United States District Court, E.D. Michigan, Southern Division
CORINNE M. CHABOREK, Plaintiff,
FORD COMPONENT SALES LLC, Defendant.
ORDER GRANTING DEFENDANT'S MOTION FOR JUDGMENT ON
THE ADMINISTRATIVE RECORD AND DENYING PLAINTIFF'S
TERRENCE G. BERG UNITED STATES DISTRICT JUDGE
Corinne Chaborek claims that Defendant Ford Component Sales
improperly denied her benefits under an employee
profit-sharing plan governed by the Employee Retirement
Income Security Act (“ERISA”). Plaintiff
initially filed a Complaint in Wayne County Circuit Court
alleging breach of contract, unjust enrichment, promissory
estoppel, and quantum meruit. ECF No. 1. Defendant removed
the case to federal court where ERISA governs adjudication of
the parties' dispute. Id. Plaintiff does not
contest federal jurisdiction over the matter. Plaintiff's
Reply to Defendant's Response to Plaintiff's Motion
for Judgment on the Administrative Record, ECF No. 12
PageID.249. For the reasons below, Defendant's Motion for
Judgment is GRANTED and Plaintiff's
Cross-Motion is DENIED.
worked for Defendant Ford Components for over ten years, from
August 2, 2002 until January 6, 2014. During 2013, Plaintiff
participated in a “profit-sharing plan.” The
profit-sharing plan is an employee pension plan subject to
the requirements of ERISA. Under the Plan, 50% of the
profit-sharing award goes to the employee's savings plan
(a 401(k) account), and 50% is awarded as a cash bonus. The
parties agree that Plaintiff received the savings plan
portion of her benefit for 2013. Response to Defendant's
Motion for Judgment, ECF No. 9 PageID.132. But Plaintiff
contends that she is also entitled to the cash portion of the
profit-sharing plan that she earned during her final
Performance Period, ending on December 21, 2013, in the
amount of$18, 379.89.
terms of the Plan allow Defendant “full power and
authority to interpret, administer, modify, suspend, and
terminate the Plan” and permits Defendant to delegate
that authority. The Plan terms also state that any
participant “who terminates employment or is terminated
by the Company for any reason other than Company-approved
retirement, disability or death prior to the payment by the
Company of the Award shall not be eligible for an Award under
the Plan.” ECF No. 5 PageID.43.
took medical leave under the Family Medical Leave Act
(“FMLA”) beginning on October 1, 2013. That leave
was set to expire on December 23, 2013. Prior to expiration,
on December 16, 2013, Plaintiff extended her leave by
submitting a note from her physician designating January 6,
2014 as her new return-to-work date. Defendant claims-and the
administrative record supports-that despite the note
indicating she would return on January 6, 2014, Plaintiff
made no attempt to communicate with her employer until her
attorney contacted Defendant on March 20, 2018.
Plaintiff did not return to work on January 6, 2014 as
scheduled, her FMLA leave expired. Defendant states that
Plaintiff was terminated as “voluntary quit.” On
February 3, 2014, Defendant sent Plaintiff a letter regarding
the termination of Plaintiff's employment. This letter
says that Plaintiff could still collect her award under the
Plan if she agreed to sign a waiver and release agreement
releasing any claims relating to her employment or
termination. Administrative Record, ECF No. 5 PageID.55. The
letter also requested that Plaintiff return company property
in her possession. Id. Defendant maintains that the
Plan did not require Defendant to pay Plaintiff the award,
but Defendant offered to do so provided that she sign the
waiver and release of claims. Although Plaintiff claims that
Defendant issued, but did not send, a check for her award,
Defendant maintains that it has never issued a check because
Plaintiff did not sign the waiver and release of claims and
did not return the company property in her possession. The
record contains no evidence of an issued check for the cash
portion of the benefit.
issues presented in Plaintiff's Cross-Motion for Judgment
receive different standards of review. First, the Court
reviews de novo “the legal question of whether
the procedure employed by a plan administrator in terminating
benefits meets the requirements of § 1133.”
Houston v. UNUM Life Ins. Co. of Am., 246 Fed.Appx.
293, 299 (6th Cir. 2007) (citing McCartha v. Nat'l
City Corp., 419 F.3d 437, 444 (6th Cir. 2005).
Therefore, on Plaintiff's first claim in her
Cross-Motion, that Defendant's benefit and appeal denials
were procedurally deficient under 29 U.S.C. § 1133, the
Court employs de novo review.
disagree regarding which standard of review applies to the
substantive benefit determination, the second claim
in Plaintiff's Cross-Motion. Plaintiff argues that the
Plan administrator's denial of her benefit should be
reviewed de novo under McCartha, 419 F.3d
at 444. Defendants argue the denial of benefits should be
reviewed for whether it was arbitrary and capricious under
Firestone Tire and Rubber Company v. Bruch, 489 U.S.
101, 115 (1989).
McCartha, a denial of benefits is reviewed de
novo “unless the benefit plan gives the
administrator or fiduciary discretionary authority to
determine eligibility for benefits or to construe the terms
of the plan” in which case the administrator's
decision is affirmed if it is “rational in light of the
plan's provisions.” McCartha, 419 F.3d at
441 (citing Firestone Tire & Rubber Co. v.
Bruch, 489 U.S. 101, 115 (1989); Marks v. Newcourt
Credit Group Inc., 342 F.3d 444, 456-57 (6th Cir. 2003)
(internal quotations omitted)); accord Wilkins v. Baptist
Healthcare Sys., 150 F.3d 609, 616 n.4 (6th Cir. 1998);
Yeager v. Reliance Standard Life Ins. Co., 88 F.3d
376, 380 (6th Cir. 1996); Pransch v. The Guardian Life
Insurance Co. of America, No. 16-10723, 2017 WL 4054174,
at *1 (E.D. Mich. Sept. 14, 2017).
argues that the Profit-Sharing Incentive Plan (“the
Plan”), ECF No. 5 PageID.43, grants Defendant
discretionary authority to determine eligibility for benefits
and that the Court should review its decision under the
arbitrary and capricious standard. The Court agrees.
Plan lists the Ford Component Sales Compensation Committee of
the Board of Directors of the Company as the Plan
Administrators. Id. The Plan also explicitly states
that the Administrators “shall have full power and
authority to interpret, administer, modify, suspend, and
terminate the Plan.” Id.
language clearly confers discretion on the administrators,
thereby warranting arbitrary and capricious review. See
Marks v. New-court Credit Group, Inc., 342 F.3d 444, 457
(6th Cir. 2003) (applying arbitrary and capricious review
where plan language gave the plan admin- istrator the power
to “make the rules and regulations necessary to
administer the Plan and . . . interpret the ...