Opinion ID: 760887
Heading Depth: 3
Heading Rank: 2

Heading: Written Misrepresentations

Text: 36 Plaintiffs argue that the alleged written misrepresentations should not be subject to the serious consideration test. They rely on Helwig v. Kelsey-Hayes Co., 93 F.3d 243 (6th Cir.1996), cert. denied, 519 U.S. 1059, 117 S.Ct. 690, 136 L.Ed.2d 613 (1997), for the proposition that representations contained in Summary Plan Descriptions are entitled to special protection under ERISA. Helwig held that employers and plan administrators are bound by promises in a Summary Plan Description even if it differs from the language of the plan. Id. at 250. It emphasized the importance of Summary Plan Descriptions to employees, saying that employees rely in particular on written promises when making decisions about retirement. Id. However, it did not speak to a duty to correct Summary Plan Descriptions which may have become misleading after their distribution to employees due to future events and plan amendments. 37 Plaintiffs present no sound basis for finding that the written representations became misleading at any time prior to the date of serious consideration. It seems, in fact, that it is only the serious consideration of plan enhancement that could have made the statement highlighted by the plaintiffs even arguably misleading. (It should be noted that employees who are retirement eligible most likely will not find a financial advantage in this program [Leave of Absence option] since they would be deferring their retirement income until the end of their leaves.). 38 However, the court should not ignore the allegations of written materially misleading statements in the Summary Plan Descriptions in favor of the oral misrepresentations. Even if truthful when written, a representation can become misleading through future changes in events. When a representation is written, it is ongoing, and may become subject to a duty to correct if it in fact becomes misleading. A duty to correct can be found in the federal securities laws: offering materials must be correct and non-misleading at the time of sale, not just at the time they are written, and a duty to correct the materials continues as long as does the offering. See, e.g., Ackerman v. Schwartz, 947 F.2d 841, 848 (7th Cir.1991). The provision of ERISA which requires the publication and distribution of an accurate summary plan description, 29 U.S.C. § 1022(a)(1), when taken in conjunction with the fiduciary duties of the employer, 29 U.S.C. § 1104(a), imposes an analogous duty to correct upon an employer if and when the employer knows or should know that a statement in a Summary Plan Description has become misleading to potential participants. The time period in which the duty to correct continues would be the time in which employees may still choose to participate in the relevant plan. Just as offering materials must be correct and non-misleading under the securities laws during the time of offering, Summary Plan Descriptions should remain accurate and non-misleading throughout the availability of a plan. 39 A court should analyze not only potentially misleading oral representations but also the possible duty to correct an ongoing written representation as of the time of serious consideration.