HOGAN v. EASTERN ENTERPRISES/BOSTON GAS

NO. 2000-11729-RBC[fn1]

165 F. Supp.2d 55 (2001) | Cited 0 times | D. Massachusetts | September 27, 2001

MEMORANDUM AND ORDER ON DEFENDANT'S MOTION TO DISMISS #5

I. INTRODUCTION

In late August of 2000, plaintiff Wayne Hogan ("Hogan" or "plaintiff')instituted the instant action against defendant EasternEnterprises/Boston Gas ("Boston Gas" or "defendant"). The claims allegedin the four count complaint, violations of ERISA (Count I), common lawmisrepresentations (Count II), equitable estoppel (Count III) and breachof the implied covenant of good faith and fair dealing (Count IV)respectively, all relate to or arise out of Hogan's participation in aVoluntary Retirement Enhancement Plan offered by his employer.

In lieu of answering the complaint, Boston Gas filed a motion todismiss pursuant to Rule 12(b)(6), Fed. R. Civ. P., for failure tostate a claim upon which relief can be granted (#5) together with amemorandum in support (#6). In turn, the plaintiff has filed a memorandumin opposition to the dispositive motion. (#7) Following the submission ofthe defendant's reply brief (#9), oral argument was set for and heard onAugust 16, 2001. At this juncture, the motion to dismiss is in a posturefor resolution.

II. THE STANDARD

The Rule 12(b)(6) standard is quite familiar. In deciding thedefendant's motion to dismiss, the Court must "accept the complaint'sallegations as true, indulging all reasonable inferences in favor of [theplaintiff]." Kiely v. Raytheon Co., 105 F.3d 734, 735 (1 Cir., 1997).Indeed, when the sufficiency of a complaint is tested, it has long beenthe law that such "a complaint should not be dismissed for failure tostate a claim unless it appears beyond doubt that the plaintiff can proveno set of facts in support of [its] claim that would entitle [it] torelief." Conley v. Gibson, 355 U.S. 41, 45-6 (1957) (footnote omitted).At the same time, "bald assertions, . . . subjective characterizations,optimistic predictions, or problematic suppositions" need not becredited. United States v. AVX Corp., 962 F.2d 108, 115 (1 Cir., 1992)(internal quotations omitted).2

The defendant has appended two documents to its memorandum of law(#6), the Essex County Gas Company Voluntary Retirement Enhancement PlanJuly 1998 (Exh. A) ("the Plan") and the Essex County Gas Company SectionI Election Form and Release of Claims (Exh. B) ("the Release"), forreview by the Court in ruling on the dispositive motion. Although neitherof these documents is attached as an exhibit to the complaint, both arespecifically referenced in its text and are integral to the plaintiffsclaims. When deciding a motion to dismiss,

Ordinarily, of course, any consideration of documents not attached to the complaint, or not expressly incorporated therein, is forbidden, unless the proceeding is properly converted into one for summary judgment under Rule 56. See Fed.R.Civ.P. 12(b)(6). However, courts have made narrow exceptions for documents the authenticity of which are not disputed by the parties; for official public records; for documents central to plaintiffs' claim; or for documents sufficiently referred to in the complaint. See, e.g., Romani v. Shearson Lehman Hutton, 929 F.2d 875, 879 n. 3 (1st Cir. 1991) (considering offering documents submitted by defendants with motion to dismiss claim of securities fraud); Fudge v. Penthouse Int'l, Ltd., 840 F.2d 1012, 1014-15 (1st Cir.) (considering allegedly libelous article submitted by defendants with motion to dismiss), cert. denied, 488 U.S. 821, 109 S.Ct. 65, 102 L.Ed.2d 42 (1988); Mack v. South Bay Beer Distrib., Inc., 798 F.2d 1279, 1282 (9th Cir. 1986) ("[O]n a motion to dismiss a court may properly look beyond the complaint to matters of public record and doing so does not convert a Rule 12(b)(6) motion to one for summary judgment."); see also In re Wade, 969 F.2d 241, 249 & n. 12 (7th Cir. 1992).

Watterson v. Page, 987 F.2d 1, 3-4 (1 Cir., 1993).

The Plan and the Release fall within the narrow exception to the generalrule and thus may properly be considered in the context of this pendingRule 12(b)(6) motion.

III. THE FACTS

The place to begin is with an examination of the allegations of thecomplaint. Hogan is an individual who for more than forty years wasemployed by Essex County Gas Company. (Complaint #1 ¶ 4) In late19973 defendant Boston Gas made an offer to purchase Essex County GasCompany and, upon consummation of the deal in 1998, became that company'ssuccessor in interest. (#1 ¶¶ 5, 6) When announced, the offer topurchase engendered concern among the employees of Essex County GasCompany, including the plaintiff, who were apprehensive about their jobsecurity. (#1 ¶ 7)

At some point after the announcement of the sale was made to the EssexCounty Gas Company employees, it is alleged that Hogan

was specifically informed at a luncheon with James Keating, Vice President and Treasurer of Essex County Gas Co. and William Beaton of Human Resources and Customer Service at Essex County Gas Company that an Early Retirement Plan and Severance Package would be introduced to key long term managerial/exempt employees such as plaintiff . . . [and] that under the proposed plan, not yet finalized, he would be offered an additional five years added to both his age and service time and that the company would also pay his existing medical and dental coverage. In addition, his life insurance would drop from twice his annual salary to a flat $20,000.00 and his annual pension would be $20,300.00.

Complaint #1 ¶¶ 10-11.

According to the plaintiff, he inquired of Messrs. Hastings and Beatonwhether the Essex County Gas Company office in Haverhill where he workedwould remain open after the sale. (#1 ¶ 12) Their response was "thatit was doubtful that the Haverhill Office would remain open and that thedefendant did not have the financial resources to retain much (sic) ofthe Essex County Gas Co. workers." (#1 ¶ 13) Hogan also askedwhether there was going to be a Social Security supplement offered tocover the working years lost consequence an early retirement. (#1 ¶14) Mr. Hastings reportedly replied "that there would not be a SocialSecurity Supplement because there was a possibility that Boston Gas wouldhave to contribute to the Essex County Pension Fund to cover tenadditional early retirees." (#1 ¶ 15) Hogan was advised at thatluncheon that the proposal "was not an official offer." (#1 ¶ 16)

In July of 1998 the official voluntary early retirement offer whichincorporated substantially the same terms as had been previouslydiscussed was made to the plaintiff. (#1 ¶ 174) By its terms, inorder to be eligible to participate in the Plan Hogan had to be "amanagement/non-Union employee and not an executive officer of theCompany, and have attained age 55 or older and have at least 10 years ofservice and be actively employed as of July 1, 1998." (#6, Exh. A at 1)The benefit enhancements provided in the Plan were the addition of fiveyears to each of the employee's age and years of service. (#6, Exh. A at1) Health insurance coverage was to remain the same as what was thenoffered to Essex County Gas Company retirees, while the life insurancebenefit would decrease from two times an employee's salary to $20,000.00upon retirement.5 (#6, Exh. A at 3)

The Plan provided that eligible employees had until August 24, 1998 toelect to participate. (#6, Exh. A at 5) If an employee chose toparticipate, he or she would then have seven days within which to revokethat election. (#6, Exh. A at 5) Hogan contends that:

Relying on the representations that a Social Security Supplement was not being considered, that Boston Gas did not have the financial resources to provide same, that the Haverhill Essex County Gas office was to be closed, therefore leading to the conclusion that termination of his employment was likely, the plaintiff accepted the offer of an early retirement and signed a document entitled "Essex County Gas Company Voluntary Retirement Enhancement Plan" on August 28, 19986.

Complaint # 1 ¶ 18.

By signing the Release, Hogan acknowledged that he had had at leastforty-five days to consider the Plan and would thereafter have seven dayswithin which to renege his acceptance. (#6, Exh. B ¶¶ 1, 2)Moreover, in executing the Release the plaintiff

affirm [ed] that I had been given adequate time to consider its terms and the terms of the [Plan] and that I had been given an opportunity to have any and all questions with respect to them answered. I affirm further that I have carefully read and I fully understand the meaning and intent of this Election Form and Release of Claims and the [Plan] and that I freely and voluntarily assent to all of the terms and conditions contained in them and that no one has forced, pressured, coerced or threatened me in any way in my decision to enter into and be bound by them, nor has anyone made any promises to me which are not set forth herein to cause or induce me to sign this Election Form and Release of claims and I affirm that my doing so is my own free and voluntary act.

Defendant's Memorandum #6, Exh. B ¶ 3.

The terms of the Release recited that Essex County Gas Company hadcounseled Hogan to seek legal advice before agreeing to participate inthe Plan and that he had either done so, or had purposely chosen not todo so, before he accepted the Plan and executed the Release. (#6, Exh. B¶ 6) The plaintiff affirmed that the Plan and the Release representedthe entire agreement between himself and Essex County Gas Company,superceding prior written or oral understandings or agreements, if any.(#6, Exh. B ¶ 5) Lastly, in pertinent part, the Release provided

I release and discharge Essex County Gas Company, and Eastern Enterprises and their subsidiaries . . . . from any and all claims, debts, demands, causes of action, suits, damages and rights to monetary or equitable relief of whatever nature and whether known or unknown for anything occurring up to and including the date on which I sign this Election Form and Release of Claims. This Release includes, but is not limited to, all claims I have, I have ever had, or may now have, for or related in any way to my employment with the Company or to the termination of my employment by the Company, including, but not limited to, any and all claims: arising under state, federal or local law for age discrimination, including for age discrimination under the Age Discrimination in Employment Act; wrongful discharge; breach of contract, actual or implied; race, gender, disability, handicap, or any other form of employment discrimination; breach of implied or express promises; intentional or negligent infliction of emotional distress; and any other action arising in tort, contract or equity.

Defendant's Memorandum #6, Exh. B ¶ 4.

In his complaint Hogan alleges that he

was not in a position of equal bargaining power when presented with said document [the Plan and Release]; was feeling intimidated in light of his financial circumstances, age, education and experience; and under duress and misapprehension of the material facts as presented by agents of the defendants (sic), when he signed said document.

Complaint #1 ¶ 20.

The plaintiff asserts that union employees were later offered a SocialSecurity supplement,that the defendant's operating earnings increased and that the Haverhilloffice had remained open at least until the date of the filing of hiscomplaint. (#1 ¶¶ 21-23)

IV DISCUSSION

Boston Gas maintains that the Release which Hogan signed on August 24,1998 bars his claims such that the complaint should be dismissed.Specifically, according to the terms of the Release, the plaintiff agreedto "release and discharge Essex County Gas Company, and EasternEnterprises and their subsidiaries . . . from any and all claims . . .whether known or unknown for anything occurring up to and including thedate on which I sign this . . . Release . . . includ[ing] . . . allclaims I have, have ever had, or may now have, for or related in any waywith the Company or to the termination of my employment by the Company."(#6, Exh. B ¶ 4)

According to the First Circuit

it is well settled that federal common law applies both to interpret the provisions of an ERISA benefit plan and to resolve "[i]ssues of relinquishment of rights and waiver" when such side agreements affect the benefits provided by an ERISA plan, see Rodriguez-Abreu v. Chase Manhattan Bank, N.A., 986 F.2d 580, 585, 587 (1st Cir. 1993). See also Smart v. Gillette Co. Long-Term Disability Plan, 70 F.3d 173, 178 (1st Cir. 1995). . . The relevant federal substantive law includes "the `common-sense canons of contract interpretation'" derived from state law, see Rodriguez-Abreu, 986 F.2d at 585 (internal citations omitted), including the teaching that "contracts containing unambiguous language must be construed according to their plain and natural meaning," Smart, 70 F.3d at 178.

Morais v. Central Beverage Corp. Union Employees' Supplemental RetirementPlan, 167 F.3d 709, 711-2 (1 Cir., 1999); see also Smart v. GilletteCompany Long-Term Disability Plan, 70 F.3d 173, 178 (1 Cir., 1995).

The language of the Release in this case is unambiguous and plainlyapplies to the four claims alleged by Hogan in his complaint.

In comparable circumstances, the Court has explained that

Waiver and release are affirmative defenses on which the employer bears the burden. Fed.R.Civ.P. 8(c); see Long v. Sears Roebuck & Co., 105 F.3d 1529, 1543 (3d Cir. 1997). At a minimum, judicial review of such waivers and releases has been designed to ensure that they are "knowing and voluntary." Smart, 70 F.3d at 181. That analysis necessitates some focus on the rights being waived and the congressional intention to protect such rights. This court has endorsed a "totality of circumstances" approach to determining the validity of the waiver. Id. We have found helpful, but not exclusive, a set of six factors identified by the Second Circuit in Finz v. Schlesinger, 957 F.2d 78, 82 (2d Cir. 1992). [FN4]

FN4. The six factors are: (1) plaintiffs education and business sophistication; (2) the respective roles of employer and employee in determining the provisions of the waiver; (3) the clarity of the agreement; (4) the time plaintiff had to study the agreement; (5) whether plaintiff had independent advice, such as that of counsel; and (6) the consideration for the waiver. Smart, 70 F.3d at 181 n. 3.

Rivera-Flores v. Bristol-Myers SquibbCaribbean, 112 F.3d 9, 12 (1 Cir., 19977); see also Morais, 167 F.3dat 713.

The defendant posits that the Release in this case must be found to beknowing and voluntary when the pertinent factors are considered.

While Hogan's educational background cannot be gleaned from the face ofthe complaint, it is alleged that he had worked for Essex County GasCompany for about forty years and that in 1998 he was "amanagement/non-Union employee and not an executive officer of theCompany." (#6, Exh. A at 18) The Release was drafted by the EssexCounty Gas Company, but there is no allegation that the terms are somehow inequitable. See Morais, 167 F.3d at 7149 ("Although the documentwas prepared by the company, there is neither evidence about how itscontents were developed nor evidence suggesting that the terms wereunfair.") The text of the Plan is four pages in length, while the Releaseis three pages. Both are written in simple and clear prose. In the wordsof the First Circuit, "[t]he language is not challenging." Morais, 167 at713.

According to the terms of the Release Hogan had a minimum of forty-fivedays to consider the retirement offer, and then another seven days withinwhich to rescind his election to participate. This is an adequate periodwithin which to review the documentation. Smart, 70 F.3d at 18210.While it is unknown if the plaintiff in fact had the benefit of legaladvice in making his election, he was unequivocally advised "to consultwith an attorney" before executing the Release. (#6, Exh. B ¶ 6)Lastly, Hogan received valuable consideration, five years added to bothhis age and years of service for calculation of his retirement.benefits, in return for signing the Release.

Apart from these particular factors, the defendant also notes that theRelease contains language to the effect that Hogan had "carefully read"and completely understood "the meaning and intent" of the Plan andRelease and that he had "freely and voluntarily assent[ed] to the termsand conditions." (#6, Exh. B ¶ 3) These acknowledgments, too, areviewed as indicative of the Release having been signed knowingly andvoluntarily.

The allegations of the complaint raise the issue of duress which couldimplicate a finding that the plaintiff knowingly and voluntarilyrelinquished his rights. Boston Gas argues that even if the Release wasvoidable consequent to duress, Hogan has ratified the Release by hissubsequent conduct.

Upholding a dismissal by the district court, the First Circuit reiteratedthat:

In In re Boston Shipyard Corp., 886 F.2d 451 (1st Cir. 1989), we said:

It is well settled that "[a] contract or release, the execution of which is induced by duress, is voidable, not void, and the person claiming duress must act promptly to repudiate the contract or release or he will be deemed to have waived his right to do so."

Id. at 455 (quoting Di Rose v. PK Management Corp., 691 F.2d 628, 633-34(2d Cir. 1982)). Applying this principle, wefound that a party had ratified a release agreement by accepting paymentand waiting for over a year and one half before claiming that it wasduress-induced. Id. We recently reiterated the rule. See Vasapolli v.Rostoff, 39 F.3d 27, 35 n. 5 (1st Cir. 1994) ("A contract signed underduress is voidable, but not automatically void. By accepting the fundsand failing to seek a remedy based on duress within a reasonable periodof time . . ., the plaintiffs forfeited any entitlement to relief on thisbasis.") (citations omitted). See also Abbadessa v. Moore Business FormsInc., 987 F.2d 18, 22-24 (1st Cir. 1993) (finding ratification of anallegedly avoidable release under New Hampshire law). Other courtsagree. E.g., Sutter Home Winery, Inc. v. Vintage Selections, Ltd.,971 F.2d 401, 409 (9th Cir. 1992) (after accepting the benefits of anagreement for four years, party may no longer avoid the agreement basedon claimed duress); Grillet v. Sears, Roebuck & Co., 927 F.2d 217, 220(5th Cir. 1991) (retaining benefits of release for two years constitutesratification). Deren v. Digital Equipment Corp., 61 F.3d 1, 2-3 (1 Cir.,1995). Similarly, in another case the district court concluded that theplaintiffs had ratified their settlement agreements with their employer"by accepting the benefits of their respective bargains and by waiting,respectively, between eleven and thirty-four months to disavow theagreements because of the alleged duress." Dorn v. Astra USA,975 F. Supp. 388, 393 (D. Mass., 1997).

The reasoning of these-decisions is fully applicable to this case.Hogan's assertion of duress is unavailing on the facts as alleged. He hasretained the benefit of his bargain with the defendant. He waited almostexactly two years before he sought to avoid the Release. This was toolittle, too late. By his conduct, Hogan has ratified the Release, and, tothe extent he is claiming duress, his complaint must be dismissed.

Theoretically the same holds true with respect to any suggestion thatHogan was fraudulently induced to execute the Release in reliance uponmisinformation from the defendant.11 The First Circuit has recognizedthe theory of fraudulent inducement as part of the federal common lawapplicable to an ERISA case, albeit in the context of an affirmativedefense. See Nash v. Trustees of Boston University, 946 F.2d 960, 964-6(1 Cir., 1991). Fraud in the inducement, like duress, renders a contractvoidable, not void. Nash, 946 F.2d at 966-7; see also Restatement(Second) Contracts § 164(1) ("If a party's manifestation of assentis induced by either a fraudulent or a material misrepresentation by theother party upon which the recipient is justified in relying, thecontract is voidable by the recipient."). As previously stated, "[a]voidable contract can, of course, be ratified by subsequent conduct."American Airlines v. Cardoza-Rodriguez, 133 F.3d 111, 119-20 (1 Cir.,1998). On the facts of this case, however, there is no need to reach thequestion of whether the Release was voidable consequent to fraud in theinducement and thereafter ratified or affirmed by Hogan because thestatements were predictions by personnel at Essex County Gas Company asto future actions which might or might not be taken by Boston Gas afterthe acquisition, and as such, Hogan was not justified in relying uponthem.

The First Circuit has written that:

Recovery in an action for the tort of misrepresentation (sometimes referred to as fraud or deceit) requires a showing that the defendant made a false representation of a material fact with knowledge of its falsity for the purpose of inducting the plaintiff to act thereon, and that the plaintiff relied upon the representation as true and acted upon it to his damage. Metropolitan Life Ins. Co. v. Ditmore, 729 F.2d 1, 4 (1st Cir. 1984) (quoting Barrett Associates, Inc. v. Aronson, 346 Mass. 150, 152, 190 N.E.2d 867 (1963)) (citations omitted).

The district court found that Bond justifiably relied on Martin's statement that M.N., Inc. was in the immediate process of going public in releasing him from the guaranty; that M.N., Inc. was not in the immediate process of going public; and that, absent this statement, Bond would not have executed the release.

Martin first argues that his representations to Bond were not actionable because, rather than statements of existing fact, they were "statements of opinion, of conditions to exist in the future, or of matters promissory in nature . . ." Pepsi Cola Metropolitan Bottling Co. v. Pleasure Island, Inc., 345 F.2d 617, 622 (1st Cir. 1965) (quoting Yerid v. Mason, 341 Mass. 527, 530, 170 N.E.2d 718 (1960)). While we agree that statements properly so characterized are not actionable, because "their truth cannot literally be known at the time they are made," Liberty Leather Corp. v. Callum, 653 F.2d 694, 698 (1st Cir.1981), we conclude that Martin's statements do not fall into this category.12

Bond Leather Co., Inc. v. Q.T. Shoe Mfg. Co., Inc., 764 F.2d 928, 935-6(1 Cir., 1985); Damon v. Sun Company, Inc., 87 F.3d 1467, 1479-80 (1Cir., 1996); Millen Industries, Inc. v. Flexo-Accessories Co., Inc.,5 F. Supp.2d 72, 73-4 (D. Mass., 1998).

As alleged in the complaint, the statements upon which Hogan reliedwere "that it was doubtful that the Haverhill Office would remain andthat the defendant did not have the financial resources to retain much ofthe Essex County Gas Co. workers" and "that there would not be a SocialSecurity Supplement because there was a possibility that Boston Gas wouldhave to contribute to the Essex County Pension Fund to cover tenadditional retirees. (#1 ¶¶ 13, 15) These are statements by EssexCounty Gas Company officials as to what actions Boston Gas might take inthe future if or when Boston Gas consummated the deal to purchase EssexCounty Gas Company.13 Schott Motorcycle Supply, Inc. v. AmericanHonda Motor Company, 976 F.2d 58, 64-5 (1 Cir., 1992) ("The allegedmisrepresentations consisted only of opinions as to future events. Therewere no circumstances indicating that plaintiff could justifiably rely ontheseopinions as `facts.'") Considering the statements which were made,the persons who made them and the circumstances in which they were made,they cannot form the basis of a claim of fraud.

The statement that it was "doubtful" that the Haverhill office wouldremain open was simply not factually verifiable at the time such thatHogan could reasonably have relied upon it in executing the Release inthe first instance. See Elias Brothers, 831 F. Supp. at 925-7. The sameis true of the statement that Boston Gas ". . . did not have the financialresources to retain much of the Essex County Gas Co. workers." With theuse of the indefinite term "much," there is no way the Essex County GasCompany officials could verify the truth of that statement. Moreover, andperhaps more important for present purposes, there is no allegation in thecomplaint that this statement was fraudulent, i.e., that, in fact, at thetime, Boston Gas did have the financial resources to retain much of theEssex County Gas Company workers. The allegation that the operatingrevenues of Boston Gas increased after the acquisition does not amount toan allegation that this fact was known or knowable at the time of theacquisition.

Lastly, the statement that there would not be a Social Securitysupplement ". . . because there was a possibility that Boston Gas wouldhave to contribute to the Essex County Pension Fund to cover tenadditional retirees" is of the same nature. From the terms of thestatement itself, it was unknown whether Boston Gas would have to makethe contributions. Also, there is no allegation that the statement wasuntrue when made. The allegation that later some employees received aSocial Security supplement is not the equivalent of an allegation thatthe statement was false when made.

As a matter of law, plaintiff was not justified in relying on thesestatements. Accordingly, plaintiff has not alleged a prima facie claim offraudulent inducement and, consequently, cannot challenge the volition orknowledge with which he executed the Release on that grounds. See, e.g.,Bennett v. Coors Brewing Company, 189 F.3d 1221, 1229-31 (10 Cir., 1999).

Although the plaintiff does not directly refute the validity of thedefendant's arguments, he does raise several points in Opposition to themotion to dismiss, all of which can be addressed with dispatch. FirstHogan takes the position that the complaint cannot be dismissed becausehe did not tender back the consideration that he received prior to filingsuit. Boston Gas is seeking dismissal on the grounds of ratification, notHogan's failure to tender back the consideration.14 Having concludedthat the plaintiff has ratified the Release, there is no sound reason toreach the question of a tender back requirement. See, e.g., Deren, 61F.3d at 1 ("We express no view on whether ERISA plaintiffs must satisfythis "tender back" requirement. Instead, we affirm the court's dismissalon the ground that, by waiting so long to avoid the releases, plaintiffshave ratified them, thus waiving their claims.")

Title 29 U.S.C. § 1110 (a) reads, in pertinent part, that "anyprovision in an agreement or instrument which purports to relieve afiduciary from responsibility or liability for any responsibility,obligation, or duty under this part shall be void as against publicpolicy." The plaintiff asserts that the Release falls within the purviewof this statutory provision and thus isvoid as against public policy. This argument is unavailing. The FirstCircuit has recognized that

Courts have, in the employment law context, commonly upheld releases given in exchange for additional benefits. Such releases provide a means of voluntary resolution of potential and actual legal disputes, and mete out a type of industrial justice. Thus, releases of past claims have been honored under the laws prohibiting race and gender discrimination. Warnebold v. Union Pac. R.R., 963 F.2d 222, 223-24 (8th Cir. 1992); cf Alexander v. Gardner-Denver Co., 415 U.S. 36, 52, 94 S.Ct. 1011, 102 1-22, 39 L.Ed.2d 147 (1974). Such releases have also been honored under the ADEA, which prohibits age discrimination in employment, e.g., Pierce v. Atchison T. & S.F. Ry. Co., 110 F.3d 431 (7th Cir. 1997), as well as under ERISA, e.g., Smart v. Gillette Co. Long-Term Disability Plan, 70 F.3d 173, 181 (1st Cir. 1995); Rodriguez-Abreu v. Chase Manhattan Bank, NA., 986 F.2d 580, 587 (1st Cir. 1993).

Rivera-Flores, 112 F.3d at 11-2; see also Smart v. Gillette CompanyLong-Term Disability Plan, 887 F. Supp. 383, 385 (D. Mass.), aff'd,70 F.3d 173 (1 Cir., 1995) ("Both parties agree that the conditioning ofseverance benefits on an agreement to waive an ERISA claim is notprohibited by the statute.")

Equally fruitless is the contention that the plaintiffs claims cannot beforeclosed by a contractual release agreement and that the Release isunconstitutional because it deprives Hogan of his due process rights. TheFirst Circuit has written that

Appellant labors to convince us that the agreement she signed was invalid because it amounted to a waiver, and the waiver, in turn, was unenforceable under ERISA. We think that this formulation misconstrues the issue. As we see it, no waiver is in play here. * * * * * At any rate, even if we assume that we are dealing with an actual rather than an ersatz waiver, the waiver is permissible. Congress passed ERISA in part to protect the rights of employees who choose to participate in welfare benefit plans. See 29 U.S.C. § 1001; see also Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 113, 109 S.Ct. 948, 955-56, 103 L.Ed.2d 80 (1989). To achieve that end, the statute establishes a private right of action for employees who allege that a plan administrator wrongfully denied a claim for benefits due under the provisions of the plan. See 29 U.S.C. § 1132 (a). But Congress did not go so far as to prohibit an employee from waiving her right to participate in an employee welfare benefit plan. See Rodriguez-Abreu, 986 F.2d at 587; Finz v. Schlesinger, 957 F.2d 78, 81 (2d Cir.), cert. denied, 506 U.S. 822, 113 S.Ct. 72, 121 L.Ed.2d 38 (1992); Laniok v. Advisory Comm. of the Brainerd Mfg. Co. Pension Plan, 935 F.2d 1360, 1364-66 (2d Cir. 1991); Lumpkin v. Envirodyne Indus., Inc., 933 F.2d 449, 455 (7th Cir.), cert. denied, 502 U.S. 939, 112 S.Ct. 373, 116 L.Ed.2d 324 (1991); Leavitt v. Northwestern Bell Tel. Co., 921 F.2d 160, 161-62 (8th Cir. 1990).

Smart, 70 F.3d at 180-1; Rivera-Flores, 112 F.3d at 11-2.

To summarize, in exchange for enhanced retirement benefits, Hoganexecuted a Release pursuant to the terms of which he agreed not to sueBoston Gas. The Release is not void as contrary to public policy, nordoes it violate his constitutional rights by denying him access to thefederal courts.

V. ORDER

For all the reasons stated, it is ORDERED that Defendant's Motion ToDismiss (#5) be, and the same hereby is, ALLOWED. Judgment shall enter forBoston Gas.

2 As noted in a leading treatise:

Dismissal under Rule 12(b)(6) may also be appropriate when asuccessful affirmative defense or other bar to relief appears on the faceof the complaint, such as the absolute immunity of a defendant, claimpreclusion, or the statute of limitations.

Defenses that require a factual review to be established (as ordinarilyoccurs with qualified immunity, for example) should not support adismissal for failure to state a claim. If, however, the complaint itselfsets forth facts showing that qualified immunity applies, the court mayproperly dismiss the claim.

2 Moore's Federal Practice, § 12.34[4] [b] (Matthew Bender 3ded.) (footnotes omitted).

3 It is actually alleged in the complaint that the employees of EssexCounty Gas company were notified of the Boston Gas's offer to purchase onor about December 23, 1998. (#1 ¶ 6) (emphasis added) It is presumedthat the date should read 1997 since all the activity with respect to thePlan and the Release took place in July/August of 1998 and would not havepredated the original announcement. (#1 ¶¶ 17-19)

4 Hogan notes that in the official offer the amount of his annualpension was reduced to $19,600.00. (#1 ¶ 17).

5 A further reduction was made in the life insurance benefit at ageseventy.

6 The date of August 28, 1998 appears to be an error. As noted, thePlan mandates that an election to participate be made by August 24,1998, and the Release signed by Hogan is dated August 24, 1998. (See #6,Exh. A at 5-6, Exh. B at 3-4)

7 The Rivera-Flores case was decided on a motion for summaryjudgment.

8 Although the defendant states that Hogan "served as Manager of theEssex County Gas's Haverhill, Massachusetts office" (#6 at 6), thatinformation cannot be weighed as it is not contained within thecomplaint, Plan or Release.

9 The Morais case was decided on a motion for summary judgment.

10 The Smart case was decided on stipulated facts.

11 Such a contention, of course, directly contradicts the expresslanguage of the Release: ". . . nor has anyone made any promises to mewhich are not set forth herein to cause of induce me to sign thisElection Form and Release of Claims." (#6, Exh. B ¶ 3)

12 In the Bond Leather case, the statement was that M.N., Inc. "wasin the process of going public and immediately needed to be released fromthe guaranty." The First Circuit wrote: ". . . this representation canscarcely be characterized as a mere prediction of future conduct, nor asa statement whose truth could not be ascertained at the time it wasmade. The statement that M.N., Inc. was "in the process of going public'plainly purported to describe activity already under way. Likewise, thatM.N., Inc. required a release "immediately' suggested that there wereexigent circumstances, requiring swift action, which existed at the timethe statements were made." Bond Leather, 764 F.2d at 936. Thesestatements are in marked contrast to the statements upon which Hoganclaims he relied in the instant case. See discussion, infra.

13 Indeed, the plaintiff alleges that at the time these statementswere made he "was then told that this was not an official offer butsomething that Boston Gas was reviewing." (#1 ¶ 16)

14 Whether there is a requirement that consideration must be tenderedback as a condition precedent to bringing an ERISA action has yet to bedetermined in this Circuit.

1. With the parties' consent, on April 4, 2001, this case has beenreferred and reassigned to the undersigned for all purposes, includingtrial and the entry of judgment, pursuant to 28 U.S.C. § 636 (c).

MEMORANDUM AND ORDER ON DEFENDANT'S MOTION TO DISMISS #5

I. INTRODUCTION

In late August of 2000, plaintiff Wayne Hogan ("Hogan" or "plaintiff')instituted the instant action against defendant EasternEnterprises/Boston Gas ("Boston Gas" or "defendant"). The claims allegedin the four count complaint, violations of ERISA (Count I), common lawmisrepresentations (Count II), equitable estoppel (Count III) and breachof the implied covenant of good faith and fair dealing (Count IV)respectively, all relate to or arise out of Hogan's participation in aVoluntary Retirement Enhancement Plan offered by his employer.

In lieu of answering the complaint, Boston Gas filed a motion todismiss pursuant to Rule 12(b)(6), Fed. R. Civ. P., for failure tostate a claim upon which relief can be granted (#5) together with amemorandum in support (#6). In turn, the plaintiff has filed a memorandumin opposition to the dispositive motion. (#7) Following the submission ofthe defendant's reply brief (#9), oral argument was set for and heard onAugust 16, 2001. At this juncture, the motion to dismiss is in a posturefor resolution.

II. THE STANDARD

The Rule 12(b)(6) standard is quite familiar. In deciding thedefendant's motion to dismiss, the Court must "accept the complaint'sallegations as true, indulging all reasonable inferences in favor of [theplaintiff]." Kiely v. Raytheon Co., 105 F.3d 734, 735 (1 Cir., 1997).Indeed, when the sufficiency of a complaint is tested, it has long beenthe law that such "a complaint should not be dismissed for failure tostate a claim unless it appears beyond doubt that the plaintiff can proveno set of facts in support of [its] claim that would entitle [it] torelief." Conley v. Gibson, 355 U.S. 41, 45-6 (1957) (footnote omitted).At the same time, "bald assertions, . . . subjective characterizations,optimistic predictions, or problematic suppositions" need not becredited. United States v. AVX Corp., 962 F.2d 108, 115 (1 Cir., 1992)(internal quotations omitted).2

The defendant has appended two documents to its memorandum of law(#6), the Essex County Gas Company Voluntary Retirement Enhancement PlanJuly 1998 (Exh. A) ("the Plan") and the Essex County Gas Company SectionI Election Form and Release of Claims (Exh. B) ("the Release"), forreview by the Court in ruling on the dispositive motion. Although neitherof these documents is attached as an exhibit to the complaint, both arespecifically referenced in its text and are integral to the plaintiffsclaims. When deciding a motion to dismiss,

Ordinarily, of course, any consideration of documents not attached to the complaint, or not expressly incorporated therein, is forbidden, unless the proceeding is properly converted into one for summary judgment under Rule 56. See Fed.R.Civ.P. 12(b)(6). However, courts have made narrow exceptions for documents the authenticity of which are not disputed by the parties; for official public records; for documents central to plaintiffs' claim; or for documents sufficiently referred to in the complaint. See, e.g., Romani v. Shearson Lehman Hutton, 929 F.2d 875, 879 n. 3 (1st Cir. 1991) (considering offering documents submitted by defendants with motion to dismiss claim of securities fraud); Fudge v. Penthouse Int'l, Ltd., 840 F.2d 1012, 1014-15 (1st Cir.) (considering allegedly libelous article submitted by defendants with motion to dismiss), cert. denied, 488 U.S. 821, 109 S.Ct. 65, 102 L.Ed.2d 42 (1988); Mack v. South Bay Beer Distrib., Inc., 798 F.2d 1279, 1282 (9th Cir. 1986) ("[O]n a motion to dismiss a court may properly look beyond the complaint to matters of public record and doing so does not convert a Rule 12(b)(6) motion to one for summary judgment."); see also In re Wade, 969 F.2d 241, 249 & n. 12 (7th Cir. 1992).

Watterson v. Page, 987 F.2d 1, 3-4 (1 Cir., 1993).

The Plan and the Release fall within the narrow exception to the generalrule and thus may properly be considered in the context of this pendingRule 12(b)(6) motion.

III. THE FACTS

The place to begin is with an examination of the allegations of thecomplaint. Hogan is an individual who for more than forty years wasemployed by Essex County Gas Company. (Complaint #1 ¶ 4) In late19973 defendant Boston Gas made an offer to purchase Essex County GasCompany and, upon consummation of the deal in 1998, became that company'ssuccessor in interest. (#1 ¶¶ 5, 6) When announced, the offer topurchase engendered concern among the employees of Essex County GasCompany, including the plaintiff, who were apprehensive about their jobsecurity. (#1 ¶ 7)

At some point after the announcement of the sale was made to the EssexCounty Gas Company employees, it is alleged that Hogan

was specifically informed at a luncheon with James Keating, Vice President and Treasurer of Essex County Gas Co. and William Beaton of Human Resources and Customer Service at Essex County Gas Company that an Early Retirement Plan and Severance Package would be introduced to key long term managerial/exempt employees such as plaintiff . . . [and] that under the proposed plan, not yet finalized, he would be offered an additional five years added to both his age and service time and that the company would also pay his existing medical and dental coverage. In addition, his life insurance would drop from twice his annual salary to a flat $20,000.00 and his annual pension would be $20,300.00.

Complaint #1 ¶¶ 10-11.

According to the plaintiff, he inquired of Messrs. Hastings and Beatonwhether the Essex County Gas Company office in Haverhill where he workedwould remain open after the sale. (#1 ¶ 12) Their response was "thatit was doubtful that the Haverhill Office would remain open and that thedefendant did not have the financial resources to retain much (sic) ofthe Essex County Gas Co. workers." (#1 ¶ 13) Hogan also askedwhether there was going to be a Social Security supplement offered tocover the working years lost consequence an early retirement. (#1 ¶14) Mr. Hastings reportedly replied "that there would not be a SocialSecurity Supplement because there was a possibility that Boston Gas wouldhave to contribute to the Essex County Pension Fund to cover tenadditional early retirees." (#1 ¶ 15) Hogan was advised at thatluncheon that the proposal "was not an official offer." (#1 ¶ 16)

In July of 1998 the official voluntary early retirement offer whichincorporated substantially the same terms as had been previouslydiscussed was made to the plaintiff. (#1 ¶ 174) By its terms, inorder to be eligible to participate in the Plan Hogan had to be "amanagement/non-Union employee and not an executive officer of theCompany, and have attained age 55 or older and have at least 10 years ofservice and be actively employed as of July 1, 1998." (#6, Exh. A at 1)The benefit enhancements provided in the Plan were the addition of fiveyears to each of the employee's age and years of service. (#6, Exh. A at1) Health insurance coverage was to remain the same as what was thenoffered to Essex County Gas Company retirees, while the life insurancebenefit would decrease from two times an employee's salary to $20,000.00upon retirement.5 (#6, Exh. A at 3)

The Plan provided that eligible employees had until August 24, 1998 toelect to participate. (#6, Exh. A at 5) If an employee chose toparticipate, he or she would then have seven days within which to revokethat election. (#6, Exh. A at 5) Hogan contends that:

Relying on the representations that a Social Security Supplement was not being considered, that Boston Gas did not have the financial resources to provide same, that the Haverhill Essex County Gas office was to be closed, therefore leading to the conclusion that termination of his employment was likely, the plaintiff accepted the offer of an early retirement and signed a document entitled "Essex County Gas Company Voluntary Retirement Enhancement Plan" on August 28, 19986.

Complaint # 1 ¶ 18.

By signing the Release, Hogan acknowledged that he had had at leastforty-five days to consider the Plan and would thereafter have seven dayswithin which to renege his acceptance. (#6, Exh. B ¶¶ 1, 2)Moreover, in executing the Release the plaintiff

affirm [ed] that I had been given adequate time to consider its terms and the terms of the [Plan] and that I had been given an opportunity to have any and all questions with respect to them answered. I affirm further that I have carefully read and I fully understand the meaning and intent of this Election Form and Release of Claims and the [Plan] and that I freely and voluntarily assent to all of the terms and conditions contained in them and that no one has forced, pressured, coerced or threatened me in any way in my decision to enter into and be bound by them, nor has anyone made any promises to me which are not set forth herein to cause or induce me to sign this Election Form and Release of claims and I affirm that my doing so is my own free and voluntary act.

Defendant's Memorandum #6, Exh. B ¶ 3.

The terms of the Release recited that Essex County Gas Company hadcounseled Hogan to seek legal advice before agreeing to participate inthe Plan and that he had either done so, or had purposely chosen not todo so, before he accepted the Plan and executed the Release. (#6, Exh. B¶ 6) The plaintiff affirmed that the Plan and the Release representedthe entire agreement between himself and Essex County Gas Company,superceding prior written or oral understandings or agreements, if any.(#6, Exh. B ¶ 5) Lastly, in pertinent part, the Release provided

I release and discharge Essex County Gas Company, and Eastern Enterprises and their subsidiaries . . . . from any and all claims, debts, demands, causes of action, suits, damages and rights to monetary or equitable relief of whatever nature and whether known or unknown for anything occurring up to and including the date on which I sign this Election Form and Release of Claims. This Release includes, but is not limited to, all claims I have, I have ever had, or may now have, for or related in any way to my employment with the Company or to the termination of my employment by the Company, including, but not limited to, any and all claims: arising under state, federal or local law for age discrimination, including for age discrimination under the Age Discrimination in Employment Act; wrongful discharge; breach of contract, actual or implied; race, gender, disability, handicap, or any other form of employment discrimination; breach of implied or express promises; intentional or negligent infliction of emotional distress; and any other action arising in tort, contract or equity.

Defendant's Memorandum #6, Exh. B ¶ 4.

In his complaint Hogan alleges that he

was not in a position of equal bargaining power when presented with said document [the Plan and Release]; was feeling intimidated in light of his financial circumstances, age, education and experience; and under duress and misapprehension of the material facts as presented by agents of the defendants (sic), when he signed said document.

Complaint #1 ¶ 20.

The plaintiff asserts that union employees were later offered a SocialSecurity supplement,that the defendant's operating earnings increased and that the Haverhilloffice had remained open at least until the date of the filing of hiscomplaint. (#1 ¶¶ 21-23)

IV DISCUSSION

Boston Gas maintains that the Release which Hogan signed on August 24,1998 bars his claims such that the complaint should be dismissed.Specifically, according to the terms of the Release, the plaintiff agreedto "release and discharge Essex County Gas Company, and EasternEnterprises and their subsidiaries . . . from any and all claims . . .whether known or unknown for anything occurring up to and including thedate on which I sign this . . . Release . . . includ[ing] . . . allclaims I have, have ever had, or may now have, for or related in any waywith the Company or to the termination of my employment by the Company."(#6, Exh. B ¶ 4)

According to the First Circuit

it is well settled that federal common law applies both to interpret the provisions of an ERISA benefit plan and to resolve "[i]ssues of relinquishment of rights and waiver" when such side agreements affect the benefits provided by an ERISA plan, see Rodriguez-Abreu v. Chase Manhattan Bank, N.A., 986 F.2d 580, 585, 587 (1st Cir. 1993). See also Smart v. Gillette Co. Long-Term Disability Plan, 70 F.3d 173, 178 (1st Cir. 1995). . . The relevant federal substantive law includes "the `common-sense canons of contract interpretation'" derived from state law, see Rodriguez-Abreu, 986 F.2d at 585 (internal citations omitted), including the teaching that "contracts containing unambiguous language must be construed according to their plain and natural meaning," Smart, 70 F.3d at 178.

Morais v. Central Beverage Corp. Union Employees' Supplemental RetirementPlan, 167 F.3d 709, 711-2 (1 Cir., 1999); see also Smart v. GilletteCompany Long-Term Disability Plan, 70 F.3d 173, 178 (1 Cir., 1995).

The language of the Release in this case is unambiguous and plainlyapplies to the four claims alleged by Hogan in his complaint.

In comparable circumstances, the Court has explained that

Waiver and release are affirmative defenses on which the employer bears the burden. Fed.R.Civ.P. 8(c); see Long v. Sears Roebuck & Co., 105 F.3d 1529, 1543 (3d Cir. 1997). At a minimum, judicial review of such waivers and releases has been designed to ensure that they are "knowing and voluntary." Smart, 70 F.3d at 181. That analysis necessitates some focus on the rights being waived and the congressional intention to protect such rights. This court has endorsed a "totality of circumstances" approach to determining the validity of the waiver. Id. We have found helpful, but not exclusive, a set of six factors identified by the Second Circuit in Finz v. Schlesinger, 957 F.2d 78, 82 (2d Cir. 1992). [FN4]

FN4. The six factors are: (1) plaintiffs education and business sophistication; (2) the respective roles of employer and employee in determining the provisions of the waiver; (3) the clarity of the agreement; (4) the time plaintiff had to study the agreement; (5) whether plaintiff had independent advice, such as that of counsel; and (6) the consideration for the waiver. Smart, 70 F.3d at 181 n. 3.

Rivera-Flores v. Bristol-Myers SquibbCaribbean, 112 F.3d 9, 12 (1 Cir., 19977); see also Morais, 167 F.3dat 713.

The defendant posits that the Release in this case must be found to beknowing and voluntary when the pertinent factors are considered.

While Hogan's educational background cannot be gleaned from the face ofthe complaint, it is alleged that he had worked for Essex County GasCompany for about forty years and that in 1998 he was "amanagement/non-Union employee and not an executive officer of theCompany." (#6, Exh. A at 18) The Release was drafted by the EssexCounty Gas Company, but there is no allegation that the terms are somehow inequitable. See Morais, 167 F.3d at 7149 ("Although the documentwas prepared by the company, there is neither evidence about how itscontents were developed nor evidence suggesting that the terms wereunfair.") The text of the Plan is four pages in length, while the Releaseis three pages. Both are written in simple and clear prose. In the wordsof the First Circuit, "[t]he language is not challenging." Morais, 167 at713.

According to the terms of the Release Hogan had a minimum of forty-fivedays to consider the retirement offer, and then another seven days withinwhich to rescind his election to participate. This is an adequate periodwithin which to review the documentation. Smart, 70 F.3d at 18210.While it is unknown if the plaintiff in fact had the benefit of legaladvice in making his election, he was unequivocally advised "to consultwith an attorney" before executing the Release. (#6, Exh. B ¶ 6)Lastly, Hogan received valuable consideration, five years added to bothhis age and years of service for calculation of his retirement.benefits, in return for signing the Release.

Apart from these particular factors, the defendant also notes that theRelease contains language to the effect that Hogan had "carefully read"and completely understood "the meaning and intent" of the Plan andRelease and that he had "freely and voluntarily assent[ed] to the termsand conditions." (#6, Exh. B ¶ 3) These acknowledgments, too, areviewed as indicative of the Release having been signed knowingly andvoluntarily.

The allegations of the complaint raise the issue of duress which couldimplicate a finding that the plaintiff knowingly and voluntarilyrelinquished his rights. Boston Gas argues that even if the Release wasvoidable consequent to duress, Hogan has ratified the Release by hissubsequent conduct.

Upholding a dismissal by the district court, the First Circuit reiteratedthat:

In In re Boston Shipyard Corp., 886 F.2d 451 (1st Cir. 1989), we said:

It is well settled that "[a] contract or release, the execution of which is induced by duress, is voidable, not void, and the person claiming duress must act promptly to repudiate the contract or release or he will be deemed to have waived his right to do so."

Id. at 455 (quoting Di Rose v. PK Management Corp., 691 F.2d 628, 633-34(2d Cir. 1982)). Applying this principle, wefound that a party had ratified a release agreement by accepting paymentand waiting for over a year and one half before claiming that it wasduress-induced. Id. We recently reiterated the rule. See Vasapolli v.Rostoff, 39 F.3d 27, 35 n. 5 (1st Cir. 1994) ("A contract signed underduress is voidable, but not automatically void. By accepting the fundsand failing to seek a remedy based on duress within a reasonable periodof time . . ., the plaintiffs forfeited any entitlement to relief on thisbasis.") (citations omitted). See also Abbadessa v. Moore Business FormsInc., 987 F.2d 18, 22-24 (1st Cir. 1993) (finding ratification of anallegedly avoidable release under New Hampshire law). Other courtsagree. E.g., Sutter Home Winery, Inc. v. Vintage Selections, Ltd.,971 F.2d 401, 409 (9th Cir. 1992) (after accepting the benefits of anagreement for four years, party may no longer avoid the agreement basedon claimed duress); Grillet v. Sears, Roebuck & Co., 927 F.2d 217, 220(5th Cir. 1991) (retaining benefits of release for two years constitutesratification). Deren v. Digital Equipment Corp., 61 F.3d 1, 2-3 (1 Cir.,1995). Similarly, in another case the district court concluded that theplaintiffs had ratified their settlement agreements with their employer"by accepting the benefits of their respective bargains and by waiting,respectively, between eleven and thirty-four months to disavow theagreements because of the alleged duress." Dorn v. Astra USA,975 F. Supp. 388, 393 (D. Mass., 1997).

The reasoning of these-decisions is fully applicable to this case.Hogan's assertion of duress is unavailing on the facts as alleged. He hasretained the benefit of his bargain with the defendant. He waited almostexactly two years before he sought to avoid the Release. This was toolittle, too late. By his conduct, Hogan has ratified the Release, and, tothe extent he is claiming duress, his complaint must be dismissed.

Theoretically the same holds true with respect to any suggestion thatHogan was fraudulently induced to execute the Release in reliance uponmisinformation from the defendant.11 The First Circuit has recognizedthe theory of fraudulent inducement as part of the federal common lawapplicable to an ERISA case, albeit in the context of an affirmativedefense. See Nash v. Trustees of Boston University, 946 F.2d 960, 964-6(1 Cir., 1991). Fraud in the inducement, like duress, renders a contractvoidable, not void. Nash, 946 F.2d at 966-7; see also Restatement(Second) Contracts § 164(1) ("If a party's manifestation of assentis induced by either a fraudulent or a material misrepresentation by theother party upon which the recipient is justified in relying, thecontract is voidable by the recipient."). As previously stated, "[a]voidable contract can, of course, be ratified by subsequent conduct."American Airlines v. Cardoza-Rodriguez, 133 F.3d 111, 119-20 (1 Cir.,1998). On the facts of this case, however, there is no need to reach thequestion of whether the Release was voidable consequent to fraud in theinducement and thereafter ratified or affirmed by Hogan because thestatements were predictions by personnel at Essex County Gas Company asto future actions which might or might not be taken by Boston Gas afterthe acquisition, and as such, Hogan was not justified in relying uponthem.

The First Circuit has written that:

Recovery in an action for the tort of misrepresentation (sometimes referred to as fraud or deceit) requires a showing that the defendant made a false representation of a material fact with knowledge of its falsity for the purpose of inducting the plaintiff to act thereon, and that the plaintiff relied upon the representation as true and acted upon it to his damage. Metropolitan Life Ins. Co. v. Ditmore, 729 F.2d 1, 4 (1st Cir. 1984) (quoting Barrett Associates, Inc. v. Aronson, 346 Mass. 150, 152, 190 N.E.2d 867 (1963)) (citations omitted).

The district court found that Bond justifiably relied on Martin's statement that M.N., Inc. was in the immediate process of going public in releasing him from the guaranty; that M.N., Inc. was not in the immediate process of going public; and that, absent this statement, Bond would not have executed the release.

Martin first argues that his representations to Bond were not actionable because, rather than statements of existing fact, they were "statements of opinion, of conditions to exist in the future, or of matters promissory in nature . . ." Pepsi Cola Metropolitan Bottling Co. v. Pleasure Island, Inc., 345 F.2d 617, 622 (1st Cir. 1965) (quoting Yerid v. Mason, 341 Mass. 527, 530, 170 N.E.2d 718 (1960)). While we agree that statements properly so characterized are not actionable, because "their truth cannot literally be known at the time they are made," Liberty Leather Corp. v. Callum, 653 F.2d 694, 698 (1st Cir.1981), we conclude that Martin's statements do not fall into this category.12

Bond Leather Co., Inc. v. Q.T. Shoe Mfg. Co., Inc., 764 F.2d 928, 935-6(1 Cir., 1985); Damon v. Sun Company, Inc., 87 F.3d 1467, 1479-80 (1Cir., 1996); Millen Industries, Inc. v. Flexo-Accessories Co., Inc.,5 F. Supp.2d 72, 73-4 (D. Mass., 1998).

As alleged in the complaint, the statements upon which Hogan reliedwere "that it was doubtful that the Haverhill Office would remain andthat the defendant did not have the financial resources to retain much ofthe Essex County Gas Co. workers" and "that there would not be a SocialSecurity Supplement because there was a possibility that Boston Gas wouldhave to contribute to the Essex County Pension Fund to cover tenadditional retirees. (#1 ¶¶ 13, 15) These are statements by EssexCounty Gas Company officials as to what actions Boston Gas might take inthe future if or when Boston Gas consummated the deal to purchase EssexCounty Gas Company.13 Schott Motorcycle Supply, Inc. v. AmericanHonda Motor Company, 976 F.2d 58, 64-5 (1 Cir., 1992) ("The allegedmisrepresentations consisted only of opinions as to future events. Therewere no circumstances indicating that plaintiff could justifiably rely ontheseopinions as `facts.'") Considering the statements which were made,the persons who made them and the circumstances in which they were made,they cannot form the basis of a claim of fraud.

The statement that it was "doubtful" that the Haverhill office wouldremain open was simply not factually verifiable at the time such thatHogan could reasonably have relied upon it in executing the Release inthe first instance. See Elias Brothers, 831 F. Supp. at 925-7. The sameis true of the statement that Boston Gas ". . . did not have the financialresources to retain much of the Essex County Gas Co. workers." With theuse of the indefinite term "much," there is no way the Essex County GasCompany officials could verify the truth of that statement. Moreover, andperhaps more important for present purposes, there is no allegation in thecomplaint that this statement was fraudulent, i.e., that, in fact, at thetime, Boston Gas did have the financial resources to retain much of theEssex County Gas Company workers. The allegation that the operatingrevenues of Boston Gas increased after the acquisition does not amount toan allegation that this fact was known or knowable at the time of theacquisition.

Lastly, the statement that there would not be a Social Securitysupplement ". . . because there was a possibility that Boston Gas wouldhave to contribute to the Essex County Pension Fund to cover tenadditional retirees" is of the same nature. From the terms of thestatement itself, it was unknown whether Boston Gas would have to makethe contributions. Also, there is no allegation that the statement wasuntrue when made. The allegation that later some employees received aSocial Security supplement is not the equivalent of an allegation thatthe statement was false when made.

As a matter of law, plaintiff was not justified in relying on thesestatements. Accordingly, plaintiff has not alleged a prima facie claim offraudulent inducement and, consequently, cannot challenge the volition orknowledge with which he executed the Release on that grounds. See, e.g.,Bennett v. Coors Brewing Company, 189 F.3d 1221, 1229-31 (10 Cir., 1999).

Although the plaintiff does not directly refute the validity of thedefendant's arguments, he does raise several points in Opposition to themotion to dismiss, all of which can be addressed with dispatch. FirstHogan takes the position that the complaint cannot be dismissed becausehe did not tender back the consideration that he received prior to filingsuit. Boston Gas is seeking dismissal on the grounds of ratification, notHogan's failure to tender back the consideration.14 Having concludedthat the plaintiff has ratified the Release, there is no sound reason toreach the question of a tender back requirement. See, e.g., Deren, 61F.3d at 1 ("We express no view on whether ERISA plaintiffs must satisfythis "tender back" requirement. Instead, we affirm the court's dismissalon the ground that, by waiting so long to avoid the releases, plaintiffshave ratified them, thus waiving their claims.")

Title 29 U.S.C. § 1110 (a) reads, in pertinent part, that "anyprovision in an agreement or instrument which purports to relieve afiduciary from responsibility or liability for any responsibility,obligation, or duty under this part shall be void as against publicpolicy." The plaintiff asserts that the Release falls within the purviewof this statutory provision and thus isvoid as against public policy. This argument is unavailing. The FirstCircuit has recognized that

Courts have, in the employment law context, commonly upheld releases given in exchange for additional benefits. Such releases provide a means of voluntary resolution of potential and actual legal disputes, and mete out a type of industrial justice. Thus, releases of past claims have been honored under the laws prohibiting race and gender discrimination. Warnebold v. Union Pac. R.R., 963 F.2d 222, 223-24 (8th Cir. 1992); cf Alexander v. Gardner-Denver Co., 415 U.S. 36, 52, 94 S.Ct. 1011, 102 1-22, 39 L.Ed.2d 147 (1974). Such releases have also been honored under the ADEA, which prohibits age discrimination in employment, e.g., Pierce v. Atchison T. & S.F. Ry. Co., 110 F.3d 431 (7th Cir. 1997), as well as under ERISA, e.g., Smart v. Gillette Co. Long-Term Disability Plan, 70 F.3d 173, 181 (1st Cir. 1995); Rodriguez-Abreu v. Chase Manhattan Bank, NA., 986 F.2d 580, 587 (1st Cir. 1993).

Rivera-Flores, 112 F.3d at 11-2; see also Smart v. Gillette CompanyLong-Term Disability Plan, 887 F. Supp. 383, 385 (D. Mass.), aff'd,70 F.3d 173 (1 Cir., 1995) ("Both parties agree that the conditioning ofseverance benefits on an agreement to waive an ERISA claim is notprohibited by the statute.")

Equally fruitless is the contention that the plaintiffs claims cannot beforeclosed by a contractual release agreement and that the Release isunconstitutional because it deprives Hogan of his due process rights. TheFirst Circuit has written that

Appellant labors to convince us that the agreement she signed was invalid because it amounted to a waiver, and the waiver, in turn, was unenforceable under ERISA. We think that this formulation misconstrues the issue. As we see it, no waiver is in play here. * * * * * At any rate, even if we assume that we are dealing with an actual rather than an ersatz waiver, the waiver is permissible. Congress passed ERISA in part to protect the rights of employees who choose to participate in welfare benefit plans. See 29 U.S.C. § 1001; see also Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 113, 109 S.Ct. 948, 955-56, 103 L.Ed.2d 80 (1989). To achieve that end, the statute establishes a private right of action for employees who allege that a plan administrator wrongfully denied a claim for benefits due under the provisions of the plan. See 29 U.S.C. § 1132 (a). But Congress did not go so far as to prohibit an employee from waiving her right to participate in an employee welfare benefit plan. See Rodriguez-Abreu, 986 F.2d at 587; Finz v. Schlesinger, 957 F.2d 78, 81 (2d Cir.), cert. denied, 506 U.S. 822, 113 S.Ct. 72, 121 L.Ed.2d 38 (1992); Laniok v. Advisory Comm. of the Brainerd Mfg. Co. Pension Plan, 935 F.2d 1360, 1364-66 (2d Cir. 1991); Lumpkin v. Envirodyne Indus., Inc., 933 F.2d 449, 455 (7th Cir.), cert. denied, 502 U.S. 939, 112 S.Ct. 373, 116 L.Ed.2d 324 (1991); Leavitt v. Northwestern Bell Tel. Co., 921 F.2d 160, 161-62 (8th Cir. 1990).

Smart, 70 F.3d at 180-1; Rivera-Flores, 112 F.3d at 11-2.

To summarize, in exchange for enhanced retirement benefits, Hoganexecuted a Release pursuant to the terms of which he agreed not to sueBoston Gas. The Release is not void as contrary to public policy, nordoes it violate his constitutional rights by denying him access to thefederal courts.

V. ORDER

For all the reasons stated, it is ORDERED that Defendant's Motion ToDismiss (#5) be, and the same hereby is, ALLOWED. Judgment shall enter forBoston Gas.

2 As noted in a leading treatise:

Dismissal under Rule 12(b)(6) may also be appropriate when asuccessful affirmative defense or other bar to relief appears on the faceof the complaint, such as the absolute immunity of a defendant, claimpreclusion, or the statute of limitations.

Defenses that require a factual review to be established (as ordinarilyoccurs with qualified immunity, for example) should not support adismissal for failure to state a claim. If, however, the complaint itselfsets forth facts showing that qualified immunity applies, the court mayproperly dismiss the claim.

2 Moore's Federal Practice, § 12.34[4] [b] (Matthew Bender 3ded.) (footnotes omitted).

3 It is actually alleged in the complaint that the employees of EssexCounty Gas company were notified of the Boston Gas's offer to purchase onor about December 23, 1998. (#1 ¶ 6) (emphasis added) It is presumedthat the date should read 1997 since all the activity with respect to thePlan and the Release took place in July/August of 1998 and would not havepredated the original announcement. (#1 ¶¶ 17-19)

4 Hogan notes that in the official offer the amount of his annualpension was reduced to $19,600.00. (#1 ¶ 17).

5 A further reduction was made in the life insurance benefit at ageseventy.

6 The date of August 28, 1998 appears to be an error. As noted, thePlan mandates that an election to participate be made by August 24,1998, and the Release signed by Hogan is dated August 24, 1998. (See #6,Exh. A at 5-6, Exh. B at 3-4)

7 The Rivera-Flores case was decided on a motion for summaryjudgment.

8 Although the defendant states that Hogan "served as Manager of theEssex County Gas's Haverhill, Massachusetts office" (#6 at 6), thatinformation cannot be weighed as it is not contained within thecomplaint, Plan or Release.

9 The Morais case was decided on a motion for summary judgment.

10 The Smart case was decided on stipulated facts.

11 Such a contention, of course, directly contradicts the expresslanguage of the Release: ". . . nor has anyone made any promises to mewhich are not set forth herein to cause of induce me to sign thisElection Form and Release of Claims." (#6, Exh. B ¶ 3)

12 In the Bond Leather case, the statement was that M.N., Inc. "wasin the process of going public and immediately needed to be released fromthe guaranty." The First Circuit wrote: ". . . this representation canscarcely be characterized as a mere prediction of future conduct, nor asa statement whose truth could not be ascertained at the time it wasmade. The statement that M.N., Inc. was "in the process of going public'plainly purported to describe activity already under way. Likewise, thatM.N., Inc. required a release "immediately' suggested that there wereexigent circumstances, requiring swift action, which existed at the timethe statements were made." Bond Leather, 764 F.2d at 936. Thesestatements are in marked contrast to the statements upon which Hoganclaims he relied in the instant case. See discussion, infra.

13 Indeed, the plaintiff alleges that at the time these statementswere made he "was then told that this was not an official offer butsomething that Boston Gas was reviewing." (#1 ¶ 16)

14 Whether there is a requirement that consideration must be tenderedback as a condition precedent to bringing an ERISA action has yet to bedetermined in this Circuit.

1. With the parties' consent, on April 4, 2001, this case has beenreferred and reassigned to the undersigned for all purposes, includingtrial and the entry of judgment, pursuant to 28 U.S.C. § 636 (c).

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