James Price v. Board of Trustees of the India, et al
Per Curiam OPINION: The petition for panel rehearing is denied, decision not for publication. The Clerk shall now refer the matter to all of the active members of the court for further proceedings on the suggestion for en banc rehearing. Jeffrey S. Sutton and David W. McKeague, Circuit Judges; and Robert J. Jonker, (CONCURRING IN THE RESULT DENYING REHEARING), District Judge.
NOT RECOMMENDED FOR PUBLICATION
File Name: 13a0403n.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
JAMES R. PRICE,
BOARD OF TRUSTEES OF THE INDIANA
LABORER’S PENSION FUND; INDIANA
LABORER’S PENSION FUND,
Apr 22, 2013
DEBORAH S. HUNT, Clerk
On Appeal from the United
States District Court for the
Southern District of Ohio
SUTTON and McKEAGUE, Circuit Judges; and JONKER, District Judge.
PER CURIAM. Quite a bit of ink has been spilled in this case, making us reluctant
to add another opinion to the two this court has already issued. But in his petition for
rehearing, James Price makes three claims worthy of response: (1) that our opinion
creates a split in the circuit courts of appeals; (2) that the decision is inconsistent with our
own circuit precedent, including one newly cited case; and (3) that disability benefits vest
as a matter of law whenever a beneficiary becomes disabled, prohibiting the trustees of
the plan from ever making changes to those benefits, no matter the terms of the benefits
1. In claiming that this case would come out differently if Price lived elsewhere in
the country, Price mentions several court of appeals decisions. But on examination they
Hon. Robert J. Jonker, United States District Judge for the Western District of Michigan,
sitting by designation.
do not live up to his claim. Some of the courts have held that plan amendments may not
force beneficiaries to return money already paid out. See Wal-Mart Stores, Inc. Assocs.
Health & Welfare Plan v. Wells, 213 F.3d 398 (7th Cir. 2000); Member Servs. Life Ins. Co.
v. Am. Nat’l Bank & Trust Co. of Sapulpa, 130 F.3d 950 (10th Cir. 1997). Others have held
that a board may not amend a plan to avoid medical coverage for treatment a beneficiary
has already arranged or accidents a beneficiary has already suffered. See Wheeler v.
Dynamic Eng’g, Inc., 62 F.3d 634 (4th Cir. 1995); Confer v. Custom Eng’g Co., 952 F.2d
41 (3d Cir. 1991). Others have held that a board may not amend disability benefits if the
plan language does not give it that authority. See Feifer v. Prudential Ins. Co. of Am., 306
F.3d 1202 (2d Cir. 2002); Howe v. Varity Corp., 896 F.2d 1107 (8th Cir. 1990). And others
have held that life insurance benefits vest when an insured dies. See, e.g., Blackshear v.
Reliance Standard Life Ins. Co., 509 F.3d 634 (4th Cir. 2007), abrogated on other grounds
by Metro. Life Ins. Co. v. Glenn, 554 U.S. 105 (2008). These cases have two things in
common: We do not disagree with any of them, and they do not help to resolve this
2. Much the same can be said about his efforts to re-plow the ground covered by
one case from our circuit and to add a new one. In Wulf v. Quantum Chem. Corp., 26 F.3d
1368 (6th Cir. 1994), Quantum transferred some employees to a new company in April and
allowed them to cash out their retirement plans in October. A dispute arose about whether
Quantum should calculate the value of the plans as of April (when they were worth more),
or October (when they were worth less). April, we answered: The plan language said
retirement benefits vested when an employee was “terminated,” and transfers count as a
“termination.” That answer, however, says nothing about whether Price’s disability benefits
were vested under the terms of his plan. Cattin v. Gen. Motors Corp., 955 F.2d 416 (6th
Cir. 1992), is of a piece. After offering additional retirement benefits for some time to
employees who had reached thirty years of service, General Motors cancelled the program.
We saw no problem with the change, a holding that cannot possibly help other employees
seeking to prevent the cessation of benefits.
3. As for Price’s proposed rule that disability benefits, once initially provided, may
never be altered, we cannot ignore the source of those benefits: the terms of the plan.
One path to Price’s approach would be to extend the “vesting” limitation on benefits
changes to disability benefits. But as our first opinion showed and as Price no longer
seems to disagree, that possibility cannot be squared with the way “vesting” is used
throughout the plan—namely, to apply only to traditional retirement benefits. See Price v.
Bd. of Trs. of the Ind. Laborer’s Pension Fund, 632 F.3d 288, 297–98 (6th Cir. 2011). That
leaves the meaning of all of the language that permits the board to “amend” the plan in
ways that do not reduce “rights” that “have already become vested.” No one, including
Price, seems to disagree that the plan gives the board of trustees broad discretion to
interpret this language and that we as a result must respect that interpretation—unless it
enters the forbidden land of arbitrariness and capriciousness. Id. at 296. Left to our own
devices, we might have construed this language to prohibit the ending of disability benefits
after a disability has occurred. But that is not the interpretation the trustees adopted. The
plan has finite resources and competing demands on those funds, all beyond our ken,
which is why the plan empowers trustees, not federal judges, to change its
terms—including by extending disability benefits for two years but no longer and including
by changing the plan in ways we might not have changed it ourselves.
At oral argument, Price’s lawyer conceded that, if the plan had clarified that the
authority to amend extended to disability benefits after the disability had occurred, nothing
would have stood in the way of the board’s action. Price v. Bd. of Trs. of the Ind. Laborer’s
Pension Fund, 707 F.3d 647, 651 n.2 (6th Cir. 2013). If that is so, we are hard pressed to
understand how the plan’s silence on this score somehow divests the board of authority
to construe the plan in this manner. Silence equals ambiguity; ambiguity equals discretion;
and discretion is difficult to second guess when it involves allocating finite resources to a
range of people over a long period of time. Having no responsibility for the finite resources
of the plan ourselves and having no knowledge what other demands have been placed on
those resources, we must exercise caution before we call such a choice arbitrary and
capricious. We don’t think it was.
Nor, in contrast to life insurance, are disability benefits fixed. Not all disabilities are
permanent; many, mercifully, are not. And not all disabilities end an employee’s capacity
to work; many, mercifully, do not. Surely the board, under the terms of this plan, could
make amendments to account for these features of disability benefits and many others,
even after an employee’s disability had occurred: the need to define, refine or redefine the
prerequisites of a disability; the frequency with which a former employee must certify that
a disability continues to exist; the number of doctors that must sign off on a medical
diagnosis; the need to account for set-offs for other benefits, including Social Security; or
the need to account for set-offs for income earned through a different job. As with these
permissible changes, so with an eventual ending of the benefit plan: The choice was the
trustees’, not ours. The tough reality is that the terms of the plan gave the trustees broad
authority to make amendments to the disability benefits provided to employees. Because
the trustees did not exercise that authority in an arbitrary and capricious way, we must
respect their choice.
The petition for panel rehearing is denied. Judge Jonker concurs in the result
The Clerk shall now refer the matter to all of the active members of the court for
further proceedings on the suggestion for en banc rehearing.
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