Giunta v. Mobil Corp Empl Plan

• Court: Court of Appeals for the Fifth Circuit
• Decided: April 10, 2003
• Docket: 02-41127
• Status: Unpublished

Opinion

United States Court of Appeals Fifth Circuit F I L E D UNITED STATES COURT OF APPEALS For the Fifth Circuit April 10, 2003

Charles R. Fulbruge III No. 02-41127 Clerk Summary Calendar

RICK L GIUNTA,

Plaintiff/Appellant,

VERSUS

MOBIL CORPORATION EMPLOYEE SEVERANCE PLAN,

Defendant/Appellee.

Appeal from the United States District Court For the Southern District of Texas (01-CV-677)

Before DAVIS, DUHÉ, and DEMOSS, Circuit Judges.

PER CURIAM:1

The issue in this appeal is whether the administrator of an

ERISA-governed employee welfare benefit plan correctly interpreted

its terms, and if not, abused his discretion in denying benefits to

the plaintiff.

Exxon Corporation and Mobil Corporation merged in 1999. The

Mobil Corporation Employee Severance Plan (“the Plan”), an ERISA-

1 Pursuant to 5th Circuit Rule 47.5, the court has determined that this opinion should not be published and is not precedent except under the limited circumstances set forth in 5th Circuit Rule 47.5.4. governed employee welfare benefit plan, provided among other things

severance packages for employees who resigned their positions for

good reason during a two year period following the merger. “Good

reason,” as defined in Section 1.12 of the Plan, included the

change of an employee’s principal place of employment to a location

more than 50 miles from the employee’s current place of employment

without the employee’s “written consent.”

Exxon Mobil implemented a policy whereby employees accepting

post-merger positions were asked to sign a form indicating their

acceptance. The form, which listed four choices and the effect of

each choice with regard to the availability of Plan benefits, was

referred to as the ABCD form.

Before the merger, Rick Giunta (“Giunta”) worked in New

Orleans, Louisiana, as an engineer for Mobil. Shortly after the

merger, Giunta accepted essentially the same position with Exxon

Mobil in New Orleans. In connection with this acceptance, Giunta

signed the ABCD form. About one month later, Exxon Mobil offered

Giunta a position in Houston, Texas. Giunta began work in Houston

several months later, but did not sign the ABCD form. He did,

however fill out and submit a relocation authorization form in

connection with the move to Houston. He also signed and submitted

claim forms for various relocation expenses, including a lump-sum

payment available only to employees who relocate. From early

March until mid-July, Giunta commuted to Houston to work each week

and lived in corporate housing.

2 After nearly five months of working in the Houston position,

Giunta left Exxon Mobil and went to work for Halliburton in

Houston. Giunta’s notice to Exxon Mobil of his pending departure

was written in terms of declining an offer to relocate. Exxon

Mobil informed Giunt that it understood his departure to be a

resignation.

Giunta sought severance benefits under the Plan, claiming

entitlement because he terminated his employment for “good reason,”

namely, relocation more than 50 miles away from his former

principal place of employment without his written consent. When

denied benefits, Giunta appealed, and the Plan Administrator

(“Administrator”) upheld the denial on appeal and on

reconsideration. The Administrator’s reasons included that Giunta

had consented to the relocation, as evidenced by his acceptance of

relocation funds, thereby eliminating “good reason” for his

departure. The Plan contends that the requirement for written

consent is satisfied by (1) the relocation authorization form

filled in and submitted by Giunta, as well as (2) the several

relocation expense reimbursement forms signed and submitted by

Giunta.

On cross-motions for summary judgment, the district court

granted summary judgment to the Plan and denied summary judgment to

Giunta, concluding that the Administrator’s interpretation of the

plan was legally correct and that the denial of benefits was not an

abuse of the Administrator’s discretion. Giunta appeals.

3 I.

We review the grant of summary judgment de novo, applying the

same standards as would the district court. Shipp v. McMahon, 234

F.3d 907, 911 (5th Cir. 2000). Summary judgment is appropriate if

the record reveals no genuine issue of material fact and the moving

party is entitled to judgment as a matter of law. Fed. R. Civ. P.

56(c).

Judicial review of benefit determinations by the administrator

of an ERISA-governed employee welfare benefit plan may involve two

parts. First, we consider whether the administrator’s

interpretation of plan provisions is legally correct. Wildbur v.

ARCO Chemical Co., 974 F.2d 631, 637 (5th Cir. 1992); Jordan v.

Cameron Iron Works, Inc., 900 F.2d 53, 56 (5th Cir. 1990). If the

administrator’s interpretation is legally correct, the inquiry ends

there. Chevron Chem. Co. v. Oil, Chem. & Atomic Workers Local 4-

447, 47 F.3d 139, 146 (5th Cir. 1995). A conclusion that the

administrator’s interpretation is legally incorrect requires

review of the administrator’s determination for abuse of

discretion. Duhon v. Texaco, Inc., 15 F.3d 1302, 1305 (5th Cir.

1994). Obligations imposed by the plan but not required by ERISA

are governed by contract law. Spacek v. Maritime Ass'n, 134 F.3d

283, 287 (5th Cir. 1998). In cases involving a potential conflict

of interest, the conflict is a factor in the abuse of discretion

inquiry. Vega v. National Life Ins. Servs, 188 F.3d 287, 296-97

(5th Cir. 1999).

4 In deciding whether the Administrator’s determination is

legally correct, we consider “(1) whether the administrator

provides a uniform construction of the plan; (2) whether the

interpretation is consistent with a fair reading of the plan; and

(3) whether the interpretation results in any unanticipated costs.”

Jordan, 900 F.2d at 56.

The Plan does not designate a specific means of providing

“written consent” to relocation, and the record reveals no fact

issue whether the Administrator interpreted “written consent” non-

uniformly. Giunta’s references to the situations of two other

employees fails to advance his position to the contrary. The

first, Keith Carwile, was allowed to decline after working in a new

location for two months, but his situation differs in that he never

executed a writing indicating his consent to relocate. The second,

Stephen Pease, consented to relocation in an email and was denied

benefits; thus his situation is consistent with the notion that

writings other than the ABCD form can constitute written consent.

In sum, these situations tend to demonstrate uniformity, rather

than non-uniformity, in the Administrator’s construction of

“written consent.”

Giunta notes the Administrator’s statements that the ABCD form

is “important” and that failure to procure Giunta’s signature on

the form in connection with his relocation might have been an

“inadvertent administrative error.” These statements indicate the

purpose served by the ABCD form, documentation of written consent,

5 which would end the inquiry into whether Giunta provided written

consent to relocate. The statements do not indicate that the

Administrator interpreted “written consent” to exclude all means of

consent other than the ABCD form.

Next we consider whether the Administrator provides a fair

reading of “written consent.” Whether the requirement of written

consent is considered under ERISA or contract law, the result is

the same. In the ERISA context, "Eligibility for benefits under

any ERISA plan is governed in the first instance by the plain

meaning of the plan language." Threadgill v. Prudential Sec.

Group, Inc., 145 F.3d 286, 292 (5th Cir. 1998). Similarly,

contract law in the Commonwealth of Virginia, which applies to

those portions of the Plan not preempted by ERISA, requires that

terms be given their “usual, ordinary, and popular meaning.” D.C.

McClain, Inc. v. Arlington County, 452 S.E.2d 659, 662 (Va. 1995).

The Plan does not define or limit “written consent.” Only an

unreasonable construction of the term would restrict it to the ABCD

form or any particular form; a reasonable construction allows for

any kind of writing by an employee indicating his consent to

relocate. The relocation reimbursement expense forms, which

include a declaration verifying that the expenses were incurred in

accordance with the company’s relocation policy, are well within a

fair reading of “written consent” such that the employee submitting

the forms can be said to have consented to the relocation in

6 writing.2

Finally, we consider whether the interpretation would generate

unanticipated costs under the plan. As was true before the

district court, the parties did not provide briefing on the issue.

We nonetheless conclude, in agreement with the district court, that

the broader definition applied by the Administrator will not result

in unanticipated costs as compared to a restriction of the term

“written consent” to the ABCD form. The broader definition

excludes from eligibility employees who consent to relocation but

fail to sign the ABCD form, resulting in lower costs to the Plan

rather than unanticipated expenses to the Plan.

II.

In conclusion, the Administrator’s interpretation of “written

consent” as including relocation expense forms is legally correct.

It is undisputed that Giunta submitted forms claiming expenses

reimbursable only to employees who relocate. Because the forms

constitute written consent to relocate to Houston, the

Administrator was correct in determining that Giunta had not

terminated his employment for “good reason” and was ineligible for

2 Giunta misses the mark with his insistence that there was no meeting of the minds regarding his waiver of Plan benefits. The non-availability of severance benefits was a consequence of Giunta’s consent, not the object of his consent. The object of his consent was his relocation to Houston. We ask only whether the forms submitted by Giunta in connection with his move to Houston fairly fall within the term “written consent,” thus rendering Giunta ineligible to claim he terminated his employment for “good reason”.

7 severance benefits. We therefore need not reach the abuse-of-

discretion inquiry, see Chevron, 47 F.3d at 146, or Giunta’s

requests for damages and attorney’s fees. The judgment of the

district court granting summary judgment to the Plan and denying

summary judgment to Giunta is

AFFIRMED.