Fulghum v. Embarq Corporation

Plaintiffs-appellants represent a class of retirees formerly employed by Sprint-Nextel Corporation, Embarq Corporation (or a predecessor and/or subsidiary company of either Embarq or Sprint). Plaintiffs sued after Defendants altered or eliminated health and life insurance benefits for retirees. Plaintiffs asserted Defendants: (1) violated the Employee Retirement Income Security Act of 1974 (ERISA) by breaching their contractual obligation to provide vested health and life insurance benefits; (2) breached their fiduciary duty by, inter alia, misrepresenting the terms of multiple welfare benefit plans; and (3) violated the Age Discrimination in Employment Act (ADEA) and applicable state laws by reducing or eliminating the same benefits. Defendants moved for summary judgment on the breach of fiduciary duty claims, the ADEA claims, the state-law age discrimination claims, and some of the contractual vesting claims. The district court granted Defendants’ motions in part and Plaintiffs obtained a Rule 54(b) certification. The Tenth Circuit concluded Defendants did not contractually agree to provide Plaintiffs with lifetime health or life insurance benefits and thus affirmed in part the grant of summary judgment as to the contractual vesting claims. To the extent the district court granted summary judgment against class members whose contractual vesting claims arise, in whole or in part, from summary plan descriptions (other than those identified in Defendants’ motion), the Court reversed the grant of summary judgment against those class members. The Court reversed the district court’s dismissal of Plaintiffs’ breach of fiduciary duty claims brought pursuant to 29 U.S.C. 1132(a)(3) and reversed the dismissal of Plaintiffs’ remaining breach of fiduciary duty claims to the extent those claims were premised on a fraud theory. Finally, because Defendants’ decision to reduce or terminate the group life insurance benefit was based on a reasonable factor other than age, their actions did not violate the ADEA, and the Tenth Circuit affirmed the grant of summary judgment in favor of Defendants on those claims. View "Fulghum v. Embarq Corporation" on Justia Law