The opinion of the court was delivered by: MCGLYNN
Plaintiff, William Lucash, an hourly employee at defendant Strick Corporation, (Strick), from August 1958 through May 16, 1975 brought this action against Strick, Amended and Restated Strick Corporation Hourly Rated Pension Plan, (the Pension Plan), the Pension Benefit Guaranty Corporation,
(PBGC), First Pennsylvania Bank, N.A.,
and UAW Local No. 1354 (Local 1354), to recover benefits allegedly due him under the Pension Plan. The Complaint seeks relief under three theories.
Count One of the three count Complaint alleges that the defendants violated plaintiff's right under the Employee Retirement Income Security Act, (ERISA), 29 U.S.C. § 1001, et seq., by (1) depriving him of disability benefits he fully deserved and (2) by failing to inform him of the reasons for the denial and the steps he could have taken to perfect his application. Count Two alleges a violation of § 301 of the Labor Management Relations Act, (LMRA), 29 U.S.C. § 185. Specifically, it is contended that the defendants' actions in depriving plaintiff of his disability benefits violated a succession of collective bargaining agreements. Count Three alleges a state law claim of knowing, intentional or reckless breach of the duty of care, fiduciary duty and/or contractual obligation owed by the defendants to the plaintiff.
Presently pending before the court is Strick's and the Pension Plan's motion for summary judgment, Fed.R.Civ.P. 56, on Counts One and Two of the Complaint and their motion to dismiss Count Three of the Complaint pursuant to Fed.R.Civ.P. 12(b)(6).
As to Counts One and Two of the Complaint, Fed.R.Civ.P. 56(c) provides that summary judgment "shall be rendered forthwith if the pleadings, depositions, answers to interrogatories, and admissions, if any, show that there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." The court, for purposes of determining a summary judgment motion, must view the record in the light most favorable to the party opposing the motion. United States v. Diebold, Inc., 369 U.S. 654, 655, 82 S. Ct. 993, 994, 8 L. Ed. 2d 176 (1962); Smith v. Pittsburgh Gage & Supply Co., 464 F.2d 870, 874 (3d Cir.1972). With this principle in mind, the following facts may be gleaned from the pleadings and exhibits submitted to the court.
During the course of his employment with Strick, plaintiff began to suffer from diseases of the back, heart and digestive system and when plaintiff's employment with Strick was terminated when it closed its Fairless Hills Plant on May 16, 1975, he worked temporarily for two different employers. He was refused permanent employment because of his health. In December of 1976 plaintiff applied to the Social Security Administration, (SSA) for disability benefits. The SSA made a determination that plaintiff was disabled in October of 1975 and, accordingly, awarded him disability benefits retroactive to that date.
In January of 1979 plaintiff applied to Strick for pension benefits under the reinstated pension plan. In support of his application plaintiff submitted the SSA determination that he was disabled as of October 17, 1975. According to § 3.4 of the pension plan, in order to recover, plaintiff must have been suffering from a total and permanent disability which began prior to May 31, 1975. In March of 1979, Strick denied plaintiff's disability benefits application on the grounds that plaintiff failed to submit sufficient medical documentation which demonstrated that he was suffering from a total and permanent disability which began prior to May 31, 1975.
In April of 1979 Local 1354 intervened on plaintiff's behalf and requested a further review of plaintiff's application for disability benefits. Pursuant to that review, plaintiff's doctor, Milton Swartz, M.D., forwarded plaintiff's medical file to Arnold L. Goldstein, M.D. who examined the plaintiff on behalf of Strick in May of 1979 and determined that as of that date plaintiff was unable to be employed. In August of 1979, Strick again denied plaintiff's application for disability benefits because he failed to establish that he was totally and permanently disabled prior to May 31, 1975.
After this second denial, at Local 1354's request, Strick held a hearing on September 4, 1979 where the plaintiff testified that his illnesses had rendered him totally and permanently disabled prior to May 31, 1975. At the hearing Strick requested the plaintiff to have his doctor forward an explanation of plaintiff's physical condition prior to May 31, 1975 to the company. In his response to this request, Strick received a one-line letter from plaintiff's doctor, Milton Swartz, M.D., which stated: "This is to certify that William Lucash has been totally disabled since May 16, 1975".
See Strick's Summary Judgment Exhibit E at 12.
On September 25, 1979 Strick informed plaintiff that the information it had received was insufficient and requested plaintiff to have his doctor forward a detailed explanation of plaintiff's physical condition prior to May 31, 1975. No such explanation was forthcoming and Strick denied plaintiff's application on December 11, 1979 for failure to substantiate his claim of total and permanent disability prior to May 31, 1975.
On February 13, 1980, Strick received a letter from plaintiff's attorney, Jeffrey Reed, informing Strick that he had proof of plaintiff's total disability and would forward such data upon request. In a response dated February 15, 1980 Strick requested Mr. Reed to forward the information for its consideration. Strick never received this information.
The standard of review which the court must apply to Strick's and the Pension Plan's decision to deny plaintiff disability benefits is whether the defendants acted in an arbitrary or capricious manner. The court is not free to substitute its own judgment for that of the defendants in determining eligibility for plan benefits. Rosen v. Hotel and Restaurant Employees & Bartenders Union, 637 F.2d 592, 596 n. 5 (3d Cir.1981), cert. denied, 454 U.S. 898, 102 S. Ct. 398, 70 L. Ed. 2d 213 (1981); Bickel v. Long Term Disability Plan of Western Electric, 541 F. Supp. 685 (E.D.Pa.1982). Under this standard the "scope of review is a narrow one. A reviewing court must consider whether the decision was based on a consideration of the relevant factors and whether there has been a clear error of judgment." Bowman Transportation, Inc. v. Arkansas-Best Freight System, Inc., 419 U.S. 281, 285, 95 S. Ct. 438, 441, 42 L. Ed. 2d 447 (1974). "Review under this standard requires the challenged decision to remain intact unless it is not rational", Federal Communications Commission v. National Citizens Committee for Broadcasting, 436 U.S. 775, 803, 98 S. Ct. 2096, 2116, 56 L. Ed. 2d 697 (1978), or "unwarranted in law or without justification in fact." Goodman v. United States, 518 F.2d 505, 511 (5th Cir.1975).
Application of this standard requires affirmance of defendants' decision to deny plaintiff disability benefits. Defendants' denial was based on plaintiff's repeated failure to offer evidence that he was ...