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Trustees of the Southern California IBEW-NECA Pension Plan v. Rios

October 4, 2009

TRUSTEES OF THE SOUTHERN CALIFORNIA IBEW-NECA PENSION PLAN, PLAINTIFF,
v.
RICHARD RIOS, AN INDIVIDUAL DEFENDANT.



The opinion of the court was delivered by: Stephen G. Larson United States District Judge

FINDINGS OF FACT AND CONCLUSIONS OF LAW

This matter is before the Court on administrative review.

Plaintiff Trustees of the Southern California IBEW-NECA Pension Plan ("Trustees") is a labor-management multi-employer trust, and is subject to the requirements of the Employee Retirement Income Security Act of 1974 ("ERISA"). Defendant Richard Rios ("Rios") began receiving early retirement pension benefits from the Trustees in October, 1994.

In June, 2005, the Trustees suspended Rios's benefits when his post-retirement employment was determined "suspendible" and "nonunion."

The Trustees have now brought suit against Rios to recover $41,899.88 in overpaid pension benefits from August, 2003 through May, 2005. The Court has reviewed the parties' briefs and the administrative record. Having now carefully considered the full record and arguments of the parties, the Court finds and concludes as follows:

I. The Policy

The Southern California IBEW-NECA Pension Plan ("Plan") is a pension fund created by agreement between southern California employers in the electrical contracting industry, certain chapters of the National Electrical Contractors Association in Southern California, and various local electrical unions (including International Brotherhood of Electrical Workers Local Union No. 11). Administrative Record ("AR") 59-60. As part of the agreement, the employers are required to contribute to the pension fund on behalf of their employees represented by the union. AR 59-60. When these employees retire, they become eligible to receive from the fund a monthly pension benefit. AR 45, 50-51.

Like most employee pension funds, the Plan is subject to the requirements of ERISA. AR 62-63. Under ERISA, pension plans must provide that "an employee's right to his normal retirement benefit is non-forfeitable upon the attainment of normal retirement age." 29 U.S.C. § 1053(a). Consistent with this requirement, however, multi-employer plans may condition benefits on an employee's promise not to engage in certain kinds of employment after retirement. If a retiree returns to work "in the same industry, in the same trade or craft, and the same geographic area covered by the plan," ERISA allows the retiree's benefits to be suspended for as long as he remains in that employment. Id. §1053(a)(3)(B)(ii).

Incorporating these terms, and with respect to early retirement, the Plan provides: "Suspendible employment means work in the electrical construction contracting industry, in the same geographic area that was covered by the Plan when the Pensioner's benefits commenced, in the same trade or craft in which the Pensioner worked at any time in Covered Employment." AR 101.

In addition, to be eligible for early retirement under the Plan, the participant must refrain from both suspendible employment, and "nonunion employment." AR 101-103.

Accordingly, the Plan requires all participants receiving pension benefits to report any employment in the electrical construction contracting industry to the Trustees. AR 57, 103. The Trustees, who administer the Plan, are comprised of an equal number of employer (also known as "management") trustees and employee (also known as "labor") trustees.*fn1 AR 59. The Trustees determine whether the work reported by participants is suspendible or nonunion, and given that determination, whether pension benefits may continue to the participant. AR 103-104. Under the Plan, the Trustees also have the right to recover any overpayment of pension benefits. AR 103-104.

II. Statement of Facts

Rios became a member of the International Brotherhood of Electrical Workers ("IBEW") Local Union No. 11 and a participant in the Plan in 1975. Declaration of Richard Rios ("Rios Decl.) ¶ 4. He became eligible for early retirement in September, 1994. Rios Decl. ¶ 4. In July, 1993, Rios received a written memorandum from the administrative office of the Plan that explained his pension benefits would not begin unless he submitted a written request to work after retirement, or explicitly stated he did not intend to work in any capacity after retirement. AR 117-118, Declaration of Richard Goldberg ("Goldberg Decl.") ¶ 8, Rios Decl. ¶ 5-6. Accordingly, when Rios decided to retire early in September, 1994, he submitted a written request for permission to work as a "sales leader" marketing life and disability insurance. AR 117-118, Goldberg Decl. ¶ 8, Rios Decl. ¶ 5-6.

Rios's Pension Benefits Begin

In October, 1994, the pension department of the Plan informed Rios that his request to work as a sales leader had been approved, and reminded him that if he decided to change jobs or seek other employment, he "must notify the Pension Plan immediately." AR 121. In that same month, Rios began receiving early retirement pension benefits in the amount of $1904.54 per month, at which point he was again reminded to notify the Trustees of any change in employment in order to prevent incorrect payments. AR 122, Rios Decl. ¶ 5-6, Goldberg Decl. ¶ 9.

Rios did not communicate with the Trustees again until October 20, 1997, when he faxed a letter to the pension department indicating his interest in two positions at two different companies. AR 123-126. Rios attached two items to his letter: (1) A company description of Aidco, a telecommunications company whose services included "cabling systems installation and maintenance," and (2) a job advertisement, apparently from Claremont University, in which the only legible words read "new today" and "low voltage." AR 123-126.

On October 29, 1997, an assistant administrator of the Plan sent Rios a letter that asked for more information from Rios regarding the geographical scope of the Aidco position and also stated that the Claremont University job posting was illegible when transmitted by facsimile. AR 127. There is no record of any further correspondence from Rios regarding either job position. Goldberg Decl. ΒΆ 14. However, Rios testified in July, 2005 that he had worked at Aidco from October, 1997 to July, 2001. AR 17-18, Rios ...


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