totaling 3.25 credits. (Pl. 56. 1 ¶ 5.) The denial letter stated, in relevant part: " the Trustees denied your request
for pension credits for 1978, 1979, 1980, 1981, and 1982 based on work you state you performed with [Northside] because Northside was not a signatory to a collective bargaining agreement with Local 553 . . . during the years in question, and was therefore not a contributing employer to the Fund." (Dkt. 29-3.) The letter also stated that Sullivan did not demonstrate that he was working in " Covered Employment" that would substantiate his claim for credits from 1979-1981. ( Id.)
On July 6, 2011, Plaintiff appealed the denial of benefits to the Trustees, requesting 3.25 credits towards his pension for the period of time he was employed at Northside (the " Appeal" ). (Pl. 56. 1 ¶ 8.) In the Appeal, Sullivan admitted that his employment was not included in a " covered" " category of employment" as defined by the Pension Regulations, and " [t]herefore concede[d] that the period of time from 1979 until 1982 when Mr. Sullivan was employed by Northside does not meet the definition of a 'Contribution Period.'" (Dkt. 22-4 at 2.) Sullivan instead argued that he was entitled to pension credit for his work with Northside because after leaving Northside, Sullivan worked in covered employment with Manhattan & Queens Fuel. Corp. (" M & Q" ), and pursuant to Section 1.9 of the Pension Regulations, " [f]or purposes of service prior to the Contribution Period, 'Covered Employment' shall include employment during a period of time immediately preceding when the Employer became so obligated. It shall also include employment by any Employer which was covered by a written agreement with the Union." ( See id. at 3) (emphasis omitted.)
Importantly, as discussed infra, Sullivan conceded that, between his employments with Northside and M & Q, he worked for a brief time with Globe Fuel Oil (" Globe" ), which was not a Local 553 employer. ( Id.) He argued that the intervening work for Globe was irrelevant because " credit is not limited to union employers whose period of employment directly preceded a period when the employee was a union member. Instead, credit is owed to any employee who is employed by a Local 553 shop but is not a union member who at any time subsequent to that period is employed by a Local 553 employer, regardless of whether the two periods of employment are continuous." ( Id.)
Plaintiff appended to the Petition evidence that, in substance, demonstrated that he worked for Northside during the relevant time period and affidavits that confirmed that Northside was a signatory to a CBA with Local 553 during the relevant time period. ( See Sullivan Ex. E.) On October 6, 2011, the Defendants advised Plaintiff, via letter, that they were postponing consideration of his Appeal because the Trustees were " continuing to investigate whether [Northside] was a signatory to a collective bargaining agreement with [Local 553] for the years 1979 through 1982." (Dkt. 29-7.) The letter also noted that that the pay stubs Sullivan " submitted for Northside have pay increases and rates that do not correspond to the rates and pay increases that were in the industry contract for Local 553 employers during the subject time period." ( Id.) Most importantly, the letter stated that, " taking into account your attorneys' concession that you were not working in covered employment during your time at Northside and that you worked for a non-Local 553 employer after leaving Northside, we are investigating whether you are able to receive credit for your work at Northside under the terms of the Plan." ( Id.)
On December 9 2011, the Defendants denied Plaintiff's petition with respect to his period of employment at Northside. (Dkt. 29-8.) The letter cited three bases for the denial: (1) Northside was not a signatory to a collective bargaining agreement with Local 553 " during the years in question, and was therefore not a contributing employer to the Fund" ; (2) " you [Sullivan] have conceded that the work you performed for Northside during the time in question was not work in a category of employment covered by a collective bargaining agreement" ; and (3) " your [sic] worked for an employer that did not contribute to the Fund immediately after your work with Northside and before you began working in Covered Employment for a different employer." ( Id.) As will be discussed, the crux of the instant litigation as to the Northside Dispute is whether the Trustees' denial of Sullivan's application, based on the above three justifications, was arbitrary and capricious.
Records produced by the Defendants during discovery in this case demonstrate that Northside was a signatory to an agreement or collective bargaining agreement with Local 553 during the period Plaintiff was employed at Northside. (Pl. 56. 1 ¶ 33.) Defendants concede this point. (Dkt. 32 (Def. 56. 1 Reply) ¶ 33.) However, the Fund's records demonstrate that Northside did not pay pension contributions to the Fund for work performed by Sullivan from 1978-1982, i.e., Sullivan was not working in " covered employment." (Def. 56.1 ¶ 5.) Moreover, Defendants' records demonstrate that Sullivan did not earn pension ...