Sharma v. Washington Metropolitan Area Transit Authority

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
)
RAMESH SHARMA, )
)
Plaintiff, )
)
v. ) Civ. No. 03-1768 (TFH)
)
)
WASHINGTON METROPOLITAN )
AREA TRANSIT AUTHORITY, et al., )
)
Defendants. )
)
MEMORANDUM OPINION
Plaintiff Ramesh Sharma filed this action asserting claims for breach of fiduciary duty, breach
of contract, and “tortious interferences with trust relationship.” He also pleads violations of Title VII
of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. (“Title VII), and the Employee Retirement
Income Security Act of 1974, 29 U.S.C. § 1001 et seq. (“ERISA”). He alleges that defendants acted
unlawfully and in concert to decrease the amount of his monthly retirement pension benefit. Before
the Court is defendants’ Joint Motion for Summary Judgment. The Court has carefully reviewed
defendants’ motion, plaintiff’s opposition thereto, defendants’ reply, and the entire record of this
case. The Court GRANTS defendants’ motion in its entirety. Plaintiff’s ERISA claims are dismissed
as being legally deficient; his Title VII claims and the related breach of contract claim are dismissed
as being wholly unsupported by the record; his tort claims against the individual Washington
Metropolitan Area Transit Authority defendants are barred by the doctrine of sovereign immunity; his
remaining claims against the Washington Metropolitan Area Transit Authority and the Trustees of the
Retirement Plan are barred by the language of the documents governing the Retirement Plan; and his
remaining claims against the Retirement Plan Committee defendants are rejected because he has
offered no evidence suggesting that those defendants acted arbitrarily and capriciously in denying his
claim for an augmented monthly pension benefit.
I. Background
Plaintiff, a United States citizen of Asian-Indian origin, worked for the Washington
Metropolitan Area Transit Authority (“WMATA”) from 1983 through 2002. Sworn Decl. of Ramesh
Sharma (“Pl.’s Decl.”) ¶¶ 1-2. During this period, he served in both professional and managerial
capacities. Id. In 1994, plaintiff initiated a series of Equal Employment Opportunity actions against
WMATA, all of which the parties settled in 2001. See id. ¶ 2. The Agreement in Principle
memorializing the settlement (“Settlement Agreement”) required that plaintiff resign from WMATA.
Id. In exchange, he received certain considerations from WMATA, including a sum designated as
backpay. See Pl.s’ Opp. Defs.’ Mot. Summ. J. (“Pl.s’ Br.”) at 5; Defs.’ Mem. Supp. Mot. Summ. J.
(“Defs.’ Br.”) at 3.1
1
The terms of the Settlement Agreement are confidential and, as a result, defendants filed their
motion under seal. Defs.’ Joint Mot. Summ. J. at 1-2 n.1. Defendants redacted the specific amounts
of money WMATA paid to plaintiff as part of the settlement of the prior Equal Employment
Opportunity claim. Defs.’ Br. at 3. In his brief, plaintiff revealed the amount of the backpay he
received. Pl.s’ Br. at 5. The Court will not disclose the amount of the backpay here, and notes that
the fact of the backpay and the manner in which it was included in plaintiff’s pension calculation is
relevant to this dispute, and that the amount of the backpay is not.
-2-
WMATA offers a retirement pension plan (“Retirement Plan”) for its employees. The
Retirement Plan does not require employee contributions; it is funded by investment earnings with
WMATA covering any difference between available funds and required pension payments. Defs.’
Ex. 3A (“Plan Document”) §§ 2.02, 2.03. Under the Plan Document, WMATA serves as Plan
Sponsor, and delegates to the Board of Trustees of the Retirement Plan (“Trustees”) the role of Plan
Administrator. Id. § 11.03. The day-to-day administration of the Retirement Plan, in turn, is
performed by the Retirement Plan Committee. Id. § 11.04.
While the Plan Document empowers the Trustees to establish the procedure for submitting,
processing, and disposing of claims for benefits submitted by employees who participate in the
Retirement Plan, it does not actually set forth the claims process. See Defs.’ Ex. 3A § 11.10. Based
on the parties’ submissions, however, when an employee retires, WMATA transmits payroll and
employment information to the Retirement Plan Committee, which then, in accordance with the Plan
Document, issues a benefits determination. See Pl.’s Decl. ¶ 7; see also Defs.’ Ex. 3A § 11.03. A
key component of the benefits determination is the average compensation the employee earned
during each of his or her final three years of employment (“Final Average Earnings”). Defs.’ Ex. 3A
§ 13.15. An employee that is dissatisfied with the benefits determination may file a claim with the
Retirement Plan Committee. See Defs.’ Br. at 3. If the Retirement Plan Committee denies the claim,
the employee can appeal to Trustees. Id. This appeal is heard as a formal hearing, is held on the
-3-
record, and is the final level of administrative review for benefits decisions. Id.; see Defs.’ Statement
of Material Facts As To Which There Is No Genuine Dispute (“Defs.’ SMF”) ¶¶ 7-10.2
To determine plaintiff’s Final Average Earnings, the Retirement Plan Committee relied on
information provided by WMATA. See Pl.’s Decl. ¶¶ 7-8. With respect to the backpay plaintiff
received under the Settlement Agreement, the Retirement Plan Committee retroactively allocated the
backpay amount over the entire ten-year period covered by the Settlement Agreement. Defs.’ SMF ¶
8. The backpay, which plaintiff received in March 2002, Pl.s’ Br. at 5, was not spread evenly among
the ten years, but was instead apportioned based on what salary plaintiff would have earned in each
year he had received the promotions he claims WMATA unlawfully denied him. Defs.’ Br. at 3 n.3.
The effect of this allocation was that a greater percentage of the backpay was allotted to plaintiff’s
final three years of employment than if the backpay had been equally spread over all of the years
governed by the settlement agreement. See Defs.’ Ex. 3F at 6:21-11:3, 17:15-18:7 (Jan. 23, 2003).
This allocation did not affect how much money plaintiff received as salary during his final three years
of employment, nor did it affect how much money he received under the Settlement Agreement, but
it did affect the computation of his Final Average Earnings. Id. Had the entire amount of the
backpay been factored into his Final Average Earnings, the amount of his monthly benefit would
have been higher. Compl. ¶ 40.
2
While plaintiff alleges that defendants failed to follow these procedures, Pl.’s Decl. ¶¶ 7-11, he does
not seem to dispute that this was the general process to be followed.
-4-
Plaintiff contends that this computation was unlawful. Compl. ¶ 1. He maintains that the
backpay constituted “compensation” within the meaning of the Plan Document and thus should have
been included, in its entirety, in his Final Average Earnings. Pl.’s Br. at 5-6. Plaintiff has followed
the prescribed administrative procedure—first filing a claim with the Retirement Plan Committee and
then an appeal with the Trustees—and now turns to the Court for relief. Id. at 6-10. He alleges that
defendants were motivated by “willful malice” and “hatred,” and describes a conspiracy by which
defendants acted in concert to deliberately cause plaintiff’s monthly pension amount to be less than it
would were it accurately computed in accordance with the Plan Document and the Trust Agreement.
Id. at 2, 5-10. Specifically, plaintiff contends that the Retirement Plan Committee failed to follow
proper procedures in calculating his pension amount, id. at 8, that WMATA and the WMATA
defendants improperly interfered with the Retirement Plan Committee’s decision, id. at 9, and that the
Trustees did not afford him a fair hearing, id. at 19. Plaintiff also alleges improper self-dealings
between WMATA, the WMATA Defendants, the Retirement Plan Committee, and the Trustees. Id.
at 16-18, 20.
II. Legal Standard
Defendants have moved for summary judgment under Federal Rule of Civil Procedure 56. If
the submissions to the Court demonstrate that there is no genuine issue as to any material fact, the
moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56. A dispute about a
material fact is genuine “if the evidence is such that a reasonable jury could return a verdict for the
nonmoving party.” Calhoun v. Johnson, 632 F.3d 1259, 1261 (D.C. Cir. 2011) (quoting Anderson v.
Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). To succeed on its motion, the moving party need not
-5-
produce evidence to demonstrate the lack of material facts at issue, but may instead merely point to
the lack of evidence before the court to support the non-moving party’s case. Celotex Corp. v.
Catrett, 477 U.S. 317, 325 (1986).
While a court considering summary judgment must view all of the evidence in the light most
favorable to the non-moving party, Matsushita Electrical Industrial Co. v. Zenith Radio Corp., 475
U.S. 574, 587 (1986), the non-moving party may not simply make conclusory allegations
unsupported by specific evidence. Lujan v. Nat’l Wildlife Fed’n, 497 U.S. 871, 902 (1992). Instead,
summary judgment is appropriate where there is no factual basis in the record to suppose the
assertions made by the non-moving party. See Ass’n of Flight Attendants—CWA v. U.S. Dep’t of
Transp., 564 F.3d 462, 465-66 (D.C. Cir. 2009).
III. Analysis3
A. Plaintiff Has Failed to State a Claim Under ERISA Because ERISA Does Not Apply
to Governmental Plans
Plaintiff brings two ERISA claims against the Trustees: Count V to recover benefits due
under the Retirement Plan and Count VI for breach of fiduciary duty. Defendants argue that the
Retirement Plan is a governmental plan, and that ERISA does not apply to government plans.
Congress enacted ERISA “to provide uniform federal regulation of employee retirement
benefit plans and to make regulation of benefits an entirely federal concern.” Nat’l Rehab. Hosp. v.
Manpower Int’l, Inc., 3 F. Supp. 2d 1457, 1459 (D.D.C. 1998). To achieve this end, the statute
3
Plaintiff was without counsel when he initiated this action, so the Court liberally construes the
Complaint. Erickson v. Pardus, 551 U.S. 89, 94 (2007).
-6-
reserves “to Federal authority the sole power to regulate the field of employee benefit plans.” Shaw
v. Delta Air Lines, Inc., 463 U.S. 85, 99 (1983) (citing legislative history). ERISA’s broad reach,
however, does not extend to plans maintained by a state government, a political subdivision of a state,
or an instrumentality of a state. 29 U.S.C. § 1002(32) (2012); see Hisler v. Gallaudet Univ., 344 F.
Supp. 2d 29, 41 (D.D.C. 2004).
Courts in this circuit and in the Fourth Circuit have held that the WMATA Retirement Plan is
exempt from ERISA. Akins v. Washington Metro. Area Transit Auth., 729 F. Supp. 903, 905 n.1
(D.D.C. 1990) (“ . . . WMATA is a governmental entity and therefore exempt from the applicable
ERISA provisions.”); Canady v. Washington Metro. Area Transit Auth., 909 F. Supp. 324, 327 (D.
Md. 1995) (“ERISA preemption does not apply because the [WMATA Retirement Plan] falls under
ERISA’s governmental plan exception”) (internal quotation omitted); see also D.C. Code § 9-1107(2010) et seq. (WMATA is a governmental agency established by interstate compact).
Plaintiff acknowledges these authorities, but insists that the Retirement Plan is not a
governmental plan within the meaning of ERISA. He urges first that the Retirement Plan cannot be a
governmental plan because it neither was established nor is maintained by WMATA, and instead
operates independently of WMATA. He is incorrect: the Plan Document makes clear that WMATA
maintains the Retirement Plan. Defs.’ Ex. 3A p.1 (“This Retirement Plan . . . adopted by
[WMATA] . . . constituted a complete restatement and continuation of the WMATA Retirement
Trust maintained by [WMATA] for [its] employees . . . .); id. § 2.03 (“[t]hat portion of the entire cost
of the Plan which is not funded by investment earnings shall be paid by [WMATA] for all
Participants”); cf. Feinstein v. Lewis, 477 F. Supp. 1256, 1260 (S.D.N.Y. 1976) (municipal and
-7-
school district employee welfare plans established in conjunction with labor unions are still
governmental plans within the meaning of ERISA). Even if plaintiff was correct that Atkins and
Canady do not bar his ERISA claims, his argument that the Retirement Plan is not actually a
governmental plan would still fail because it is contrary to the clear terms of the Plan Document.
Next, plaintiff argues that, if the Court holds that the Retirement Plan is exempt from the
requirements of ERISA, then the Retirement Plan will be left with no oversight, and will be allowed
“to be its own final authority.” Pl.’s Br. at 15. This argument fares no better than the first. It may be
true that construing the Retirement Plan as a governmental plan means that it will not be subject to
federal oversight. But Congress clearly specified that governmental plans are not subject to ERISA,
29 U.S.C. § 1002(32) (2012), see Shaw, 463 U.S. at 99, and the Court declines plaintiff’s invitation to
disturb that policy pronouncement.
Plaintiff offers no justification for challenging the authorities that have held that the
Retirement Plan is not subject to ERISA, and for this reason summary judgment must be granted to
defendants on plaintiff’s ERISA claims.4
B. Plaintiff’s Title VII Claims Fail Because Plaintiff Has Not Produced Any Evidence
Demonstrating a Legally Sufficient Causal Nexus Between any Alleged Protected
Activity and the Determination of His Pension Claims
In Count VII plaintiff has alleged retaliation in violation of Title VII by WMATA, and in
Count VIII plaintiff pleads retaliation by the Retirement Plan Committee. Count IV is styled as a
4
Even if the Court held that the Retirement Plan was not a governmental plan under ERISA,
plaintiff’s claims would still fail because plaintiff has not shown an abuse of discretion on the part of
the Retirement Plan Committee or the Trustees. Infra Part III-E.
-8-
breach of contract claim in which plaintiff alleges that WMATA breached the anti-retaliation
provision of the Settlement Agreement by actively undermining plaintiff’s efforts to receive what he
believes is the appropriate monthly pension benefit.5 Defendants argue that summary judgment is
appropriate on these claims because plaintiff has offered no facts, evidence, or testimony
demonstrating a legally sufficient causal nexus between plaintiff’s protected activity and the
allegedly retaliatory conduct.
“To establish a prima facie case of retaliation, a plaintiff must show that (1) he engaged in a
statutorily protected activity, (2) a reasonable employee would have found the challenged action
materially adverse, and (3) there existed a causal connection between the protected activity and the
materially adverse action.” Pierson v. Washington Metro. Area Transit Auth., 821 F. Supp. 2d 360,
368 (D.D.C. 2011) (quoting Burlington N. & Santa Fe Ry. Co. v. White, 548 U.S. 53, 67-69 (2006)).
Causality can be inferred from a reasonable temporal proximity between the protected activity and
the retaliatory conduct. See Gustave-Schmidt v. Chao, 360 F. Supp. 2d 105, 118-19 (D.D.C. 2004).
An employer may offer a “some legitimate, non-[retaliatory] reason” for the adverse action, Texas
Department of Community Affairs v. Burdine, 450 U.S. 248, 252 (1981), after which the Court must
assess “whether a reasonable jury could infer retaliation from all the evidence.” Jones v. Bernanke,
557 F.3d 670, 677 (D.C. Cir. 2009).
5
Count IV is not technically a Title VII claim. However, since this Count turns on the same question
presented by the Title VII claims—did defendants commit retaliation?—the Court will assess Count
IV alongside plaintiff’s Title VII claims. Defendants made a such a characterization of this claim in
their brief, Defs.’ Br. at 11-13, and plaintiff did not object. Pl.s’ Br. at 20-22.
-9-
Count VIII can be dismissed at the outset. Title VII prevents employers from engaging in
discriminatory conduct against employees. To meet the statutory definition of “employee,” there
must be some employment relationship between the employer and the aggrieved party. 42 U.S.C. §
2000e(f) (2012); see Schmidt v. Shah, 696 F. Supp. 2d 44, 66-67 (D.D.C. 2010) (“ . . . [plaintiff] was
no longer employed by [defendant] when he submitted the materials to the EEO investigation and
therefore does not qualify as an ‘employee’ under Title VII”). Count VIII is asserted against the
Retirement Plan. Plaintiff did not work for the Retirement Plan at any point relevant to this lawsuit.
Compl. ¶ 3. Consequently, plaintiff was not an “employee” of the Retirement Plan, and cannot bring
a claim for retaliation against that particular defendant.
With respect to Counts IV and VII, defendants argue that plaintiff’s retaliation claims fail
because plaintiff has not adduced any facts from which an inference of causation can be drawn
between the allegedly retaliatory conduct at issue and plaintiff’s prior protected activity and because
a reduction in pension benefits is not an adverse employment action within the meaning of Title VII.
Here, the protected activity claimed by plaintiff is the signing of the Settlement Agreement on
November 6, 2001, and the allegedly retaliatory conduct was the Trustees’ February 7, 2003 decision
denying plaintiff’s benefits appeal. Even if the execution of a settlement agreement can constitute a
protected activity, and even if the alleged reduction in his pension benefits constitutes a materially
adverse action, plaintiff’s claims fail because he has offered no evidence at all demonstrating a causal
nexus between the execution of the Settlement Agreement and the reduction in the pension benefits.
He relies instead on conclusory allegations, but these are insufficient to withstand summary
judgment.
- 10 -
Nor can plaintiff allege causation by temporal proximity, because nearly fifteen months
elapsed between his execution of the Settlement Agreement and the Retirement Plan’s decision to
deny his pension claim. See Gustave-Schmidt 360 F. Supp. 2d at 118-19 (three months is the outer
limit for a temporal showing of causation). In his opposition brief, plaintiff refers to a “long series of
communications including emails, memos, letters, internal complaints, etc.” that occurred in
December 2001, during and throughout much of 2002, and during January and March 2003 that were
discriminatory and retaliatory. But these claims, unsupported by any document produced or
testimony offered as part of the discovery process, are insufficient to withstand a motion for summary
judgment. Ass’n of Flight Attendants, 564 F.3d at 465-66.
Because plaintiff was never an employee of the Retirement Plan, defendants are entitled to
summary judgment on Count VIII, and because plaintiff has offered nothing but conclusory
statements in support of his other retaliation claims, summary judgment is also appropriate with
respect to Count IV and Count VII.
C. Plaintiff’s Tort Claims Against the Individual WMATA Defendants Are Barred by
the Doctrine of Sovereign Immunity
In Count II and Count IX, plaintiff asserts claims for breach of trust and “tortious
interferences with trust relationship,” respectively, against WMATA, the individual WMATA
defendants, and individual Trustees. Defendants argue that to the extent these claims seek relief from
individual WMATA employees, those claims are barred by the doctrine of sovereign immunity.
The Eleventh Amendment to the Constitution bars suits by private parties against a state
agency, absent a valid abrogation of immunity by Congress or waiver of immunity by the state or
state agency. See Alden v. Maine, 527 U.S. 706, 728, 755-756 (1999). Section 80 of the Compact
- 11 -
creating WMATA “waives [WMATA’s] sovereign immunity for torts committed in the conduct of
any proprietary function, while retaining immunity for torts committed by its agents in the
performance of a governmental function.” Beebe v. WMATA, 129 F.3d 1283, 1287 (D.C. Cir. 1997)
(internal quotation omitted). The immunity determination “often turns on whether the activity is
‘discretionary’ or ‘ministerial’ . . . .” Id. If the activity is discretionary and is “grounded in social,
economic or political goals,” then the activity is governmental and is shielded by sovereign
immunity. Id.Defendants argue that plaintiff’s tort claims as asserted against the WMATA defendants fail
because they are the beneficiaries of WMATA’s sovereign immunity. Defendants point to a line of
cases in which Courts have held that employment, salary, and benefits decisions made by WMATA
are the sort of decisions to which the Compact’s retention of sovereign immunity applies. See
Burkhart v. Washington Metro. Area Transit Auth., 112 F.3d 1207, 1217 (D.C. Cir. 1997) (“ . . . the
hiring, training, and supervision of WMATA personnel are governmental functions”); Lombard v.
Washington Metro. Area Transit Auth., No. 01-2475 (D.D.C. Feb. 21, 2003) (individual WMATA
defendants enjoyed sovereign immunity in contract and tort case alleging that WMATA incorrectly
calculated plaintiff’s benefits eligibility and provided plaintiff an incorrect retirement estimate);
Smith v. Washington Metro. Area Transit Auth., No. 95-068, 1997 WL 182286, at *4 (D.D.C. Apr. 7,
1997) (”[p]laintiff fails to cite, and the court is not aware, of a single case in which WMATA has
been held liable for torts arising from the administration of its personnel system”).
Plaintiff attempts to distinguish the cases on which defendants rely by citing Barbour v.
Washington Metropolitan Area Transit Authority, 374 F.3d 1161 (D.C. Cir. 2004). There, the D.C.
- 12 -
Circuit considered whether the trial court properly rejected WMATA’s contention that it enjoyed
immunity from plaintiff’s claims under Section 504 of the Rehabilitation Act. The Court of Appeals
upheld the trial court’s determination that WMATA was not immune. Id. at 1170. The majority
quoted the Civil Rights Remedies Equalization Act:
[a] state shall not be immune under the Eleventh Amendment of the Constitution of
the United States from suit in Federal court for a violation of section 504 of the
Rehabilitation Act of 1973, title IX of the Education Amendments of 1972, the Age
Discrimination Act of 1975, title VI of the Civil Rights Act of 1964, or the provisions
of any other Federal statute prohibiting discrimination by recipients of Federal
financial assistance.
Id. at 1164 (quoting 42 U.S.C. § 2000d-7(a)(1) (2006)).
Plaintiff argues that Barbour undermines the prior cases in which courts held that WMATA’s
personnel practices fell outside the scope of its sovereign immunity. This argument is incorrect.
Barbour addressed a specific provision of a specific federal law that indicated specific instances in
which sovereign immunity was waived with respect to an identified federal statute. Plaintiff claims
that, because WMATA did not retain its immunity in Barbour, it must necessarily have waived it
here, but that argument simply ignores Barbour’s factual context. The plaintiff here does not allege
that WMATA receives federal funds (unlike in Barbour) and, even if he did, he points to no federal
statute which conditions the receipt of those funds on WMATA’s waiver of sovereign immunity (also
unlike in Barbour). Barbour is therefore inopposite.
Next, plaintiff claims that the conduct of the WMATA defendants was so egregious that those
employees cannot be shielded by WMATA’s sovereign immunity. He asserts that “most of the
individual Defendants intentionally acted and/or participated with others in continued malice, hatred,
retaliation, negligence, failure to perform their official duties for the benefit of beneficiaries,
- 13 -
fiduciary duties, etc. in violation of federal and D.C. law.” Pl.’s Br. at 15-16. He then recounts the
extensive list grievances he asserts he suffered at the hands of the WMATA defendants, and argues
that sovereign immunity simply cannot extend to such conduct. Id. at 17-18. Whether sovereign
immunity would be waived were these allegations true is a question the Court need not reach,
because plaintiff has offered no documents, testimony, or any evidence of any sort to support these
allegations. There simply is no factual basis in the record to sustain plaintiff’s allegations, and
summary judgment is therefore appropriate. Ass’n of Flight Attendants, 564 F.3d at 465-66.
In light of the authorities holding that WMATA enjoys sovereign immunity when it engages
in discretionary hiring, employment decisions, and decisions regarding “pension and retirement,”
Burkhart, 112 F.3d at 1209, and in light of plaintiff’s failure to point to any factual basis in the record
to sustain his claims, the Court will grant defendants’ motion for summary judgment with respect to
Counts II and IX as to the individual WMATA defendants.
D. Plaintiff’s Remaining Claims Against WMATA and the Trustees Are Barred by the
Language of the Plan Document and Trust Agreement
Plaintiff has asserted an assortment of claims against WMATA and the Trustees: Count I for
breach of fiduciary duty against the Trustees; Count II for breach of trust against WMATA and the
Trustees; Count III for breach of fiduciary duty against the Trustees; and Count IX for “tortious
interferences with trust relationship” against WMATA and the Trustees.6
6
Plaintiff’s claims under Count II and Count IX against the Retirement Plan Committee are
addressed separately. Infra Part III-E.
- 14 -
Defendants argue that all of these claims are barred by the language governing the Retirement
Plan. In support of this contention, they cite to the Plan Document and the Trust Agreement.
According to section 12.10 of the Plan Document:
[t]he Committee, the Trustees, employees of the Authority or officers or
members of the Board of Directors of the Authority will not be liable to any
person, business entity, or government agency by reason of the terms,
conditions, or agreements contained in the Plan or in the Agreement executed in
connection herewith. The Board of Directors, officers, employees or the Authority,
the Committee, and the Trustees will be entitled to rely upon any and all certificates
and report or opinions given by any duly appointed accountant, actuary, investment
advisor or legal counsel (who may be counsel for the Authority), and will be fully
protected against any action taken in good faith in reliance upon such tables,
valuation, certificates, reports or opinions.
Defs.’ Ex. 3A § 12.10 (emphasis added).
Defendants also quote from the Trust Agreement:
[i]t is expressly understood and agreed by each employee who becomes a Participant
hereunder, that except for its or their willful neglect or fraud, neither the
Authority nor the Trustees shall be in any way subject to any suit or litigation,
or to any legal liability for any cause or reason or thing whatsoever, in
connection with this Trust or its operations, and each such employee hereby
releases the Authority and all of its officers and agents from any and all liability or
obligation.
Defs.’ Ex. 3B § 10.10 (emphasis added).
Plaintiff contends that the Plan Document supports his position, and similarly directs the
Court to section 12.10, though he emphasizes its latter portion:
. . . [t]he Board of Directors, officers, employees or the Authority, the Committee,
and the Trustees will be entitled to rely upon any and all certificates and report or
opinions given by any duly appointed accountant, actuary, investment advisor or
legal counsel (who may be counsel for the Authority), and will be fully protected
- 15 -
against any action taken in good faith in reliance upon such tables, valuation,
certificates, reports or opinions.
Defs.’ Ex. 3A § 12.10 (emphasis added).
Plaintiff also cites two provisions of the Trust Agreement and asserts that they create liability
to the extent that defendants failed to act in good faith:
[t]he Trustees shall not be liable for the making, retention or sale of any investment or
reinvestment made by them, as herein provided, nor for any loss to, or diminution of,
the Trust, unless due to their own negligence, willful misconduct, or lack of good
faith.
* * * *
[t]he Trustees shall be fully protected in relying upon a certification by [WMATA]
and shall be fully protected in acting upon any instrument, certificate or paper
believed by them to [illegible in original document] and to be signed or presented by
the proper person or person, and the Trustees shall be under no duty to make any
investigation or inquiry as to any statement contained in any such writing, but may
accept the same as conclusive evidence of the truth and accuracy of the statements
therein contained.
Defs.’ Ex. 3B §§ 7.01, 7.02.
Essentially, defendants contend that they can be liable under the Plan Document and Trust
Agreement only for “willful neglect or fraud,” Defs.’ Br. at 10, while plaintiff urges that defendants
can be held liable for any action not taken in good faith. Pl.’s Br. at 20.
Despite the assertions of the parties, section 12.10 of the Plan Document has no bearing on
this dispute. The clear terms of the provision suggest that it relates to investment decisions made by
or on behalf of the Retirement Plan, rather than to disputes between WMATA, the Retirement Plan,
the Trustees, and Plan Participants, and, in fact, this provision does not even mention the Plan
Participants at all. Moreover, the second part of section 12.10 addresses the right of WMATA, its
employees, and the Trustees to rely on “all certificates and reports or opinions given by any duly
- 16 -
appointed accountant, actuary, investment officer, or legal counsel.” Defs.’ Ex. 3A § 12.10. While
this section does protect those who administer the Retirement Plan, it does so when they act in
reliance on advice or information they receive from investment advisors. That protection has no
bearing on the claims plaintiff has asserted here.
For similar reasons, the Court rejects plaintiff’s reliance on sections 7.01 and 7.02 of the Trust
Agreement. Section 7.01 explicitly limits its liability language to the “making, retention, or sale of
any investment or reinvestment . . . .” Defs.’ Ex. 3B § 7.01. Here, plaintiff is not challenging the
making, retention, or sale of any investment or reinvestment by or to the Trustees. Nor is section
7.02 relevant to this dispute. This section does not even speak of duties owed by the Trustees; it
simply provides that they are free to rely on certifications issued by WMATA or its employees. See
id. § 7.02.
Defendants’ reliance on section 10.10 of the Trust Agreement, however, is proper. Under this
provision, a suit by a Plan Participant against WMATA and its employees or the Trustees cannot lie
but for willful neglect or fraud on the part of WMATA, its employees, or the Trustees. The section
contains language that was not present section 12.10 of the Plan Document or section 7.01 of the
Trust Agreement. It speaks specifically of lawsuits by Plan Participants, it is not limited to a certain
type of litigation or lawsuit, and it specifies that the liability limitation reaches any “cause or reason
or thing whatsoever, in connection with this Trust or its operation.” Defs.’ Ex. 3B § 10.10. By its
clear terms it exempts the Trustees as well as WMATA and its employees from liability except for
their willful neglect or fraud. As a result, the Trust Agreement bars suit against defendants that arise
- 17 -
from the operation of the Retirement Plan unless plaintiff can demonstrate that defendants acted with
willful neglect or fraud.
Plaintiff has not met this burden. Here, he asserts that some defendants “repeatedly and
maliciously interfered with” his efforts to enhance his pension. Pl.s’ Br. at 19. He further claims that
defendants acted with “bias, discrimination, retaliation, hatred, malice and negligence,” and
maintains that he was the victim of a conspiracy between defendants to artificially and unlawfully
decrease his monthly pension amount. Id. at 17-19. But these are no more than conclusory
allegations that lack any documentary, evidentiary, or testimonial support, and summary judgment is
appropriate when no such support is offered.
Plaintiff does refer to the transcript of the January 23, 2003 Retirement Benefits Appeal
Hearing, and claims that the events of that day indicate that at least one of the Trustees was unfairly
biased against him. Pl.’s Br. at 19. The Court has reviewed the transcript of this proceeding, Defs.’
Ex. 3F, and holds that, while the hearing was occasionally contentious, it does not evidence bias
against or hostility toward plaintiff, and it therefore cannot insulate his claims from summary
judgment.
The willful neglect or fraud standard, however, does not apply to plaintiff’s claims against the
members of the Retirement Plan Committee. Section 10.10 of the Trust Agreement, by its clear
terms, limits its protections to the Trustees and to WMATA and its officers and agents. Defs.’ Ex.
3B § 10.10. This limitation says nothing about the Retirement Plan or the members of the Retirement
Plan Committee. That the Retirement Plan Committee is not mentioned in section 10.10 is all the
more conspicuous in light of sections of the Plan Document that do expressly mention the Retirement
- 18 -
Plan Committee. E.g., Defs.’ Ex. 3A § 12.10 (describing liability limitations with respect to the
Retirement Plan Committee, the Trustees, WMATA, and WMATA’s officers and board of directors).
Because plaintiff offers no proof of his claims, and instead offers no more than conclusory
allegations, summary judgment for defendants is appropriate on Count I, Count II with respect to
WMATA and the Trustees, Count III, and Count IX with respect to WMATA and the Trustees.
E. Plaintiff’s Claims Against the Retirement Plan Committee Fail Because the
Retirement Plan Committee’s Decision was not Arbitrary and Capricious
Plaintiff’s remaining claims are Count II for breach of trust and Count IX for “tortious
interferences with trust relationship,” both asserted against the Retirement Plan Committee
defendants. Defendants seek summary judgment on both counts, arguing that the Retirement Plan
defendants cannot be liable because the Retirement Plan Committee’s decision was not arbitrary and
capricious.
With respect to Count II, as the Retirement Plan is a governmental plan and thus not subject
to ERISA, the Court will apply the laws of the District of Columbia in assessing defendants’ motion.
Defs.’ Ex. 3A § 12.11 (specifying that the Retirement Plan shall be administered in accordance with
the laws of the District of Columbia); accord Canady v. Washington Metro. Area Transit Auth., 909
F. Supp. 324, 327 (D. Md. 1995) (applying state law in resolving WMATA Retirement Plan pension
dispute). The District of Columbia follows the Restatement of Trusts to the extent that the D.C. Code
and caselaw in the District of Columbia are otherwise silent. See Wright v. Sony Pictures Entm’t,
Inc., 394 F. Supp. 2d 27, 33 (D.D.C. 2005). The Court has found neither a provision of the D.C.
Code nor caselaw from the District supplying a standard for breach of trust claims, so it will adhere to
the definition contained in the Restatement (Second) of Trusts.
- 19 -
Under that Restatement, which was in effect when plaintiff’s claims arose, “a breach of trust
is a violation by the trustee of any duty which as trustee he owes to the beneficiary”. Restatement
(Second) of Trusts § 201 (1959). “Where discretion is conferred upon the trustee with respect to the
exercise of a power, its exercise is not subject to control by the court except to prevent an abuse by
the trustee of his discretion.” Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 111 (1988)
(quoting Restatement (Second) of Trusts § 187 1959). A trustee’s decision is reasonable and, thus,
not an abuse of discretion, if it was the result of a deliberate reasoning process and is supported by
substantial evidence. Buford v.UNUM Life Ins. Co. of Am., 290 F. Supp. 2d 92, 99-100 (D.D.C.
2003).
Here, plaintiff alleges that the clear terms of Trust Agreement imposed a duty on Retirement
Plan Committee to act primarily for the benefit of Retirement Plan Participants, and that the
Retirement Plan Committee failed to meet that standard when it awarded plaintiff a pension that did
not capture the full amount of the backpay he received from WMATA prior to his retirement. Pl.’s
Br. at 22.
For two reasons, the Court rejects plaintiff’s argument. First, while plaintiff maintains that
the members of the Retirement Plan Committee acted so negligently that they “miserably” failed in
their duties under the Trust Agreement, Pl.’s Br. at 22, he provides no factual evidence, documents,
or testimony that would support his allegations, and the Court will not allow the breach of trust claim
to proceed in the absence of even a scintilla of evidence to sustain plaintiff’s allegations.
Second, plaintiff maintains that the language of the Plan Document and the Trust Agreement
are so clear that any failure to award him his desired pension necessarily constitutes a breach of trust.
- 20 -
Pl.’s Br. at 22-25. At issue here is the Plan Document’s definition of compensation: “ . . . the total
basic compensation (excluding any overtime payments, special shift payments, bonuses, or other
allowances) received by a Participant from [WMATA] during any calendar month.” Defs.’ Ex. 3A §
13.09.
The Court rejects plaintiff’s argument that the language of the Plan Document clearly compels
the conclusion that he is entitled to have the full amount of the backpay he received included in his
Final Average Earnings. The Plan Document defines compensation as basic compensation, except
for four categories of payments which are not compensation. Defs.’ Ex. 3A § 13.09. Whether these
four exclusions represent the entire universe of payments from WMATA to an employee that are not
compensation rather than representing merely four examples of types of payments that are not
compensation, the Plan Document does not say. Nor does the Plan Document explain how, if at all,
the word “basic” as used in section 13.09 modifies the meaning of compensation. Presumably it
does, otherwise that word would not be in the definition, but there is nothing in the Plan Document to
suggest how compensation and basic compensation might differ. The Court makes these
observations to point out that the meaning of “compensation” as used in the Plan Document is not
nearly as obvious or so clear as plaintiff attempts to characterize it.
Ultimately, the Retirement Plan Committee (and the Trustees) decided that a lump-sum
backpay payment attributable to allegedly discriminatory conduct that predated plaintiff’s claim for
benefits by nearly a decade was not basic compensation within the meaning of the Plan Document.
Defs.’ Ex. 3G. This interpretation of the Plan Document is reasonable on its face. While plaintiff
observed that the Retirement Plan Committee was to act for the benefit of the Plan Participants, Pl.s’
- 21 -
Br. at 22, his argument ignores that the Plan Document also requires that the Retirement Plan
Committee to award Plan Participants only the benefits to which they are entitled. Defs.’ Ex. 3A §
11.03. Accepting plaintiff’s claims would require imbuing the Retirement Plan Committee with an
obligation to maximize a Plan Participant’s monthly pension benefit, even at the expense of deviating
from their duties to interpret and administer the Retirement Plan in accordance with the Plan
Documents.
The retroactive allocation of plaintiff’s backpay had the approximate effect of yielding a Final
Average Earnings—and, thus, a monthly pension amount—that plaintiff would have received had the
allegedly discriminatory conduct at issue in his prior Equal Employment Opportunity action not
occurred. The backpay allocation, in other words, made him whole respect to his monthly pension
benefit. Before the Retirement Plan Committee and the Trustees and, now, before the Court, he seeks
a windfall, to receive a substantially higher monthly pension benefit than he would have received if
WMATA had not allegedly discriminated against him in the past. The Retirement Plan Committee
and the Trustees rejected this claim, and so does the Court.
With respect to Count IX, the Court is unaware of any statutory or common law claim for
“tortious interferences with trust relationship” and, in any event, tortious interference claims (as, for
example, with contractual relations or with prospective economic benefit) typically arise when a third
party interferes with a contract or relationship already established between two other parties. E.g.,
Hunt v. District of Columbia, 66 A.3d 987, 993 (D.C. 2013) (“the tort of interference with contractual
relations does not lie when the defendant itself is a party to the contract”). Here, the Retirement Plan
Committee is required to “direct [its] duties with respect to the Plan solely in the interest of the Plan’s
- 22 -
participants and beneficiaries for the exclusive purpose of providing benefits to the Plan’s
Participants and beneficiaries . . . .” Defs.’ Ex. 3A § 11.03. Just as a defendant cannot tortiously
interfere with a contract to which it is a party, the Retirement Plan Committee cannot tortiously
interfere with its own relationship with plaintiff.
CONCLUSION
For the reasons set forth in this Memorandum Opinion, the Court will GRANT defendants’
Motion for Summary Judgment [ECF No. 53]. An appropriate order will accompany this
Memorandum Opinion.
July 17, 2014 _____________________________
Thomas F. Hogan
Senior United States District Judge
- 23 -