Lamb v. Nextel Communications of Mid-Atlantic, Inc. , 429 F. App'x 337 ( 2011 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 10-2252
EDWARD LAMB,
Plaintiff – Appellant,
v.
NEXTEL COMMUNICATIONS OF THE MID-ATLANTIC, INCORPORATED; NEXTEL
COMMUNICATIONS, INCORPORATED; NEXTEL COMMUNICATIONS,
INCORPORATED CHANGE OF CONTROL RETENTION BONUS AND SEVERANCE PAY
PLAN AND PLAN TRUSTEES,
Defendants – Appellees.
Appeal from the United States District Court for the Eastern
District of Virginia, at Newport News. Rebecca Beach Smith,
District Judge. (4:09-cv-00149-RBS-TEM)
Submitted: April 28, 2011 Decided: May 20, 2011
Before NIEMEYER, MOTZ, and WYNN, Circuit Judges.
Affirmed by unpublished per curiam opinion.
James H. Shoemaker, Jr., PATTEN, WORNOM, HATTEN & DIAMONSTEIN,
LC, Newport News for Appellant. Adam H. Garner, MCGUIREWOODS,
LLP, Baltimore, Maryland; Ronda B. Esaw, MCGUIREWOODS, LLP,
McLean, Virginia, for Appellees.
Unpublished opinions are not binding precedent in this circuit.
PER CURIAM:
Edward Lamb appeals the district court’s order
adopting the magistrate judge’s report and recommendation and
denying both parties’ motions for summary judgment, entering
judgment for Nextel Communications, and dismissing his action
for benefits under Nextel’s Change of Control Retention Bonus
and Severance Pay Plan (“the Plan”).1 On appeal, Lamb argues
that the district court erred in applying an abuse of discretion
standard of review to the Plan administrator’s denial of
benefits and finding reasonable the administrator’s
determination that Lamb was ineligible for benefits. Finding no
reversible error, we affirm.
Judicial review of an ERISA plan administrator’s
decision is generally de novo unless the plan provides
otherwise. Metro. Life Ins. Co. v. Glenn, 554 U.S. 105, 111
(2008). When the plan language grants the administrator
discretionary authority to determine eligibility for benefits,
however, review is conducted under an abuse-of-discretion
standard, even if the plan gives discretion to an administrator
operating under a conflict of interest. Id.
1
The Plan is administered by Nextel, through its Plan
Administration Committee (“the Committee”). It is governed by
the Employment Retirement Income Security Act of 1974 (“ERISA”),
29 U.S.C.A. §§ 1001-1461 (West 2008 & Supp. 2010).
2
Here, the magistrate judge correctly applied the abuse
of discretion standard. The Plan explicitly states that Nextel,
through the Committee, “shall promulgate any rules and
regulations it deems necessary in order to carry out the
purposes of the Plan or to interpret the terms and conditions of
the Plan.” It also states that Nextel, through the Committee,
“shall determine the rights of any employee of the Company to
any Retention Bonus or Severance Compensation.” We hold that
the foregoing provisions are sufficient to confer discretionary
authority on Nextel and, thus, the application of the abuse of
discretion standard was proper. See Rego v. Westvaco Corp., 319
F.3d 140, 147 (4th Cir. 2003) (holding that the administrator
had discretionary authority to make eligibility determinations
where the plan provided that the administrator should “adopt
such procedures and rules as he deems necessary or advisable to
administer the Plan” and that the administrator was responsible
for “the determination of participants’ eligibility to receive
benefits”).
“In an appeal under ERISA, we review a district
court’s decision de novo, employing the same standards governing
the district court’s review of the plan administrator’s
decision.” Williams v. Metro. Life Ins. Co., 609 F.3d 622, 629
(4th Cir. 2010). We therefore review the district court’s
decision de novo and the plan administrators’ decision for abuse
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of discretion. See Champion v. Black & Decker (U.S.) Inc., 550
F.3d 355, 360 (4th Cir. 2008). In the ERISA context, “the
standard equates to reasonableness: We will not disturb an ERISA
administrator’s discretionary decision if it is reasonable, and
will reverse or remand if it is not.” Evans v. Eaton Corp. Long
Term Disability Plan, 514 F.3d 315, 322 (4th Cir. 2008). When
determining whether an administrator’s decision was reasonable,
we consider:
(1) the language of the plan; (2) the purposes and
goals of the plan; (3) the adequacy of the materials
considered to make the decision and the degree to
which they support it; (4) whether the fiduciary’s
interpretation was consistent with other provisions in
the plan and with earlier interpretations of the plan;
(5) whether the decisionmaking process was reasoned
and principled; (6) whether the decision was
consistent with the procedural and substantive
requirements of ERISA; (7) any external standard
relevant to the exercise of discretion; and (8) the
fiduciary’s motives and any conflict of interest it
may have.
Booth v. Wal-Mart Stores, Inc. Assocs. Health & Welfare Plan,
201 F.3d 335, 342-43 (4th Cir. 2000).
Nextel denied Lamb benefits because it concluded that
he voluntarily withdrew from the company, making him ineligible
for the second half of his retention bonus and severance
compensation under the Plan. Lamb disputes this, arguing that
he was terminated and, therefore, is entitled benefits under the
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Plan.2 Upon consideration of the above factors, we hold that the
district court did not err when it found reasonable the
administrator’s denial of Plan benefits. Because the
administrator’s finding that Lamb was offered continued
employment with Nextel was not unreasonable, its conclusion that
Lamb’s rejection of the offer effected his voluntary withdrawal
under the Plan did not constitute an abuse of discretion.
Accordingly, we affirm the district court’s order. We
dispense with oral argument because the facts and legal
contentions are adequately presented in the materials before
this court and argument would not aid the decisional process.
AFFIRMED
2
As a threshold matter, Lamb argues that the district court
erred in holding that the Plan makes eligible for the second
half of the retention bonus only those employees who were
involuntarily terminated because the retention bonus provision
does not explicitly exclude employees who voluntarily withdrew.
In light of the Plan and Summary Plan Description language,
however, we conclude that the district court correctly held that
an employee who voluntarily withdraws is not eligible for the
second half of the retention bonus.
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