Court Opinion

ID: 9488863
Source: CourtListenerOpinion
Date Created: 2023-08-05 12:57:44.71996+00
Date Added: 2024-06-11T17:53:08.998739
License: Public Domain

*1486PHILLIPS, Senior Circuit Judge,
concurring in part and dissenting in part:
I dissent from that part of the judgment which affirms dismissal of Stiltner’s claim of discriminatory retaliation under ERISA § 510, and from Part V of the majority opinion which deals with that claim. Otherwise, I concur.
I would hold, contrary to the majority, that Stiltner’s § 510 retaliation claim should not have been dismissed by summary judgment.
I
The dispute giving rise to this claim had its origins in times of apparently exemplary employment relations between Stiltner and Beretta. Stiltner, obviously a good and respected employee, had fallen on hard times with a first heart attack that forced him into intermittent work, then another attack four months later that put him in the hospital and out of work for good. While he was hospitalized, Beretta actively sought to help him through the economic difficulties brought on by his illness. The company first helped him process a claim for long-term disability benefits -with the insurer of its disability-benefit plan. When the insurer initially denied the claim, Beretta urged the insurer to reconsider. During this time, Beretta continued to pay Stiltner his full salary for several months until he began to receive social security disability benefits. And, finally, although Beretta’s separate group health insurance plan provided that its coverage normally would end when an employee stopped active work on a full time basis, Beretta kept Stiltner’s coverage in force by paying the premiums while his claim for disability benefits was pending. Beretta was still paying them when, two years after Stiltner stopped work, the insurer finally denied his disability benefits claim on the basis of a pre-existing condition exclusion.
At this point, the good relations between Stiltner and Beretta began to sour. Taking the position that Beretta was liable to him under his employment contract and Beretta’s ERISA-covered disability plan for the disability benefits its plan insurer had refused to pay, Stiltner, through counsel, made a formal written demand upon Beretta for over $330,000. When Beretta refused to pay, Stiltner notified Beretta that he intended to assert an ERISA legal claim for the disability benefits, and offered to settle that claim for around $332,000. Beretta responded by letter in which it denied any legal obligation to pay the disability benefits, but offered to settle Stiltner’s claim by paying him a lump sum of $3,000 and continuing to pay his health insurance premiums for another eighteen months, in return for Stiltner’s release of Beretta from all claims of liability for the disability benefits. Critically, Beretta’s letter threatened that if Stiltner did not accept its counteroffer by a certain date, Beretta would “terminate all payments, whether for health insurance or for any other cause, on [Stiltner’s] behalf.”
After Stiltner had refused this offer and brought this action, Beretta followed through on its threat and ceased paying premiums on Stiltner’s group health insurance plan.
Stiltner’s action included the § 510 retaliation claim here in issue. This claim, based on the provision in § 510 which makes it unlawful for an employer “to ... discriminate against a participant or beneficiary [in an ERISA plan] for exercising any right to which he is entitled under [ERISA or an ERISA plan],” alleged such discrimination in Beretta’s ceasing to pay the premiums on Stiltner’s health insurance policy in promised reprisal for his threatening, then bringing, legal action to recover the disability benefits. Both the district court and the en bane majority rightly have recognized that this provision of § 510 is effectively an “anti-retaliation” provision of the type found, inter alia, in § 8(a)(3) of the National Labor Relations Act (NLRA).1 But, both courts then concluded that Stiltner’s retaliation claim failed as a matter of law on the summary judgment record: the district court, primarily because it thought § 510 retaliatory-discrimination must involve disparate treatment — not pres*1487ent here — of comparably situated persons, J.A. 7,126-29; the en banc majority, because it thinks the termination of “gratuitously”extended benefits cannot under any circumstances constitute retaliatory-discrimination under ERISA § 510, ante at 13 (“ERISA § 510 does not preclude an employer from revoking gratuitous benefits”); 17 (anti-retaliation “policy has no application when the benefits at issue are merely gratuitous”). By these different holdings, the district court may have accepted that gratuitous benefits might be the subject of the § 510 retaliatory-discrimination, but only if disparate treatment were involved, while the en banc majority apparently accepts that § 510 retaliatory-discrimination may involve singular (not disparate) forms of adverse treatment, but that the revocation of “gratuitous” benefits is not such a form. I think both are wrong in their interpretation of the intended reach of this anti-retaliation provision. Because I would reverse the district court’s holding, but on grounds that also reject the en banc majority’s interpretation, I address each in turn.
II
Neither the literal text nor the legislative history of ERISA defines what it means to “discriminate against” a plan participant or beneficiary for purposes of the anti-retaliation provision of § 510. Specifically, neither speaks to whether, as the district court held, only disparate treatment can qualify. The legislative history of § 510 does indicate, however, that it was patterned on the anti-retaliation provision, § 8(a)(3), of the National Labor Relations Act (NLRA) in vital respects. See 119 Cong. Rec. 30374, reprinted in Subcomm. on Labor of the Senate Comm, on Labor and Public Welfare, Legislative History of the Employee Retirement Income Security Act of 1974, Pub.L. No. 93-406 (Comm.Print 1976), at 1774-75 (remarks of Senator Hartke) (“[Section 510’s] language parallels section 8(a)(3) of the National Labor Relations Act.”). For this reason, the courts properly have looked to the § 8(a)(3) precedents in interpreting various aspects of the parallel anti-retaliation provision of § 510. See, e.g., West v. Butler, 621 F.2d 240, 245 & nn. 4-5 (6th Cir.1980); Newton v. Van Otterloo, 756 F.Supp. 1121, 1135-37 (N.D.Ind. 1991). Guidance on the question of what it means to “discriminate against” under § 510 may be found in this way.
Section 8(a)(3) of the NLRA makes it an unfair labor practice for an employer to encourage or discourage membership in any labor organization “by discrimination in regard to hire or tenure of employment or any term or condition of employment.” 29 U.S.C. § 158(a)(3) (emphasis added). It is well-established that the concept of “discrimination” under this section is not limited to disparate treatment of similarly situated employees, but includes any adverse action taken against one or more employees because of their decision to engage in protected activities. F. Bartosie & R. Hartley, Labor Relations Law in the Private Sector 114 (2d ed. 1986); see Midstate Telephone Corp. v. N.L.R.B., 706 F.2d 401, 406 (2d Cir.1983) (any action taken against an employee that “attache[s] a penalty to [protected] activity” is “discriminatory” within the meaning of § 8(a)(3)); N.L.R.B. v. Borden, Inc., 600 F.2d 313, 320 (1st Cir.1979); N.L.R.B. v. Jemco, Inc., 465 F.2d 1148, 1152 (6th Cir.1972), cert. denied, 409 U.S. 1109, 93 S.Ct. 911, 34 L.Ed.2d 690 (1973). Retaliatory “discrimination” lies not in the fact that the employer is treating the employee less favorably than other similarly situated employees, but in the fact that it is treating him less favorably than it would have treated him had he not engaged in the protected activity. See Jemco, 465 F.2d at 1152 (“[The] discrimination ... lies in the employment benefit [being] afforded to [the employee] prior to [his] engaging in a [protected] activity,” but “denied to [him] after [he] engaged in such an activity.”). Disparate treatment in this regard may of course be persuasive evidence of “discrimination” within the intended meaning of § 8(a)(3), but it is not an essential prerequisite to a finding of such discrimination. See Borden, 600 F.2d at 320. As the Sixth Circuit has explained, a contrary holding “would lead to the somewhat absurd result that an employer could never be found in violation of [section 8(a)(3)] so long as he was careful to treat all [similarly situated] employees alike, no matter how destructive *1488of employee rights his conduct may be.” Jemco, 465 F.2d at 1152.
The same interpretive reasoning applies to the anti-retaliation provision of ERISA § 510. Like NLRA § 8(a)(3), that provision is not designed to require employers to treat all persons under the base-statute’s protections alike, but simply to prevent employers from using economic leverage to discourage certain activity by those persons that Congress wanted to protect. See Owens v. Storehouse, Inc., 984 F.2d 394, 398 (11th Cir.1993) (“[Section 510] does not broadly forbid all forms of discrimination” in employment benefits, only discrimination “designed to retaliate for the exercise of a right or to interfere with the attainment of an entitled right.”).
This interpretation of the term “discriminate” in § 510’s anti-retaliation clause is also consistent with the established interpretation of the same term in similar anti-retaliation provisions in other federal employment statutes. Both Title VII and the Age Discrimination in Employment Act contain provisions that make it unlawful for an employer to retaliate against individuals for attempting to enforce those statutes against it.2 Like § 510, both of these provisions forbid employers to “discriminate against” individuals for engaging in certain protected activity, but do not define the phrase “discriminate against.” Both are consistently interpreted, however, to forbid an employer to take any kind of adverse action against an individual because he has engaged in the protected activity, even in the absence of evidence that it has treated him less favorably than other similarly situated individuals. See, e.g., Passer v. American Chem. Soc., 935 F.2d 322, 331-32 (D.C.Cir.1991) (employer’s cancellation of special symposium in employee’s honor could constitute actionable “discrimination” under ADEA’s anti-retaliation clause, where done with specific intent to retaliate against him for asserting age discrimination claim against it); Ross v. Communications Satellite Corp., 759 F.2d 355, 365 (4th Cir.1985) (any “adverse employment action”). Because the anti-retaliation provision at issue here uses the same “discriminate against” language as those other provisions, and was enacted after them, we may presume that Congress intended it to have the same basic meaning. See Kimbro v. Atlantic Richfield Co., 889 F.2d 869, 881 (9th Cir.1989) (looking to case law under Title VU’s anti-retaliation provision for guidance in interpreting § 510’s anti-retaliation provision), cert. denied, 498 U.S. 814, 111 S.Ct. 53, 112 L.Ed.2d 28 (1990). See generally Cannon v. University of Chicago, 441 U.S. 677, 696-99, 99 S.Ct. 1946, 1957-59, 60 L.Ed.2d 560 (1979).
I would therefore hold, at odds with the district court, that the mere fact that Beretta’s termination of health insurance premium payments did not involve disparate treatment in relation to comparably situated other plan beneficiaries did not defeat Stiltner’s anti-retaliation claim as a matter of law.
Ill
As earlier indicated, in affirming the district court’s dismissal by summary judgment of Stiltner’s § 510 retaliation claim, the en banc majority does not rely, as did the district court, on the notion that an employer cannot “discriminate against” an ERISA plan participant or beneficiary for retaliatory purposes except by disparate treatment in relation to comparably-situated others. The court instead affirms on the basis that an employer does not “discriminate against” a plan participant or beneficiary by revoking “gratuitously” extended benefits even if for retaliatory purposes. See ante at 1482 (issue stated as “whether, under ERISA § 510, an employer can ‘discriminate against an employee [sic] by revoking a gratuitous benefit’”); 17 (holding stated as being “that *1489ERISA § 510 does not prohibit the revocation of gratuitously provided benefits”).
Such a narrow interpretation of the intended meaning of the phrase “discriminate against” in application of § 510’s anti-retaliation provision is simply wrong. It is not dictated by the statutory text nor by § 510’s legislative history and it is wholly at odds with the clear purpose of this and related anti-retaliation provisions.
As the en banc majority concedes, the statutory text is ambiguous on the question whether an employer can “discriminate against” a plan participant or beneficiary in violation of § 510’s anti-retaliation provision by revoking “gratuitously”-provided benefits. Ante at 1482. And, as the court also concedes, § 510’s legislative history gives no express guidance on the question. Ante at 1482. Nor is there any direct circuit interpretive precedent available. We therefore have only the bare text, “discriminate against a participant or beneficiary for exercising any right to which he is entitled under [ERISA or an ERISA plan]” and the general purposes of this and comparable anti-retaliation provisions as that may be revealed in legislative history and judicial interpretations of such comparable provisions.
Though the statutory text is ambiguous on the specific question, two aspects of the full text are critical in assessing the general purpose of § 510’s anti-retaliation provision. The first is that the class protected from retaliatory action is that of plan “participants and beneficiaries,” a class that is not limited to current employees. The second is that the term “discriminate against” is facially open-ended. As developed in Part II of this opinion, it is not limited to conduct involving disparate treatment. Nor is it otherwise expressly or implicitly qualified or limited by its context. Hence, as written, it appears to signify any form of significant adverse action against a protected person taken for retaliatory purposes.
That this is the intended broad meaning is borne out by the legislative history which indicates that the purpose of § 510’s anti-retaliation provision was to prevent employers who maintain ERISA plans from using economic leverage to intimidate participants and beneficiaries under those plans from exercising their ERISA given rights to enforce the plans’ terms. See S.Rep. No. 93-127, 93d Cong., 2d Sess. (1973), reprinted in 1974 U.S.Code Cong. & Admin.News 4838, 4872 (Section 510 was enacted “in the face of evidence that in some plans a worker’s pension rights or the expectations of those rights were interfered with by the use of economic sanctions). If what is being prohibited is the use by ERISA-plan employers of any form of economic leverage calculated to chill or prevent exercise of ERISA-given rights, it must be a matter of no consequence that the subject of the leverage might be a benefit that has been “gratuitously” provided. What is prohibited is coercion by economic leverage, and this may as well be effected by conditioning the continuance of a “gratuity” on foregoing the exercise of a protected right as by terminating a presumably otherwise enforceable benefit. Indeed, given the added risk of doing the latter, coercion by the conditioned-carrot method might be the more tempting device, hence one as surely contemplated by the statute.
This interpretation — that prohibited retaliatory discrimination under § 510 may be effected by terminating “gratuitous” benefits — finds support in decisions so interpreting the ADEA’s comparable anti-retaliation provision, 29 U.S.C. § 623(d). See Passer v. American Chemical Society, 935 F.2d 322, 330-31 (D.C.Cir.1991) (employer’s cancellation of special symposium honoring claimant in retaliation for exercising protected right under ADEA actionable under anti-retaliation provision, notwithstanding a “mere gratuity”); Cohen v. S.U.P.A., Inc., 814 F.Supp. 251, 259-61 (N.D.N.Y.1993) (employer’s retaliatory termination of health benefits being gratuitously provided to laid-off employee actionable under ADEA’s anti-retaliation provision).
IV
Presumably because of the considerations just discussed, no court, so far as I am aware, has until now held that an employer’s retaliatory cutting off of “gratuitously”-pro*1490vided benefits cannot ever be found a violation of § 510’s anti-retaliation provision.
The en banc majority purports to find such decisions in two sources, but both are flatly inapposite.
First, the court relies on two decisions, NLRB v. Electro Vector, 539 F.2d 35 (9th Cir.1976), and NLRB v. Wonder State Mfg. Co., 344 F.2d 210 (8th Cir.1965), which, construing § 8(a)(3) of the NLRB, have held that an employer’s retaliatory withholding of “gifts” does not violate that particular anti-retaliation provision. While, as indicated, it is quite proper to rely on decisions interpreting provisions of § 8(a)(3) that are comparable to those in § 510, ante at 1483, these decisions do not do that. Section 8(a)(3) expressly limits the retaliatory employer conduct that it prohibits to “discrimination in regard to hire or tenure of employment or any term or condition of employment.” 29 U.S.C. § 158(a)(3) (emphasis supplied). These decisions are simply, and properly, pointing out that “gifts” (unless they have been regularized to the status of entitlements) are not “conditions of employment,” hence not prohibited means of retaliation under § 8(a)(3). But, § 510 contains no such express or implicit limitation or qualification on the kinds of retaliatory discrimination that it prohibits. Nor is its protection limited, as necessarily is that of § 8(a)(3), to employees. These § 8(a)(3) decisions therefore do not speak at all to the issue whether § 510 prohibits the retaliatory revocation of “gifts” or “gratuities” to ERISA-plan participants and beneficiaries.
The other decisions relied upon by the en banc majority, Haberern, 24 F.3d 1491, McGath, 7 F.3d 665, and Woolsey, 934 F.2d 1452, are equally inapposite — for the same general reason. Each, interpreting the discriminate-by-interference-with-attainment-of-benefits prong of § 510, holds that discrimination for that prohibited purpose can only be effected by conduct that affects “the employment relationship.” None, as indicated, is interpreting the anti-retaliation prong of § 510 whose meaning is here in issue. The attainment-of-benefits prong that they are applying is, by definition, limited to employer conduct that affects employee participants and beneficiaries of ERISA plans by preventing their “attainment” of ERISA benefits. As to that particular prohibition, these decisions are simply making one of two points: that the specific evil at which it was aimed was purposeful manipulation of the employment relationship itself as a way of preventing employees from attaining ERISA benefits, e.g. Haberern, 24 F.3d at 1503 (“protects plan participants from termination motivated by an employer’s desire to prevent a pension from vesting”), or that it could not be interpreted to apply to plan amendments alone because of an employer’s right as set-tlor to change its terms, e.g. Woolsey, 934 F.2d at 1461 (plan alternation alone not actionable even if done by disparate treatment).
Neither of these necessary limitations on conduct that can be considered discrimination under the attainment-of-benefits prong of § 510 has any application to the intended reach of the anti-retaliation provision. The anti-retaliation provision is not concerned only with employees, nor at all with the attainment of benefits; nor can its application in any way interfere, if not limited, with employers’ unilateral rights to amend their plans. In consequence, these interfere-with-attainment decisions have nothing to say about whether an employer can discriminate against a plan participant or beneficiary by cutting off “gratuitous” benefits for the exercise of ERISA-given rights.
V
The only other basis for the en banc court’s reading of a “gratuitous-benefit” limitation into § 510’s anti-retaliation provision is what it considers the adverse public policy consequences of failing to do so. The court asserts that unless “gratuitous” benefits are excepted, benign employers (presumably in significant numbers) will be chilled from private acts of charity, while equally numerous ungrateful plan participants will be able to convert mere charitable gratuities into legal entitlements. Ante at 1483. Those consequences, says the court, must surely not have been intended by Congress, so that an intention to avoid them must be read into the *1491statute to give effect to that unexpressed legislative intent.3
Laying aside any skepticism one might have about how much of private-charity impulses are actually at any risk in this area, there are firm reasons for rejecting the court’s public policy concerns and the related implications of Congressional intent. The first, and most obvious, is that if these twin risks — of widespread frustrations of employer altruism and unjust rewarding of undeserving ERISA-plan participants — had seemed as significant to Congress as the court assumes them to be they easily could have been avoided by simple statutory drafting that did not occur. My hunch is that Congress never thought of any such policy concerns or that, if it did, it thought them too negligible to the overall operation of ERISA to warrant any attention. Certainly it never mentioned them. The plain fact is that ERISA, on its face, and so far as its legislative history reveals, is simply indifferent to the question whether employers should go beyond the law and engage in private acts of charity to ERISA-plan participants.
Furthermore, to ascribe such weight as the court does to these concerns of possible injustices in individual cases completely misreads the fundamental purpose of this and comparable anti-retaliation provisions. They are not enacted with an eye to the relative moral worth of individual employers and those who inspire them to retaliatory action. Their fundamental purpose is in terrorem: to impose a general deterrence upon the impulse of employers to retaliate for the exercise of statutory rights against their perceived interests. Sad though it be as a commentary on human nature, it is a fact of consequence that Congress has found the retaliatory impulse sufficiently widespread and sufficiently a threat to their intended operation that it has considered anti-retaliation provisions necessary to secure the integrity of all the major employment-relations statutory schemes of recent history — the NLRA, Title VII, the ADEA, and ERISA.
To read a gratuitous-benefit limitation into this anti-retaliation provision is flatly at odds with that general deterrent purpose. For that further reason, it is not warranted as a judicial gloss on the statute.
VI
One final point deserves mention. It concerns the precedential effect of the court’s statutory interpretation. That interpretation effectively defines the “gratuitous benefit” whose retaliatory revocation is shielded from liability as broadly including any the employer “had no duty” to provide. Ante at 1485.4
Under that interpretation, it would be of no consequence that a particular provision of benefits, though not legally obligatory, was, however, motivated wholly or to a substantial degree by provable economic self-interest rather than pure altruism. A purpose, for *1492example, to retain the services of an employee with skills not replaceable at acceptable relative expense in the market; or a legally counselled effort to avoid possible liability because there might be a contractual obligation later determined not to exist; or a desire, because of troubled employment relations, simply to make a gesture that might return greater economic benefits than those conferred; and so on.
Though it would still, in my view, have been an unwarranted exercise in statutory interpretation, the court would at least have been nearer its professed aim of encouraging (or not discouraging) private charity on the part of employers if it had required a purer variety than simply “not compelled by duty.” Tax law, in a not unrelated setting, might have provided a model in its definition of that which constitutes a “gift” for tax purposes. Concerned precisely with the difficulty of discerning raw economic self-interest behind ostensible “gifts” of one sort or another, tax law hit upon “detached and disinterested generosity” as the distinguishing mark of the true “gift.” See Commissioner of Internal Revenue v. LoBue, 351 U.S. 243, 246, 76 S.Ct. 800, 803, 100 L.Ed. 1142 (1956). Who knows how Stiltner’s claim, for example, might have fared under such a definition? Because it clearly fails as a matter of law under the court’s doubly-unwise interpretation, we will never know. We do know, however, that in this circuit from now on employers may with impunity retaliate against ERISA-plan participants who exercise statutory rights against their perceived interests by cutting off any benefits being provided them, for whatever reason, just so long as they are not legally enforceable obligations.
VII
Because it is undisputed that Beretta ceased paying Stiltner’s insurance premiums in specifically promised retaliation for his exercise of an ERISA-given right to press a claim against Beretta, this constituted discrimination in violation of § 510’s anti-retaliation provision as a matter of law. The fact that this did not involve disparate treatment in relation to others, and the fact that Beretta was not legally obligated to pay the premiums are irrelevant to application of § 510’s anti-retaliation provision. Accordingly, I would vacate the district court’s dismissal of Stiltner’s § 510 retaliation claim and remand for award of an appropriate remedy.
I am authorized to state that Chief Judge ERVIN, Judge HALL, Judge MURNAGHAN and Judge MICHAEL join in this concurring and dissenting opinion.

. In so doing, both courts properly have rejected Beretta's first line of defense: that § 510 does not in this provision prohibit retaliation as a form of "discrimination.” See Appellee’s Br. 29-36.

. See 42 U.S.C. § 2000e-3(a) (making it unlawful for employer "to discriminate against any of his employees ... because he has opposed any practice made an unlawful employment practice by [Title VII] ... or ... made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or hearing under [Title VII]”) (emphasis added); 29 U.S.C. § 623(d) (making it unlawful for employer “to discriminate against any of his employees ... because such individual ... has opposed any practice made unlawful by [the ADEA] ... or ... has made a charge, testified, assisted, or participated in any manner in an investigation, proceeding, or litigation under [the ADEA]”) (emphasis added).

. The court actually goes beyond this and asserts that ERISA somehow reflects an affirmative "public policy of encouraging employers to offer employees gratuitous benefits,” a policy which, it says, is supported by its decision but would be thwarted by allowing the termination of such benefits to be the subject of § 510 anti-retaliation claims. Ante at 1484. There is no support in either ERISA’s text or in its legislative histoiy for the proposition that it embodies or reflects any such affirmative public policy. The court cites passages from three opinions of sister circuits as supporting its assertion, id., but none even remotely does so. The statement in Hamilton, 945 F.2d at 79 that "[ejmployers are understandably more willing to provide employee benefits when they can reserve the right to decrease or eliminate those benefits”, expresses no such general policy; it was made in support of a narrow holding that employers can, by appropriate action, reserve such a right. The statement in Owens, 984 F.2d at 398, that "[ajbsent contractual obligation, employers may decrease or increase benefits” was made in the course of upholding the right of employers to amend a plan when that right is properly reserved; it intimated nothing about a general policy of encouraging gratuitous benefits. The statement in Leavitt, 921 F.2d at 161-62 that “ERISA is concerned with protecting contractual benefits” was made as an aside in the course of holding that a plan participant may voluntarily settle a breach-of-fiduciary claim under ERISA; neither the holding nor the statement intimate anything about a general ERISA policy favoring gratuitous benefits.

. That this is the specific meaning of "gratuitous” in the court’s interpretation is evident not only from the cited reference, but from its holding that, as a matter of law, the benefits provided Stiltner were "gratuitous” because not contractually or otherwise legally compelled.