Opinion ID: 3012559
Heading Depth: 3
Heading Rank: 1

Heading: Grant of Summary Judgment in favor of Ryan

Text: ERISA 204(g)(1) prohibits the retroactive reduction of accrued benefits by operation of a plan amendment. See 29 U.S.C. 1054(g)(1) (2001); see also Hoover v. Cumberland Maryland Area Teamsters Pension Fund, 756 F.2d 977, 984 (3d Cir. 1985) (Section 204(g) of ERISA protects all accrued benefits from reduction by plan amendment, vested or not, and without regard to whether benefits are currently being paid to a participant who has already retired.). The parties agree that the Trustees' amendment to and subsequent application of Section 6.01(c) of the Plan reduced Ryan's benefits. Consequently, the sole issue raised by defendants on appeal is whether Ryan's benefits are accrued benefits as defined in ERISA and protected by 204(g)(1). Citing the clear language of the SPD, the District Court found that Ryan's benefits are accrued benefits. We agree with the District Court's conclusion. Section 3(23) of ERISA defines accrued benefit as the individual's accrued benefit determined under the plan . . . expressed in the form of an annual benefit commencing at normal retirement age . . .. 29 U.S.C. 1002(23)(A). In Ryan's case, the term normal retirement age means the earlier of the time [Ryan] attains normal retirement age under the [P]lan, or . . . the time [Ryan] attains age 65 . . . . Id. at 1002(24). Ryan was younger than 65 when he started receiving his benefits. Therefore, his benefits are accrued benefits only if he began receiving them at an earlier normal retirement age set forth in the Plan. The defendants contend that Ryan's benefits are in fact early retirement benefits and for that reason are not protected by 204(g). Defendants contend that the District Court erred by confusing retirement date with retirement age -- and since Ryan had not reached the retirement age of 65, his retirement was an early one. We conclude, however, that Ryan did not take early retirement and that the District Court correctly determined that his accrued benefits were protected by 204(g). The SPD language quoted above provides each participant with [n]ormal retirement . . . at any earlier age that [he or she has] 25 years of Credited Service. The District Court, therefore, correctly found that the Plan set forth a normal retirement age at any age before 65 for participants who have earned 25 years Credited Service and correctly concluded that Ryan's benefits are accrued benefits. This result is supported by our decision in Geib v. New York State Teamsters Conference Pension & Retirement Fund, 758 F.2d 973 (3d Cir. 1985). In Geib, we addressed the issue whether ERISA 203(a) protects pensioners from the suspension of benefit payments received before normal retirement age. See 758 F.2d at 976. Answering this question in the negative, we found that the plan at issue in Geib failed to set forth a normal retirement age earlier than age 65 as permitted by ERISA 3(24). See id. at 976-77. The Geib court distinguished Nichols v. Board of Trustees of the Asbestos Workers Local 24 Pension Plan, 1 E.B.C. (BNA) 1868 (D.D.C. 1979), on which plaintiffs relied, noting that the language of the plan at issue in Nichols did set forth 25 years of credited service as a normal retirement age. See 758 F.2d at 976. The plan language in Nichols was substantively identical to the SPD language quoted above. It read: An employee shall be eligible to receive a Normal Pension if he retires after: a) he has been credited with twenty-five (25) years of credited service at any age, or b) he has attained the age of sixty-five (65) and has been credited with a minimum of five (5) years of credited service. Nichols, 1 E.B.C. (BNA) at 1868. Geib's conclusion regarding the plan at issue in Nichols supports the conclusion that the Plan here sets an alternative normal retirement age at the time that a participant attains 25 years of Credited Service. We note moreover that Ryan's retirement benefits have not been actuarily reduced to award to him at age 60 the present value of his age 65 benefits. If in fact his benefits had been considered by the Trustees to be early retirement benefits, they would have been so reduced. Defendants contend nevertheless that the Trustees did not act arbitrarily and capriciously when they awarded benefits to Ryan under the two tier system. We have, however, determined as a matter of law that the two tier system does not apply under the undisputed facts of Ryan's situation. Under an arbitrary and capricious standard of review, we need not defer to the Trustees' decisions which are without reason, unsupported by substantial evidence or erroneous as a matter of law. Courson v. Bert Bell NFL Player Retirement Plan, 214 F.3d 136 (3d Cir. 2000) (emphasis added). See also Skretvedt v. E.I. DuPont de Nemours and Co., 2001 WL 1185796 (3d Cir. 2001); Abnathya v. Hoffmann-La Roche, Inc., 2 F.3d 40 (3d Cir. 1993). We will therefore affirm the summary judgment in favor of Ryan.