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BURKE v. AMERICAN STORES EMPLE. BEN. PLAN

March 2, 1993

JUDITH A. BURKE, Plaintiff,
v.
AMERICAN STORES EMPLOYEE BENEFIT PLAN and AMERICAN STORES COMPANY, Defendants.


HOLDERMAN


The opinion of the court was delivered by: JAMES F. HOLDERMAN

JAMES F. HOLDERMAN, District Judge:

 Plaintiff Judith A. Burke filed this action against defendants American Stores Employee Benefit Plan and American Stores Company ("American Stores"), claiming violations of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. §§ 1001 et seq. The parties have filed cross motions for summary judgment. For the reasons stated in this memorandum opinion and order, plaintiff's motion is denied and defendants' motion is granted.

 FACTUAL BACKGROUND

 From February 1, 1989 to November 28, 1989, plaintiff Judith Burke worked for Jewel Food Stores, Inc. ("Jewel"), a subsidiary of defendant American Stores Co., as a part-time grocery clerk at a Jewel store in Joliet, Illinois. (See Defendants' Statement of Undisputed Facts, PP 1-2.) During her tenure as a Jewel employee, plaintiff Burke was covered by the American Stores Health Care Plan ("the Plan"), which is a self-insured employee benefit plan subject to ERISA. (Id., P 4.)

 On November 28, 1989, Jewel terminated plaintiff's and another individual's employment. The dismissal followed an inquiry into their allegedly improper use of Jewel promotional materials--"Turkey Saver Stamps"--to obtain free turkeys from Jewel food stores. Plaintiff handwrote a signed statement on November 22, 1989 at the request of Jewel investigating personnel in which plaintiff admitted:

 
About 2 or 3 weeks ago, (Jane Doe) *fn1" brought Jewel saver stamps to my home, which she had which she had wrongfully gotten from the Jewel store on Jackson Street, Joliet, Illinois. After this time, (Jane) had brought saver stamps to the house approx. 2 or 3 other times. These stamps were removed from books & placed on stamp saver pages. With these Jewel stamps we ([Jane Doe], my daughter Marge, and myself) went to different Jewel stores in the Joliet area & purchased turkeys without paying for them. I myself personally went about 5 times & obtained turkeys with the Stolen Jewel saver stamps.
 
I realize this was wrong and a violation of comp. policy when I knowingly used these Jewel saver stamps to purchase turkeys because I know the stamps were taken from the Jewel store by (Jane Doe).

 (See Defendants' Statement of Undisputed Facts, P 14; Exhibit E.)

 Several months after her termination from Jewel, Ms. Burke fell in her home and was injured. Thereafter, between March 6, 1990 and June 28, 1990, plaintiff incurred more than $ 150,000 in medical fees, which were not paid by the Plan. (Id., P 19.) These funds are the subject of this lawsuit.

 Prior to her termination, plaintiff Burke had filed a worker's compensation claim against Jewel and was suffering from physical ailments for which she was receiving medical care. (Plaintiff's Statement of Undisputed Facts, PP 1, 8.) The Jewel Area Personnel Manager who fired plaintiff knew of Ms. Burke's pending worker's compensation claim when she discharged Ms. Burke. (Plaintiff's Response to Defendant's Statement of Undisputed Facts, P 16.) Ms. Burke maintained, at her deposition in this case, that at the time she redeemed the Turkey Saver Stamps and obtained free turkeys, she was unaware that the stamps given to her by Jane Doe were stolen. (Burke Deposition, pp. 39 and 68.) Ms. Burke contends that her November 22, 1989 statement was made in the context of the knowledge she had after talking with the Jewel investigating personnel at the time she wrote the November 22, 1989 statement. (Plaintiff's Response to Defendant's Statement of Undisputed Facts, P 14.) According to Ms. Burke, Jewel investigating personnel told her what to write in the statement and also told her that the statement would not jeopardize her job or her health benefits. Ms. Burke, however, does not "retract the Veracity of" her November 22, 1989 statement. Id.

 DISCUSSION

 In Count I of her Amended Complaint, plaintiff Burke asserts a claim under 29 U.S.C. § 1132(a)(1)(B) of ERISA for wrongful denial of benefits. In Count II, she claims that defendants violated COBRA, 29 U.S.C. § 1161 et seq., by not notifying her of her eligibility for continuing health benefits coverage. In Count III, plaintiff alleges, pursuant to 29 U.S.C. § 1140, that Jewel's termination of her employment and its refusal to offer her continuation coverage constituted discrimination for and intentional interference with her attainment of a right accorded to her by a benefits plan covered by ERISA.

 I. COUNTS I AND II: TERMINATION FOR "GROSS MISCONDUCT"

 The viability of plaintiff's claims in Counts I and II hinges on whether the "gross misconduct" termination exemption of COBRA properly applies under the facts in her case. Plaintiff bases her claims for post-termination benefits on 29 U.S.C. § 1161(a) of COBRA, which provides that:

 
The plan sponsor of each group health plan shall provide in accordance with this part, that each qualified beneficiary who would lose coverage under the plan as a result of a qualifying event is entitled, under the plan, to elect, within ...

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