Paul Deppenbrook v. PBGC ( 2015 )

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT
Argued November 18, 2014 Decided February 20, 2015
No. 13-5254
PAUL DEPPENBROOK, ON BEHALF OF ALL
RTI BEAVER FALLS EMPLOYEES 9305-04,
APPELLANT
v.
PENSION BENEFIT GUARANTY CORPORATION,
APPELLEE
Appeal from the United States District Court
for the District of Columbia
(No. 1:11-cv-00600)
Paul Deppenbrook, pro se, argued the cause and filed
briefs for the appellant.
Nathaniel Rayle, Attorney, Pension Benefit Guaranty
Corporation, argued the cause for the appellee. Judith Starr,
General Counsel, Israel Goldowitz, Chief Counsel, Karen L.
Morris, Deputy Chief Counsel and Kartar Khalsa, Assistant
Chief Counsel were with him on brief.
Before: HENDERSON, GRIFFITH and SRINIVASAN, Circuit
Judges.
Opinion for the Court filed by Circuit Judge HENDERSON.
2
KAREN LECRAFT HENDERSON, Circuit Judge: Paul
Deppenbrook worked for Republic Technologies
International, LLC (RTI), a steel company that filed for
bankruptcy in 2001. Once bankruptcy proceedings began, the
Pension Benefit Guaranty Corporation (PBGC) terminated the
pension plans administered by RTI. After many rounds of
litigation, the PBGC eventually determined the amounts due
former RTI employees under the pension plans and disbursed
them. Deppenbrook believes the PBGC miscalculated his
benefits. His claim, however, was rejected in his
administrative appeal. He then sued the PBGC in district
court, raising claims under the Employee Retirement Income
Security Act (ERISA), 29 U.S.C. §§ 1001 et seq., and seeking
to correct the PBGC’s benefit determinations. The district
court granted summary judgment to the PBGC. We affirm. 1
I. BACKGROUND
A. Statutes
The PBGC is a federal corporation charged with
“administer[ing] and enforc[ing] the plan termination
insurance provisions” of ERISA. PBGC v. Fed. Labor
Relations Auth., 967 F.2d 658, 660 n.1 (D.C. Cir. 1992). It is
governed by a board of directors composed of the Secretaries
of Labor, Commerce and the Treasury. 29 U.S.C.
§ 1302(d)(1). One of its goals is “to provide for the timely
1
Although Deppenbrook’s notice of appeal indicates that he “and those
similarly situated” appeal the district court’s judgment, Joint Appendix
(JA) 180, Deppenbrook, as a pro se party, may represent himself only.
See Georgiades v. Martin-Trigona, 729 F.2d 831, 834 (D.C. Cir. 1984)
(appellee’s son, “not a member of the bar of any court,” could appear pro
se but was “not qualified to appear in the District Court or in this court as
counsel for others”). We therefore treat Deppenbrook as the sole
appellant.
3
and uninterrupted payment of pension benefits to participants
and beneficiaries under plans” covered by ERISA. Id.
§ 1302(a)(2). In order to protect the financial viability of its
fund, the PBGC is allowed to terminate a pension plan under
certain conditions. See id. § 1342(a). As relevant here, the
PBGC may terminate a plan when “the possible long-run loss
of the [PBGC] with respect to the plan may reasonably be
expected to increase unreasonably if the plan is not
terminated.” Id. § 1342(a)(4). Once the PBGC terminates a
pension plan, it “typically becomes trustee of the plan, takes
over the assets and liabilities of the plan, and pays benefits to
plan participants.” PBGC v. Republic Tech. Int’l, LLC (RTI),
386 F.3d 659, 661 (6th Cir. 2004).
In order to appropriately distribute benefits under a plan,
the PBGC and the plan administrator 2 must agree on the date
of plan termination. Determining the date can turn
contentious. A plan’s termination date “is significant” to plan
participants “because it marks the date on which [their]
benefits . . . cease to accrue.” RTI, 386 F.3d at 662. It is also
important to the PBGC because “the date of termination can
significantly affect the extent of PBGC’s recovery from the
employer,” an especially sensitive consideration if “bankrupt
corporations with deteriorating financial resources” are
involved. Id. If these competing interests prevent agreement
on a plan termination date, “the termination date of a single-
employer plan is . . . the date established by the court.” 29
U.S.C. § 1348(a)(4).
2
ERISA defines a plan administrator as “the person specifically so
designated by the terms of the instrument under which the plan is
operated.” 29 U.S.C. § 1002(16)(A)(i). If the instrument creating the plan
does not specify an administrator, “the plan sponsor” is the administrator.
Id. § 1002(16)(A)(ii).
 4
The PBGC cannot administer certain types of pension
plans. “In enacting ERISA, Congress distinguished between
two types of employee retirement benefit plans: ‘defined
benefit plans’ and ‘defined contribution plans,’ also known as
‘individual account plans.’ ” Connolly v. PBGC, 475 U.S.
211, 229 (1986) (O’Connor, J., concurring) (citing 29 U.S.C.
§§ 1002(34), (35)) (internal alterations omitted). ERISA’s
pension insurance program “applies to defined benefit plans
but not to defined contribution plans.” Id. at 229–30 (citing
29 U.S.C. § 1321(b)(1)). The Congress made the distinction
because an individual account plan “does not specify benefits
to be paid, but instead establishes an individual account for
each participant to which employer contributions are made.”
Id. at 230 (citing 29 U.S.C. § 1002(34)); see also Hughes
Aircraft Co. v. Jacobson, 525 U.S. 432, 439 (1999) (noting
there can never be insufficient funds in individual account
plan “since each beneficiary is entitled to whatever assets are
dedicated to his individual account”).
Moreover, not every pension benefit included in a defined
benefit plan is insured through ERISA. 3 See PBGC v. LTV
Corp., 496 U.S. 633, 637–38 (1990) (“ERISA . . . limits . . .
benefits PBGC may guarantee upon plan termination, . . .
even if an employee is entitled to greater benefits under the
terms of the plan.”). The PBGC is obligated to insure only
“the payment of all nonforfeitable benefits” a plan participant
is due. 4 29 U.S.C. § 1322(a). The Congress defines
“nonforfeitable” to include “a claim obtained by a participant
. . . to that part of an immediate or deferred benefit under a
3
A “defined benefit plan” is broadly defined in ERISA as “a pension plan
other than an individual account plan.” 29 U.S.C. § 1002(35).
4
The Supreme Court has noted that “nonforfeitable” and “vested” are
synonymous in this context. Nachman Corp. v. PBGC, 446 U.S. 359,
376–78 (1980).
5
pension plan which arises from the participant’s service,
which is unconditional, and which is legally enforceable
against the plan.” Id. § 1002(19). The PBGC guarantees only
those benefits that are nonforfeitable as of the plan
termination date. See LTV Corp., 496 U.S. at 637–38 (PBGC
insures only “those benefits to which participants have earned
entitlement under the plan terms as of the date of
termination”); see also 29 C.F.R. § 4022.3(a)(1) (PBGC
guarantees benefit, subject to minimal exceptions, that “is, on
the termination date, a nonforfeitable benefit” (emphasis
added)); id. § 4022.4(a)(3) (same).
B. Facts
When Deppenbrook’s employer filed for bankruptcy, the
PBGC stepped in to terminate the employees’ pension plan.
RTI, 386 F.3d at 663–64. The PBGC, however, was
concerned about the plan termination date. Id. at 664–65. At
the heart of the dispute was the availability of “shutdown
benefits.” Id. at 662–63. Shutdown benefits are “enhanced
early retirement benefits for certain workers who are affected
by a facility shutdown or business cessation.” Id. Employees
who meet “certain age and service requirements” can begin
receiving shutdown benefits “after a plant shutdown, rather
than having to wait while out of work to reach a specific
retirement age.” Id. at 663. Under the RTI plan, shutdown
benefits were triggered by, inter alia, a “break in continuous
service,” which the plan defined as “[t]ermination . . . due to
permanent shutdown of a plant, department or subdivision
thereof.” JA 363. RTI had given notice to its employees in
May 2002 that it planned to permanently shut down its plant
in Beaver Falls, Pennsylvania, sometime in July or August.
Thus, if the plant shutdown happened while the RTI plan was
still in effect, the terminated employees would satisfy the
plan’s “break in continuous service” requirement and would
6
be eligible to receive shutdown benefits. But if the pension
plan terminated before the plant shutdown, the PBGC would
not be obligated to guarantee those benefits.
The PBGC selected June 14, 2002, as the plan termination
date in order to avoid paying shutdown benefits to former RTI
employees. Id. at 664–65. The PBGC was concerned
because “shutdown benefits [would] potentially increase[] the
amount of unfunded liabilities for the plans by almost $96
million.” Id. at 664. The district court in RTI, however,
rejected the PBGC’s proposed date, concluding that “the plan
participants continued to have strong reliance interests in the
receipt of shutdown benefits” even after the PBGC notified
the participants of their plan’s termination. Id. at 665. The
district court ultimately set the plan termination date as
August 17, 2002—one day after RTI sold its assets to another
firm—obligating the PBGC to pay shutdown benefits. Id.
The Sixth Circuit reversed. It held that “[a]fter the
employees received notice that PBGC intended to terminate
the pension plans . . ., the participants no longer had a
justifiable expectation in the accrual of vested pension rights,”
including shutdown benefits. Id. at 666–67 (internal
quotation marks omitted). Moreover, the employees’ reliance
interest in shutdown benefits was not as “strong” as the
district court had concluded because shutdown benefits were
“contingent on bankruptcy court approval, and that approval
was not given until . . . one month after PBGC issued the
notices of termination.” Id. at 667 (emphasis in original).
The Sixth Circuit also chastised the district court for not
giving “appropriate deference to PBGC’s conclusion” and re-
set the plan termination date as June 14, 2002. 5 Id. at 667–68.
5
Deppenbrook was also involved in litigation in the Third Circuit. In
Nicol v. USWA, he and other former RTI employees sued their union—the
7
The PBGC and RTI entered into a settlement agreement
that outlined how the RTI employees’ pension-plan accounts
were to be administered. While the PBGC administered the
defined benefit portion of the plan, the settlement agreement
specified that the parties were to hire a third-party accounts
administrator to handle the funds in the individual accounts.
The agreement provided that the accounts administrator was
to terminate the individual accounts and allow employees to
receive the funds using one of the options provided under the
pension plan. Employees could not, however, decline the
distribution. The PBGC also reduced the monthly benefits
payable under the defined benefit portion of the plan for
employees based on the amounts distributed from the separate
individual accounts.
With the settlement agreement in place, the PBGC
calculated the monthly benefits owed to each employee.
Deppenbrook believed his benefit calculations were in error
and sought review by the PBGC Appeals Board. He raised
nine claims before the Board but it rejected all of them in a
17-page letter. At the end of its letter, the PBGC Appeals
Board informed Deppenbrook of his right to seek further
review in federal court.
United Steelworkers of America (USWA)—for its conduct during the
closing of the plant where they worked. 331 F. App’x 909, 910 (3d Cir.
2009). They alleged that the union was liable for fraud and breach of
fiduciary duty. Id. The district court granted summary judgment to the
USWA on all counts and the Third Circuit affirmed, id. at 911,
characterizing the employees’ claims as claims of “breach of fair
representation.” Id. at 910. This meant that the six-month statute of
limitations in 29 U.S.C. § 160(b) applied and that the claims against the
USWA came too late. Id. at 911. Moreover, irrespective of the time bar,
the court concluded that the plaintiffs “utterly failed to raise any material
question of fact” and affirmed summary judgment for the union. Id.
8
Deppenbrook sought such review, suing the PBGC in
district court here. After discovery was completed, both
parties cross-moved for summary judgment. In ruling on the
motions, the district court made three central holdings. First,
it held that the PBGC properly interpreted ERISA and its own
regulations by insuring only benefits that were nonforfeitable
on the plan termination date. See Deppenbrook v. PBGC, 950
F. Supp. 2d 68, 74–76 (D.D.C. 2013). Consequently,
Deppenbrook was not entitled to shutdown benefits because
he was not terminated until approximately six weeks after the
plan terminated on June 14, 2002. Id. at 75–76.
Deppenbrook argued that the plan termination date was
effectively May 1—rather than June 14—because that was the
date on which he received the notice of plant closure pursuant
to the Worker Adjustment and Retraining Act (WARN Act),
29 U.S.C. §§ 2101–2109. 6 The district court rejected the
argument because the WARN Act notice spoke of plant
closure as a likelihood, not a certainty. Deppenbrook, 950 F.
Supp. 2d at 76–77. Second, the court held that the WARN
Act’s 60-day notice requirement, 29 U.S.C. § 2102(a), was
not a “required waiting period” under ERISA, id.
§ 1301(a)(8), and therefore did not cause shutdown benefits to
vest on May 1. Deppenbrook, 950 F. Supp. 2d at 77–78. And
third, the district court held that the PBGC properly declined
to administer the individual account portions of the pension
plan. Id. at 78. Although Deppenbrook’s defined benefit and
individual account plans merged into one plan after a
corporate reorganization in 1998, the merger did not “create[]
6
The WARN Act “provides protection to workers, their families and
communities by requiring employers to provide notification 60 calendar
days in advance of plant closings and mass layoffs.” 20 C.F.R. § 639.1(a).
The advance notice allows “workers and their families some transition
time to adjust to the prospective loss of employment, to seek and obtain
alternative jobs and, if necessary, to enter skill training or retraining that
will allow these workers to successfully compete in the job market.” Id.
9
an obligation” in the PBGC to “insure the entirety of the
combined plan.” Id. Accordingly, the district court granted
summary judgment to the PBGC. Id. at 80. Deppenbrook
timely appealed.
II. ANALYSIS
We review a district court’s grant of summary judgment
de novo. Forsyth Mem’l Hosp., Inc. v. Sebelius, 639 F.3d
534, 537 (D.C. Cir. 2011). Summary judgment is granted if
“there is no genuine dispute as to any material fact and the
movant is entitled to judgment as a matter of law.” FED. R.
CIV. P. 56(a). Our inquiry is more nuanced, however, if the
dispute involves the review of agency action. “When the
judgment of the district court is on review of an
administrative decision, . . . we review the administrative
record to determine whether the agency’s decision was
arbitrary and capricious, and whether its findings were based
on substantial evidence.” Forsyth, 639 F.3d at 537. We
therefore accord “no particular deference to the judgment of
the District Court.” Holland v. Nat’l Mining Ass’n, 309 F.3d
808, 814 (D.C. Cir. 2002). We uphold summary judgment for
the agency unless it “violated the Administrative Procedure
Act by taking action that is ‘arbitrary, capricious, an abuse of
discretion, or otherwise not in accordance with law’ or is
‘unsupported by substantial evidence.’ ” Forsyth, 639 F.3d at
537 (quoting 5 U.S.C. § 706(2)).
We consider one matter before addressing Deppenbrook’s
arguments. When we are called to interpret a statute that the
agency under review is charged with administering, we
typically apply Chevron U.S.A., Inc. v. NRDC, 467 U.S. 837
(1984). Under that framework:
We first ask whether Congress has directly
spoken to the precise question at issue, in
10
which case we must give effect to the
unambiguously expressed intent of Congress.
If the statute is silent or ambiguous with
respect to the specific issue, however, we
move to the second step and defer to the
agency’s interpretation as long as it is based on
a permissible construction of the statute.
NRDC v. EPA, 706 F.3d 428, 431 (D.C. Cir. 2013) (internal
quotation marks omitted). Here, however, our inquiry is
somewhat muddied. During oral argument, we noted that the
PBGC had not offered an authoritative interpretation of the
provisions at issue. Oral Arg. Recording at 18:10–19:10. In
other words, we do not have the PBGC’s pre-litigation
interpretation to which we can defer. See Landmark Legal
Found. v. IRS, 267 F.3d 1132, 1136 (D.C. Cir. 2001)
(declining to apply Chevron deference to statutory
interpretation agency “developed in litigation”). Had the
PBGC Appeals Board offered its statutory interpretation in its
decision-letter to Deppenbrook, that interpretation would
likely be subject to the two-step Chevron framework. See
Mylan Labs., Inc. v. Thompson, 389 F.3d 1272, 1279–80
(D.C. Cir. 2004) (applying Chevron deference to FDA letter
decision in informal adjudication). But the PBGC had no
reason to offer an interpretation because Deppenbrook did not
raise in his administrative appeal the statutory arguments he
now raises. This failure ordinarily results in forfeiture. See
Malladi Drugs & Pharms., Ltd. v. Tandy, 552 F.3d 885, 891
(D.C. Cir. 2009) (“We consistently refuse to
consider arguments litigants raise for the first time in court
rather than before the agency . . . .”); Military Toxics Project
v. EPA, 146 F.3d 948, 956–57 (D.C. Cir. 1998) (argument not
raised before agency is forfeited because parties “may not
raise [an argument] for the first time upon appeal”). Any
forfeiture by Deppenbrook, however, has itself been forfeited
11
as the PBGC has not raised it. See BNSF Ry. Co. v. Surface
Transp. Bd., 604 F.3d 602, 611 (D.C. Cir. 2010) (“a forfeiture
can be forfeited by failing on appeal to argue an argument
was forfeited”). Nevertheless, whether we apply Chevron
deference or simply rely on the PBGC’s “power to persuade,”
Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944), our
conclusion is the same: the PBGC properly applied ERISA.
See Springfield, Inc. v. Buckles, 292 F.3d 813, 817–18 (D.C.
Cir. 2002) (avoiding in-depth analysis regarding level of
deference because agency decision affirmable “under either
line of authority”).
On appeal, Deppenbrook makes three arguments. First,
he argues that he was entitled to shutdown benefits because he
was constructively terminated before June 14, 2002, the date
of the plan termination. Second, he contends that ERISA
required the PBGC to insure and administer the funds in his
individual account. And third, he claims that the PBGC
unlawfully amended the provisions of his pension plan.
A. Shutdown Benefits
As already noted, shutdown benefits “are enhanced early
retirement benefits for certain workers who are affected by a
facility shutdown or business cessation.” RTI, 386 F.3d at
662–63. The point at which shutdown benefits vest under
Deppenbrook’s pension plan turns on, inter alia, the date on
which the employee experienced a break in continuous
service. His pension plan defines “break in continuous
service,” as relevant here, to include “[t]ermination . . . due to
permanent shutdown of a plant, department or subdivision
thereof.” JA 363. Based on the plan termination date of June
14, 2002, set by the Sixth Circuit in RTI, shutdown benefits
were purportedly off the table. RTI and the USWA decided
that the nominal shutdown date for Deppenbrook’s plant was
12
July 11, 2002, the date that the bankruptcy court approved
RTI’s asset sale. And it is undisputed that Deppenbrook was
not, in fact, terminated until August 16, 2002. Because he did
not experience a “break in continuous service” until well after
the plan termination date, shutdown benefits did not vest in
time to become nonforfeitable and covered by ERISA. See 29
U.S.C. § 1322(a); see also 29 C.F.R. §§ 4022.3(a)(1),
4022.4(a)(3).
Deppenbrook attempts to circumvent this result by
arguing that he was effectively terminated on May 1, 2002,
the date he received the WARN Act notice. 7 The notice,
however, cannot bear this weight. First, the WARN Act
notice spoke of shutdown as a likelihood, not a certainty. The
notice stated that the company “plans to permanently” close
the plant where Deppenbrook worked. JA 275 (emphasis
added). It also cautioned that permanent closure was “subject
to the approval of the Bankruptcy Court,” meaning the plant
remained open indefinitely until the bankruptcy court acted.
Id. The notice closed by reserving the employer’s rights
under the WARN Act “should circumstances change.” Id.
And above all, it is undisputed that Deppenbrook remained
employed until August 2002, long after he received the
WARN Act notice.
Deppenbrook further posits that, under ERISA, the
WARN Act notice period is a “required waiting period.”
7
Deppenbrook also appears to argue that he was effectively terminated
when he received a 90-day advance notice of plant closure pursuant to a
provision in the master collective bargaining agreement. This argument
fails because, like the WARN Act notice, the 90-day advance notice
period is not a “required waiting period” under ERISA. See infra pp. 13–
14. In any event, even if the 90-day advance notice period were such a
waiting period, Deppenbrook had no break in continuous service before
the plan termination date.
13
ERISA defines a nonforfeitable benefit as a benefit for which
the plan participant has “satisfied the conditions for
entitlement . . . other than . . . completion of a required
waiting period.” 29 U.S.C. § 1301(a)(8) (emphasis added).
Deppenbrook contends that he satisfied the conditions for
shutdown benefits on May 1, the day he received the WARN
Act notice. The period of time after he received the notice
was simply a “required waiting period” that did not affect the
vesting of his shutdown benefits on May 1. We disagree.
The WARN Act 60-day period is explicitly described by
statute as a “notice” period, not a “required waiting period.”
See 29 U.S.C. § 2102(a). Additionally, the text of ERISA
forestalls Deppenbrook’s argument. The relevant provision
reads:
“[N]onforfeitable benefit” means, with respect
to a plan, a benefit for which a participant has
satisfied the conditions for entitlement under
the plan or the requirements of this chapter
(other than submission of a formal application,
retirement, completion of a required waiting
period, or death in the case of a benefit which
returns all or a portion of a participant’s
accumulated mandatory employee contri-
butions upon the participant’s death) . . . .
Id. § 1301(a)(8) (emphasis added). The phrase “under the
plan or the requirements of this chapter” modifies the
circumstances in the parenthetical that follows. In other
words, the “required waiting period” must be part of the
pension plan or appear in chapter 18 of title 29. The WARN
Act notice period, however, is not a part of Deppenbrook’s
pension plan and is located in a different chapter. Compare
id. § 1301 (located in chapter 18 of title 29) with id. § 2102
 14
(located in chapter 23 of title 29). Consequently, the WARN
Act notice period is not a mere waiting period within the
meaning of ERISA’s definition of a nonforfeitable benefit.
Even if it were, that would not advance Deppenbrook’s cause.
That is, even if ERISA did not require Deppenbrook to wait
out the WARN Act period, he nonetheless had to meet the
plan’s other “conditions for entitlement” before the plan
termination date—namely, the requirement that he incur a
break in continuous service. As discussed earlier, he was not
terminated as of the date of the WARN Act notice because he
remained employed until mid-August. The PBGC therefore
properly interpreted the provisions of ERISA and did not act
arbitrarily or capriciously in declining to provide shutdown
benefits to Deppenbrook.
B. Individual Accounts
Deppenbrook next contends that the PBGC misinterpreted
29 U.S.C. § 1321 in failing to insure his individual account,
instead forcing Deppenbrook to receive a lump sum
distribution of his individual account balance and then
offsetting his monthly pension payable under the PBGC-
administered defined benefit portion of his plan by an equal
amount. But he acknowledges, as he must, that ERISA’s
coverage does not extend to an “individual account plan,” 29
U.S.C. § 1321(b)(1), or to a “defined benefit plan, to the
extent that it is treated as an individual account plan,” id.
§ 1321(b)(12). The PBGC points to these provisions as
support for its decision not to administer Deppenbrook’s
individual account plan. Deppenbrook responds that the
governing provision is 29 U.S.C. § 1321(c)(1), which states
that “the term ‘individual account plan’ does not include a
plan under which a fixed benefit is promised if the employer
or his representative participated in the determination of that
benefit.” According to Deppenbrook, then, the PBGC had to
15
insure his individual account because section 1321(c)(1)
provides that it was not an individual account under ERISA.
We are unpersuaded.
An individual account plan is defined as “a pension plan
which provides for an individual account for each participant
and for benefits based solely upon the amount contributed to
the participant’s account, and any income, expenses, gains
and losses” attributed to the account. Id. § 1002(34).
Deppenbrook’s pension-plan benefit included “a defined
benefit pension determined in accordance with Article 5” of
the pension plan, as well as an “Individual Account Benefit
based on the balance of the Individual Account of the
Participant.” JA 410. Each individual account was simply
“an account maintained on behalf of a” plan participant. Id. at
411. As explained earlier, supra page 4, the PBGC is
statutorily prohibited from insuring this account.
Section 1321(c)(1) does not help Deppenbrook. That
section provides that an individual account plan “does not
include a plan under which a fixed benefit is promised if the
employer or his representative participated in the
determination of that benefit.” Deppenbrook’s individual
account was not comprised of a fixed benefit determined by
his employer. Instead, each individual account operated as a
collection of funds that were invested but with no guarantee
that a specified amount would be owed each employee once
he retired. See JA 414 (“Upon any retirement or other
termination of employment under Article 4 of the [pension]
Plan, a Participant shall be eligible for a monthly pension
benefit equal to that which can be provided by the vested
value of his Individual Account.” (emphasis added)).
Deppenbrook notes that, as a result of an earlier corporate
merger, he had one pension plan—a defined benefit plan—
16
with an individual account component. He believes that the
individual account was part of the overall defined benefit plan
and that the PBGC was thus obligated to insure the entirety of
the plan. The individual account, however, is explained in a
separate appendix to the defined benefit plan. Deppenbrook
does not point to any evidence that his individual account ever
merged with his defined benefit account. Instead, it retained
the essential features of an individual account throughout the
course of his employment at RTI. Because the Congress
wanted the PBGC to insure only those portions of a plan that
promise a guaranteed benefit, both the text and purpose of
ERISA make clear that the PBGC could not insure
Deppenbrook’s individual account. The PBGC therefore
properly interpreted ERISA and did not act arbitrarily or
capriciously in failing to insure Deppenbrook’s individual
account.
C. Unlawful Amendment
Deppenbrook’s final argument is that the PBGC
unlawfully amended his pension plan by requiring him to
accept a distribution of his individual account (triggering an
offsetting reduction in the payments to him under the defined
benefit portion of the plan). Assuming arguendo that the
PBGC in fact amended the plan, Deppenbrook cannot identify
a statutory provision that bars the PBGC from doing so. He
points to 29 U.S.C. § 1054(g), which says that a plan
participant’s accrued benefit generally “may not be decreased
by an amendment of the plan.” But see Hughes, 525 U.S. at
442 (“ERISA provides an employer with broad authority to
amend a plan . . . .”). Yet the PBGC and the plan termination
insurance program are addressed in an entirely different
subchapter of ERISA. Compare 29 U.S.C. § 1054 (appearing
in subchapter I of chapter 18), with id. § 1302 (appearing in
subchapter III of chapter 18). ERISA makes clear that section
17
1054 applies if an employer—not the PBGC—retains control
over a pension plan. See id. § 1003(a)(1) (“this subchapter,”
i.e. § 1054 subchapter, applies to pension plans maintained
by, inter alia, “any employer engaged in commerce or in any
industry or activity affecting commerce” (emphasis added)).
For the foregoing reasons, the district court’s judgment is
affirmed.
So ordered.