United States District Court, E.D. Michigan, Southern Division
R.
Steven Whalen Magistrate Judge.
OPINION AND ORDER GRANTING DEFENDANT'S MOTION FOR
SUMMARY JUDGMENT [11] AND DENYING PLAINTIFF'S MOTION FOR
SUMMARY JUDGMENT [10]
LAURIE
J. MICHELSON UNITED STATES DISTRICT JUDGE.
Steven
Winn was a longtime employee of McLaren Health. And so he
earned a pension through the McLaren Employees' Pension
Plan. Steven elected to receive his pension in the form of a
joint and survivor 50% annuity-a financial product
guaranteeing a monthly income spread over two lives. For a
three-month period, Steven and his wife, Sandra Winn,
received checks amounting to just over $2, 300 per month. But
then Steven died. And after that, consistent with a joint and
survivor 50% annuity, Sandra began receiving monthly checks
totaling just over $1, 100 per month. After four years of
receiving $1, 100 per month, Sandra contested what she
thought was the Pension Plan's decision to cut her
monthly benefits. Sandra believed the timing of Steven's
death, coupled with specific language in the pension plan,
entitled her to $2, 300 each month.
Eventually,
the administrator decided against her, and she filed this
suit to contest that decision. Relying on their respective
interpretations of the administrative record, both sides move
for summary judgment. For the reasons that follow, the
administrator's decision was not arbitrary and
capricious.
I.
McLaren's
Employees' Pension Plan provided a few different default
distribution methods for the pension Steven Winn earned. For
married pensioners like Steven, the default method was a
qualified joint and survivor annuity amounting to the
actuarial equivalent of a single life annuity. (ECF No. 9,
PageID.369.) In layman's terms, an annuity provides a
guaranteed income over a period of time in exchange for an
investment. See Ron Lieber, The Simplest Annuity
Explainer We Could Write, N.Y. Times, Dec. 15, 2018, at
¶ 1. And a joint and survivor annuity allows a married
couple to extend the value of one spouse's pension over
the course of two lives (i.e. Steven's wife, Sandra,
would continue to receive monthly checks even after
Steven's death).
Important
to this case, the pension plan allowed Steven to depart from
the default distribution method, so long as Sandra consented.
(Id. at PageID.369.) Departing from the default
method required Steven to formally elect an optional annuity
from a menu of choices. (Id. at PageID.369, 409.)
According to the plan, the menu of optional annuities were
all equivalent (actuarially) to the default method. (ECF No.
9, PageID.369.) And the optional annuities included a joint
and survivor 50% annuity. (Id. at PageID.369.) Joint
and survivor 50% annuities allow a married couple to receive
a fixed sum of money each month while both are alive, but
when one of them dies, the surviving spouse receives half the
fixed amount per month.
Steven
elected a retirement date of November 1, 2012. (ECF No. 9,
PageID.420.) But the parties dispute whether he actually
retired on that date. (Compare ECF No. 10,
PageID.426 with ECF No. 3, PageID.9.) In any event,
on December 12, 2012, Steven and Sandra elected to depart
from the default distribution method. (ECF No. 9,
PageID.420.) On that date, Steven and Sandra opted to receive
Steven's pension in the form of a joint and survivor 50%
annuity coupled with a lump sum. (Id. at
PageID.409-410.) Again, in layman's terms, Steven and
Sandra chose to receive a higher amount per month while both
were alive, but agreed that when one of the two died, the
survivor would receive half that amount per month (plus a
lump sum payment).
Because
Steven and Sandra changed their election in December, they
did not receive their first check until January 22, 2013.
(ECF No. 9, PageID.420.) And that first check covered
November, December, and January, at a rate of $2, 305.43 per
month. (Id.) However, Steven died on January 17,
2013. (Id.) So beginning with February 2013, Sandra
started to receive checks in the amount of $1, 152.72 per
month. (Id.) And she received a lump sum payment of
just over $97, 000. (Id.)
For
roughly four years, Sandra received monthly checks in the
amount of $1, 152.72. But in 2017, she challenged whether the
pension plan should have been paying her $2, 305.43 all
along. (Id.) The plan administrator rejected
Sandra's challenge.
Soon
after, Sandra filed this lawsuit. She disputes the plan
administrator's decision. (ECF No. 1.) In time, the
administrative record was docketed (ECF No. 9), and the
parties filed cross motions for summary judgment. (ECF No.
10, 11).
II.
In an
ERISA case, a motion for summary judgment is not entirely on
all fours with a standard Rule 56(a) motion. See Hutson
v. Reliance Std. Life Ins. Co., 742 Fed.Appx. 113, 117
(6th Cir. 2018) (citing Wilkins v. Baptist Healthcare
Sys., Inc., 150 F.3d 609, 618-19 (6th Cir. 1998)
(Gilman, J., concurring)). When an ERISA plan accords the
plan administrator “discretionary authority to
interpret the terms of the plan and to determine benefits[,
]” at summary judgment the Court reviews the plan
administrator's decision using an “arbitrary and
capricious” standard. Glenn v. MetLife (Metro. Life
Ins. Co.), 461 F.3d 660, 666 (6th Cir. 2006) (citing
Firestone Tire & Rubber Co. v. Bruch, 489 U.S.
101, 111-15 (1989)). Arbitrary and capricious review is not
“a rubber stamp for the administrator's
determination[, ]” even if it is a deferential
standard. Elliott v. Metro. Life Ins. Co., 473 F.3d
613, 617 (6th Cir. 2006) (citing Jones v. Metro. Life
Ins. Co., 385 F.3d 654, 661 (6th Cir. 2004)). Under the
arbitrary and capricious standard, the plan
...