District Court Orders ChevronTexaco to Pay Benefits to Misclassified Employees.

In What's New in ERISA Litigation?, What's New in the Courts by gravierhouseLeave a Comment

In a class action filed in 2000 on behalf of former Texaco employees who had been hired by and through third-party staffing agencies, Judge Parker initially dismissed claims for benefits as time-barred, but found that breach of fiduciary duty claims could proceed. [127 F.Supp.2d 443 (S.D.N.Y. 2001)] Electing to proceed on the merits first, the parties submitted cross-motions for summary judgment. Judge Swain, (who inherited the case upon Judge Parker’s appointment to the Second Circuit), held that the more favorable language in the Formal Plan Text took precedence over the more restrictive language in the Summary Plan Descriptions. Because the plan administrator had relied upon the SPDs in denying eligibility, the court remanded to the new plan administrator to interpret the Plans. [308 F.Supp.2d 289 (S.D.N.Y. 2004)] Following remand, the parties again submitted the case on cross-motions for summary judgment. Judge Swain held, first, that claims for benefits under the Plans as amended January 1, 1995, were not time-barred under the borrowed six-year limitations period. The Court then held that the denial of benefits was, in fact, an abuse of discretion, and that the plaintiffs were eligible under the plans. The determination of benefits was remanded to an independent fiduciary, and a status conference was scheduled in April of 2009 to address the class action aspects of the case. Schultz, et al v. Stoner, et al, No.00-439, 2009 WL 455163 (S.D.N.Y. Feb. 24, 2009).

[Note – Stephen J. Herman serves as lead counsel for the paintiffs.]

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