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BELLAS v. CBS

June 29, 1999

HARRY BELLAS, PLAINTIFF,
v.
CBS, INC. AND WESTINGHOUSE PENSION PLAN, DEFENDANTS.



The opinion of the court was delivered by: Ambrose, District Judge.

OPINION and ORDER OF COURT

Pending before the Court is the Fed. R.Civ.P. 12(b)(6) Motion to Dismiss of Defendants CBS, Inc. and Westinghouse Pension Plan ("Defendants") as to the Complaint filed against them by Plaintiff Harry Bellas ("Bellas" or "Plaintiff"). Plaintiff's Complaint alleges a violation of ERISA § 204(g), 29 U.S.C. § 1054(g) against both Defendants and a breach of fiduciary duty claim against Defendant CBS, Inc. ("CBS"). For the reasons set forth below, the Defendants' Motion to Dismiss is denied.

STANDARD OF REVIEW

In deciding a motion to dismiss, all factual allegations and all reasonable inferences therefrom must be accepted as true and viewed in the light most favorable to the plaintiff. Colburn v. Upper Darby Township, 838 F.2d 663, 666 (3d Cir. 1988). A court may dismiss a plaintiff's complaint only if it appears beyond doubt that the plaintiff can prove no set of facts in support of his claims which would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). In ruling on a motion to dismiss for failure to state a claim, the court looks to "whether sufficient facts are pleaded to determine that the complaint is not frivolous, and to provide defendants with adequate notice to frame an answer." Colburn, 838 F.2d at 666.

FACTS

Plaintiff alleges that Westinghouse Electric Corporation ("Westinghouse"), the predecessor by name change to Defendant CBS, impermissibly amended the Westinghouse Pension Plan ("the Plan") by first narrowing and then eliminating entirely a "Special Retirement Provision" applicable when a senior employee is terminated as a result of a "Permanent Job Separation." Plaintiff argues that said amendment has the effect of eliminating or reducing an early retirement benefit or an early retirement-type subsidy in contravention of the Retirement Equity Act ("REA") Amendments to ERISA, 29 U.S.C. § 1054(g).*fn1 Plaintiff further claims that in adopting and implementing said amendment, CBS violated its fiduciary duties of acting solely in the interest of plan participants and beneficiaries, of administering the Plan in accordance with both the governing documents and instruments and ERISA, and of exercising care, prudence, and diligence in the performance of its responsibilities.

The Plan provides a Special Retirement Pension for employees of CBS meeting stated age and service requirements who are terminated as a result of a "Permanent Job Separation." Prior to January 1, 1994 ("the pre-1994 version of the Plan"), the term "Permanent Job Separation" was defined in the Plan as meaning "the termination of the employment of an Employee . . . through no fault of his own through lack of work for reasons associated with the business for whom [the employer] determines there is no reasonable expectation of recall." An amendment to the Plan, adopted by CBS on January 1, 1994 ("the Amendment"), altered participants' entitlement to a Special Retirement Pension in two respects: (1) the Amendment made it harder to qualify for a Special Retirement Pension after January 1, 1997, by narrowing the definition of "Permanent Job Separation" to apply only if an employee's employment termination was due to a job movement, product line relocation, or location close-down and (2) the Amendment eliminated the Special Retirement Pension in toto for terminations on or after September 1, 1998.*fn2

Plaintiff was employed by CBS in the nuclear division of CBS until December 31, 1997. He was a participant in the Plan at all relevant times prior thereto, including at the time of the adoption of the Amendment. Plaintiff was not notified of the Amendment until late in 1994 or until distribution of the January 1, 1995 Summary Plan Description ("SPD").

As of January 1, 1997, the effective date of the Amendment's alteration of the meaning of "Permanent Job Separation," Plaintiff was over age 50 and had more than thirty (30) years of Eligibility Service at CBS.

As part of a coordinated layoff directed primarily at employees of senior age, Plaintiff's employment was terminated by CBS on December 31, 1997, through no fault of his own, through lack of work, for reasons associated with CBS's business and with no reasonable expectation of recall.

Upon being laid off, Plaintiff met all of the requirements for a Special Retirement Pension under the pre-1994 version of the Plan.

CBS did not inform Plaintiff of his eligibility for a Special Retirement Pension under the pre-1994 version of the Plan, thereby preventing him from making a claim under the pre-1994 version of the Plan.

Since January 1, 1997, CBS has persisted in denying Special Retirement Pensions to those who, like Plaintiff, have otherwise qualified ...


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