In order to address defendants' contention that plaintiff's allegations do not give rise to an estoppel claim, it is necessary to review the way in which this issue was briefed. When this Court noticed the Seventh Circuit's decision in Black, it sua sponte ordered the parties to submit cross briefs by May 25, 1990, addressing whether Black resurrected plaintiff's estoppel claim by making estoppel available in this type of ERISA case. Minute Order of May 9, 1990. Plaintiff filed a brief on May 25 which argued that estoppel was available in light of Black. Defendants filed a brief on the same day which argued not only that estoppel remained unavailable, but also that even if estoppel were available, plaintiff had not stated a claim for estoppel. The basis for the latter argument was that plaintiff had not alleged -- and could not allege -- reasonable reliance because the language of the Plan made it clear that additional valuation dates could be established.
Due to the briefing schedule imposed after the Black decision, plaintiff had never had an opportunity to address defendants' argument that the complaint did not state an estoppel claim. The Court accordingly requested further briefing on this argument, allowing plaintiff until September 27 to file a supplemental brief in response to defendants' argument and defendants until October 4 to file a supplemental brief in reply. Minute Order of September 13, 1990. On September 27, plaintiff filed a brief responding to defendants' argument that plaintiff had not alleged reasonable reliance. On October 5, defendants filed their reply brief. In that brief, however, defendants did not revisit their reasonable reliance argument; instead, defendants argued that Donofrio had not made a misrepresentation to plaintiff and had not intended to mislead plaintiff. Plaintiff, of course, has had no opportunity to respond to this new argument.
In support of their original argument that plaintiff had not alleged reasonable reliance, defendants rested on the case of Ridens v. Voluntary Separation Program, 610 F. Supp. 770 (D. Minn. 1985). In Ridens, after a full trial, the court found that a plaintiff challenging a denial of severance benefits had not proven estoppel because he had not shown reasonable reliance on the relevant statements. The statements had been made by an individual who had no authority to bind the plan, and plaintiff was aware -- through his possession of the plan and his familiarity with corporate procedures -- that the individual did not have such authority. 610 F. Supp. at 777. Plaintiff argues that Ridens supports his position rather than that of defendants because Ridens was decided after a full factual hearing and because Ridens, unlike this case, involved statements made by an individual who had no authority to bind the plan. Furthermore, the statements alleged in Ridens had the effect of granting an exception to the plan rather than giving an arguably consistent interpretation of the plan.
The Court agrees with plaintiff that Ridens does not control this case. The Court must view the alleged facts in the light most favorable to plaintiff, and the Court cannot say that those facts do not, as a matter of law, demonstrate reasonable reliance. Cf. Dockray v. Phelps Dodge Corp., 801 F.2d 1149, 1155 (9th Cir. 1986) (evidence in record was insufficient for court to determine whether estoppel elements were satisfied). Furthermore, defendants have apparently conceded the validity of plaintiff's arguments by failing to address them in their reply brief. See Gillman v. Burlington Northern Railroad Co., 673 F. Supp. 913, 918 (N.D. Ill. 1987) (denying motion where movant failed to reply to counter-arguments). Accordingly, the Court rejects defendants' argument that plaintiff has failed to allege reasonable reliance.
Defendants' new argument is that plaintiff has not alleged a misrepresentation or intent to mislead. Defendants contend that because additional valuation dates had not yet been established at the time of Donofrio's statements, those statements were correct when they were made. Defendants fail to recognize that the alleged statements went beyond a mere description of the plan as it existed, and included representations to plaintiff as to how his benefits would, in the future, be computed if he took certain actions. The Court need not resolve this issue, however, for defendants did not raise this argument until their reply brief, and they thus have waived the argument. See Wilson v. O'Leary, 895 F.2d 378, 384 (7th Cir. 1990); W.E. O'Neil Construction Co. v. National Union Fire Insurance Co., 721 F. Supp. 984, 999-1000 (N.D. Ill. 1989).
For the reasons described above, the Court finds that estoppel is available to plaintiff and that plaintiff's factual allegations support his claim for estoppel. Accordingly, the Court vacates its opinion of September 14, 1989, to the extent that opinion held that an estoppel claim was unavailable. Plaintiff is granted leave to amend his complaint to reinstate his estoppel claim.