Court Opinion

ID: 19854
Source: CourtListenerOpinion
Date Created: 2010-04-25 07:28:35+00
Date Added: 2024-06-11T11:00:03.300552
License: Public Domain

UNITED STATES COURT OF APPEALS
                       FOR THE FIFTH CIRCUIT

                               No. 98-11158

      LOCKHEED MARTIN VOUGHT SYSTEMS CORPORATION, Formerly
known as Loral Vought Systems Corporation; COMMITTEE OF
LOCKHEED MARTIN VOUGHT SYSTEMS CORPORATION RETIREE GROUP
HEALTH PLANS, Formerly known as the Committee of Loral
Vought Systems Corporation Retiree Group Health Plans,

                       Plaintiffs - Counter Defendants - Appellees,

                                  VERSUS
   JOHN MOLLICK, Individually and as Representative of a Class
of persons Similarly Situated; THOMAS D. FIELD, JR., Individually
and as Representative of a Class of Persons Similarly Situated;
ROBERT L. LIDDELL, Individually and as Representativeof a Class of
Persons Similarly Situated; LTV RETIREES ASSOCIATION,

                       Defendants - Counter Claimants - Appellants.

           Appeal from the United States District Court
                for the Northern District of Texas
                               (95-CV-807)
                          February 11, 2000
Before DUHE’, BARKSDALE and DENNIS, Circuit Judges.

PER CURIAM:*

     Defendant-Appellants appeal from the district court’s summary

judgment   rejecting   their     counter-claims   and   declaring   that

Plaintiff-Appellees, by enacting and implementing amendments to

retiree group health plans, did not violate the Employee Retirement

Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001, et. seq,

or exercise rights or powers precluded by the Frost Amendment, Pub.

     *
      Pursuant to 5TH CIR. R. 47.5, the court has determined that
this opinion should not be published and is not precedent except
under the limited circumstances set forth in 5TH CIR. R. 47.5.4.
L. No. 102-484, § 839, 106 Stat. 2315 (1992), the asset purchase

agreement, or the doctrine of estoppel.                 Appellants raise four

points of controversy on appeal, viz., whether: (1) the health plan

amendments    violated   the    terms    of    the    ERISA   plans;    (2)    the

amendments    violated   Plaintiff-Appellees’           fiduciary     duties    to

Defendant-Appellants     as     plan    administrators;        (3)    Plaintiff-

Appellees were equitably estopped from enacting the amendments; or

(4)   the   Frost   Amendment   amended       ERISA    to   prevent   Plaintiff-

Appellees from enacting the health plan amendments.              After careful
review and consideration of the record and the parties’ written and

oral arguments on appeal, we affirm for substantially the same

reasons assigned by the district court in its order and opinion.

      With respect to the first issue, it is well-settled that

welfare plans do not vest under ERISA and that they may be amended

at the employer’s discretion unless the Summary Plan Description

(“SPD”) clearly and expressly limits that right.                  See Fallo v.

Piccadilly Cafeterias, Inc., 141 F.3d 580, 583 (5th Cir. 1998); Wise

v. El Paso Natural Gas Co., 986 F.2d 929, 935 (5th Cir. 1993) cert.

denied 510 U.S. 870 (1993).       We agree with the district court that
under the law and the undisputed material facts, the Plaintiff-

Appellees’    actions    did    not     violate       any   clearly    expressed

limitations or fail to fulfill any stipulated condition.

      With respect to the second issue raised, it is well-settled

that although Congress has authorized employees of an employer

company to serve as plan fiduciaries, the employer is not acting in

a fiduciary capacity when amending an ERISA welfare plan.                      See

Grindstaff v. Green, 133 F.3d 416, 424 (6th Cir. 1998); see also
Izzarelli v. Rexene Prods. Co., 24 F.3d 1506, 1524 (5th Cir. 1994)

(“[An employer] can wear two hats: one as a fiduciary and the other

as the drafter of a plan’s terms . . . [a]n employer does not act

as a fiduciary when it amends or otherwise sets the terms of a

plan.”).   Thus, we agree with the district court that in enacting

the amendments to the health plans, Plaintiff-Appellees did not

violate their fiduciary duty or abuse their discretion.

     With respect to the third issue raised on appeal, this circuit

has not squarely addressed whether an estoppel cause of action is
available under ERISA; we need not resolve this issue, however,

because assuming arguendo that an estoppel cause of action does

exist, we conclude that Defendant-Appellants have not established

such a cause of action.    To recover under an equitable estoppel

theory, a beneficiary must “establish a material misrepresentation,

reasonable and detrimental reliance upon the representation, and

extraordinary circumstances.”     Weir v. Federal Asset Disposition

Assoc., 123 F.3d 281, 290 (5th Cir. 1997) (citing In re Unisys Corp.

Retiree Medical Benefit “ERISA” Litig., 58 F.3d 896, 907 (3rd Cir.

1995)). As the district court correctly concluded, Defendant-
Appellants did not present evidence of oral representations that

could be construed as an interpretation of an ambiguous plan

provision,    and   thus   have    not   established   a   material

misrepresentation sufficient to recover under an ERISA estoppel

cause of action.

     With respect to the fourth issue raised, we agree with the

district court that the Frost Amendment deals solely with existing

and future obligations to pay benefits as determined by the terms
of the plans and did not amend ERISA so as to alter Plaintiff-

Appellees’ rights to amend the terms of such plans.

     For these reasons, and for substantially the same reasons set

forth by the district court, we AFFIRM the judgment of the district

court.