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Trenton v. Scott Paper Co.

argued: September 29, 1987.

JAMES C. TRENTON, SR., FREDERICK A. RINGBLOOM, HARRY G. BARLOW AND EARL L. OWENS, INDIVIDUALLY AND ON BEHALF OF THE CLASS OF EMPLOYEES OF SCOTT PAPER COMPANY EXCLUDED FROM PARTICIPATION IN THE HIGHLY ACCELERATED RETIREMENT PROGRAM, APPELLANTS
v.
SCOTT PAPER COMPANY, AND RETIREMENT BOARD OF SCOTT PAPER COMPANY SALARIED EMPLOYEES RETIREMENT PLAN



Appeal from the United States District Court for the Eastern District of Pennsylvania. D.C. Civil No. 86-2955.

Seitz, Greenberg, and Rosenn, Circuit Judges.

Author: Seitz

Opinion OF THE COURT

SEITZ, Circuit Judge.

I. JURISDICTION AND SCOPE OF REVIEW

Appellants appeal from the order of the district court granting appellees' motion for summary judgment and denying appellants' motion for summary judgment.

The district court had jurisdiction under 29 U.S.C. §§ 216, 1132(e)-(f), 1303, 28 U.S.C. § 1331 (1982), and the doctrine of pendent jurisdiction. We have jurisdiction under 28 U.S.C. § 1291 (1982).

The scope of our review is plenary when reviewing grants of summary judgment. Goodman v. Mead Johnson & Co., 534 F.2d 566, 573 (3d Cir. 1976), cert. denied, 429 U.S. 1038, 50 L. Ed. 2d 748, 97 S. Ct. 732 (1977).

II. FACTS

Appellee Scott Paper Company ("Scott") is the sponsor of a number of employee benefit plans, including the Scott Paper Company Salaried Employees Retirement Plan ("SERP"). Scott also sponsors the Scott Highly Accelerated Retirement Program ("SHARP"), which is the subject of the instant appeal. Of the salaried Scott employees who are eligible for SERP, some employees are also eligible for SHARP. Appellants are the class of salaried employees of appellee Scott who are excluded from SHARP. Appellee Retirement Board of Scott Paper Company Salaried Employees Retirement Plan ("Retirement Board") is the managing board of SERP.

In an effort to provide an incentive to salaried employees at certain designated facilities to retire early and thereby reduce the salaried workforce at those facilities, Scott designed SHARP. The impetus for Scott's action was Scott's determination that those facilities were overstaffed. SHARP was implemented when the Retirement Board amended SERP to provide for the SHARP program in addition to the already-existing SERP plan. A comparison of the workings of SERP and SHARP is necessary to understand appellants' claims. SERP provides for two types of retirement. Under SERP, a salaried employee of Scott can retire with full benefits at age sixty-two or elect early retirement with reduced benefits at any time after reaching the age fifty-five. If an employee elects early retirement under SERP, the employee's pension benefits are reduced by 5 % for each year that the employee is under age sixty-two. The SHARP plan, inter alia, eliminated the 5 % per year penalty and allowed early retirement at age fifty-two. Thus, SHARP provided a far more attractive plan of early retirement than that otherwise available under SERP. SHARP was implemented to encourage early retirement at certain Scott facilities and thereby reduce the workforces at those facilities. Accordingly, SHARP was made available only to salaried employees of those facilities who met its age and service requirements.

Appellants brought an action in the United States District Court for the Eastern District of Pennsylvania. They alleged that the adoption and implementation of SHARP violated their statutory rights under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 301-1461 (1982), and the Age Discrimination in Employment Act ("ADEA"), 29 U.S.C. §§ 621-634 (1982), as well as certain state law rights. The district court granted appellants' motion for class certification and defendants' motion for summary judgment. This appeal followed.

III. THE ERISA ...


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