Opinion ID: 2998260
Heading Depth: 2
Heading Rank: 1

Heading: Claims Based on the March 2002 Amendments

Text: We review de novo the district court’s grant of summary judgment. Ruttenberg v. United States Life Ins. Co., 413 F.3d 652, 658-59 (7th Cir. 2005). Nos. 03-4023 & 04-1375 11
According to ERISA’s so-called “anti-cutback rule,” “[p]lan amendments are permitted . . . , but an amendment may not decrease benefits that have already accrued.” Heinz v. Cent. Laborers’ Pension Fund, 303 F.3d 802, 804 (7th Cir. 2002). The rule derives from 29 U.S.C. § 1054(g)(1), which provides that “[t]he accrued benefit of a participant under a plan may not be decreased by an amendment of the plan.” “Accrued benefit” means, “in the case of a defined benefit plan, the individual’s accrued benefit determined under the plan and . . . expressed in the form of an annual benefit commencing at normal retirement age.” Id. § 1002(23). Furthermore, the statute provides that “a plan amendment which has the effect of . . . eliminating or reducing an early retirement benefit or a retirement-type subsidy . . . with respect to benefits attributable to service before the amendment shall be treated as reducing accrued benefits.” Id. § 1054(g)(2); see also Ahng v. Allsteel, Inc., 96 F.3d 1033, 1034 (7th Cir. 1996) (determining that early retirement benefits are “accrued benefits” within the meaning of ERISA). The plaintiffs argue that the March 2002 amendments violate the anti-cutback rule because Section 4.13(e) of the New Pension Plan allows the Pension Fund to recover a greater amount of benefits paid in error than was allowed under Section 4.13(a) of the Old Pension Plan. Specifically, they argue that their accrued benefits are being reduced because the offset allowed by New Pension Plan Section 4.13(e) makes it more difficult to receive the payments. The Pension Fund, on the other hand, contends that the Old Pension Plan permitted precisely the same recovery of wrongfully paid benefits that is allowed under the New Pension Plan. In our view, the March 2002 amendments did not change a participant’s entitlement to benefits under the plan. Both 12 Nos. 03-4023 & 04-1375 the Old Pension Plan and the New Pension Plan suspend a pensioner’s benefits in any month in which he engages in prohibited reemployment. As well, both Old Pension Plan Section 4.13(c) and New Pension Plan Section 4.13(b) allow the Pension Fund to suspend benefits payments when a pensioner fails to certify that he has not been working in prohibited reemployment or when he fails to provide requested information about his employment activities. Moreover, both before and after the March 2002 amendments, the plan permitted the Pension Fund to recover any benefits that had been paid in error. The result—that the Pension Fund can recover benefits paid in error—is the same despite the fact that the Old Pension Plan simply stated that the Trustees had “the right to recover” “benefit payments exceeding the amount determined by the provisions of [the] Pension Plan” that were “made . . . due to mistake,” R.68, Ex.D at 69, whereas the New Pension Plan authorizes “restitution” of payments that the pensioner “was not entitled to receive,” according to the schedule set forth in Section 4.13(e), R.68, Ex.H at 64. The March 2002 amendments do not make ineligible for benefits any person who would have been eligible prior to the changes. The amendments simply prevent a pensioner from receiving a windfall to which he has no right. This reading is consistent with pre-2002 Pension Fund SPDs that emphasized recoupment as a possibility if benefits are paid in error. For instance, an SPD issued in 2000 and provided to participants in the Pension Fund stated: “If you are working in Prohibited Reemployment your pension benefits will be suspended until you stop working. Additionally, your future benefits may be reduced to reimburse the Plan for any benefits improperly paid to you while you worked in Prohibited Reemployment.” R.98, Ex.C at 28 (emphasis in original). In light of all the evidence Nos. 03-4023 & 04-1375 13 which we have reviewed, we conclude that the March 2002 amendments, as they relate to recoupment of wrongfully paid benefits, violate neither the plain wording nor the 3 purpose of the anti-cutback rule.