PPG Industries Pension Plan A (CIO) v. Crews

902 F.2d 1148, 1990 WL 58848
CourtCourt of Appeals for the Fourth Circuit
DecidedMay 9, 1990
DocketNos. 89-2969, 89-2979
StatusPublished
Cited by3 cases

This text of 902 F.2d 1148 (PPG Industries Pension Plan A (CIO) v. Crews) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fourth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
PPG Industries Pension Plan A (CIO) v. Crews, 902 F.2d 1148, 1990 WL 58848 (4th Cir. 1990).

Opinion

WILKINSON, Circuit Judge:

In this case we must decide whether ERISA preempts a state statute that purportedly prohibits a company from deducting the amount of pension benefits previously paid to a retiree from the amount of the retiree’s subsequent retroactive award of workers’ compensation. We must also determine whether the pension plan in issue authorizes this offset. The district court held that ERISA controls and that the plan permits the offset.

We affirm.

I.

Appellants Elvin J. Crews, John L. Ware, Paul W. Carder, and James H. Outright are former employees of appellee PPG Industries, Inc. When appellants retired during the years 1973-1975, they began to receive monthly pension payments under PPG Industries Retiree Pension Plan I (“The Plan”). The Plan, which was created as a result of collective bargaining between PPG and union representatives, is subject to federal regulation under the Employee Retirement Income Security Act, 29 U.S.C. §§ 1001, et seq. (“ERISA”).

In the years 1984-1986, appellants filed claims under West Virginia’s Workers’ Compensation Act for total disability as a result of their prolonged exposure to occupational dust. The West Virginia Workers’ Compensation Commissioner found that appellants suffered from occupational pneu-moconiosis and qualified for permanent total disability. As a result, the Commissioner ordered PPG — which insured itself for workers’ compensation instead of participating in an independent workers’ compensation fund — to make retroactive and prospective workers’ compensation payments. The pay orders for retroactive payments covered the period from each claimant’s date of retirement to the date of the Commissioner’s award.

Upon receipt of the Commissioner’s pay orders, PPG deducted the amount that it had already paid appellants in retirement pension benefits under the Plan from the amount of past payments due appellants under the retroactive awards of workers’ compensation. It took this course pursuant to a provision of the Plan that contemplated an integration of pension benefits with workers’ compensation benefits. The pertinent section of the Plan provides:

Any amount paid to or on behalf of any Employee or pensioner on account of injury or occupational disease causing disability in the nature of a permanent disability for which the Company is liable, whether pursuant to Workmen’s Compensation or occupational disease laws, ... shall be deducted from or charged against the amount of any pension payable ... for the period corresponding to the period to which such other amount or payment is applicable....

Pending resolution of this suit, PPG placed in escrow the difference between the amount of the Commissioner’s pay orders and the amount that it paid appellants after integrating the funds.

Appellants filed administrative complaints with the Commissioner, arguing that PPG’s offset was illegal. The Commissioner dismissed these complaints, holding that appellants had received the net total due them under both the Plan and the workers’ compensation law. The West Virginia Workers’ Compensation Appeal Board affirmed the Commissioner, and appellants sought review in the West Virginia Supreme Court.

In the' meantime, the Plan administrator and PPG filed the instant suit in federal district court against the Commissioner. They sought declaratory and injunctive relief, including a determination that under ERISA a retroactive award under West Virginia’s workers’ compensation laws could not defeat the Plan’s provision for integration of benefits. Appellants intervened in the federal action as defendants. [1150]*1150The West Virginia Supreme Court subsequently dismissed the state suit without prejudice in light of the pending federal action.

The federal district court granted the relief requested by PPG. After determining that West Virginia law concerning the regulation of workers’ compensation funds “related to” the Plan and was thus partially preempted by ERISA, the court held that the Plan authorized PPG’s offset.

This appeal followed.

II.

Appellants first contend that PPG’s offset is prohibited by the West Virginia Workers’ Compensation Act. They argue that because West Virginia law requires a self-insurer like PPG to maintain a separate account for payment of workers’ compensation benefits which cannot be combined with funds used to pay pension benefits, see 85 W.Va. C.S.R. § l-4.1(e), PPG’s reduction of the face amount of the Commissioner’s pay orders by the amount of pension benefits already paid to appellants was an illegal admixture of benefit funds. Appellees dispute appellants’ characterization of Section 1-4.1(e), which they claim does not require self-insured companies to establish an inviolable workers’ compensation fund.

This case will not permit us to resolve the dispute about the proper interpretation of West Virginia law. ERISA was “intended to displace all state laws that fall within its sphere, even including state laws that are consistent with ERISA’s substantive requirements.” Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 739, 105 S.Ct. 2380, 2389, 85 L.Ed.2d 728 (1985). We hold that whatever the law’s correct construction, it is preempted by ERISA to the extent that it “relates to” integration of pension benefits with awards of workers’ compensation.

ERISA “supersede^] any and all State laws insofar as they ... relate to any employee benefit plan” within its scope. 29 U.S.C. § 1144(a) (emphasis added). The Supreme Court has been emphatic on ERISA’s preemptive force. “A law ‘relates to’ an employee benefit plan ... if it has a connection with or reference to such a plan.” Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97, 103 S.Ct. 2890, 2900, 77 L.Ed.2d 490 (1983). ERISA preemption, moreover, “is not limited to ‘state laws specifically designed to affect employee benefit plans,’ ” Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 47-48, 107 S.Ct. 1549, 1553, 95 L.Ed.2d 39 (1987) (quoting Shaw, 463 U.S. at 98, 103 S.Ct. at 2900), for “even indirect state action bearing on private pensions may encroach upon the area of exclusive federal concern.” Alessi v. Raybestos-Manhattan, Inc., 451 U.S. 504, 525, 101 S.Ct. 1895, 1907, 68 L.Ed.2d 402 (1981).

In Alessi, the Supreme Court considered a New Jersey statute that prohibited reduction of pension benefits by the amount of workers’ compensation awards received by retirees. Alessi held that New Jersey’s statute “related to” pension plans governed by ERISA and was thus preempted because it impermissibly “eliminate[d] one method for calculating pension benefits— integration — that is permitted by federal law.” Id. at 524, 101 S.Ct. at 1907. The Alessi

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Ppg Industries Pension Plan A v. Crews
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Bluebook (online)
902 F.2d 1148, 1990 WL 58848, Counsel Stack Legal Research, https://law.counselstack.com/opinion/ppg-industries-pension-plan-a-cio-v-crews-ca4-1990.