Robello v. FedEx Express et al
ORDER GRANTING DEFENDANT'S MOTION FOR SUMMARY JUDGMENT AND DENYING PLAINTIFF'S MOTION FOR SUMMARY JUDGMENT 18 ; re 25 . Signed by JUDGE ALAN C KAY on 10/31/11. (eps)CERTIFICATE OF SERVICEParticipants regi stered to receive electronic notifications received this document electronically at the e-mail address listed on the Notice of Electronic Filing (NEF). Participants not registered to receive electronic notifications were served by first class mail on the date of this docket entry
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF HAWAII
FEDEX EXPRESS, JOHN DOES 1-5;
JANE DOES 1-5; DOE CORPORATIONS )
1-5; DOE PARTNERSHIPS 1-5; DOE )
NON-PROFIT ORGANIZATIONS 1-5;
DOE GOVERNMENTAL AGENCIES 1-5, )
Civ. No. 10-00571 ACK-BMK
ORDER GRANTING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT AND
DENYING PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT
On March 11, 2010, Collette Robello (“Plaintiff”) filed
a complaint in the Circuit Court of the First Circuit of the
State of Hawaii against Federal Express Corporation, doing
business as FedEx Express (“Federal Express” or “Defendant”),
alleging that Defendant breached a contract when it failed to
award Plaintiff benefits from Defendant’s Voluntary Severance
Incentives (“VSI”) plan.
Doc. No. 1-1.
The Complaint seeks
enforcement of the VSI plan, special damages, interest, and
attorney’s fees and costs.
Compl. Prayer for Relief.
Defendant removed the case to this Court on October 4,
2010, pursuant to 28 U.S.C. §§ 1331 and 1441, on the basis of
federal question jurisdiction, asserting that Plaintiff’s claim
is governed by the Employee Retirement Income Security Act of
1974, as amended, (“ERISA”), 29 U.S.C. § 1001 et seq.1
On January 3, 2011, Defendant filed the administrative
record (“A.R.”), to which Plaintiff did not object.
Doc. No. 15.
Defendant attached the declaration of Robin L. Marsh, a Senior
Paralegal for Defendant, which authenticated the record as
containing true and correct copies of the relevant documents.2
On April 21, 2011, Defendant filed a motion for summary
judgment (“Def.’s Motion”).
Doc. No. 18.
Defendant’s Motion was
accompanied by a supporting memorandum (“Def.’s Mot. Mem.”) and a
concise statement of facts (“Def.’s CSF”).
Doc. Nos. 18-1, 19.
On June 3, 2011, Plaintiff filed an opposition to Defendant’s
Motion (“Pl.’s Opposition”).3
Doc. No. 29.
On June 28, 2011,
Defendant alleged alternatively that this case was
removable based on diversity jurisdiction pursuant to 28 U.S.C.
§§ 1332 and 1441. Doc. No. 1. Because federal question
jurisdiction exists, it is unnecessary for this Court to decide
if the parties have diversity of citizenship and if the amount in
controversy is in excess of $75,000.
Marsh submitted a declaration that the original
administrative record in this matter is lost or destroyed, and
thus, pursuant to Federal Rule of Evidence 1004, Defendant used
its best efforts to recreate the record. Doc. No. 15 ¶ 3.
Parties that oppose a motion for summary judgment are
required to submit a “separate document containing a single
concise statement that admits or disputes the facts set forth in
the moving party’s concise statement, as well as sets forth all
Defendant filed a reply (“Def.’s Reply”).
Doc. No. 34.
On May 3, 2011, Plaintiff filed a Motion for Summary
Judgment (“Pl.’s Motion”).
Doc. No. 25.
Plaintiff’s Motion was
accompanied by a supporting memorandum (“Pl.’s Mot. Mem.”) and a
Concise Statement of Facts (“Pl.’s CSF”).
Doc. Nos. 25-1, 26.
On June 7, 2011, Defendant filed an opposition to Plaintiff’s
Motion (“Def.’s Opposition”) and an opposition to Plaintiff’s
Doc. Nos. 29-30.
The Court held a hearing on the motions on October 11,
At the hearing, Robello argued for the first time that
Defendant did not properly amend the VSI plan with regard to
participation limits and that it did not comply with the “Claims
Procedure” set forth in the VSI plan.
The court allowed
supplemental briefing on these arguments.
Defendant submitted a
supplemental brief (“Def.’s Supp. Br.”) on October 21, 2011, and
Plaintiff submitted a reply brief (“Pl.’s Supp. Reply”) on
October 24, 2011.
material facts as to which it is contended there exists a genuine
issue necessary to be litigated.” D. Haw. Local Rule 56.1(b).
“[M]aterial facts set forth in the moving party’s concise
statement will be deemed admitted unless controverted by a
separate concise statement of the opposing party.” Id. at
56.1(g). Plaintiff has not submitted a separate concise statement
opposing the facts set forth in Defendant’s CSF. Plaintiff has
submitted a CSF in support of her own motion. The facts set
forth in Plaintiff’s CSF do not controvert those set forth in
Defendant’s CSF. The facts contained in Defendant’s CSF will
therefore be deemed admitted.
The parties do not dispute the facts that are relevant
to the resolution of the present motions except whether Defendant
was required to amend the VSI plan to impose limitations.
Throughout the time period at issue, Plaintiff was employed by
Defendant as a manager.
2; Def.’s CSF ¶ 5.
Doc. No. 15-5, at A.R. 58; Pl.’s CSF ¶
On June 2, 2003, Defendant sent an e-mail to
its U.S. managers that explained an incentive program that
Defendant intended to use as part of a broad-based
Doc. No. 15-1, at A.R. 1-4.
included a Voluntary Early Retirement Incentives (“VERI”) plan
and a Voluntary Severance Incentives plan.
Doc. No. 15-1, at
Defendant stated that employees could request VSI plan
information packets between August 1 and October 6, 2003, and
that eligible employees would have from August 1 to November 24,
2003, to notify Defendant of acceptance of the VSI plan.
No. 15-1, at A.R. 2-3.
The VSI plan stated that Defendant
“reserves the right . . . to amend, modify, change or terminate
the Plan at any time.”
Doc. No. 15-2, at A.R. 11.
requested a VSI plan information package on August 5, 2003, and
received such package on August 13, 2003.
Doc. No. 15-7, at A.R.
61; Pl.’s CSF ¶ 3-4; Def.’s CSF ¶ 6-7.
Defendant sent a series of e-mails to its U.S. managers
regarding the VSI plan, and asked the managers to relay the
information to salaried employees.
Doc. No. 15-4.
16, 2003, Defendant sent an e-mail explaining that it appeared
the combined acceptance rates for the VERI and VSI plans might
exceed the position reduction goals for its reorganization and
thus it might have to limit participation in the VSI plan
Defendant stated that signed VSI agreements must be
returned before midnight on September 24 to avoid possible VSI
plan participation limits.
Id. at A.R. 50.
Defendant sent an e-
mail on September 18, 2003, asking employees to view a special
“FXTV” broadcast airing that day, which would provide, inter
alia, information about “recent changes to the Voluntary
Severance Incentive (VSI) program.”
Id. at A.R. 53.
September 22, 2003, Defendant informed its U.S. managers, via email, that updates had been posted to the “Voluntary Incentives
Intranet site” regarding, as relevant here, “[p]ossible
participation limits for VSI.”
Id. at A.R. 54.
in an e-mail sent October 2, 2003, that the number of employees
accepting the voluntary incentives had exceeded the number of
positions that Defendant had planned to eliminate.
Id. at A.R.
Thus, although it would continue to accept requests for the
VSI plan until November 24, Defendant stated it “will very likely
invoke participation limits on requests received after the
previously communicated deadlines (September 24 for most
Id. at A.R. 56.
Plaintiff executed her VSI plan agreement on October 8,
2003, and returned it to Defendant on October 10, 2003.
15-7, at A.R. 61; Pl.’s CSF ¶¶ 6-7.
After the initial denial of
Plaintiff’s request for the VSI plan, Plaintiff appealed.
No. 15-7, at A.R. 61.
In a letter dated March 10, 2004, the Plan
Administrator (Federal Express) denied Plaintiff’s appeal,
explaining that “[b]ecause more employees accepted the VSI
incentive than were required to implement the realignment of the
Express organization, it was necessary to limit participation.”
The Plan Administrator determined that because Plaintiff did
not submit her agreement by September 24, 2003, and she was not
in any group that was exempt from the program participation
limits, the decision to deny her request for the VSI plan was
Plaintiff challenges this decision.
The parties do not dispute that Plaintiff’s claim
relates to an employee benefit plan within the meaning of ERISA.
See Def.’s Mot. Mem. 3; Pl.’s Mot. Mem. 3.
In the absence of
certain exceptions not applicable here, ERISA preempts “any and
all State laws insofar as they may now or hereafter relate to any
employee benefit plan.”
29 U.S.C. § 1144(a); see Wise v. Verizon
Commc’ns, Inc., 600 F.3d 1180, 1190-91 (9th Cir. 2010).
Court therefore will construe Plaintiff’s breach of contract
claim as a claim brought under ERISA’s civil-enforcement
provision, which allows a claimant to bring a civil action “to
recover benefits due to [her] under the terms of [her] plan, to
enforce [her] rights under the terms of the plan, or to clarify
[her] rights to future benefits under the terms of the plan.”
U.S.C. § 1132(a)(1)(B).
Review of Defendant’s Denial of Benefits
Courts review de novo challenges to an ERISA plan's
denial of benefits “unless the benefit plan gives the
administrator or fiduciary discretionary authority to determine
eligibility for benefits or to construe the terms of the plan.”
Firestone Tire & Rubber Co. V. Bruch, 489 U.S. 101, 115 (1989).
Where a plan grants such discretion to a plan administrator, the
reviewing court applies an “abuse of discretion” standard.
Montour v. Harford Life & Accident Ins. Co., 588 F.3d 623, 629
(9th Cir. 2009).
Here, the VSI plan gives Federal Express the discretion
to determine eligibility for benefits and construe the terms of
The plan states that Federal Express “shall determine
the rights of any employee or former employee of [Federal
Express] to any Severance Benefits hereunder.”
Doc. No. 15-2, at
The plan also provides that Federal Express “shall have
sole and absolute discretion to interpret where necessary all
provisions of the Plan.”
Id. at A.R. 11.
The VSI plan therefore
unambiguously grants Defendant discretion to construe the terms
of the plan.
See Bergt v. Ret. Plan for Pilots Employed by
MarkAir, Inc., 293 F.3d 1139, 1142 (9th Cir. 2002) (concluding
that a retirement plan that granted the administrator the
“‘power’ and ‘duty’ to ‘interpret the plan and to resolve
ambiguities, inconsistencies and omissions’ and to ‘decide on
questions concerning the plan and the eligibility of any
Employee’” unambiguously gave the administrator the requisite
discretionary authority to support review for an abuse of
Plaintiff does not assert that Defendant is operating
under a conflict of interest, and thus this Court applies a
“straightforward application” of the abuse of discretion
See Montour, 588 F.3d at 629.
Accordingly, this Court
should set aside Federal Express’s discretionary decision if the
its determinations are arbitrary and capricious.
Verity, Inc., 606 F.3d 584, 590 (9th Cir. 2010).
administrator’s decision to deny benefits must be upheld under
the abuse of discretion standard if it is based upon a reasonable
interpretation of the plan’s terms and if it was made in good
Id. (internal quotations omitted).
Additionally, to the
extent Plaintiff challenges the merits of the Plan
Administrator’s decision, this Court’s review is limited to the
record before the Plan Administrator when it denied the claim.
See Montour, 588 F.3d at 632 & n.4.
Where a plan administrator’s decision to deny benefits
is reviewed for an abuse of discretion, and no conflict is
alleged, “a motion for summary judgment is merely the conduit to
bring the legal question before the district court and the usual
tests of summary judgment, such as whether a genuine dispute of
material fact exists, do not apply.”
See Bendixen v. Standard
Ins. Co., 185 F.3d 939, 942 (9th Cir. 1999), abrogated on other
grounds by Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955,
968 (9th Cir. 2006); see also Nolan v. Heald Coll., 551 F.3d
1148, 1154-55 (9th Cir. 2009).
Plaintiff bears the burden to show that she is entitled
to benefits under the VSI plan.
See Muniz v. Amec Constr. Mgmt.,
623 F.3d 1290, 1294-95 (9th Cir. 2010); Doyle v. Liberty Life
Assurance Co. of Boston, 542 F.3d 1352, 1360 (11th Cir. 2008).
In a letter dated August 1, 2003, and in an information sheet
sent as part of the “VSI packet,” Defendant stated that employees
deciding to accept the VSI agreement must return the agreement
“no later than November 24, 2003.”
Doc. No. 15-2, at A.R. 5, 7.
Defendant also, however, provided multiple notices to its U.S.
managers that employees who returned their VSI plan packages
after September 24, 2003, may be subject to plan limitations.
Doc. No. 15-4, at A.R. 50-57.
Plaintiff argues that this
September 24, 2003 deadline to avoid participation limits was an
invalid amendment to the VSI plan because Defendant did not
follow the amendment procedures set forth in the plan.
avers that it did not amend the plan.
Def.’s Supp. Br. 2.
Specifically, Defendant asserts that because the VSI plan set
forth terms and conditions in the event Federal Express exceeded
its goal for voluntary terminations, no amendment was necessary
to limit participation.
Id. at 2-3.
The Court agrees with Defendant.
The VSI plan defines
a “Qualifying Termination” as “[t]he voluntary election by an
Eligible Employee to sever his/her employment with the Company in
order to receive the benefits described herein, if such Eligible
Employee’s termination occurs no later than November 30, 2003,
except to the extent . . . his application is rejected because
the [Federal Express] has exceeded its goal for voluntary
retirements/terminations by Eligible Employees. . . .”
15-2, at A.R. 9 (emphasis added).
The VSI plan therefore
provided that Defendant might reject an employee’s application
because it exceeded its goal for offering the VERI and VSI plans.
The e-mail notifications sent by Federal Express were
administrative in nature and did not purport to amend the VSI
Plaintiff has failed to otherwise show that Defendant
amended the plan.
Plaintiff does not dispute that she received the
multiple e-mails notifying employees of potential limitations.
Rather, Plaintiff claims that because “[t]here is nothing in the
record to establish the need for participation limitations,” this
Court “cannot determine whether the denial of Plaintiff’s claim
for severance benefits was not an abuse of discretion.”
This Court disagrees and concludes that the record
establishes the Plan Administrator did not abuse its discretion.
The record reveals that on September 16, 2003, the
Defendant explained via e-mail that limitations on the number of
VSI plan packages approved may be imposed for those packages
submitted after September 24, 2003, because more employees had
accepted the VERI and VSI plans than anticipated.
explained that limitations may be necessary to meet its “goal in
offering [the VERI and VSI] incentive packages,” which was “to
balance as closely as possible the number of employees leaving
the company voluntarily with the planned position reductions
called for in our new structure.”
Doc. No. 15-4, at A.R. 50.
Federal Express upheld the denial of Plaintiff’s VSI
plan package because she did not return her agreement by
September 24, 2003, the deadline to avoid plan limitations.
No. 15-7, at A.R. 61.
Federal Express explained that “[b]ecause
more employees accepted the VSI incentive than were required to
implement the realignment of the [Federal] Express organization,
it was necessary to limit participation.”
decision to limit the number of VSI plan packages approved after
a certain date because the plan no longer furthered its purpose
in Defendant’s reorganization is not arbitrary and capricious.
Defendant’s decision is reasonable and Plaintiff has not alleged
Plaintiff’s final argument is that Defendant failed to
follow the “Claim Procedure” set forth in the VSI plan.
Supp. Reply 2.
Specifically, Plaintiff asserts that the Plan
Administrator’s decision did not comply with § 11(d) of the VSI
plan, which states, inter alia, that a denial of a claim by
Federal Express will include the specific reason(s) for the
denial and specific reference(s) to pertinent plan provisions on
which the denial was based.
Id. at 2.
Plaintiff, however, is
contesting the Plan Administrator’s decision on review.4
decision includes a specific reason for the denial but does not
include a reference to a plan provision.
Contrary to Plaintiff’s
assertion, it was not necessary for the decision on review to
cite a plan provision.
The VSI plan provides in a section titled
“Review of Claims” that the Plan Administrator will notify the
claimant of its decision on review and that the decision will be
Doc. No. 15-2, at A.R. 12.
It does not provide any
details about what the Plan Administrator will include in the
The record does not contain the denial of Plaintiff’s
Defendant provided its decision upholding the denial
of Plaintiff’s claim in writing in accordance with the VSI plan.
Plaintiff’s claim fails as a matter of law, and
Defendant is therefore entitled to judgment.
for summary judgment is denied for the same reasons Defendant’s
motion for summary judgment is granted.
For the foregoing reasons, the Court GRANTS Defendant’s
motion for summary judgment and DENIES Plaintiff’s motion for
IT IS SO ORDERED.
Honolulu, Hawai‘i, October 31, 2011.
Alan C. Kay
Sr. United States District Judge
Robello v. FedEx Express, et al., Civ. No. 10-00571 ACK-BMK, Order Granting
Defendant’s Motion for Summary Judgment and Denying Plaintiff’s Motion for
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