Stephens v. US Airways Group, Inc.

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued May 6, 2011 Decided July 15, 2011

No. 10-7100

JAMES C. STEPHENS AND RICHARD MAHONEY,

APPELLANTS

v.

US AIRWAYS GROUP, INC., ET AL.,

APPELLEES

Appeal from the United States District Court

for the District of Columbia

(No. 1:07-cv-01264)

Jacks C. Nickens argued the cause for appellants. With

him on the briefs was Robert P. Trout. Paul D. Flack entered

an appearance.

Jean M. Breen argued the cause for appellee Pension

Benefit Guaranty Corporation. With her on the brief were

Israel Goldowitz, Stephanie L. Thomas, Mark R. Snyder, and

Colin B. Albaugh.

2

Before: HENDERSON, BROWN and KAVANAUGH, Circuit

Judges.

Opinion for the Court filed by Circuit Judge BROWN.

Opinion concurring in the judgment filed by Circuit

Judge KAVANAUGH.

Opinion dissenting in part filed by Circuit Judge

HENDERSON.

BROWN, Circuit Judge: James Stephens and Richard

Mahoney (collectively “Plaintiffs”) are retired U.S. Airways

pilots. Each received pensions from the U.S. Airways

pension plan (“the Plan”). And each opted to receive his

pension in a single lump sum rather than as an annuity. The

Plan paid those lump sums 45 days later than Plaintiffs would

have received their first checks had they chosen the annuity

option. Plaintiffs sued U.S. Airways, claiming the Plan owed

them interest for its 45-day delay. The district court

disagreed. We now reverse in part and affirm in part,

remanding for further consideration consistent with this

opinion.

I

James Stephens and Richard Mahoney retired from their

jobs as U.S. Airways pilots in 1996 and 1999, respectively.

Both pilots qualified for a pension under the U.S. Airways

pension plan. The Plan’s default pension was an annuity, to

be paid in monthly installments. But the Plan also allowed a

retiree to receive his pension as a single lump sum payment

actuarially equivalent to the projected value of all annuity

payments. Plaintiffs chose to receive their pensions as lump

sums.

3

The Plan provided that annuity payments would begin on

the first day of the month after the pilot retired (and

retirement was mandatory at age 60). If the retiring pilot

elected the lump sum option, however, the Plan did not

actually pay that lump sum until 45 days after the first day of

the month after the pilot retired. In other words, the Plan paid

lump sum pensions 45 days later than Plaintiffs would have

received their first payments had they selected the annuity

option. U.S. Airways claimed this delay was administratively

necessary because of additional calculations and precautions

it takes when issuing lump sums. Important to the present

dispute, the delayed lump sum payments did not include any

interest for the 45 days that elapsed between the annuity start

date and the date lump sum recipients actually received their

payments.

Stephens and Mahoney each received their lump sum

pensions 45 days after their annuity start date. Stephens

received $488,477.22. Mahoney received $672,162.79.

Applying the 6.25% interest rate suggested by Plaintiffs’

expert, Stephens should have received $3,665.06 in interest

on his lump sum payment for the 45-day delay, and Mahoney

should have received $5,043.25 in interest on his payment.

In 2000, Stephens and Mahoney sued U.S. Airways for

the interest on the 45 day delay. According to Plaintiffs, U.S.

Airways’ refusal to pay interest violated the Employee

Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et

seq. (“ERISA”), which requires the Plan’s lump sum

payments to be the “actuarial equivalent” of the Plan’s

annuity payments. 29 U.S.C. § 1054(c)(3). Plaintiffs

separately alleged that the terms of the Plan required U.S.

Airways to pay lump sums on the annuity start date.

4

Plaintiffs initially sued U.S. Airways in the U.S. District

Court for the Northern District of Ohio. In 2003, the Plan was

terminated due to U.S. Airways’ bankruptcy, and the Pension

Benefit Guaranty Corporation (“PBGC”) became the Plan’s

trustee. See id. § 1342. In 2007, the case was therefore

transferred to the U.S. District Court for the District of

Columbia.

In two decisions—the first on a motion to dismiss and the

second on a motion for summary judgment—the district court

rejected all of plaintiffs’ claims. We review those decisions

de novo. See Winder v. Erste, 566 F.3d 209, 213 (D.C. Cir.

2009).

II

Plaintiffs claim the lump-sum payments they received

were worth less than annuities they could have received under

the Plan, and therefore violated the actuarial equivalence

requirement of § 1054(c)(3). As they see it, U.S. Airways

calculated each lump-sum payment to be worth as much as

the annuity on the annuity start date, but then withheld

payment until 45 days after the annuity start date. According

to Plaintiffs, U.S. Airways thus owed them the interest on

their lump sums for the 45 days between the annuity start date

and the lump sum payment date. On the other hand, PBGC

argues it does not matter whether Plaintiffs actually received

their lump sum payments on the annuity start date so long as

the Plan accurately calculated lump sums that were equivalent

to the annuity at the time they were calculated.

ERISA establishes minimum standards for private

pension plans. If a plan allows retirees to select a lump-sum

payment in lieu of an annuity—the lump sum payment “shall

be the actuarial equivalent” of the annual benefit. 29 U.S.C.

5

§ 1054(c)(3); see also Esden v. Bank of Boston, 229 F.3d 154,

163 (2d Cir. 2000) (noting that ERISA requires lump sum

payments to “be worth at least as much as that annuity”).

Although ERISA does not further define actuarial

equivalence, we assume Congress intended that term of art to

have its established meaning. See McDermott Int’l, Inc. v.

Wilander, 498 U.S. 337, 342 (1991). Two modes of payment

are actuarially equivalent when their present values are equal

under a given set of actuarial assumptions. See JEFF L.

SCHWARTZMANN & RALPH GARFIELD, EDUCATION &

EXAMINATION COMM. OF THE SOCIETY OF ACTUARIES,

ACTUARIALLY EQUIVALENT BENEFITS 1, EA1-24-91 (1991),

available at http://www.soa.org/files/pdf/edu-2009-fall-ea1-

02-sn.pdf. One such assumption is that payment begins on

the annuity start date.

Actuarial equivalence prohibits a lump-sum payment that

does not include the full value of the benefits a retiree would

otherwise receive if he were to receive his pension in the form

of an annuity. See Contilli v. Local 705 Int’l Bhd. of

Teamsters Pension Fund, 559 F.3d 720, 722 (7th Cir. 2009)

(concluding a plan’s lump-sum payment violated § 1054(c)(3)

because it failed to adjust for post-retirement, pre-application

benefits); Miller v. Xerox Corp. Retirement Income

Guarantee Plan, 464 F.3d 871, 874 (9th Cir. 2006) (same for

failure to adjust for previous distribution offsets). But

§ 1054(c) does not address whether (or to what extent)

interest is owed when an actuarially equivalent pension is

paid late. By comparison, § 1054(e)(3) requires a defined

benefit plan to repay distributions that improperly reduce

employee service credit with “interest at the rate determined

for purposes of subsection (c)(2)(C).” 29 U.S.C.

§ 1054(e)(3). Because there is no dispute U.S. Airways

accurately calculated Plaintiffs’ lump sums to be the

“actuarial equivalent” of the annuity option as of the annuity

6

start date, the lump sum payment does not violate

§ 1054(c)(3).

But a pension plan could not satisfy ERISA by correctly

calculating an actuarially equivalent lump sum, then delaying

payment of that sum indefinitely. To this end, an Internal

Revenue Service (IRS) regulation provides that “[a] payment

shall not be considered to occur after the annuity starting date

merely because actual payment is reasonably delayed for

calculation of the benefit amount if all payments are actually

made.” 26 C.F.R. § 1.401(a)-20 (Question & Answer

10(b)(3)); cf. Rose v. Long Island R.R. Pension Plan, 828 F.2d

910, 918 (2d Cir. 1987) (noting the IRS is “one of the

agencies charged with administering ERISA”). By

distinguishing the annuity starting date from the date of actual

payment, see id. (Question & Answer 10(b)(2)) (“The annuity

starting date is the first date for which an amount is paid, not

the actual date of payment.”), section 1.401(a)-20 bolsters our

conclusion that U.S. Airways’ late payment of Plaintiffs’

lump sums does not violate § 1054(c)(3). Nevertheless, the

IRS regulation permits only “reasonable delays” in payment.

The remaining question is whether U.S. Air’s 45-day

delay was reasonable. It was not. According to an analysis

U.S. Air conducted during the 1990s, calculation of a lump

sum payment took at most 21 business days: 7 to 10 business

days to complete data checks and benefit calculations, 2 to 3

business days to review the calculations and check for

qualified domestic relations, 3 to 5 business days to transmit a

check, and 3 business days to review the check. Twenty-one

business days corresponds to approximately one calendar

month. Aside from restating the process required to calculate

lump sum payments, PBGC makes no argument explaining

why Plaintiffs’ lump sums were additionally delayed. In the

absence of any contrary evidence, U.S. Air’s 45-day delay

7

appears unrelated to the administrative calculation of

Plaintiffs’ lump sum benefits. And, because the delay does

not correspond to administrative necessity, it is not

“reasonable.”1 See 26 C.F.R. § 1.401(a)-20 (Question &

Answer 10(b)(3)). Plaintiffs’ expert evidence that 45 days is

outside of the industry norm bolsters this conclusion. He said

that “in practice” pension plans deem delays of 30 days or

less—not 45 days—as “reasonable.”

The Dissent argues remanding this case “may well open

the courthouse doors to litigation over de minimis amounts of

interest accrued during a few weeks or even days.” Diss. Op.

at 3. But again, future plaintiffs may recover only interest

when lump-sum payments are unreasonably delayed. Plan

administrators may demonstrate in any given case a delay is

reasonable because it relates to the administrative calculation

of lump sum benefits—a task, undoubtedly, made more

difficult the longer the delay. In this way, the probability of

litigation is correlated with the length of delay. Settlement is

likely when delays are lengthy and difficult to tie to

administrative necessity; litigation is unlikely when delays are

small and any potential recovery may not cover the costs of

litigation. Thus, the flood the Dissent fears may amount to a

mere trickle. And to the extent the courthouse doors are open

to suits concerning sizable and unreasonable delays, they

should be.

1

The Dissent argues I “omit one important detail,” namely, that

“the pension plan administrator has to know the pilot’s ‘Final

Average Earnings.’” Diss. Op. at 2. But the Dissent’s conclusion

this calculation potentially takes 18 days is a red herring. That the

paycheck pilots receive on the 18th of every month “reflects actual

earnings for the month” says nothing of how long it took the Plan to

calculate those earnings. Moreover, given pilots’ mandatory

retirement on their 60th birthday, the Plan has notice of when a pilot

will retire and can plan accordingly.

8

In sum, Plaintiffs’ lump sums were the “actuarial

equivalent” of the annuity option under the Plan at the time of

the annuity start date. Because U.S. Air unreasonably delayed

payment, however, Plaintiffs are entitled to interest.

III

Plaintiffs also argue they are entitled to attorney’s fees.

The default “American rule” is that the prevailing party does

not receive attorney’s fees. To receive attorney’s fees,

Plaintiffs must identify some circumstance that overcomes

that default rule. See Alyeska Pipeline Serv. Co. v. Wilderness

Soc’y, 421 U.S. 240, 247, 257–60 (1975). ERISA provides

for attorney’s fees in certain actions against private plan

administrators, see 29 U.S.C. § 1303(f)(3), but the statute

does not authorize attorney’s fees for actions against the

PBGC, such as this case. Plaintiffs cite 28 U.S.C. § 2412(b)

as an authorization for attorney’s fees. Section 2412(b)

allows fees against the Government “to the same extent that

any other party would be liable . . . under the terms of any

statute which specifically provides for such an award.” Here,

however, plaintiffs are suing under 29 U.S.C. § 1303(f), and

no party other than the Government can be liable under that

statute, because 1303(f) provides a cause of action only

against the PBGC. Section 2412(b) thus does not authorize

attorney’s fees in this case.

IV

We reverse the judgment of the District Court with

respect to Plaintiffs’ actuarial equivalence claim. The amount

of Plaintiffs’ lump sum benefit was equal to the actuarial

present value of the annuity payments Plaintiffs would have

received under the Plan’s default payment option. Even so,

9

U.S. Air’s 45-day delay in paying Plaintiffs was unrelated to

the calculation of Plaintiffs’ benefits, and therefore not

reasonable under existing IRS regulations. We therefore

remand to the district court to calculate the appropriate

amounts due Plaintiffs. In addition, we affirm the judgment

of the district court that Plaintiffs are not entitled to attorney’s

fees.

So ordered.

KAVANAUGH, Circuit Judge, concurring in the

judgment: 1

I concur only in the judgment. In my view, Stephens and

Mahoney should receive interest for the full 45 days that U.S.

Airways delayed payment of their lump sum pensions.

Under ERISA, if a pension plan allows retirees to select a

lump sum payment in lieu of an annuity, the lump sum

payment “shall be the actuarial equivalent” of the annuity. 29

U.S.C. § 1054(c)(3). That means that the lump sum must “be

worth at least as much as that annuity.” Esden v. Bank of

Boston, 229 F.3d 154, 163 (2d Cir. 2000). The lump sums

that plaintiffs received were worth less than the plan’s annuity

option. Therefore, those lump sum payments violated

ERISA.

There is no dispute that U.S. Airways accurately

calculated plaintiffs’ lump sums to be the “actuarial

equivalent” of the annuity option as of the annuity start date.

There is also no dispute that the plan paid those lump sum

amounts 45 days after the annuity start date. The question

before this Court is therefore simple: If a lump sum and an

annuity would be actuarially equivalent if the lump sum were

paid on the annuity start date, is the same lump sum amount

actuarially equivalent to the annuity when the lump sum is

actually paid 45 days later than the annuity start date?

In my view, the answer is also simple: No. Money later

is not the same as money now. Receiving $1000 45 days

from now is not equivalent to receiving $1000 now, because

(among other things) that $1000 can earn interest every day

one has it. It is true that the concept of actuarial equivalence

1

Judge Brown’s opinion is the controlling opinion in this case

because it presents the narrowest grounds of the opinions forming a

majority. See Marks v. United States, 430 U.S. 188, 193 (1977).

2

can be difficult to apply in some cases – for example, when

comparing the value of health insurance plans that offer

different menus of benefits. But the concept is easy to apply

here. Money has time value. And because the lump sum

payments had the same value as the annuity on the annuity

start date, the lump sums U.S. Airways paid 45 days later

were worth less than the annuity. U.S. Airways’ pension plan

thus violated ERISA’s requirement that lump sum payments

“be the actuarial equivalent” of the plan’s annuity option. 29

U.S.C. § 1054(c)(3); see also Berger v. Xerox Corp.

Retirement Income Guarantee Plan, 338 F.3d 755, 759 (7th

Cir. 2003) (Posner, J.) (“The basic tradeoff involved in

determining actuarial equivalence between a lump sum and an

accrued pension benefit is between a present and a future

value, and the method of equating them is the application of a

discount rate to the future value.”).

According to PBGC, so long as U.S. Airways accurately

calculated lump sums that were equivalent to the annuity on

the annuity start date, it does not matter that the delayed lump

sums plaintiffs actually received were less valuable than the

theoretical, timely lump sums. But ERISA’s actuarial

equivalence requirement serves to protect actual retirees, not

merely to ensure that pension plans correctly perform abstract

calculations. Therefore, “ERISA requires actuarial

equivalence between the actual distribution and the accrued

benefit it replaces.” Miller v. Xerox Corp. Retirement Income

Guarantee Plan, 464 F.3d 871, 874 (9th Cir. 2006) (emphasis

added). A pension plan could not satisfy ERISA by correctly

calculating an actuarially equivalent lump sum, then paying

only half that sum to a retiree. Similarly, a pension plan

cannot satisfy ERISA by correctly calculating an actuarially

equivalent lump sum, then delaying payment of that sum until

a date when the sum has become less valuable.

3

U.S. Airways – and now PBGC, as U.S. Airways’

successor – owes plaintiffs the difference in value between

the lump sums plaintiffs received and the value of those sums

45 days earlier on the annuity start date. That difference in

value is, of course, the interest on plaintiffs’ lump sum

pensions for the 45 days that the pension plan delayed

payment of those pensions. See Contilli v. Local 705 Int’l

Brotherhood of Teamsters Pension Fund, 559 F.3d 720, 722

(7th Cir. 2009) (Easterbrook, C.J.) (“payments skipped as a

result of the deferral must be made up, either by payment

(with interest) once the deferral ends, or by a suitable

actuarial adjustment to the ongoing benefits”); see generally

Esden, 229 F.3d at 163-65.

To be sure, ERISA tolerates reasonable delays for a plan

to calculate and make a lump sum payment. But any delayed

payment must be made “with interest” in order to ensure that

“the value of the pension is [not] lower than one that begins

on the normal retirement date.” Contilli, 559 F.3d at 722.

ERISA’s actuarial equivalence requirement contains no

exception permitting a plan to withhold interest payments for

administrative delays. See 29 U.S.C. § 1054(c)(3). Put

another way, ERISA permits pension plans to reasonably

delay lump sum payments, but it requires that delayed lump

sum payments remain actuarially equivalent to annuity

payments. Here, that means these plaintiffs were entitled to

interest for the 45 days that U.S. Airways delayed payment of

their lump sum pensions – regardless of whether U.S.

Airways’ delay in making the actual payments was

reasonable.

In ignoring the effect of the delay on the value of the

lump sum payments that plaintiffs received, PBGC cites an

IRS regulation establishing that reasonable administrative

delays in a pension’s annuity payments do not affect

4

survivorship benefits claims. See 26 C.F.R. § 1.401(a)-20,

Q&A-10(b)(3). But that IRS regulation says nothing about

whether interest is due on delayed payments, and likewise

says nothing about ERISA’s requirement that lump sums

(delayed or otherwise) be actuarially equivalent to annuities.

PBGC also relies on a statement by plaintiffs’ expert that

pension plans “in practice” often deem delays of 30 days or

less “reasonable” and do not pay interest. J.A. 430-31.

Plaintiffs’ expert did not say that late payments are actuarially

equivalent, only that “in practice” some pension plans pretend

that late payments are actuarially equivalent. Regardless of

whether some pension plans ignore ERISA’s requirements at

the margins, the law is clear, and we should enforce it as

written in this case. 2

2

I agree with the controlling opinion in affirming the District

Court’s denial of plaintiffs’ request for attorney’s fees.

KAREN LE CRAFT HENDERSON, Circuit Judge, dissenting in part:

While we all agree that the Employee Retirement Income

Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001 et seq., does

not allow the plaintiffs to recover attorneys’ fees in their suit

against the Pension Benefit Guaranty Corporation (PBGC),

see Opinion of Judge Brown (Brown Op.) at 8; Opinion of Judge

Kavanaugh (Kavanuagh Op.) at 4 n.1, I also believe that they are

not entitled to recoup forty-five days’ interest for the delayed

payment of their lump sum benefits. Accordingly, I dissent in

part.

The actuarial equivalence requirement set forth in 29 U.S.C.

§ 1054(c)(3) is “clear,” Kavanaugh Op. at 4, and requires a lump

sum payment to be “ ‘worth at least as much as’ ” an annuity

commencing at the normal retirement age, Brown Op. at 4–5

(quoting Esden v. Bank of Boston, 229 F.3d 154, 163 (2d Cir.

2000), cert. dismissed, 531 U.S. 1061 (2001))—which annuity,

under the U.S. Airways plan, becomes due on the “Benefit

Commencement Date,” the first day of the month following the

pilot’s sixtieth birthday. Moreover, Judge Brown and I agree

that as long as the lump sum benefit is equivalent to the present

value of a pilot’s retirement benefit calculated as of his Benefit

Commencement Date, payment may be “reasonably delayed”

without running afoul of the actuarial equivalence rule. Brown

Op. at 5–6. Any other interpretation could impose a daunting

administrative burden on a pension plan administrator, requiring

interest to be paid or benefits to be recalculated for even the

slightest delay in payment—including, for instance, the time it

takes for a pension check to travel through the mail. As Judge

Brown notes, the Internal Revenue Service (IRS)—“one of the

agencies charged with administering ERISA,” Rose v. Long

Island R.R. Pension Plan, 828 F.2d 910, 918 (2d Cir. 1987),

cert. denied, 485 U.S. 936 (1988)—sensibly avoids this

burdensome result by creating an exemption for a reasonable

delay in payment. Brown Op. at 6; see 26 C.F.R. § 1.401(a)-20,

Q&A-10(b)(3). The IRS regulation states: “A payment shall not

be considered to occur after the annuity starting date merely

2

because actual payment is reasonably delayed for calculation of

the benefit amount if all payments are actually made.” 26 C.F.R.

§ 1.401(a)-20, Q&A-10(b)(3) (emphasis added). Put another

way, we must “consider[]” the lump sum payments here to have

“occur[red]” on each plaintiff’s respective Benefit

Commencement Date so long as payment was only “reasonably”

delayed.1

I have no doubt that payment was “reasonably”

delayed—and here I part ways with Judge Brown. According to

Judge Brown, it was reasonable for U.S. Airways to delay

payment while its pension plan administrator calculated benefits,

reviewed these calculations, checked for qualified domestic

relations orders, cut the check and then sent it to the pilot.

Brown Op. at 6–7. These tasks required fifteen to twenty-one

business days to complete—corresponding to roughly three to

four calendar weeks. Judge Brown, however, omits one

important detail. In order to begin calculations in the first

place—and set the three- to four-week process in motion—the

pension plan administrator has to know the pilot’s “Final

Average Earnings,” a number derived in part from the pilot’s

earnings during his final month before retirement. Unlike a

salaried employee, a pilot working for US Airways earns an

hourly wage. His pay can fluctuate considerably from one month

to the next based on the number of hours logged and

differentials for night pay, “overwater pay” and other

adjustments. Weidenmuller Dep. at 65–66 (Joint Appendix (JA)

1

Although the regulation on its face applies only to a joint and

survivor annuity, I nevertheless believe it should guide our analysis

because there is no practical difference from a pension plan

administrator’s point of view between paying a joint and survivor

annuity and paying a lump sum benefit. I note that the regulation is

“written in question and answer form” but “[t]his novel format does

not alter [its] weight as regulation[].” Hurwitz v. Sher, 982 F.2d 778,

782 n.4 (2d Cir. 1992), cert. denied, 508 U.S. 912 (1993).

3

185–86). Because of the month-to-month variance, the pilot’s

final-month earnings are not calculated and finalized until the

eighteenth day of the month following his retirement.2 Taking

into account the eighteen-day delay at the front end, I calculate

the entire sequence—from computing a pilot’s final-month

salary to payment of his lump sum benefit—required roughly

forty to forty-five days.

Judge Brown maintains that we should not take into account

the eighteen-day period for computing a pilot’s final-month

earnings because the pension plan administrator knows the

pilot’s retirement date in advance and “can plan accordingly.”

Brown Op. at 7 n.1. The unknown quantity, however, is not the

date of the pilot’s retirement but the amount of his final-month

earnings—which, as noted above, varies from one month to the

next. Judge Brown also seems to doubt whether eighteen days

is really necessary to calculate the pilot’s final-month earnings.

See id. (eighteen-day delay “says nothing of how long it took the

Plan to calculate [final-month] earnings”). The burden of proof,

however, does not rest on US Airways (or its successor, the

PBGC) to establish the reasonableness of the forty-five day

delay in paying the plaintiffs’ lump sum benefits. Rather, it is

the plaintiffs’ burden to establish the unreasonableness of the

delay—including both the eighteen-day period to compute final-

month earnings and the two- to three-week period to calculate

the lump sum benefit amount. Cf. Horton v. Reliance Standard

Life Ins. Co., 141 F.3d 1038, 1040 (11th Cir. 1998) (ERISA

plaintiff “bears the burden of proving his entitlement to

contractual benefits”). Because the plaintiffs have not carried

their burden, I would affirm the district court’s denial of interest.

2

For example, plaintiff Stephens retired on November 25, 1996.

His earnings for the month of November were calculated and he

received his final paycheck—reflecting his November earnings—on

December 18, 1996. Only then did the pension plan administrator have

the necessary information to calculate Stephens’s lump sum benefit.

4

My colleagues’ decision to remand may well open the

courthouse doors to litigation over de minimis amounts of

interest accrued during a few weeks or even days. The plaintiffs’

victory is hollow to say the least in light of our holding denying

attorney’s fees; they are left with a four-digit recovery and,

undoubtedly, five- or even six-digit legal costs. Moreover, Judge

Brown concedes that a delay of up to thirty days would be

reasonable. Brown Op. at 6–7. Because she and I agree that US

Airways acted reasonably at least up to the thirty-day mark, the

plaintiffs should recover—at most—fifteen days’ interest,

meaning they should receive no more than one-third of the

amount they are asking for. The difference is important given

the likelihood that on remand the plaintiffs will ask for

prejudgment interest going back roughly fifteen years

(Stephens) and twelve years (Mahoney). See Moore v.

CapitalCare, Inc., 461 F.3d 1, 12 (D.C. Cir. 2006) (prejudgment

interest “presumptively appropriate” for unpaid ERISA

benefits). Assuming the plaintiffs do so, the applicable interest

rate is within the district court’s discretion, see Berger v. Iron

Workers Reinforced Rodmen, Local 201, 170 F.3d 1111, 1139

(D.C. Cir. 1999). Given the significant decline in long-term

interest rates, however, I doubt that the rate of 6.25 per cent,

suggested by the plaintiffs’ expert, Poulin Decl. ¶ 8, would be a

proper rate to carry the interest forward to the judgment date.

See Pension Benefit Guar. Corp., Lump Sums,

http://www.pbgc.gov/prac/interest/vls.html (last visited June 1,

2011).

Finally, because the plaintiffs are entitled only to

“appropriate equitable relief” under ERISA, 29 U.S.C.

§ 1303(f)(1), it is worth noting that they have already received

more than many U.S. Airways annuitants will ever see. U.S.

Airways pilots who reached retirement age after April 1,

2000—a few years after plaintiff Stephens and just thirteen

months after plaintiff Mahoney—received nothing from the

distribution of plan assets and thus had their benefits capped at

5

the statutory maximum of $28,585.20 per year, see 29 U.S.C.

§ 1322(a)–(b); 29 C.F.R. pt. 4011, app. B; Press Release,

Pension Benefit Guar. Corp., PBGC Becomes Trustee of US

Airways Pension Plan for Pilots (Apr. 1, 2003)

[http://www.pbgc.gov/news/press/releases/pr03-32.html], in

some cases collecting less than 50 cents on the dollar. In re US

Airways Grp., Inc., 296 B.R. 734, 741 (Bankr. E.D. Va. 2003);

Nanette Byrnes & David Welch, The Benefits Trap, Bus. Wk.,

July 19, 2004; Kathleen Pender, What They’ll Get: How Pension

Agency Pays Out, S.F. Chron., May 12, 2005, at C1. It hardly

seems equitable to gild the plaintiffs’ lily, even minimally, when

they are already far better off than their hapless annuitant peers.

Accordingly, I respectfully dissent in part.