Vest v. The Nissan Supplemental Executive Retirement Plan II et al
Filing
171
MEMORANDUM OPINION OF THE COURT. Signed by District Judge Eli J. Richardson on 8/29/2022. (DOCKET TEXT SUMMARY ONLY-ATTORNEYS MUST OPEN THE PDF AND READ THE ORDER.)(kc)
IN THE UNITED STATES DISTRICT COURT FOR THE
MIDDLE DISTRICT OF TENNESSEE
NASHVILLE DIVISION
REBECCA VEST,
Plaintiff,
v.
THE NISSAN SUPPLEMENTAL
EXECUTIVE RETIREMENT PLAN II
and NISSAN NORTH AMERICA,
INC.,
Defendants.
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NO. 3:19-cv-01021
JUDGE RICHARDSON
MEMORANDUM OPINION
Pending before the Court is Plaintiff Rebecca Vest’s Motion for Judgment on the Pleadings
(Doc. No. 85, “Motion”), filed along with a sealed exhibit (Doc. No. 88-1) and memorandum of
law (Doc. No. 88-2).1 Defendants filed a response under seal. (Doc. No. 97).2 Plaintiff replied
under seal. (Doc. No. 102).3
BACKGROUND4
A. Factual background
Plaintiff joined Nissan North America, Inc. (“Nissan”) in October 2009 as the Director of
the Renault-Nissan Purchasing Organization. (Doc. No. 41 at ¶ 12). In its employment offer,
1
The Court herein cites to the sealed, unredacted versions of any relevant filings. Plaintiff also filed an
unsealed, redacted version of her supporting memorandum of law. (Doc. No. 86).
2
An unsealed, redacted version of Defendants’ response was also filed. (Doc. No. 95).
3
An unsealed, redacted version of Plaintiff’s reply was also filed. (Doc. No. 100).
4
The Court cites herein to the Amended Complaint (Doc. No. 41) for any facts that are undisputed by
Defendants (or otherwise “unable to be confirmed or denied” by Defendants), and cites to the Answer to
the Amended Complaint (Doc. No. 45) for any disputed facts.
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Nissan informed Plaintiff that she would be eligible to participate in The Nissan Supplemental,
Executive Retirement Plan II (Doc. No. 41-1, the “Plan”). (Id. at ¶ 13). In February 2011, Plaintiff
was promoted to Vice President of Purchasing for Nissan North America. (Id. at ¶ 15). Plaintiff
served in this position until April 2016 when Nissan restructured, at which time she became Vice
President of Corporate Development and Social Responsibility. (Id. at ¶ 16). Plaintiff worked in
this role until September 21, 2018, her last day of employment, which was two weeks after her
submission of her resignation. (Id. at ¶¶ 16, 20). By then, Plaintiff had worked for Nissan for a
total of nine years. (Id. at ¶ 22).
After leaving Nissan, Plaintiff accepted a position with Bridgestone. Bridgestone’s primary
business is the manufacture and sale of tires and other rubber products, which it supplies to clients
like Nissan and “to OEMs [original equipment manufacturers] that directly compete with NNA.”5
(Id. at ¶¶ 24, 26; Doc. No. 45 at ¶ 24, 26). Plaintiff’s position with Bridgestone is Senior Vice
President of Procurement and Strategic Sourcing Partnerships. (Doc. No. 41 at ¶ 27). In this role,
Plaintiff’s “job duties relate to procurement in support of Bridgestone’s businesses. Generally, her
role is to define and manage commodity strategies and sourcing decisions, while ensuring business
supply requirements are satisfied. As part of her sourcing responsibilities, [Plaintiff] also oversees
Bridgestone’s Firestone Natural Rubber business in Liberia.” (Id.). Bridgestone “announced” that
Plaintiff would be “responsible for leading the integrated procurement organization at
The Court uses Defendants’ quoted language here and accepts as true that Bridgestone supplies to
companies that directly compete with NNA. In so doing, however, the Court does not accept as true that
Bridgestone (as opposed to automobile manufacturers that compete with NNA) is a “Competing Company”
for purposes of the Plan. The Court will discuss this topic in detail below.
5
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Bridgestone” and would be “working across the Americas with consumer and commercial tire
businesses, marketing, and logistics and supply chain.” (Doc. No. 45 at ¶ 28).6
The Plan
The Plan states that “[a] member of Senior Management of the Company7 (as defined in
Exhibit I) is eligible to become a Participant in the Plan; provided that such employee is confirmed
as a Participant by the Administrative Committee in writing.” (Doc. No. 41-1 at ¶ 2.1(a)). Exhibit
I, in its entirety, states, “A member of Senior Management means a Director, Vice President, or
Senior Vice President [(“SVP”)] of the Company, and such other senior level employee of the
Company as may be approved from time to time by the Board of Directors of the Company or its
delegate or Administrative Committee.” (Id. at 22). The Plan defines “Participant” as “an
employee of the Company who meets the eligibility requirements of Section II and is confirmed
as set forth in Section II.” (Id. at ¶ 1.12). “A Participant must attain a minimum of five (5) years
of Participation Service in order to be eligible to receive a Supplemental Plan Benefit.” (Id. at ¶
3.2).
The Claims Procedure
Section 7.12 of the Plan, entitled “Claims Procedure,” states at the outset that “[b]enefits
shall be paid in accordance with the provisions of this Plan.” (Doc. No. 41-1 at 17). It then sets
In the Answer, Defendants contend that they are “without information or belief sufficient to admit or deny
the allegations of Paragraph 27 [of the Amended Complaint],” which concerns Plaintiff’s job duties at
Bridgestone. (Doc. No. 45 at ¶ 27; Doc. No. 41 at ¶ 27). Yet in the very next paragraph of the Answer,
Defendants expressly purport to have knowledge of what “Bridgestone announced” would be Plaintiff’s
job responsibilities at Bridgestone. (Doc. No. 45 at ¶ 28). Defendants do not identify where this
announcement was made, or take a position as to the accuracy of this “announce[ment],” or allege that these
in fact ever have been Plaintiff’s actual job duties at Bridgestone.
6
The Plan defines “Company” as “Nissan North America, Inc. [i.e., “Nissan,” as that term has been coined
above by the Court], any successor thereto, and any Affiliated Company that has adopted this Plan in
accordance with Section IX.” (Doc. No. 41-1 at ¶ 1.7).
7
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forth the procedure for the making, determination, and (potential) payment of a claim made by a
claimant. First, the claim must be made in writing to the Claims Official (who is appointed by the
Administrative Committee). (Id. at ¶ 7.12(a)). The Claims Official then, “within a reasonable
time,” considers the claim and issues a determination in writing. (Id. at ¶ 7.12(b)). If the claim is
granted, “the appropriate distribution or payment shall be made” as a lump sum “during the month
following the six month anniversary of the last day worked.” (Id. at ¶¶ 7.12(c), 3.4).
If the claim is denied wholly or in part, the Claims Official must (within 90 days) provide
a written notice of the denial that includes the reason for denial, the provision on which the denial
is based, a description of additional material or information necessary to “perfect” the claim, and
an explanation of the claim review procedure. (Id. at ¶ 7.12(d)). The Claims Official must provide
the claimant a “reasonable opportunity to appeal the denial of a claim to the Administrative
Committee (or other duly appointed review official),” and may establish a deadline for requesting
review of a denial (as long as such deadline is at least 60 days after receipt of a denial).8 (Id. at ¶
7.12(e)-(f)). The “review official”—a term that clearly is intended to refer to the Administrative
Committee if there is no “other duly appointed review official” with respect to the appeal—then
must render a decision no later than 60 days after receiving the request for review, although the
Administrative Committee can extend the decision deadline for up to 60 days if special
circumstances so warrant. (Id. at ¶ 7.12(g)).
“The decision must be in writing and shall include specific reasons for the decision written
in a manner calculated to be understood by the claimant with specific references to the pertinent
The Claims Procedure uses the word “appeal” as a verb only in this one place, and does not use the word
“appeal” as a noun. As used here, the verb “appeal” appears synonymous with “request a review,” which,
in various permutations, is the term otherwise used in the Claims Procedure. Notably, despite the
terminology suggesting that a claimant has the right only to merely request a review of a denial of claim,
the Claims Procedure clearly contemplates that a claimant actually has a right to receive a review upon a
timely request for review.
8
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Plan provision on which the decision is based.” (Id. at ¶ 7.12(h)). “In considering claims, the
Administrative Committee, the review official, and the claims official shall have full discretionary
power and authority to make findings of fact and to construe the terms of the Plan and, to the full
extent permitted by law, the determination of the claims official (if no review has been properly
requested) shall be final and binding on all parties unless held by a court or arbitrator to constitute
an abuse of discretion.” (Id. at ¶ 7.12(i)). Any “further review of claims”—as might naturally be
requested by a Participant disappointed by the review official’s decision—“shall be solely through
confidential arbitration[.]” (Id. at ¶ 7.12(j)).
Subsection 2.3(b)’s non-competition provision
The Plan includes a non-competition (non-compete) provision, which states that an
employee must refrain from:
either directly or indirectly, solely or jointly with other persons or entities, owning,
managing, operating, joining, controlling, consulting with, rendering services for
or participating in the ownership, management, operation or control of, or being
connected as an officer, director, employee, partner, principal, agent, consultant or
other representative with, or permitting his/her name to be used with any business
or organization (a “Competing Company”) with which the Company competes.
(Id. at ¶ 2.3(b)). The Court previously explained the mechanics of this provision:
[The non-competition provision] indicates that if a Plan participant is suspected of
having committed any such violation, the SVPs must vote to determine whether she
has in fact committed such violation(s), in which case she is effectively disqualified
from receiving any further payment under the Plan. Beyond suggesting that a
finding (by majority SVP vote) of such disqualifying violation(s) could occur at
any time while the Company otherwise has “further obligation to make . . .
payment”—i.e., has not made all payments otherwise due to the Plan participant—
this subsection otherwise provides no information at all (and certainly no details)
on when or how this vote should occur. And Section 3.4 of the Plan provides that
payment under the Plan is made in a single lump sum paid “during the month
following the six month anniversary of the last day worked.” (Id. at 12.) The time
of payment thus identified naturally would arrive after the institution of the Claims
Procedure of Section 7.12—after the making, and perhaps even after the granting
or denying, of a claim under the Claims Procedure.
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The subsection thus indicates that the SVP vote does not necessarily have to be
made at the outset of the Claims Procedure for a participant’s claim for benefits and
could instead be made after an initial determination of a claim. The language of this
provision (and its location in the Plan), indicate to the Court that it is not part of the
Claims Procedure, but rather a different avenue that Defendants can use at any time
(even after a decision to grant benefits) to deny benefits to a Plan beneficiary
deemed to have committed a violation of the kind referred to in subsection 2.3(b).
Thus, subsection 2.3(b) itself does not suggest that a determination by SVPs that an
employee did not commit the violations referred to in subsection 2.3(b) is a step in
the Claims Procedure, let alone a step that must come before any particular step(s)
in the Claims Procedure set forth in Section 7.12. Instead, the provision suggests
that any determination as to whether an employee committed the violations referred
to in Subsection 2.3(b) is a determination made (if at all) outside of the Claims
Procedure, at an unspecified time not tied in any way to the steps of the Claims
Procedure.
(Doc. No. 34 at 17).
Plaintiff’s claim for benefits
At some point,9 Plaintiff submitted a claim for benefits under the Plan.10 On April 5, 2019,
the Vice President for Human Resources at Nissan sent what she deemed an “advisory position”
to Plaintiff that stated that “[the Administrative] Committee historically has not allowed employees
to collect benefits and work for vendors that provide products or services to OEMs, unless their
work related exclusively to Nissan/Infiniti or Nissan/Infiniti dealers” and that
[s]ince the publicly available information regarding [Vest’s] position indicates that
[Vest] [is] not able to work exclusively with or for the benefit of Nissan/Infiniti,
the [Administrative] Committee has decided that under the terms of the SERP II,
[Vest] [is] not permitted to work for a vendor that provides products to multiple
OEMs and collect SERP II benefits.
9
Despite scrutinizing the record, the Court does not see any indication of when Plaintiff made her claim.
The Court uses the term “benefits” (plural) to refer to a monetary payment that the Plan refers to as the
“Supplemental Plan Benefit” (singular).
10
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(Doc. No. 41-2, “Advisory Position”). Notably, when referring to “OEMs,” the Advisory Position
was referring specifically to automobile manufacturers.11 The Advisory Position also stated that
unless Plaintiff “provide[d] written confirmation that [she] is not providing products and services
to other OEMs, [her] SERP II benefit will be forfeited pursuant to Section 2.3(b) of the Plan.”
(Id.).
In the Answer, Defendants state that via the Advisory Position, “Defendants notified
Plaintiff that her request for Plan benefits had been accordingly denied,” (Doc. No. 45 at ¶ 8), and
the Court accepts as true the assertion of Defendant (the non-movant) that the Advisory Position
amounted to a denial; however, the Advisory Position does not premise this denial on Plaintiff not
This is clear from the fact that the Advisory Position refers to “Nissan as well as other OEMS such as
General Motors, Fiat Chrysler, Porsche, Audi, BMW, and Lexus.” (Doc. No. 41-2). Though the Court does
not rest its holding on this point, the Court also finds that any conclusion that “OEM” is equivalent to
“automobile manufacturer” goes against the plain meaning of the term “OEM.” According to Investopedia
(which strikes the undersigned as reasonably reliable on this point, and which seems uncontroversial in any
event), "OEM” stands for “original equipment manufacturer” and is defined as “a company whose goods
are used as components in the products of another company, which then sells the finished item to users.”
Original Equipment Manufacturer (OEM), Investopedia https://www.investopedia.com/terms/o/oem.asp
(last visited August 22, 2022). It would seem that an automobile manufacturer, such as Nissan, thus falls
under the category of the “other” (non-OEM) company for purposes of this definition, because the
automobile manufacturer is the entity that assembles the parts manufactured by the OEM and sells the
finished item to auto dealers (who in turn sell to consumers). This is what Investopedia indicates: “One of
the most basic examples of an OEM is the relationship between an auto manufacturer and a maker of auto
parts. Parts such as exhaust systems or brake cylinders are manufactured by a wide variety of OEMs. The
OEM parts are then sold to an auto manufacturer, which then assembles them into a car. The completed car
is then marketed to auto dealers to be sold to individual consumers.” Id. That is to say, in the context of
automobile manufacturing, “[t]he OEM is the original producer of a vehicle's components . . . .” What Is
an Original Equipment Manufacturer (OEM) in the Automotive Sector?, Investopedia,
https://www.investopedia.com/ask/answers/041515/what-original-equipment-manufacturer-oemautomotive-sector.asp (last visited August 22, 2022). The undersigned does not work in this industry, and
so perhaps he (and/or Investopedia) could be missing something. But for the reasons just stated, the Court
simply does not see how an automobile manufacturer, like Nissan or the others listed in the Advisory
Position, could be an OEM.
For this reason, when speaking in its own voice, the Court herein will paraphrase the term
“OEM[s]” as “automobile manufacturers.” And when its quotes references of the parties—including
Plaintiff, who appears to go along with the notion that “OEM[s]” means “automobile manufacturers”— to
“OEM[s],” it is with the understanding that the reference is specifically to automobile manufacturers.
11
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being eligible for benefits, but rather on Plaintiff’s benefits being subject to forfeiture (unless
Plaintiff thereafter provided the specified “written confirmation”). (Doc. No. 41-2).
On May 17, 2019, Plaintiff responded (through counsel) to the Advisory Position with a
request for review. (Doc. No. 41-3 at 1).12 In this response, Plaintiff also objected to Defendants’
interpretation of the non-competition provision and responded to Defendants’ request for written
confirmation that she does not provide products and services to other OEMs:
Third, to the extent the [Administrative] Committee is concerned that Ms. Vest's
particular job duties with Bridgestone involve "rendering services for" other OEMs
as Competing Companies, the Committee is mistaken. Ms. Vest's position with
Bridgestone is Senior Vice President of Procurement and Strategic Sourcing
Partnerships. Her job title alone indicates that her position is focused on the supplychain for Bridgestone's non-competitive tire manufacturing business, not sales to
Nissan or any other OEM. Ms. Vest's job duties consist of sourcing and procuring
goods and services for Bridgestone, including raw materials for the production of
tires and other rubber products. Vest Aff. ¶¶ 18-19. She has no contact or
relationship with any OEM, and cannot be said to "render[] services for" any OEM
through her work with Bridgestone. Id.
(Id. at 3–4).
As indicated above, the Claims Procedure contemplates a “review” only of a denial of a claim. Plaintiff
takes the view that the Advisory Position does not really contain any “decision” (to deny benefits) such that
a request for review of any “decision” (i.e., denial) could be made; thus, Plaintiff states that she submitted
this request only “[t]o the extent the Advisory Position is a decision [i.e., denial].” (Doc. No. 41 at 3). The
Court notes that if the Advisory Position was in fact not a “denial,” Plaintiff arguably prematurely requested
a review. But if the Advisory Position was not in fact a denial, it was incumbent upon Defendants to
communicate as much to Plaintiff (particularly because the Plan does not mention the possibility of an
“advisory position” being a step in the Claims Procedure). So Plaintiff, faced with an “Advisory Position”
that was not clearly a denial of her request for benefits, took a reasonable course of action in making a
request for a review with the added caveat that such request was being made only to the extent that the
Advisory Position was actually a decision (i.e., a decision to deny Plaintiff benefits). In any event, as
explained further below, the Court on balance does view the Advisory Position to constitute a “denial” such
that it was appropriate for Plaintiff to request a review.
12
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The SVPs voted to sustain the denial of Plaintiff’s request for Plan benefits, and Defendants
thereafter notified Plaintiff of the SVPs’ decision. (Doc. No. 45 at ¶ 8).13 Plaintiff responded by
filing the present lawsuit.
B. Procedural background14
Plaintiff brings causes of action for 1) denial of benefits in violation of ERISA, and 2)
breach of contract. (Doc. No. 41). Defendants brought a motion to dismiss the case or, in the
alternative, to compel arbitration, which the Court denied. (Doc. No. 35). Plaintiff filed the instant
Motion, which seeks judgment on the pleadings on Count I of the Amended Complaint for
recovery of benefits, under 29 U.S.C. § 1132(a)(1)(B). Plaintiff also seeks via the Motion the
voluntary dismissal of Count II (breach of contract) pursuant to Fed. R. Civ. P. 21 as being
preempted by ERISA. (Doc. No. 85 at 2).
Plaintiff attaches to her Motion a set of e-mails reflecting the SVPs’ vote. (Doc. No. 88-1). And although
both parties referred to this filing in their briefing on the Motion, this document was neither attached to nor
referred to in the Amended Complaint (or, for that matter, the Answer thereto), nor was it attached to the
pleadings. Therefore, because the instant Motion is one for judgment on the pleadings, as discussed below
the Court cannot consider this document or its contents when ruling on the Motion without converting it to
one for summary judgment. Max Arnold & Sons, LLC v. W.L. Hailey & Co., 452 F.3d 494, 503 (6th Cir.
2006). The Court finds it most appropriate to exclude this item, and thus it need not treat the Motion as one
for summary judgment.
13
Also pending before the Court is Plaintiff’s Motion for Judgment on the Administrative Record (Doc.
No. 140). Defendants argue that “the Court’s review of a benefits determination must consider the
administrative record in accordance with the appropriate standard of review.” (Doc. No. 97 at 19).
Defendants cite Goetz v. Greater Ga. Life Ins. Co., 649 F. Supp. 2d 802, 811 (E.D. Tenn. 2009), McDonald
v. W.-Southern Life Ins. Co., 347 F.3d 161, 172 (6th Cir. 2003) and Wilkins v. Baptist Healthcare Sys., Inc.,
150 F.3d 609, 619 (6th Cir. 1998). None of these cases forbid a district court from ruling on a motion for
judgment on the pleadings or require that ERISA claims be handled via a motion for judgment on the
administrative record. Instead, they simply set forth the legal standard applicable when the Court is deciding
(despite not necessarily being required to decide) a motion for judgment on the administrative record in an
ERISA case.
Defendants also argue that Plaintiff engaged in sanctionable behavior merely by filing this motion
in the midst of ongoing discovery requests, citing a case that says “repeatedly filing meritless and redundant
materials” can be sanctionable. (Doc. No. 97 at 21–22). This argument fails. In the absence of any stay of
discovery, Plaintiff has every prerogative and reason continue to prosecute the case, including by
conducting discovery, while her Motion remained pending. And as the Court explains below, the present
Motion is certainly not meritless.
14
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LEGAL STANDARD
The Federal Rules of Civil Procedure provide that after the pleadings are closed, but within
such time as not to delay the trial, any party may move for judgment on the pleadings. Fed. R. Civ.
P. 12(c). To evaluate a defendant’s Rule 12(c) motion, the court proceeds as it would on a Rule
12(b)(6) motion; that is, it reviews the complaint in the light most favorable to the nonmoving
party, accepts the complaint’s well-pled factual allegations as true, and determines whether the
moving party is entitled to judgment as a matter of law. Commercial Money Center, Inc. v. Illinois
Union Ins. Co., 508 F.3d 327, 336 (6th Cir. 2007). However, in cases like the present one, where
the party moving for judgment on the pleadings is the plaintiff rather than the defendant, a
somewhat different standard is required. In considering a motion by the plaintiff for judgment on
the pleadings, the Court will determine whether “on the undenied facts alleged in the complaint
and assuming as true all the material allegations of fact in the answer, the plaintiff is entitled to
judgment as a matter of law.” Lowden v. Cty. of Clare, 709 F. Supp. 2d 540, 546 (E.D. Mich. 2010)
(quoting U.S. v. Blumenthal, 315 F.2d 351, 352 (3d Cir. 1963) (“[T]he question is whether the
facts alleged in the answer are material in the sense that, if proved, they will constitute a legal
defense to the plaintiff's claim.”)).
As a general rule, if matters outside the pleadings are presented on a Rule 12(c) motion and
not excluded by the court, the motion must be treated as one for summary judgment under Rule
56. Fed. R. Civ. P. 12(d). Max Arnold & Sons, LLC, 452 F.3d at 503 (“Because Plaintiff presented
matters outside of the pleadings with respect to Defendant’s Rule 12(c) motion, and because the
district court did not exclude these matters, the district court should have converted the Rule 12(c)
motion to a motion for summary judgment.”). This applies even if the non-excluded material
outside the pleadings is not actually relied upon or even considered at all by the court. See id.
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However, “matters of public record, orders, items appearing in the record of the case, and exhibits
attached to the complaint[ ] also may be taken into account” without converting the motion into a
summary judgment motion.15 Barany-Snyder v. Weiner, 539 F.3d 327, 332 (6th Cir. 2008) (quoting
Amini v. Oberlin Coll., 259 F.3d 493, 502 (6th Cir. 2001)). Notably, the Court has not considered
any information that would mandate conversion of the instant Motion into one for summary
judgment.
ANALYSIS
Plaintiff argues that she is “entitled to judgment on the pleadings because she was eligible
for her SERP II benefits, her benefits vested,16 and Nissan’s SVPs did not vote to deny her benefits
Even if exhibits attached to the answer likewise could be considered on a plaintiff’s Rule 12(c) motion,
that would make no difference here because no exhibits were attached to Defendants’ Answer to the
Amended Complaint.
15
The Plan states that the Administrative Committee has discretion to determine “all issues relating to
eligibility to participate and vesting in accordance with the Plan.” (Doc. No. 41-1 at ¶ 7.5 (emphasis
added)). The sentence structure here perhaps initially suggests that “[achieving] eligibility” and “vesting”
are two distinct requirements for entitlement to benefits under the Plan. But this possibility is refuted by the
only other instance in which any variation of the word “vest” (which coincidentally of course happens also
to be the last name of Plaintiff) is used. There, the Plan states, “In the case of a Plan termination, each
actively employed Participant on the termination date of the Plan, regardless of length of Participation
Service, will become vested in his accrued Supplemental Plan Benefit as of the Plan termination date.” (Id.
at ¶ 6.2). This indicates that “becom[ing] vested” is a status (a desirable one, from the point of view of a
claimant) applicable in the case of Plan termination, rather than a requirement for entitlement to benefits;
it also indicates that the concept of “becom[ing] vested” is simply inapplicable in the instant context, which
involves no termination of the Plan.
Neither side discusses the meaning or implications of the words “vest[ing]/vest[ed]” as it appears
in the Plan, let alone suggest that it is a requirement for entitlement to benefits or otherwise of any
significance in deciding the instant Motion. But they do dispute the meaning and implications of the word
“eligibility” (and “eligible”), which Court discusses in more detail below.
The Court also notes that as a procedural matter, the Plan requires that eligibility be “confirmed”
by the Administrative Committee. More specifically, the Plan refers only to “Participant[s]” being
“eligib[le]” to receive Plan benefits, (id. at ¶¶ 3.1, 3.2, 3.3), and to be a “Participant,” a claimant must not
only meet the applicable service requirement, but also be “confirmed as a Participant by the Administrative
Committee in writing.” (Id. at ¶ 2.1(a); see also id. at ¶ 1.12). So a “Participant” is an eligible person who
has been confirmed as a Participant in writing by the Administrative Committee.
Notably, as the Plan is written, the Administrative Committee does not confirm an eligible person’s
eligibility. Rather, the Plan without exception refers to the Administrative Committee confirming the person
“as a Participant.” This is significant because it means that the determination of “Participant” status is
16
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before her benefits were due to be paid. And even if the Court were to review the SVPs’ vote, a
vendor or supplier, as a matter of law, is not a ‘Competing Company’ under the Plan.” (Doc. No.
88-2 at 8).
Plaintiff’s ERISA claim arises under 29 U.S.C. § 1132(a)(1)(B), which provides that an
ERISA plan participant or beneficiary may sue “to recover benefits due to him under the terms of
his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits
under the terms of the plan.” Here, Plaintiff moves for judgment on the pleadings and seeks to
recover benefits allegedly due to her under the terms of the Plan. The Plan makes clear that a
claimant is entitled to receive benefits if she is eligible to receive,17 and is not disqualified from
receiving, benefits. Besides two fleeting and evidently immaterial references to “vesting”
(discussed below in a footnote), the Plan refers to no other considerations whatsoever in
determining whether a claimant is entitled to benefits; the issues are eligibility and disqualification,
and only eligibility and disqualification.
confusingly circular; a person cannot be a Participant unless and until he or she is “confirmed” as such, but
he or she simply does not meet the definition of a “Participant” (and thus cannot be “confirmed” as such)
unless and until they are “confirmed” as a “Participant” (which should be impossible because he or she is
by definition not yet a Participant). As it is actually written, the Plan in this regard is non-sensical—which
would not have been the case if it had provided that the Administrative Committee was to confirm the
eligibility of a would-be Participant, rather than to confirm the status of a mere would-be Participant as a
Participant.
In any event, suffice it to say that just as Defendants do not dispute that Plaintiff met the only
substantive requirement to be eligible (i.e., the service requirement), they do not assert that the procedural
requirement of “confirmation” has not been satisfied; indeed, they do not mention the requirement of
confirmation at all. Thus, the notion of “confirmation” plays no role in the Court’s analysis herein.
The Court’s phrasing here consciously equates “eligibility” with presumptive “entitlement.” The Court
here is intentionally stating that if someone is “eligible” for benefits within the meaning of the Plan, they
are presumptively entitled to receive benefits—entitled, that is, unless disqualified from receiving the
benefits to which they are otherwise entitled. As discussed below, Defendants dispute the equation of
eligibility and (presumptive) entitlement, but the Court finds that the Plan plainly does equate eligibility
with presumptive entitlement.
17
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For Plaintiff to prevail on her Motion, therefore, the Court must determine that—based only
on the pleadings, as they are properly considered as discussed above, and any other material
properly not excluded by the Court as described above—Plaintiff is (a) eligible for benefits; and
(b) not disqualified from receiving benefits.
A. Eligibility
The initial question is whether the facts accepted as true for purposes of the Motion
(namely, the undenied facts alleged in the Amended Complaint and apparent from the
attachments18 thereto, and all the material allegations of fact in the Answer thereto) show that
Plaintiff meets the Plan’s eligibility requirements. As explained below, the answer to that question
is yes. Moreover, contrary to Defendant’s view, “eligibility” to receive benefits means entitlement
to receive benefits, subject to any Plan-specified grounds for disqualification. Thus, Plaintiff is
entitled to receive benefits, absent any circumstances justifying disqualification for benefits under
the Plan.
Under the plain language of the Plan, there are two substantive eligibility requirements: 1)
that the claimant be a “member of Senior Management of the Company,” and 2) that the claimant
have completed at least five years of service to the Company (the “Participation Service”
requirement).19 (Doc. No. 41-1 at ¶¶ 2.1(a), 3.1, 3.2; id. at 22). The parties agree that Plaintiff was
a member of Senior Management and that she had completed more than five years of service to
Nissan at the conclusion of her employment with Nissan. (Doc. No. 45 at ¶ 36 (“Defendants admit
18
The Court notes that the authenticity of none of the attachments to the Amended Complaint is in dispute.
19
As explained in a footnote herein, there is also a procedural requirement for eligibility, i.e.,
“confirm[ation] as a Participant by the Administrative Committee in writing,” but that procedural
requirement is immaterial for purposes of the Motion. (Doc. No. 41-1 at ¶ 2.1(a)).
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 13 of 35 PageID #: 1846
that Plaintiff was a member of Senior Management of Nissan for over five years, making her
eligible to participate in the Plan[.]”)).
There is no dispute, then, that by virtue of meeting these requirements (and timely filing a
claim for benefits), Plaintiff was “eligible” for something under the Plan. When it does speak to
what that something is, the Plan describes it in various ways; it refers to “eligib[ility] to participate
in this Plan,” (Doc. No. 41-1 at ¶ 1.8), “eligib[ility] to become a Participant in the Plan,” (id. at ¶
2.1(a), (b)),20 “eligib[ility] to receive [benefits],” (id. at ¶¶ 3.1, 3.2, 3.3),21 and “eligibility to
participate . . . in accordance with the Plan[.]”, (id. at ¶ 7.5(a)). Ultimately, the language of the
Plan suggests two different kinds of “eligibilities”: (i) eligibility to be a Participant/participate in
the Plan; and (ii) eligibility to receive benefits. It appears that these two kinds of “eligibilities” are
really the same thing (i.e., if someone is eligible to participate in the Plan, then they are eligible to
receive benefits, and vice versa).22 Indeed, the Court does not perceive where the Plan
contemplates any kind of “participation” other than “participation” via the reception of benefits—
i.e., to be eligible to “participate in the Plan” is to be eligible to participate in the reception of
For example, the Plan here states, “[a] member of Senior Management of the Company (as defined in
Exhibit I) is eligible to become a Participant in the Plan; provided that such employee is confirmed as a
Participant by the Administrative Committee in writing.” (Doc. No. 41-1 at ¶ 2.1(a)).
20
For example, the Plan here states, “[e]ach Participant, after meeting the Participation Service requirement
set forth below, is eligible to receive a Supplemental Plan Benefit under the Plan upon the Participant's
Retirement or other Separation from Service.” (Id. at ¶ 3.1).
21
Regarding the first kind of eligibility suggested by the Plan, one’s eligibility to be a Participant under the
Plan, the Plan states that the Administrative Committee’s role is to simply “confirm” that the individual has
met the condition set forth in Exhibit I (i.e., is a member of Senior Management). Here, it is undisputed that
Plaintiff met this condition set forth in Exhibit I; thus, Plaintiff was eligible to be a Participant in the Plan
(and any contrary decision made by Defendants would have been an irrational one). This conclusion appears
to be uncontroversial; the Court takes Defendants’ argument to be directed not at this issue of whether
Plaintiff was eligible to be a Participant in the Plan, but instead whether she was eligible to receive benefits.
22
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 14 of 35 PageID #: 1847
benefits under the Plan. But given the crux of the dispute in this case,23 the Court will speak in
terms of the latter—eligibility for benefits—and will focus its analysis on the question of what it
means to be “eligible” for benefits under the Plan.
The Parties disagree about what it means for a claimant to be “eligible” for benefits.
According to Plaintiff, it means that she was entitled to receive benefits on April 1, 2019 (the first
day of the month falling six months after her last day of work on September 21, 2018). (Doc. No.
88-2 at 10). According to Defendants, it does not mean that she was automatically entitled to
receive benefits. (Doc. No. 97 at 12 (“[T]he fact that Ms. Vest was ‘eligible’ to participate in the
SERP II does not automatically ‘entitle’ her to SERP II benefits. The SERP II unambiguously
states that a participant is ‘eligible’ to participate in the SERP II if she is ‘a member of Senior
Management of the Company’ and has attained five years of service. (Plan Document at 9, 12, 22;
Sections 2.1(a), 3.1, 3.2, Exhibit I.) The Plan does not say, as Ms. Vest repeatedly and erroneously
suggests, that eligible means entitled. (See Plan Document.)”)).
The Court rejects Defendants’ interpretation of the word “eligible” as it applies to a
claimant’s “eligibility” to receive benefits. In the Court’s view, the only rational interpretation of
the Plan is that an individual who meets the Plan’s eligibility requirements receives Plan benefits
(subject to a timely SVP vote).24 In particular, the absence of any additional procedures or criteria
for receiving benefits under the Plan demonstrates that the only reasonable interpretation of the
word “eligible,” as it is used in the Plan to describe “eligib[ility]” to receive benefits, is that the
23
Ultimately, and in practical terms, this case is about whether Plaintiff was wrongfully denied benefits,
not whether she was wrongfully not deemed “eligible.”
To be clear, under the Plan, “eligible” persons can still be denied benefits if they are subject to forfeiture
of those benefits pursuant to Section 2.3(b) (or, for that matter, Section 7.1 of the Plan, which prescribes
additional grounds for forfeiture).
24
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 15 of 35 PageID #: 1848
individual is presumptively (i.e., barring some disqualifying factor such as, for example, violation
of the non-competition provision) entitled to receive benefits. Defendants state that the25 definition
of “eligible,” according to Merriam-Webster, is “qualified to participate or be chosen.” (Doc. No.
97 at 13 n.6). But after applying this definition, the question still remains: what does it mean to be
“qualified,” and if someone is “qualified,” does that make them “entitled” to benefits? It would
make little sense if a claimant “eligible” for benefits were deemed merely “qualified to . . . be
chosen” for benefits, when the Plan provides no criteria or guidance as to how or why such eligible
claimant would be “chosen” to receive benefits. That is to say, the Plan in no way contemplates
the selection, from the set of all claimants eligible to receive benefits, of a subset of (very fortunate)
eligible claimants who actually will receive benefits. Additionally, just as Plaintiff suggests,
“eligible” is a synonym for “entitled,” making it reasonable to use the words interchangeably.
Entitled,
Roget's
21st
Century
Thesaurus,
Third
Edition,
https://www.thesaurus.com/browse/entitled.
Here, because Plaintiff met the eligibility requirements and timely filed a claim as outlined
in the Claims Procedure, she was entitled to receive benefits as a lump sum in April 2019. (Doc.
No. 41-1 at ¶ 3.4 (“Such lump sum shall be paid on via executive payroll during the month
following the six month anniversary of the last day worked.”), Doc. No. 41 at ¶ 16 (“[Plaintiff]
served in that role until her resignation, effective September 21, 2018.”)).
Defendants’ Answer supports this position. In the Answer, Defendants state, “Defendants
admit that Plaintiff was a member of Senior Management of Nissan for over five years, making
Defendants also present Merriam-Webster’s second definition of “eligible”—“worthy of being chosen.”
(Doc. No. 97 at 13 n.6). But Merriam-Webster makes clear that this second definition is not applicable here,
when it uses the phrase “an eligible young bachelor” to illustrate the applicability of this definition.
https://www.merriam-webster.com/dictionary/eligible (last visited August 11, 2022).
25
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 16 of 35 PageID #: 1849
her eligible to participate in the Plan, but she is no longer entitled to Plan benefits. Plaintiff
forfeited those benefits when she resigned from NNA and accepted employment with a company
that competes with it.” (Doc. No. 45 at ¶ 36). Thus, Defendants did not merely admit that Plaintiff
is eligible for benefits, but also plainly implied26—in stark and unexplained contrast to their current
position—that the effect of her eligibility was that it made her entitled to receive benefits (subject
to the possible forfeiture of such benefits, a topic that the Court discusses below).
To be clear, as discussed elsewhere herein, the Court recognizes that to the extent that the
Administrative Committee is vested with the authority to interpret the Plan’s provisions regarding
eligibility, the Court would need to defer to the Administrative Committee’s interpretation as to
eligibility. But the Court does not perceive that Defendants made any adverse findings (or indeed
any findings at all) regarding Plaintiff’s eligibility for benefits; therefore, there is no “review”
(under either a de novo or arbitrary and capricious standard) for the Court to conduct here on the
issue of Plaintiff’s eligibility. Though the Court views the Advisory Position as a “denial,” it is not
a denial based on a lack of eligibility; the Court does not see where the Administrative Committee
(or anyone else) ever has interpreted the Plan to deem Plaintiff not eligible. Rather, the basis for
the denial via the Advisory Position was the alleged disqualification under Section 2.3(b) of the
Plan (“the non-competition provision”). Therefore, the Court finds, without needing to conduct
any “review” of any determination by Defendants (because there was no determination by
Defendants on the issue of eligibility), that as a matter of law, Plaintiff is eligible for (entitled to)
benefits unless any grounds for disqualification apply.
By contending that Plaintiff was “eligible” and yet “no longer entitled” to benefits (due to her acceptance
of employment that supposedly effected forfeiture), Defendants unmistakably imply that she had been
entitled to benefits by virtue of being eligible, prior to her acceptance of such employment.
26
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 17 of 35 PageID #: 1850
B. Disqualification (forfeiture)27
Defendants argue that Plaintiff forfeited her benefits under the non-competition provision
when she accepted employment with Bridgestone. Defendants, on two occasions and via two
separate decision-making bodies, issued a denial of Plaintiff’s benefits on the basis that she
forfeited her benefits due to her (alleged) violation of the non-competition provision; first, the
Administrative Committee’s denial28 set forth in the Advisory Position (the “initial denial”), and
second, the SVPs’ vote “to sustain the denial.”29 (Doc. No. 45 at ¶ 8). The Court will review each
of these denials in turn, applying the relevant standard of review.
The Court uses the terms “forfeiture” and “disqualification” interchangeably to refer to a denial of
benefits based on the grounds set forth in Section 2.3(b), whereby “if the Participant is found by a majority
vote of the Senior Vice Presidents of the Company to have violated in any way the restrictions and
requirements [set forth in Section 2.3(b)] . . . then the Company . . . will have no further obligation to make
any payment of any benefit deemed accrued hereunder to the Participant[.]” In other words, if the claimant
is found to have violated Section 2.3(b), then the otherwise eligible claimant is disqualified from receiving
benefits, or the claimant has forfeited his or her benefits.
27
The Court previously held that the April 5, 2019 Advisory Position constitutes an “initial determination”
(i.e., a decision of denial of benefits). (Doc. No. 34 at 14–15 n.9 (“the Court finds that a decision of denial
was reached with the initial advisory position, pursuant to Claims Procedure Subsection 7.12(d).”)). The
Court adheres to that decision for purposes of the instant Motion, not least because it is consistent with the
position that the non-movants (Defendants) have taken for purposes of the instant Motion. (Doc. No. 97 at
9). The Court notes, though, that this was an improper denial because, among other things (discussed further
below), it was made by the wrong person (because only the SVPs are entrusted with the ability to enforce
Section 2.3(b) of the Plan).
28
Setting aside the issue of “eligibility,” the “initial denial” violates the Claims Procedure set forth in the
Plan. The Advisory Position’s denial is based primarily on its position that Plaintiff violated Section 2.3(b).
As the Court explained above and in its prior memorandum opinion denying the motion to dismiss, Section
2.3(b) of the Plan (the provision pursuant to which Defendants claim the Administrative Committee had
authority to make the initial denial) is not part of the Claims Procedure and can be invoked only by the
SVPs. And even if the Administrative Committee did have the authority to make the initial denial, it also
failed to follow the procedures outlined in the Plan because the SVPs had not (at the time of the initial
denial) taken a vote on the issue, as required by Section 2.3(b). (Doc. No. 41-1 (requiring “a majority vote
of the Senior Vice Presidents of the Company”)). Therefore, the initial denial violated the plain terms of
the Plan. Had the SVPs’ failure to take a vote prior to the initial denial been the only issue here (a purely
“procedural” violation), the Court would have simply remanded this case to the Plan’s administrator (as
explained in more detail in the “Benefits” section below). Shelby Cnty. Health Care Corp. v. Majestic Star
Casino, 581 F.3d 355, 373 (6th Cir. 2009) (“[A] procedural violation does not warrant the substantive
remedy of awarding benefits[.]”). But because the Court also finds herein that the denial of benefits itself
29
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 18 of 35 PageID #: 1851
a. Standard of review30
The Supreme Court has held that “a denial of benefits challenged under § 1132(a)(1)(B) is
to be reviewed under a de novo standard unless the benefit plan gives the administrator or
fiduciary31 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). Thus, while the default
standard for reviewing a denial of benefits under ERISA is de novo, when the plan “gives the plan
administrator discretionary authority to determine eligibility for benefits or to construe the terms
of the plan,” then the deferential “arbitrary and capricious” standard applies. Wilkins v. Baptist
Healthcare Sys., Inc., 150 F.3d 609, 616 n.4 (6th Cir. 1998).
was improper (and not just the procedures by which the claim was denied), the Court will award Plaintiff
benefits.
30
In conjunction with their discussion of the proper standard of review, the parties discuss whether the Plan
is a top hat plan or a garden variety ERISA plan. But neither party offered any reason as to why this
distinction would be material for purposes of ruling on the Motion, and the Court cannot independently
discern any reason. Thus, the Court will not undertake an extensive discussion of this topic. The Court
previously held that the Plan is “likely” a top hat plan. (Doc. No. 34 at 10–11). Defendants argue that it is
a top hat plan and Plaintiff accepts this premise for purposes of the Motion. Thus, for what it is worth, the
Court accepts the (seemingly immaterial) notion that the Plan is indeed a top hat plan.
Under the Plan, the “administrator or fiduciary” is the NNA Retirement and Savings Committee, referred
to in the Plan and by the Court herein as the “Administrative Committee.” (Doc. No. 41-1 at ¶ 1.2). The
Plan states,
31
Administrative Committee means the NNA Retirement and Savings Committee (as
Administrator of Nissan North America's qualified retirement plans) appointed by the
Board of Directors of Nissan North America, Inc., with the powers and duties described in
this Plan and in the Trust Agreements. The NNA Retirement and Savings Committee may
delegate its administrative responsibilities to a Supplemental Executive Retirement Plan
(SERP) subcommittee, all members of which shall be voting members of the NNA
Retirement and Savings Committee.
(Id.). Thus, when the parties refer to the “SERP Administrative Committee” or the “SERP Committee,”
they are really referring to a subcommittee of the Administrative Committee. For ease of reference in this
opinion, and because it appears to the Court to be immaterial for purposes of the Court’s analysis whether
certain actions were taken by the Administrative Committee or a subcommittee thereof, the Court will refer
to the Administrative Committee and any subcommittees of the Administrative Committee simply as the
“Administrative Committee.”
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 19 of 35 PageID #: 1852
Here, the Plan gives the Administrative Committee “sole discretion” to enforce, interpret,
and construe the Plan. (Doc. No. 41-1 at ¶ 7.5). Therefore, a denial of benefits made by the
Administrative Committee is (generally speaking) subject to review under the arbitrary and
capricious standard. However, the denial by the Administrative Committee here (as set forth in the
Advisory Position), was made pursuant to provisions of the Plan—regarding disqualification—
that the Administrative Committee is not vested with the authority to enforce, under the Plan’s
plain terms. The Advisory Position clearly indicates that the Administrative Committee’s denial
was based on the non-competition provision of Section 2.3(b) of the Plan. The Advisory Position
describes the non-competition provision, makes a statement about how the Administrative
Committee “historically” has applied the non-competition provision, and then states that “the
[Administrative] Committee has decided that under the terms of the SERP II, you are not permitted
to work for a vendor that provides products to multiple automotive OEMs and collects SERP II
benefits.” (Doc. 41-2). The Advisory Position concludes by informing Plaintiff that her benefits
“will be forfeited pursuant to Section 2.3(b) of the Plan” unless she provides confirmation that she
is not in violation of the non-competition provision, as interpreted by the Administrative
Committee. (Id.). In the Answer, Defendants confirm that the denial contained in the Advisory
Position was based on a purported violation of the non-competition provision. (Doc. No. 45 at ¶ 8
(“… Plaintiff is not entitled to receive any Plan benefits because she violated her agreement not to
work for a company that competes with NNA. On April 5, 2019[, the date on which the Advisory
Position was issued to Plaintiff], Defendants notified Plaintiff that her request for Plan benefits
had been accordingly denied.”)). Thus, the Court finds that the Administrative Committee issued
its denial (via the Advisory Position) based on the non-competition provision of Section 2.3(b) of
the Plan.
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 20 of 35 PageID #: 1853
Under the Plan, however, only the SVPs are entrusted with the authority (exercisable upon
majority vote) to find a that a claimant is disqualified from receiving benefits under Section 2.3(b).
(Doc. No. 41-1 at ¶ 2.3(b)). Therefore, because the Administrative Committee was not authorized
to make the determination of disqualification under Section 2.3(b) of the Plan, a de novo standard
of review applies to its denial of Plaintiff’s benefits based on such disqualification.32 Sanford v.
Harvard Indus., Inc., 262 F.3d 590, 596 (6th Cir. 2001) (the court reviews de novo decisions
governed by ERISA that are made by an unauthorized body); Parkridge Med. Ctr., Inc. v. CPC
Logistics, Inc. Grp. Ben. Plan, No. 1:12-CV-124, 2013 WL 3976621, at *6 (E.D. Tenn. Aug. 2,
2013) (applying de novo review when an entity other than the entity with sole discretion to interpret
plan documents “communicated with [the claimant] regarding its claim, issued the decision letter,
[and] considered the appeal”); Wintermute v. The Guardian, 524 F. Supp. 2d 954, 960 (S.D. Ohio
2007) (“ClaimSource is an unauthorized body without discretionary authority to terminate benefits
under the plan, [so] its decision to terminate [Plaintiff's] disability benefits receives de novo
review.”).
The SVPs’ vote to deny Plaintiff benefits, however, is subject to the arbitrary and
capricious standard of review because the Plan gives the SVPs the authority to vote to determine
any violation of the non-competition provision in Section 2.3(b) (which, therefore, necessarily
carries with it the discretion to interpret and apply the terms of Section 2.3(b)). Therefore, when
32
Defendants argue that because the Plan generally gives the Administrative Committee discretion to
interpret the Plan, the deferential arbitrary and capricious standard of review should apply to the
Administrative Committee’s denial regardless of the fact that the denial was based on a purported violation
of Section 2.3(b). (Doc. No. 97 at 10-11). Though the Court disagrees with this position, as described herein,
even under an arbitrary and capricious standard of review, Plaintiff would prevail, as the Court goes on to
explain. Thus, Plaintiff’s Motion would be granted even if the arbitrary and capricious standard of review
applied to the Administrative Committee’s decision.
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 21 of 35 PageID #: 1854
reviewing the SVPs’ vote to sustain the denial of Plaintiff’s benefits, the Court will apply the
arbitrary and capricious standard of review.33
b. The initial denial
The Court begins by reviewing the Administrative Committee’s denial of Plaintiff’s
benefits (set forth in the Advisory Position), undertaking the more stringent, less deferential de
novo review. In applying the de novo standard of review in an ERISA action, the court's role is to
33
Plaintiff points out that the Court determined in a related case (involving the same Plan) that de novo
review is appropriate when considering decisions made by the SVPs because the Plan does not give the
SVPs interpretative authority:
Nevertheless, it is relevant that the document Defendants identify as announcing a
“decision” indicates that the SVPs of Nissan—and not the Administrative Committee—
voted to find Plaintiff ineligible to receive benefits. The Plan nowhere equates the SVPs
with the Administrative Committee, and there is no indication that the SVPs are delegated
the Administrative Committee’s discretion under the Plan. In fact, in referring to the “sole
discretion” of the Administrative Committee to determine issues relating to eligibility to
participate in the Plan and to determine the amount and kind of benefits payable to
claimants, the Plan indicates that the SVPs affirmatively lack such discretion. The Court
has previously discussed the confusion regarding the role of the SVPs in the Claims Process
and has indicated that their involvement in the Claims Procedure is not contemplated by
the Plan.
Defendants have failed to carry their burden of showing the Court that they are entitled to
arbitrary and capricious review, because it is apparent that an entity other than the
Administrative Committee [was] exercising (or at least purporting to exercise) the
discretion referenced in the Plan. As a result, the Court finds that it should undertake a de
novo review when construing the Plan document.
Delauter v. Nissan Supplemental Exec. Ret. Plan II, No. 3:20-CV-00609, 2021 WL 2515238, at *10 (M.D.
Tenn. June 18, 2021) (Richardson, J.). Plaintiff’s point is well taken. Here, while the Plan gives the SVPs
authority to conduct a vote on the issue of whether a claimant has violated the non-competition provision
of Section 2.3(b), the Plan does not explicitly give the SVPs authority to interpret or construe the Plan. See
Daul v. PPM Energy, Inc., No. CV 08-524-AC, 2009 WL 2496333, at *2 (D. Or. Aug. 14, 2009) (“[P]lan
terms which merely identify the administrator's tasks but bestow no power to interpret the plan are
insufficient to confer discretionary authority on the administrator.”) (citing Ingram v. Martin Marietta Long
Term Disability Income Plan, 244 F.3d 1109, 1113 (9th Cir. 2001)). Defendants should have been more
explicit in granting the SVPs discretion to interpret the Plan via the voting procedure set forth in Section
2.3(b). However, the Court finds the most reasonable interpretation of the Plan is that, by entrusting the
SVPs with the ability to vote under Section 2.3(b), the Plan necessarily granted the SVPs discretion to
“interpret” relevant provisions of Section 2.3(b)—i.e., make a decision as to what those provisions mean,
in the course of determining whether, given their proper meaning, they dictate disqualification of a claimant.
That being said, for the reasons set forth below, Plaintiff prevails whether the Court applies the de novo
standard of review or the arbitrary and capricious standard of review.
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 22 of 35 PageID #: 1855
determine whether the plan administrator made the correct decision in denying benefits. Hoover
v. Provident Life & Acc. Ins. Co., 290 F.3d 801, 808–09 (6th Cir. 2002). On de novo review, “[t]he
administrator's decision is accorded no deference or presumption of correctness. The review is
limited to the record before the administrator[,] and the court must determine whether the
administrator properly interpreted the plan and whether the insured was entitled to benefits under
the plan.” Id. at 809 (citation omitted), The “de novo standard of review applies to the factual
determinations as well as to the legal conclusions of the plan administrator.” Wilkins, 150 F.3d at
613 (citing Rowan v. Unum Life Ins. Co., 119 F.3d 433, 435 (6th Cir. 1997)). Additionally,
“[u]nder general contract principles, where the Court is conducting a de novo review, ‘any
ambiguities in the language of the plan [must] be construed strictly against the drafter of the plan.’”
Heimer v. Companion Life Ins. Co., No. 1:15-CV-338, 2016 WL 10932755, at *4 (W.D. Mich.
Aug. 12, 2016), aff'd, 879 F.3d 172 (6th Cir. 2018) (citing Regents of Univ. of Mich. v. Emps. of
Agency Rent–A–Car Hosp. Ass'n, 122 F.3d 336, 340 (6th Cir. 1997)). The Court therefore can (and
will) construe any ambiguities in the Plan against the drafter (Defendants) when considering issues
implicated by the determination made by the Administrative Committee related to Section 2.3(b).
Under Section 2.3(b), a claimant’s benefits are forfeited if she “accepts any position as an
employee of or a consultant to any Competing Company.” (Doc. No. 41-1 at ¶ 2.3(b)). A
“Competing Company” is defined in the Plan as “any business or organization . . . with which the
Company competes, including but not limited to a business that manufactures, assembles, imports,
distributes, and/or sells passenger automobiles and/or light trucks and/or light commercial
vehicles, and/or a business which is engaged in automotive finance and related services, except for
such a company or organization that is owned, directly or indirectly, by Nissan Motor Co., Ltd.,
or Renault. . . . .” (Id.).
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 23 of 35 PageID #: 1856
As noted above, the Court views the Administrative Committee to have determined (as
stated in the Advisory Position) that Plaintiff was disqualified from receiving benefits because she
had violated Section 2.3(b). This determination is incorrect because Bridgestone simply is not a
“Competing Company,” as defined in the Plan, as is plainly required for disqualification under
section 2.3(b).
“Competing Company” is defined primarily as “a[] business or organization . . . with
which the Company competes.” (Doc. No. 41-1 at ¶ 2.3(b)). It would require an unreasonable
construction of the Plan’s term “competes” to say that a tire manufacturer “competes” with an
automobile manufacturer like Nissan; Defendants admit that Bridgestone sells tires, not
automobiles, and nothing in the Plan indicates that a supplier of automotive parts would be
considered the type of company that competes with Nissan.
Defendants emphasize the phrase in Section 2.3(b) “included but not limited to,” and argue
that, “[a]dmittedly, the [Plan] document does not spell out every company that may be a
‘Competing Company,’ but it’s not required to, and doing so would be impractical.” (Doc. No. 97
at 22). The Court does not disagree with Defendants here, but ultimately that makes no difference.
The Court’s conclusion that the Administrative Committee’s denial was necessarily the result of
an untenable construction of the Plan does not rest on a restrictive view of the phrase “including
but not limited to”; instead, it is based on the Plan’s primary definition of “Competing Company”
as one “with which the Company competes.” As Plaintiff aptly points out:
The catch-all “including but not limited to” merely illustrates (and does not expand)
the category of “any business or organization with which the Company competes.”
And there is no allegation that Nissan competes with Bridgestone . . . .
(Doc. No. 102 at 6). To the contrary, as Plaintiff further notes:
the Administrative Committee determined that Bridgestone “manufactures tires for
OEMs and the aftersales markets, and supplies tires for new vehicles to Nissan as
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 24 of 35 PageID #: 1857
well as other OEMs.” It defies logic that Nissan would purchase tires from a
company with which it competes.
(Id.) (citation omitted). Had Defendants wished to include a company such as Bridgestone as a
Competing Company, they could have done so by writing the definition in the Plan in such a way
that clearly includes manufacturers of products for other automobile manufacturers. See Jones,
385 F.3d at 661 (6th Cir. 2004) (“[The insurer] could have expressly included such a
requirement.”).
Despite Defendants’ post-facto insistence that Bridgestone was a Competing Company for
purposes of Section 2.3(b), that was not actually the basis for the Administrative Committee’s
decision according to the Advisory Position. True, the Advisory Position did quote the definition
of “Competing Company” and note that working for one was grounds for disqualification under
Section 2.3(b). (Doc. No. 41-2). But it did not then assert that Bridgestone was a “Competing
Company.” Instead, the Advisory Position asserted a different reason for disqualifying Plaintiff
from receiving benefits under Section 2.3(b): that Plaintiff violated some purported requirement
(for avoiding disqualification) that claimant’s post-Nissan employment not be with “vendors that
provide products or services to multiple automotive OEMs, unless their work related
exclusively to Nissan/Infiniti or Nissan/Infiniti dealers.” (Id.) (emphases added). More specifically,
after stating the purported requirement, the Advisory Position tacitly assumed (apparently with
justification) that Bridgestone was a vendor “that provide[s] products or services to multiple
automotive OEMs,” then asserted (albeit not in the clearest of terms) that apparently Plaintiff’s
work at Bridgestone was not exclusively with or for the benefit of Nissan/Infiniti; on this basis,
the Advisory Position effectively denied her claim for benefits (subject to “appeal”). (Id.). But this
purported requirement is not found in the Plan, which nowhere prescribes the general rule (set
forth in bold above) that provides (subject to the exception noted in italics above) for
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 25 of 35 PageID #: 1858
disqualification if the claimant provides products or services to multiple automobile
manufacturers. And the Administrative Committee cannot simply conjure up a ground for
forfeiture not included in the Plan, especially considering that the Plan does not even give the
Administrative Committee authority to determine forfeiture under Section 2.3(b). Had Defendants
wanted to include violation of the above-stated purported requirement as grounds for forfeiture,
Defendants could and should have included such a requirement. They did not.
In short, the Court concludes that a tire manufacturer such as Bridgestone is simply not a
“Competing Company” as defined by the Plan, as is actually required to disqualify Plaintiff under
the non-competition provision of Section 2.3(b). The Court further finds that the purported grounds
for disqualification relied on by the Administrative Committee simply do not exist; they are not
cognizable grounds for forfeiture under the Plan. Thus, the Court finds, on de novo review, that
the Administrative Committee’s determination that Plaintiff had forfeited her benefits based on
Section 2.3(b) was incorrect, and thus Plaintiff is not disqualified from receiving her benefits.34
c. The SVPs’ vote
The determination that Plaintiff forfeited her benefits when she began working for
Bridgestone in violation of Section 2.3(b) is not only incorrect under a de novo standard of review,
Throughout their brief, Defendants also contend that “Ms. Vest admits that there were “legitimate
business reasons” to find that Bridgestone is a “Competing Company.” (Doc. No. 97 at 15 n.10). But
Defendants cite no authority, and provide no explanation as to why it matters that there (supposedly) were
legitimate business reasons” for this finding. Further, Defendants misquote Plaintiff, who actually states
only that “Nissan’s Director of Legal and Assistant General Counsel notes legitimate business reasons for
Nissan not wanting its executives to work for a vendor or supplier. Vest does not contest these reasons.”
(Doc. No. 88-2 at 15 n.10). As Plaintiff puts it, “whether the company has a legitimate business interest in
preventing its executives to work for a supplier or vendor is not relevant to the substantive question in
interpreting the Plan.”).” (Doc. No. 102 at 5-6). It is one thing to say that the company has legitimate reasons
to prefer that its departing executives not work for a vendor or supplier of the company. It is quite another
to say that the company had legitimate business reasons for deeming a particular term in the Plan applicable
under particular circumstances. The Court thus does not herein consider the existence or non-existence of
the alleged “legitimate business reasons.”
34
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 26 of 35 PageID #: 1859
but is also arbitrary and capricious. “An ERISA benefit plan administrator's decisions on
eligibility35 for benefits are not arbitrary and capricious if they are rational in light of the plan's
provisions.” Yeager v. Reliance Standard Life Ins. Co., 88 F.3d 376, 381 (6th Cir. 1996) (internal
quotation marks and citations omitted). The Court realizes that the arbitrary and capricious
standard of review is a relatively deferential standard, since mere rationality (vis-à-vis plan
provisions) is not a high bar for a decision to clear. And yet the SVPs’ decision nevertheless fails
to clear it.
Unlike the Administrative Committee, the SVPs are provided by the Plan the authority to
vote on a claimant’s purported violation of the non-competition provision of Section 2.3(b). Thus,
as described above, the Court views the Plan as giving the SVPs limited discretion to interpret
Section 2.3(b)—as opposed to other sections—of the Plan. But this discretion does not render the
SVPs’ vote to sustain the Administrative Committee’s denial of benefits under Section 2.3(b)36
rational in light of the Plan’s plain terms. Rather, consistent with the discussion above regarding
the Administrative Committee’s vote, the SVPs’ vote to sustain the forfeiture of Plaintiff’s benefits
was irrational. As explained, Bridgestone (a tire manufacturer and supplier) does not meet the
35
This standard applies not only to decisions on eligibility for benefits, but also to decisions regarding
disqualification from receiving benefits under an ERISA plan.
36
Perhaps stating the obvious, the Court makes clear that it accepts as true, and the parties do not appear to
dispute, that the SVPs’ vote was based on Section 2.3(b). The Court need not rely on any filings outside of
the pleadings to make this determination because the Answer states that the SVPs voted to “sustain the
denial of Plaintiff’s request for Plan benefits”—a denial that was made by the Administrative Committee
“because she violated her agreement not to work for a company that competes with NNA.” (Doc. No. 45 at
¶ 8).
The Court also mentions here that Section 2.3(b) of the Plan does not contemplate the SVPs voting
to “sustain” (or, conversely, overrule) a determination previously made by the Administrative Committee
regarding the non-competition provision. The Court views this to be a violation of the procedures set forth
in the Plan, and notes that this procedural violation has possible substantive implications. That is, it appears
by virtue of Defendants using the term “sustain” that the SVPs did not entirely independently vote to deny
Plaintiff benefits, but instead were first presented with the Administrative Committee’s determination on
the issue.
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 27 of 35 PageID #: 1860
definition of Competing Company set forth in the Plan, as would be required for Plaintiff’s
employment with Bridgestone to constitute grounds for forfeiture under the non-competition
provision of Section 2.3(b). In order to consider Bridgestone a “Competing Company,” the SVPs
would have had to interpret the word “competing” in an manner that is irrational because goes
against its plain meaning.
In any event, there is nothing to indicate that the SVPs’ vote to disqualify Plaintiff was
actually based on Bridgestone fitting within the definition of “Competing Company.” And to the
extent that the vote to disqualify Plaintiff under Section 2.3(b) was based on (alleged) grounds for
disqualification—other (alleged) barriers to Plaintiff retaining her presumptive eligibility to
receive benefits—that would be plainly outside the SVPs’ authority. See Jones v. Metro. Life Ins.
Co., 385 F.3d 654, 661 (6th Cir. 2004) (“Discretion to interpret a plan, however, does not include
the authority to add eligibility requirements to the plan.”). It thus would have been, in a word,
irrational. So to the extent that the SVPs’ denial was based on the same illusory grounds for
forfeiture that the Administrative Committee invented—as Defendants’ Answer suggests it may
have been (Doc. No. 45 at ¶ 8)—the decision would be irrational. In short, to be something other
than arbitrary and capricious, the SVPs’ vote would have had to have been based on a rational
view that Bridgestone was a Competing Company. And the current record reveals that even if the
SVPs had concluded that Bridgestone was a Competing Company—which seems unlikely, given
the rationale of the decision they were reviewing—such a conclusion would have been entirely
without basis and thus irrational.
Therefore, the Court finds that the SVPs acted arbitrarily and capriciously when voting to
sustain the denial of Plaintiff’s benefits based on Section 2.3(b) of the Plan.
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 28 of 35 PageID #: 1861
d. Conclusion
As described herein, the Court finds based on the uncontroverted facts of the Amended
Complaint (and the attachments thereto) and Defendants’ Answer alone, that (a) Plaintiff is
“eligible,” meaning presumptively entitled to benefits, under the Plan, and (b) Plaintiff is not
disqualified from receiving those benefits to which she is entitled absent disqualification. The
Court thus finds that Plaintiff has met her burden of showing that she is entitled to judgment as a
matter of law, based solely on what the Court can properly consider under Rule 12(c), and her
Motion will be granted.
C. Remedy
The Court has discretion to determine the appropriate remedy for Defendants’ erroneous
denial of benefits. Shelby Cnty. Health Care Corp., 581 F.3d at 372 (“An appellate court reviews
a district court's choice of remedy in an ERISA action for abuse of discretion.”). As the Sixth
Circuit in Shelby Cnty. Health Care Corp. explained,
Where a district court determines that the plan administrator erroneously
denied benefits, a district court “may either award benefits to the claimant or
remand to the plan administrator.” Elliott v. Metro. Life Ins. Co., 473 F.3d 613, 621
(6th Cir. 2006); DeGrado v. Jefferson Pilot Fin. Ins. Co., 451 F.3d 1161, 1175
(10th Cir. 2006) (stating that a district court has two options after determining that
a denial of benefits was improper: “it can either remand the case to the administrator
for a renewed evaluation of the claimant's case, or it can award a retroactive
reinstatement of benefits”) (internal quotation marks omitted); see also 29 U.S.C.
§ 1132(a)(1)(B) (establishing the right of plan participants who bring suit pursuant
to ERISA “to recover benefits due to him under the terms of his plan”).
[. . .]
In contrast, where “there [was] no evidence in the record to support a
termination or denial of benefits,” an award of benefits is appropriate without
remand to the plan administrator. E.g., DeGrado, 451 F.3d at 1176; see Helfman v.
GE Group Life Assurance Co., 573 F.3d 383, 396 (6th Cir. 2009) (ordering remand
to the plan administrator after determining that the record did not “clearly
establish[]” that the claimant was entitled to benefits).
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 29 of 35 PageID #: 1862
581 F.3d at 373-74.37
As explained by one district court, a retroactive award of benefits is preferred in some
circumstances:
In an ERISA benefits case, a court has discretion in fashioning a remedy. Upon
finding that a plan administrator has not reached a correct decision under a de novo
standard, a court may either remand the case to the administrator for a re-evaluation
of the claim or retroactively award benefits. In crafting a remedy, however, the
Court must remain cognizant of the fact that ERISA promotes the interests of
employees and other plan beneficiaries by protecting employees' contractually
defined benefits. “Allowing a plan administrator another opportunity to reenforce
its conclusion after many months and several layers of administrative proceedings
during which it had ample time to conduct the necessary evaluation would
undermine these underlying policies of ERISA.” Thus, remand is unnecessary
where the claimant would have received benefits had the correct review been
performed.
Levine v. Life Ins. Co. of N. Am., 182 F. Supp. 3d 250, 266 (E.D. Pa. 2016) (footnotes and citations
omitted). See also Bard v. Bos. Shipping Ass'n, 471 F.3d 229, 246 (1st Cir. 2006) (an award of
benefits, rather than remand, is appropriate where the evidence “compels the conclusion that [the
plaintiff] is entitled to benefits.”).
Further, some courts have held that remand is always an inappropriate remedy where the
court has engaged in a de novo review and thus has made its own independent determination on
the issue of a plaintiff’s entitlement to benefits:
Where the de novo standard applies, the court is required to make “an independent
determination of the issue.” See United States v. First City Nat'l Bank, 386 U.S.
361, 87 S. Ct. 1088, 18 L.Ed.2d 151 (1967) (holding that “review de novo” means
“that the court should make an independent determination of the issues”). Remand
cannot be an appropriate remedy where the court has already made its own
independent determination.
“When applying a de novo standard in the ERISA context, the role of the
court reviewing a denial of benefits is to determine whether the administrator made
Here, the relevant “plan administrator” appears to be the Administrative Committee. (See Doc. No. 41-1
at ¶ 1.2 (“Administrative Committee means the NNA Retirement and Savings Committee (as Administrator
of Nissan North America's qualified retirement plans) appointed by the Board of Directors of Nissan North
America, Inc[.]”)).
37
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 30 of 35 PageID #: 1863
a correct decision.” Niles v. Am. Airlines, Inc., 269 F. App'x 827, 832 (10th Cir.
2008) (unpublished) (citation omitted). For ERISA benefits claims, de
novo “standard is not whether ‘substantial evidence’ or ‘some evidence’ supported
the administrator's decision.” Id. at 833. Rather, “it is whether the plaintiff's claim
for benefits is supported by a preponderance of the evidence based on the district
court's independent review.” Id.; see also Ray v. UNUM Life Ins. Co. of Am., 244
F. App'x 772, 782 (9th Cir. 2007) (unpublished) (approving of district court's
application of preponderance of evidence standard).
David P. v. United Healthcare Ins. Co., 564 F. Supp. 3d 1100, 1123 (D. Utah 2021).
As described above, the Court finds herein that 1) Plaintiff was entitled to receive benefits,
and 2) Plaintiff was not disqualified from receiving benefits and the Administrative Committee’s
determination otherwise was incorrect under a de novo standard (and the SVPs’ vote otherwise
was arbitrary and capricious). In other words, the Court has reached an independent determination
that Plaintiff is entitled to benefits, and no evidence here supports a denial or forfeiture of
Plaintiff’s benefits. Thus, remand is unwarranted and the Court views the most appropriate relief
to be an award of benefits to Plaintiff without remand to the Administrative Committee.
Plaintiff also requests an award of prejudgment interest (measured “from the date that
[Plaintiff] was entitled to have her benefits paid to the date of the Court’s judgment”) and
postjudgment interest (measured “from the date of the Court’s judgment to the date that the
benefits are paid.”). (Doc. No. 41 at 11). “As a matter of equity, the district court has the discretion
to award prejudgment interest in ERISA cases.” Pinckney v. Blue Cross Blue Shield of Tennessee,
Inc., No. 3:05-00962, 2007 WL 108886, at *9 (M.D. Tenn. Jan. 9, 2007) (citing Ford v. Uniroyal
Pension Plan, 154 F.3d 613, 616 (6th Cir. 1998)). The Court finds that equity requires awarding
Plaintiff prejudgment interest to give Plaintiff the full value of her lost benefits. Awarding
prejudgment interest in this matter would incentivize Defendants to conduct themselves in a
manner that accords with the procedures set forth in the Plan for evaluating one’s eligibility for
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 31 of 35 PageID #: 1864
benefits. See Warden v. Metro. Life Ins. Co., 574 F. Supp. 2d 838, 850 (M.D. Tenn. 2008) (“Not
to award prejudgment interests, would render breaches of the Plan profitable.”).
Additionally, an award of postjudgment interest is required. As the Sixth Circuit has
explained,
Under 28 U.S.C. § 1961, district courts are required to award postjudgment interest.
The statute provides that “[s]uch interest shall be calculated from the date of the
entry of the judgment,” and “shall be computed daily to the date of payment.” 28
U.S.C. § 1961(a), (b). The statute “mandates the imposition of post-judgment
interest, thus removing the award of such interest from the discretion of the District
Court.” Bricklayers' Pension Trust Fund v. Taiariol, 671 F.2d 988, 989 (6th Cir.
1982). The federal postjudgment interest statute allows interest on “all money
judgments,” including those in ERISA cases. Hoover v. Provident Life & Accident
Ins.
Co., 290
F.3d
801,
810
(6th
Cir.
2002).
Caffey v. Unum Life Ins. Co., 302 F.3d 576, 586 (6th Cir. 2002). Thus, Plaintiff will be awarded
postjudgment interest.
Finally, Plaintiff will be awarded reasonable attorneys’ fees. The Sixth Circuit has set forth
six factors for a district court to consider upon request for an award of attorneys’ fees in an ERISA
matter,
Under 29 U.S.C. § 1132(g)(1) a “court in its discretion may allow a reasonable
attorney's fee and costs of action to either party.” A district court must consider
the following factors in deciding whether to award attorney fees, (1) the degree of
the opposing party's culpability or bad faith; (2) the opposing party's ability to
satisfy an award of attorney's fees; (3) the deterrent effect of an award on other
persons under similar circumstances; (4) whether the party requesting fees sought
to confer a common benefit on all participants and beneficiaries of an ERISA plan
or resolve significant legal questions regarding ERISA; and (5) the relative merits
of the parties' positions.
Shelby County Health Care Corp. v. Southern Council of Indus. Workers Health and Welfare
Trust, 203 F.3d 926, 936 (6th Cir. 2000). The Court’s observations above regarding prejudgment
interest also support an award of attorneys’ fees. Defendants’ failure to comply with the procedures
set forth in the Plan, Defendants’ incorrect denial of benefits, and the clear merit of Plaintiff’s
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 32 of 35 PageID #: 1865
position (and countervailing lack of merit in Defendants’ position) discussed herein also weigh in
favor of awarding attorneys’ fees. This award will discourage future erroneous decisions by
Defendants related to the Plan, and will benefit other Plan participants via the ruling attained by
Plaintiff. See Powell v. Premier Mfg. Support Servs., Inc., No. CIV.A. 1-05-0012, 2006 WL
1529470, at *10 (M.D. Tenn. June 1, 2006) (“An award of attorney fees would benefit other
similarly situated employees whose benefits were denied without a reasoned basis for the denial.”).
Thus, the Court finds it appropriate, in its discretion, to award Plaintiff attorneys’ fees.
D. Count II
Plaintiff also moves to “sever Count 2 under Federal Rule of Civil Procedure 21 and
dismiss it without prejudice because it is preempted.”38 (Doc. No. 88-2 at 17 n.13). Rule 21
provides that the Court may at any time, on motion or on its own, add or drop a party or claim.
Under Rule 21, the Court must make an independent determination that dropping this claim is
appropriate. Here, the Court has little difficulty concluding that the interests of justice support
dropping the claim as requested, given both its potential for increasing judicial efficiency in
resolving this dispute and joining in the motion to drop the claim by Defendants. (Doc. No. 97 at
24). The Court notes that it need not “sever” the claim first in order to dismiss it under Rule 21.
While Plaintiff requests dismissal without prejudice, Defendants request dismissal with
prejudice. (Doc. No. 97 at 24). Courts have found dismissal with prejudice to be appropriate when
a breach of contract claim is preempted by ERISA. See Productive MD, LLC v. Aetna Health, Inc.,
969 F. Supp. 2d 901, 944 (M.D. Tenn. 2013) (dismissing with prejudice “breach of the underlying
The parties concur that Plaintiff’s breach-of-contract claim is preempted by ERISA. The Court agrees
with this conclusion. See Cromwell v. Equicor-Equitable HCA Corp., 944 F.2d 1272, 1276 (6th Cir. 1991)
(“This circuit . . . has repeatedly recognized that virtually all state law claims relating to an employee benefit
plan are preempted by ERISA.”); Daniel v. Eaton Corp., 839 F.2d 263 (6th Cir.), cert. denied, 488 U.S.
826 (1988) (state law breach of contract claim preempted by ERISA).
38
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 33 of 35 PageID #: 1866
insurance contracts” as preempted by ERISA); Wilson v. Unum Grp., No. CV 20-122-DLB, 2021
WL 4268046, at *3 (E.D. Ky. Sept. 20, 2021) (dismissing with prejudice breach of contract claim
as “expressly” preempted by ERISA); Burgos v. Grp. & Pension Administrators, Inc., 286 F. Supp.
2d 812, 819 (S.D. Tex. 2003) (same). Accordingly, Plaintiff’s breach of contract claim (Count II)
will be dismissed with prejudice.
CONCLUSION
One thing in this case seems especially clear: Defendants absolutely do not want Plaintiff
to receive benefits under the Plan. The Court does not presume to tell Defendants that they should
feel otherwise or that their desired result could not have been lawfully achieved. What the Court
can say, however, is that if this is the kind of result Defendants want, they would be well served
to do things differently from how they did things here. It would behoove them to promulgate a
plan with different (and ideally much more comprehensible)39 substantive provisions.40 And it
39
To be clear, the Plan is sufficiently comprehensible for the Court to make each of the determinations
about its construction that the Court has made herein. But that does not change the fact that—as reflected
by the multiple issues regarding the Plan’s terminology and related matters flagged herein by the Court—
the Plan would benefit from substantially more clarity and consistency.
40
The Ninth Circuit has discussed the import of a drafter of an ERISA plan making its intentions
unambiguous:
We think it appropriate to insist, as we did in Kearney, that the text of a plan be
unambiguous. If an insurance company seeking to sell and administer an
ERISA plan wants to have discretion in making claims decisions, it should say so. It is not
difficult to write, “The plan administrator has discretionary authority to grant or deny
benefits under this plan.” When the language of a plan is unambiguous, a company
purchasing the plan, and employees evaluating what their employer has purchased on their
behalf, can clearly understand the scope of the authority the administrator has reserved for
itself. As we wrote in Sandy, it is “easy enough” to confer discretion unambiguously
“if plan sponsors, administrators, or fiduciaries want benefits decisions to be reviewed for
abuse of discretion.” 222 F.3d at 1206. Where they fail to do so, “in this circuit at least,
they should expect de novo review.” Id.
Ingram v. Martin Marietta Long Term Disability Income Plan for Salaried Emps. of Transferred GE
Operations, 244 F.3d 1109, 1113–14 (9th Cir. 2001).
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 34 of 35 PageID #: 1867
would be imperative for them to follow the plan’s procedures for resolving claims, rather than
doing what they did here (despite still refusing to acknowledge it): embark on a sequence of
decisions (or purported decisions) bearing no resemblance to the decision-making (in terms of who
makes what decisions and when) called for by the Plan.
For the reasons discussed herein, the Motion will be granted with respect to Count I, and
Count II will be dismissed with prejudice. An appropriate order and judgment (with respect to
liability only) will be entered.
____________________________________
ELI RICHARDSON
UNITED STATES DISTRICT JUDGE
Case 3:19-cv-01021 Document 171 Filed 08/29/22 Page 35 of 35 PageID #: 1868
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