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KASZUK v. BAKERY AND CONFECTIONARY UNION

November 8, 1984

JOSEPHINE KASZUK, PLAINTIFF,
v.
BAKERY AND CONFECTIONARY UNION AND INDUSTRY INTERNATIONAL PENSION FUND, ET AL., DEFENDANTS.



The opinion of the court was delivered by: Grady, Chief Judge.

  MEMORANDUM OPINION

In 1978, Walter Kaszuk died after suffering a massive heart attack while vacationing in Arizona. He was 63 years old. At the time of his death Kaszuk was, as he had been for 23 years, employed by the National Biscuit Company ("Nabisco") in Chicago, where he worked as a dough mixer. Surviving Mr. Kaszuk was his wife of many years, Josephine Kaszuk.

Shortly after the death of her husband, Mrs. Kaszuk filed an application for benefits with the defendant, Bakery and Confectionary Union and Industry International Pension Fund ("the Fund").*fn1 Mrs. Kaszuk believed she was entitled to survivorship benefits because Walter had contributed to and been a participant in the Fund for over 21 of his 23 years with Nabisco.

The Fund denied Mrs. Kaszuk's application, explaining that she was ineligible for benefits because, inter alia, her husband had never elected coverage in the Fund's pre-retirement husband and wife pension plan (the "pre-retirement pension").*fn2 After exhausting intra-Fund appeal remedies, Mrs. Kaszuk filed this lawsuit. Her complaint, brought under 29 U.S.C. § 1132, alleges that Mr. Kaszuk failed to elect the pre-retirement pension only because the Fund failed to notify him adequately of the pension's election procedures.*fn3 Mrs. Kaszuk claims that the Fund's failure to provide adequate notice to Fund participants violated certain fiduciary obligations set forth in the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. Had the Fund met its obligations and properly advised Mr. Kaszuk of the election procedures, according to the complaint, Walter Kaszuk would have made the necessary election, Mrs. Kaszuk would have received benefits when he died, and the pension would not have been "forfeited."

Plaintiff has moved for partial summary judgment under Fed.R.Civ.P. 56, arguing that the notice provided to Mr. Kaszuk was inadequate as a matter of law, and that the Fund therefore violated its fiduciary duties. The Fund has cross-moved for summary judgment, asserting that it satisfied all of its obligations to Fund participants, including that of giving adequate notice of the availability of and procedures for electing the pre-retirement pension.

Because the central issue in this case revolves around the adequacy of notice provided by the Fund concerning the pre-retirement pension, it is necessary to set forth in some detail the Fund's efforts in this regard.

The first action taken by the Fund to notify participants of the availability of and procedures for electing the pension came in fall of 1976, when the Fund placed an advertisement in the October 1976 issue of the B & C News, the newspaper of the union to which Mr. Kaszuk and his co-workers belonged. The ad, which comprised one and one-half columns, appeared on page 7 of the newspaper, and was captioned "Important Notice — Husband and Wife Option." The ad explained that the pre-retirement pension had become available on June 1, 1976, and discussed how the pension worked, and how it was to be elected. Although portions of the ad are easily understood, other parts appear to be quite confusing.

The Fund next notified members of their right to elect the pre-retirement option over one year later in a second ad, printed in the November — December 1977 issue of the B & C News. Once again, the ad was inserted on page 7 of the paper. This ad took up nearly a full page, and was somewhat more clearly phrased than the first ad.

Finally, the Fund provided notice of the election procedures in a "Summary Description Booklet" prepared in 1978. It is disputed whether Mr. Kaszuk ever received this booklet, as it was not available to employees until late summer 1978, close to the time Kaszuk died.*fn4

DISCUSSION

  Plaintiff's claim is premised on the notion that the Fund
breached a fiduciary obligation to inform Fund participants in
a meaningful way of the steps which must be taken to elect the
pre-retirement pension. In arguing that the Fund had such an
obligation, plaintiff relies on 29 U.S.C. § 1104 ("§ 1104"),
which provides that fiduciaries such as fund administrators
must:

   . discharge [their] duties with respect to a
  plan solely in the interest of the participants
  and beneficiaries and —

(A) for the exclusive purpose of:

      (i) providing benefits to participants and
    their ...

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