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Bator v. Dist. Council 4, Graphic Communs., IBT

United States Court of Appeals for the Seventh Circuit

February 12, 2020, Argued; August 27, 2020, Decided

No. 19-2626


Kanne, Circuit Judge. Plaintiffs Donald Bator, Edmond W. Moses, Christopher O'Malley, Michael Anthony Pappa, and Rogelio Jimenez, Jr. are [*2]  former members of a union, Local 458-M.1 The Union participated in an employee-benefit pension plan administered by a Board of Trustees. In 2014, the Plaintiffs discovered the financial health of their pension plan was deteriorating. Several years later, the Plaintiffs sued the Trustees and the Union under the Employee Retirement Income Security Act of 1974 ("ERISA") for a breach of fiduciary duty. See 29 U.S.C. § 1132(a)(2). The Plaintiffs allege the Defendants' actions and inaction resulted in an underfunding of their pensions. The district court dismissed the case for failure to state a claim under ERISA. We affirm.

I. Background

The Plaintiffs are current employees of Bell Litho Inc., a graphic-communications company, and former members of Local 458-M Graphic Communications International Union. The Plaintiffs participated in an employee-funded benefit plan: the Inter-Local Pension Fund of the Graphic Communications Conference of the International Brotherhood of Teamsters. Unlike many defined-benefit plans, this pension plan is completely funded by contributions from the members of about sixty-nine unions; their employers do not contribute to or participate in the plan's governance. Instead, the plan is [*3]  governed by Trust Indenture documents and administered by a Board of Trustees.2

The Trust Indenture documents provide that the plan's members must contribute a fixed amount to the plan each week, unless a member's union has set a different contribution amount (we'll have more to say about this later). In 2008, the Plaintiffs' union, 458-M, voted to increase its members' contributions to the plan from 6% to 8% of their weekly wages.

Several years later, in January 2014, the Trustees notified plan participants that the plan's financial health was deteriorating. So, the Plaintiffs and others petitioned Local 458-M to reduce their compelled-contribution rate. The Union denied that request.

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2020 U.S. App. LEXIS 27339 *

DONALD BATOR, et al., Plaintiffs-Appellants, v. DISTRICT COUNCIL 4, GRAPHIC COMMUNICATIONS CONFERENCE, IBT, et al., Defendants-Appellees.

Prior History:  [*1] Appeal from the United States District Court for the Northern District of Illinois, Eastern Division. No. 18-cv-1770 — John J. Tharp, Jr., Judge.

Bator v. Bd. of Trs., 2019 U.S. Dist. LEXIS 106448, 2019 WL 2616988 (N.D. Ill., June 26, 2019)


fiduciary, pension, membership, segments

Civil Procedure, Appeals, Standards of Review, De Novo Review, Defenses, Demurrers & Objections, Motions to Dismiss, Failure to State Claim, Pensions & Benefits Law, Judicial Review, Arbitrary & Capricious Review, De Novo Standard of Review, Business & Corporate Compliance, ERISA, Fiduciaries, Named Fiduciary Appointment & Obligations, Fiduciary Responsibilities, Plan Administration, Adherence to Plan, Civil Litigation, Causes of Action, Breach of Fiduciary Duty, Disqualification, Delegation of Duties, Plan Administration, Plan Amendments, Governments, Fiduciaries, Appellate Briefs, Reviewability of Lower Court Decisions, Preservation for Review