Opinion ID: 217949
Heading Depth: 2
Heading Rank: 3

Heading: Effect of the 2005 Resolution: Claim 3 of the SAC.

Text: Claim 3 of the SAC alleges that the 2005 Resolution did not effectively amend the Plan because it was not adopted and incorporated into the Plan Documents. 5 Aplt.App. 981. Qwest moved for summary judgment, arguing that the 2005 Resolution sufficiently manifested Qwest's intent to amend the Plan or, in the alternative, that Qwest ratified the amendment by its subsequent actions. See 6 Aplt.App. 1184, 1191. The district court granted the motion, holding that Qwest's actionsspecifically, approving the 2005 Resolution, sending out notices of the changes to plan participants, and conducting itself in accordance with the 2005 Resolutionsufficiently manifested its intent to amend the Plan under Curtiss-Wright. See Kerber, 2009 WL 928329, at -6. Further, the court held that the 2005 Resolution was adopted within the meaning of the Prior Loss Proviso before January 1, 2006. Id. at . On appeal, Plaintiffs argue that the district court erred in several respects. First, Plaintiffs argue that the 2005 Resolution did not amend the Plan because the Resolution is unclear as to its effect and does not use the word adopt, as, they argue, is required by the Prior Loss Proviso. Aplt. Br. 31-33. Second, Plaintiffs argue that Qwest's subsequent ratification of the 2005 Resolution cannot serve as an adoption for purposes of the Prior Loss Proviso, and that the dates on which Qwest either made announcements or mass mailed notices to retirees are irrelevant for purposes of enforcing Plan beneficiaries' rights under the Prior Loss Proviso. Id. at 32. Third, for the first time on appeal, Plaintiffs argue that the 2005 Resolution did not amend the Plan because the Resolution uses the phrase Basic Life Insurance Benefit, not Basic Life Coverage as used in the Plan Documents. Id. at 33. Fourth and finally, Plaintiffs argue that when compared to Amendment 2006-1, a later action by the PDC that purports to formally adopt the 2005 Resolution, the 2005 Resolution's informality and confusing language raises a genuine dispute of material fact as to the effect of the 2005 Resolution. Id. at 36-37. We are not persuaded by Plaintiffs' arguments, and we affirm the district court's grant of summary judgment. The record reveals no genuine dispute that Qwest, through the 2005 Resolution, intended to reduce the life insurance benefits for Post-1990 Retirees to a flat $10,000 benefit. In Curtiss-Wright, the Supreme Court held that a reservation of rights clause similar to the one in this case provided a procedure for amending an ERISA plan. 514 U.S. at 81, 115 S.Ct. 1223. The Court remanded to the court of appeals to engage in a fact-intensive inquiry, under applicable corporate law principles, into what persons or committees ... possessed plan amendment authority, ... and whether those persons or committees actually approved the new plan provision. Id. at 85, 115 S.Ct. 1223. Accordingly, we must determine whether the PDC possessed plan amendment authority and whether it actually approved the reduced life insurance benefit. Neither party disputes that the PDC had the power to amend the Plan on behalf of the Company. The remaining issue, then, is whether there is a genuine factual dispute whether the PDC actually approved the changes in the 2005 Resolution. Id., 514 U.S. at 85, 115 S.Ct. 1223. Like the district court, we hold that the evidence shows beyond dispute that the PDC approved the changes. Qwest's subsequent actions confirm that the 2005 Resolution actually amended the Plan. First, the 2005 Resolution itself manifests the PDC's intent to amend the Plan. The final sentence of the 2005 Resolution reads: RESOLVED, that the Qwest Group Life Insurance Plan be and hereby is amended and restated to incorporate the design changes approved.  5 Aplt.App. 905 (emphasis added). The Resolution listed three apparent design changes; the one relevant to this appeal states, Change the Basic Life Insurance Benefit for Post-1990 Occupational Retirees to reduce it to a fixed $10,000 benefit effective January 1, 2006. Id. Through this language, the PDC expressed its intent to amend the Plan. It is true that the 2005 Resolution is not altogether unambiguousthe aforementioned changes are styled as recommendations to authorize the Director of Employee Benefits to take all actions appropriate to implement the changes. Id. This ambiguity does not create a genuine dispute of material fact, however. Ultimately the 2005 Resolution amend[ed] and restate[d] the Plan to incorporate the design changes approved. Id. It makes little sense to refer to a recommendation of authorization as a design change; likewise, it is nonsensical to amend[] and restate[] the Plan to incorporate a recommendation authorizing the Director to make changes. Hence, the design changes that were approved and incorporated into the Plan by the 2005 Resolution must be the substantive changes contained thereinincluding the change to a flat $10,000 benefit for Post-1990 Retirees. Accordingly, the PDC actually amended the Plan through the 2005 Resolution. Our conclusion is bolstered by affidavits from the members of the PDC, wherein each member states that he or she intended the 2005 Resolutions to amend the Plan. See 6 Aplt.App. 1218; 7 Aplt.App. 1346-47, 1350. Second, Qwest's subsequent actions confirm that the PDC actually approved the 2005 Resolution, and that the Plan was thereby amended. Following the 2005 Resolution, Qwest sent to all plan participants a SMM, a 2006 Occupational Benefit Program, and a Benefit Enrollment Statement, all of which explained that the life insurance benefit would be reduced to $10,000 as of January 1, 2006. See 7 Aplt. App. 1352, 1367, 1413; see Kerber, 2009 WL 928329, at  (explaining the contents of the Enrollment Statement). Qwest also notified Prudential, the issuer of the group insurance policy, of the changes, and Prudential began to administer the Plan in accord with the 2005 Resolution. See 6 Aplt.App. 1219. Qwest also notified the AUSWR and the United Communications Workers of America of the changes, see id. at 1224; 7 Aplt.App. 1353-54, and Qwest's 2005 year-end 10-K reflected the reduced life insurance benefit, see 7 Aplt.App. 1295. This extensive, undisputed evidence compels the conclusion that Qwest intended the 2005 Resolution to amend the Plan. Accordingly, the district court correctly granted summary judgment to Qwest. Plaintiffs' arguments to the contrary are unavailing. First, we note that Plaintiffs argue for the first time on appeal that the 2005 Resolution was ineffective because it purported to amend the Basic Life Insurance Benefita term not used in the Plan Documentinstead of Basic Life Coverage, the proper term. See Aplt. Br. 33. Because this argument was not presented to the district court and Plaintiffs do not attempt to argue plain error, we will not address it on appeal. See Richison v. Ernest Group, Inc., 634 F.3d 1123, 1128 (10th Cir.2011). But even if Plaintiffs had made that argument below, it would fail because the 2005 Resolution and subsequent actions prove beyond dispute that the PDC actually amended the Basic Life Coverage, regardless of the minor differences in language. Second, given the evidence in favor of Qwest, the fact that the 2005 Resolution styles the changes as a recommendation does not raise a genuine dispute of material fact. Although the recommendation language may be confusing, as we note above a careful reading of the 2005 Resolution reveals that the Resolution approved and incorporated into the Plan Documents the design changes contained in the Resolution, and that those design changes refer to the listed substantive changes. See supra. Further, any ambiguity in the 2005 Resolution was resolved upon issuance of the SMM, Program Guide, and Enrollment Statement, not to mention the notification to Prudential, the AUSWR, and the IRS, as well as the PDC members' affidavits. This overwhelming evidence supporting the conclusion that Qwest, acting through the PDC, actually amended the Plan cannot be overcome by the slight confusion caused by styling the amendment as a recommendation. Third, Plaintiffs argue that the 2005 Resolution did not amend the Plan because there was no decisive action taken either to create a restated Plan document or formally adopt an enabling amendment to the Master Plan Document until December 14, 2006. Aplt. Br. 34-35. However, this argument is beside the point. Neither the procedures for amending the Plan nor the 2005 Resolution require action beyond actual approval of an amendment in order for the amendment to take effect. Qwest merely had to follow the amendment procedure outlined in the RORthat the Company amend the Plan, which in turn requires only (1) that the amending body have the power to do so, and (2) the amending body actually approve the amendment. See 3 Aplt.App. 638; Curtiss-Wright, 514 U.S. at 85, 115 S.Ct. 1223. Because the PDC had the power to amend the Plan, the 2005 Resolution itself effectuated a valid amendment. Qwest's alleged failure to take further actionand, particularly, Qwest's failure to strike inconsistent Plan languageis irrelevant. Finally, the fact that the 2005 Resolution does not use the word adopt is of no consequence. As the district court correctly noted, because the word adopt is not defined in the Plan Documents, we give it the common and ordinary meaning as a reasonable person in the position of the plan participant. Kerber, 2009 WL 928329, at  (internal quotation marks and citation omitted). We also agree with the district court that, in common usage, adopt means to embrace, approve, conform, or to accept and put into effect. Id. Under this definition, an amendment can certainly be adopted without using the word adopt, so long as that amendment is embraced, approved, accepted or put into effect. In this case, the evidence shows that, acting through the PDC, Qwest did indeed approve the 2005 Resolution and put it into effect. See discussion supra. Therefore, the amendments contained in the 2005 Resolution were adopted within the meaning of the Prior Loss Proviso on October 14, 2005. In sum, the evidence produced by Qwest establishes beyond dispute that the 2005 Resolution reduced Post-1990 Retirees' life insurance benefit to a flat $10,000. Therefore, the district court correctly granted summary judgment to Qwest on Claim 3 of the SAC.