United States Court of Appeals

FOR THE EIGHTH CIRCUIT

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No. 97-2817MN

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Mary Ellen Marolt, *

*

Appellee, *

*

v. *

* Appeal from the United States

Alliant Techsystems, Inc.; Alliant * District Court for the District

Techsystems Pension and Retirement * of Minnesota.

Administrative Committee; Mellon *

Bank, N.A., *

*

Appellants. *

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 Submitted: May 13, 1998

Filed: July 13, 1998

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Before RICHARD S. ARNOLD, JOHN R. GIBSON, and FAGG, Circuit Judges.

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FAGG, Circuit Judge.

Alliant Techsystems, Inc. (Alliant Tech), the Alliant Techsystems Pension and

Retirement Administrative Committee (PRAC), and Mellon Bank, N.A. (collectively

Alliant) appeal the district court’s order granting summary judgment for Mary Ellen

Marolt, and denying Alliant’s cross-motion for summary judgment, in this Employee

Retirement Income Security Act (ERISA) lawsuit. We agree with the district court that
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the PRAC abused its discretion in rejecting Marolt’s appeal concerning her retirement

benefits, and we thus affirm.

The pertinent facts are undisputed. Marolt worked at Honeywell from 1980 to

1989. In September 1990 Honeywell spun off several divisions to create Alliant Tech,

a subsidiary of Honeywell. In November 1990 Marolt took a temporary position with

Alliant Tech. The following March, Marolt’s supervisor offered Marolt a permanent

position. The supervisor told Marolt she believed Marolt was entitled to “bridge” her

break in service--that is, to date her employment with Alliant Tech from the start of her

employment at Honeywell, which would increase Marolt’s retirement benefits. After

Marolt’s supervisor discussed the matter with Alliant Tech’s human resources

department, she assured Marolt the break would be bridged, and Marolt accepted the

permanent position. Marolt then formally applied for bridging to her Location Benefits

Administrator (LBA), who approved the application in December 1991. Alliant Tech

confirmed Marolt’s bridging status several more times, both orally and in writing. In

June 1994, however, Marolt’s LBA informed Marolt she was not entitled to bridging

after all because she had not been employed with Honeywell on the date of the Alliant

Tech spin off. The PRAC denied Marolt’s appeal of this decision without further

explanation, saying only that it “recognize[d] that errors had been made in

communicating credited service[] dates, but the correction to you was communicated

properly. As a result, your request to bridge your credited service is denied.” Marolt

then brought this lawsuit under 29 U.S.C. § 1132(a)(1)(B) to clarify her rights to future

benefits.

Alliant Tech’s Summary Plan Description (SPD) contains the following relevant

provisions:

If you leave Alliant Techsystems and later return, you have a break in

service. You may be eligible to receive credit for your prior service,

through a process called bridging, when you return to work.
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It is your responsibility to initiate bridging of a break in service by

contacting your Location Benefits Administrator (LBA). . . .

If you left Alliant Techsystems (Honeywell) on or after February 1,

1976: Your service before the break will be counted if:

You were vested and had at least five years of credited service

when your employment ended; or

You were not vested and were away from the company for less

than five years; or

The length of time you were away from the company was less than

your credited service at the time you left; or

Your total periods of credited service equal 20 years or more. . . .

Notes: 1) Generally, credited service with Honeywell Inc. prior to our

9/28/90 spinoff is included in credited service with Alliant Techsystems.

. . . 4) Temporary service prior to January 1, 1990, may count toward

credited service. Your Location Benefits Administrator can provide

details if needed.

It is undisputed that Marolt was vested under Honeywell’s retirement plan, that Marolt

had more than five years of credited service at Honeywell, and that Marolt left

Honeywell after February 1, 1976. Thus, according to the SPD her “service before the

break will be counted.”

Alliant Tech’s formal retirement plan document also addresses the bridging issue,

although it takes some digging to understand how. Section 1.1.12(a) of the formal plan

provides that “[s]ervice with Honeywell Inc. shall be considered service with [Alliant

Tech] to the extent described in Section 1.5.” Section 1.5 states that “service with

Honeywell Inc. shall be considered service with [Alliant Tech] for purposes of

determining Credited Service under Section 1.1.12 to the extent . . . such
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crediting is required under the Distribution Agreement . . . .” Section 1.5 does not refer

the reader to any particular part of the Distribution Agreement, a 115-page document

governing the Alliant Tech spin off. Nevertheless, on page seventy-four of that

document, subsection 8.03(d)(i) gives credit for service at Honeywell to “Transferred

Employees,” and on pages thirteen and fourteen “Transferred Employee” is defined to

include only those persons who were employed at Honeywell on the date of the spin off.

Marolt was not employed with Honeywell on that date. The district court concluded,

however, that the Distribution Agreement is not part of Alliant Tech’s ERISA plan.

With the Distribution Agreement out of the picture, the district court held the PRAC’s

decision was unreasonable because the SPD expressly provides for bridging in cases

like Marolt’s.

We review de novo the district court’s grant of summary judgment for Marolt,

applying the familiar standard set forth in Federal Rule of Civil Procedure 56(c), and

viewing the factual record in the light most favorable to the losing party, Alliant. See

Barker v. Ceridian Corp., 122 F.3d 628, 632 (8th Cir. 1997). Because Alliant Tech’s

ERISA plan gives the PRAC discretionary authority to interpret and apply the plan’s

provisions, the district court reviewed the PRAC’s decision for abuse of discretion. See

Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); Donaho v. FMC

Corp., 74 F.3d 894, 898 (8th Cir. 1996). Under this standard of review, the PRAC’s

decision stands unless it was “without reason, unsupported by substantial evidence or

erroneous as a matter of law.” Donaho, 74 F.3d at 900 (internal quotations omitted).

“We review de novo a district court’s application of the deferential standard of review.”

Id. at 898.

Alliant disagrees with the district court’s analysis. First, contrary to the district

court’s rejection of the Distribution Agreement, Alliant maintains the formal plan

document incorporates the Agreement, and under the Agreement’s relevant provisions

Marolt is disqualified from bridging. Second, contrary to the district court’s conclusion

that the SPD expressly entitles Marolt to bridging, Alliant contends the SPD is silent
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about bridging rights in Marolt’s particular circumstances--those of a former Honeywell

employee who was not employed with Honeywell on the date of the spin off. See

Jensen v. SIPCO, Inc., 38 F.3d 945, 952 (8th Cir. 1994) (observing that although “an

SPD provision prevails if it conflicts with a provision of a plan,” that rule “does not

apply when the plan document is specific and the SPD is silent on a particular matter”).

Emphasizing the word “[g]enerally” in note one to the SPD’s bridging provisions,

Alliant interprets those provisions as general rules only. According to Alliant, another

part of the SPD directs plan participants like Marolt to the formal plan document for the

specifics on bridging: “This SPD is not meant to cover every detail of the plan.

Complete details are in the plan document . . . .” Third, Alliant argues that the SPD

itself makes bridging available only to employees who “leave . . . and later return.”

Alliant interprets this phrase to mean that only those employees who left Honeywell and

came back to Honeywell, or who left Alliant Tech and came back to Alliant Tech, are

entitled to bridge. Under this interpretation of the SPD, employees like Marolt who left

Honeywell and came back to Alliant Tech did not “leave . . . and later return,” so the

SPD itself disqualifies persons in Marolt’s circumstances from bridging. 

Alliant does not explain how the SPD can both address Marolt’s particular

situation and remain silent about it at the same time. Also, Alliant’s view that the SPD’s

general reference to the formal plan--“[c]omplete details are in the plan document”--

requires employees to consult the formal document for details about bridging renders

meaningless the SPD’s specific direction to consult with and rely on the LBA for those

details, as Marolt did. If Alliant’s hindsight interpretation of the SPD were the

interpretation the PRAC formulated and applied when it decided Marolt’s case, we

would have to consider whether these inconsistencies make Alliant’s interpretation

unreasonable. See Finley v. Special Agents Mut. Benefit Ass’n, Inc., 957 F.2d 617, 621

(8th Cir. 1992).

The fact is, the PRAC did not provide a rationale for its decision. The PRAC’s

failure in this regard was contrary to the ERISA statute, federal regulations, and this
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court’s longstanding precedent. See 29 U.S.C. § 1133(1) (1994); 29 C.F.R. §

2560.503-1(h)(3) (1997); Richardson v. Central States, Southeast & Southwest Areas

Pension Fund, 645 F.2d 660, 664, 665 (8th Cir. 1981). We will not permit ERISA

claimants denied the timely and specific explanation to which the law entitles them to

be sandbagged by after-the-fact plan interpretations devised for purposes of litigation.

The record shows Marolt’s LBA took away Marolt’s bridging based on the Distribution

Agreement. Because the PRAC affirmed the LBA without giving a different

explanation, we conclude the PRAC also based its decision on the Distribution

Agreement. Contrary to Alliant’s contention that “the PRAC implicitly and necessarily

interpreted” the SPD, the record shows no such thing, let alone that in deciding Marolt’s

appeal the PRAC construed particular words and phrases in the SPD as Alliant now

does. It is the PRAC’s interpretation to which we must defer if reasonable; we are free

to ignore ERISA plan interpretations that did not actually furnish the basis for a plan

administrator’s benefits decision. See Brumm v. Bert Bell NFL Retirement Plan, 995

F.2d 1433, 1437 (8th Cir. 1993).

We have our doubts whether the plan document’s reference to the Distribution

Agreement sufficed to incorporate the Agreement’s relevant provisions in the formal

plan. See Rinard v. Eastern Co., 978 F.2d 265, 269 n.3 (6th Cir. 1992) (requiring,

among other criteria, that the “terms of the incorporated document . . . be known or

easily available to the contracting parties”). Because the record does not establish that

the Distribution Agreement was unavailable to Marolt, however, we will assume the

provisions of the Agreement involved here are part of Alliant Tech’s formal plan. We

may, of course, affirm the district court on any ground supported by the record. See

Hall v. LHACO, Inc., 140 F.3d 1190, 1193-94 (8th Cir. 1998). Although the SPD does

not mention the transferred employee restriction, we reject Alliant’s view that the SPD

is silent on the “particular matter” at issue here, Jensen, 38 F.3d at 952, which is

bridging. On that subject, the SPD recites a number of criteria that clearly and

unambiguously entitle Marolt to bridge her break in service. Those are binding. See

id. Just as clearly, the Distribution Agreement rules out bridging for Marolt. When
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summary plan description provisions conflict with formal plan provisions, the summary

plan provisions prevail as a matter of law. See Barker, 122 F.3d at 633; Jensen, 38 F.3d

at 952. Thus, it was an abuse of discretion for the PRAC to reject Marolt’s bridging

request based on Distribution Agreement provisions incorporated in the formal plan.

See Donaho, 74 F.3d at 900 (plan administrator abuses discretion when its decision is

legally erroneous). This case well illustrates the reason for the Barker and Jensen rule.

A plan document required by law to be plainspoken for the benefit of “average plan

participant[s],” 29 U.S.C. § 1022(a)(1) (1994), and furnished to participants, see id. §

1024(b)(1), says one thing, and an obscure passage in a transactional document only

lawyers will read and understand says something else. The accessible provisions

govern because “[a]dequate disclosure to employees is one of ERISA’s major

purposes.” Barker, 122 F.3d at 633.

Alliant contends Marolt must prove she relied on the SPD to her detriment. We

disagree. We have indeed held that “to secure relief on the basis of a faulty summary

plan description, the claimant must show some significant reliance on, or possible

prejudice flowing from the summary,” Maxa v. John Alden Life Ins. Co., 972 F.2d 980,

984 (8th Cir. 1992) (alteration and internal quotations omitted), but Marolt does not

contend Alliant Tech’s SPD is faulty. A faulty summary plan description is one that

fails to meet “the requirements of ERISA and its attendant regulations.” Id. Marolt

says in her brief the SPD “meets the requirements of ERISA.” Relying on Anderson

v. Alpha Portland Indus., Inc., 836 F.2d 1512, 1520 (8th Cir. 1988), however, Alliant

argues that by claiming the SPD and the formal plan conflict, Marolt necessarily

contends the SPD is faulty. Although one or two sentences lifted out of context appear

to support Alliant’s argument, Anderson does not so hold. 

At issue in Anderson was whether the parties to a collective bargaining agreement

(CBA) that included a welfare plan intended benefits under the plan to terminate when

the CBA expired. See id. at 1513. Contending the parties intended to confer vested

lifetime benefits, see id., the claimants in Anderson pointed to a provision
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of their SPD, which read: “Coverage will continue for the remainder of your life.”

Because substantial contrary evidence drawn from the CBA showed no intent to vest

benefits, the district court ruled against the claimants despite the SPD’s language, and

we affirmed. See id. at 1519. The claimants also argued they were entitled to recover

under provisions of ERISA that require SPDs to “apprise . . . participants and

beneficiaries of their rights and obligations under the plan” and to disclose

“circumstances which may result in disqualification, ineligibility, or denial or loss of

benefits,” 29 U.S.C. §§ 1022(a)(1), (b). See Anderson, 836 F.2d at 1519-20. At the

same time, the claimants maintained they did not have to show they relied on their SPD

because they did not consider the SPD “faulty.” We rejected this self-contradictory

argument. See id. at 1520. Anderson stands for the unremarkable proposition that an

ERISA plaintiff who claims a summary plan description violates 29 U.S.C. § 1022

necessarily contends the summary description is faulty. Marolt makes no such claim.

We affirm the district court.

A true copy.

Attest:

CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.