Gary Romanchuk v. Scuf & Cwuf Joint Benefit Fund

• Court: Court of Appeals for the Ninth Circuit
• Decided: February 10, 2021
• Docket: 17-56069
• Status: Unpublished

Opinion

NOT FOR PUBLICATION FILED UNITED STATES COURT OF APPEALS FEB 10 2021 MOLLY C. DWYER, CLERK U.S. COURT OF APPEALS FOR THE NINTH CIRCUIT

GARY M. ROMANCHUK, No. 17-56069

Plaintiff-Appellee, D.C. No. 2:15-cv-08180-AB-KS v.

BOARD OF TRUSTEES OF THE MEMORANDUM* SOUTHERN CALIFORNIA UNITED FOOD AND COMMERCIAL WORKERS UNIONS AND FOOD EMPLOYERS JOINT PENSION TRUST FUND; et al.,

Defendants-Appellants.

GARY M. ROMANCHUK, No. 17-56208

Plaintiff-Appellant, D.C. No. 2:15-cv-08180-AB-KS v.

BOARD OF TRUSTEES OF THE SOUTHERN CALIFORNIA UNITED FOOD AND COMMERCIAL WORKERS UNIONS AND FOOD EMPLOYERS JOINT PENSION TRUST FUND; et al.,

Defendants-Appellees.

Appeal from the United States District Court

* This disposition is not appropriate for publication and is not precedent except as provided by Ninth Circuit Rule 36-3. for the Central District of California Andre Birotte, Jr., District Judge, Presiding

Argued and Submitted September 29, 2020 Pasadena, California

Before: RAWLINSON, BENNETT, and BADE, Circuit Judges.

The Board of Trustees of the Southern California United Food and

Commercial Workers Unions and Food Employers Joint Pension Trust Fund

(“Trustees”) appeals the district court’s denial of the Trustees’ motion for summary

judgment and remand order. Plaintiff Gary Romanchuk cross-appeals the remand

order and the district court’s decision not to consider extrinsic evidence in

interpreting the Joint Pension Plan (“Plan”).

We dismiss for lack of jurisdiction the Trustees’ appeal of the denial of

summary judgment on the breach of fiduciary duty and equitable estoppel claims

because this Court lacks jurisdiction to consider an appeal of a non-final

interlocutory order denying summary judgment. See 28 U.S.C. § 1291; Demshki v.

Monteith, 255 F.3d 986, 988 (9th Cir. 2001); Rodriguez v. Lockheed Martin Corp.,

627 F.3d 1259, 1264 (9th Cir. 2010) (“[A] denial of summary judgment on the basis

of an issue of material fact is ordinarily not a final judgment and not a basis for an

interlocutory appeal.”).

We have jurisdiction over the district court’s order remanding to the Plan

administrator (the Trustees) pursuant to 28 U.S.C. § 1291. See Banuelos v. Constr.

2 Laborers’ Tr. Funds for S. Cal., 382 F.3d 897, 903 (9th Cir. 2004). We affirm in

part and vacate in part the district court’s remand order, and remand for further

proceedings. The district court’s remand order instructs the Trustees to construe the

Grandfather Clause in accordance with the district court’s interpretation, which

would likely make Romanchuk eligible for benefits and resolve this claim against

the Trustees. We review de novo the district court’s “choice and application of the

standard of review to decisions by ERISA fiduciaries.” Pannebecker v. Liberty Life

Assurance Co., 542 F.3d 1213, 1217 (9th Cir. 2008).

The district court correctly determined that the applicable standard for

reviewing the Trustees’ decision was abuse of discretion. The Plan plainly confers

discretion on the Trustees. See Vizcaino v. Microsoft Corp., 120 F.3d 1006, 1009

(9th Cir. 1997) (en banc) (“[W]hen reviewing the decision of a plan administrator

who has discretion, the exercise of that discretion is reviewed . . . for abuse of

discretion.” (internal quotation marks and citation omitted)).

However, the district court erred in construing the Grandfather Clause based

on the litigation posture of the Trustees’ counsel, which is not entitled to the same

deference afforded to the Trustees’ exercise of discretion. See Jebian v. Hewlett-

Packard Co. Emp. Benefits Org. Income Prot. Plan, 349 F.3d 1098, 1104 (9th Cir.

2003) (“Decisions made outside the boundaries of conferred discretion are not

exercises of discretion.”). The Trustees have not yet interpreted the Grandfather

3 Clause, as Romanchuk did not seek application of the Grandfather Clause during the

administrative review process. Instead, the meaning of the Grandfather Clause was

raised for the first time during judicial review. In such a case, the appropriate course

is to remand Romanchuk’s claim for disability retirement benefits to the Plan

administrator for consideration of the application of the Grandfather Clause as “we

should not allow ourselves to be seduced into making a decision which belongs to

the plan administrator in the first instance.” Vizcaino, 120 F.3d at 1013 (opinion of

Fernandez, J.); see also id. at 1022 (O’Scannlain, J., concurring in part and

dissenting in part) (“[T]he administrator must be given an opportunity to interpret

the meaning of plan provisions before the court rules.”).1 The district court’s order,

which instructs the Trustees to apply the Grandfather Clause according to the court’s

construction, limits the Trustees’ power to make the initial decision on the issue.

Thus, we vacate the order.

That said, we understand that this case has already proceeded for many years,

during which time Romanchuk has not received the disability benefits he seeks.

Because there may be further appeals, we would be remiss if we failed to note the

logic of the district court’s reasoning, including as to superfluousness.2 The answers

1 We also note the lack of any “issue exhaustion” requirement in the Plan. See Vaught v. Scottsdale Healthcare Corp. Health Plan, 546 F.3d 620, 631–33 (9th Cir. 2008). 2 “If, as Defendants argue, a right does not become non-forfeitable until a participant meets all eligibility requirements, it is hard to see any circumstance in which the

4 to the court’s questions provided by counsel for Romanchuk on this topic (for

example, that the Grandfather Clause would not be superfluous if ERISA were

repealed, Oral Argument at 11:32–12:07) add to our concern. Counsel also noted

during argument, again in response to the court’s questions, that the Trustees may

have the discretion to grant benefits without construing the Grandfather Clause. Oral

Argument at 40:29–41:05. Nonetheless, we leave it to the Trustees to construe the

Grandfather Clause in the first instance.

Because we vacate the district court’s order, we dismiss the substantive

challenges to the court’s construction of the Grandfather Clause as moot. We also

dismiss as moot Romanchuk’s cross-appeal of the district court’s failure to consider

extrinsic evidence.

The district court is directed to remand this case to the Trustees for

proceedings consistent with this memorandum disposition. Costs on appeal are

awarded to Plaintiff.

DISMISSED IN PART, AFFIRMED IN PART, REMANDED IN PART.

Grandfather Clause would apply because a participant would already be entitled to the benefit. Similarly, the plain language of the Grandfather Clause cuts against imputing the definition ‘non-forfeitable rights’ to the term ‘vested rights’ because it would render a portion of the Grandfather Clause superfluous.” See Romanchuk v. Bd. of Trs. of the S. Cal. United Food & Commercial Workers Joint Pension Tr. Fund, No. CV 15-08180-AB (KS), 2017 WL 4679269, at *18 (C.D. Cal. June 29, 2017).