Gulley v. International Paper Company
MEMORANDUM OPINION AND ORDER. Signed by Honorable Robert T. Dawson on May 10, 2012. (lw)
IN THE UNITED STATES DISTRICT COURT
WESTERN DISTRICT OF ARKANSAS
EL DORADO DIVISION
Case No. 10-1034
RETIREMENT PLAN OF
INTERNATIONAL PAPER COMPANY
MEMORANDUM OPINION AND ORDER
Plaintiff brings this action pursuant to the provisions of
the Employee Retirement Income Security Act of 1974, 29 U.S.C.
§§ 1001, et seq. (“ERISA”), alleging Defendant’s decision to
deny his claim for early retirement benefits was unreasonable.
Memorandum Brief in Support of its Motion for Judgment on the
Administrative Record (Doc. 17)1, Plaintiff’s Motion for Summary
Judgment (Doc. 19) and Defendant’s Brief in Response (Doc. 21).
For reasons reflected herein, Defendant’s Motion for Judgment on
did not file a response to Defendant’s Motion for
Judgment on the Administrative Record. The Court will treat
Plaintiff’s Motion for Summary Judgment as his response. “On or
about June 27, 2011, plaintiff’s counsel informed counsel for
defendant that he intended to rely on the motion for summary
judgment and supporting material facts filed on April 5, 2011,
and found at Docket Entries 11 and 12.”
(Doc. 17, p.2).
Defendant did not file a Motion for Judgment, only a Memorandum
Brief in Support. (Doc. 17).
Page 1 of 10
Motion for Summary Judgment (Doc. 19) is DENIED and Plaintiff’s
Complaint (Doc. 1) is DISMISSED WITH PREJUDICE.
On August 13, 1979, Plaintiff Bernest Gulley (“Gulley”) was
hired by International Paper Company (“International Paper”) to
work as an hourly employee at its Mill in Camden, Arkansas.
Gulley worked for International Paper until his termination on
July 19, 1991.
(Admin. Rec. p. 1). At the time his employment
International Paper’s Retirement Plan. (Doc. 1).
On April 2, 1999, he received a written
response from Direct Line advising that he was not eligible to
(Admin. Rec. p. 11).
The letter provided:
“You are, however, eligible for a deferred vested benefit when
retirement benefits are payable to you prior to age 55.” (Doc. 1
Page 2 of 10
On March 5, 2001, the Benefit Administration division of
International Paper’s Employee Service Center wrote to Gulley,
informing him that as of his termination in 1991, his vested
(Admin. Rec. p. 13).
On November 25, 2003, Gulley received another letter from
The letter informed Gulley that at the time of his
termination, in accordance with the plan document, an employee
must have 15 years of vesting service to be eligible for early
Since Gulley only had twelve years of service, he
was not eligible for early retirement.
(Admin. Rec. p. 19).
August 31, 2008, Gulley received an identical letter.
Rec. p. 33).
On April 26, 2010, Gulley filed his Complaint alleging that
he was entitled to retirement benefits from International Paper.
On July 26, 2010, Hon. Harry F. Barnes, United States
District Judge, granted the parties’ Joint Motion to Stay (Doc.
7) until Gulley exhausted his administrative remedies pursuant
to the Retirement Plan of International Paper Company.
On June 28, 2010, Gulley applied to the Retirement Plan for
Gulley provided a letter from his attorney, the April 2, 1999,
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letter from Direct Line and one page from the Retirement Plan’s
2003 Summary Plan Description2.
(Doc. 1 Ex. B).
International Paper forwarded to Gulley a copy of the Summary
Plan Description in effect on the date that Gulley left his job
at International Paper as well as a description of the claim
On October 25, 2010, the Retirement Plan denied Gulley’s
claim for early retirement benefits.
The Plan explained that
“[u]nder the Plan provisions in effect at the time of [his]
severance from employment with International Paper Company, a
participant needed at least 15 years of vesting service in order
because Gulley had only twelve years of service, he was not
eligible to receive early retirement benefits.
Plan also confirmed that Gulley would be eligible to receive a
vested retirement benefit of $220.33 per month when he reached
refers to the document as “Defendant’s Employee
(Doc. 20, p. 2).
International Paper states that
the document is page 11 from its 2003 Summary Plan Description.
The page reads, in relevant part, “The vested benefit payable at
your normal retirement date is calculated under the applicable
benefit formula based on your years of credited service in
effect as of the date you terminate employment.
benefit is payable as early as age 55 provided you have at least
10 years of vesting service.
If you choose to start receiving
your benefit before age 65, your benefit will be paid according
to the following schedule with proportional credit given for
partial years....” (Emphasis added). (Doc. 1 Ex. B).
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the age of 65.
In addition, the Retirement Plan informed Gulley
correspondence in 2001, 2003 and 2008.
(Admin. Rec. p. 88).
On November 1, 2010, Gulley appealed the denial of his
contention that he only needed ten years of service in order to
receive early retirement benefits, Gulley again submitted the
page from the 2003 SPD, describing it as the “Plan Booklet.”
(Admin. Rec. p. 127).
By letter dated December 13, 2010, the Plan Administrator
eligible to commence early retirement under the Plan based on
the provisions of the Plan in effect at the time of Mr. Gulley’s
informed Gulley that Section 1.29 of Article 1 of the Retirement
Employees (Group A) was the relevant provision in effect when he
left International Paper in 1991, and that, pursuant to that
provision, Gulley needed fifteen years of service to be eligible
for an early retirement benefit.
Because Gulley had only twelve
years of service when he left International Paper’s employment,
he “did not have the required number of years of service when he
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pension benefit. (Admin Rec. p. 446).
After his appeal was
resumed pursuit of his claim, asking this Court to find that he
is entitled to retirements benefits as well as attorney’s fees
International Paper Company.
II. STANDARD OF REVIEW
Under ERISA, a denial of benefits by a Plan Administrator
Administrator discretionary authority to determine eligibility
for benefits or to construe the terms of the Plan, in which case
discretion. Woo v. Deluxe Corp., 144 F.3d 1157, 1160 (8th Cir.
1998) (citing Firestone Tire & Rubber Co. v. Bruch, 489 U.S.
101, 115 (1989)). Accordingly, the Court must be guided by the
language of the Plan to determine the proper standard of review.
Administrator has the power and authority to interpret the Plan,
and to resolve ambiguities, inconsistencies and omissions, which
findings shall be binding, final and conclusive.
It further provides that all questions arising out of
or in connection with the administration of the provisions of
the Plan shall be determined by the Plan Administrator, and any
Page 6 of 10
determination so made shall be conclusive and binding upon on
all persons having an interest in or under the Plan.
Rec. p. 262).
In his brief, Gulley concedes that the Retirement
concerning benefits claims and to construe provisions of the
Plan. (Doc. 12).
Gulley contends that the Court should closely
scrutinize the entire record to determine if all aspects of
ERISA law were followed and all of the evidence was considered
by the Defendant.
(Doc. 20). Gulley also argues that the Court
should determine de novo what plan was in effect when he ceased
employment in 1991, averring that such a determination is not a
authority to construe the Plan and to determine a claimant's
reviewed under the arbitrary-and-capricious standard. Collins v.
Central States, Southeast and Southwest Areas Health and Welfare
Fund, 18 F.3d 556, 559 (8th Cir. 1994)(Trustees' determination
that an individual is ineligible to participate in the Fund
should be reviewed under the arbitrary-and-capricious standard.)
Page 7 of 10
reviewed for an abuse of discretion.
The Eighth Circuit has “variously defined . . . an abuse of
discretion as being ‘extremely unreasonable,’ ‘virtually’ the
imprudent.’” Shell v. Amalgamated Cotton Garment, 43 F.3d 364,
366 (8th Cir. 1994) (citations omitted). “The proper inquiry
substantial evidence.’” Cash v. Wal-Mart Group Health Plan, 107
F.3d 637, 641 (8th Cir. 1997) (quoting Donaho v. FMC Corp., 74
F.3d 894, 899 (8th Cir. 1996)). “While the word ‘reasonable’
such definition that would ‘permit a reviewing court to reject a
disagrees (.)’” Id. (citation omitted). A decision is reasonable
if “a reasonable person could have reached a similar decision,
given the evidence before him, not that a reasonable person
would have reached that decision.
If the decision is supported
by a reasonable explanation, it should not be disturbed, even
made.” Id. (citation omitted).
Page 8 of 10
The Plan Administrator determined that the Retirement Plan
in effect when Gulley was terminated from International Paper in
1991 was the plan approved by the Internal Revenue Service on
November 4, 1985, and which included amendments effective June
1, 1979, June 1, 1982, June 1, 1983, January 1, 1984 and January
1, 1986. (Admin Rec. pp. 171 - 437). That plan, as described in
the Summary Plan Description effective June 1, 1989, provided
that for an employee to receive early retirement benefits at the
age of 55 he or she must have accrued at least fifteen years of
explain where or how he received the page from the 2003 SPD, or
why it should apply to him twelve years after his employment
with International Paper ended.
The only argument that Gully
has for maintaining that he could receive retirement benefits at
age 55 is the letter from International Paper in 1999.
This was eight years after he terminated employment
with International Paper, so he could not have relied on that
erroneous information at the time of his termination.
advised Gulley that he had been given incorrect information and
that, under the applicable Plan, he did not have the hours of
creditable service required for early retirement.
Page 9 of 10
pp 13, 19, 33).
We find the Plan Administrator’s determination
Administrative Record (Doc. 17) is hereby GRANTED, Plaintiff’s
Motion for Summary Judgment (Doc. 19) is DENIED and Plaintiff’s
Complaint (Doc. 1) is DISMISSED with prejudice. Each party is to
pay their own costs and fees.
IT IS SO ORDERED this 10th day of May, 2012.
/s/ Robert T. Dawson
Robert T. Dawson
United States District Judge
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