Winn v. McLaren Employees' Pension Plan

          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 ...