DEVINE v. COMBUSTION ENGINEERING

Civ. No. H-90-280 (JAC)

760 F. Supp. 989 (1991) | Cited 0 times | D. Connecticut | April 15, 1991

RULING ON PENDING MOTIONS

Plaintiffs are former employees of the defendant CombustionEngineering, Inc. ("CE"), and they allege that defendants haveviolated their rights under a retirement benefit plan. In theirSecond Amended Complaint (filed Aug. 9, 1990) ("Complaint"),plaintiffs allege that between 1983 and 1985 CE offered tocertain eligible employees a new retirement program — theVoluntary Separation Incentive Program ("VSIP") — under whichanyone who took early retirement could receive, among otherbenefits, free lifetime medical and dentalbenefits for themselves and their spouses. Plaintiffs allegethat in October 1989, defendants broke their promise of freelifetime medical and dental benefits and required the VSIPbeneficiaries to pay monthly premiums beginning in January1990, in violation of the Employee Retirement Income SecurityAct, 29 U.S.C. § 1001-1461 (1988) ("ERISA") and of Connecticutstate law.

The following motions are currently pending: (1) Defendants'Motion to Dismiss and to Strike (filed Aug. 31, 1990); and (2)Plaintiffs' Motion for Class Certification (filed June 11,1990). After oral argument on March 22, 1991, the courtafforded the parties an opportunity to brief questionsconcerning jury trial and penalties under ERISA as well ascertain issues relating to class certification. On April 5,1991, the pending motions were deemed submitted for decision.

I. DISCUSSION

A. Defendants' Motion to Dismiss and to Strike

In considering a motion to dismiss, the court is mindful thatthe complaint is to be read generously and all inferences areto be drawn in favor of the plaintiffs. See Conley v. Gibson,355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957);Yoder v. Orthomolecular Nutrition Inst., Inc., 751 F.2d 555,562 (2d Cir. 1985). Indeed, for the purposes of this motiononly, the court is required to assume that the allegations ofthe Complaint are true. Cruz v. Beto, 405 U.S. 319, 322, 92S.Ct. 1079, 1081, 31 L.Ed.2d 263 (1972).

1. Preemption of Counts Four, Five, and Six

At oral argument on March 22, 1991, plaintiffs' counselexplained for the first time that the state law claims forfraudulent inducement (Count Four), Negligent Inducement (CountFive) and Breach of Contract (Count Six) have been pled in thealternative. See Transcript of Hearing of March 22, 1991 (filedMar. 23, 1991) at 36 ("The plaintiffs are not claiming herethat they're entitled to relief under two sources of law. Theplaintiffs will readily concede that if the Court decides thattheir documents fall under ERISA and that their documentsconstitute an ERISA plan, then they will withdraw their stateclaims.").

The question of whether or not the VSIP ought to beconsidered a separate and distinct plan under ERISA — aquestion that has not yet been resolved — is different fromthe question of whether or not the VSIPs "relate to anyemployee benefit plan" under section 514(a) of ERISA.1 TheSupreme Court has recognized that the key to interpretingsection 514(a) is found in the words "relate to." SeeIngersoll-Rand Co. v. McClendon, ___ U.S. ___, 111 S.Ct. 478,482, 112 L.Ed.2d 474 (1990); FMC Corp. v. Holliday, ___ U.S.___, 111 S.Ct. 403, 407, 112 L.Ed.2d 356 (1990); see alsoGeneral Elec. Co. v. New York State Dep't of Labor,891 F.2d 25, 29 (2d Cir. 1989), cert. denied, ___ U.S. ___, 110 S.Ct.2603, 110 L.Ed.2d 283 (1990). In Ingersoll-Rand, the Courtrecently held that a state cause of action for wrongfuldischarge was preempted by ERISA because "the existence of apension plan [was] a critical factor in establishing liabilityunder the State's wrongful discharge law. As a result, thiscause of action related not merely to pension plans, but to theessence of the pension plan itself." Ingersoll-Rand, 111 S.Ct.at 483.

The Supreme Court has emphasized repeatedly that preemptionunder ERISA is not limited to state laws specifically designedto affect employee benefit plans. See Pilot Life Ins. Co. v.Dedeaux, 481 U.S. 41, 47-48, 107 S.Ct. 1549, 1552-53, 95L.Ed.2d 39 (1987) (holding that state common law tort andcontract actions asserting improper processing of a claim forbenefits are preempted); Shaw v. Delta Air Lines, Inc.,463 U.S. 85, 98, 103 S.Ct. 2890, 2900, 77 L.Ed.2d 490 (1983). InLee v. E.I. DuPont de Nemours & Co., 894 F.2d 755 (5thCir. 1990), the court held that plaintiff's state law claims offraud and negligent misrepresentation with respect to anemployer's early retirement incentive plan were preempted byERISA. Significantly, the court "did not decide whether ERISAwould provide relief on the facts of this case. Any remedy thatdoes exist, however, must come from within that exclusivelyfederal scheme of pension regulation." Id. at 758.

Plaintiffs' arguments that the relevant state law was notspecifically written to govern benefit plans or that ERISA'spreemption statute is unconstitutional because it purports tointerfere with rights of sovereign authority guaranteed to thestates by the Tenth Amendment, see Memorandum of Law inOpposition to Defendants' Motion of August 30, 1990 to Dismissand to Strike Plaintiffs' Complaint (filed Oct. 15, 1990)("Plaintiffs' Opposition") at 39-51, are arguments that havelong since been rejected by the Supreme Court in interpretingthe scope of preemption. ERISA was intended to have a "sweepingpreemptive effect in the employee benefit plan field," AmericanProgressive Life & Health Ins. Co. v. Corcoran, 715 F.2d 784,786 (2d Cir. 1983). The purpose of the preemption statute wasto ensure that plans would be subject to a uniform body ofbenefit law. The goal was to avoid harm to plan beneficiariesthat could be the result of the inevitable inefficienciescreated by requiring plan sponsors to comply with conflictingdirectives among states or between states and the federalGovernment. See Ingersoll-Rand, 111 S.Ct. at 484.

Counts Four, Five and Six of plaintiffs' Complaint undeniablyrelate to an employee benefit plan. In these counts claimingviolations of Connecticut state law, plaintiffs plead theexistence of an employee benefit plan. The fact that the courthas not yet determined whether plaintiffs are entitled torelief under ERISA does not change the fact that ERISA is theonly place where any remedy may be found. Accordingly,defendants' motion to dismiss with respect to Counts Four,Five, and Six is granted, and those counts are hereby dismissedwith prejudice.

2. Breach of Fiduciary Duty

Plaintiffs, as plan participants and beneficiaries, may bringa civil action under section 502(a)(2) of ERISA for appropriaterelief under the breach of fiduciary duty provision.2However, the only relief that may be granted under these claimsis to the plan itself. See Massachusetts Mutual Life Ins. Co.v. Russell, 473 U.S. 134, 142, 105 S.Ct. 3085, 3090, 87 L.Ed.2d96 (1985); In re Emhart Corp., 706 F. Supp. 153, 158 (D.Conn.1988). In Plaintiffs' Opposition to Defendants' Reply toPlaintiffs' Response to the Motion to Dismiss and to Strike(filed Jan. 14, 1991) at 8, plaintiffs agree that they are notpermitted under section 502(a)(2) to recover damages as planparticipants or beneficiaries. All plaintiffs may do is sue onbehalf of the plan, and any losses to the plan resulting from abreach of fiduciary duty will be returned to the plan itself.It is worth remembering that in the context of a motion todismiss, "[t]he issue is not whether a plaintiff willultimately prevail but whether the claimant is entitled tooffer evidence to support the claims." Scheuer v. Rhodes,416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974).Defendants' motion to dismiss with respect to the claims forbreach of fiduciary duty in Count One is denied.

3. Non-Disclosure Penalties

With respect to plaintiffs' claim in Count Two that they areentitled to "penalties for non-disclosure," Complaint, ¶ 40(f),I am persuaded that they have met the liberal standard ofnotice pleading. The Complaint alleges that "[n]o VSIP amendedbooklets or Summary Plan Descriptions were distributed toplaintiffs, despite repeated requests by individual retirees.None have been supplied to date." Complaint, ¶ 29. Of course,plaintiffs will have the ultimate burden of proving by apreponderance of the evidence that defendants have violatedERISA's disclosure requirements. Although I intimate no view onthe question of whether section 502(c) of ERISA provides theexclusive remedy for allegations of non-disclosure, I believethat defendants are sufficiently on notice as to the nature ofplaintiffs' non-disclosure claim to justify permittingplaintiff to offer evidence to support this claim. Defendants'motion to dismiss with respect to plaintiffs' non-disclosureclaim in Count Two of the Complaint is denied.

4. Punitive Damages

Although our own Court of Appeals has not addressed the issueof whether punitive damages are available under ERISA, there isoverwhelming authority, both in other circuits and in thisdistrict, that punitive damages are not recoverable undersection 502(a). See, e.g., Drinkwater v. Metropolitan Life Ins.Co., 846 F.2d 821 (1st Cir.), cert. denied, 488 U.S. 909, 109S.Ct. 261, 102 L.Ed.2d 249 (1988); Pane v. RCA Corp.,868 F.2d 631 (3d Cir. 1989); In re Emhart Corp., 706 F. Supp. at 156;Bartucca v. Katy Industries, Inc., 668 F. Supp. 111, 114(D.Conn. 1987). In light of the court's ruling that plaintiffs'state law counts must be dismissed, there remains no claim forwhich punitive damages would either be available orappropriate. Defendants' motion to strike plaintiffs' claim forpunitive damages in Count Three of plaintiffs' complaint isgranted.

5. Interference With Protected Rights

In Count Three of their complaint, plaintiffs have allegedthat defendants violated section 510 of ERISA3 by trickingthem "into leaving their employment early in order to savemoney." Complaint, ¶ 45. Assuming plaintiffs' allegations to betrue for purposes of the motion to dismiss, I believe that theyhave stated a cause of action for which relief may be granted.They are certainly entitled to offer evidence to support thisclaim. Defendants' motion to dismiss with respect to thesection 510 claim in Count Three of plaintiffs' complaint isdenied.

6. Jury Trial

Plaintiffs argue that they did not waive their right to ajury trial of their claims under ERISA because they included intheir general prayer for relief a request for jury trial.See Plaintiffs' Response to Defendants' Memorandum inOpposition to Plaintiffs' Request for Jury Trial and PenaltiesUnder ERISA (filed Apr. 8, 1991) at 1; Complaint, ¶ 61(g).Defendants interpreted this request, which comes at the end ofCount Six, as applying only to Count Six itself. SeeDefendants' Memorandum in Opposition to Plaintiffs' Request fora Jury Trial and Penalties Under ERISA (filed Apr. 1, 1991) at2. Defendants find further support for their position in thefact that plaintiffs explicitly requested a jury in the prayerfor relief sections of Counts Four and Five, see Complaint, ¶¶52(d) & 56(c), but not in the corresponding sections of CountsOne, Two, and Three claiming violations of ERISA, seeComplaint, ¶¶ 34, 41, & 48. I am persuaded that plaintiffs'demand for a jury trial applied only to the state law claims inCounts Four, Five, and Six. The fact that plaintiffs checkedthe "jury demand"box on the civil cover sheet provided insufficient notice todefendants because defendants quite reasonably assumed that thejury demand applied only to the state law claims, each of whichexplicitly included a request for a jury trial.

Even if I assume for the argument only that plaintiffs havenot waived their right to a jury trial on their ERISA claims,I find that their allegations are essentially equitable innature for which a jury trial would be inappropriate. Our Courtof Appeals held in Katsaros v. Cody, 744 F.2d 270 (2d Cir.),cert. denied sub nom. Cody v. Donovan, 469 U.S. 1072, 105 S.Ct.565, 83 L.Ed.2d 506 (1984), that there is no right to a jurytrial of ERISA actions seeking "equitable relief in the form ofremoval and restitution as distinguished from damages forwrongdoing or non-payment of benefits." Id. at 278. Plaintiffshave alleged, for example, that defendants have breached theirfiduciary duty to the plan, see Complaint, ¶ 33, and they seek,among other relief, "an injunction preventing defendants or anysuccessor from amending or terminating the plaintiffs' RetireeComprehensive Medical Benefits and Dental Assistance Plancoverage under VSIP during their lives and the lives of theirspouses," Complaint, ¶¶ 34(c), 41(c), & 48(c). This is not acase where the ERISA claims look only like claims for breach ofcontract. Unlike in Zotto v. Scovill, No. N-85-494 (JAC), slipop. at 12, 1987 WL 49862 (D.Conn. May 27, 1987), the plaintiffshave made allegations of breach of fiduciary duty. Plaintiffscannot be permitted, on the one hand, to argue that theirclaims for breach of fiduciary duty ought to survive a motionto dismiss, see supra section A(2), and then to claim, on theother hand, that they are not trying to obtain a jury forequitable claims. Even if plaintiffs had properly demanded ajury trial — something that I believe they have failed to do— their demand would have been fruitless in light of theessentially equitable nature of their claims. Defendants motionto strike plaintiffs' jury demand is granted.

B. Plaintiffs' Motion for Class Certification

Plaintiffs seek certification of a class of "at least 690[CE] employees and their spouses who elected early retirementunder the VSIP program during 1983, 1984, and 1985,"Plaintiffs' Memorandum in Support of Motion for ClassCertification and Notice (filed June 11, 1990) ("Plaintiffs'Original Memorandum") at 3. At oral argument on March 22, 1991,the court ordered plaintiffs to submit any additional materialin support of their motion for class certification. After afull review of the entire record before me, I have determinedthat an evidentiary hearing on the question of classcertification is not required at this time.

There is no question that plaintiffs have satisfied the"numerosity" requirement of Rule 23(a)(1) inasmuch as "theclass is so numerous that joinder of all members isimpracticable." Defendants dispute that plaintiffs havesatisfied any of the other requirements under Rule 23.

1. Common Questions of Law or Fact

Plaintiffs allege that all putative class members "complainthat [defendants] promised, both orally and in writing,lifetime basic health care benefits to the plaintiff class. Assuch, the factual circumstances surrounding the promises oflifetime health care are common to all class members."Plaintiffs' Original Memorandum at 6. Defendants object to thischaracterization on several grounds. First, they insist thatthere is no one written communication that all members of theputative class received. Second, they argue that insofar asplaintiffs purport to rely on oral communications, these aretoo individualized and variable to be appropriate for classcertification. In re Scientific Control Corp. Sec. Litigation,71 F.R.D. 491, 503 (S.D.N.Y. 1976) (lack of proof of uniform orstandardized representations to purported class precluded classcertification).

Plaintiffs seek to rely on Alday v. Container Corp. ofAmerica, No. 87-488-Civ-J-16, slip op. (M.D.Fla. Sept. 2,1988), aff'd,906 F.2d 660 (11th Cir. 1990), for the proposition that classcertification may be appropriate even when the writtendocuments received by the class members were different.See Plaintiffs' Supplemental Memorandum in Support of ClassCertification (filed Apr. 1, 1991) ("Plaintiffs' SupplementalMemorandum") at 5. In Alday, the plaintiffs sought to certify aclass of employees who, as of a certain date, were participantsin the defendant company's retiree health insurance program.Plaintiffs alleged that defendants altered the health insuranceplan on that certain date in violation of ERISA and in breachof fiduciary duties. The court determined that certainquestions — whether defendants had the legal right to alterthe provisions of the plan and whether defendants breachedtheir fiduciary duty by failing to obtain the best possiblebenefits for the lowest price — were common to the purportedclass despite the fact that class members received different"summary booklets, form letters, individual letters, seminarsand oral statements on the health plan." Id., slip op. at 4.However, on the question of whether the actions of thedefendants in altering the provisions of the plan were inaccord with the "understanding" of the participants in the planas to their anticipated benefits, the court held that

[i]n the absence of at least one common written document, distributed to all members of the class, in which an objective determination as to its misleading nature could be made, the Court sees no means of handling Plaintiff's third question in a class action. Questions of a person's reliance on oral and written statements are personal and subjective in nature and not ones which can be lumped together into one common understanding.

Id., slip op. at 6.

Although certainly not binding on this court, theAlday court's reasoning is sound. I find that plaintiffs havefailed to show that there are common issues of fact sufficientto certify the entire putative class as they have sought todefine it. Plaintiffs have attempted to demonstrate thatalthough the purported class members received differentdocuments, the documents made the same basic promise on whichall retirees relied. See Plaintiffs' Supplemental Memorandum,Exhibits E & F. Plaintiffs state that the court need notinterpret these documents at this stage in the proceedings;"[w]hat these documents mean and whether they make the promisesplaintiffs claim they do, is of course, not the inquiry here."Id. at 3. But in order for the court to determine that thereare issues "common" to the entire class, it is not sufficientmerely to find that every class member received a document. Ifthere were one single promise that the court could examine andinterpret for the purposes of determining whether or notdefendants are liable to plaintiffs under ERISA, then it wouldbe immaterial that defendants made this promise in differentdocuments. But as the record now stands, plaintiffs have failedto show that the same promise was made to every member of thepurported class. Under the circumstances, certification of theputative class is inappropriate for failure to satisfy the"commonality" requirement of Rule 23(a)(2).

Defendants have admitted that "[t]he 340 VSIP retirees fromthe Windsor, Connecticut plant in July 1985, a group includingall of the named Plaintiffs, received two writtencommunications on which Plaintiffs (Windsor retirees) claim tohave relied to avoid the reservation of rights language in theSPDs." Supplemental Memorandum of Defendants in Opposition toPlaintiffs' Motion for Class Certification (filed Apr. 5, 1991)at 3. At least as to these 340 retirees from the defendants'Power Systems Group in Windsor, Connecticut, I find that theredo exist common questions of fact.

2. Typicality

The Supreme Court has stated that the commonality and typicality requirements of Rule 23(a) tend to merge. Both serve as guideposts for determining whether under the particular circumstances maintenance of a class action is economical and whether the named plaintiff's claim and the class claims are so interrelated that the interests of the class members will be fairly and adequately protected in their absence.

General Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 157n. 13, 102 S.Ct. 2364, 2370 n. 13, 72 L.Ed.2d 740 (1982). Thefact that plaintiffs have failed to satisfy the commonalityrequirements means that the circumstances of the namedplaintiffs are not typical of those of the entire putativeclass.

The "typicality" requirement is satisfied with respect to thegroup of retirees from the Windsor, Connecticut facility. Infact, all named plaintiffs retired from that facility.

3. Adequate Representation

Although I do not believe that the named plaintiffs satisfythe "adequacy" requirement with respect to the putative classthat plaintiffs now seek to certify, these plaintiffs doadequately represent the retirees from the Windsor, Connecticutfacility. They clearly have interests in common with the classof retirees who retired after having received the samedocuments. I also have no doubt that the plaintiffs willvigorously prosecute the interests of this class through theirqualified counsel.

4. Maintenance of the Class

In order to be maintainable as a class action, a suit mustmeet all the requirements set forth in Fed.R.Civ.P. 23(a) andmust also fall within one of the subsections of Fed.R.Civ.P.23(b). See Sicinski v. Reliance Funding Corp., 82 F.R.D. 730,734 (S.D.N.Y. 1979) (Pollack, J.).

With respect to the putative class of retirees from theWindsor, Connecticut facility, the prosecution of separateactions by individual members of the class would create a riskof adjudications which would, as a practical matter, bedispositive of the interests of the other members not partiesto the adjudications. Fed.R.Civ.P. 23(b)(1)(B). In addition,defendants have acted on grounds generally applicable to thisputative class as a whole, and if any remedy is found to berequired, it would be appropriate for the court to order finalinjunctive or declaratory relief with respect to the entireclass. Fed.R.Civ.P. 23(b)(2). Finally, it is appropriate tofind that, at least with respect to the written communicationsreceived by the retirees from the Windsor, Connecticutfacility, common questions of law or fact predominate over anyquestions affecting only individual members. Fed.R.Civ.P.23(b)(3).

II. CONCLUSION

For the reasons stated above, Defendants' Motion to Dismissand to Strike (filed Aug. 31, 1990) is GRANTED in part andDENIED in part: It is granted with respect to the state lawclaims, and Counts Four, Five, and Six of the Second AmendedComplaint are DISMISSED with prejudice; defendants' motion todismiss and to strike is granted with respect to plaintiffs'request for a jury demand on Counts One, Two, and Three andwith respect to plaintiffs' claim for punitive damages in CountThree; and Defendants' Motion to Dismiss and to Strike isdenied with respect to plaintiffs' claims for breach offiduciary duty, non-disclosure penalties, and interference withprotected rights.

Plaintiffs' Motion for Class Certification (filed June 11,1990) is GRANTED in part: This case is hereby certified as aclass action, and the class is defined as "all former employeesof Power Systems, Combustion Engineering, Inc. of Windsor,Connecticut who retired pursuant to the Voluntary SeparationIncentive Program between 1983 and July 1985."

It is so ordered.

1. Section 514(a) of ERISA provides that "the provisions ofthis [Act] . . . shall supersede any and all State laws insofaras they may now or hereafter relate to any employee benefitplan. . . ." 29 U.S.C. § 1144(a) (1988).

2. Under section 502(a)(2) of ERISA, "[a] civil action maybe brought . . . by the Secretary, or by a participant,beneficiary or fiduciary for appropriate relief under section1109 of this title." 29 U.S.C. § 1132(a)(2) (1988).

Section 1109 of title 29 is section 409(a) of ERISA, and therelevant portion reads as follows:

Any person who is a fiduciary with respect to a plan who breaches any of the responsibilities, obligations, or duties imposed upon fiduciaries by this subchapter shall be personally liable to make good to such plan any losses to the plan resulting from each such breach, and to restore to such plan any profits of such fiduciary which have been made through use of assets of the plan by the fiduciary, and shall be subject to such other equitable or remedial relief as the court may deem appropriate, including removal of such fiduciary.

29 U.S.C. § 1109(a) (1988).

3.T he relevant portion of section 510 of ERISA reads asfollows:

It shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which he is entitled under the provisions of an employee benefit plan . . . or for the purpose of interfering with the attainment of any right to which such participant may become entitled under the plan. . . .

29 U.S.C. § 1140 (1988).

RULING ON PENDING MOTIONS

Plaintiffs are former employees of the defendant CombustionEngineering, Inc. ("CE"), and they allege that defendants haveviolated their rights under a retirement benefit plan. In theirSecond Amended Complaint (filed Aug. 9, 1990) ("Complaint"),plaintiffs allege that between 1983 and 1985 CE offered tocertain eligible employees a new retirement program — theVoluntary Separation Incentive Program ("VSIP") — under whichanyone who took early retirement could receive, among otherbenefits, free lifetime medical and dentalbenefits for themselves and their spouses. Plaintiffs allegethat in October 1989, defendants broke their promise of freelifetime medical and dental benefits and required the VSIPbeneficiaries to pay monthly premiums beginning in January1990, in violation of the Employee Retirement Income SecurityAct, 29 U.S.C. § 1001-1461 (1988) ("ERISA") and of Connecticutstate law.

The following motions are currently pending: (1) Defendants'Motion to Dismiss and to Strike (filed Aug. 31, 1990); and (2)Plaintiffs' Motion for Class Certification (filed June 11,1990). After oral argument on March 22, 1991, the courtafforded the parties an opportunity to brief questionsconcerning jury trial and penalties under ERISA as well ascertain issues relating to class certification. On April 5,1991, the pending motions were deemed submitted for decision.

I. DISCUSSION

A. Defendants' Motion to Dismiss and to Strike

In considering a motion to dismiss, the court is mindful thatthe complaint is to be read generously and all inferences areto be drawn in favor of the plaintiffs. See Conley v. Gibson,355 U.S. 41, 45-46, 78 S.Ct. 99, 101-02, 2 L.Ed.2d 80 (1957);Yoder v. Orthomolecular Nutrition Inst., Inc., 751 F.2d 555,562 (2d Cir. 1985). Indeed, for the purposes of this motiononly, the court is required to assume that the allegations ofthe Complaint are true. Cruz v. Beto, 405 U.S. 319, 322, 92S.Ct. 1079, 1081, 31 L.Ed.2d 263 (1972).

1. Preemption of Counts Four, Five, and Six

At oral argument on March 22, 1991, plaintiffs' counselexplained for the first time that the state law claims forfraudulent inducement (Count Four), Negligent Inducement (CountFive) and Breach of Contract (Count Six) have been pled in thealternative. See Transcript of Hearing of March 22, 1991 (filedMar. 23, 1991) at 36 ("The plaintiffs are not claiming herethat they're entitled to relief under two sources of law. Theplaintiffs will readily concede that if the Court decides thattheir documents fall under ERISA and that their documentsconstitute an ERISA plan, then they will withdraw their stateclaims.").

The question of whether or not the VSIP ought to beconsidered a separate and distinct plan under ERISA — aquestion that has not yet been resolved — is different fromthe question of whether or not the VSIPs "relate to anyemployee benefit plan" under section 514(a) of ERISA.1 TheSupreme Court has recognized that the key to interpretingsection 514(a) is found in the words "relate to." SeeIngersoll-Rand Co. v. McClendon, ___ U.S. ___, 111 S.Ct. 478,482, 112 L.Ed.2d 474 (1990); FMC Corp. v. Holliday, ___ U.S.___, 111 S.Ct. 403, 407, 112 L.Ed.2d 356 (1990); see alsoGeneral Elec. Co. v. New York State Dep't of Labor,891 F.2d 25, 29 (2d Cir. 1989), cert. denied, ___ U.S. ___, 110 S.Ct.2603, 110 L.Ed.2d 283 (1990). In Ingersoll-Rand, the Courtrecently held that a state cause of action for wrongfuldischarge was preempted by ERISA because "the existence of apension plan [was] a critical factor in establishing liabilityunder the State's wrongful discharge law. As a result, thiscause of action related not merely to pension plans, but to theessence of the pension plan itself." Ingersoll-Rand, 111 S.Ct.at 483.

The Supreme Court has emphasized repeatedly that preemptionunder ERISA is not limited to state laws specifically designedto affect employee benefit plans. See Pilot Life Ins. Co. v.Dedeaux, 481 U.S. 41, 47-48, 107 S.Ct. 1549, 1552-53, 95L.Ed.2d 39 (1987) (holding that state common law tort andcontract actions asserting improper processing of a claim forbenefits are preempted); Shaw v. Delta Air Lines, Inc.,463 U.S. 85, 98, 103 S.Ct. 2890, 2900, 77 L.Ed.2d 490 (1983). InLee v. E.I. DuPont de Nemours & Co., 894 F.2d 755 (5thCir. 1990), the court held that plaintiff's state law claims offraud and negligent misrepresentation with respect to anemployer's early retirement incentive plan were preempted byERISA. Significantly, the court "did not decide whether ERISAwould provide relief on the facts of this case. Any remedy thatdoes exist, however, must come from within that exclusivelyfederal scheme of pension regulation." Id. at 758.

Plaintiffs' arguments that the relevant state law was notspecifically written to govern benefit plans or that ERISA'spreemption statute is unconstitutional because it purports tointerfere with rights of sovereign authority guaranteed to thestates by the Tenth Amendment, see Memorandum of Law inOpposition to Defendants' Motion of August 30, 1990 to Dismissand to Strike Plaintiffs' Complaint (filed Oct. 15, 1990)("Plaintiffs' Opposition") at 39-51, are arguments that havelong since been rejected by the Supreme Court in interpretingthe scope of preemption. ERISA was intended to have a "sweepingpreemptive effect in the employee benefit plan field," AmericanProgressive Life & Health Ins. Co. v. Corcoran, 715 F.2d 784,786 (2d Cir. 1983). The purpose of the preemption statute wasto ensure that plans would be subject to a uniform body ofbenefit law. The goal was to avoid harm to plan beneficiariesthat could be the result of the inevitable inefficienciescreated by requiring plan sponsors to comply with conflictingdirectives among states or between states and the federalGovernment. See Ingersoll-Rand, 111 S.Ct. at 484.

Counts Four, Five and Six of plaintiffs' Complaint undeniablyrelate to an employee benefit plan. In these counts claimingviolations of Connecticut state law, plaintiffs plead theexistence of an employee benefit plan. The fact that the courthas not yet determined whether plaintiffs are entitled torelief under ERISA does not change the fact that ERISA is theonly place where any remedy may be found. Accordingly,defendants' motion to dismiss with respect to Counts Four,Five, and Six is granted, and those counts are hereby dismissedwith prejudice.

2. Breach of Fiduciary Duty

Plaintiffs, as plan participants and beneficiaries, may bringa civil action under section 502(a)(2) of ERISA for appropriaterelief under the breach of fiduciary duty provision.2However, the only relief that may be granted under these claimsis to the plan itself. See Massachusetts Mutual Life Ins. Co.v. Russell, 473 U.S. 134, 142, 105 S.Ct. 3085, 3090, 87 L.Ed.2d96 (1985); In re Emhart Corp., 706 F. Supp. 153, 158 (D.Conn.1988). In Plaintiffs' Opposition to Defendants' Reply toPlaintiffs' Response to the Motion to Dismiss and to Strike(filed Jan. 14, 1991) at 8, plaintiffs agree that they are notpermitted under section 502(a)(2) to recover damages as planparticipants or beneficiaries. All plaintiffs may do is sue onbehalf of the plan, and any losses to the plan resulting from abreach of fiduciary duty will be returned to the plan itself.It is worth remembering that in the context of a motion todismiss, "[t]he issue is not whether a plaintiff willultimately prevail but whether the claimant is entitled tooffer evidence to support the claims." Scheuer v. Rhodes,416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974).Defendants' motion to dismiss with respect to the claims forbreach of fiduciary duty in Count One is denied.

3. Non-Disclosure Penalties

With respect to plaintiffs' claim in Count Two that they areentitled to "penalties for non-disclosure," Complaint, ¶ 40(f),I am persuaded that they have met the liberal standard ofnotice pleading. The Complaint alleges that "[n]o VSIP amendedbooklets or Summary Plan Descriptions were distributed toplaintiffs, despite repeated requests by individual retirees.None have been supplied to date." Complaint, ¶ 29. Of course,plaintiffs will have the ultimate burden of proving by apreponderance of the evidence that defendants have violatedERISA's disclosure requirements. Although I intimate no view onthe question of whether section 502(c) of ERISA provides theexclusive remedy for allegations of non-disclosure, I believethat defendants are sufficiently on notice as to the nature ofplaintiffs' non-disclosure claim to justify permittingplaintiff to offer evidence to support this claim. Defendants'motion to dismiss with respect to plaintiffs' non-disclosureclaim in Count Two of the Complaint is denied.

4. Punitive Damages

Although our own Court of Appeals has not addressed the issueof whether punitive damages are available under ERISA, there isoverwhelming authority, both in other circuits and in thisdistrict, that punitive damages are not recoverable undersection 502(a). See, e.g., Drinkwater v. Metropolitan Life Ins.Co., 846 F.2d 821 (1st Cir.), cert. denied, 488 U.S. 909, 109S.Ct. 261, 102 L.Ed.2d 249 (1988); Pane v. RCA Corp.,868 F.2d 631 (3d Cir. 1989); In re Emhart Corp., 706 F. Supp. at 156;Bartucca v. Katy Industries, Inc., 668 F. Supp. 111, 114(D.Conn. 1987). In light of the court's ruling that plaintiffs'state law counts must be dismissed, there remains no claim forwhich punitive damages would either be available orappropriate. Defendants' motion to strike plaintiffs' claim forpunitive damages in Count Three of plaintiffs' complaint isgranted.

5. Interference With Protected Rights

In Count Three of their complaint, plaintiffs have allegedthat defendants violated section 510 of ERISA3 by trickingthem "into leaving their employment early in order to savemoney." Complaint, ¶ 45. Assuming plaintiffs' allegations to betrue for purposes of the motion to dismiss, I believe that theyhave stated a cause of action for which relief may be granted.They are certainly entitled to offer evidence to support thisclaim. Defendants' motion to dismiss with respect to thesection 510 claim in Count Three of plaintiffs' complaint isdenied.

6. Jury Trial

Plaintiffs argue that they did not waive their right to ajury trial of their claims under ERISA because they included intheir general prayer for relief a request for jury trial.See Plaintiffs' Response to Defendants' Memorandum inOpposition to Plaintiffs' Request for Jury Trial and PenaltiesUnder ERISA (filed Apr. 8, 1991) at 1; Complaint, ¶ 61(g).Defendants interpreted this request, which comes at the end ofCount Six, as applying only to Count Six itself. SeeDefendants' Memorandum in Opposition to Plaintiffs' Request fora Jury Trial and Penalties Under ERISA (filed Apr. 1, 1991) at2. Defendants find further support for their position in thefact that plaintiffs explicitly requested a jury in the prayerfor relief sections of Counts Four and Five, see Complaint, ¶¶52(d) & 56(c), but not in the corresponding sections of CountsOne, Two, and Three claiming violations of ERISA, seeComplaint, ¶¶ 34, 41, & 48. I am persuaded that plaintiffs'demand for a jury trial applied only to the state law claims inCounts Four, Five, and Six. The fact that plaintiffs checkedthe "jury demand"box on the civil cover sheet provided insufficient notice todefendants because defendants quite reasonably assumed that thejury demand applied only to the state law claims, each of whichexplicitly included a request for a jury trial.

Even if I assume for the argument only that plaintiffs havenot waived their right to a jury trial on their ERISA claims,I find that their allegations are essentially equitable innature for which a jury trial would be inappropriate. Our Courtof Appeals held in Katsaros v. Cody, 744 F.2d 270 (2d Cir.),cert. denied sub nom. Cody v. Donovan, 469 U.S. 1072, 105 S.Ct.565, 83 L.Ed.2d 506 (1984), that there is no right to a jurytrial of ERISA actions seeking "equitable relief in the form ofremoval and restitution as distinguished from damages forwrongdoing or non-payment of benefits." Id. at 278. Plaintiffshave alleged, for example, that defendants have breached theirfiduciary duty to the plan, see Complaint, ¶ 33, and they seek,among other relief, "an injunction preventing defendants or anysuccessor from amending or terminating the plaintiffs' RetireeComprehensive Medical Benefits and Dental Assistance Plancoverage under VSIP during their lives and the lives of theirspouses," Complaint, ¶¶ 34(c), 41(c), & 48(c). This is not acase where the ERISA claims look only like claims for breach ofcontract. Unlike in Zotto v. Scovill, No. N-85-494 (JAC), slipop. at 12, 1987 WL 49862 (D.Conn. May 27, 1987), the plaintiffshave made allegations of breach of fiduciary duty. Plaintiffscannot be permitted, on the one hand, to argue that theirclaims for breach of fiduciary duty ought to survive a motionto dismiss, see supra section A(2), and then to claim, on theother hand, that they are not trying to obtain a jury forequitable claims. Even if plaintiffs had properly demanded ajury trial — something that I believe they have failed to do— their demand would have been fruitless in light of theessentially equitable nature of their claims. Defendants motionto strike plaintiffs' jury demand is granted.

B. Plaintiffs' Motion for Class Certification

Plaintiffs seek certification of a class of "at least 690[CE] employees and their spouses who elected early retirementunder the VSIP program during 1983, 1984, and 1985,"Plaintiffs' Memorandum in Support of Motion for ClassCertification and Notice (filed June 11, 1990) ("Plaintiffs'Original Memorandum") at 3. At oral argument on March 22, 1991,the court ordered plaintiffs to submit any additional materialin support of their motion for class certification. After afull review of the entire record before me, I have determinedthat an evidentiary hearing on the question of classcertification is not required at this time.

There is no question that plaintiffs have satisfied the"numerosity" requirement of Rule 23(a)(1) inasmuch as "theclass is so numerous that joinder of all members isimpracticable." Defendants dispute that plaintiffs havesatisfied any of the other requirements under Rule 23.

1. Common Questions of Law or Fact

Plaintiffs allege that all putative class members "complainthat [defendants] promised, both orally and in writing,lifetime basic health care benefits to the plaintiff class. Assuch, the factual circumstances surrounding the promises oflifetime health care are common to all class members."Plaintiffs' Original Memorandum at 6. Defendants object to thischaracterization on several grounds. First, they insist thatthere is no one written communication that all members of theputative class received. Second, they argue that insofar asplaintiffs purport to rely on oral communications, these aretoo individualized and variable to be appropriate for classcertification. In re Scientific Control Corp. Sec. Litigation,71 F.R.D. 491, 503 (S.D.N.Y. 1976) (lack of proof of uniform orstandardized representations to purported class precluded classcertification).

Plaintiffs seek to rely on Alday v. Container Corp. ofAmerica, No. 87-488-Civ-J-16, slip op. (M.D.Fla. Sept. 2,1988), aff'd,906 F.2d 660 (11th Cir. 1990), for the proposition that classcertification may be appropriate even when the writtendocuments received by the class members were different.See Plaintiffs' Supplemental Memorandum in Support of ClassCertification (filed Apr. 1, 1991) ("Plaintiffs' SupplementalMemorandum") at 5. In Alday, the plaintiffs sought to certify aclass of employees who, as of a certain date, were participantsin the defendant company's retiree health insurance program.Plaintiffs alleged that defendants altered the health insuranceplan on that certain date in violation of ERISA and in breachof fiduciary duties. The court determined that certainquestions — whether defendants had the legal right to alterthe provisions of the plan and whether defendants breachedtheir fiduciary duty by failing to obtain the best possiblebenefits for the lowest price — were common to the purportedclass despite the fact that class members received different"summary booklets, form letters, individual letters, seminarsand oral statements on the health plan." Id., slip op. at 4.However, on the question of whether the actions of thedefendants in altering the provisions of the plan were inaccord with the "understanding" of the participants in the planas to their anticipated benefits, the court held that

[i]n the absence of at least one common written document, distributed to all members of the class, in which an objective determination as to its misleading nature could be made, the Court sees no means of handling Plaintiff's third question in a class action. Questions of a person's reliance on oral and written statements are personal and subjective in nature and not ones which can be lumped together into one common understanding.

Id., slip op. at 6.

Although certainly not binding on this court, theAlday court's reasoning is sound. I find that plaintiffs havefailed to show that there are common issues of fact sufficientto certify the entire putative class as they have sought todefine it. Plaintiffs have attempted to demonstrate thatalthough the purported class members received differentdocuments, the documents made the same basic promise on whichall retirees relied. See Plaintiffs' Supplemental Memorandum,Exhibits E & F. Plaintiffs state that the court need notinterpret these documents at this stage in the proceedings;"[w]hat these documents mean and whether they make the promisesplaintiffs claim they do, is of course, not the inquiry here."Id. at 3. But in order for the court to determine that thereare issues "common" to the entire class, it is not sufficientmerely to find that every class member received a document. Ifthere were one single promise that the court could examine andinterpret for the purposes of determining whether or notdefendants are liable to plaintiffs under ERISA, then it wouldbe immaterial that defendants made this promise in differentdocuments. But as the record now stands, plaintiffs have failedto show that the same promise was made to every member of thepurported class. Under the circumstances, certification of theputative class is inappropriate for failure to satisfy the"commonality" requirement of Rule 23(a)(2).

Defendants have admitted that "[t]he 340 VSIP retirees fromthe Windsor, Connecticut plant in July 1985, a group includingall of the named Plaintiffs, received two writtencommunications on which Plaintiffs (Windsor retirees) claim tohave relied to avoid the reservation of rights language in theSPDs." Supplemental Memorandum of Defendants in Opposition toPlaintiffs' Motion for Class Certification (filed Apr. 5, 1991)at 3. At least as to these 340 retirees from the defendants'Power Systems Group in Windsor, Connecticut, I find that theredo exist common questions of fact.

2. Typicality

The Supreme Court has stated that the commonality and typicality requirements of Rule 23(a) tend to merge. Both serve as guideposts for determining whether under the particular circumstances maintenance of a class action is economical and whether the named plaintiff's claim and the class claims are so interrelated that the interests of the class members will be fairly and adequately protected in their absence.

General Telephone Co. of Southwest v. Falcon, 457 U.S. 147, 157n. 13, 102 S.Ct. 2364, 2370 n. 13, 72 L.Ed.2d 740 (1982). Thefact that plaintiffs have failed to satisfy the commonalityrequirements means that the circumstances of the namedplaintiffs are not typical of those of the entire putativeclass.

The "typicality" requirement is satisfied with respect to thegroup of retirees from the Windsor, Connecticut facility. Infact, all named plaintiffs retired from that facility.

3. Adequate Representation

Although I do not believe that the named plaintiffs satisfythe "adequacy" requirement with respect to the putative classthat plaintiffs now seek to certify, these plaintiffs doadequately represent the retirees from the Windsor, Connecticutfacility. They clearly have interests in common with the classof retirees who retired after having received the samedocuments. I also have no doubt that the plaintiffs willvigorously prosecute the interests of this class through theirqualified counsel.

4. Maintenance of the Class

In order to be maintainable as a class action, a suit mustmeet all the requirements set forth in Fed.R.Civ.P. 23(a) andmust also fall within one of the subsections of Fed.R.Civ.P.23(b). See Sicinski v. Reliance Funding Corp., 82 F.R.D. 730,734 (S.D.N.Y. 1979) (Pollack, J.).

With respect to the putative class of retirees from theWindsor, Connecticut facility, the prosecution of separateactions by individual members of the class would create a riskof adjudications which would, as a practical matter, bedispositive of the interests of the other members not partiesto the adjudications. Fed.R.Civ.P. 23(b)(1)(B). In addition,defendants have acted on grounds generally applicable to thisputative class as a whole, and if any remedy is found to berequired, it would be appropriate for the court to order finalinjunctive or declaratory relief with respect to the entireclass. Fed.R.Civ.P. 23(b)(2). Finally, it is appropriate tofind that, at least with respect to the written communicationsreceived by the retirees from the Windsor, Connecticutfacility, common questions of law or fact predominate over anyquestions affecting only individual members. Fed.R.Civ.P.23(b)(3).

II. CONCLUSION

For the reasons stated above, Defendants' Motion to Dismissand to Strike (filed Aug. 31, 1990) is GRANTED in part andDENIED in part: It is granted with respect to the state lawclaims, and Counts Four, Five, and Six of the Second AmendedComplaint are DISMISSED with prejudice; defendants' motion todismiss and to strike is granted with respect to plaintiffs'request for a jury demand on Counts One, Two, and Three andwith respect to plaintiffs' claim for punitive damages in CountThree; and Defendants' Motion to Dismiss and to Strike isdenied with respect to plaintiffs' claims for breach offiduciary duty, non-disclosure penalties, and interference withprotected rights.

Plaintiffs' Motion for Class Certification (filed June 11,1990) is GRANTED in part: This case is hereby certified as aclass action, and the class is defined as "all former employeesof Power Systems, Combustion Engineering, Inc. of Windsor,Connecticut who retired pursuant to the Voluntary SeparationIncentive Program between 1983 and July 1985."

It is so ordered.

1. Section 514(a) of ERISA provides that "the provisions ofthis [Act] . . . shall supersede any and all State laws insofaras they may now or hereafter relate to any employee benefitplan. . . ." 29 U.S.C. § 1144(a) (1988).

2. Under section 502(a)(2) of ERISA, "[a] civil action maybe brought . . . by the Secretary, or by a participant,beneficiary or fiduciary for appropriate relief under section1109 of this title." 29 U.S.C. § 1132(a)(2) (1988).

Section 1109 of title 29 is section 409(a) of ERISA, and therelevant portion reads as follows:

Any person who is a fiduciary with respect to a plan who breaches any of the responsibilities, obligations, or duties imposed upon fiduciaries by this subchapter shall be personally liable to make good to such plan any losses to the plan resulting from each such breach, and to restore to such plan any profits of such fiduciary which have been made through use of assets of the plan by the fiduciary, and shall be subject to such other equitable or remedial relief as the court may deem appropriate, including removal of such fiduciary.

29 U.S.C. § 1109(a) (1988).

3.T he relevant portion of section 510 of ERISA reads asfollows:

It shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which he is entitled under the provisions of an employee benefit plan . . . or for the purpose of interfering with the attainment of any right to which such participant may become entitled under the plan. . . .

29 U.S.C. § 1140 (1988).

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