Opinion ID: 504005
Heading Depth: 2
Heading Rank: 1

Heading: Breach of Fiduciary Duty (Count I )

Text: 12 Because the district court dismissed the case on the pleadings, see supra n. 1, we must determine whether in the light most favorable to [the appellants] 'it appears beyond doubt that the [appellants] can prove no set of facts in support of [their] claim which would entitle [them] to relief.'  Paolino v. Channel Home Centers, 668 F.2d 721, 722 (3d Cir.1981) (quoting Conley v. Gibson, 355 U.S. 41, 45, 78 S.Ct. 99, 102, 2 L.Ed.2d 80 (1957)). Our review of an order dismissing a complaint involves a question of law and is therefore plenary. D.P. Enters v. Bucks County Community College, 725 F.2d 943, 944 (3d Cir.1984). 13 In Count I, appellants alleged that they were participants in the VESP plan, and that C-E and the individual defendants breached their fiduciary duties by disclosing the development of VSIP to select employees while at the same time coercing appellants into retirement to prevent them from receiving the greater benefits of VSIP. The district court dismissed the count on the ground that appellants had elected to take retirement under VESP, and that C-E had no fiduciary duty to disclose information about VSIP because it was only in the planning stages at the time of [appellants'] retirement. J.A. at 6. However, the district court did not address the question whether C-E breached a fiduciary duty by revealing the development of the VSIP to certain employees but not appellants. On appeal, appellants raise two questions pertaining to the dismissal of Count I, only one of which requires discussion, namely, were appellants participants in VESP for the purposes of standing? 14 Under ERISA Sec. 502(a)(2), 29 U.S.C. Sec. 1132(a)(2), a civil action for the breach of a fiduciary duty may be brought by the Secretary of Labor or a plan participant, beneficiary or fiduciary. Similarly, ERISA Sec. 502(a)(1), 29 U.S.C. Sec. 1132(a)(1), restricts civil actions against a plan administrator to actions brought by a participant or beneficiary. The requirement that the plaintiff be a plan participant is both a standing and subject matter jurisdictional requirement. Molnar v. Wibbelt, 789 F.2d 244, 247 (3d Cir.1986); Stanton v. Gulf Oil Corp., 792 F.2d 432, 434 (4th Cir.1986). 15 ERISA Sec. 3(7) defines participant to include: 16 any employee or former employee of an employer, or any member or former member of an employee organization, who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer or members of such organization, or whose beneficiaries may be eligible to receive any such benefit. 17 29 U.S.C. Sec. 1002(7). C-E contends that appellants do not qualify as participants in the VESP because they have received all of the benefits to which they are entitled under the VESP plan in a lump sum. We agree. 18 As a general rule, employees who take early retirement and elect to receive lump sum retirement benefits do not have standing to seek the increased payment later made to retirees or to challenge changes in the retirement plan. See Kuntz v. Reese, 785 F.2d 1410 (9th Cir.), cert. denied, --- U.S. ----, 107 S.Ct. 318, 93 L.Ed.2d 291 (1986); Yancy v. American Petrofina, Inc., 768 F.2d 707 (5th Cir.1985); Joseph v. New Orleans Elec. Pension & Retirement Plan, 754 F.2d 628 (5th Cir.), cert. denied, 474 U.S. 1006, 106 S.Ct. 526, 88 L.Ed.2d 458 (1985). Appellants respond that because they all are receiving on-going pension benefits under the Corporate Plan in addition to the lump sum payments received under VESP, they are participants in VESP. However, in order to have standing here, appellants must allege that they are participants in VESP, not in the underlying corporate pension plan. VESP consisted entirely of a lump sum payment to employees, based on the number of years of employment. See supra p. 668 with note 2. The Corporate Plan was a separate pension plan that existed before VESP was offered and that has continued after VESP expired. Thus, although the appellants are participants in the Corporate Plan, they no longer are participants in the VESP. We will therefore affirm the order of the district court dismissing appellants' Count I. 19 We turn next to the heart of appellants' complaint, that such actions amounted to an attempt to interfere with appellants' rights to future benefits in VSIP in violation of ERISA Sec. 510, 29 U.S.C. Sec. 1140.