Barrickman v. Locals 302 and 612 of the International Union of Operating Engineers-Employers Construction Industry Retirement Plan

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ALASKA
WILLIAM BARRICKMAN, )
)
Plaintiff, )
)
vs. )
)
LOCALS 302 AND 612 OF THE )
INTERNATIONAL UNION OF OPERATING )
ENGINEERS-EMPLOYERS CONSTRUCTION )
INDUSTRY RETIREMENT FUND, )
) No. 3:14-cv-0051-HRH
Defendant. )
__________________________________________)
O R D E R
Cross-Motions for Summary Judgment
Defendant moves for summary judgment.1 This motion is opposed and plaintiff
cross-moves for summary judgment.2 Oral argument has been heard.
Facts
Plaintiff is William Barickman.3 Defendant is Locals 302 and 612 of the International
Union of Operating Engineers - Employers Construction Industry Retirement Plan.
1Docket No. 13.
2Docket No. 24.
3The correct spelling of plaintiff’s last name is “Barickman” not “Barrickman.”
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Plaintiff worked out of Local 302 as “a journeyman operating engineer performing
road construction”4 for 19 years. Plaintiff operated dozers, loaders, backhoes, and
excavators.5
Plaintiff was a participant in the Plan, which is an ERISA plan. The Plan is
governed by a Board of Trustees.
On June 14, 2012, plaintiff submitted an application for retirement benefits under the
Plan.6 Plaintiff applied for early retirement to be effective August 1, 2012.7 In his
application, plaintiff advised that he was currently employed by the Mat-Su Borough as
a road superintendent.8
In order to be entitled to early retirement benefits, a plan participant may not
“perform 51 or more hours of Post-Retirement Service in a calendar month[.]”9 The Plan
defines “Post-Retirement Service” as
all employment:
4Admin. Rec. at 173, Docket No. 9.
5Admin. Rec. at 153-154, Docket No. 9.
6Admin. Rec. at 124, Docket No. 9.
7Admin. Rec. at 124, Docket No. 9.
8Admin. Rec. at 126, Docket No. 9.
9Admin. Rec. at 44, Docket No. 9.
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(a) within the geographic area covered by the Plan which
for purposes of this Section shall consist of all of the
State of Alaska and the State of Washington;
(b) in a job classification in which the Participant was
employed while in a Covered Employment, whether or
not such employment is under the terms of a Collective
Bargaining Agreement or written Contribution Agree-
ment or in a supervisory capacity over such job classifi-
cation; and
(c) in the industry in which the Individual Employers
participate (any business activity of the type engaged in
by the Individual Employers maintaining the Plan).[10]
On August 3, 2012, the Plan Administration Office advised plaintiff that his
application for early retirement benefits was being denied because “it has been determined
that your work at the Matanuska-Susitna Borough is considered to be Post Retirement
Service.”11 Plaintiff was advised that he had “the right to request an appeal hearing before
the Board of Trustees” as long as a request for such a hearing was filed within 60 days.12
This was consistent with the Plan’s appeal procedures, which provide that “[a]ny
Participant ... who applies for benefits and is ruled ineligible ... shall have the right to
appeal to and request that the Board of Trustees conduct a hearing in the matter.”13
10Admin. Rec. at 45, Docket No. 9.
11Admin. Rec. at 130, Docket No. 9.
12Admin. Rec. at 130, Docket No. 9.
13Admin. Rec. at 81, Docket No. 9.
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On August 17, 2012, plaintiff requested an appeal hearing before the Board of
Trustees.14 Plaintiff contended that his “covered employment” with Local 302 did not
include administrative work which was the type of work he did in his current job with the
Mat-Su Borough.15
On September 10, 2012, counsel for the Plan provided plaintiff with “additional
information regarding the appeal procedures.”16 In addition to providing plaintiff with
information about how the hearing would be conducted, counsel for the Plan advised
plaintiff that
[f]ollowing the hearing, the Trustees will issue a written
decision. If you are dissatisfied with the written decision of the
Trustees, you may bring a civil action under Section 502(a) of
[ERISA]. A civil action must be brought no later than 180 days
after the date on which the Trustees’ decision is issued.[17]
The appeal hearing was held on September 24, 2012.18 On October 1, 2012, the
Trustees denied plaintiff’s appeal because they “determine[d] that [plaintiff’s] work as a
Road Superintendent I satisfies Plan Sections 6.01(a),(b), and (c) and is therefore Post-
14Admin. Rec. at 132, Docket No. 9.
15Admin. Rec. at 134, Docket No. 9.
16Admin. Rec. at 138, Docket No. 9.
17Admin. Rec. at 138, Docket No. 9.
18Admin. Rec. at 172, Docket No. 9.
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Retirement Service for which benefits would be suspended if he retired.”19 The Trustees
explained that they “have consistently given a broad interpretation to the term ‘job
classification’” and that “[i]n interpreting the term, [they] have compared the duties and
skills used by the participant.”20 Using this “skills and duties” test, the Trustees concluded
that plaintiff was using skills that he acquired as a journeyman operator to perform his job
as a Road Maintenance Superintendent I and that he had many of the same duties in that
job as he had as a journeyman operator.21
The cover letter transmitting the Trustees’ decision advised plaintiff that if he was
“dissatisfied with the Trustees’ determination, [he could] bring a civil action under Section
502(a)” of ERISA and that any such action “must be brought no later than 180 days after
the date of this letter.”22 Plaintiff was further advised that “[f]ailure to file a civil action
within that 180-day period will operate as a waiver of and bar to the right to review, and
the decision of the Trustees shall be final and binding.”23 This is consistent with the appeal
procedures set forth in Section 12.02 of the Plan, which provide that
19Admin. Rec. at 179, Docket No. 9.
20Admin. Rec. at 178, Docket No. 9.
21Admin. Rec. at 178-179, Docket No. 9.
22Admin. Rec. at 171, Docket No. 9.
23Id. Plaintiff was also advised of the 180-day time limit in which to file a civil action
in connection with the initial denial of his application for early retirement benefits. Admin.
Rec. at 131, Docket No. 9.
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[f]ollowing issuance of the written decision of the Trustees on
an appeal, there is no further right of appeal to the Trustees.
Instead, the claimant may bring a civil action under ERISA, §
502(a). Any action must be brought no later than 180 days
after the date on which the Trustees’ decision was issued.
Failure to file a civil action within that 180-day period will
operate as a waiver of and bar to the right of review, and the
decision of the Trustees will be final and binding.[24]
The Plan further provides that
[t]he procedure specified in [Section 12.02] shall be the sole and
exclusive procedure available to a Participant or beneficiary
who is dissatisfied with an eligibility determination, benefit
award, or who is adversely affected by any such action of the
Trustees.[25]
Plaintiff did not file a civil action within 180 days of October 1, 2012, the date on
which the Trustees made their decision. Plaintiff alleges that he “did not do so because he
was aware of the Alaska U.S. District Court’s decision denying a similar appeal in a case
against the same ‘Plan’ ... and therefore reasonably believed such an appeal in a lawsuit in
the Alaska U.S. District Court would be futile.”26
The district court case in question was Tapley v. Locals 302 and 612 of International
Union of Operating Engineers-Employers Construction Industry Retirement Plan, Case No.
3:10-cv-0033-HRH. There, this court upheld the Trustees’ determination that the plaintiffs’
24Admin. Rec. at 104, Docket No. 9.
25Admin. Rec. at 84, Docket No. 9.
26Complaint at 4, ¶ 15, Docket No. 1.
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“post-retirement jobs as a traffic flagger and snow plow operator fell into the same ‘job
classification’ as their former union jobs as skilled mechanics.” Tapley v. Locals 302 and
612 of International Union of Operating Engineers-Employers Construction Industry
Retirement Plan, 728 F.3d 1134, 1136 (9th Cir. 2013). The Ninth Circuit reversed. The
appellate court took issue with the Trustees’ application of their “skills and duties” test
because the test was based on “insignificant and incidental similarities” between Tapley’s
and Chapman’s union jobs and their post-retirement jobs “[r]ather than acknowledging
th[e] significant difference in core skills used for each job....” Id. at 1141-42. Because the
court was “unable to see how any sensible application of the skills and duties test to the
established facts c[ould] support the Trustees' conclusion”, it reversed. Id. at 1143.
Upon remand, the Trustees determined that Tapley and Chapman were entitled to
early retirement benefits.27 As to any “retirement applications initially received or eligible
for appeal on or after September 6, 2013, and not otherwise barred by the applicable statute
of limitations or contractual limitations periods,” the Trustees were “enjoined from denying
retirement benefits to participants engaged in post-retirement employment, based on a
definition of ‘job classification’ using their incidental duties of post-retirement occupations
to place them under the same ‘job classification’ as covered employment[.]”28
27See Final Judgment, Case No. 3:10-cv-0033-HRH at 1-2, Docket No. 108.
28Id. at 2.
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On November 11, 2013, plaintiff filed a new application for early retirement benefits
to be effective January 1, 2014.29 Plaintiff advised that he was still working for the Mat-Su
Borough “as a road superintendent.”30 Plaintiff’s new application was accompanied by a
letter from his counsel. In that letter, plaintiff’s counsel requested that the Trustees
“reconsider and reverse their decision in the Barickman appeal decided on 9/24/12.”31 If
the Trustees declined to reconsider their 2012 decision, plaintiff’s counsel advised that
plaintiff would “press the new application as far as it takes to obtain [plaintiff] his earned
benefits under the plan.”32
On December 31, 2013, defense counsel advised plaintiff’s counsel that plaintiff was
“time-barred from further consideration of the Trustees’ determination that his position as
a Road Superintendent I for the Matanuska-Susitna ... Borough is Post-Retirement
Service.”33 As for plaintiff’s new application for retirement benefits, defense counsel
29Admin. Rec. at 184, Docket No. 10.
30Admin. Rec. at 186, Docket No. 10.
31Admin. Rec. at 182, Docket No. 10.
32Admin. Rec. at 182, Docket No. 10.
33Admin. Rec. at 187, Docket No. 10.
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advised that plaintiff was “not entitled to reconsideration of the identical issue by simply
filing a new retirement application.”34
In a January 23, 2014 response, plaintiff’s counsel suggested that plaintiff’s request
for reconsideration was not time-barred because the 180-day period might be considered
“unreasonably short[.]”35 Plaintiff’s counsel also contended that plaintiff was “entitled to
a hearing before the trustees” on his new application for retirement benefits.36 Plaintiff’s
counsel requested that “[i]f you are denying him the right to appeal any denial of benefits
this year, please do so in writing so we can advise the court we were denied an appeal
procedure.”37
On February 11, 2014, defense counsel advised that
[t]he Trust is not denying Mr. Barickman the right to appeal
any denial of benefits. As indicated in our December 31, 2013
letter, Mr. Barickman previously had an appeal on the determi-
nation that he is working in Post-Retirement Service. The
Trustees reviewed that appeal and Mr. Barickman was given
180 days to bring a civil action. He did not file a civil action
within that time period. Accordingly, Mr. Barickman already
exercised his right of appeal on that issue.... Mr. Barickman is
not entitled to a second appeal on that issue.
If there is an issue, other than that concerning whether
Mr. Barickman is working in Post-Retirement Service which
34Admin. Rec. at 188, Docket No. 10.
35Admin. Rec. at 190, Docket No. 10.
36Admin. Rec. at 190, Docket No. 10.
37Admin. Rec. at 190, Docket No. 10.
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was previously appealed, then Mr. Barickman should submit
a request for an appeal according to the Plan’s appeal proce-
dures.[38]
On March 18, 2014, plaintiff commenced this ERISA action. In his complaint,
plaintiff seeks to have the court either rule that he is entitled to benefits or remand this
matter to the Trustees for a hearing on his second application. Plaintiff also seeks to enjoin
the Trustees from broadening the definition of “job classification” and from denying plan
participants the right to reapply for pension benefits following the Tapley decision.
Defendant now moves for summary judgment dismissing plaintiff’s complaint on
the grounds that it is time-barred by the 180-day contractual limitations period. Plaintiff
cross-moves for summary judgment on the issue of whether the Trustees abused their
discretion by not allowing him to reapply for benefits because of the change in plan
interpretation. Alternatively, plaintiff argues that his complaint is not barred by the statute
of limitations. In his opposition and cross-motion, plaintiff contends that “the main issue
for the [c]ourt is whether changes in plan interpretation, like changes in fact, permit a
participant to file a new application for benefits” and that “[t]he merits of the Trustees[‘]
decision to deny benefits to [him] is not presently before the [c]ourt.”39
38Admin. Rec. at 191, Docket No. 10.
39Plaintiff’s Memorandum [etc.] at 2-3 & 9, Docket No. 24.
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Discussion
The traditional summary judgment standards apply to an ERISA statute of
limitations summary judgment motion. Chuck v. Hewlett Packard Co., 455 F.3d 1026, 1031
(9th Cir. 2006). The court views “the evidence ‘in the light most favorable to the
nonmoving party ... [and] determine[s] whether there are any issues of material fact....’”
Id. (quoting Wetzel v. Lou Ehlers Cadillac, 222 F.3d 643, 646 (9th Cir. 2000)).
“There are two parts to the determination of whether a claimant’s ERISA action is
timely filed[.]” Withrow v. Halsey, 655 F.3d 1032, 1035 (9th Cir. 2011). The court “must
determine first whether the action is barred by the applicable statute of limitations, and
second whether the action is contractually barred by the limitations provision in the
policy.” Id. The only issue here is whether plaintiff’s action is barred by the 180-day
contractual limitations period.
There is no dispute that the Plan provides that a participant has 180 days in which
to file a civil action if he wishes to appeal a decision by the Trustees. Defendant argues that
plaintiff is seeking review of the Trustees’ October 1, 2012 decision to deny him early
retirement benefits and because plaintiff’s complaint was filed more than 180 days after
October 1, 2012, it was time barred.
The court “must give effect to the Plan’s limitations provision unless [it]
determine[s] ... that the period is unreasonably short[.]” Heimeshoff v. Hartford Life &
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Acc. Ins. Co., 134 S. Ct. 604, 612 (2013). Plaintiff argues that the 180-day contractual
limitations period is unreasonably short. In support of his argument, plaintiff cites to
Baptist Memorial Hospital--DeSoto Inc. v. Crain Automotive Inc., Case Nos. 08-60949,
08-61119, 2010 WL 3278258, at *5 (5th Cir. Aug. 19, 2010). There, the court found a one-
year contractual limitations period too short for two reasons. “First the one-year
limitations period begins to run when a participant merely files a completed claim,
potentially long before the claimant’s ERISA cause of action even accrues.” Id. The court
explained that “the Crain Plan’s claim and internal appeal procedures could take as long
as 330 days, leaving an unsatisfied claimant with only 35 days to file suit.” Id. Second, the
court found that the plan administrator had led “BMHD to believe that its claim was
actively under consideration,” even when it was not. Id. at *6.
Plaintiff’s reliance on Crain Automotive is misplaced because the primary reason the
court found the one-year contractual limitations period unreasonable was because the
limitations period began to run prior to the completion of the administrative process. Here,
the 180-day period does not begin to run until a Plan participant has exhausted all of his
administrative remedies. And, unlike in Crain Automotive, the Trustees were not
providing plaintiff with misleading information about the status of his claim.
Plaintiff next argues that the 180-day limitations period is unreasonable because it
is shorter than what is usually provided for by statute. But, as defendant points out, there
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are statutory limitations periods that are shorter than 180 days. See 42 U.S.C. § 2000e-16(c)
(90-day period for federal employees to file a EEOC lawsuit); 42 U.S.C. § 1395ff(b)(2)(C) (60-
day period for appeal of Medicare determinations); 42 U.S.C. § 405(g) (60-day period in
which to seek judicial review of Social Security benefits decisions).
Plaintiff also seems to suggest that a 180-day contractual limitations period is
unreasonably short because six months is not enough time for a Plan participant to retain
counsel, which plaintiff contends is a necessary requirement for filing a civil action. But six
months is sufficient time in which to retain counsel.
The court finds the 180-day contractual limitations period reasonable for the same
reasons the court in Northlake Regional Medical Center v. Waffle House System Employee
Benefit Plan, 160 F.3d 1301 (11th Cir. 1998), found a 90-day limitation period reasonable.
First, nowhere in the record is there any suggestion that the
Plan’s 90–day limitations period was a subterfuge to prevent
lawsuits. Unlike an insurance company, the Plan does not exist
to make a profit. It is funded by contributions from participat-
ing employees and the employer, not by a contract of insurance
with a third-party issuer.
Id. at 1304. Similarly here, there is no evidence in the record that the 180-day period was
intended to prevent lawsuits. “Second, the 90–day limitations period is commensurate
with other Plan provisions that are designed to process claims with dispatch.” Id. Here
too, the Plan makes provision for prompt claim decisions. And third,
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[t]he 90–day limitations period in this case did not begin to run
until after the last stage of this administrative process, the Plan
Trustees’ decision on review. The time required by the Plan’s
internal appeals process (ten months here) plus the additional
ninety days of the limitations period provided an adequate
opportunity for Northlake to investigate the claim and file suit.
Id. Here, as discussed above, the 180-day limitations period does not begin to run until all
administrative remedies have been exhausted. Thus, plaintiff’s claim that the Trustees
should have reconsider their original decision to deny him retirement benefits is barred by
the statute of limitations.
As for plaintiff’s second application for retirement benefits, plaintiff argues that the
Trustees abused their discretion when they refused to consider his second application
because they denied him meaningful access to the Plan’s administrative procedures.
Under the abuse of discretion standard, “a plan administrator’s decision ‘will not be
disturbed if reasonable.’” Stephan v. Unum Life Ins. Co. of Amer., 697 F.3d 917, 929 (9th
Cir. 2012) (quoting Conkright v. Frommert, 559 U.S. 506, 521 (2010)). “This reasonableness
standard requires deference to the administrator’s benefits decision unless it is ‘(1) illogical,
(2) implausible, or (3) without support in inferences that may be drawn from the facts in
the record.’” Id. (quoting Salomaa v. Honda Long Term Disability Plan, 642 F.3d 666, 676
(9th Cir. 2011)).
“Under ERISA, plan administrators must follow certain practices when processing
and deciding plan participants’ claims.” Abatie v. Alta Health & Life Ins. Co., 458 F.3d 955,
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971 (9th Cir. 2006). According to ERISA’s procedural requirements, claims procedures
must “contain administrative processes and safeguards to ensure and to verify that benefit
claim determinations are made in accordance with governing plan documents....” 29 C.F.R.
§ 2560.503–l(b)(5).
Although the Plan contains detailed claims procedures, there is no provision in the
Plan for filing a second application for retirement benefits if the participant’s first
application has been denied. But, the Trustees have suggested that a change in circum-
stance might be a sufficient reason to allow a participant to file a second application. In the
December 31, 2013 letter to plaintiff’s counsel, defense counsel wrote that “[t]here has been
no suggestion that Mr. Barickman’s employment status changed after the Trustees found
he is working in Post-Retirement Service. Accordingly, the Trustees’ prior determination
is final and binding and Mr. Barickman is not entitled to reconsideration of the identical
issue....”40 This suggests that if plaintiff had changed jobs or quit his job, he could reapply
for retirement benefits because the prior decision that his job as a Road Maintenance
Superintendent I was disqualifying would not apply to a different job or would not apply
if he had no job. At oral argument, defense counsel confirmed that it was the Trustees’
position that if plaintiff had changed jobs or if there had been some other significant change
in circumstances, the Trustees would have considered plaintiff’s second application.
40Admin. Rec. at 188, Docket No. 10.
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Plaintiff argues that the Tapley decision constitutes a significant change in
circumstances and thus the Trustees should have considered his second application on its
merits. Defendant disagrees.
Defendant argues that the Plan’s definition of “job classification” was not amended
after the Ninth Circuit’s decision in Tapley and that the Trustees did not stop using the
“skills and duties” test that it had used prior to Tapley to determine if post-retirement
employment was the same “job classification” as covered employment. Defendant argues
that just because the skills and duties in Tapley were too incidental that does not mean that
the skills and duties in plaintiff’s case are also too incidental. In fact, defendant insists that
there was a significant overlap between the core skills and duties plaintiff used as a
equipment operator constructing roads and the core skills and duties plaintiff uses as a
Road Maintenance Superintendent I. In short, defendant argues that nothing changed in
how the Trustees’ interpret the Plan after Tapley and thus the Tapley decision is not a
significant change in circumstances.
The court disagrees. Prior to Tapley, the Trustees were employing a “skills and
duties” test that was based on incidental duties, rather than core duties. After Tapley, the
Trustees may no longer look at incidental duties to determine whether a Plan participant’s
covered employment is in the same job classification as the participant’s post-retirement
work. This is a significant change in how the Trustees will evaluate whether a Plan
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participant’s post-retirement employment is in the same “job classification” as his covered
employment. Because the Tapley decision was a significant change in circumstances and
because the Trustees interpret the Plan to allow a Plan participant to reapply for benefits
if there has been a significant change in circumstances, it was an abuse of discretion for the
Trustees to not consider plaintiff’s post-Tapley application for early retirement benefits.
Conclusion
Defendant’s motion for summary judgment is granted as to plaintiff’s claim that the
Trustees should have reconsidered their original decision to deny him retirement benefits.
Defendant’s motion for summary judgment is otherwise denied. Plaintiff’s cross-motion
for summary judgment is granted as to his claim that the Trustees abused their discretion
in failing to consider his second application on its merits. Plaintiff’s cross-motion is
otherwise denied.
The matter is remanded to the Trustees to consider plaintiff’s second application for
early retirement benefits on its merits.
DATED at Anchorage, Alaska, this 26th day of January, 2015.
/s/ H. Russel Holland
United States District Judge
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