Knowlton et al v. Ansheuser-Busch Companies, LLC et al
MEMORANDUM AND ORDER GRANTING re: 89 PARTIAL MOTION for Judgment on the Pleadings filed by Plaintiff Gary Lensenmayer, Plaintiff Brian Knowlton, Consolidated Filer Plaintiff Joe Mullins, Consolidated Filer Plaintiff Donald W. Mills, Jr. , Consolidated Filer Plaintiff Andy Fichthorn, Plaintiff Charles R. Wetesnik, Plaintiff Douglas Minerd, Consolidated Filer Plaintiff Nancy J Anderson, Consolidated Filer Plaintiff Richard F. Angevine. Signed by District Judge Stephen N. Limbaugh, Jr on 7/8/15. (MRS)
UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF MISSOURI
BRIAN KNOWLTON, et al.,
individually, and on behalf of all
others similarly situated,
LLC, et al.,
No. 4:13-cv-210 SNLJ
MEMORANDUM AND ORDER
This matter is before the Court on plaintiffs’ motion for judgment on the pleadings
(#89) pursuant to Federal Rule of Civil Procedure 12(c). After an extended briefing
schedule, the motion has been fully briefed and is ready for disposition.
Plaintiff class members are former employees of Busch Entertainment Corporation
(“BEC”), which was a member of the “Controlled Group” of Anheuser-Busch Companies,
LLC (“ABC”). Plaintiffs further allege they are salaried participants in the
Anheuser-Busch Companies Pension Plan (“Plan” or “Pension Plan”).
The Pension Plan at the heart of this dispute provides, at Section 19.11(f), for certain
enhanced retirement benefits in case of a “change of control.” That Section states that a
salaried participant “whose employment with the Controlled Group is involuntarily
terminated within three (3) years after the Change in Control” is entitled to an enhanced
pension benefit that adds “an additional five (5) years of Credited Service” and “an
additional five (5) years of age” to the benefit calculation, an enhanced amount that “shall
in any event be at least fifteen percent (15%) larger” than the benefit to which the
participant would have otherwise been entitled (“+5/+5 benefits” or “enhanced benefits”).
In July 2008, Anheuser-Busch InBev, N.V. (“InBev”) announced that it was
acquiring ABC in November 2008 (the “Acquisition”). Plaintiffs allege that the
transaction was a “Change in Control” under the Plan. ABC stated to all salaried
employees in a memorandum that “if a participant in the [Plan] is involuntarily terminated
within three years after a change in control, the participant’s benefits will be determined
based on five additional years of age and credited service or by increasing the benefits by
15 percent, whichever provides the larger benefit.”
Sometime prior to November 2009, InBev announced that it was selling BEC to the
Blackstone Group and that the transaction (the “BEC Sale”) would be finalized on
December 1, 2009. Plaintiffs assert that, as a result of the BEC Sale, they and all other
similarly situated salaried employees of BEC had their employment with the Controlled
Group involuntarily terminated within three years of the Change of Control. However, in
November 2009 ABC informed the salaried employees of BEC that they “will not be
eligible for the +5/+5 enhancement upon the date of your termination of employment with
BEC after the sale is finalized.” Plaintiffs allege that when they filed a claim for the
enhanced benefits, the Plan Administrator denied the claim. Plaintiffs filed this lawsuit to
obtain the enhanced benefits through this ERISA action, and they have moved for
judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c) regarding
“Judgment on the pleadings is appropriate where no material issue of fact remains to
be resolved and the movant is entitled to judgment as a matter of law.” Faibisch v. Univ.
of Minnesota, 304 F.3d 797, 803 (8th Cir. 2002). When considering a motion for
judgment on the pleadings, the Court may consider the pleadings themselves, materials
embraced by the pleadings, exhibits attached to the pleadings, and matters of public record.
Porous Media Corp. v. Pall Corp., 186 F.3d 1077, 1079 (8th Cir. 1999).
Plaintiffs rely on and urge this Court to adopt the judgment of the United States
Court of Appeals for the Sixth Circuit in Adams v. Anheuser-Busch Companies, Inc., 758
F.3d 743 (6th Cir. 2014). That case presented the identical issue presented by plaintiffs
here --- plaintiffs in Adams were employed by a different ABC subsidiary, the Metal
Container Corporation, but were participants in the same Pension Plan as plaintiffs here.
After InBev acquired ABC, InBev spun off four of the Metal Container plants in a sale to
the Ball Corporation with the agreement that the Metal Container employees would
become employees of Ball and cease to be participants in the Pension Plan. Id. at 746.
As a result of that change in employment, the Adams plaintiffs made claims to the Pension
Plan administrator for recalculation of their future retirement benefits under Section
19.11(f) of the Plan. Id. “They contended that because their employment with an
Anheuser-Busch-affiliated Controlled Group company ended within three years of a
change in control, they were entitled to enhanced benefits from Anheuser-Busch at the
time of their retirement.” Id. ABC, of course, denied the claims because it said the
plaintiffs had accepted employment with Ball and so had never experienced a period of
unemployment. Id. The plaintiffs filed suit in the Southern District of Ohio, which
dismissed the plaintiffs’ claims for breach of fiduciary duty and for benefits and ultimately
upheld the administrator’s decision denying plaintiff’s claims. Id. The District Court
there held that the plan language was ambiguous and ruled that the Plan Administrator’s
decision was reasonable. On appeal, however, the Sixth Circuit reversed. Id. at 748.
Plaintiffs in this case urge this Court to follow the Sixth Circuit’s reasoning, and,
based solely on the pleadings, to grant partial judgment leaving only the matter of benefits
calculations left for disposition. In support, the plaintiffs state that this Court may apply
the doctrine of non-mutual collateral estoppel to prevent the defendants from further
defending this matter in light of the Adams decision. Naturally, the parties disagree
regarding whether applying such estoppel is appropriate here, and they devote most of the
briefing on this motion to debating it.
However, the Court need not engage in a complicated collateral estoppel analysis
nor need it wait for the submission of the administrative record. Although this is an
unusual case, the Court may resolve this issue on the pleadings. Defendants’ primary
objection to making a determination on the pleadings is that they insist on a full review of
the administrative record. That record, they say, includes the Plan, the employment
circumstances of the claimants, the relevant terms of the stock sale of BEC to the
Blackstone Group, past applications of Section 19.11(f), and the available evidence of the
Plan drafter’s original intent when drafting Section 19.11(f).
But defendants do not dispute that the sole issue is simply the meaning of Section
19.11(f), which states that individuals “whose employment with the Controlled Group is
involuntarily terminated within three (3) years after the Change in Control” would be
entitled to certain enhanced benefits. As explained in the pleadings, the Plan Administrator
believed that “involuntarily terminated” meant to have actually been terminated or lost
employment. The plaintiffs argue that “involuntarily terminated” must be read in the
context of their “employment with the Controlled Group” and does not require an actual
loss of employment. See also Adams, 758 F.3d at 747 (“The scope of the parties’
disagreement is narrow: they dispute only the meaning of the phrase “involuntarily
The only reason defendants could have to insist on a full review of the
administrative record, which is primarily evidence extrinsic to the Plan itself, is that the
defendants intend to argue --- as they did before the Sixth Circuit in Adams --- that Section
19.11(f) is ambiguous. However, as the Sixth Circuit held in Adams, the held, “the
language at issue is not ambiguous.” Id. at 749. The Eighth Circuit law regarding review
of this type of claim is clear and in agreement with the law applied by the Sixth Circuit in
When interpreting an ERISA plan, we first look for the intent
of the parties “by careful examination of the clause in question,
giving the words in that clause their ordinary meaning.”
Halbach v. Great–West Life & Annuity Ins. Co., 561 F.3d 872,
877 (8th Cir.2009). We examine the rest of the plan instrument
only “[i]f the construction question cannot be resolved by
reference to the clause alone.” Id. Extrinsic evidence may be
considered if “the intent or meaning of the [parties] ... cannot
be determined by reference to ... the instrument.” Id. at 877–
Windstream Corp. v. Da Gragnano, 757 F.3d 798, 803-04 (8th Cir. 2014), as corrected
(July 8, 2014), cert. denied sub nom. Commc’ns Workers of Am., AFL-CIO v. Windstream
Corp., 135 S. Ct. 1481 (2015). The law of the Eighth Circuit is thus that this Court may
only look beyond the Plan itself if the intent of parties cannot be determined by reference to
the Plan. And, as the Adams court has explained, there is no need to go beyond the words
of Section 19.11(f) at all.
The adjectival phrase “involuntarily terminated” describes
“employment.” In fact, it describes a specific type of
employment: “employment within the Controlled Group.”
Given the fact that “involuntarily terminated” has meaning
only when the thing that is being involuntarily terminated is
identified, and given that the phrase at issue in Section 19.11(f)
identifies the thing being terminated as “employment with the
Controlled Group,” it is clear that when each term in the
provision is understood according to its ordinary meaning, and
no term is ignored, eligibility for enhanced pension benefits
pursuant to Section 19.11(f) requires satisfaction of five
elements: (1) that the recipient be a plan participant (2)
whose employment with the Controlled Group (3) is
involuntarily terminated (4) within three years after (5) a
change in control.
Thus, when each of the terms in Section 19.11(f) is given its
ordinary meaning, the phrase “whose employment with the
Controlled Group is involuntarily terminated” is unambiguous
and has only one plausible interpretation. It requires only that
the individual’s employment with the Controlled Group be
involuntarily terminated, not that the individual experience a
job loss or some otherwise undefined period of unemployment.
Adams, 758 F.3d at 748-49. When the Sixth Circuit applied that provision to the facts of
the case, it concluded that
the plaintiffs’ employment with the Controlled Group was
“involuntarily terminated” when Anheuser–Busch sold Metal
Container to Ball and the plaintiffs became Ball employees.
The plan administrator’s decision to the contrary was therefore
arbitrary and capricious.
This Court agrees with the Sixth Circuit’s analysis. There is therefore no reason
for the Court to wait until the full “administrative record” is before it because to look
beyond the words of Section 19.11(f) itself would be improper. Partial judgment on the
pleadings will therefore be granted to plaintiffs on Count I.
IT IS HEREBY ORDERED that plaintiffs’ motion for partial judgment on the
pleadings (#89) is GRANTED.
day of July, 2015.
STEPHEN N. LIMBAUGH, JR.
UNITED STATES DISTRICT JUDGE
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