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BUNNION v. CONSOLIDATED RAIL CORP.
March 23, 1999
JOHN J. BUNNION, JR., ET AL., INDIVIDUALLY AND ON BEHALF OF ALL OTHERS SIMILARLY SITUATED
v.
CONSOLIDATED RAIL CORP., ET AL.
The opinion of the court was delivered by: Bartle, District Judge.
This is a class action lawsuit under the Employee Retirement
Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. The
plaintiffs, former employees of the defendant, Consolidated Rail
Corporation ("Conrail"), challenge the legality of certain
actions Conrail took with respect to its employee pension plan,
and more specifically with respect to its voluntary separation
program, which the plaintiffs accepted in 1996.*fn1 There are
also age discrimination and pendant state law claims. Presently
before the court are plaintiffs' motion for summary judgment as
to Counts II and XIV, defendants' motions for summary judgment as
to all Counts,*fn2 and defendants' motion for additional
discovery pursuant to Rule 56(f) of the Federal Rules of Civil
Procedure.
After granting in part and denying in part successive motions
to dismiss the complaint and amended complaint, we certified a
plaintiff class of "all persons formerly employed by Conrail at
any Conrail location who separated from Conrail as part of the
March 1, 1996 Conrail Voluntary Separation Program" with respect
to the ERISA claims in Counts I, II, III, and VI and the fraud
claims in Count IV, the negligent misrepresentation claim in
Count V, and the estoppel claim in Count XIV. Bunnion v.
Consolidated Rail Corp., No. CIV. A. 97-4877, 1998 WL 372644
(E.D.Pa. May 14, 1998); see also Bunnion (E.D.Pa. May 18,
1998); Bunnion, (E.D.Pa. March 23, 1998); Bunnion, 1998 WL
32715 (E.D.Pa. Jan. 6, 1998). We also certified one subclass of
"those VSP participants who returned to work for Conrail in
positions of employment which Conrail designated as non-employee
status" with respect to the ERISA claims in Counts VIII, IX, and
XIII, and another subclass of "those class members over 40 years
of age who were returned to work into non-employee status" with
respect to the age discrimination claim in Count VII. Bunnion,
1998). WL 372644 (E.D.Pa. May 14, 1998).
We may grant summary judgment only if there is no genuine issue
of material fact and the moving party is entitled to summary
judgment as a matter of law. See Fed.R.Civ.P. 56(c); Celotex
Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d
265 (1986). We review all evidence and make all reasonable
inferences from the evidence in the light most favorable to the
non-movant. See Wicker v. Consolidated Rail Corp.,
142 F.3d 690, 696 (3d Cir.), cert. denied, 525 U.S. 1012, 119 S.Ct. 530,
142 L.Ed.2d 440 (1998).*fn3
The following facts are undisputed. Conrail maintained a
benefit plan for its employees known as the Matched Savings
Plan/Employee Stock Ownership Plan ("MSP/ESOP"). The MSP/ESOP was
comprised of both an Employee Stock Ownership Plan ("ESOP") and a
"cash or deferred arrangement within the meaning of Code section
401(k)." Conrail Matched Savings Plan, Introduction. We
previously described this plan in our decision in Bennett v.
Conrail Matched Sav. Plan Admin. Comm., Nos. CIV. A. 97-4535,
97-5017, 97-5345, 1997 WL 700538 (E.D.Pa. Oct. 30, 1997),
aff'd, 168 F.3d 671 (3d Cir. 1999). The plan is governed by
ERISA, 29 U.S.C. § 1001 et seq., and is a "defined
contribution plan," also known as an "individual account plan."
29 U.S.C. § 1002(34). Such a pension plan "provides for an
individual account for each participant and for benefits based
solely upon the amount contributed to the participant's account,
and any income, expenses, gains and losses, and any forfeitures
of accounts of other participants which may be allocated to such
participant's account." Id. Under the terms of Conrail's
MSP/ESOP, upon termination of employment or retirement,
disability, death, or certain financial hardships, an individual
was entitled to distributions of up to the total amount which had
been allocated to his or her individual account.
The balance in each individual's MSP/ESOP account included the
amount the individual contributed from his or her own earnings
plus matching contributions of up to 100% of the individual's
annual contribution.*fn4 The source of the matching funds was a
combination of direct contributions from Conrail and its
"participating affiliates" and stock released from the MSP/ESOP
"Unallocated Stock Account." Conrail Matched Savings Plan, §§
4.1, 4.4. The MSP/ESOP could borrow money in order to purchase
certain Conrail securities. The stock acquired with the borrowed
funds was kept in the Unallocated Stock Account, which was
separate from the individual participants' accounts. Each year, a
portion of the stock in this account was to be released for
allocation to participants' accounts. See id. at § 7.2. Any
remainder built up in the Unallocated Stock Account.
In the mid-1990's, Conrail management began to do annual
studies to compare the company, its functions, and its level of
efficiency to other railroads throughout the nation. These
studies also explored whether Conrail should change any of its
operations. As a result, Conrail decided it needed to reduce its
expenses by $30-60 million dollars. On February 21, 1996, the
President and CEO of Conrail, David LeVan, wrote to the company's
employees, "Conrail is announcing early retirement and voluntary
separation programs that we hope will reduce our non-agreement
workforce by 900 employees by 1998. . . . [W]e are seeking first
to reduce our non-agreement workforce though voluntary programs
that provide a transition into retirement or another career." An
e-mail entitled "Conrail Newswire, Special Edition" disseminated
later that same day told employees, "If the 900-position goal is
not achieved through the voluntary programs, Conrail expects to
achieve the additional
reductions through non-voluntary separation programs."
In early March, 1996, Conrail distributed written materials to
eligible employees to explain the voluntary separation program
("VSP"). Included was a March 1 letter from the Assistant Vice
President of Compensation and Benefits, which stated, "As Dave
LeVan told all of us in his announcement on February 21st,
Conrail intends to reduce its non-agreement workforce by
approximately 900 people over the next couple of years." The
letter announced that the process Conrail would use to reach the
900-person reduction goal was comprised of four components. The
first two, which Conrail would offer concurrently, were the VSP
and the Voluntary Retirement Program. The other two components,
to be offered concurrently and "as deemed necessary by management
after completion of the voluntary offerings," were an
"Involuntary Staff Rationalization," and a "Workforce
Redeployment Program." While these components were not explained
in detail in the record, they involved mandatory terminations and
reassignments.
The VSP was generally open to all non-union employees who had
completed fifteen or more years of Conrail service. It provided
for a separation payment of at least two years' salary,*fn5 an
expense allowance of $5,000, and in some instances a relocation
allowance. Eligible employees interested in participating in the
VSP were required to submit an application, including a signed
"general release." The deadline for doing so was April 23, 1996.
The VSP plan description materials provided that an employee
could unilaterally revoke his or her application during the seven
days after it was submitted. While Conrail reserved the right to
accept or reject each application, it had to notify by April 29,
1996 all employees whose applications had been rejected. Conrail
also reserved the right to delay an accepted applicant's
termination date until, at the latest, April 30, 1997. Unless
they received a directive from Conrail about a delayed
termination date, accepted applicants were terminated effective
April 30, 1996. After acceptance into the VSP but the before the
employee's termination date, the employee could rescind
participation in the VSP, but only if it was agreeable to
Conrail.
Conrail held informational meetings to explain the VSP program
to eligible employees. At these meetings, attendees were given
the opportunity to ask questions. Conrail also made use of a
"SepINFO bulletin board," an e-mail distribution system, to
disseminate information about the VSP and to allow employees to
ask questions. None of the parties has explained how the SepINFO
bulletin board worked or how many Conrail employees had access to
it.
On March 8, 1996, at a general VSP informational meeting with
approximately 100 people in attendance, a Conrail employee asked
what effect VSP participation would have on one's right to share
in any distribution of the unallocated ESOP surplus if the
MSP/ESOP should happen to be terminated. The Director of
Compensation and Benefits, who was also a plan administrator for
the MSP/ESOP, told the questioner and the audience she did not
know the answer but would obtain it. On March 19, the Director
distributed an e-mail message to employees via the SepINFO
Bulletin Board in the form of a question and answer. That e-mail
provided:
The following are answers to the questions that have
been asked at the VRP/VSP meetings that have been
held across the system over the last couple weeks:. .
Q) In the unlikely event that the Conrail Matched
Savings Plan/ESOP were to be terminated in the
future, how would the undistributed shares be
allocated?
A) The Conrail Treasury Department advises that the
undistributed shares would first be used to pay off
the loan that purchased the ESOP shares originally.
If there were remaining undistributed shares, one of
the alternatives would be to give a prorated
allocation to all participants (anyone who has an
account balance in the Plan at the time of the
distribution.)
Each of the plaintiffs applied for and was accepted into the
VSP. Because Conrail delayed the termination of some of the
plaintiffs, their last dates as employees varied. Some of the
plaintiffs, after their termination dates passed, returned to
work in what Conrail designated as "independent contractor" or
"leased" employee positions. In this new status, they did not
receive the fringe benefits to which regular, full-time Conrail
employees were entitled. Certain of those individual performed
the same duties as they performed prior to their VSP termination
dates.
Months after the April 30 VSP deadline passed, Norfolk Southern
Corporation and CSX Corporation agreed to acquire Conrail. A new
entity formed by these two companies made a successful tender
offer in the spring of 1997 for Conrail's outstanding stock. See
Bennett, 1997 WL 700538, at *2. Effective June 2, 1997, the
jointly owned company merged with Conrail. See id. Shortly
before, on May 20, 1997, Conrail "terminated" the MSP/ESOP,
effective May 22.*fn6 Conrail then amended the plan on July 15,
1997, to provide for allocation of its unallocated assets.
Individuals remained entitled to distributions of all amounts
credited to their accounts. Stock held in the Unallocated Stock
Account was converted to cash, and a method of allocating that
surplus to individual accounts was established. The cash proceeds
were to be dispersed first to satisfy all outstanding ESOP loans
and then to make any matching contributions required up until
April 30, 1997. What remained was to be allocated to individual
accounts based on employees' earnings, as defined in the plan,
for the years 1996, 1997, and for each subsequent year until the
account was depleted. Earnings, for the purpose of these
calculations, excluded any amounts earned as "independent
contractors" or "leased" employees.
Plaintiffs contend that $539 million of unallocated assets were
left over after the plan's loans were satisfied. Because none of
the plaintiffs was discharged earlier than April 30, 1996,
presumably they received a portion of the allocations of the
MSP/ESOP surplus based upon at least four months of 1996 income.
Those plaintiffs whose termination was delayed remained regular
status Conrail employees for a longer period. Accordingly, they
received allocations from the MSP/ESOP surplus based on more than
four months of 1996 income and, in some instances, on income up
until April 30, 1997. Plaintiffs assert, however, that because
Conrail violated ERISA and other federal and state laws in
securing their participation in the VSP, they did not receive the
full amount of surplus to which they were entitled. They aver
that they have lost collectively over $49 million in MSP/ESOP
allocations.
Intending to be legally bound, I hereby release and
discharge CONRAIL, its subsidiaries, affiliates, and
its and their officers, employees, directors, agents,
and its and their respective successors and assigns,
heirs, executors and administrators (hereinafter
referred to as "Releasees") from any and all claims,
liabilities, charges, obligations, promises,
agreements, controversies, damages, expenses, causes
of action, suits, debts, and demands of any nature,
known or unknown, which I . . . may have against
CONRAIL or any of the Releasees from all time up to
the date on which I have signed this General Release.
This General Release includes, but without
limitation, any and all claims relating in any way to
my employment by CONRAIL and my participation in the
Voluntary Separation Program. . . .
We recently discussed this same release in Buxton v.
Consolidated Rail Corp., Civ. A. No. 98-2409, 1999 WL 46610, at
*3 (E.D.Pa. Jan. 6, 1999). As explained in Buxton, the release
bars all claims the employee may have had "from all time up to
the date on which . . . [he or she] signed this General Release."
(emphasis added). Although the second sentence may appear to bar
"all claims relating in any way" to the VSP, when the first and
second sentences are read together, it is clear that the second
sentence is merely an illustration of the types of claims
included within the first sentence. "[U]nder Pennsylvania law it
is well settled that `releases are strictly construed so as not
to bar the enforcement of a claim which had not accrued at the
date of the execution of the release.'" Youngren v. Presque Isle
Orthopedic Group, Inc., 876 F. Supp. 76, 79 (W.D.Pa. 1995)
(quoting Vaughn v. Didizian, 436 Pa. Super. 436, 648 A.2d 38, 40
(1994)). Thus, the only claims barred by the plain language of
the release are those which accrued before the plaintiffs signed
the releases.
The defendants, who bear the burden of establishing that the
releases bar plaintiffs' claims, have not come forward with any
evidence indicating when any of the plaintiffs signed the
releases. The application materials were distributed to employees
in early March, 1996. Therefore, it is possible that plaintiffs
could have signed the releases at any time between early March
and April 23. Construing the evidence in favor of the
non-movants, we will assume plaintiffs executed their releases on
March 1. As to those claims that challenge actions which took
place after March 1, 1996, defendants have not established as a
matter of law that they are entitled to judgment. Nor have
defendants convinced us that any of the claims accrued before
that date. See id. Defendants,' motion for summary judgment on
Counts I, II, III, IV, V, VI, XII, and XIV on the ground that
they are barred by signed releases will be denied.
Count II of plaintiffs' amended complaint, on which both sides
seek summary judgment, is a claim that defendants breached the
fiduciary duties imposed by ERISA § 404(a), 29 U.S.C. § 1104(a).
ERISA is a comprehensive framework enacted "to promote the
interests of employees and their beneficiaries in employee
benefit plans." Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 90,
103 S.Ct. 2890, 77 L.Ed.2d 490 (1983). ERISA § 404(a) requires
the fiduciary of a plan governed by ERISA to "discharge his
duties with respect to a plan solely in the interest of the
participants and beneficiaries . . . [and] with the care, skill,
prudence, and diligence . . . that a prudent man acting in a like
capacity . . . would use." 29 U.S.C. § 1104(a)(1).*fn8 A
fiduciary breaches these
obligations if it makes affirmative material misrepresentations
to plan participants or beneficiaries about the terms of the
plan. See In re Unisys Corp. Retiree Medical Benefit ERISA
Litig., 57 F.3d 1255, 1264 (3d Cir. 1995); Curcio v. John
Hancock Mut. Life Ins. Co., 33 F.3d 226, 238 (3d Cir. 1994);
Fischer v. Philadelphia Elec. Co., 994 F.2d 130, 135 (3d Cir.
1993). "Put simply, when a plan administrator speaks, it must
speak truthfully." Fischer, 994 F.2d at 135. A fiduciary may
also breach its duties if it fails to provide material
information to plan participants or beneficiaries when it knows
its silence might cause them harm. See Unisys, 57 F.3d at 1264;
Bixler v. Central Pennsylvania Teamsters Health & Welfare Fund,
12 F.3d 1292, 1300 (3d Cir. 1993). In order to prove a claim of
breach of fiduciary duty, plaintiffs must establish four
elements: (1) the defendants' fiduciary status; (2) material
misrepresentations; (3) defendants' knowledge of the confusion
among beneficiaries; and (4) resulting harm to plaintiffs. See
Unisys, 57 F.3d at 1265; Fischer, 994 F.2d at 135.
Plaintiffs first maintain that some of the defendants breached
their fiduciary duties by misrepresenting that Conrail intended
to eliminate 900 jobs and that if a sufficient number did not
chose to participate in the VSP, Conrail would achieve its goal
through involuntary discharges. This alleged misrepresentation
was intended, according to plaintiffs, to induce employees to
accept the VSP out of fear of involuntary termination with fewer
accompanying severance benefits. As it turned out, Conrail never
resorted to involuntary terminations, and no evidence exists that
they were necessary in light of the number of those who elected
the VSP. Nonetheless, plaintiffs maintain that despite Conrail's
statements to the contrary, it never intended to eliminate 900
employees unless it could do so through voluntary means.
The statements to which plaintiffs refer include President
LeVan's February 21, 1996 announcement, the news bulletin posted
on Conrail's SepINFO bulletin board the same day,*fn9 and the
March 1 letter that accompanied the VSP informational materials.
However, there is no evidence that these statements which warned
of involuntary terminations were anything but honest declarations
of Conrail's present intent to do a future act if a precondition
(900 reductions via the voluntary programs) did not occur. Even
if the voluntary programs cut less than 900 employees, a later
decision by Conrail not to resort to the involuntary separations
does not raise a genuine issue of material fact that the earlier
declarations were misrepresentations. Cf. Frahm v. Equitable
Life Assurance Soc'y, 137 F.3d 955, 961 (7th Cir.) (Easterbrook,
J.), cert. denied, 525 U.S. 817, 119 S.Ct. 55, 142 L.Ed.2d 43
(1998).
In further support of their claim that Conrail falsely
threatened involuntary terminations, plaintiffs maintain that,
during March and April, 1996, defendants misrepresented to some
of the individual plaintiffs that the facilities and departments
in which they worked were in danger of closure. For example,
plaintiff Frances Bronson testified at her deposition that during
a meeting held at the Island Avenue facility, she heard from an
unidentified source "the Island Avenue might be closed. . . .
[t]hat the building would close, would probably not be there in
January of 1997." (emphases added). Then, there is plaintiff John
Hollner. He attended a meeting with Mr. Poff and Mr. McCarthy,
whose positions at Conrail have not been identified. According to
Hollner, the two men "indirectly" encouraged him to participate
in the VSP because "they figured that I would possibly be out
of a job in a year's time." (emphasis added). Class
representative John Bunnion testified at his deposition that he
"heard from Andrew Mancini that Vice President Passa said that
the Island Avenue facility would be closed if Conrail did not get
enough people to participate in the voluntary separation."*fn11
Bunnion also recounted that he discussed with Mr. Schimmel,
Conrail's Secretary and Assistant Vice President, his concern
about the closure of Island Avenue. According to Bunnion,
Schimmel then made a phone call to Senior Vice President Jim
McKelvey, after which he told Bunnion, "I'd advise you to apply
for the VSP because of what I just heard from McKelvey because
there will be mass layoffs, and what Passa told Mancini was
probably true." (emphasis added).
There is no indication that these statements about what "might"
or what "possibly" or "probably" could happen were untrue when
made. Moreover, the only evidence that plaintiffs have presented
to show that these were misrepresentations is the fact that the
facilities or departments in question were not ultimately closed.
Plaintiffs' argument with respect to these statements fails for
the same reasons as noted earlier. Merely because the facilities
and departments continued to operate, without more, does not
raise a genuine issue of material fact that the earlier
statements were false at the time they were made. Cf. Frahm,
137 F.3d at 961.
The following are answers to the questions that have
been asked at the VRP/VSP meetings that have been
held across the system over the last couple weeks:. .
Q) In the unlikely event that the Conrail Matched
Savings Plan/ESOP were to be terminated in the
future, how would the undistributed shares be
allocated?
A) The Conrail Treasury Department advises that the
undistributed shares would first be used to pay off
the loan that purchased the ESOP shares originally.
If there were remaining undistributed shares, one of
the alternatives would be to give a prorated
allocation to all participants (anyone who has an
account balance in the Plan at the time of the
distribution.)
As we stated previously, plaintiffs have not directed us to
anything in the record as to who had access to the SepINFO
bulletin board system and who read this message. For the purposes
of our discussion, however, we will assume that this e-mail was
read by a wide audience.
As a starting point, we must emphasize that there is absolutely
no evidence before us that Conrail had given any consideration
whatsoever, on or before the April 23, 1996 VSP application
deadline, to terminating the plan. Conrail stated in the question
framed in the e-mail that termination of the MSP/ESOP was an
"unlikely event." At the time, that was true. Plaintiffs argue,
however, that the defendant spoke falsely when it said "one of
the alternatives" would be to distribute any unallocated surplus
to "all participants (anyone who has an account balance in the
Plan at the time of the distribution.)." Again, plaintiffs have
produced no facts to support their contention.
Plaintiffs direct our attention to Article II of the MSP/ESOP,
which reads, "A Participant shall cease to participate in the
Plan as of . . . the first day in which his employment with
Conrail and Participating Affiliates ceases . . ." They claim
that this provision shows that terminated employees, even those
with account balances, could not be participants and thus could
not share in allocations of the surplus. Plaintiffs fail to note,
however, that the MSP/ESOP provided that the group of those
treated as participants is broader than the group defined in
Article II:
"Participant" means an Employee participating in
the Plan in accordance with Article II. Except for
purposes of Articles III and IV, and except as
otherwise provided in Article IX, an Employee not
participating in the Plan in accordance with Article
II shall continue to be treated as a Participant
until all benefits due him under the Plan have been
paid.
The second sentence of this definition states that someone whose
Conrail employment had been terminated but who maintained a
balance in their MSP/ESOP account after termination would
"continue to be treated as a Participant" until he or she had
withdrawn his or her total individual account balance. Therefore,
consistent with the March 19 e-mail, it was possible that such
individuals would be treated as participants for the purpose of
allocating the unallocated surplus if the plan were to be
terminated.
The MSP/ESOP also contained an unambiguous right-to-amend
clause which permitted Conrail's board of directors to amend the
plan "at any time and in any manner, without prior notification,
consultation, or bargaining with any Employee or representative
of Employees." Conrail Matched Savings Plan, § 14.1. An ERISA
defined contribution plan, such as the MSP/ESOP, "provides . . .
for benefits
based solely upon the amount contributed to the participant's
account." 29 U.S.C. § 1002(34). The plaintiffs here are not
arguing that they have not received or will not receive all of
what was allocated to their individual accounts. As for the
unallocated surplus, we previously concluded and the Court of
Appeals agreed that it was a plan asset, and individual
participants did not have any entitlement to it under ERISA. See
Bennett, 1997 WL 700538, at *5; Bennett, 168 F.3d at 676-78.
"Unallocated assets are not the same as accrued benefits. ERISA
protects only anticipated benefits, not surplus assets."
Bennett, 168 F.3d at 676. Regardless of how the plan defined
participants in March and April, 1996, Conrail could amend the
plan to dispose of the surplus by allocating it to a different
class of "participants" or, for that matter, to no participants
at all. In short, Conrail had at its disposal at that time a
potentially infinite number of options for disposing of the
unallocated surplus, including the one mentioned in the March 19,
1996 e-mail.
Plaintiffs contend that defendants admitted liability for
breach of fiduciary duty. In their memorandum in opposition to
plaintiffs' motion, defendants wrote, "There was absolutely no
provision in the then-existing version of the Matched Savings
Plan [as of March 1996] for the allocation of surplus ESOP
assets. . . . That allocation could only have been accomplished
by plan amendment." Plaintiffs' argument is off the mark. The
March 19 e-mail spoke about possible future events. The fact that
the plan in effect on March 19 did not have a clause regarding
allocation of the plan's surplus upon termination does not bear
on the accuracy of the e-mail's statement about what might happen
in the future if Conrail decided to terminate the plan.
Plaintiffs further argue that Conrail admitted liability when
its benefits attorney testified at his deposition, "The plan [in
effect on March 19, 1996] states that once you cease employment
you cease participation in the plan, so I don't think someone who
left under the . . . VSP would be a participant. . . . [S]ince
they would not still be considered participants they would not be
entitled to an allocation." (emphasis added). Plaintiffs have
cited no case law to advance their position that the deposition
testimony of an inside attorney of Conrail at his level binds it
for purposes of this litigation. In any event, regardless of
whether he was correct about who was a participant, the
attorney's salient point was that those who accepted the VSP were
not "entitled" to an allocation of the unallocated surplus at the
time of their termination. About this he was correct, but this
does not advance the ball for plaintiffs because the e-mail did
not speak of entitlement. It spoke only of potential future
occurrences and options. There was nothing in the terms of the
plan in effect on March 19 which precluded Conrail, in the event
of plan termination, from allocating the surplus to those
employees who had elected the VSP. The attorney said nothing to
the contrary.
In summary, the March 19 e-mail clearly spoke about plan
termination as an "unlikely event." It is undisputed that this
was accurate at the time it was sent. The e-mail explained that
the unallocated surplus would first be used to pay off the ESOP
loans. This was also accurate. Even if termination occurred and
unallocated surplus existed at that time, Conrail did not falsely
promise in the e-mail that VSP participants would share in it.
Conrail simply said it was one of any number of options that
Conrail might elect. Again, there is nothing inaccurate about
this.
In order to make out an ERISA claim for breach of fiduciary
duty under § 404(a), plaintiff must be able to establish that any
misrepresentation was material. See Unisys, 57 F.3d at 1264;
Curcio, 33 F.3d at 238; Fischer, 994 F.2d at 135. "[A]
misrepresentation is material if there is a substantial
likelihood that it would mislead a reasonable employee in making
an adequately informed decision about if
and when to retire." Fischer, 994 F.2d at 135. Summary judgment
based on the issue of materiality is appropriate "only if
`reasonable minds cannot differ.'" Id. (quoting TSC Indus.,
Inc. v. Northway, Inc., 426 U.S. 438, 450, 96 S.Ct. 2126, 48
L.Ed.2d 757 (1976)).
Even assuming that the March 19 e-mail was somehow inaccurate
about whether those accepted into the VSP continued to be
participants, any inaccuracy was not material. The question that
was presented in the March 19 e-mail asked Conrail to make a
prediction about what might happen if a presently unplanned event
(plan termination) occurred under circumstances in which the plan
had an unallocated surplus. "ERISA does not impose a `duty of
clairvoyance' on fiduciaries. . . . An ERISA fiduciary is under
no obligation to offer precise predictions about future changes
to its plan." Fischer, 994 F.2d at 135 (quoting Berlin v.
Michigan Bell Tel. Co., 858 F.2d 1154, 1164 (6th Cir. 1988)).
We cannot be blind to common sense.*fn12 Conrail employees are
real people immediately concerned about providing for themselves
and their families. Like most working individuals, they have
mouths to feed and mortgages or other bills to pay. No reasonable
Conrail employee who faced a decision in March and April, 1996 on
whether to elect the VSP would have considered an unlikely future
event (with no date suggested by which that event might occur)
involving an unknown quantity of money to be a material
consideration in making that decision. The hypothetical and
conditional question and answer in the e-mail could hardly have
misled a reasonable employee ...