The opinion of the court was delivered by: Reed, S.J.
Plaintiff was denied a portion of his accrued pension benefits and
now brings claims under the Employee Retirement Income Security
Act, 29 U.S.C. § 1001, et seq. ("ERISA"), the Labor Management
Reporting and Disclosure Act of 1974, 29 U.S.C. § 401, et. seq.
("LMRDA"), and the Internal Revenue Code,. 26 U.S.C. § 411 and 412.
Now before this Court are the cross-motions of plaintiff Edward J.
Foley, Sr. (Document No. 46), and defendants International
Brotherhood of Electrical Workers Local Union 98 Pension Fund, et.
al., (Document Nos. 44 and 45).
Edward Foley, Sr., was a union member who contributed to the
International Brotherhood of Electrical Workers Local Union No. 98
Pension Fund from 1959-1971. He earned 12.5 years of pension
credits during that time. In 1971, he was fired from employment
covered under the plan (employment in the electrical industry),
and from 1971 to 1981, Foley did not work in covered
employment.*fn1 He claims that he continued to seek employment in
the electrical industry during the 1971-81 by contacting union
offices and members for job references. While Foley was not
involved in covered employment and thus earned no pension credits
from 1971-81, apparently he remained active in union affairs,
voted in union elections, and taught courses for union members
during that time. Foley returned to covered employment in 1981 and
eventually became president of the union and a trustee of the
pension fund. He retired and sought pension benefits in 1996.
The controversy in this case surrounds plaintiff's 1971-81 hiatus
and its effect on the benefits plaintiff had accrued prior to it.
The International Brotherhood of Electrical Workers Local Union
No. 98 Pension Plan ("plan") contains a "break in service"
provision under which accrued pension credits lapse when an
individual fails to work 600 hours in covered employment for a
consecutive two-year period. (Plaintiff's Motion for Partial
Summary Judgment, Ex. A, International Brotherhood of Electrical
Workers Local Union No. 98 Pension Plan, at 3) ("break-in-service
provision"). It is undisputed that Foley failed to work for 600
hours in covered employment for more than two consecutive years
during the 1971-81 period. However, Foley believed he qualified
for an exception to the break-in-service provision, under which an
individual who suffered a break in service may nevertheless
collect pension credits accrued prior to the break in service if
s/he can show that s/he was "continuously available for work
within the jurisdiction of the Union and was unable to obtain
covered employment." (Plaintiff's Motion for Partial Summary
Judgment, Exh. A, International Brotherhood of Electrical Workers
Local Union No. 98 Pension Plan, at 3) ("available-for-work
In 1988, Foley raised his eligibility for the available-for-work
exception to the trustees of the pension fund ("trustees"). The
trustees passed a resolution to "change the pension records of
Foley . . . to reflect that Mr. Foley did not incur a break-in-service
because he met the requirements of the Pension Plan [exception] . . .
which provides a grace period and obviates the Plan's break-in-service
provision." (Plaintiff's Motion for Partial Summary Judgment, Exh. B.
Local 98 Pension Trust Fund, Minutes of the Meeting, Dec. 7, 1988,
at 13). The matter lay dormant until 1995, when union member Fred
Compton,*fn2 who plaintiff claims bore a grudge against
plaintiff,*fn3 began raising questions about whether plaintiff
was entitled to pension benefits for the years before his break
in service. Compton submitted a letter to the pension fund trustees
alleging that plaintiff may have misled them in 1988 about his
availability for work during his break in service. The trustees
reopened the matter and conducted an investigation into the 1988
vote, ultimately concluding that, while plaintiff had not committed
misconduct and had produced sufficient evidence to qualify for the
available-for-work exception for the most of the years during his
break in service (1975-81), he had not proved that he was
available for, but unable to, obtain covered work during the years
1972-74. Thus, the pension plan reversed its 1988 determination
and concluded that plaintiff did not qualify for the
available-for-work exception and was not entitled to credits
accrued from 1959-71. (Plaintiff's Motion for Partial Summary
Judgment, Exh. G, Letter from Trust Fund Counsel Laurance E.
Baccini, Feb. 23, 1995).
The matter again entered a period of dormancy until plaintiff
retired and actually applied for pension benefits in July 26,
1996. While his application was granted for benefits accrued from
1981 to 1996, his application for credits accrued during the years
1959-71 was denied in 1996, as were his appeals. Plaintiff then
brought this action.
Plaintiff asserts claims under ERISA for recovery of benefits
29 U.S.C. § 1132 (a)(1)(B), and equitable relief under 29 U.S.C. § 1132
(a)(3), against the International Brotherhood of Electrical
Workers Local Union 98 Pension Fund ("Pension Fund") and Scott
Ernsberger, and John J. Dougherty, Edward Neilson, Joseph Agresti,
Thomas J. Reilley, Jr., Dennis Link, William C. Rhodes, Roy Dantz,
and Larry Bradley in their capacities as trustees (collectively,
the "Plan Defendants"). He also names as defendants the
International Brotherhood of Electrical Workers Local Union 98
("Union") Dougherty and Nielson in their capacities as union
officers (collectively, the "Union Defendants"). Plaintiff also
asserts claims under the Labor Management Reporting and Disclosure
Act, 29 U.S.C. § 412 ("LMRDA"). The Plan Defendants assert
counterclaims against plaintiff for breach of fiduciary duty under
The Union Defendants (Document No. 44) and the Plan Defendants
(Document No. 45) have each filed motions for summary judgment as
to all of plaintiff's claims. Plaintiff has filed a motion for
partial summary judgment on his ERISA claims (Document No. 46).
The Union Defendants' motion will be granted in full; the Plan
Defendants' motion will be granted in part and denied in part; and
plaintiff's motion will be granted in part and denied in part.
A. Summary Judgment Standard
According to Rule 56(c) of the Federal Rules of Civil Procedure,
"if the pleadings, depositions, answers to interrogatories, and
admissions on file, together with the affidavits, 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," then a motion for summary judgment
must be granted. The question before the Court at the summary
judgment stage is "whether the evidence presents a sufficient
disagreement to require submission to a jury or whether it is
so one-sided that one party must prevail as a matter of law."
See Anderson v. Liberty Lobby, 477 U.S. 242, 251-52, 106 S.Ct. 2505,
2511 (1986). The Court's role at summary judgment is not to weigh
the evidence, but to determine whether there is a genuine issue
for trial; that is, an issue upon which a reasonable jury could
return a verdict in the non-moving party's favor. See id. at 249,
106 S.Ct. at 2511.
The moving party "bears the initial responsibility of informing
the district court of the basis for its motion, and identifying
those portions of `the pleadings, depositions, answers to
interrogatories, and admissions on file, together with the
affidavits, if any,' which it believes demonstrate the absence of
a genuine issue of material fact." Celotex Corp. v. Catrett,
477 U.S. 317, 323, 106 S.Ct. 2548, 2553 (1986). The nonmoving party
must then "go beyond the pleadings and by her own affidavits, or
by the `depositions, answers to interrogatories, and admissions on
file,' designate `specific facts showing that there is a genuine
issue for trial.'" Id. at 324, 106 S.Ct. at 2553.
In deciding whether there is a disputed issue of material fact,
the "inferences to be drawn from the underlying facts . . . must be
viewed in the light most favorable to the party opposing the
motion." Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 587, 106 S.Ct. 1348, 1356 (1986) (quoting United States
v. Diebold, Inc., 369 U.S. 654, 655, 82 S.Ct. 993, 994 (1962)).
On cross-motions for summary judgment, the court must determine
separately on each party's motion whether judgment may be entered
in accordance with the summary judgment standard. See Sobczak v.
JC Penny Life Ins. Co., No. 96-3924, 1997 U.S. Dist. LEXIS 1801
(E.D.Pa. Feb. 14, 1997), aff'd, 129 F.3d 1256 (3d Cir. 1997)
(citing 10A Charles Alan Wright, et al., Federal Practice and
Procedure 2720, at 23-25 (2d ed. 1983)).
Plaintiff asserts claims for recovery of benefits under 1132(a)
(1)(B) and for injunctive relief under 1132(a)(3). In their
motion for summary judgment, defendants assert that plaintiff's
claims are procedurally barred and that they fail on the merits.
Defendants first assert that plaintiff did not appeal the
trustees' denial of his benefits in a timely fashion and thus
failed to exhaust his administrative remedies. Under the plan,
defendants argue, Foley had 60 days to appeal the decision of the
trustees to deny him credits accrued from 1959-71, and his appeal
was received four days after the expiration of the 60-day period.
Having failed to exhaust administrative remedies as required under
ERISA, defendants contend, plaintiff cannot proceed to the merits
of his claim.
The facts regarding the timeliness issue are somewhat convoluted.
Plaintiff submitted his application for pension benefits,
including credits accrued from 1959-71, on July 26, 1996.
(Plaintiff's Motion for Partial Summary Judgment, Exh. L, Pension
Application of Edward J. Foley). On September 4, 1996, the pension
fund notified him that he would receive only the pension credits
accrued from 1981-96, and would not receive credits accrued prior
to his break in service. (Plaintiff's Motion for Partial Summary
Judgment, Exh. M, Letter from Benefits Administrator, Sept. 4,
1996). On November 6, 1996, plaintiff filed what he believed was
an appeal of the decision to deny him credits accrued from 1959-71
due to the break-in-service provision. (Plaintiff's Motion for
Judgment, Exh. N, Letter from Edward J. Foley, Nov. 6, 1996).
In a letter dated December 12, 1996, plaintiff was notified that
his claim for pension benefits for the years 1959-71 was denied,
and told he could appeal the denial. (Plaintiff's Motion for
Partial Summary Judgment, Exh. Q, Letter from Scott A. Ernsberger,
Plan Administrator, Dec. 12, 1996).
On February 5, 1997, plaintiff wrote a letter to the plan
administrator, which plaintiff considered a second appeal.
(Plaintiff's Motion for Partial Summary Judgment, Exh. P, Letter
from Edward J. Foley, Feb. 5, 1997). On April 16, the pension fund
administrators sent plaintiff a detailed letter setting forth the
status of plaintiff's claim and again afforded plaintiff 60 days
to file an appeal. (Plaintiff's Motion for Partial Summary
Judgment, Exh. R, Apr. 16, 1997). Plaintiff received that letter
on April 21. Plaintiff then submitted an appeal, including a
memorandum and affidavits, which was received by the plan
administrators on June 24, 1997, 4 days after the 60-day period
set forth in the April 16 letter. (Plaintiff's Motion for Partial
Summary Judgment, Exh. S, Petition Appeal of Edward J. Foley, June
Plaintiff argues that he appealed the denial of benefits twice in
a timely fashion (on November 6, 1996, and February 5, 1997) and
that the information submitted on June 24, 1997, has no bearing on
the timeliness issue. In order to establish whether plaintiff
appealed the denial of benefits in a timely fashion, I must first
decide when the denial of benefits took place. Plaintiff received
three significant letters following his application for benefits
in July 1996: the September 4 letter, the December 12 letter, and
the April 16 letter. Plaintiff argues that the September 4 and
December 12 letters constituted denials, and that he appealed from
those letters in a timely fashion. Defendants argue that the April
16 letter was the denial, and that plaintiff's appeal from that
letter was untimely.
I am persuaded by plaintiff's argument that the December 12 letter
is a denial under the Plan. The Plan does not define "denial," but
sets forth these requirements: a denial must be in writing, must
set forth the reasons for the denial, and must inform the claimant
of his or her right to appeal. (Defendants' Motion for Judgment on
the Pleadings and for Summary Judgment, Exh. E, at 64). The
December 12 letter did all of this, including informing plaintiff
of his right to appeal the decision. (Plaintiff's Motion for
Partial Summary Judgment, Exh. Q, Letter from Scott A. Ernsberger,
Plan Administrator, Dec. 12, 1996).*fn4 Plaintiff submitted a
letter on February 5, 1997, within 60 days of the December 12
letter, in which plaintiff stated, "[P]lease consider this letter
as my formal written appeal from your December 12, 1996,
decision." (Plaintiff's Motion for ...