Noorali Savani v. Roger Allen
Filing
UNPUBLISHED AUTHORED OPINION filed. Originating case number: 1:06-cv-02805-JMC Copies to all parties and the district court/agency. [999475989].. [13-2512]
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UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 13-2512
NOORALI SAM SAVANI, individually and on behalf of others
similarly situated; ROBERT P. TAYLOR, JR., individually and
on behalf of others similarly situated,
Plaintiffs - Appellees,
v.
URS PROFESSIONAL SOLUTIONS, LLC, f/k/a Westinghouse Safety
Management
Solutions,
LLC,
f/k/a
Washington
Safety
Management
Solutions,
LLC;
URS
PROFESSIONAL
SOLUTIONS
PENSION PLAN, f/k/a Washington Safety Management Solutions,
LLC Pension Plan, f/k/a WSMS Pension Plan; URS ENERGY &
CONSTRUCTION, INC., f/k/a Washington Group International,
Inc.; ROGER ALLEN, as Trustee and Member of the Benefits now
Administrative Committee of URS Professional Solutions
Pension Plan; JULIE TSCHIDA BROWN, as Trustee and Member of
the
Benefits
now
Administrative
Committee
of
URS
Professional Solutions Pension Plan; DAVE HOLLAN, as Trustee
and Member of the Benefits now Administrative Committee of
URS Professional Solutions Pension Plan; DELOYD CAZIER, as
Trustee and Member of the Benefits now Administrative
Committee of URS Professional Solutions Pension Plan,
Defendants – Appellants,
and
WASHINGTON SAVANNAH RIVER COMPANY, LLC, f/k/a Westinghouse
Savannah River Company, LLC; WESTINGHOUSE SAFETY MANAGEMENT
SOLUTIONS, LLC PENSION PLAN; PAUL HARPER, as Trustee and
Member of the Benefits now Administrative Committee of URS
Professional Solutions Pension Plan; LEO SAIN, as Trustee of
Westinghouse Safety Management Solutions, LLC Pension Plan;
PRES RAHE, as Trustee of Westinghouse Safety Management
Solutions, LLC Pension Plan; WASHINGTON SAVANNAH RIVER
COMPANY'S PENSION PLAN; RALPH DISIBIO, as director of
Washington
Safety
Management
Solution,
LLC;
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PAUL GREFENSTETTE,
as
Director
of
Washington
Safety
Management Solutions, LLC; ROBERT PEDDE, as Director of
Washington
Safety
Management
Solutions,
LLC;
AMBROSE SCHWALLIE,
as
Director
of
Washington
Safety
Management
Solutions,
LLC;
WSMS
PENSION
PLAN,
f/k/a
Westinghouse Savannah River Company-Bechtel Savannah River
Inc Pension Plan, f/k/a Westinghouse Safety Management
Solutions, LLC Pension Plan, f/k/a Washington Safety
Management Solutions, LLC Pension Plan; WASHINGTON SAFETY
MANAGEMENT SOLUTIONS, LLC; WASHINGTON SAFETY MANAGEMENT
SOLUTIONS, LLC PENSION PLAN; WASHINGTON GROUP INTERNATIONAL,
INC.,
Defendants.
Appeal from the United States District Court for the District of
South Carolina, at Aiken.
J. Michelle Childs, District Judge.
(1:06-cv-02805-JMC)
Argued:
September 16, 2014
Decided:
November 17, 2014
Before WILKINSON, GREGORY, and KEENAN, Circuit Judges.
Affirmed by unpublished opinion.
Judge Gregory wrote
opinion, in which Judge Wilkinson and Judge Keenan joined.
the
ARGUED:
H. Douglas Hinson, ALSTON & BIRD, LLP, Washington,
D.C., for Appellants.
Stanley G. Jackson, JACKSON LAW
OFFICES, Aiken, South Carolina, for Appellees.
ON BRIEF:
Emily
S. Costin, ALSTON & BIRD, LLP, Washington, D.C.;
Gray T. Culbreath, GALLIVAN, WHITE & BOYD, P.A., Columbia, South
Carolina, for Appellants.
Unpublished opinions are not binding precedent in this circuit.
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GREGORY, Circuit Judge:
Noorali
Employee
“Sam”
Savani
Retirement
filed
Income
this
class
action
under
Act
(“ERISA”),
Security
the
§ 502(a)(1)(B), 29 U.S.C. § 1132 (a)(1)(B)(2006), claiming that
Washington
Safety
Management
Solutions,
(“WSMS”) 1
LLC’s
termination of an early retirement pension supplement violated
ERISA’s anti-cutback provision.
As we held in the first appeal
of this case, the “clear terms” of the WSMS Pension Plan (the
“Plan”) “include the [early retirement pension supplement] in
the definition of ‘accrued benefit.’”
Savani v. Wash. Safety
Mgmt. Solutions, LLC (Savani I), 474 F. App’x 310, 316 (4th Cir.
Mar.
20,
2012)
(per
curiam)
(unpublished).
In
this
second
appeal, WSMS argues that it may lawfully eliminate that early
retirement
pension
Robert Taylor,
and
(defined below).
benefit
a
as
similarly
to
situated
another
subset
of
employee,
the
class
We again hold that the unambiguous terms of
the Plan clearly include the pension benefit at issue within the
Plan’s definition of “accrued benefit,” and that WSMS may not
lawfully eliminate the benefit.
We therefore affirm the grant
of summary judgment to the plaintiffs-appellees.
1
WSMS is now called URS Professional Solutions, LLC, and
both WSMS and the appellees’ previous employer, Westinghouse
Savannah River Company (“WSRC”), are wholly owned subsidiaries
of a company called URS Energy & Construction.
For ease of
reference and consistency with this Court’s prior opinion, this
memorandum refers only to WSMS and WSRC.
3
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I.
While Savani was the focus of the first appeal, Taylor and
the
subclass
now
take
center
stage.
Much
of
the
relevant
background is set forth in great detail in Savani I, 474 F.
App’x at 312-14, and is repeated below to the extent necessary.
Taylor, like Savani, was an employee of the Westinghouse
Savannah River Company (“WSRC”) in 1997 when WSMS was formed.
“At its inception, WSMS recruited a number of WSRC employees,
including Savani [and Taylor], to transfer to the newly formed
company.”
Id. at 312.
Taylor and the other WSRC employees
“were informed of the employee benefit plans available to newly
transferred employees.”
Id.
Taylor was then and remains a
participant in the Plan.
Prior to a 2004 amendment, the Plan provided in relevant
part:
“‘Accrued
determination,
the
Benefit’
normal
means,
retirement
as
of
Pension
any
date
computed
of
under
Section 4.01(b) . . . less the WSRC Plan offset as described in
Section
4.13,
plus
any
Section 4.12 . . . .”
applicable
supplements
described
in
Additionally, the Plan provided that an
“early retirement Pension shall be a deferred Pension beginning
on the first day following the Member’s Normal Retirement Date
and . . . shall be equal to his Accrued Benefit.
Member
may
elect
to
receive
an
4
early
However, the
retirement
Pension
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beginning before his Normal Retirement Date.
. . .”
Finally,
the Plan described the following supplemental benefit:
4.12 Supplemental Benefits
(a) If a Member who:
(i) otherwise satisfies the requirements for a Pension
under this Plan; and
(ii) has at least one year of service with WSMS; and
(iii) transferred to the Plan from an Affiliated
Employer on or before January 1, 1998 or transfers to
the Plan from WSRC; and
(iv) retires before his Normal Retirement
active service on or before October 1, 1998,
Age
from
he shall be entitled to a monthly supplement (which
shall commence with the first Pension payment under
the Plan on account of such retirement and the last
payment shall be in the month preceding the Member’s
attainment of Normal Retirement Age) equal to the
following: [omitted] 2
“On
December
28,
2004,
the
Plan’s
benefits
committee
amended the Plan to eliminate § 4.12(a), which granted a $700
monthly
benefit
to
Plan
members
electing
retirement on or after January 1, 2005.”
at
313.
Later,
on
January
3,
2006,
to
take
early
Savani I, 474 F. App’x
the
benefits
committee
further amended the Plan, effective December 31, 2005 (“the 2005
Amendment”).
the
following
Among other things, the 2005 Amendment included
provision:
“Notwithstanding
2
anything
to
the
As discussed in our first opinion, § 4.12(b) of the Plan
sets forth an additional $200 benefit payable upon reaching
Normal Retirement Age.
The $200 benefit is not at issue for
purposes of the current appeal.
5
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contrary
in
this
‘frozen’
as
of
thereafter.”
Plan,
a
December
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Member’s
31,
Accrued
2005
and
Further, it provided:
Benefit
shall
not
shall
be
increase
“Notwithstanding anything
to the contrary in this Plan, effective December 31, 2005, no
additional Credited Service will be awarded or earned under the
Plan for any purpose.
In other words, all Credited Service will
be ‘frozen’ as of December 31, 2005.”
The 2005 Amendment also
“added the following sentence at the end” of § 1.13 of the Plan:
“Although
the
Employee
shall
accordance
Plan
with
is
frozen
continue
the
as
to
terms
of
earn
of
December
Eligibility
the
Plan
for
31,
2005,
an
Service
in
purposes
of
determining eligibility for certain benefits and eligibility for
a vested Pension.”
During the first appeal of this case, Savani successfully
challenged the 2004 elimination of § 4.12(a) as a violation of
ERISA’s anti-cutback provision.
See id. at 316 (“[W]e hold that
the Plan’s clear terms include the § 4.12(a) supplement in the
definition of accrued benefits.”).
The 2005 Amendment was not
directly at issue at that time.
Upon remand, the district court certified Savani’s case as
a class action.
Savani is the lead plaintiff for the class,
which is defined to be:
Employees of Washington Safety Management Solutions,
LLC,
formerly
Westinghouse
Safety
Management
Solutions, LLC [collectively “WSMS”] who (1) are
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members of the WSMS Plan, (2) have at least one year
of service with WSMS, and (3) transferred to the Plan
from an Affiliated Employer as defined in § 1.02 of
the Plan on or before January 1, 1998, or transferred
to the Plan from Washington Savannah River Company,
LLC, formerly, Westinghouse Savannah River Company,
LLC [collectively, “WSRC”].
During
the
course
of
the
district
court
proceedings,
WSMS
“opposed paying certain members of the above class who after
December 31, 2005 have or may have become eligible for § 4.12(a)
WSMS [Plan] benefits as related to freeze of benefits as of
December 31, 2005.”
The appellees therefore moved to add Taylor
as a party and subclass representative, and the district court
granted the motion.
Thus, Taylor is the lead plaintiff of the
subclass, which is defined to be:
All members of the Class defined above who, as of
December 21, 2005, either (1) did not have 15 total
years of service with WSMS or an Affiliated Employer
as defined in § 1.02 of the Plan, or (2) was not 50
years of age, or (3) did not meet the 25 years of
service and age 45 but less than 50 years of age
requirements for an Optional Retirement Pension as
defined in § 4.04 of the WSMS Plan.
On
summary
July
31,
judgment
2012,
on
the
the
parties
issue
of
filed
whether
cross
the
motions
2005
for
Amendment
resulted in the lawful elimination of the § 4.12(a) benefit for
Taylor and the members of the subclass.
parties’
motions,
the
district
court
In considering the
observed
that
the
2005
Amendment permitted Plan members to continue to earn Eligibility
Service years in order to determine the members’ “eligibility
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for certain benefits and eligibility for a vested Pension.”
In
light of the unambiguous language of the 2005 Amendment, as well
as
this
Circuit’s
§ 4.12(a)
prior
supplement
holding
violated
that
the
ERISA’s
elimination
anti-cutback
of
the
provision,
the district court granted summary judgment in favor of Taylor
and the subclass members and held that they are entitled to
receive the supplement.
WSMS subsequently filed a motion to
remand the matter to the Plan’s benefits committee, or in the
alternative, for the district court to reconsider its summary
judgment ruling.
WSMS argued that the district court had “erred
by not remanding the case back to the Committee for an initial
interpretation
argued
in
of
the
the
language
alternative
of
the
that
2005
the
Amendment.”
district
misconstrued the nature of the parties’ dispute.
court
denied
unambiguous
the
Plan
motion,
language,
reasoning
and
that
that
it
remand
court
It
had
The district
had
“would
interpreted
be
futile
because a different interpretation of this clear language would
be an abuse of the committee’s discretion.”
On December 13,
2013, WSMS timely filed this appeal.
II.
On appeal, the WSMS argues that Taylor and the members of
the subclass are not eligible for the § 4.12(a) benefit because
they did not satisfy the requisite eligibility requirements for
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the benefit prior to the effective date of the 2005 Amendment.
Alternatively, the WSMS argues that the district court erred by
failing to remand this matter to the Plan’s benefits committee.
A.
We
novo.
review
a
court’s
order
granting
summary
judgment
de
United McGill Corp. v. Stinnett, 154 F.3d 168, 170 (4th
Cir. 1998).
And “[i]n an appeal under ERISA, we . . . employ[]
the same standards governing the district court’s review of the
plan administrator’s decision.”
Co.,
609
F.3d
622,
629
(4th
Williams v. Metro. Life. Ins.
Cir.
2010).
Where
“the
plan
expressly grants the plan administrator discretionary authority
to
construe
the
provisions,
the
administrator’s
reviewed for abuse of discretion.”
decision
is
United McGill Corp., 154
F.3d at 170 (citing Firestone Tire & Rubber Co. v. Bruch, 489
U.S. 101, 115 (1989)).
“Under this deferential standard, ‘the
administrator or fiduciary’s decision will not be disturbed if
it
is
reasonable,
different
even
conclusion
if
this
court
independently.’”
would
Id.
have
come
(quoting
Ellis
Metro. Life Ins. Co., 126 F.3d 228, 232 (4th Cir. 1997)).
the
Plan
grants
the
benefits
committee
discretion to interpret the Plan.”
“total
and
to
a
v.
Here,
complete
But “even as an ERISA plan
confers discretion in its administrator to interpret the plan,
the administrator is not free to alter the terms of the plan or
to construe unambiguous terms other than as written.”
9
Colucci
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v. Agfa Corp. Severance Pay Plan, 431 F.3d 170, 176 (4th Cir.
2005), abrogated on other grounds by Champion v. Black & Decker
(U.S.), Inc., 550 F.3d 353 (4th Cir. 2008).
The discretionary
authority to interpret a plan “is not implicated . . . [where]
the terms of the plan itself are clear.”
Kress v. Food Emp’rs
Labor Relations Ass’n, 391 F.3d 563, 567 (4th Cir. 2010).
B.
WSMS
argues
subclass
did
that
not
because
satisfy
Taylor
the
age
and
and
the
members
service
of
the
eligibility
requirements for the § 4.12(a) benefit prior to the effective
date
of
Thus,
the
the
2005
Amendment,
argument
goes,
they
the
never
elimination
accrued
of
the
the
benefit.
benefit
for
Taylor and the subclass does not constitute an unlawful cutback
of accrued benefits.
This argument does not square with our
previous holding in this case that the unambiguous language of
the Plan’s definition of accrued benefit includes the § 4.12(a)
benefit.
Savani I, 474 F. App’x at 315-16.
Under the law of the case doctrine, “when a court decides
upon a rule of law, that decision should continue to govern the
same issues in subsequent stages in the same case.”
TFWS, Inc.
v. Franchot, 572 F.3d 186, 191 (4th Cir. 2009) (quoting United
States
v.
Aramony,
166
F.3d
Accordingly,
10
655,
661
(4th
Cir.
1991)).
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once the decision of an appellate court establishes
the law of the case, it “must be followed in all
subsequent proceedings in the same case in the trial
court or on a later appeal [] unless:
(1) a
subsequent
trial
produces
substantially
different
evidence, (2) controlling authority has since made a
contrary decision of law applicable to the issue, or
(3) the prior decision was clearly erroneous and would
work manifest injustice.”
Id. (quoting Aramony, 166 F.3d at 661) (alteration in original).
Here,
the
parties
have
not
presented
substantially
different
evidence, we are aware of no new controlling authority, and WSMS
has not argued that our prior decision was clearly erroneous.
Therefore, our analysis must be guided by our prior holding that
the $700 monthly supplement set forth in § 4.12(a) of the Plan
is an accrued benefit.
There is no dispute that an employer sponsored retirement
plan
cannot
ERISA’s
eliminate
anti-cutback
Importantly,
“ERISA
an
“accrued
benefit”
provision.
defines
29
‘accrued
without
U.S.C.
benefit’
violating
§ 1054(g)(1).
as
‘. . .
the
employee’s accrued benefit determined under the plan and . . .
expressed in the form of an annual benefit commencing at normal
retirement age . . . .’”
Savani I, 474 F. App’x at 315 (quoting
26 U.S.C. § 411(a)(7)(A)(i) (2010)).
This statutory definition
of an accrued benefit is “a signpost, directing us to look at
the terms of the plan at issue.”
Bd. of Trs. of the Sheet Metal
Workers’ Nat’l Pension Fund v. Comm’r, 318 F.3d 599, 602-03 (4th
Cir.
2003)
(emphasis
added).
As
11
we
previously
held,
the
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§ 4.12(a) benefit is an accrued benefit.
at 316.
Savani I, 474 F. App’x
Because Taylor and the members of the subclass can or
already do satisfy the requisite eligibility requirements for
the
§ 4.12(a)
benefit,
WSMS
may
not
lawfully
eliminate
that
benefit as to Taylor and the subclass.
WSMS argues that Taylor and the members of the subclass had
a
mere,
unprotected
benefit
because
requirements
expectation
they
prior
did
to
not
of
receiving
satisfy
December
31,
the
2005.
the
age
In
§ 4.12(a)
and
service
advancing
this
argument, WSMS relies heavily on the Eleventh Circuit’s ruling
in Cinotto v. Delta Air Lines, Inc., 674 F.3d 1285 (11th Cir.
2012).
There, part of the Delta retirement plan definition of
“Accrued Benefit” stated:
No Participant shall have an Accrued Benefit based on
future or projected service or Earnings regardless of
the use of future dates by the Plan.
Such future
dates and the result of projected service on future
Earnings on a Participant’s potential retirement
benefit are not part of the Participant’s Accrued
Benefit.
Cinotto, 674 F.3d at 1287-88.
this
case,
provided:
Plan
are
froze
pension
The Delta plan, like the Plan in
benefits
with
an
amendment
that
“Effective December 31, 2005, all benefits under the
frozen
for
all
Participants
and
there
shall
be
no
further accruals of benefits under this plan after that date.”
Id. at 1289.
of
the
The amendment “also added this language to the end
[Delta]
Plan’s
definition
12
of
‘Accrued
Benefit’:
‘A
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Participant shall not accrue any additional benefits under the
Plan after December 31, 2005.’”
Id.
Under the amendment, “no
additional months of service or earnings would be taken into
account
in
calculating
either
[an
employee’s]
termination benefit under the [Delta] Plan.”
retirement
Id.
or
As a result
of the Delta plan language, the Eleventh Circuit held that the
plaintiff, who had not reached the age required to receive the
benefit
at
issue
before
December
expectation of a future accrual.”
31,
2005,
“had
at
most
an
Id. at 1297.
Unlike the amendment to the Delta plan, the 2005 Amendment
to the Plan at issue here explicitly incorporated future service
into the calculation of an accrued benefit.
Amendment
stated
Eligibility
certain
that
Service
benefits,”
Plan
years
members
“to
including
would
Indeed, the 2005
continue
determin[e]
the
to
eligibility
§ 4.12(a)
benefit.
earn
for
The
unambiguous terms of the Plan provide that Eligibility Service
years
determine
whether
a
Member
“otherwise
satisfies
the
requirements for a Pension under this Plan” such that he becomes
eligible for the § 4.12(a) $700 supplement. 3
Accordingly, the
appellants’ reliance on Cinotto -- which involved a pension plan
3
Pensions include, for example, the normal retirement
pension set forth in Plan § 4.01, the early retirement pension
set forth in Plan § 4.03, and the optional retirement pension
set forth in Plan § 4.04.
Each of these pensions references
“Eligibility Service.”
13
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with a materially different definition of an “accrued benefit” - is misplaced.
See Sheet Metal Workers’ Nat’l Pension Fund v.
Comm’r, 318 F.3d at 602-03 (stating that courts “look at the
terms of the plan at issue”).
WSMS
also
argues
remanded
this
matter
reference
to
“certain
that
to
the
the
district
benefits
benefits”
in
“Eligibility Service” is ambiguous.
that
it
is
unclear
whether
court
should
committee
the
Plan’s
have
because
the
definition
of
Specifically, WSMS contends
the
term
“certain
benefits”
encompasses the § 4.12(a) benefit.
This argument is unavailing.
Before
definition
the
2005
Amendment,
the
of
“Eligibility
Service” included a single reference to “certain benefits,” and
the
2005
Amendment
benefits.”
added
a
second
reference
to
“certain
It is undisputed that the single, pre-2005 Amendment
reference to “certain benefits” included the § 4.12(a) benefit.
To credit WSMS’s ambiguity argument would require a finding that
the second use of the phrase means something different than the
first.
term
There is no valid reason for the two uses of the same
within
the
same
Rather,
the
language
members
may
continue
definition
of
to
the
earn
2005
to
have
different
Amendment
Eligibility
is
clear:
Service
certain benefits, including the § 4.12(a) benefit.
meanings.
years
Plan
for
The benefits
committee’s discretion is not implicated given the unambiguous
language
of
the
amendment.
Kress,
14
391
F.2d
at
567.
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Accordingly, it was not error for the district court to decline
to remand the matter.
Somewhat relatedly, WSMS argues that “Fourth Circuit law is
clear that an ERISA plan participant is ‘required’ to exhaust
his/her
administrative
contends
that
challenged
the
the
remedies
original
meaning
of
before
lead
bringing
plaintiff,
‘certain
benefits’
suit.”
Savani,
of
It
“never
‘Eligibility
Service’ in the Freeze Amendment,” and that “Taylor has never
made
any
claim
to
the”
benefits
committee.
Therefore,
WSMS
continues, because the district court’s summary judgment ruling
involved
the
interpretation
of
the
Plan’s
terms,
the
court
should have first remanded the matter to the benefits committee
for it to interpret the Plan in the first instance.
We need not
decide whether any procedural error has occurred.
In reaching
its decision, the district court did not engage in any novel
interpretation of the Plan’s language.
Rather, the law of this
case is that the Plan’s definition of accrued benefit includes
the § 4.12(a) benefit, and as discussed above, the term “certain
benefits”
unambiguously
encompasses
the
§ 4.12(a)
benefit.
Thus, the benefits committee’s authority to interpret the Plan
is not implicated.
See Kress, 391 F.2d at 567.
Finally, although the parties devote a substantial amount
of their briefing to whether the § 4.12(a) benefit is an “early
retirement benefit” as that term is defined in the applicable
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regulations, we need not resolve the issue.
Regardless of how
the benefit is characterized from a statutory perspective, the
fact remains -- however much WSMS might wish to deny it –- that
the
specific
language
of
the
WSMS
Plan
incorporates
the
§ 4.12(a) benefit into the definition of “accrued benefit.”
And
“[w]hile we have held that unfunded, contingent early retirement
benefits or severance payments are not secured by ERISA itself,
the
drafters
benefits
as
of
a
accrued
protections.”
retirement
or
plan
vested,
may
and
choose
thereby
to
define
trigger
any
ERISA’s
Savani I., 474 F. App’x at 314 n.3 (citing Pierce
v. Sec. Trust Life Ins. Co., 979, F.2d 23 (4th Cir. 1992)); see
id. at 316 (“Stand-alone, ancillary welfare benefits generally
are not independently protected by ERISA.
Here, however, the
Plan plainly incorporated . . . [§ 4.12(a)] into its definition
of ‘accrued benefit.’” (citation omitted)).
the
choice
to
include
the
§ 4.12(a)
benefit
Because WSMS made
as
part
of
the
Plan’s accrued benefit, it is protected under the anti-cutback
provision of ERISA.
The WSMS must accept the consequences of
that choice.
III.
We reaffirm our holding that the Plan’s clear terms include
the § 4.12(a) supplement in the definition of “accrued benefit.”
Taylor and the subclass members are thus entitled to receive
16
Appeal: 13-2512
that
Doc: 29
benefit
Filed: 11/17/2014
so
Pg: 17 of 17
long
satisfy
as
they
the
age
and
requirements if and when they elect early retirement.
service
For the
foregoing reasons, the judgment of the district court is
AFFIRMED.
17
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