KIFAFI v. HILTON HOTEL RETIRE, et al

Filing 277

MEMORANDUM OPINION. Signed by Judge Colleen Kollar-Kotelly on 11/21/11. (lcckk2)

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
JAMAL J. KIFAFI, individually and on
behalf of all others similarly situated
Plaintiff,

Civil Action No. 98-1517 (CKK)

v.
HILTON HOTELS RETIREMENT PLAN,
et al.,
Defendants.

MEMORANDUM OPINION
(November 21, 2011)
Plaintiff Jamal J. Kifafi brought this action on behalf of himself and similarly situated
individuals for violations of the Employee Retirement Income Security Act of 1974 (“ERISA”),
as amended 29 U.S.C. §§ 1001 et seq., in the Hilton Hotels Retirement Plan. Defendants are the
Plan, the individual members of the Committee of the Plan, the Hilton Hotels Corporation, and
individual Hilton officers or directors (collectively, “Defendants” or “Hilton”). Presently before
the Court is Defendants’ [259] Motion for Clarification or in the Alternative Reconsideration,
seeking reconsideration of the Court’s August 31, 2011 remedial Order. Upon review of the
parties’ submissions, the relevant legal authorities, and the record as a whole,1 for the reasons

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While the Court’s decision is based on the record as a whole, including transcripts and
the Court’s prior Order, its consideration of Defendant’s motion has focused on the following
documents and associated exhibits, in chronological order of filing: ECF No. [211] Pl.’s Br. on
Equit. Relief; ECF No. [220] Defs.’ Resp. Br. on Equit. Relief; ECF No. [223] Pl.’s Reply Br. on
Equit. Relief; ECF No. [227] Defs.’ Sur-Reply Br. on Equit. Relief; ECF No. [236] Pl. Class’s
Br. on Unresolved Remedial Issues; ECF No. [240] Defs.’ Unresolved Remedial Issues Resp.
Br.; ECF No. [242] Pl. Class’s Resp. Br. on Unresolved Remedial Issues; ECF No. [259] Defs.’
Mot. for Clarification or in the Alt. Recons.; ECF No. [265] Pl.’s Opp’n to Defs.’ Mot.; ECF No.
[268] Defs.’ Reply in Supp. of Mot.; ECF No. [271] Pl.’s Sur-reply to Defs.’ Mot.

stated below, Defendants’ motion, is GRANTED IN PART and DENIED IN PART.
Defendants’ Motion is GRANTED to the extent that Defendants are not required to send union
service notice and claim forms to the 478 individuals Defendants identified would not vest even
with union service credit. Defendants’ motion, to the extent it seeks to limit the recipients of the
notice and claim forms based on the gap between hire/service date and the “first record of
service” in the Plan, is DENIED AS MOOT.
I. BACKGROUND
The history of this case is thoroughly discussed in the Court’s prior opinions, notably the
Court’s memorandum opinion on summary judgment, see Kifafi v. Hilton Hotels Retirement
Plan, 616 F. Supp. 2d 7 (D.D.C. 2009), as well as the Court’s opinions regarding equitable
remedies, see Kifafi v. Hilton Hotels Retirement Plan, 736 F. Supp. 2d 64 (D.D.C. 2010); Kifafi
v. Hilton Hotels Retirement Plan, No. 98-1517, 2011 WL 3836455 (D.D.C. Aug. 31, 2011). The
Court assumes familiarity with these opinions, but shall review the facts insofar as they are
relevant to the issues discussed herein.
On May 15, 2009, the Court granted in part Plaintiff’s motion for summary judgment.
See Kifafi v. Hilton Hotels Retirement Plan, 616 F. Supp. 2d 7 (D.D.C. 2009). In relevant part,
the Court found that Defendants had violated ERISA with respect to vesting of benefits under
the Plan, that is, the time of service required for an employee to obtain a right to his or her
accrued benefits. Under the Plan, employees who terminated after January 1, 1989 required five
years of service to become vested; employees terminated prior to that date needed ten years of
service. By its terms, the Plan required all periods of employment between the date of hire and
the date of termination be taken into account, including leaves of absence and union service. Id.

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at 29. The Court found that Defendants had violated the Plan’s vesting provisions with respect
to the rights of four certified subclasses (1) employees who did not receive credit for union
service for purposes of vesting (the class relevant to Defendants’ present motion); (2) employees
to whom the 1000 hours standard was not properly applied because of inadequate record
keeping; (3) employees who did not receive credit for leaves of absence; and (4) employees who
did not receive credit for the year in which they became participants in the Plan for vesting
purposes. Id. at 29-32. Accordingly, the Court ruled that the members of these vesting
subclasses should be awarded the vesting credit to which they are entitled.
The Court then ordered the parties to submit briefing regarding the equitable relief
appropriate to remedy the vesting violations. The Court’s September 7, 2010 ruling addressed
the parties’ proposed remedies. See Kifafi v. Hilton Hotels Retirement Plan, 736 F. Supp. 2d 64
(D.D.C. 2010). The Court rejected the Plaintiff’s proposal to count all periods of nonparticipating service as union service, and the Court likewise rejected Defendants’ proposal to
credit union service only where Plan records indicate union service. 616 F. Supp. 2d at 30.
Instead, the Court ordered Hilton to search its corporate records for information relating to
certain union service for 962 subclass members identified by Plaintiff, which must be credited
for vesting purposes, and ordered the parties to develop a joint proposal for the claims procedure
to be administered by Defendants to the remaining subclass members whose union service was
not confirmed by a search of Defendants’ records. See 736 F. Supp. 2d at 75-76.
The Court held a hearing on July 28 and 29, 2011 to address the outstanding remedial
issues, including the number of individuals to receive claim notices, and the contents of the
claim form itself. See 07/28/2011 Tr. at 81-105. While Plaintiff objected to the extent of

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Hilton’s record searches, the Court found Hilton had sufficiently searched the relevant records
likely to contain information regrading class members’ union service. 2011 WL 3836455 , at *56. Plaintiff also asked the Court to order Hilton to subpoena records from the unions to indicate
whether class members had union service, but the Court concluded that obtaining the
information directly from the class members was the preferred course of action. Id. at *6. As for
the individuals to receive the notice, Plaintiffs proposed that rather than limiting the subclass of
recipients of notice and claim forms to the 962 individuals previously identified, Hilton should
be required to sends notices to all individuals with hire or service dates that pre-date the first
year of participation in the plan, roughly 10,000 people. 07/28/11 Tr. at 81:13-82:4. Defendants
objected that many of these individuals could not possibly become vested because they did not
have sufficient years of service even if credited with union service. Id. at 93:7-11. Because
Defendants failed to keep adequate records of union service, the Court held that “Defendants
shall send a notice and claim form to members of the subclass whose records show a service date
or a hire date that precedes the first year of participation in the Plan and who may become vested
if such additional service is credited.” 08/31/2011 Order at 7. Plaintiffs were ordered to identify
the participants who should receive notice (later estimated at the hearing to be 9,700
individuals), and provide that information to Hilton, which would distribute the notice and claim
forms. The Court entered the final remedial Order on August 31, 2011, and Defendants filed the
present motion for reconsideration on September 28, 2011.
II. LEGAL STANDARD
Section 502(a)(1)(B) of ERISA allows a participant or beneficiary to bring a civil action
“to recover benefits due to him under the terms of his plan, to enforce his rights under the terms

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of the plan, or to clarify his rights to future benefits under the terms of the plan.” 29 U.S.C. §
1132(a)(1)(B). Pursuant to this provision, the Court may order that participants’ benefits be
recalculated consistent with the terms of the Plan. See Frommert v. Conkright, 433 F.3d 254,
270 (2d Cir. 2006) (“The relief that the plaintiffs seek, recalculation of their benefits consistent
with the terms of the Plan, falls comfortably within the scope of § 502(a)(1)(B).”).
ERISA also has a “catchall” provision, Section 502(a)(3), which allows a participant,
beneficiary, or fiduciary to “(A) enjoin any act or practice which violates any provision of this
subchapter or the terms of the plan, or (B) to obtain other appropriate equitable relief (i) to
redress such violations or (ii) to enforce any provisions of this subchapter or the terms of the
plan.” 29 U.S.C. § 1132(a)(3); Varity Corp. v. Howe, 516 U.S. 489, 507, 511 (1996). Where
relief is otherwise available under Section 502(a)(1)(B), equitable relief under Section 502(a)(3)
will not be “appropriate.” Varity Corp., 516 U.S. at 515. However, where a plan does not
conform with the requirements of ERISA, relief under the catchall provision may be appropriate.
The phrase “appropriate equitable relief” includes types of relief typically available in equity,
but it does not include compensatory or punitive damages. See Mertens v. Hewitt Assocs., 508
U.S. 248, 256-58 & n.8 (1993); id. at 258 n.8 (“‘Equitable’ relief must mean something less than
all relief.”). Courts have found that equitable relief is appropriate in ERISA cases where it
places participants “in basically the same financial position in which they would be if the
employer had complied with the minimum requirements necessary for the [plan] to satisfy the
accrual and vesting provisions of ERISA.” Carrabba v. Randalls Food Markets, Inc., 145 F.
Supp. 2d 763, 770-71 (N.D. Tex. 2000), aff’d, 252 F.3d 721 (5th Cir. 2001) (per curiam).
Federal Rule of Civil Procedure 52(b) provides that “[o]n a party's motion filed no later

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than 28 days after the entry of judgment, the court may amend its findings—or make additional
findings—and may amend the judgment accordingly.” Fed. R. Civ. P. 52(b). Rule 59(e) states
that “[a] motion to alter or amend a judgment must be filed no later than 28 days after the entry
of the judgment.” Fed. R. Civ. P. 59(e). “A Rule 59(e) motion is discretionary and need not be
granted unless the district court finds that there is an intervening change of controlling law, the
availability of new evidence, or the need to correct a clear error or prevent manifest injustice.”
Firestone v. Firestone, 76 F.3d 1205, 1208 (D.C. Cir.1996) (per curiam) (internal quotation
marks omitted). A motion to reconsider under Rule 59(e) “is [neither] ... an opportunity to
reargue facts and theories upon which a court has already ruled nor a vehicle for presenting
theories or arguments that could have been advanced earlier.” SEC v. Bilzerian, 729 F. Supp. 2d
9, 14 (D.D.C.2010) (internal quotation marks and citations omitted).
III. DISCUSSION
Defendants file the present motion asking the Court to clarify or reconsider the scope of
individuals that must receive notice and claim forms as part of the union service subclass.
Defendants’ motion initially sought to reduce its obligation from the 9,736 individuals identified
by Plaintiff as having a hire or service date that preceded the first year of participation in the
Plan, to the 962 individuals identified by Plaintiff during the first and second rounds of briefing
on remedial issues. Defs.’ Mot. at 7. In his opposition, Plaintiff reduced the list of recipients
from 9,736 to 3,129. See Pl.’s Opp’n, Ex. A to Decl. of Allison Pienta. Defendants’ Reply took
issue with sending notices to 39 individuals whom Hilton has already agreed to vest, and 478
individuals who could not become vested even if they had uncredited union service. Defs.’

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Reply at 4-5.2 The Court ordered a Sur-Reply from Plaintiff, to determine Plaintiff’s position
regarding Defendants’ objections to the revised list. 11/07/11 Minute Order. Plaintiff agreed
that the 39 individuals Defendants previously agreed to vest do not need to receive claim forms,
but disputed Hilton’s assertion that the group of 478 individuals should not receive notice and
claim forms. On November 15, 2011, Defendants mailed the union service notice and claim
forms to all but the 478 individuals still in dispute and 49 individuals for whom Hilton has not
yet identified a valid address. Defs.’ Status Report on Mailing of Union Serv. Notice and Claim
Forms, ECF No. [275], at 2. Thus the only issue remaining before the Court on Defendants’
motion is whether Hilton is required to send notice and claim forms to the 478 individuals Hilton
identified as having insufficient years of service, such that even if the time between the date of
hire or service and first year of Plan participation were credited as union service, the individual
would still lack sufficient service to become vested.
Defendants identify two purported errors in Plaintiff’s methodology that led to the
inclusion of the 478 individuals at issue. First, Plaintiff used 3.5 and 8.5 year “screens” to
determine if the individuals might have sufficient years of service to become vested, rather than
the 5 and 10 years required by the plan. Second, Plaintiff used a cut-off date of January 1, 1988
to determine whether the 5 or 10 year vesting requirement applied, as opposed to the actual Plan
cut-off date of January 1, 1989. Plaintiff defended both parameters on the grounds that Hilton’s
Plan records are incomplete and inaccurate, and thus the criteria used account for any possible

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Defendants also raised for the first time in their Reply an alleged clerical error in the
Court’s August 31, 2011 Order concerning the minimum accrual rate for pre-1982 service.
Plaintiff agreed that the Order mis-stated the rate. Pl.’s Sur-Reply at 9. The Court shall issue a
separate order addressing the error.
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errors. Pl.’s Sur-Reply at 3. The Court has previously rejected Plaintiff’s arguments, and
Plaintiff has shown no reason why the alleged inaccuracies in Hilton’s records compel a different
result here.
A.

General Inaccuracies

Plaintiff heavily relies on the Court’s statement during the remedies hearing that notices
should be sent to a “broader” group of class members than the initial 962 because of issues with
the records maintained by Hilton. Plaintiff also notes that the Court has previously recognized
Hilton did not “track non-participating service.” Pl.’s Sur-Reply at 3 (quoting 616 F. Supp. 2d at
29-30). Neither of these statements support Plaintiff’s inclusion of these 478 individuals. The
record indicates that in both instances the Court was referring to the fact that Hilton did not have
internal records regarding union service, but did not concern the accuracy of the hire, service,
participation, and termination dates in the Plan records. See 616 F. Supp. 2d at 29; 07/28/11 Tr.
at 91:12-92:3. The Court has never held that the Plan records contain systematic errors or
omissions regarding hire, service, termination, and plan participation dates as would be relevant
to determining who should receive notice and claim forms in the union service vesting subclass.
The lack of union service in the Plan records does not justify broadening the scope of recipients
using the “screens” and cut-off date employed by Plaintiff. As detailed below, on several
occasions the Court has rejected Plaintiff’s attempt to broaden the scope of relief based on the
basis of purported errors in the Plan records beyond the lack of union service records.
B.

Records Of Later Service

The first specific issue identified by Plaintiff is that the “Pnearn” database contains
records of service for some employees after 1988, which are not reflected in the Plan records.

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According to Plaintiff, this demonstrates that some individuals with no service after 1988 may
have service in 1989, and thus would be subject to the five year vesting requirement, justifying
Ms. Pienta’s use of the January 1, 1988 cut-off instead of the January 1, 1989 cut-off dated
dictated by the plan. Plaintiff’s Exhibit 4, which includes three individuals with Pnearn records
after 1988, is not compelling. Though the Pnearn records for Benny Briseno indicate he was
paid $20.36 in 1990, those records indicate Mr. Briseno did not record any hours of service for
1989 or 1990. Even with the Pnearn records, there would be no basis for believing Mr. Briseno
worked any hours after January 1, 1989 and would eligible for vesting with five years of service.
With only seven years of employment with Hilton, Mr. Briseno could not possibly vest under the
ten year requirement even with credit for union service, so there is no basis for sending him a
notice and claim form. The other two individuals identified in this exhibit, Leola Jefferson and
Larry Stead, do not have any pay or hours after January 1, 1989. As the Court previously
explained:
The relevant question, however, is not whether the individual continued to be
employed, but whether the employee had any additional hours of service. ERISA
defines an “hour of service” as “each hour for which an employee is paid, or
entitled to payment.” 29 C.F.R. § 2530.200b-2(a)(1). Thus, an employee may
remain on the payroll for a period of time without having any hours of service by,
for example, taking unpaid leave.
736 F. Supp. 2d at 77-78. Two different sets of records–the Pnearn and Plan records–confirm
these individuals do not have any hours of service after 1988, and thus “Plaintiff has not
provided the Court with any reasonable basis for presuming that [the] employee worked (or was
otherwise entitled to be paid) at least one hour” at any point after January 1, 1989. Id. Once
again, “Plaintiff provides no clear explanation as to why the Court should assume that there were
additional hours of service for employees between their last record of service and their date of
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termination of employment.” Id. at 77. These records do not provide any basis for finding the
Plan records are inaccurate or incomplete so as to justify sending notice and claim forms to
individuals who lack sufficient years of service to vest as proposed by Plaintiff.
C.

Early Closure Of Plan Records

Plaintiff also argues that it appears the Plan records for certain employees were
artificially terminated in 1988 to avoid the January 1, 1989 cut-off and maintain the ten year
vesting requirement. Plaintiff made this same argument in the context of the hours of service
class during the initial remedies briefing. See 736 F. Supp. 2d at 77 (“Plaintiff would also seek
an audit of termination dates of “12/31” to determine whether they are actual termination dates
or merely placeholders in the records.”). This argument is no more compelling in this context.
First, if Plaintiff questioned the reliability of the termination dates, it was Plaintiff’s obligation to
request other records to verify termination during discovery. With no basis on which to believe
these termination dates are inaccurate, the Court is not willing to shift the burden to Defendants.
This is particularly true given that Plaintiff’s own evidence indicates the “12/31/1988"
termination dates are accurate. The Pnearn records supplied by Plaintiff in Exhibit 5 do not
show any hours of service after 1988 for any of the five employees referenced by Plaintiff.
Shirley Rollins and Marcelle Jacquelyn received payments of $264 and $152 respectively in
1989, but the Pnearn records indicate that none of these individuals had hours after 1988. Using
Plaintiff’s additional evidence, all five of these individuals would be subject to the ten year
vesting requirement, and none would vest even with credit for union service. See Pl.’s Ex. 5 at
2, 5, 8, 11, 14 (showing none of the individuals have records of service prior to 1982, and thus
could not have recorded ten years of service prior to their termination in 1988). There is

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insufficient evidence to show the termination dates are inaccurate or designed to avoid the
January 1, 1989 cut-off date, therefore, there is no reason to burden Hilton with sending claim
notices to those individuals who could not possibly vest under the ten year standard.
D.

Status Codes Other Than Termination

Plaintiff further argues that Defendants unfairly seek to exclude sending notice and claim
forms to individuals whose Plan records do not use the code “T” for termination. Plaintiff’s
contention on this basis is rather disingenuous. Unlike the previous groups, Plaintiff does not
provide any Pnearn or other records indicating service after 1988 that might justify sending these
individuals claim forms. Moreover, Richard Bozzo could not possibly become vested even with
union service credit because the Plan records indicate he died in March of 1988. Pl.’s Ex. 6 at 1
(listing date of termination and date of death for Mr. Bozzo as March 12, 1988). The two other
individuals identified by Plaintiff, Dorothie Buckley and Frederick Miller, were terminated in
March and April 1988 respectively. Id. at 2-3. Regardless of the code used in the “Note”
section of the Plan records, the records clearly indicate these individuals were terminated, or
died, prior to 1989, and do not support Plaintiff’s allegation that the Plan records are inaccurate
or incomplete.
E.

Missing Termination Date

Plaintiff argues that some individuals Hilton seeks to exclude lack termination dates in
the Plan records, and thus could have sufficient hours to vest. Plaintiff’s Exhibit 7 shows
otherwise. Each of the individuals identified by Plaintiff have termination dates listed on the
Plan records provided to the Court. See Pl.’s Ex. 7 at 1 (07/26/1986 termination for Belk
William); id. At 2 (07/26/1986 termination for Philip McIntyre, Jr); id. At 3 (12/31/1985

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termination for G. J. Roberts). Though the relationship between the “terminated” and “Term Dt”
fields in the Plan records is not entirely clear, Plaintiffs have not provided any other evidence to
indicate these individuals might have sufficient service to vest even with union service. Given
that Plaintiff did not even attach the Pnearn records for these three individuals, the Court has no
basis on which to conclude that records of service exist elsewhere that might contradict the
termination date included in the Plan records and reasonably relied on by Hilton.
F.

Earliest Date of Hire

Plaintiff attempts to justify the use of 3.5 and 8.5 year screens for the vesting
requirements on the basis that the Plan records do not always show the earliest date of hire. The
Court previously rejected this argument in the initial remedial Order: “Plaintiff speculates that
‘the corporate records of hire dates are, in fact, likely to show additional service.’ If that is the
case, it was Plaintiff’s obligation to uncover that evidence during discovery and bring it to the
Court’s attention.” 736 F. Supp. 2d at 80 (citing Pl.’s Reply Brief on Equitable Relief, ECF No.
223, at 25). Plaintiff relies on the same evidence in his Sur-Reply as used in his Reply Brief on
Equitable Relief, and it is no more persuasive in this context. Plaintiff goes even further this
time in not seeking discovery as to the earlier hire dates, but attempting to shift the burden to
Hilton to not only send notice and claim forms, but also investigate hire dates in other records if
a claim is submitted by one of these individuals, when it was Plaintiff’s burden to request the
relevant record during discovery. The Court is unwilling to give Plaintiffs a third bite at the
apple on this issue.
G.

Original Subclass Members

Plaintiff’s final objection is to the footnote in Defendants’ Reply which indicates 65 of

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the 478 individuals at issue in Defendants’ motion were included in Plaintiff’s initial list of 962
individuals that should receive claim forms. Plaintiff argues that since Defendants’ counsel did
not object to the 962 at the remedies hearing, they should not be able to exclude these 65
individuals from receiving notice and claim forms. The Court disagrees. For the first time at the
remedies hearing—and at no point during the briefing on remedies—Plaintiff argued that
roughly 9,700 individuals in the union service class should receive notice and claim forms. At
no point has Plaintiff explained the connection between the 962 individuals initially identified,
the list of 9,700, or the final culled list of 3,129. Plaintiff’s definition of the subclass that should
receive notice claim forms has been a moving target, and the Court is not willing to hold
statements of Defendants’ counsel in reference to a now defunct list against Defendants in
determining the propriety of sending notices to 478 individuals when they could not possibly
vest even if credited with union service.
Furthermore, it appears Defendants would have objected to sending claim forms to these
65 individuals even if Plaintiff had continued to propose the list of 962 individuals. Defendants
proposed sending the notice and claim forms to only 126 individuals, and not 962, but preferred
962 to the 10,000 or more individuals Plaintiff proposed at the remedies hearing. See 07/28/11
Tr. at 86:12-20. Defendants’ Counsel was under the impression that the 962 individuals would
be “put over the top for vesting,” which would not necessarily be true for most of the group of
10,000 recipients. Id. at 93:2-11. Defendants have thus been consistent in their objection to
providing notice to individuals who could not possibly vest even with credit for union service, as
is true for the 65 individuals that were included in Plaintiff’s initial proposed group of recipients.
Absent any other reason why these 65 individuals should receive notice and claim forms, the

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Court finds that these individuals were properly excluded from the universe of recipients as they
could not possibly vest under the proper five and ten year vesting requirements.
IV. CONCLUSION
For the foregoing reasons, the Court finds that Defendants are not required to send notice
and claim forms to the 478 individuals that could not possibly become vested even if credited
with union service. Furthermore, the Court finds Defendants have not waived their objection on
this basis as to the 65 individuals included in Plaintiff’s initial list of 962 claim form recipients.
Accordingly, Defendants’ Motion for Clarification or in the Alternative Reconsideration is
GRANTED IN PART and DENIED IN PART. Defendants’ motion is GRANTED to the extent
that Defendants are not required to send union service notice and claim forms to the 478
individuals Defendants identified would not vest even with union service credit. Defendants’
motion, to the extent it seeks to limit the recipients of notice and claim forms based on the gap
between the date of hire/service and first year of participation in the plan is DENIED AS
MOOT.

Date: November 21, 2011
/s/
COLLEEN KOLLAR-KOTELLY
United States District Judge

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