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Radell v. Michelin Retirement Plan

United States District Court, Sixth Circuit

September 25, 2013

MARK S. RADELL, individually and on behalf of all other persons similarly situated, Plaintiff,
v.
MICHELIN RETIREMENT PLAN, Defendant.

MEMORANDUM OPINION

THOMAS B. RUSSELL, Senior District Judge.

This administrative review is before the Court upon Plaintiff's Complaint (Docket No. 1). Defendant submitted an Answer (Docket No. 7). Plaintiff also submitted a Motion for Summary Judgment (Docket No. 22), to which Defendant responded (Docket No. 27). Plaintiff replied (Docket No. 28), and this matter is now ripe for adjudication. For the reasons that follow, Defendant's decision relative to Plaintiff's claim will be affirmed, and Plaintiff's claim will be dismissed.

BACKGROUND

This case concerns the calculation of disability retirement pension benefits. Plaintiff Mark S. Radell terminated from Michelin North America while participating in the company's Long Term Disability (LTD) program. He later filed this class action complaint against the Michelin Retirement Plan ("the Plan"), which is governed by the Employee Retirement Income Security Act of 1974 (29 U.S.C. ยงยง 1001 et seq. ) ("ERISA").

The Plan reduced Plaintiff's Disability retirement income benefits based on his election to commence payment of the pension prior to his Normal Retirement Date (i.e., age 65). Plaintiff argues that the Plan's reduction of his pension benefits (and those of the putative class members) directly violated the Plan Document's terms (Docket No. 1 at 2).

I. The Plan Document's terms required the Plan to reduce Plaintiff's benefits based on his early commencement of payment.

The Plan allows participants to retire on one of three dates: the Normal Retirement Date (defined as age sixty-five), the Early Retirement Date, or The Postponed Retirement Date (Docket No. 22-3 at 23). The Plan further provides for a Disability Retirement Date for qualifying participants (Docket No. 22-3 at 23).

The Plan defines an Annuity Commencement Date as "the first day of the first month for which an amount of Pension is payable to [a] Participant or Beneficiary as an annuity...." (Docket No. 22-3 at 11). Plaintiff was age fifty-seven years and nine months upon his Annuity Commencement Date of March 1, 2012 (Docket No. 16-1 at 15; Docket No. 16-2 at 2)

Section 4.5 discusses the Plan's Disability Retirement benefit, setting forth three conditions that a participant must satisfy while an Employee to be entitled to this benefit (Docket No. 22-3 at 26-27).[1] If a Participant fulfills these conditions, "he shall be entitled to receive no less than the Pension accrued by him as of the date he was first Disabled. This Pension shall be calculated according to Section 4.1 of the Plan...." (Docket No. 22-3 at 26). Section 4.1(A) requires the amount of the benefit to be calculated based on the Participant commencing the benefit at Normal Retirement Date.

Finally, Section 4.5 explains that the pension benefit that a participant who collects Disability Retirement will receive is calculated based on Section 4.1 (Docket No. 22-3 at 26).[2] According to this Section, the benefit is calculated based on its commencement on or after the Normal Retirement Date. However, Section 4.3(B) allows a participant to commence his benefit on or after an Early Retirement Date prior to his turning sixty-five if he as at least fifty-five and has completed at least ten years of vested service.[3]

Plaintiff was eligible to elect to commence payment of his Disability Retirement pension benefit prior to his Normal Retirement Date on his Early Retirement Date of March 1, 2012 (Docket No. 16 at 15, 46, 48, 62-63). According to Section 4.3(B), a participant who retires on his Early Retirement Date may elect to receive his pension benefit "commencing on his Early Retirement Date or on the first day of any month thereafter, multiplied by the factor contained in Table A-Actuarial Equivalent Factors for the Participant's age on the date payment is to commence" (Docket No. 22-3 at 25). Plaintiff elected this option. Accordingly, Section 4.3(B) mandated that the Plan reduce Plaintiff's pension benefit by performing the actuarial calculation it described.

II. The Michelin Retirement Plan Summary Plan Description further explains the reduction in the Disability retirement benefit.

The Michelin Retirement Plan Summary Plan Description (SPD) explains that a participant may elect to take the early retirement benefit after reaching age fifty-five and completing at least ten years of vesting service. It continues, "[A]n early retirement factor will be applied to the calculation to reflect the fact that you are taking your benefit prior to the normal retirement age of 65" (Docket No. 22-4 at 7). Further, "[i]f you retire early and elect to begin receiving your retirement benefit before you reach age 65, your benefit will be reduced. This is because your benefit payments are expected to be made for a longer period of time" (Docket No. 22-4 at 11).

III. When Plaintiff expressed concern that his benefits were miscalculated, the Plan explained its application of the Plan Document's terms.

On January 30, 2012, the Michelin Personnel Service Center ("PSC") informed Plaintiff that he accrued a retirement benefit from the Plan and that he may be eligible for retirement. The letter included a statement of Plaintiff's current accrued retirement benefits and invited him to contact the PSC with any concerns (Docket No. 16-1 at 39).

In addition, a second letter of the same date included, among other documents, a benefit election form and two documents titled "Participant Summary Page" ("PSP") The first PSP reflected the data that the Plan used to calculate Plaintiff's benefits and asked him to verify its accuracy (Docket No. 15-2 at 4). The second PSP, a "Calculation Summary Page, " conveyed the formula for calculating Plaintiff's total benefit payable at his Normal Retirement Date and the resultant calculations (Docket No. 16-2 at 5). The Calculation Summary Page reflected an "Early Retirement Adjustment" of 0.660 to Plaintiff's monthly pension benefit. Plaintiff's wife signed both documents as his power of attorney; on the Calculation Summary Page, she wrote, "Disagree with early adjustment. In dispute w/Michelin at current date" (Docket No. 16-2 at 5).

Plaintiff expressed his concerns via e-mail to Michelin personnel on February 7, 2012 (Docket No. 16-1 at 49-50). Plaintiff wrote that "[t]he base calculations appear correct but they then deducted like I was taking early retirement so they reduced the payment by 40%. By reading the MRAP policy it clearly stated that if you retire while on disability the calculations should ...


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