Free Motion for Summary Judgment - District Court of Arizona - Arizona

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SUSAN MARTIN (AZ#014226) DANIEL L. BONNETT (AZ#014127) JENNIFER KROLL (AZ#019859) MARTIN & BONNETT, P.L.L.C. 3300 N. Central Avenue, Suite 1720 Phoenix, Arizona 85012-2517 Telephone: (602) 240-6900 [email protected] [email protected] [email protected] Attorneys for Plaintiffs IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF ARIZONA Barbara Allen, Richard Dippold, Melvin Jones, Donald McCarty, Richard Scates and Walter G. West, individually and on behalf of all others similarly situated, Plaintiffs, vs. Honeywell Retirement Earnings Plan, Honeywell Secured Benefit Plan, Plan Administrator of Honeywell Retirement Earnings Plan and Plan Administrator of Honeywell Secured Benefit Plan, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) )

No. CV04-0424 PHX ROS

Plaintiffs Motion for Partial Summary Judgment Dismissing Defendants Statute of Limitations Defense

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INTRODUCTION Plaintiffs move this Court for an order dismissing Defendants affirmative defense based on the statute of limitations. This motion is supported by Plaintiffs Separate Statement of Material Facts Not in Dispute in Support of Plaintiffs Motion for Partial Summary Judgment Dismissing Defendants Statute of Limitations Defense and the exhibit thereto ( SOF ) and the record before this Court. Summary judgment is appropriate because, as a

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matter of law, the evidence upon which Defendants rely does not meet their burden to establish an unmistakable and continuous repudiation of Plaintiffs claims sufficient to trigger the running of the statute of limitations prior to denial of Plaintiffs administrative claims in October 2003. See Fed. R. Civ. P. 56. Defendants have attempted to make much ado about the fact that Plaintiffs claims relate to Plan changes made in 1984 and 1993, but the fault lies with them. Before the statute of limitations could begin to run, Defendants were required to clearly and unmistakably repudiate Plaintiffs claims. Here, no notice or clear repudiation occurred. To foreclose Plaintiffs from their day in court because of the passage of time would be to reward Defendants and to encourage others to keep plan and ERISA violations a secret. In Chuck v. Hewlett Packard, 455 F.3d 1026, 1038 (9th Cir. 2006), the court held that there had been

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a clear repudiation that triggered the running of the statute of limitations based on a combination of six compelling factors that led the court to conclude that by 1992 (twelve years after the plaintiff had retired), he could not have reasonably believed but that his claim had been finally denied. The court held that the statute of limitations did not begin to run at the time of the plan s first letter rejecting the plaintiff s claim, but only after the plaintiff had received a series of communications through which, taken as a whole, the company s final denial of the plaintiff s claims could not have been plainer or more consistent with its

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earlier views and where the plaintiff admitt[ed] that he was aware of the plan s position that he was not eligible for further pension benefits. In distinguishing Chuck from the facts present here, this Court stated: Based on these unusual facts, the Court reluctantly determined that there was a clear and continuing repudiation of a claimant s rights under the plan such that his claims were barred. In the present case, we have no such compelling facts. (Doc. 226, Order dated September 6, 2006, p. 15, citing Chuck.) The Court noted that courts have been clear that the repudiation must be unequivocal or unmistakable. (Id.) In contrast, this Court found that [m]uch of Defendants evidence is based on speculation, and they are largely in possession of the evidence [regarding] the statute of limitations... (Id.) The Court concluded Defendants have not established a threshold that the documents presented triggered the statute of limitations. (Id.)

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PROCEDURAL HISTORY Plaintiffs first requested Plan documents from Defendants in June 2001 and asked for, inter alia, the Signal Company s Retirement Plan plan document as in effect in 1983 and thereafter and all amendments thereto. (SOF ¶ 1.) On or about August 15, 2001, Defendants provided the Signal Retirement Plan documents dated October 28, 1985 and May 1, 1986. (Doc. 2.) It took Defendants until October 2003, over two years, three months after Plaintiffs requested the applicable Signal Plan documents, for Defendants to provide the document they claim constituted the official Plan document first applicable to Garrett Plan participants: a Signal Retirement Plan document dated February 4, 1984 purporting to be effective as of January 1, 1984. (SOF ¶ 3.) Plaintiffs did not receive the requested 1983 Signal Plan

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document until March 2007, several years after this lawsuit was commenced. (SOF ¶ 4.) Defendants also failed to furnish critical documents which were part of the Garrett
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Retirement Plan and were necessary to verify how the retirement benefits were required to be calculated. It took until June 2003, two years following Plaintiffs initial requests for Plan documents and after Plaintiffs claims were initially denied for Defendants to furnish Exhibit B to the Garrett Retirement Plan. (SOF ¶ 9.) Plaintiffs claims were first asserted under the Plan s claims procedures on July 26, 2002. (SOF ¶ 10.) They were finally determined in an appeal to the Plan by decision dated October 29, 2003.1 (SOF ¶ 11.) Defendants have been on clear notice of Plaintiffs claims since 2002. Defendants have had more than five years in which to marshal any evidence that might be relevant to meeting their burden to demonstrate that communications emanating from the Defendants clearly and unequivocally repudiated the instant claims so as to trigger or extinguish Plaintiffs right to recovery under the partial judgment rendered in their favor. They have produced no such evidence. The order dated July 19, 2005 granted summary judgment for Plaintiffs on Plaintiffs anti-cutback claims, Plaintiffs minimum benefits claims and Plaintiffs ERISA Section

204(h) claims. (Doc. 73.) Allen v. Honeywell Ret. Earnings Plan, 382 F.Supp.2d 1139, 1173 (D. Ariz. 2005). On August 26, 2005, Plaintiffs moved for Class Certification. (Doc. 84.) In a series of briefs, Defendants opposed Plaintiffs motion on the grounds that a statute of limitations defense required an individualized inquiry making class treatment unsuitable.

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(Doc. 146, Doc. 161, Doc. 185, 186 (same brief filed twice).) Along with their first 28 page

From January 24, 2003 through March 1, 2004, the action was tolled pursuant to a tolling agreement between the parties. (SOF ¶12.) Even in the absence of a tolling agreement, the statute of limitations would have been tolled during the pendency of the administrative process, which commenced on or about July 26, 2002. See, e.g., Chappel v. Laboratory Corp. of America, 232 F.3d 719 (9th Cir. 2000); Northern Cal. Retail Clerks Unions v. Jumbo Markets, Inc., 906 F.2d 1371, 1372 (9th Cir. 1990); Counts v. American General Life and Acc. Ins. Co., 111 F.3d 105, 108 (11th Cir. 1997). This case was filed on March 1, 2004, a few months after the claims were denied by Defendants and prior to expiration of the tolling agreement.
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brief, Defendants filed a supporting declaration with 22 exhibits addressed to their statute of limitations defense. (Doc. 147.) Prior to the ruling on class certification, Defendants served a questionnaire and requests for production of documents which they endeavored to serve on all absent class members, arguing that such questionnaires were relevant to the statute of limitations issues. Plaintiffs moved for a protective order. (Doc 162.) The Court denied Defendants request

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to serve discovery on absent class members but allowed Defendants to take discovery of the six named Plaintiffs and permitted Defendants to file a supplemental brief in opposition to Plaintiffs class certification motion. (Transcript of June 16, 2006 proceedings, Doc.175, pp. 8-9.) Along with their 31 page supplemental brief, Defendants also filed six additional declarations and additional documentary evidence all in a failed attempt to demonstrate the existence of a statute of limitations defense. (See Doc. 187-193.) Unpersuaded by Defendants evidence, by order dated September 6, 2006, the Court granted Plaintiffs Motion for Class Certification ruling that: Defendants have not established a threshold that the documents presented triggered the statute of limitations. (Doc. 226, p. 15.) At a November 2, 2007 status conference, the parties agreed that a ruling on legal issues2 implicated in the statute of limitations defense would advance the resolution of the

On November 6, 2007, the Court entered an order preliminarily approving a Partial Settlement between the parties. (Doc. 319.) The Partial Settlement resolves all but the following claims as defined in the Partial Settlement Agreement: Minimum Benefits Claim means the claims, purported to be brought under ERISA §§ 502(a)(1)(B) and 502(a)(3), that Defendants violated the terms of the Signal Retirement Plan by applying the SBA Offset to the minimum benefit formulas of § 4.2(c)(i) of the Signal Retirement Plan, and that Defendants violated ERISA §§ 204(g) and 204(h) by amending the Signal Retirement Plan to apply the SBA Offset to such minimum benefit formulas. SBA Offset Claim means the claims, purported to be brought under ERISA §§ 502(a)(1)(B) and 502(a)(3), that Defendants violated ERISA § 204(g) by
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case.3 After hearing discussion from both sides, the Court indicated a willingness to review motions addressed to the legal issues surrounding the statute of limitations. In accordance with the scheduling order entered on November 14, 2007,(Doc. 322, p. 4), the parties have conferred in an effort to resolve issues concerning discovery to absent class members and briefing on the statute of limitations and were unable to resolve their differences. Accordingly, Plaintiffs request the Court to enter an order dismissing the statute of limitations defense. Defendants cannot meet their burden to show that they clearly, unequivocally and continuously repudiated the claims in this case before October 2003.

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I. ARIZONA S SIX YEAR CONTRACT STATUTE OF LIMITATIONS APPLIES Because the Plan document constitutes a contract between the Plan and Plaintiffs who seek recovery of benefits as a result of Defendants ERISA and plan violations, the appropriate statute of limitations is Arizona s six year contract statute of limitations. Ariz. Rev. Stat. § 12-548. Wetzel v. Lou Ehlers Cadillac Group., 222 F.3d 643, 648 (9th Cir.

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increasing from 3.5% to 7.5% the interest rate used to project forward a portion of Secured Benefit Account balances from termination of employment to age 65 for purposes of calculating the SBA Offset following the merger of the Garrett Retirement Plan into the Signal Retirement Plan The SBA offset claims for early retirement benefits along with benefits for persons who left employment before age 65 but did not retire until a later age.. Social Security Offset Claim means the claims, purported to be brought under ERISA §§ 502(a)(1)(B) and 502(a)(3), that Defendants violated ERISA § 204(g) by applying the Social Security offset formula contained in Section 4.2(b) of the Signal Retirement Plan to service credited before January 1, 1984. (Doc. 312, Exh. A, at pp. 10-11, 15-16, 18.) If the Court determines that the referenced documents do not clearly repudiate the claims at issue then (aside from the other reasons such discovery is not warranted), discovery against absent class members regarding receipt or knowledge of various documents would be irrelevant.
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2000) (en banc) (the controlling statute of limitations for an action to recover benefits is the state statute for claims on written contracts). McElwaine v. U.S. West, Inc., 176 F.3d 1167, 1170 (9th Cir. 1999) ( The statute of limitations for an ERISA benefits action is based on the applicable statute of limitations for a contract claim in the forum state. Arizona, the forum state, has a six year statute of limitations. ). The parties are in agreement that all of the remaining claims are asserted under ERISA Sections 502(a)(1)(B) and 502(a)(3). See n.3, supra, citing Doc. 312, Exh. A, at pp. 10-11, 15-16, 18. The contract statute of limitations is the most closely analogous because the rights

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to benefits at issue unequivocally arise from Plan promises that were violated by application of Plan amendments to benefits earned before the Plan amendments were adopted as this Court made clear in its summary judgment ruling. 382 F.Supp.2d at 1154-55. See May Dep t Stores Co. v. FDIC., 305 F.3d 597, 601(7th Cir. 2002) ( The benefits sought were plan benefits; the question was how to compute them. The answer was given by ERISA, but that is just to say that, like many other contracts, pension plans governed by ERISA contain provisions implied by law... ). See also Allied Chemical and Alkali Workers of America, Local Union No. 1 v. Pittsburgh Plate Glass Co., 404 U.S. 157, 182. (1971) (vested retirement benefits create enforceable contract rights).

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There is no reason to deviate from application of the rule that the forum state s law should apply. As Defendants are well aware, each of the named Plaintiffs worked for Honeywell or its predecessor companies in Arizona. (SOF ¶13.) The Garrett Retirement Plan, the contract between the parties, became a binding contract within this State by virtue of named Plaintiffs employment in Arizona and the statute of limitations for contracts created

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within this State should apply. See Steward v. Atlantic Nat. Bank of Boston, 27 F.2d 224, 225-27 (9th Cir. 1928) (interpreting predecessor to Ariz. Rev. Stat. §12-548 and finding that Arizona statute of limitations for contracts executed within the state applied where notes

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executed in blank outside the State became a binding contract when they were delivered and signed in Arizona); Hendricks v. Smartvideo Technologies, Inc., 511 F.Supp.2d 1219, 1226 (M.D. Fla. 2007). See also Etienne v. Wolverine Tube, Inc., 12 F.Supp.2d 1173, 1183 n.7 (D.Kan. 1998); Davis v. Connecticut General Life Ins. Co., 743 F.Supp. 1273, 1278 (M.D.Tenn. 1990). See Garrett Retirement and Severance Plan SPD, p. 6, (SOF ¶ 14), (employees become eligible to participate in the Retirement Plan At the time [they] are hired as a permanent full-time employee of the Garrett Corporation. ).

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II. PLAINTIFFS CLAIMS WERE TIMELY A. There Was No Clear and Continuing Repudiation of Plaintiffs Claims Under the federal discovery rule, a cause of action does not accrue and the statute of limitations does not begin to run in an ERISA case until there has been a clear and unequivocal denial and repudiation of the plaintiff s claims. See ABA Section of Labor &

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Employment Law Employee Benefits Law 889 (2d ed. 2000) ( Generally, the Circuit courts hold that a claim for relief under § 502(a)(1)(B) does not accrue until there is a formal and final denial of benefits as contemplated in the plan s claim procedure. ). In this case, as under the general rule, no repudiation occurred until Plaintiffs claims were formally denied in October 2003 under the Plan s claims and appeals procedures. (SOF ¶11.) See Martin v.

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Constr. Laborers Pension Trust for S. Cal., 947 F.2d 1381,1384 (9th Cir. 1991); Wetzel, 222 F. 3d at 648. While it is possible in a given case to conclude that a repudiation sufficient to trigger the statute of limitations could arise before a final determination of the administrative

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appeal, this is not one of them. As the Court stated, under the federal discovery rule: Defendants must show Plaintiffs had knowledge of the injury, i.e., that their benefits were reduced by Plan amendments. Thus, a plaintiff cannot be charged with knowledge, actual or constructive, until the defendant shows that it clearly repudiated the plaintiffs claims. (Order on class certification, Doc. 226, p. 11.) The Court also ruled that in order to trigger the running of the statute of limitations, the repudiation of the plaintiffs claims must be

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clear and unmistakable. (Id., p. 15, citing Chuck v. Hewlett Packard, 455 F.3d 1026 (9th Cir. 2006)). Defendants never repudiated Plaintiffs claims before determining Plaintiffs administrative appeal in October 2003. B. Plaintiffs Minimum Benefits Claims Are Timely The Court granted summary judgment on Plaintiffs claims that the terms of the Signal Retirement Plan and successor plans were violated by applying an SBA offset to the minimum benefits formulas because the Signal Plan document unambiguously did not

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provide for such an offset. Allen, 382 F.Supp.2d at1173. The Court also ruled that by amending the plan in 1993 to impose an SBA offset on the minimum benefits formulas retroactively and without notice, Defendants violated ERISA Sections 204(g) and the notice requirements contained in Section 204(h). Id. These claims are timely because Defendants never disclosed, much less repudiated, the violation of the minimum benefits provisions of

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the plan by application of an SBA offset. Nor did they ever disclose or repudiate their violation of ERISA sections 204(g) and 204(h) by secretly amending the plan to impose an SBA offset to the minimum benefits provisions.

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In the entirety of Defendants exhaustive briefing on the statue of limitations issues during the class certification proceedings, Defendants made no showing that Plaintiffs minimum benefits claims accrued prior to the final denial of the claims in October 2003. This is not surprising because Defendants only arguments in opposition to Plaintiffs motion for summary judgment on the minimum benefits issues, were that the Plan permitted them to apply an SBA offset to the minimum benefits formula and that the 1993 amendments were not amendments but mere clarifications that did not trigger ERISA Section 204(h) notice

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requirements nor reduce accrued benefits in violation of ERISA Section 204(g). (Doc. 21, pp. 24-29.) In order for the statute of limitations to be triggered, Defendants would have to show that they disclosed to Plaintiffs that the terms of the official Plan documents did not provide for an SBA offset and that they clearly made known their position that notwithstanding the absence of the SBA offset, Plaintiffs claims that the Plan was being violated were denied. Given Defendants posture in opposing summary judgment, it is not surprising that outside of the formal claims procedure denials, such evidence does not exist.

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As no notice or repudiation of the minimum benefits claims was ever provided, in so far as Defendants purport to assert a statute of limitations defense regarding the minimum benefits claims, this defense should be dismissed. C. The Statute of Limitations Does Not Bar the SBA Offset Claim
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The Court ruled that Defendants violated Section 204(g) of ERISA, 29 U.S.C. § 1054(g), by amending the plan to increase the interest rate used to calculate the SBA offset thereby reducing Plaintiffs pension benefits. At no time did Defendants ever disclose to

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class members that their benefits were reduced by an amendment to the Plan changing the projection interest rate used to calculated the SBA offset from date of termination until age 65 from the 3.5% Credited Interest rate required under the terms of the Garrett Plan to the 7.5% provided under the Signal Plan. Not only did Defendants fail to repudiate Plaintiffs SBA offset claim, they affirmatively denied the possibility of the existence of this claim. In 1995, in a wrap up of a presentation about the retirement plan to approximately 1,000 of the active employees

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working in the Phoenix area who attended one of four

town hall meetings, Defendants

provided a printout of slides to attendees which acknowledged that the SBA offset was both confusing and unchanged, as follows: Summary

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SBA is confusing Plan has not changed As always, if SBA withdrawn, Retirement Plan benefit will be reduced Evaluate your options carefully to make the most of these plans

(SOF ¶ 15, 16.)4 Given these admissions, Defendants cannot meet their heavy burden to establish that despite all of the confusion they somehow clearly repudiated Plaintiffs SBA The written narrative accompanying the town hall meeting slide presentations underscored the message that the plan had not changed: The bottom line is that the plan has not changed. (emphasis in original) (SOF ¶ 17.)
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offset claim. Defendants 1995 town hall meetings, if relevant at all, demonstrate that Defendants not only did not repudiate Plaintiffs SBA offset claim, they led Plaintiffs to believe that Defendants had made no changes to the SBA offset and thereby affirmatively

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disavowed the existence of any SBA offset claim. Having done so, they cannot establish (even as to this small number of employees), that this claim was somehow repudiated. Plaintiffs efforts to ascertain the interest rates and methodology used to calculate the SBA offset was an extremely difficult endeavor, even for experienced legal counsel. Upon obtaining and studying the Garrett plan documents, Class Counsel requested Defendants to provide a copy of Exhibit B on repeated occasions beginning in 2001. (SOF ¶ 7.)
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Without obtaining a copy of Exhibit B, it was not possible to confirm how benefits were to
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be calculated under the Garrett Retirement Plan as it existed in 1984. (SOF ¶ 6.) Claims cannot accrue or be considered to have been repudiated before Defendants disclose the basic terms of the Plans. It took Defendants over two years following class counsel s initial request for all relevant Plan documents to produce Exhibit B. (SOF ¶ 9.) At one point counsel for Defendants produced what was apparently a signed 1976 Plan document (before Amendment VI that amended the Plan to provide for Exhibit B), stating Although we cannot be certain,
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Exhibit B was added to the Garrett Plan by amendment VI dated December 1, 1981. (SOF ¶ 5.) Exhibit B is part of the Garrett Plan and necessary to compute the Normal Retirement Benefit, which is calculated utilizing both a participant s Potential Retirement Income from the Plan and the Participant s Actual Retirement Income from the Plan. (SOF ¶ 6.) Both Sections of the Garrett Plan refer to Exhibit B as necessary and direct that benefits shall be calculated pursuant to the tables set forth in Exhibit B (and any necessary interpolations or extrapolations from these tables)... (Id.)
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this suggests that Exhibit B does not exist and may never have existed. (SOF ¶ 8.) Given Defendants failure to produce the documents required to calculate benefits under the Garrett Plan, it is not plausible to assert that class members were or should have been on clear notice

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of the SBA offset claim. Although Defendants argued that class members should somehow have gleaned information giving rise to the SBA offset claim from documents Defendants submitted, those arguments are not credible. The fact is that Defendants could not even produce the official Garrett Plan documents needed to calculate benefits. To suggest that class members should somehow have been able to divine the existence of the SBA offset claim without access to the information required under the Garrett Plan is nonsensical. Further, information regarding

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how the SBA offset was supposed to be calculated under the Signal Plan was also required but not disclosed. On the class certification motion, Defendants went so far as to suggest that Plaintiffs claims should be deemed to arise from SPDs or other documents that allegedly had interest rates embedded in benefits illustrations. They also attempted to rely on complex formulas contained in lengthy benefit calculation worksheets that among other things were not written in a manner calculated to be understood by the average Plan participant and that employed actuarial abbreviations, footnotes and made reference to tables and exhibits that were not provided. Defendants attempts to eliminate the requirements for clear and continuous repudiation from the applicable legal standards should be rejected. The other documentary evidence submitted by Defendants is likewise unpersuasive and fails to repudiate Plaintiffs SBA offset claim. For example, a January 1984 brochure
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makes no reference whatsoever to the phantom growth of the SBA offset to age 65 if a participant leaves employment prior to that age. (SOF ¶ 18.) Likewise, before the year 2000, no summary plan descriptions disclosed what interest rates were used to calculate the SBA

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offset. Allen, 382 F.Supp.2d at 1170 n.17. However, absent proof that Defendants disclosed to Plaintiffs the interest projection rate under the Garrett Retirement Plan and that it had been changed, mere disclosure of the Signal Plan interest rate in the year 2000 was inadequate and could not have triggered the running of the statute of limitations.6 Defendants also unsuccessfully attempted to rely on benefit calculation worksheets given to participants. These worksheets are fundamentally unintelligible, confusing and incomplete. They range in length from 17-20 pages, require the reader to Look up Factors

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from Tables that were never been provided to participants and do not disclose the interest rates used to calculate the offsets or in some cases, even the actuarial factors used by the actuaries to do the pension benefit calculations. They also refer to tables and calculators not disclosed, rely on actuarial abbreviations and complex mathematical formulas. (See Doc. 206, Exh. F,G,N,T,U.) With respect to these worksheets, this Court already noted Plaintiffs argument that receipt of a benefit calculation worksheet could not constitute any sort of repudiation: In view of the complexity of the calculations showing the error by Defendants, it seems unreasonable to assume that Plaintiffs might have been
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Defendants have not provided any evidence regarding when and whether the 2000 SPD was distributed or to whom. Plaintiffs do not believe that Defendants distributed SPDs to retirees. In any event, even for the sake of argument, using the year 2000 as a triggering event, this claim was timely filed.
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able to figure out that they had claims and what they were by reviewing a complex thicket of obscure mathematical formulations, footnotes and calculations with cross references to nonexistent tables in the 17-20 page benefit calculation worksheets. (Doc. 226, Order on class certification, pp. 10-11.) Even if Plaintiffs somehow could have divined interest rates that may have been embedded in formulas that were used to calculate their SBA offsets from some worksheets which did contain actuarial factors (some but not all), they would have needed a scientific calculator and knowledge of complex actuarial interest rate principles in order to do so. Here again, mere knowledge of the interest rates used to calculate the SBA offsets under the Signal

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Plan would not have triggered the running of the statute of limitations. This is not a case challenging high interest rates per se. The rates are only relevant in relation to rates required by the Garrett Plan and those were not disclosed on the worksheets or anywhere else. It was certainly an option for Defendants to provide upon termination of employment or retirement, a summary of how each retiree s benefits were calculated written in language an average Plan participant could understand. Defendants did not to do so. The benefit calculations worksheets do not come even close to satisfying Defendants obligation to

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provide clear notice and unmistakable repudiation of the claims asserted by Plaintiffs. D. The Statute of Limitations Does Not Bar Plaintiffs Social Security Offset Claims With respect to the Social Security offset claims, although Defendants did disclose in summary plan descriptions that there would be a Social Security offset formula under the Signal Plan, Defendants never disclosed that the Social Security offset was going to be

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applied retroactively to benefits of Garrett employees attributable to service before adoption of the Social Security offset. As the Court found, the Garrett Plan promised your Social Security benefits are in addition to your pension benefits. Allen, 382 F.Supp.2d at 1155 n.

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11. The mere inclusion of the Social Security offset formula in an SPD, without disclosing that it would be applied retroactively in violation of the Garrett Plan promise could not suffice to constitute the kind of clear and unequivocal repudiation of Plaintiffs claim necessary to trigger the running of the statute of limitations. See, e.g., See, e.g., Chappel v. Laboratory Corp. of America, 232 F.3d 719, 727 (9th Cir. 2000) (plan administrator breached fiduciary duty by failing to notify plaintiff of procedures and time limits contained in SPD). There was no reason for Plaintiffs to read the SPD as a repudiation of the Garrett

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Plan s promises. The law did not impose on class members the obligation to anticipate that when they eventually retired, Defendants would violate the Garrett Plan promises and apply the Social Security offset retroactively. In the absence of clear notice that the offset would be applied retroactively despite the Garrett Plan promise that benefits would not be offset by Social Security, the statute of limitations could not begin to run. During the class certification proceedings, Defendants also attempted to argue that retired class members Social Security claims accrued at the time of their retirements based on the alleged provision of benefit calculation worksheets and argued that these claims were barred for participants who retired outside of the applicable limitations period. The same deficiencies regarding the benefit calculation worksheets preclude their use as a proxy for clear repudiation of the Social Security offset claims.
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They refer to tables and or

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calculators used to calculate the Social Security offset that were never provided to participants and were not even provided to Class Counsel, despite repeated requests, until more than two years into this litigation. (SOF ¶ 20.) Without these tables, it is impossible

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to determine how the Social Security offsets were calculated and it could not have been clear that offsets were applied retroactively. (SOF ¶ 19.) The complicated, unintelligible and incomplete information in the worksheets simply does not constitute an unmistakable repudiation of the Social Security offset claims. Even if the law were to impose on workers the obligations to decipher complex mathematical formulas or have their claims forever barred (an unlikely proposition), Plaintiffs could not have done so based on Defendants benefit calculations worksheets because the information contained in the worksheets was

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indecipherable and incomplete. E. Defendants Statute of Limitations Defense Must Be Dismissed Against the Named Plaintiffs In its order on Defendants motion for clarification, the Court ruled that Defendants had not waived their rights to take discovery on and assert affirmative defenses relating to individual putative class members claims, (Doc. 138, p. 14), but the Court did not rule as to

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whether Defendants could raise affirmative defenses against the named Plaintiffs despite their failure to prove them (or bring a Fed. R. Civ. P. 56(f) motion) prior to entry of summary judgment. (See Transcript of April 13, 2006 hearing, Doc. 155, pp. 42-44.) Defendants waived affirmative defenses against the named Plaintiffs by failing to prove them in opposition to the motion for summary judgment. Kontrick v. Ryan, 540 U.S.

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443, 458-60 (2004) (failure to argue that a claim was time barred in opposition to a motion for summary judgment precluded the assertion of that defense even though there was no dispute that the claim would have been time barred); Enlow v. Salem-Keizer Yellow Cab Co.,

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389 F.3d 802, 818-19 (9th Cir. 2004) (Since Yellow Cab did not specifically plead the BFOQ defense in its motion for summary judgment, Yellow Cab effectively waived this defense.); Scott v. Collins, 286 F.3d 923, 927-928 (6th Cir. 2002); Bank Leumi Le-Israel, B.M. v. Lee, 928 F.2d 232, 235 (7th Cir. 1991); Wholesale & Retail Food Distribution Local 63 v. Santa Fe Terminal Servs., 826 F.Supp. 326, 330 (C.D. Cal. 1993). Accordingly, with respect to the six named Plaintiffs, Defendants statute of limitations defenses were waived. CONCLUSION

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For the foregoing reasons, Plaintiffs respectfully request the Court to enter an order dismissing Defendants statute of limitations defense. Plaintiffs request such further relief as is equitable and just. Respectfully submitted this 10th day of December, 2007. MARTIN & BONNETT, P.L.L.C. By: s/Susan Martin Susan Martin Daniel L. Bonnett Jennifer L. Kroll 3300 North Central Avenue, Suite 1720 Phoenix, AZ 85012-2517 (602) 240-6900 Attorneys for Plaintiffs

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CERTIFICATE OF SERVICE I hereby certify that on December 10, 2007, I electronically transmitted the attached document to the Clerk s Office using the CM/ECF System for filing and transmittal of a Notice of Electronic Filing to the Following CM/ECF registrants: David B. Rosenbaum Dawn L. Dauphine Osborn Maledon, P.A. 2929 North Central Ave., Suite 2100 Phoenix, AZ 85012-2794 Michael Banks Azeez Hayne Morgan Lewis & Bockius LLP 1701 Market Street Philadelphia, PA 19103 Howard Shapiro Proskauer Rose LLP 909 Poydras Street, Suite 1100 New Orleans, LA 70112 Amy Covert Proskauer Rose LLP One Newark Center, 18th Floor Newark , NJ 07102-5211 Christopher Landau Eleanor R. Barrett Kirkland & Ellis LLP 655 Fifteenth Street, N.W. Washington, D.C. 20005 Attorneys for the Defendants s/.J. Kroll

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Case 2:04-cv-00424-ROS

Document 343

Filed 12/10/2007

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