Opinion ID: 724948
Heading Depth: 2
Heading Rank: 1

Heading: The class action suit against the CLPT and its trustees

Text: 3 Appellant and lead plaintiff Mario Canseco is 77 years old. For nearly 30 years, he worked in the construction industry in Southern California. In 1975, at age 56, Canseco became permanently disabled and was unable to continue working as a construction laborer. Although Canseco had worked in the industry for nearly 30 years, the 1975 CLPT records erroneously indicated that he had accumulated only 14 years and 10 months of service, just shy of the 15-year eligibility requirement for normal retirement benefits under the CLPT plan. When Canseco asked union officials whether he was eligible for pension benefits, they erroneously informed him that he was not eligible because he had not met the 15-year service minimum. Believing the CLPT records were accurate, and knowing his permanent disability would prevent him from earning additional years of service, Canseco did not apply for pension benefits under the CLPT plan. 4 In 1987, however, the possibility of CLPT pension benefits suddenly materialized for Canseco. He received a notice from a federal district court in California informing him that he may be entitled to pension benefits as a result of a judgment in a class action suit against the CLPT plan. That judgment, contained in Ponce v. Construction Laborers Pension Trust for Southern California, 582 F.Supp. 1310 (C.D.Cal.1984), aff'd, 774 F.2d 1401 (9th Cir.1985), cert. denied, 479 U.S. 890, 107 S.Ct. 289, 93 L.Ed.2d 263 (1986), held that the CLPT's 15-year service requirement was arbitrary and capricious and constituted a structural defect in violation of the Taft-Hartley Act, 29 U.S.C. § 186(c)(5), and required the Trustees of the CLPT to lower the eligibility threshold from 15 years of service to 10 years. Ponce, 582 F.Supp. at 1318. Ponce established new eligibility rules for construction workers who had been illegally denied benefits because they had attained more than 10 years but less than 15 years of service. The notice informed Canseco that he might qualify for pension benefits because CLPT records indicated that he had attained between 10 and 15 years of service. Canseco promptly applied for pension benefits under the Ponce judgment. 5 The Trustees administering the Ponce judgment initially concluded, based on the CLPT's erroneous records of Canseco's service history, that he was eligible for Ponce benefits. However, after paying Canseco his initial benefits, the Trustees discovered that the records were erroneous, and that Canseco had actually accrued nearly 23 years of service before becoming disabled. Because Canseco had attained well over the 15 years required for eligibility, the Trustees concluded he had been eligible for normal retirement benefits of $988 a month beginning in 1981, when he reached age 62, the minimum age required for eligibility under the CLPT plan. As noted above, however, Canseco had not applied for pension benefits when he turned 62 because he had been told--erroneously--that he failed to satisfy the service requirement for normal retirement benefits. 6 Although the Trustees concluded that Canseco had been eligible for normal retirement benefits beginning in January 1981, when he turned 62, they refused to pay him benefits retroactive to that date because--applying nearly perfect Catch-22 logic--he had failed to apply for them. Instead, the Trustees accorded Canseco benefits retroactive only to March 1, 1985, the year after he turned 65, pursuant to Section 5.04 of the CLPT plan, which provides that benefit payments shall commence not later than March 1 of the year following the retiree's 65th birthday. The Trustees denied Canseco retroactive benefits, however, for the period from January 1981, when he turned 62, to March 1, 1985, the year after he turned 65. 2 Canseco appealed the Trustees' decision to the CLPT's Pension Appeals Committee, but the Committee rejected his appeal in January 1989. 7 In January 1992, Canseco filed a class action suit in federal district court against the Trustees and the CLPT, seeking the payment of benefits retroactive to the date the class members originally became eligible for normal retirement benefits. He sought to represent all those CLPT plan participants who, like him, had attained eligibility for normal retirement benefits but who were accorded retroactive benefits beginning March 1 of the year after they turned 65. 3 After the Retirees and the Trustees filed cross-motions for summary judgment, the district court granted summary judgment for the Trustees as to all the Retirees' claims. 8 The Retirees appeal the district court's summary judgment order only as to their first three claims. The Retirees' first claim, which arises under 29 U.S.C. § 1132(a)(1)(B), is that the terms of the CLPT plan entitle them to retirement benefits retroactive to the date they became eligible for those benefits. Their second claim is that the Trustees' denial of retroactive benefits constituted a breach of their fiduciary duty under the Employee Retirement Income Security Act (ERISA), 29 U.S.C. § 1104. Finally, their third claim is that the Trustees' denial of retroactive benefits violated ERISA's non-forfeitability provision, 29 U.S.C. § 1053.