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Watkins v. Goodyear Pension Plan

United States District Court, N.D. Alabama, Middle Division

April 26, 2018

LOYD WATKINS, Plaintiff,



         I. Introduction

         This case arises from an ERISA dispute over the terms of a pension plan (the “Plan”). Before the Court is Defendant Goodyear Pension Plan's (“Goodyear”) Motion for Judgment as a Matter of Law (the “Motion”). (Doc. 13). Plaintiff Loyd Watkins (“Watkins”) responded to the Motion. (Doc. 16). Goodyear replied. (Doc. 24). Accordingly, this Motion is ripe for review.

         II. Factual Background[1]

         The Plan is a "pension plan" as that term is defined in ERISA. 29 U.S.C. §1002(2)(A). The Plan expressly designates the "Pension Board" to administer the Plan:

The administration of the Plan shall be by a Pension Board of five officers and/or employees of the Company, at least three of whom shall be officers. Members of the Pension Board shall be responsible to the Board of Directors of the Company. The Pension Board shall have the authority to elect its own chairman and secretary and to appoint an administrator of the Plan to whom the powers of the Pension Board may be specifically delegated. The Pension Board may adopt by-laws and regulations for the administration of the Plan not inconsistent therewith. Any act or decision of the Pension Board shall require the concurrence of a majority of its members.

(Stipulated Administrative Record (“SAR”) (Doc. 10) at 34).[2] The Plan vests the Pension Board with discretionary power over every facet of Plan administration:

The Pension Board shall have all such power and authority as may be necessary to carry out the provisions of the Plan, including discretionary power and authority to interpret and construe the Plan and to resolve any disputes arising thereunder subject to the provisions of Paragraph 8 and 9 of this Article II and the power and authority expressly conferred upon it herein. The Pension Board shall have authority to grant such pensions or other benefits as are provided under the Plan and to take such further action as it shall deem advisable in the administration of the Plan in accordance with its terms.

(SAR at 34)(emphasis added). The Pension Board and the ERISA Appeals Committee ("EAC") are one and the same body and are interchangeable. (Affidavit of Shawn Breon “Breon Aff.” at p. 2, ¶3 (Exhibit 1 of Evidentiary Submission)). Other than the name, there is no distinction between the EAC and the Pension Board. (Exh. 1 at p. 2, ¶¶3-5). They are not different bodies and do not act independently of one another. (Exh. 1 at p. 2, ¶4). The Plan's administrative review process consists of two levels: the first level of review is conducted by the "Benefits Review Committee" with the second and final level of review conducted by the EAC/Pension Board. (SAR at 9-10 & 26-28; Exh. 1 at p. 2, ¶¶5-6).

         Loyd Watkins, age 86, is a 33 year employee of Goodyear who retired on June 18, 1991. (Doc. 16 at 1 ¶1); (Doc. 24 at 2 ¶1). At the time of his retirement and commencement of pension benefit, Watkins was married to First Wife (Inez Watkins). (SAR at 3-5). Watkins and First Wife signed the “1950 Pension Plan--Notice to Pension Board of Election of Optional Method of Pension Payment” (“Election Form”) on June 19, 1991. (Id. at 4-5). The Watkins' signatures on the Election Form were witnessed by a Goodyear representative, Bettie R. Williams. (Id. at 5).[3] The Election Form sets out five options (i.e., Options A, B, and C, Special 50% Joint and Survivor Option, and No Option) for the retiree and spouse to consider. (Id. at 4-5). The chosen option is identified by checking the box that appears next to that option on the form. (Id.). On Watkins' Election Form, the box next to “Option B (50%)” was checked on the first page of the form. (Id. at 4). No other box was checked on the form. (Id. at 4-5).

Option B is the 50% joint and survivor option, which provides a benefit for the retiree's surviving spouse described in part as follows:
(2) After the first 60 monthly pension payments have been made, a reduced monthly pension shall be payable to me [i.e., the retiree] for life.
(3) After my death, (but only if my death occurs after the Option becomes effective) my spouse, as Contingent Annuitant, shall receive monthly payments in an amount equal to one-half of such reduced amount as would have been paid to me had I been then living, with such payment to continue during the lifetime of my spouse.

(Id. at 4). In the Election Notice at Option B, Watkins designated First Wife as “my spouse”. (Id.).

         Effective July 1, 1991, Watkins began receiving from the Plan an unreduced monthly pension benefit payment (in the amount of $910.00) under Option B. (Id. at 6). In July 1996, after receiving 60 unreduced monthly payments, in accordance with the terms of Option B, Watkins' monthly pension benefit payment was reduced to $773.77 for the remainder of his life. (Id. at 4, 6).

         On July 1, 1991, when he began receiving his Plan benefit, Watkins was married to First Wife. (Id. at 1, 5, 26). First Wife died on August 21, 2014. (Id. at 1, 26). On May 25, 2015, Watkins married Second Wife (Bobbie F. Watkins). (Id.).

         On January 4, 2016, Goodyear received a letter from Watkins requesting that Second Wife be allowed to receive a survivor pension benefit if Watkins predeceased Second Wife. (Id. at 1-2). Goodyear's Benefits Review Committee (“BRC”) reviewed Watkins' request. (Id. at 9-10). Shawn Breon, Goodyear's Manager Benefit Operations, on behalf of the BRC, sent Watkins a letter dated March 4, 2016 informing Watkins that the BRC had reviewed his request to make Second Wife his surviving spouse, and that the request was denied. (Id.).[4] In that letter, Breon wrote, in relevant part:

The [BRC] determined that after the death of your spouse, Inez Watkins, no survivor pension benefit is payable to your current spouse, Bobbie, because you were not married to Bobbie on July 1, 1991[, ] when your pension payment commenced.
. . .
You retired from Goodyear-Gadsden under the 1950 Pension Plan on July 1, 1991. At the time of your retirement, you elected (with spousal consent by Inez Watkins) Option B-50% Joint and Survivor Option for your spouse, Inez G. Watkins…. Our records indicate that this spouse, Inez Watkins, died on August 21, 2014[, ] and you later married Bobbie F. Watkins on May 25, 2015. You and your current spouse, Bobbie, were not married on the date your pension payments commenced, July 1, 1991, and therefore, Bobbie does not satisfy the eligibility requirements [in the Plan] and no survivor pension benefit is payable to her.

(Id. at 9). Breon notified Watkins of his right to appeal this determination to the EAC/Pension Board. (Id. at 10).Watkins responded, by counsel, by letter dated June 24, 2016, in which counsel wrote, among other things:

12. There is a conflict between Option B, as signed by Loyd Watkins, and the 1950 Pension Plan, creating an ambiguity.
13. Since Option B included no provision for the spouse dying before the employee, Plaintiff should be entitled either to full pension or entitled to add his current spouse as a contingent beneficiary on his pension plan.
14. Loyd Watkins reasonably relied on the wording of Option B as presented to him at retirement.

(Id. at 13); (see also Watkins's Affidavit) (“I reasonably relied on Option B as presented at the time I signed up for my pension.”).[5]

         The EAC/Pension Board met on December 7, 2016 to consider Watkins' appeal. (SAR at 14-16). Attorney Allenstein participated in that appeal meeting by phone. (Id.). On December 7, 2016, Attorney Allenstein submitted to the EAC/Pension Board by email an unsigned statement ...

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