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The Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C.S. § 1001-1461, defines an "employee pension benefit" plan as any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that by its express terms or as a result of surrounding circumstances such plan, fund, or program provides retirement income to employees. 29 U.S.C.S. § 1002(2)(A)(i).
Defendants Schwegmann were an employer, a pension plan, two individuals, a trust, and an insurer. Defendant implemented a grocery voucher plan. Under this plan, defendant issued vouchers to plaintiff retirees, and these vouchers could then be used in lieu of cash to purchase goods in SGSM stores. It is this voucher plan which is the subject of this lawsuit. Plaintiffs John Musmeci et al., were former employees of the defendant, filed this suit under ERISA and Louisiana state law claiming that they were vested in a pension benefit plan and that they were adversely affected after the termination of the voucher plan when defendant sold its business. The district court ruled in favor of plaintiffs holding that a grocery voucher plan established by the defendant was a pension benefit plan under the Employee Retirement Income Security Act of 1974, 29 U.S.C.S. §§ 1001-1461. The district court also held that the plaintiff class was entitled to monetary relief and that self-insured retention in the insured's policy covering the defendant employer's liability for employee benefits incidents could be applied once to the class's claims collectively. The appellate court agreed with the district court except with respect to the insurer. Defendants appealed.
Was the voucher plan a benefit plan under the Employee Retirement Income Security Act of 1974, 29 U.S.C.S. §§ 1001-1461?
The appellate court agreed with the district court’s decision except with respect to the insurer. The appellate court held that the district court correctly concluded that the vouchers constituted income and that the voucher plan was governed by ERISA, and one of the individuals could have been liable as a fiduciary even if he was not the class's employer under a veil-piercing theory. However, the appellate court concluded that the SIR in the insurer's policy applied to each class member's claim. Because no individual claim exceeded the SIR, the appellate court vacated the judgment against the insurer. "Claim" as used in the SIR was not ambiguous as it referred to an individual demand or cause of action asserted by a third party against the insured. Because each of the class members had a separate cause of action and could have filed an individual lawsuit for recovery of pension benefits, the SIR applied separately to each of their claims.