Court Opinion

ID: 3013627
Source: CourtListenerOpinion
Date Created: 2015-10-13 21:57:48.687748+00
Date Added: 2024-06-11T11:46:48.069846
License: Public Domain

Opinions of the United
2004 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit

11-10-2004

Depenbrock v. Cigna Corp
Precedential or Non-Precedential: Precedential

Docket No. 03-3575

Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2004

Recommended Citation
"Depenbrock v. Cigna Corp" (2004). 2004 Decisions. Paper 109.
http://digitalcommons.law.villanova.edu/thirdcircuit_2004/109

This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova
University School of Law Digital Repository. It has been accepted for inclusion in 2004 Decisions by an authorized administrator of Villanova
University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.
                       PRECEDENTIAL                Counsel for Appellant

IN THE UNITED STATES COURT OF
            APPEALS                          Joseph J. Costello, Esq. (Argued)
     FOR THE THIRD CIRCUIT                          Tamsin J. Newman
          ____________                          Morgan, Lewis & Bockius
                                                   1701 Market Street
            No. 03-3575                          Philadelphia, PA 19103
           ____________
                                                   Counsel for Appellee
       JOHN DEPENBROCK,                               ____________

              Appellant                        OPINION OF THE COURT
                                                    ____________
                  v.
                                         ROSENN, Circuit Judge.
CIGNA CORP.; CIGNA PENSION PLAN
                                                This case is a by-product of
         ____________
                                         corporate America’s recent effort to curb
                                         costs by, inter alia, scaling back the
Appeal from the United States District
                                         benefits provided under pension plans.
                 Court
                                         John Depenbrock (“Depenbrock”) claims
  the Eastern District of Pennsylvania
                                         that his employer, CIGNA Corporation
        D.C. No.: 01-cv-06161
                                         (“CIGNA”), violated the Employee
 District Judge: Honorable Robert F.
                                         Retireme nt I nc ome Se c ur it y A ct
                 Kelly
                                         (“ERISA”), 29 U.S.C. § 1001, et seq., by
            ____________
                                         denying him benefits without the required
                                         notice and lawful amendment to the
    Argued: September 21, 2004
                                         pension plan. Depenbrock also alleges
                                         that CIGNA violated ERISA by failing to
Before: McKEE, ROSENN and WEIS,
                                         provide him an opportunity to review
           Circuit Judges
                                         pertinent documents relating to his denial-
                                         of-benefits claim, and by breaching the
     (Filed: November 10, 2004)
                                         fiduciary duty owed as plan administrator.
                                                The District Court granted
  Stephen R. Bruce, Esq. (Argued)
                                         CIGNA’s motion for summary judgment
        805 15th Street, N.W.
                                         and denied Depenbrock’s cross motions.
     Washington, DC 20005-2271
                                         We reverse the summary judgment in
                                         favor of CIGNA and remand with
   William M. O'Connell, III, Esq.
                                         directions to enter summary judgment for
    Barbin, Lauffer & O'Connell
                                         Depenbrock.
        608 Huntingdon Pike
                                                              I.
        Rockledge, PA 19046
                                                In 1983, Depenbrock began
working at CIGNA. At that time, CIGNA             benefits.3 In addition, the proposed plan
provided its employees with a generous            amendment included a “Rehire Rule”
traditional pension plan.1 On November 4,         which stated that long-term employees
1997, presumably to cut costs, CIGNA              who left CIGNA and were re-employed
proposed amendments to its plan that were         after December 31, 1997, would not
to become effective January 1, 1998.              participate in the Old Plan upon return but
According to the amendments, younger,             instead would be transferred immediately
short-term employees w ere to be                  into the New Plan. For reasons unknown,
transferred to a more modest “cash                CIGNA did not formally adopt the
balance” pension formula (“the New                amendment and “Rehire Rule” until
Plan”), 2 while long-term employees –             December 21, 1998, when CIGNA’s CEO
such a s D epenbrock –              would         executed a written adoption in accordance
“grandfather” in under the traditional plan       with the amendment procedure set forth in
(“the Old Plan”) and receive higher               the plan.
                                                          On January 2, 1998, Depenbrock
                                                  resigned from CIGNA to work for another
  1
                                                  company. However, Depenbrock was
    A traditional pension plan is a defined       rehired at CIGNA on November 30, 1998.
benefit plan that “pays an annuity based          Depenbrock claims that the pension rule in
on the retiree’s earnings history, usually        effect when he was rehired provided that
the most recent or highest paid years, and        he immediately resume participation under
the number of completed years of service          the Old Plan. Depenbrock bases this
to the company.” Campbell v.                      assertion on the fact that the proposed
BankBoston, N.A., 327 F.3d 1, 4 (1st              amendment to CIGNA’s plan had not yet
Cir. 2003). The CIGNA pension plan                been formally adopted when he was
was determined by factoring in the                rehired on November 30, 1998. Because
retiree’s credited years of service, 2% of        the formal adoption date came twenty-two
his 36-month average compensation at              days after Depenbrock returned to work,
the time of retirement, minus a Social            Depenbrock asserts that the amendment
Security offset.                                  does not apply to him. To hold otherwise,
  2                                               Depenbrock argues, would amount to an
   “Cash balance” plans “guarantee an
                                                  impermissible retroactive reduction of his
employee a certain contribution level,
usually an annual percentage of salary,
plus a fixed percentage of interest.”
Campbell, 327 F.3d at 4. CIGNA’s
                                                    3
“cash balance” plan offered employees                 CIGNA refers to the Old Plan as
an account balance to which was credited          “Part A” and the New Plan as “Part B.”
an amount based on eligible earnings and          We employ the terms “Old” and “New”
credited years of service, as well as an          in order to orient the plans
annual declared interest rate.                    chronologically.

                                              2
rights.4                                          District Court denied Depenbrock’s
        CIGNA counters that although the          motion to compel without offering any
amendment was not formally adopted until          explanation for its finding. The District
December 21, 1998, the announcement of            Court held oral argument on cross motions
the proposed changes on November 4,               for summary judgment and on July 31,
1997, coupled with the CEO’s conduct              2003, issued an opinion and order granting
subsequent to the announcement, served to         s u m m a r y j u d g m e n t to C IG N A .
implement and retroactively ratify the            Depenbrock timely appealed.
amendment as of November 4, 1997. As                                     II.
such, CIGNA asserts that the effective                    This case having arisen under
date of the amendment was January 1,              ERISA, the District Court had subject
1998 – the effective date specified in the        matter jurisdiction pursuant to 28 U.S.C. §
internal announcement of the amendment.           1331 and 29 U.S.C. § 1132. This Court
Because Depenbrock resigned from                  has appellate jurisdiction pursuant to 28
CIGNA on January 2, 1998, one day after           U.S.C. § 1291 over the final judgment of
the specified effective date of the “Rehire       the District Court. Berger v. Edgewater
Rule,” CIGNA contends the “Rehire Rule”           Steel Co., 911 F.2d 911, 916 (3d Cir.
lawfully applies.                                 1990).
        Depenbrock filed suit against                     We review de novo the District
CIGNA in the Eastern District of                  Court’s order granting CIGNA’s motion
Pennsylvania on December 11, 2001, for            for summary judgment. Bixler v. Cent. Pa.
wrongful denial of ERISA benefits,                Teamsters Health & Welfare Fund, 12
disclosure violations, and breach of              F.3d 1292, 1297 (3d Cir. 1993). Motions
fiduciary duty.        During discovery,          for summary judgment must be granted if
Depenbrock moved to compel the                    there is no genuine issue as to any material
production of fifty-two documents that            fact and the moving party is entitled to
CIGNA claimed were protected by the               judgment as a matter of law. Fed. R. Civ.
attorney-client privilege and/or “work            P. 56(c); Ryan by Capria-Ryan v. Fed.
product” doctrine. The District Court             Express Corp., 78 F.3d 123, 125 (3d Cir.
invited CIGNA to submit an ex parte               1996).
memorandum in support of its claims.                      Depenbrock initially raised five
After conducting an in camera review, the         issues on appeal: 1) whether the “Rehire
                                                  Rule” was effective January 1, 1998; 2)
                                                  whether the plan amendment adopted
  4                                               December 21, 1998, can be given
    One of CIGNA’s actuaries estimated
                                                  retroactive effect; 3) whether CIGNA
that transferring Depenbrock from the
                                                  complied with ERISA’s notice and
Old Plan to the New Plan will result in
                                                  disclosure requirements; 4) whether
his losing $800,000 in benefits, assuming
                                                  Depenbrock’s failure-to-produce claim
he continued to work for CIGNA until
                                                  against CIGNA fails as a matter of law;
age 55.

                                              3
and 5) whether the “fiduciary exception”           amendments must be conducted according
to the attorney-client privilege compels           to formal procedures. 29 U.S.C. § 1102.5
CIGNA to produce fifty-two ostensibly              “[W]hatever level of specificity a company
privileged documents. Disposition of the           ultimately chooses, in an amendment
first two issues renders discussion of the         procedure or elsewhere, it is bound to that
remaining issues unnecessary.           We         level.” Curtiss-Wright, 514 U.S. at 85.
therefore turn to the effective date of the        Thus, an amendment is ineffective if it is
amendment and analyze whether the                  incon sis te nt with the gov ernin g
amendment may be applied retroactively.            instruments. Delgasso v. Sprang & Co.,
   A. Effective Date of the Amendment              769 F.2d 928, 935-36 (3d Cir. 1985); see
          Before turning to the merits, we         Confer, 952 F.2d at 43 (“Only a formal
first set forth some background on ERISA.          wr itte n am e ndme nt, e xec ute d in
“Erisa does not create any substantive             accordance with the Plan’s own procedure
entitlement to employer-provided . . .             for amendment, could change the Plan.”).
welfare benefits. Employers or other plan
sponsors are generally free under ERISA,                  As a threshold matter, Depenbrock
for any reason at any time, to adopt,
modify, or terminate welfare plans.”
Curtiss-Wright Corp. v. Schoonejongen,               5
                                                      The pertinent provisions of 29 U.S.C.
514 U.S. 73, 78 (1995); see Bellas v. CBS,
                                                   § 1102 provide:
221 F.3d 517, 522 (3d Cir. 2000) (“ERISA
                                                         (a) Named fiduciaries
neither mandates the creation of pension
                                                         (1) Every employee benefit
plans nor in general dictates the benefits a
                                                         plan shall be established
plan must afford once created.”).
                                                         and maintained pursuant to
However, “ERISA requires that all
                                                         a written instrument. . . .
employee benefit plans be ‘established and
                                                         ***
main tained pursuant to a written
                                                         (b) Requisite features of
instrument,’ 29 U.S.C. § 1102(a)(1) . . . .”
                                                         plan:      Every employee
Ryan by Capria-Ryan, 78 F.3d at 126.
                                                         benefit plan shall--
Thus, “[t]his section precludes oral or
                                                                     ***
informal amendments to employee benefit
                                                         (3) provide a procedure for
plans.” Confer v. Custom Eng’g, 952 F.2d
                                                         amending such plan, and for
41, 43 (3d Cir. 1991) (citing Hozier v.
                                                         identifying the persons who
Midwest Fasteners, Inc., 908 F.2d 1155,
                                                         have authority to amend the
1163 (3d Cir. 1990)). Although the
                                                         plan, and
Supreme Court has established a de
                                                         (4) specify the basis on
minimus standard for compliance with
                                                         which payments are made to
ERISA, see Curtiss-Wright, 514 U.S. 73,
                                                         and from the plan.
the plan must identify the person who has
the authority to amend the plan, and

                                               4
claims that CIGNA’s CEO lacked                     Rule.” Section 16.1 of the CIGNA plan
authority to amend the plan. Alternatively,        specified three methods for amendment:
Depenbrock contends that even if the CEO           1) a resolution of the Board of Directors;
was authorized to amend the plan, he               2) a resolution of the People’s Resources
failed to comply with CIGNA’s own                  Committee of the Board of Directors
written amendment procedures so that the           (“PRC”); or 3) a written instrument
amendment was not effective until                  approved and executed by one or more
December 21, 1998, the date when                   duly authorized officers of CIGNA. On
CIGNA finally executed revised formal              July 23, 1997, the PRC adopted a
plan documents in accordance with the              resolution authorizing the CEO to:
amendment procedure set forth in the plan.                adopt amendments to the
Because the amendment’s effective date                    CIGNA Pension Plan . . . to
came twenty-two days after Depenbrock                     be effective January 1, 1998
was rehired, Depenbrock contends the                      (or a later date if deemed
adverse amendment does not apply to him.                  appropriate by the CEO), as
                                                          necessary or appropriate to .
         CIGNA counters that its CEO was                  . . [c]hange the Plan’s
duly authorized to amend the plan and he                  current “final average pay”
did so pursuant to the doctrine of                        benefit accrual formula to a
ratification.    According to CIGNA,                      “cash balance” formula for
although the plan amendment was not                       all eligible participants
formally adopted until December 21, 1998,                 under the Plan except those
the CEO’s approval on November 4, 1997,                   who (1) are currently
of a summary of the proposed “cash                        accruing benefits under the
balance” pension formula and “Rehire                      form ula in effect o n
Rule,” coupled with his subsequent                        December 31, 1988, and (2)
conduct, effected a retroactive ratification              whose combined age plus
of the plan amendment to be effective                     years of credited service . . .
January 1, 1998. Accordingly, CIGNA                       is 45 or more as of
claims that the “Rehire Rule” was                         December 31,
effective as of the date specified for the                1997 . . . .
amendment – January 1, 1998 – and
applied to Depenbrock because he                    This resolution gave the CEO plenary
resigned on January 2, 1998, one day after         authority to amend the plan from a “final
the alleged effective date of the rule.            average pay” to a “cash balance” formula.
         We first address the CEO’s                The exception provided for long-term
authority to amend.       As a threshold           employees does not insulate them from the
determination, we agree with the District          CEO’s decision-making authority so much
Court that the CEO was authorized to               as clarify that long-term employees are not
amend the plan and adopt the “Rehire               subject to the plan changes. Accordingly,

                                               5
we conclude that the CEO had authority to         weeks after Depenbrock had been rehired.
adopt the “Rehire Rule” amendment.                Thus, December 21, 1998, is the effective
         However, the CEO did not exercise        date of the amendment. However, this
his authority to amend the plan until             does not resolve the issue, for we must
December 21, 1998, the date the written           consider whether the doctrine of
amendment was executed and formally               r a t i f i c a t i o n , u rg e d b y C I G N A ,
adopted. ERISA specifies that a valid             retroactively rendered the amendment and
amendment can only be made in the                 “Rehire Rule” effective as of January 1,
manner specified in the plan document.            1998.
Cu rtiss-W right, 514 U.S. at 85.                              B. Retroactive Ratification
Regardless of the method specified for                         The doctrine of ratification provides
amendment, however, an indispensable              that an improperly authorized amendment
requirement under ERISA for effective             may be ratified ex post by subsequent acts.
plan amendment is that the amendment be           See Curtiss-Wright, 514 U.S. at 85.
in writing. See Hozier, 908 F.2d at 1163          M oreover, a validly accomplished
(citing Nachwalter v. Christie, 805 F.2d          ratification ordinarily must be given
956. 960 (11th Cir.1986) (“ERISA                  retroactive effect, rendering the ratified
precludes oral modifications of employee          action valid as of the original decision
benefit plans.”)); Pizlo v. Bethlehem Steel       date. Schoonejongen v. Curtiss-Wright,
Corp., 884 F.2d 116, 120 (4th Cir.1989)           Nos. 92-5695 & 92-5710, slip op. at 3 (3d
(stating that “informal” or “unauthorized”        Cir. Aug. 30, 1995). However, ratification
modification of pension plans is                  is prohibited where the amendment
“impermissible” under ERISA); Degan v.            retroactively reduces the intervening rights
Ford Motor Co., 869 F.2d 889, 895 (5th            of third parties, such as plan participants.
Cir.1989) (“ERISA mandates that [a] plan          See Curtiss-Wright v. Schoonejongen, 143
itself and any changes made to it [are] to        F.3d 120, 124-25 (3d Cir. 1998) (on
be in writing.”); Musto v. Am. Gen. Corp.,        remand) (rejecting ex post ratifications that
861 F.2d 897, 910 (6th Cir.1988) (“[A]            defeat intervening rights); Confer, 952
written employee benefit plan may not be          F.2d at 43 (holding that an amendment
modified or superceded b y oral                   limiting eligibility can operate only
undertakings on the part of the                   prospectively); 2A W illiam Fletcher,
employer.”), cert. denied, 490 U.S. 1020          Fletcher Cyclopedia of the Law of Private
(1989); Moore v. Metro. Life Ins. Co., 856        Corporations § 782, at 647-48 (perm. ed.
F.2d 488, 492 (2d Cir.1988) (“[A]n ERISA          rev. vol. 1992) (“Ratification cannot relate
welfare plan is not subject to amendment          back so as to defeat intervening rights of
as a result of informal communications            strangers to the transaction.”).
between the employer and pla n                                 In the instant case, the District
beneficiaries.”). The CEO did not sign a          Court concluded that the December 21,
written instrument amending the plan until        1998, date of formal adoption is not fatal
December 21, 1998, more than three                to the adoption of the amendment to the

                                              6
“Rehire Rule” as of January 1, 1998.               ineffective.
According to the District Court, the CEO                  CIGNA argues nonetheless that the
“manifested his intent” to amend the               amendment did not reduce Depenbrock’s
“Rehire Rule,” effective January 1, 1998,          then-accrued benefits under the plan
by his approval of a summary of the                because Depenbrock worked for only a
proposed amendment on November 4,                  short period in 1998 before the amendment
1997. Furthermore, the CEO’s actions               became effective on December 21, 1998.
subsequent to his approval ostensibly              Because Depenbrock worked only a
“constituted a ratificatio n of the                fraction of the year, CIGNA contends he
amendment both express and implied.”               did not amass the 1,000 work hours
The District Court cites as proof the              needed to accrue a year of service credit
following subsequent conduct: the CEO’s            under the Old Plan. Because Depenbrock
failure to voice opposition to the “Rehire         allegedly accrued no service credit under
Rule” described in the “Signature Benefits         the Old Plan, retroactive application of the
Retirement Kit” distributed to participants        “cash balance” formula to his service
in December, 1997; the CEO’s failure to            following his rehire did not reduce any
object to the “Rehire Rule” described in           accrued benefit. As such, CIGNA claims
the Summary Plan Description that was              there is nothing unlawful in subjecting
generated for the New Plan in October,             Depenbrock to the “Rehire Rule.”
1998; and the CEO’s express execution of                  Even if we were somehow to
the formal amendment to the plan on                conclude that excluding Depenbrock from
December 21, 1998.                                 the Old Plan was not a retroactive
         Unfortunately for CIGNA, the              reduction of benefits, CIGNA’s argument
District Court’s reliance on the doctrine of       fails because it wrongly assumes that
ratification is misplaced because                  CIGNA could transfer Depenbrock out of
ratification would effect a retroactive            the Old Plan and into the New Plan
reduction of Depenbrock’s accrued                  without effectuating another formal plan
benefits under the Old Plan. Given that            amendment. CIGNA contends that even if
the amendment was not formally adopted             the amended plan were not properly
until December 21, 1998, Depenbrock                adopted until December 21, 1998, CIGNA
acquired rights in the interval before             could leave Depenbrock in the Old Plan
affirmance – namely, the right to receive          for twenty-two days, and then transfer him
benefits under the Old Plan – and retained         to the New Plan on December 21, 1998,
his right to accrued benefits, instead of          the effective date of the amendment.
having to settle for the more modest               However, CIGNA overlooks that it would
benefits provided under the New Plan.              have no authority upon which to transfer
Because ratification of the amendment as           Depenbrock without effectuating another
of November 4, 1997, would unlawfully              formal plan amendment, which it did not
deprive Depenbrock of intervening                  do.
substantial bene fits, ratification is                    Moreover, CIGNA’s assertion that

                                               7
t h e ame ndm ent did n ot re duce                  a dollar amount of benefits. According to
Depenbrock’s accrued benefits is premised           this interpretation, retroactive amendments
on an unsubstantiated interpretation of             to a plan are permissible so long as the
ERISA’s “Anti-cutback” rule, 29 U.S.C. §            dollar amount of accrued benefits is not
1054(g).6       The “Anti-cutback” rule             reduced.       CIGNA claims – which
prohibits a plan amendm ent from                    Depenbrock disputes – that transferring
decreasing a participant's “accrued                 Depenbrock to the New Plan does not
benefits.” Id.; see, e.g., Cent. Laborers’          reduce his dollar amount of benefits
Pension Fund v. Heinz, 214 S. Ct. 2230,             because the benefits he earned under the
2237 (2004); Bellas, 221 F.3d at 522 (“[A]          Old Plan were converted into an opening
plan amendment that retroactively reduced           account balance in the New Plan. 7
benefits promised to plaintiffs for almost                  Regardless of the merits of
seven years was precisely the sort of               Depenbrock’s challenge to CIGNA’s
inequity Congress designed ERISA to                 assertion, CIGNA’s argument fails
prevent.”).      ERISA defines “accrued             because it is predicated upon a proposed
benefit” as an individual's right to a              treasury regulation that is not yet the law.
retirement benefit “determined under the            See Prop. Treas. Reg. § 1.411(d)-3(a)(4),
plan . . . expressed in the form of an annual       Example 2, 69 Fed. Reg. 13769 (M ar. 24,
benefit commencing at normal retirement             2004) (proposing to reinterpret the “Anti-
age.” 29 U.S.C. § 1002(23); see Berger,             cutback” rule so as to limit the protection
911 F.2d at 917. CIGNA construes                    of accrued benefits to purely a dollar
“accrued benefit” narrowly to mean purely           amount).         Although the Treasury
                                                    Department retains interpretive jurisdiction
                                                    over the “Anti-cutback” rule, see 43 Fed.
  6                                                 Reg. 47713 (Oct. 17, 1978), “a proposed
    29 U.S.C. § 1054(g) provides in
                                                    regulation does not represent an agency's
relevant part:
                                                    considered interpretation of its statute . . .
(1) The accrued benefit of a participant
                                                    .” Commodity Futures Trading Comm’n
under a plan may not be decreased by an
amendment of the plan . . . .
        (2) For purposes of paragraph (1),
                                                      7
a plan amendment which has the effect                   Depenbrock maintains that CIGNA
of--                                                credits the initial “cash balance”
(A) eliminating or reducing an early                accounts of rehired employees like him
retirement benefit or a retirement-type             with less than the full value of their
subsidy (as defined in regulations), or             previously earned annuities. As a result,
(B) eliminating an optional form of                 he claims employees start with lower
benefit, with respect to benefits                   benefits for purposes of the “cash
attributable to service before the                  balance” formula than they had before
amendment shall be treated as reducing              and it takes years for rehired employees
accrued benefits. . . .                             to catch-up with where they began.

                                                8
v. Schor, 478 U.S. 833, 845 (1986); see,                prohibit plan amendments that “directly or
e.g., Ca. Rural Legal Assistance, Inc. v.               indirectly” affect accrued benefits. “Plan
Legal Servs. Corp., 917 F.2d 1171, 1173                 provisions indirectly affecting accrued
n.5 (9th Cir. 1990) (“We decline to take                benefits include, for example, provisions
cognizance of the proposed regulation                   relating to years of service and breaks in
however, because ‘a proposed regulation                 service for determining benefit accrual . .
does not represent an agency's considered               . .” Id. Because CIGNA’s amendment
interpretation of its statute . . . .’”) (quoting       adopts the “Rehire Rule” that “directly or
Schor, 478 U.S. at 845).                                indirectly” affects the calculation of
        Until the proposed treasury                     benefits, the amendment as applied to
regulation becomes law, the current                     Depenbrock is prohibited.
regulations govern.8             The current                   Even if Depenbrock had been
regulations, 26 C.F.R. § 1.411(d)-3(b), 9               notified of the proposed “Rehire Rule” by
                                                        the “Signature Retirement Benefits Kit” –
  8
                                                        as CIGNA urges – such notice was
   We note that as of June 28, 2004, the                insufficient to have implemented the
proposed treasury regulation redefining                 amendment because ERISA provides that
“Protected Benefits” – Section 411(d)(6)                amendments to a plan may only occur if
(BIN 1545-BC26) – has progressed to                     made in writing. See supra Part II.A. The
the “Final Rule Stage.” See 69 Fed. Reg.                written amendment, as previously stated,
37976. However, it is still not the law.                was not executed until December 21,
  9                                                     1998. Thus, December 21, 1998, is the
    26 C.F.R. § 1.411(d)-3(b) provides in
                                                        effective date of the amendment.
relevant part:
       Under section 411(d)(6) a plan is
                                                               Depenbrock’s participation in the
       not a qualified plan (and a trust
       forming a part of such plan is not a
       qualified trust) if a plan amendment
       decreases the accrued benefit of                        adoption and effective dates shall
       any plan participant, unless the plan                   be treated as one plan amendment.
       a m e nd m en t satisfies th e                          Plan provisions indirectly affecting
       requirements of section 412(c)(8)                       accrued benefits include, for
       (relating to certain retroactive                        example, provisions relating to
       amendments) and the regulations                         years of service and breaks in
       thereunder.       For purposes of                       service for determining benefit
       determining whether or not any                          accrual, and to actuarial factors for
       participant's accrued benefit is                        determining optional or early
       decreased, all the provisions of a                      retirement benefits.
       plan affecting directly or indirectly
       the computation of accrued benefits
       which are amended with the same

                                                    9
Old P l a n should h av e re su m ed
immediately upon his return to work on
November 30, 1998. And his participation
should have continued until either his
employment ended or the terms of
participation in the Old Plan were altered
by a prospective amendment executed in
accordance with CIGNA’s specified
procedures.
        Having determined that the
amendment adversely affects Depenbrock,
we do not reach the question of CIGNA’s
compliance with ERISA’s notice and
disclosure requirements, the validity of
Depenbrock’s failure-to-produce claim
against CIGNA, or the correctness of the
District Court’s finding of attorney-client
privilege.
                    IV.
        Accordingly, for the reasons set
forth above, the summary judgment in
favor of CIGNA Corporation will be
reversed and the case remanded to the
District Court with direction to enter
summary judgment in favor of John
Depenbrock. Costs taxed against CIGNA.

                                              10