KENT, District Judge.
Plaintiff brings this action pursuant to the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. ("ERISA"), challenging the Plan Administrator's denial of severance benefits. Now before the Court are Plaintiff's and Defendant's competing Motions for Summary Judgment. For the reasons articulated below, Defendant's Motion is hereby
Plaintiff Rick L. Giunta ("Giunta") began working for Mobil Corporation as an operations engineer on January 14, 1987.
On November 30, 1999, Exxon and Mobil merged into ExxonMobil Corporation ("ExxonMobil"), thereby fulfilling the "change in control" criteria set forth in the Plan. At the time of the merger, Giunta was working as a subsea engineer at Mobil's New Orleans facility. Immediately following the merger, ExxonMobil offered
After working at ExxonMobil's Houston facility for nearly five months, Giunta tendered a letter to ExxonMobil on July 19, 2000 stating that he wished to decline the relocation to Houston for personal reasons associated with the relocation of his family, and agreeing to work for ExxonMobil through July 31, 2000. Prior to tendering this letter, Giunta claims that he expressed his desire to return to ExxonMobil's New Orleans facility, but was not offered comparable employment at that location. During his exit interview, Giunta also indicated that his primary reason for declining the relocation to Houston was the "higher cost of living area without a significant increase in salary." ExxonMobil treated Giunta's July 19, 2000 letter as a letter of resignation, and informed Giunta during his exit interview that he was not eligible for severance benefits under the Plan. Following the termination of his employment with ExxonMobil, Giunta immediately commenced working at Halliburton Energy Services ("Halliburton"), a company also located in Houston. In fact, the record reveals that Halliburton offered Giunta a position on June 23, 2000, and Giunta accepted the position sometime between July 10-13, 2000, several days prior to declining the relocation with ExxonMobil.
Summary judgment is appropriate if no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. See Fed. R.Civ.P. 56(c); Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2552-53, 91 L.Ed.2d 265 (1986). When ruling on a motion for summary judgment, the evidence is viewed through "the prism of the substantive evidentiary burden." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 254, 106 S.Ct. 2505, 2513, 91 L.Ed.2d 202 (1986). Generally, "a denial of benefits challenged under [ERISA] is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary 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, 109 S.Ct. 948, 956-57, 103 L.Ed.2d 80 (1989) (emphasis added). If discretion is given in the plan either to determine eligibility or to construe its terms, the standard of review is the more lenient "abuse of discretion." See id. The Parties correctly assert in this case that the abuse of discretion standard applies because the Plan expressly grants discretionary authority to the Plan Administrator. The Court also notes that the decision of whether an abuse of discretion has occurred is based upon information known to the administrator at the time he made the decision. See Salley v. E.I. DuPont de Nemours & Co., 966 F.2d 1011, 1015 (5th Cir.1992).
In evaluating Plaintiff's claim, the Court remains mindful of the Fifth Circuit's recent admonition that if a conflict arises on the part of the plan administrator, deference to the discretionary standard should be adjusted depending upon the nature of the conflict. See Vega v. National Life Ins. Servs., Inc., 188 F.3d 287, 295 (5th Cir.1999) (en banc). Under this approach, the "court always applies the abuse of discretion standard, but gives less deference to the administrator in proportion to the administrator's apparent conflict." Id. at 296. Thus, "[t]he greater the evidence of conflict on the part of the administrator, the less deferential our abuse of discretion standard will be." Id. at 297. In the present case, Giunta contends that a conflict of interest exists because the Plan is unfunded, meaning that
Generally, application of the abuse of discretion standard is a two-step process. See Wildbur, 974 F.2d at 637. This procedure requires the Court first to determine the legally correct interpretation of the plan and then to examine whether the administrator applied the same. If the administrator failed to apply a legally correct interpretation of the plan, the Court then determines whether the administrator's actions constituted an abuse of discretion. See id. When determining the legally correct interpretation of the plan, the Court considers:
If the administrator has applied a legally correct interpretation of the plan, then no further inquiry is required. See, e.g., Chevron Chemical Co., 47 F.3d at 146; Haubold v. Intermedics, Inc., 11 F.3d 1333, 1341 (5th Cir.1994). However, if the Court finds that the administrator's interpretation is legally incorrect, then it must
If a benefits denial is supported by substantial evidence and is not erroneous as a matter of law, it is not arbitrary nor capricious, and therefore is not an abuse of discretion.
In the instant case, the Parties dispute the legally correct interpretation of the Plan with respect to the phrase "written consent" as used in Section 1.12.
Applying the three relevant factors of uniform construction, fair reading, and unanticipated costs, the Court concludes that Defendant's interpretation of "written consent" is legally correct. First, with regard to uniformity of construction, there is no evidence in the record that the Plan Administrator ever interpreted the phrase "written consent" to refer exclusively to the ABCD Form or any other type of written document. However, Giunta challenges the uniformity of the Plan Administrator's construction by raising two recent examples: Keith Carwile ("Carwile"), a former employee who received severance benefits under the Plan after being relocated to a facility more than fifty miles from his principal place of employment, and then declining relocation after working at the new facility for two months; and Stephen Pease ("Pease"), another former employee who was permitted to work at a new location more than fifty miles from his principal place of employment without waiving his entitlement to severance benefits. While the Court agrees that these examples may be illustrative of the fact that an employee's objective conduct cannot be construed as a per se acceptance of a relocation, they are not demonstrative of the very separate proposition that severance benefits can inure to an employee who has provided some form of written consent to a relocation. In the case of Carwile, for example, the employee was granted severance benefits after working at a new location for two months because he never provided any type of written consent to the relocation as required under Section 1.12. Thus, Carwile was allowed to decline the relocation pursuant to the ABCD Form, even though he had already commenced working at the new facility.
Next, the Court believes that the Plan Administrator's interpretation is consistent with a fair reading of the Plan. Initially, the Court observes that Section 1.12's "written consent" requirement appears to be an extra-ERISA contractual obligation that is rendered enforceable by contract law, rather than ERISA's statutory protections. See, e.g., Spacek v. Maritime Ass'n, 134 F.3d 283, 287 (5th Cir. 1998) (holding that "when an employer imposes upon itself extra-ERISA contractual obligations in its employee benefits plan, these extra-ERISA obligations are rendered enforceable by contract law"). In this case, Section 5.9 of the Plan specifically denotes that the Plan shall be construed and enforced according to the laws of the Commonwealth of Virginia, unless otherwise preempted by federal law. Whether analyzed under Virginia law or federal ERISA law, the result is identical. Under Virginia law, contract terms are to be given their usual, ordinary, and popular meaning. See D.C. McClain, Inc. v. Arlington County, 249 Va. 131, 452 S.E.2d 659, 662 (1995). Similarly, the Fifth Circuit has opined that ERISA provisions should be interpreted in an ordinary and popular sense as would a person of average intelligence and experience, or in the same manner as they are likely be understood by the average plan participant. See Tucker v. Shreveport Transit Mgmt., 226 F.3d 394, 398 (5th Cir.2000). Ascribed its ordinary and popular meaning, and viewed from the perspective of the average plan participant, the phrase "written consent" is most reasonably construed as any written document or communication expressing the employee's assent to or approval of the relocation. Because the Plan itself does not explicitly define or otherwise indicate the appropriate meaning attaching to the phrase "written consent," much less infer that the phrase "written consent" contemplates the ABCD Form in particular, it would be highly unreasonable to assume that the term "written consent" refers exclusively to the ABCD Form. Instead, the
Having stated that, however, the Court sympathizes with Giunta regarding the possibility that ExxonMobil violated its own internal policy of having all employees who accept or decline a position within two years following the merger to sign the ABCD Form. As both Parties acknowledge, the written consent requirement in Section 1.12 was crafted to ensure that employees were aware of the consequences of accepting or declining a position with the newly formed corporation. The ABCD Form, which clearly lays out the various consequences of accepting or declining a position, was ostensibly developed to facilitate this goal. The various e-mail communications between Leis and other staff members seem to indicate that ExxonMobil abided by a formal or informal policy of having employees sign the ABCD Form when accepting a position that would trigger benefits under the Plan if declined. Furthermore, it is clear from the record that Giunta's failure to sign the ABCD Form upon relocating to Houston was anomalous. The only other two employees who were allowed to relocate without signing the ABCD Form were Carwile and Pease, the former of whom eventually signed the ABCD Form, and the latter of whom provided written consent through an e-mail communication. In fact, Leis himself concedes in his second opinion letter that Giunta's failure to complete the ABCD Form "might indicate an inadvertent administrative error." Notwithstanding any administrative bungling that may be alleged to have led to the present lawsuit, however, the Court is confined solely to evaluating whether the Plan Administrator's interpretation of "written consent" is consistent with a fair reading of the Plan. Even assuming that Giunta was supposed to sign the ABCD Form pursuant to ExxonMobil's internal policy, this fact alone does not diminish the fairness or reasonableness of the Plan Administrator's interpretation. Giunta admits that employees were not privy to the internal policy, such that the average plan participant would not have associated the concept of "written consent" with the ABCD Form exclusively. Applying a plain and ordinary meaning to the phrase "written consent," and viewing Section 1.12 from the perspective of the average plan participant, the Court concludes that the Plan Administrator's interpretation is reasonably consistent with a fair reading of the Plan.
Finally, the Court considers whether any unanticipated costs would arise under competing interpretations of the Plan. Although the Parties do not provide substantial briefing on this issue, the Court surmises that neither interpretation is significantly likely to produce unanticipated costs. However, the Court admits that there exists some possibility, albeit slight, that Giunta's interpretation could result in unexpected costs to ExxonMobil, assuming that there are other employees in Giunta's identical situation who might seek to claim severance benefits under the Plan. Essentially, if the Court were to adopt Giunta's interpretation, then any ExxonMobil employee who consented to a relocation more than fifty miles from his principal place of employment through a written medium other than the ABCD Form will also be entitled to severance benefits under Section 1.12. However, because Giunta's case appears to be aberrant, given that the vast majority of other ExxonMobil employees appear to have signed the ABCD Form upon relocating, it is unlikely that any identical cases of this nature will arise in the future. As such, this third factor only minimally favors Defendant's interpretation of Section 1.12.
However, even if the Court were to find that the Plan Administrator applied a legally incorrect interpretation of the Plan, it would still validate the Plan Administrator's ultimate decision to deny benefits to Giunta under the applicable abuse of discretion standard. In short, the Court finds that the summary judgment evidence clearly shows that the Plan Administrator did not abuse his discretion in determining that Giunta provided written consent to the relocation to Houston. According to his Affidavit, the Plan Administrator reviewed the Plan documents as well as the information propounded by Giunta on appeal, and twice determined that Giunta had provided written consent to the relocation by filling out and submitting the ExxonMobil Relocation Authorization Form and various Relocation Expense Reports. These documents, considered in conjunction with other external evidence indicating that Giunta knew the relocation to Houston to be permanent,
For all of the foregoing reasons, the Court concludes that Plaintiff has failed to raise a genuine issue of material fact for trial. The Court accordingly hereby