The opinion of the court was delivered by: FERN M. SMITH
On December 22, 1992, the Court denied Defendants' Motion to Dismiss. The parties have now filed cross-motions for summary judgment which squarely present the issue of whether California state courts have the authority to determine whether a Domestic Relations Order is a Qualified Domestic Relations Order ("QDRO") for purposes of ERISA and to order an ERISA plan administrator to comply with the terms of that order. For the reasons set forth below, the Court finds that concurrent jurisdiction exists in this area of ERISA and therefore GRANTS the Defendants' Motion for Summary Judgment and DENIES the Plaintiffs' Motion for Summary Judgment.
Defendants Clevon and Leola Levingston were married on May 15, 1971 and separated on September 30, 1987. On December 5, 1988, Alameda County Superior Court entered a judgment of dissolution but reserved jurisdiction over the division of the Defendants' community property. On December 30, 1988, Clevon married Yvonne Levingston.
Clevon had participated in the pension plan ("the Plan") maintained by Plaintiffs ("the Fund"). The Plan is a multiemployer, defined benefit pension plan and is subject to ERISA. On September 30, 1988, the Fund was joined in the Levingston dissolution proceeding pursuant to Cal. Civil Code § 4363.1. The Fund entered an appearance in that proceeding on November 30, 1988.
In March 1989, Clevon terminated his employment and applied for benefits under the Plan. Sections 7.01 and 7.03 of the Plan require that a married participant be paid benefits in the form of a "Husband-and-Wife Pension", unless the spouse consents to a different form of distribution under the plan. A "Husband-and-Wife Pension" is a type of "joint and survivor annuity" which pays a lifetime monthly benefit for the life of the participant, with one-half of the monthly amount payable to the participant's surviving spouse after the participant's death. In accordance with 29 U.S.C. § 1055, a married participant must elect the joint and survivor option unless the spouse consents to another form of payment, such as the Single Life Pension which consists only of monthly payments for the life of the participant.
Starting in April 1989, Clevon received Husband-and-Wife payments while one-half of the normal benefits accrued during his marriage to Leola was withheld pending a determination of Leola's community property interests. Leola filed a motion in Alameda County Superior Court requesting a division of her interest in the pension. On March 7, 1991, the court approved a stipulation between Clevon and Leola which provided for Leola to receive a monthly benefit for her life that was the actuarial equivalent of her share of the benefits payable for Clevon's life, using the interest and mortality assumptions specified by the terms of the Plan.
This order was submitted to Plaintiff Johnson, the Plan's administrator who concluded that this order was not a QDRO and therefore the Fund was not obliged to make payments under the order. The state court then issued an order to show cause directing the Fund to show why the order was not a QDRO. A hearing was held on September 23, 1991. The Fund did not appear at the hearing or file an opposition brief. On January 22, 1992, the state court issued an order holding that:
(1) the March 7, 1991 order was a QDRO under ERISA and the Retirement Equity Act ("REA");
(2) the Fund had notice of the hearing;
(3) the March 7, 1991 order did not require payment of benefits that exceeded Leola's rights under ERISA or REA;
(4) the Fund was further ordered to qualify the March 7, 1991 order and pay benefits pursuant to the order.
On March 31, 1992, the Fund appealed to the California Court of Appeal. Alameda County Superior Court entered an order directing the Fund to pay $ 10,000 attorneys fees for Leola's expenses in defending the appeal pursuant to Cal. Civil Code §§ 4370 and 4370.5. On August 13, 1992, the Court of Appeal stayed the appeal and ordered the Fund to pay the attorneys fees by October 1, 1992. The Fund did pay those fees and the Court of Appeal issued a published decision, In re Marriage of Levingston, 93 C.D.O.S. 696 (January 28, 1993), holding that state courts do have concurrent jurisdiction to review a plan administrator's decision that a particular order is not a QDRO.
The Fund filed this action in Federal Court on July 28, 1992, seeking injunctive and declaratory relief pursuant to 29 U.S.C. § 1132 (a)(2) and (a)(3). After receiving the complaint in this case, Leola filed a motion in state court for an order directing the Fund to pay attorneys fees in this action. A hearing on that motion was held on September 14, 1992, and the Fund made no appearance. The Superior Court then entered an order requiring the Fund to pay Leola's fees in this action. The Fund contends that it never received notice of the hearing and order until October 15, 1992. The Fund has moved to ...