Filed: Aug. 03, 2005
Latest Update: Feb. 21, 2020
Summary: [DO NOT PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT FILED _ U.S. COURT OF APPEALS ELEVENTH CIRCUIT AUGUST 3, 2005 No. 05-10276 THOMAS K. KAHN Non-Argument Calendar CLERK _ D. C. Docket No. 03-03328-CV-2-IPJ HAYWARD LIPSEY, Plaintiff-Appellant, versus UNION UNDERWEAR PENSION PLAN, Defendant-Appellee. _ Appeal from the United States District Court for the Northern District of Alabama _ (August 3, 2005) Before BLACK, HULL and PRYOR, Circuit Judges. PER CURIAM: After a
Summary: [DO NOT PUBLISH] IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT FILED _ U.S. COURT OF APPEALS ELEVENTH CIRCUIT AUGUST 3, 2005 No. 05-10276 THOMAS K. KAHN Non-Argument Calendar CLERK _ D. C. Docket No. 03-03328-CV-2-IPJ HAYWARD LIPSEY, Plaintiff-Appellant, versus UNION UNDERWEAR PENSION PLAN, Defendant-Appellee. _ Appeal from the United States District Court for the Northern District of Alabama _ (August 3, 2005) Before BLACK, HULL and PRYOR, Circuit Judges. PER CURIAM: After a b..
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[DO NOT PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT FILED
________________________ U.S. COURT OF APPEALS
ELEVENTH CIRCUIT
AUGUST 3, 2005
No. 05-10276
THOMAS K. KAHN
Non-Argument Calendar
CLERK
________________________
D. C. Docket No. 03-03328-CV-2-IPJ
HAYWARD LIPSEY,
Plaintiff-Appellant,
versus
UNION UNDERWEAR PENSION PLAN,
Defendant-Appellee.
________________________
Appeal from the United States District Court
for the Northern District of Alabama
_________________________
(August 3, 2005)
Before BLACK, HULL and PRYOR, Circuit Judges.
PER CURIAM:
After a bench trial, plaintiff Hayward Lipsey appeals the district court’s
judgment in favor of defendant Union Underwear Pension Plan on his ERISA
claim for deferred-vested-pension benefits. After review, we affirm.
I. BACKGROUND
This case presents one question: whether the defendant’s determination that
plaintiff Lipsey was not employed for at least ten continuous years was arbitrary
and capricious. If the answer to that question is yes, then Lipsey is entitled to
deferred-vested-pension benefits. If the answer to that question is no, then Lipsey
is not entitled to deferred-vested-pension benefits.
Before discussing the merits of this case, we outline the relevant pension
plan, plaintiff Lipsey’s work history, and the defendant’s determination that Lipsey
was ineligible for benefits.
A. The Pension Plan
Plaintiff Lipsey began working for Winfield Cotton Mill, Inc. (“Winfield”)
on February 17, 1970. At that time, Lipsey was eligible to participate in the Union
Underwear Pension Plan (“the Plan”), which was sponsored by Winfield’s parent
company, Union Underwear Company.
The Plan provided for five types of pension benefits: (1) normal retirement
benefits for those employees who worked until age 65 and had at least ten years of
2
service; (2) early retirement benefits for those employees who worked until age 55
and had at least ten years of continuous service; (3) disability benefits for those
employees who worked until age 50, had ten years of continuous service, and had
been deemed disabled by the Social Security Administration (“SSA”); (4)
postponed retirement benefits for those employees who worked past the age of 65;
and (5) deferred-vested benefits for those employees who did not meet any of the
four eligibility requirements above but had ten years of continuous service.1
Because Lipsey was only 47-years old when he left Winfield in 1982, it is
undisputed that the only benefits that he is potentially eligible for are the deferred-
vested benefits. It is further undisputed that Lipsey has more than ten years of
service with Winfield. The only issue in this case is whether Lipsey has ten years
of continuous service with Winfield.
B. Lipsey’s Employment
As mentioned above, Lipsey began working for Winfield on February 17,
1970. Lipsey left Winfield on either March 8, 1973, or May 8, 1973. However, he
returned to Winfield on June 20, 1973, and remained employed at Winfield until
August 24, 1982. This second term of employment (June 20, 1973 to August 24,
1982) lasted nine years, two months, and four days. Thus, Lipsey does not have
1
Deferred-vested benefits are paid after the former employee reaches age 65.
3
ten years of continuous service without counting at least some of his prior
employment. Accordingly, the dispute in this case centers around the reason for
Lipsey’s brief absence in 1973.
If Lipsey’s brief absence from Winfield in 1973 was a temporary layoff or a
leave of absence with Winfield’s permission, then Lipsey’s employment with
Winfield prior to June 20, 1973, counts toward his years of continuous service, and
he would have over twelve years of continuous service. However, if Lipsey was
fired or quit in 1973, and was merely rehired on June 20, 1973, then his
employment prior to June 20, 1973, does not count toward his years of continuous
service. Thus, this case boils down to one simple question – what was the reason
for Lipsey’s loss of employment in 1973?
C. Lipsey is Denied Deferred-Vested Benefits
In 2001, Lipsey requested pension benefit claim forms from Union
Underwear, which were not provided. On February 14, 2003, he filed a lawsuit in
the Circuit Court of Marion County, Alabama, arguing that the defendant violated
ERISA by failing to provide the information he requested, failing to provide
benefits, and failing to provide a written explanation as to why he was denied
benefits.
After Lipsey filed suit, Beth Tuck, the Director of Benefits for Union
4
Underwear, conducted a review of Lipsey’s claim.2 Because Winfield was no
longer in business, Lipsey’s employment file could not be located. Thus, Tuck had
to use whatever information was available to determine Lipsey’s eligibility for
benefits.
In researching Lipsey’s eligibility, Tuck located a 1978 benefit statement
regarding Lipsey. According to the benefit statement, Lipsey had no earnings
applied to his pension calculation in 1971 and 1972. Furthermore, the benefit
statement indicated that Lipsey would not become vested in the Plan until June 16,
1983.
Tuck also reviewed an itemized earnings statement from the Social Security
Administration (“SSA”). The SSA statement showed that Lipsey’s earnings from
Winfield were 50% lower during the second quarter of 1973 than his earnings from
other quarters in 1973 and that during the second quarter he earned almost as much
at Alabama Oak Flooring as he earned at Winfield.
Piecing the information together, the committee concluded that Lipsey either
quit or was fired during the second quarter of 1973, and that he was subsequently
rehired on June 20, 1973. The committee further concluded that Lipsey did not
2
The Plan is administered by a retirement committee, which has the duty to “interpret the
plan, decide all questions of eligibility, and determine the amount, manner and time of payment
of any benefits. . . .” The committee currently consists of four persons who are authorized to act
in a meeting or in writing without a meeting. Decisions are made by a majority vote.
5
work for Winfield continuously for ten years and, therefore, was not qualified for
deferred-vested-pension benefits. The committee memorialized this conclusion in
a letter to Lipsey’s counsel:
According to our records, [Lipsey] was hired in 1970, had a break in
service in 1973, and terminated in 1981.3 Because he had a break in
continuous service, all service prior to 1973 is lost. Using these
dates, Mr. Lipsey is not eligible for a pension benefit under the terms
of the Pension Plan.
D. The District Court
The district court conducted a bench trial on Lipsey’s ERISA claim. At the
trial, Lipsey, Tuck, and George Wallace, a former co-worker of Lipsey, testified as
to the reasons for Lipsey’s absence from Winfield in 1973.
At the close of evidence, the district court ruled from the bench. Noting that
the evidence showed that Lipsey had a break in service in 1973 and that no
evidence showed that this break was approved or due to a disability or sickness, the
district court found that Lipsey did not have ten years of continuous service as
required by the Plan to be entitled to a pension.4 Specifically, the district court
stated:
3
Although it is of no consequence to the outcome of this appeal, Mr. Lipsey was
“terminated” from Winfield on August 24, 1982.
4
The district court also denied Lipsey’s claim that the Union Pension Plan failed to
provide him with claims forms, noting that because any letter requesting pension benefits was
treated as a claim, there were no damages to Lipsey.
6
Okay. I am going to find that there was not ten years – that Mr.
Lipsey did not have ten years of continuous service . . . as required by
the plan for him to be entitled to deferred vested pension.
I mean, he was not vested at the time he quit. And I will say,
whether he agrees with me or not, he did quit in 1982. . . .
...
So, although the records are sparse, they all reflect that an event
took place in either March or May of 1973, by which Mr. Lipsey
became unemployed or his employment was terminated. One way or
another, he was detached from. . . [the] Winfield plant, and was
rehired on 6/20/73.
I don’t have anything showing that it was leave of absence that
was approved or disability or sickness. I have statements from Mr.
Lipsey that, at some point, the plant was closed but he doesn’t know
when. Mr. Wallace doesn’t know when it was.
Because the district court found that Lipsey did not have the ten years of
continuous service he needed to be entitled to benefits, the district court concluded
that the committee’s decision was correct, and accordingly, there was “no need to
get into whether or not there needs to be a de novo . . . [or] a heightened standard
of review. . . .”
Lipsey appealed.
II. DISCUSSION
This Court reviews the district court’s review of an ERISA plan
administrator’s benefits eligibility determination “de novo, applying the same legal
standards that governed the district court’s disposition.” Williams v. Bellsouth
7
Telecomms., Inc., 373 F.3d 1132, 1134 (11th Cir. 2004) (citations omitted). The
Plan gave the retirement committee discretion to “interpret the plan, decide all
questions of eligibility, and determine the amount, manner and time of payment of
any benefits. . . .” Thus, we review the exercise of that discretion to determine
whether the defendant’s denial of benefits was arbitrary and capricious.
Id. at 1137
(“[W]here the administrator has discretion (i.e., applies his own judgment) in
making plan decisions, we review under the arbitrary and capricious standard
(which is substantively the same as the ‘abuse of discretion’ standard . . .). We use
it to avoid judicial second guessing/intrusion by according the most judicial
deference (and thus, the least judicial scrutiny).”).
In this case, we simply cannot say that the defendant’s determination that
Lipsey did not have ten years of continuous service was arbitrary and capricious.
The fact remains that although Lipsey’s personnel file was missing, the committee
was within its discretion to determine that the available evidence indicated that
Lipsey was fired or quit in 1973.5 Lipsey is unable to point to any evidence, other
than his own, unspecific testimony, as to the cause of his absence from Winfield in
1973. Given our highly deferential standard of review, we conclude that the
5
The defendant also points to materials that were discovered after the committee
determined that Lipsey was ineligible for benefits and to materials that Tuck may or may not
have considered (she could not remember at trial). We do not consider these materials when
determining whether the committee’s decision was arbitrary and capricious.
8
district court did not err in determining that Lipsey is not entitled to deferred-
vested-pension benefits. See Sharron v. Amalgamted Ins. Agency Servs., Inc., 704
F.2d 562, 564 (11th Cir. 1983) (“Accordingly, a court should enforce a decision of
pension fund trustees even though the court may disagree with it, so long as the
decision is not arbitrary or capricious.”).6
AFFIRMED.
6
Lipsey’s claim that the district court abused its discretion in denying attorney’s fees is
without merit.
9
