United States District Court, Central District of California
ORDER GRANTING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT
Honorable Josephine L. Staton United States District Judge
This action is brought pursuant to the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001 et seq., by plaintiff Mark Gale against defendants EIX Severance Plan for Nonrepresented Employees (the "Plan") and California Edison Company Benefits Committee (the "Committee"). The Plan is an unfunded employee welfare benefit plan governed by ERISA. The Committee is the Plan's administrator. The Plan's sponsor is the Southern California Edison Company ("SCE"), Plaintiff's former employer. Plaintiff alleges that Defendants abused their discretion in denying him severance benefits under the Plan.
Defendants have moved for summary judgment seeking to dismiss Plaintiff's declaratory judgment action wherein Plaintiff claims he is entitled to Plan benefits under 29 U.S.C. § 1132(a)(1)(B). (Motion, Doc. 21.) Plaintiff has opposed the Motion (Opp., Doc. 26) and Defendants have replied. (Reply, Doc. 28.) Having reviewed the papers and supporting documentation submitted by the parties, and taken the matter under submission, Defendants' decision denying severance benefits to Plaintiff is AFFIRMED.
A. The Severance Program
SCE operates the San Onofre Nuclear Generating Station ("SONGS"), where Plaintiff previously worked. (DRSUF ¶ 1.) The SONGS 2012 Employee Requested Severance Program ("SERSP") provided severance benefits to eligible employees who were accepted for participation. (See Id . ¶ 2.) SERSP was offered in the sole discretion of SCE, which administered the SERSP and interpreted its terms. (See Id . ¶3.) SERSP was made available in accordance with the terms of the Plan and the severance benefits provided by SERSP were the same as those offered under the Plan. (See Id . ¶¶ 4-5.) SCE appointed an internal Committee, made up of SCE employees, to administer the Plan at its sole discretion. (See Id . ¶ 10-11.)
SCE, not the Committee, had the sole discretion whether to accept any employee's application to participate in the SERSP. (See Id . ¶¶ 14, 26.) To be eligible for benefits under the Plan through the SERSP, an individual had to be a SONGS employee at the time the SERSP was announced on September 24, 2012. (See Id . ¶ 12.) In addition, an employee had to have been terminated from employment while the Plan was in effect. (See Id . ¶ 20.) Employees also had to apply to participate in the SERSP within the application period of September 27, 2012 to October 12, 2012. (See Id . ¶¶ 13, 40.)
Another requirement for eligibility was that an employee had to be designated as "Surplus" by the Participating Employer, here SCE. (See Id . ¶ 19.) To be designated as "Surplus, " an employee must have been selected for termination by his Participating Employer as part of, inter alia, a reduction in force. (See Id . ¶ 21.) Furthermore, the Plan allowed for the establishment of a "Window Program" where employees could apply for benefits conditioned on the employee's voluntary termination of employment by being designated as Surplus. (See Id . ¶ 22.) SCE retained the sole discretion to designate any employee as Surplus and to determine any employee's eligibility to apply for benefits under the Window Program. (See Id . ¶¶ 23, 27.) Under the SERSP, employees who already announced their intended retirement date before the SERSP was announced on September 24, 2012, were ineligible to participate in the SERSP. (See Id . ¶ 16.)
On August 20, 2012, SCE announced by email, and by posting on the internal SONGS portal, that it would be implementing a reduction-in-force in which approximately 730 SONGS employees would be laid off. (See Id . ¶¶ 35, 84.) Plaintiff subsequently attended an All-Hands-Meeting where SCE management announced that it would not be offering a severance package to those terminated employees. (See Id . ¶ 85.) On September 4, 2012, when Plaintiff was off-site on unpaid leave, SCE announced that it was considering whether to offer a voluntary severance program. (See Id . ¶¶ 94-95.) On September 24, 2012, SCE announced to all employees that it would indeed be offering a voluntary severance program. (See Id . ¶ 99.) SCE pays the full cost of Plan benefits from operating income. (See Id . ¶ 73.)
B. Plaintiffs Retirement
SCE utilizes a Benefits Commencement Package ("BCP") in which employees log on to the EIX Benefits Website and check a box to receive a retirement pension package. (See Id . ¶¶ 30, 76.) Employees can withdraw notice of retirement at any time prior to receiving benefits, without penalty, by logging into the BCP and un-checking the box. (See Id . ¶ 78.) Under SCE guidelines, an employee's request to receive pension benefits will be revoked automatically unless the employee contacts the Employee Information Center ("EIC") and gives formal notice of retirement. (See Id . ¶ 79.)
On July 18, 2012, Plaintiff logged into the BCP, checked the box, and indicated a benefits commencement date of October 1, 2012. (See Id . ¶ 11.) On July 30, 2012, Plaintiff contacted the EIC and formally requested October 1, 2012 as his benefits commencement date and September 30, 2012 as his last day of work. (See Id . ¶ 83.) On or about September 2, 2012, Plaintiff contacted the EIC to change the last day of his employment from September 30, 2012 to September 4, 2012. (See Id . ¶¶ 36-37, 90.) Plaintiff could have rescinded his retirement election on September 4, 2012, but he chose not to do so. (See Id . ¶ 38.)
C. Denial of Benefits
The Plan confers discretionary authority on the Committee to determine eligibility for Plan benefits in accordance with the terms of the Plan. (See Id . ¶ 72.) The Committee has delegated day-to-day administrative responsibilities, such as deciding claims at the initial level, to the Benefits Strategy and Operations segment of the SCE Human Resources Department ("HR Operations"). (See Id . ¶ 29.) The Committee, however, reviews claims for benefits that are denied in whole or in part. (See Id . ¶ 28.)
Between September 2012 and January 2013, Plaintiff repeatedly requested to be included in the SERSP. (See Id . ¶¶41, 102.) On March 11, 2013, Plaintiff's initial requests for SERSP benefits were denied in a letter from the EIC Supervisor. (See Id . ¶42.) That letter explained that Plaintiff was denied participation in the SERSP because: (1) he was not a full-time employee and was not designated as ...