United States District Court, N.D. Illinois
For Frederick Schatzel, Plaintiff: Thomas William Flannigan, Law Office of Thomas Flannigan, Chicago, IL.
For Central States Southeast And Southwest Areas Pension Fund, Defendant: Francis Joseph Carey, LEAD ATTORNEY, Central States Law Department, Rosemont, IL.
For Western Pennsylvania Teamsters and Employers Pension Fund, Defendant: Michael Giuseppe Congiu, LEAD ATTORNEY, Littler Mendelson, P.C., Chicago, IL.
MEMORANDUM OPINION AND ORDER
MATTHEW F. KENNELLY, United States District Judge.
Frederick Schatzel has sued the Central States Southeast and Southwest Areas Pension Fund (Central States) and the Western Pennsylvania Teamsters and Employers Pension Fund (Western Pennsylvania) for pension benefits that he contends the defendants owe him. Schatzel alleges that defendants violated the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1001 et seq., by wrongfully denying him benefits and by violating their fiduciary duties in their dealings with him. Schatzel has also asserted a state law claim that the defendants should be estopped from denying him pension benefits under the doctrine of promissory estoppel.
Western Pennsylvania has moved to dismiss Schatzel's promissory estoppel and fiduciary duty claims. Central States has filed two motions to dismiss, likewise seeking dismissal of the promissory estoppel and fiduciary duty claims. Central States has also moved for summary judgment on Schatzel's remaining claim against it, for wrongful denial of benefits under ERISA section 502(a)(1)(B). 29 U.S.C. § 1132(a)(1)(B). Schatzel has moved to strike Western Pennsylvania's motion to dismiss, Central States's first motion to dismiss, and Central States's motion for summary judgment. For the reasons stated below, the Court denies Schatzel's motions to strike; grants the three motions to dismiss, two of which it construes as motions for judgment on the pleadings; and grants Central States's motion for summary judgment.
Because Schatzel is the nonmoving party, the Court accepts the allegations in his complaint as true and draws reasonable inferences in his favor for purposes of any motions under Federal Rule of Civil Procedure 12. For purposes of the motion for summary judgment, the Court views the facts in the light most favorable to Schatzel and draws reasonable inferences in his favor. The Court takes the following facts
from Schatzel's complaint, unless otherwise noted.
Both defendants are Teamsters Union-related pension plans that are subject to ERISA. Schatzel participated in the pension plans from June 1977 until July 1989. Although not alleged in the complaint, the Court notes that a union worker's participation in a pension plan typically arises from his employment with a company that has entered into a collective bargaining agreement with the union. Under the terms of that agreement, the company makes contributions to a pension fund on behalf of its union employees. According to Schatzel, he worked for employers that made contributions to the Central States Pension Fund on his behalf from June 1977 until September 1981. He then became employed with a company that contributed to the Western Pennsylvania Pension Fund on his behalf. Schatzel participated in the Western Pennsylvania fund until July 1989.
On February 24, 1986, Central States sent Schatzel a letter stating that he had 3.85 years of " credit service" and 5 years of " vesting service." Compl., Ex. 1. The letter further stated that:
You are eligible for a vested pension benefit once you have at least 10 years of employer contributions. Each of those 10 years must have 20 weeks of contributions or more.
If you leave the Fund and don't return for several years you can lose all of your credited service. This is called a break in service. How long you can safely stay out of the Fund depends on how many vesting service years you have. In your case, you have 5 vesting service years, so you would lose your credited service if you left the Fund for 5 or more years. If you don't accumulate 10 weeks or 37 days of employer contributions before December 31, 1986, you will have a full break in service.
Id. Schatzel does not contend that he responded to this letter.
Three years later, in 1989, Schatzel contacted Central States, " concerning his progress towards a vested pension." Compl. ¶ 11. According to Schatzel, Central States responded by preparing an affidavit (which he attached to his complaint) stating that he worked " 4 3/12 years under a continuous labor contract negotiated by this Union." Id., Ex. 2. Central States contends that this affidavit was prepared by a union representative, not a representative of the Central States fund, but the affidavit itself is printed on letterhead bearing Central States's name.
According to Schatzel, when he received the affidavit, he forwarded it to Western Pennsylvania. In response, Western Pennsylvania wrote Schatzel a letter on September 25, 1989, that read:
Our records indicate that you worked under this Fund from 10-24-81 to 7-1-89. Based on your affidavit from the Central States Pension Fund, it appears you are eligible for a reciprocal pension benefit from this Fund at age 60. Please retain this letter to use as documentation as your proof of eligibility.
Id., Ex. 3. According to the complaint, Schatzel moved to Alaska at some point--the complaint does not specify when--and has remained there to this day. He currently works for the Alaska State Ferry System. Schatzel contends that he moved to Alaska and took on non-union employment based on his belief that he had vested pension benefits that he would begin receiving upon reaching age sixty.
Several years later, in 2010, Schatzel contacted the defendants about his upcoming retirement plans. In response, a Central States analyst wrote to Western Pennsylvania to advise that Central States ...