Opposition Brief — Mattei v. Mattei

: Supreme Court, 0.5.

Lo) FILED

-

No. 97-1523 APR 15 1998

>

IN THE CLERK

SUPREME COURT OF THE UNITED STATES

October Term, 1997

RONALD MATTEL Individually and as

Executor of the Estate of Louis J.

Mattei and

MARY LAURA MATTE! - - - - _ Petitioners,

versus

MARIA MATTEL - - - - - - Respondent.

On Petition for Writ of Certiorari to the

United States Court of Appeals for the Sixth Circuit

RESPONDENT’S BRIEF IN OPPOSITION TO

PETITION FOR WRIT OF CERTIORARI

*ROBERT W. GRIFFITH

JOHN A. BARTLETT

SUSAN CANTER REISNER

400 West Market Street, Suite 1800

Louisville, Kentucky 40202-3352

(502) 587-3400

Counsel for Respondent

*Counsel of Record

April 14, 1998

WESTERFIELD-SONTE CO., 619 W. KENTUCKY—P.O. BOX 3251, LOUISVILLE, KY.

ee een

i

QUESTION PRESENTED

May a surviving spouse who is the beneficiary (under

29 U.S.C. § 1055, § 205 of ERISA) of her husband’s death

benefits in an employee pension benefit plan maintain an

action against her husband’s estate pursuant to 29 U.S.C.

§ 1140 (§ 510 of ERISA) where the estate, an unsuccessful

rival claimant to the pension benefits, has discontinued a

weekly stipend payable to the surviving spouse under an

antenuptial agreement in retaliation for, or as an offset

against, the surviving spouse’s retention of the pension

benefits?

y

bad

.¢

i

LIST OF PARTIES

Parties before this Court

Ronald Mattei, Individually and as Executor of the Estate

of Louis J. Mattei, and Mary Laura Mattei, Petitioners

Maria Mattei, Respondent

Parties to the Proceeding Below

(United States Court of Appeals for the Sixth Circuit

No. 96-5443)

Maria Mattei, Appellant

Ronald Mattei, Individually and as Executor of the Estate

of Louis J. Mattei, and Mary Laura Mattei, Appellees

iii

TABLE OF CONTENTS

ee

QUESTION PRESENTED ....................................

en

STATUTES OR OTHER PROVISIONS

. ., » SO aa

A. The Estate’s Claims Against Equifax ........

B. The Estate’s Requests for Maria to

Surrender Her Rights to the Plan Benefits

REASONS FOR DENYING THE PETITION ...

B. The Sixth Circuit Merely Explained and

Question Presented Sufficient to Require

Resolution in this Court. ............................

C. The Sixth Circuit's Ruling Does Not

Expand ERISA Pre-Emption and Does Not

Federalize Trust and Estate Law Beyond

What 29 U.S.C. §1055 (ERISA §205)

Clearly Requires for Protection of Surviv-

ing Spouses Such as Maria Mattei...

Se oe STRESS

iv

TABLE OF AUTHORITIES

PAGE

Cases:

Boggs v. Boggs, __ U.S. ___, 117 S. Ct. 1754,

1760-61, 1767, 138 L.Ed.2d 45 (1997)........... 11-13, 15

Callahan v. Hutsell, Callahan & Buchino, P.S.C.

Revised Profit Sharing Plan, 813 F. Supp. 541

(W.D. Ky. 1992), vacated on other grounds,

14 F.3d GOO (Gtk Cir. TGS)... ccccccccescicccccossscseeses 14

Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 15,

107 S. Ct. 2211, 2219, 96 L.Ed.2d 1 (1987)........ 13

Haberern v. Kaupp Vascular Surgeons Ltd.

Defined Benefit Pension Plan, 24 F.2d 1491

(3d Cir. 1994), cert. denied, U.S.__,

115 S. Ct. 1099, 180 L.Ed.2d 1067 (1995).......... 10

Hamilton-Brown Shoe Co. v. Wolf Brothers & Co.,

240 U.S. 251, 258, 36 S. Ct. 269, 60 L. Ed. 629,

Be Cr icici edekndicbes ietakicinad daa ctercadanaknebiekes 8

Hurwitz v. Sher, 982 F.2d 778, 781 (2d Cir. 1992);

cert. denied, 508 U.S. 912, 113 S. Ct. 2345,

EG Fc Ree Be FE ceases naendinnbaticesains 14

Ingersoll-Rand v. McClendon, 498 U.S. 133, 143,

111 S. Ct. 478, 485, 112 L.Ed.2d 474 (1990)...... 8

Inter-Modal Rail Employees Ass'n. v. Atchison,

Topeka & Santa Fe Ry. Co., 80 F.3d 348,

351 (9th Cir. 1996, rev'd on Ogden grounds,

__ US. _, 1178.Ct. 1513, 187 L.Ed. 2d 763

TT re al adaie 3n.1

Lasche v. George W. Lasche Basic Profit Sharing

Plan, 111 F.2d 863 (11th Cir. 1997)................... 14

Massachusetts Mutual Life Ins. Co. v. Russell, 473

U.S. 134, 105 S. Ct. 3085, 87 L.Ed.2d 96 (1985) 13

McCray v. New York, 461 U.S. 961, 963, 103 S. Ct.

2438, 2439, 77 L.Ed.2d 13822 (1983)................... 11

McGath v. Auto-Body North Shore, Inc., 7 F.3d

re ETRE is TI eich Gochiictanccedssceschtidisssacanbalinnsne 10

McMillan v. Parrott, 913 F.2d 310 (6th Cir. 1990) 14

Metropolitan Life Insurance Co. v. Pressley, 82

RPM Ree TUIAU Gott BRMIIED vac covcsarntncsatnccbscrancasinss 14

Moore v. Philip Morris Companies, Inc., 8 F.3d

oe, ES Ce Gr, TD a cesncicscccescccnceassnveneoss 14

a

El

Vv

PAGE

Cases: (Continued)

Nellis v. Boeing Co., 15 Employee Benefits Cases

(een? 80s CO. Bee. MO 14

Pedro Enterprises, Inc. v. Perdue, 998 F.2d 491,

Oe CNS, PE iid 14

Rogers v. Jefferson-Pilot Life Insurance Co., 883

Fiano (0th Cir. 1960). 10

Virginia Military Institute v. United States, 508

U.S. 946, 113 S. Ct. 2431, 124 L. Ed.2d 651

A PORE eiopdatnaeinidilih cai Rigid aia a cae ne Ns 8

West v. Butler, 621 F.2d 240, 245-246 (6th Cir.

i BRO CORT HEN ap Mea Dianne os RETA ET: 8-10

Woolsey v. Marion Laboratories, Inc., 934 F.2d

RE I Cl SE scion ae 10

Zinn v. Donaldson Co., Inc., 799 F. Supp. 69

Sire ONS AWTIEE Scns ciipacdccetnienic a 14

Statutes:

Internal Revenue Code of 1986, as amended

(“Code”): 26 U.S.C::

WN cinta ea eat a 2

PIN Fen iissouniinisiasadaseuiheniacl cee 2,4

Employee Retirement Income Security Act of

1974, as amended (“ERISA”):

29 U.S.C.:

> Pe ee Oe 2

S RO CRIA, © DOG) ise cisencesccsecs cases, 1, 4-5, 13-14

§ 1132(a)(1)(B) (ERISA § 502(a)(1)(B)) oe... a Ad

§ 1132(a)(3) (ERISA § 502(a)(3) ooecceccccccecceccceeee 2

© 5 Ree rn 5

S 1240 CRIA 8 GID) oon cvicccococnseace ss. 1, 3, 8-12, 15

§ 1144(a) (ERISA $ 514(a) ..........c.ccceceosce---..-. 2

Regulations and Court Rules:

Treasury Regulations:

26 C.F.R. § 1.401(a)-20, Q&A 28 o... oe ecccccccceceee 2

Federal Rules of Civil Procedure:

ih, Wie Se By Ro 34

Rules of the United States Supreme Court:

SMMOU BA Mcikcs pisicceieecat an, ee 2

No. 97-1523

IN THE

SUPREME COURT OF THE UNITED STATES

October Term, 1997

RONALD MATTE, Individually and as

Executor of the Estate of Louis J.

Mattei and

MARE DMIIMRMUAT TE, (<0 ee eee Petitioners,

versus

RAAEAAN BOE Ry 8 ie ew Respondent.

ON PETITION FOR Writ oF CERTIORARI TO THE

UNniTED States Court or APPEALS FOR THE SIXTH CIRCUIT

RESPONDENT’S BRIEF IN OPPOSITION TO

PETITION FOR WRIT OF CERTIORARI

OPINIONS BELOW

See Petition at p. 1.

JURISDICTION

See Petition at pp. 1-2.

STATUTES OR OTHER PROVISIONS INVOLVED

In addition to § 510 of the Employee Retirement In-

come Security Act of 1974, as amended (“ERISA”), 29 U.S.C.

§ 1140, cited by Petitioner, this case involves the scope

and proper application of the following statutes and regu-

lations, the pertinent text of which is set forth in Appendix

A hereto:

(1) 29U.S.C. § 1055 (ERISA § 205);

2

(2) § 401(a)\(11), Internal Revenue Code of 1986, as

amended (“Code”);

(3) § 417 of the Code;

(4) Treasury Regulations § 1.401(a)-20, Q&A 28 (26

C.F.R. § 1.401(a)-20, Q&A 28);

(5) 29 U.S.C. § 1132(a)(1)(B) and (a)(3) (§§ 502(a)(1)(B)

and (a)(3) of ERISA); and

(6) 29 U.S.C. § 1144(a) (§ 514(a) of ERISA).

STATEMENT OF THE CASE

Pursuant to Rule 15.2 of this Court, the Respondent,

Maria Mattei, must point out a number of misstatements

in, and omissions from, Petitioner’s Statement of the Case

(Petition at 2-5).

First, as to the law, this dispute is not just a “family

law estate dispute” (Petition at 3) — ERISA-protected pen-

sion benefits were, and are, at the heart of it. The contro-

versy centers upon, and grows out of, the response by the

Estate of Louis J. Mattei, Sr. (“Estate”) to the distribution

by Equifax, Inc. ("Equifax"), of the death benefits of Louis

J. Mattei, Sr. (“Mr. Mattei”) to his surviving spouse, Maria

Mattei, under the Equifax, Inc. Thrift Plan ("Thrift Plan").

The Thrift Plan is an employee pension benefit plan de-

scribed in ERISA § 3(2), 29 U.S.C. § 1002(2).

The Estate’s response to Maria’s receipt of the Thrift

Plan benefits was to stop paying Maria Mattei the $300

per week, indexed annually at 6% (the "Stipend"), Mr.

Mattei had promised that his Estate would pay to Maria

after his death for her life or until she remarried. This

promise was set forth in Mr. Mattei's December 7, 1990

pre-marriage contract (the "Antenuptial Agreement") with

Maria. Petitioners acknowledge this Antenuptial Agree-

ment promise and the Estate’s stoppage of payments (Peti-

tion at 3) but stop short of saying why the Estate stopped

paying Maria the Stipend. Maria alleges, and the courts

Ee neal

3

below assumed for purposes of Petitioners’ Fed.R.Civ.P.

12(b) (6) motion to dismiss, that the Estate stopped the

payments in retaliation for Maria’s receipt and retention

of the ERISA pension benefits.

Second, Petitioners set out “material facts” (Petition at

2-5) outside the limitations inherent in the district court’s

dismissal of the complaint under Fed.R.Civ.P. 12(b\6). The

Sixth Circuit’s reversal of the district court and reinstate-

ment of the complaint places the case before this Court in

the stance of an interlocutory appeal prior to any discov-

ery. The only "facts" are in the complaint, and the central

limitation of the Fed.R.Civ.P. 12(b\6) dismissal in the dis-

trict court is that the allegations of the complaint are re-

quired to be taken as true. Since certain of Petitioners’

stated “material facts” evade this precept, a copy of the

complaint is attached for the convenience of the Court as

Appendix B, and a copy of the Antenuptial Agreement,

which was not filed with the complaint, is attached for the

Court’s convenience as Appendix C.

Maria clearly alleges in the complaint that the Estate's

motive for stopping the Stipend was retaliation for her

retention of the Thrift Plan benefits. (Complaint, Appen-

dix B, 77 12, 14-15, 19, 21). Petitioners, stating that Maria

"had already received the entire death benefit" and "that

the weekly payments were ceased almost two years after

she received that benefit," suggest the two events were

distant in time and unconnected. (Petition at 3-4).

1 The situation presented by Petitioners’ “material facts” presen-

tation is captured neatly in another ERISA § 510 case, Inter-

Modal Rail Employees Ass’n. v. Atchison, Topeka & Santa Fe Ry.

Co., 80 F.3d 348, 351 (9th Cir. 1996), rev’d on other grounds, __

U.S.__, 117S. Ct. 1513, 187 L.Ed.2d 763 (1997) as follows:

Defendants countered that an incidental or consequential

loss of future, unaccrued pension benefits is not actionable,

but, as plaintiffs correctly note, questions of motivation and

intent are not to be resolved at the pleading stage. [Empha-

sis added.]

4

Petitioners suggest to this Court that the facts, and the

motivations and intentions of the parties, are, or ultimately

would be shown to be, other than as the district court was

required to assume from the complaint under Fed.R. Civ.P.

12(b)(6). An example is Petitioners’ wildly inaccurate as-

sertion that “[n]o provision was made for Maria to receive

any benefits under the [Thrift] Plan.” (Petition at 3). In

light of the surviving spouse protections under 29 U.S.C. §

1055 (ERISA § 205) that must be a part of every employee

pension benefit plan, no separate “provision” needed to be

made. Worse, Petitioners incorrectly state that “Maria

does not allege that the Executor [of the Estate] ever asked

her to surrender her rights to the Plan benefits” (Petition

at 4), although such an act need not be shown where Maria

generally has alleged the Estate’s retaliation for her accep-

tance of ERISA benefits.

Whether or not such an allegation appears in the com-

plaint, Maria will be able to demonstrate, through admis-

sible documentary evidence in the district court, that the

Estate did ask her “to surrender her rights to the Plan

benefits.” These documents will show the long and strenu-

ous efforts of the Estate, both before and during that pe-

riod of “almost two years,” to obtain the Thrift Plan death

benefits, first from Equifax and then from Maria.

A. The Estate’s Claims Against Equifax

Beginning in early 1992, the Estate submitted to

Equifax a written claim that the Estate was Mr. Mattei’s

proper beneficiary under the Thrift Plan. (Letter, Estate

by Counsel to Equifax, 2/17/92, Appendix D hereto). Equifax

denied this claim, citing, inter alia, the surviving spouse

benefit provisions of 29 U.S.C. §1055 (ERISA §205) and

§417 of the Code. (Letter, Equifax to Estate’s Counsel, 3/6/

92, Appendix E hereto). Rebuffed but undeterred, the Es-

tate again wrote Equifax in August 1992, after the Thrift

Plan’s 60-day period for an administrative appeal had ex-

5

pired, demanding an accounting of Mr. Mattei’s pension

benefits and threatening to sue Equifax if the Estate’s de-

mand was not met. (Letter, Estate by Counsel to Equifax,

8/5/92, Appendix F hereto). The Plan reiterated the rea-

sons for the claim denial under 29 U.S.C. §1055 and added

a discussion of the Estate’s failure to exhaust administra-

tive remedies under 29 U.S.C. §1133 (ERISA §503). (Let-

ter, Equifax to Estate’s Counsel, 8/19/92, Appendix G

hereto).

The Estate then turned to Kentucky’s courts, and in

January 1993 filed an action in Jefferson Circuit Court

against Equifax seeking certain accrued but unpaid salary

and vacation pay of Mr. Mattei, but also demanding an

accounting of Mr. Mattei’s benefits in the Equifax Thrift

Plan. (Civil Summons and Complaint, Estate of Louis J.

Mattei, Sr. v. Equifax, Inc., Commonwealth of Kentucky,

Jefferson Circuit Court, No. 93-CI-147, Appendix H hereto).

In April 1993, the Estate and Equifax settled that lawsuit

as to the salary and vacation pay, but the Estate’s release

of claims “specifically exclud[ed] any claim which could

have been asserted against Equifax under the Plan.” (Re-

lease and Settlement Agreement, Estate and Equifax, 4/

28/93, Appendix I hereto). The Estate has never renounced

or relinquished its claim of entitlement to Mr. Mattei’s

Thrift Plan benefits.

B. The Estate’s Requests for Maria to Surrender

Her Rights to the Plan Benefits

The Estate’s efforts to get Maria to turn the Thrift

Plan benefits over to the Estate can be shown to have been

just as long-standing and persistent. During 1992, there

were handwritten notes from Ronald Mattei, the Estate’s

executor, to Maria, inquiring whether Maria had “signed

the papers that Equifax needed to forward the Thrift Plan

to the Estate....". (Note, Ron Mattei to “Marie” Mattei,

rec'd 8/19/92, Appendix J hereto). In February 1993, Maria

obtained the Thrift Plan benefits of Mr. Mattei. The Es-

6

tate continued to demand the Thrift Plan assets, remon-

strating with Equifax on the matter as late as October

1993. Having received Equifax’s December 1993 confirma-

tion that Mr. Mattei’s Thrift Plan benefits had been dis-

tributed to Maria (Letter, Equifax Counsel to Estate’s

Counsel, 12/8/93, Appendix K hereto), in March 1994 the

Estate’s counsel wrote Maria Mattei’s counsel requesting

“that she immediately turn the assets she received from

the Thrift Plan over to the Estate.” (Letter, Estate’s Coun-

sel to Maria’s Counsel, 3/21/94, Appendix L hereto). The

stated basis for this demand was the Estate’s claim that

Mr. Mattei, Maria Mattei and the Mattei children met in

March 1991 so that Mr. Mattei “could explain . . . that

the Thrift Plan was to be the source of periodic payments

under the Antenuptial Contract.” (Jd.)

The recollection of this meeting by the Mattei children

(who are generally the beneficiaries of the Estate) is dis-

puted by Maria Mattei and in any event is irrelevant. The

Antenuptial Agreement did not provide for any periodic

payments to be made from the Thrift Plan. (Appendix C).

In fact, the Antenuptial Agreement unambiguously pro-

vides that the Estate shall pay the Stipend. (/Jd.) Nor did

Maria Mattei consent during her marriage to Mr. Mattei

to any arrangement whereby the Thrift Plan benefits would

be paid to the Estate or used in any way by the Estate. As

the Equifax benefits administrator pointed out in denying

the Estate’s claim to Mr. Mattei’s Thrift Plan benefits, the

Antenuptial Agreement “does not mention the Plan in any

way, directly or indirectly, and the Contract does not indi-

cate Maria Mattei’s consent to the designation of another

beneficiary.” (Appendix E).

The Estate waited a few months more for Maria to

comply with its demand to turn over the Thrift Plan ben-

efits to the Estate. In December 1994, however, “the Es-

tate ceased making weekly disbursements to Maria under

the antenuptial agreement.” (Petition at 6).

7

In 1995, Maria obtained her present legal counsel, who

on September 15, 1995 wrote to counsel for the Estate

(also changed) requesting that the weekly payments from

the Estate to Maria under the Antenuptial Agreement be

caught up and resumed. (Letter, Maria’s Counsel to Estate’s

Counsel, 9/15/95, Appendix M hereto). Counsel for the

Estate responded in a September 25, 1995 letter asserting

that by receiving the Thrift Plan benefits, “Mrs. Mattei

has been overpaid by hundreds of thousands of dollars,”

and describing the $300 per week payments Maria did

receive until December 1994 as “resulting in a large over-

payment against the promise of $300 per week total.” (Let-

ter, Estate's Counsel to Maria’s Counsel, 9/25/95, Appendix

N hereto). The March 1991 meeting and Mr. Mattei’s

alleged “intentions” for the Thrift Plan were revisited. The

absence of any reference to these intentions in the Anten-

uptial Agreement was explained by an assertion that the

“agreement was not well-prepared.” (Jd.) Any pursuit by

Maria of resumption of the weekly payments under the

Antenuptial Agreement would be met, the letter contin-

ued, “with resistance as far as such resistance can be car-

ried through the legal system.” (Id.)

On November 22, 1995, Maria Mattei filed the Com-

plaint in the United States District Court for the Western

District of Kentucky. (Appendix B). The United States

Court of Appeals for the Sixth Circuit having reversed the

District Court’s dismissal of the Complaint, the Estate’s

resistance now reaches the docket of this Court.

REASONS FOR DENYING THE PETITION

A. This Is an Interlocutory Matter Better Con-

sidered by the Court When, and If, a Decision on

the Merits Is Had Below.

The opinion of the United States Court of Appeals for

the Sixth Circuit simply reinstates Maria Mattei’s “ERISA

claims and pendent state claims” in the district court.

(Opinion, 126 F.3d at 810; Petition at 32a). No answer to

8

Maria’s complaint has yet been filed, no discovery had, no

facts of record adduced. While the above recitation sug-

gests what the proof of facts may be, there is nothing “ex-

traordinary” in this case that should induce the Court to

depart from its usual course that “the writ [of certiorari] is

not issued until final decree.” Hamilton-Brown Shoe Co. v.

Wolf Brothers & Co., 240 U.S. 251, 258, 36 S. Ct. 269, 60 L.

Ed. 629, 633 (1916). Any of the parties may raise “the

same issues in a later petition, after final judgment has

been rendered.” Virginia Military Institute v. United States,

508 U.S. 946, 113 S. Ct. 2431, 124 L. Ed.2d 651 (1993).

B. The Sixth Circuit Merely Explained and Did Not

Overrule West v. Butler, 621 F.2d 240 (6th Cir.

1980), and There Is No Conflict Among the

Circuits on the Question Presented Sufficient to

Require Resolution in this Court.

Petitioners’ assertion that West “is implicitly overruled

or extended beyond recognition in the instant case” (Peti-

tion at 5) is simply wrong. Petitioners very selectively cite

from the Sixth Circuit’s comprehensive discussion of West

and its progeny (126 F.3d at 798-804; Petition at 7a - 19a)

and ignore the vast substance of that discussion, which in

and of itself provides sufficient basis for the Court to deny

the Petition.

Petitioners ignore the full impact of the key phrase in

West itself — “The legislative history [of 29 U.S.C. § 1140]

reveals that the prohibitions were aimed primarily at pre-

venting unscrupulous employers from discharging or ha-

rassing their employees in order to keep them from

obtaining vested pension rights.” 621 F.2d at 245 (empha-

sis added); cited, 126 F.3d at 798. The Sixth Circuit’s

statement of the primary purpose of § 510 in West closely

resembles this Court’s statement in Ingersoll-Rand v.

McClendon, 498 U.S. 133, 143, 111 S. Ct. 478, 485, 112

L.Ed.2d 474 (1990) that a claim that an employer termi-

nated or otherwise discriminated against an employee “to

9

circumvent the provision of promised benefits ... is proto-

typical of the kind Congress intended to cover under §

510.” (Emphasis added.) As should be obvious, the “pri-

mary” purpose of ERISA § 510 is not the sole or exclusive

purpose. A “prototypical” § 510 claim is an original model

or form for such a claim, but the word itself assumes the

existence of variations from the “prototype.”

As the Sixth Circuit explains, the facts of West “are far

from ‘prototypical,’ ” making it “a bit odd that West is the

leading § 1140 case.” 126 F.3d at 798; Petition at 7a. The

West plaintiffs, trustees of a collectively-bargained pension

fund, alleged that secondary boycotters harmed the fund,

and thereby interfered with participants’ attainment of pen-

sion benefits under § 510, by causing the sponsoring coal

companies to curtail the coal production upon which con-

tributions to the plan were based. Sorting through this

Rube Goldberg-like theory of causation of harm to the par-

ticipants, the Sixth Circuit focused on the key flaw — plain-

tiffs’ attempt to use ERISA § 510 “to protect the financial

security of pension funds.” 621 F.2d at 246.

It is in this particular setting of fact and theory that

the Sixth Circuit uttered the oft-repeated phrase: “we con-

clude that discrimination, to violate § 510, must affect the

individual’s employment relationship in some substantial

way.” Id. at 245-246. That is, actions that discriminate by

changing or otherwise affecting the plan itself do not come

within the scope of § 510.

The Sixth Circuit carefully examines all the cases cited

by Petitioners (and some Petitioners did not cite) which re-

peat West’s “employment relationship” phrase, concluding:

[W]hen courts, quoting West, state that “discrimina-

tion, to violate § 510, must affect the individual’s em-

ployment relationship in some significant way,” they

generally do so in order to make the point that, by

contrast, § 510 offers no protection against an

employer's actions affecting the scope and status of an

ERISA plan itself.

10

126 F.3d at 800; Petition at lla.

In the cases upon which Petitioners rely to show a

conflict among federal circuits, that is precisely the way in

which those courts citing West use the Sixth Circuit's treat-

ment of § 510. Haberern v. Kaupp Vascular Surgeons Ltd.

Defined Benefit Pension Plan, 24 F.3d 1491 (3d Cir. 1994),

cert. denied, _ U.S. __, 115 S. Ct. 1099, 130 L.Ed.2d

1067 (1995) and McGath v. Auto-Body North Shore, Inc., 7

F.3d 665 (7th Cir. 1993) are cases in which the discrimina-

tion complained of consisted of the employer’s amendment

of a pension plan so as to prevent the plaintiffs participa-

tion (McGath) or to reduce compensation upon which fu-

ture benefit accruals were to be based (Haberern). In

Woolsey v. Marion Laboratories, Inc., 934 F.2d 1452 (10th

Cir. 1991), the alleged “discrimination” was a profit shar-

ing plan administrator’s denial of a participant’s request

to receive one-half of his benefits in employer stock. In

Rogers v. Jefferson-Pilot Life Insurance Co., 883 F.2d 324

(4th Cir. 1989), which does not cite West, the fact focus is a

group health policy administrator’s denial of health ben-

efits, and the court simply holds that such a plan benefit-

related action should have been grounded in 29 U.S.C. §

1132(a)(1)B) rather than 29 U.S.C. § 1140. Thus, the

“conflict among the Third, Fourth, Seventh, and Tenth Cir-

cuits” (and not the Sixth?) posited by Petitioners (Petition

at 6) simply collapses into a collection of divergent dicta.”

2 Not presuming to speak for the other courts, the Sixth Circuit

adds:

Possibly the courts intended this language [that the protec-

tions of ERISA § 510 are limited to employment situations

that affect ERISA rights] to be categorical, rather than sim-

ply, as we have suggested above, part of an argument that

actions taken with respect to the plan itself are not pro-

tected by § 510. If they did, we disagree. The conclusion

that § 1140 covers only conduct affecting “the employment

relationship” is insupportable. [Emphasis added.]

126 F.3d at 801; Petition at 13a-14a.

rr ——!

1]

What surely defeats Petitioners’ claim of a conflict is

that the cases in the other circuits are distinguishable on

their facts from this case as it now stands, nearly all of

them involving allegations that an employer’s actions ei-

ther in amending an ERISA plan or in denying certain

plan benefits violated § 510. The facts, as noted, have yet

to be developed in this case. Petitioners have not cited a

decision of another circuit with even remotely analogous

facts. Plainly, this case is more logically to be regarded as

among the first of its kind, making equally clear that the

issues arising from its facts should undergo “further study”

in lower courts “before it is addressed by this Court.”

McCray v. New York, 461 U.S. 961, 963, 103 S. Ct. 2438,

2439, 77 L.Ed.2d 1322 (1983).

C. The Sixth Circuit’s Ruling Does Not Expand

ERISA Pre-Emption and Does Not Federalize

Trust and Estate Law Beyond What 29 U.S.C.

§1055 (ERISA § 205) Clearly Requires for

Protection of Surviving Spouses Such as Maria

Mattei.

The Sixth Circuit correctly assesses that this decision

does not “exponentially expand federal jurisdiction over

state law claims” (Petition at 10):

The dissent complains that our interpretation of § 1140

federalizes family law. I do not believe that we do

any more than ERISA has already accomplished by

means of its broad preemption provision, 29 U.S.C. §

1144(a) . . .. [VJery recently, the Supreme Court

held, in Boggs v. Boggs, __ US. Bere ty ee ey, FT

138 L.Ed.2d 45 (1997), that community property laws

— a keystone of family law in the states having such

regimes — do not withstand ERISA preemption. The

Court went so far as to say that “[t]his case involves a

community property claim, but our ruling will affect

as well the right to make claims or assert interests

based on the law of any State, whether or not it recog-

nizes community property.” Id. at nut at Oe

neni

12

1760. By comparison, our holding adds little to the

pre-existing breadth of ERISA preemption.

126 F.3d at 809, Petition at 30a-31a.

The Sixth Circuit holds that wherever one may finally

locate “the intersection of ERISA pension law and state

family and probate law” (Petition at 9), “what the estate is

not free to do is to invoke self-help by interfering or retali-

ating against Maria for a valid exercise of her ERISA

rights.” 126 F.3d at 809; Petition at 3la. In this regard,

any undue “expansion” of federal jurisdiction is logically

checked by the necessity for Maria to show that the Estate’s

withholding of payments “has a logical linkage to her sta-

tus as an ERISA beneficiary” in order to survive a sum-

mary judgment motion by defendants. 126 F.3d at 809;

Petition at 30a.

Petitioners’ reliance on Boggs (Petition at 8-10) is as-

tonishing. Petitioners’ assertion that ERISA § 510 pro-

tection must stop at the edge of a state-law antenuptial

agreement, no matter how the agreement affects pension

rights, is tantamount to a request for this Court to over-

rule Boggs.

Petitioners’ argument is clearly antithetical to Boggs.

Petitioners’ argument would allow the Estate to usurp the

rights of the ERISA beneficiary, Maria Mattei, in the Thrift

Plan benefits by cutting off the Stipend under the Anten-

uptial Agreement to enforce the Estate’s unilateral deter-

mination, unsupported by any ERISA or state-law

document, that the Thrift Plan benefits were “intended” to

be used to fund the Stipend. Thus, Petitioners’ argument,

“if allowed to succeed, would depart from [the ERISA]

framework [of participant and beneficiary], upsetting the

delicate balance central to ERISA.” __-_~;U.S. at _, 1117S.

Ct. at 1767, cited in Petition at 9.

Petitioners emphasize that Maria “already had received

the entire death benefit” (Petition at 3) under the Thrift

13

Plan, in essence repeating the argument of the testator’s

children in Boggs that “Sandra’s community property obli-

gations, after she receives the survivor annuity payments,

‘fai[l] to implicate the regulatory concerns of ERISA.’ ” ead

U.S. at__, 117 S. Ct. at 1761 (citation omitted). To that,

this Court said: “We disagree.” Jd. With equal force

should the same be said to Petitioners’ outright invention

of an Antenuptial Agreement “obligation” for Maria to fund

the Stipend with her Thrift Plan benefits (see Appendix

C), and to Petitioners’ argument that the Estate’s self-

help, because it occurred after Maria received the Thrift

Plan benefits, “fails to implicate the regulatory concerns of

ERISA.” Fort Halifax Packing Co. v. Coyne, 482 U.S. I

15, 107 S. Ct. 2211, 2219, 96 L.Ed.2d 1 (1987).

Finally, Petitioners’ argument that Boggs, combined

with Mattei, would allow a claimant to recover double dam-

ages (Petition at 9-10) merits a summary rejection. Peti-

tioners fail to consider this Court’s decision in Massachusetts

Mutual Life Ins. Co. v. Russell, 473 U.S. 134, 105 S. Ct.

3085, 87 L.Ed.2d 96 ( 1985) that in claims to enforce ERISA

benefit rights, extracontractual compensatory or punitive

damages are not recoverable.

Beyond obliteration of Boggs, Petitioners’ attempt to

draw an inviolable line around state family law would, if

successful, overrule the considerable body of unanimous

federal jurisprudence regarding the “intersection” of the

ERISA § 205 surviving spouse protections (29 U.S.C. § 1055)

and state-law antenuptial agreements. Petitioners assert

that state law should control the question whether the

Antenuptial Agreement would permit the Estate to use

Maria Mattei’s Thrift Plan death benefits to fund the Sti-

pend to Maria. In essence, this is the same as saying state

law should determine whether under the Antenuptial

Agreement Maria waived, in advance of marriage, her spou-

sal rights as a beneficiary of the Thrift Plan.

14

Such an assertion directly contradicts the entire body

of federal law on the question. A waiver of spouse survivor

benefits in an employee pension benefit plan must meet

the requirements of § 205 of ERISA, 29 U.S.C. § 1055, and

cannot be accomplished prior to marriage in a state law

antenuptial agreement. See, e.g., Pedro Enterprises, Inc. v.

Perdue, 998 F.2d 491, 494 (7th Cir. 1993); Hurwitz v. Sher,

982 F.2d 778, 781 (2d Cir. 1992); cert. denied, 508 U.S.

912, 113 S. Ct. 2345, 124 L.Ed2d 255 (1993); Callahan v.

Hutsell, Callahan & Buchino, P.S.C. Revised Profit Shar-

ing Plan, 813 F. Supp. 541 (W.D. Ky. 1992), vacated on

other grounds, 14 F.3d 600 (6th Cir. 1993); Nellis v. Boeing

Co., 15 Employee Benefits Cases (EBC) 1651 (D. Kan. 1992);

Zinn v. Donaldson Co., Inc., 799 F. Supp. 69 (D. Minn.

1992).

Indeed, the ERISA § 205 surviving spouse benefit waiver

standards, which are exacting, see, e.g., Lasche v. George

W. Lasche Basic Profit Sharing Plan, 111 F.2d 863 (11th

Cir. 1997), would apply equally to any waiver of Maria

Mattei’s Thrift Plan spouse survivor benefits purporied to

have been made during marriage. McMillan v. Parrott,

913 F.2d 310 (6th Cir. 1990). Even beyond state-law con-

tracts relative to marriage, state statutes or regulations

affecting rights of surviving spouses in employee benefit

plans must give way to ERISA’s requirements. See, e.g.,

Metropolitan Life Insurance Co. v. Pressley, 82 F.3d 126

(6th Cir. 1996) (ERISA preempts Michigan statute that

would require judgments of divorce or separate mainte-

nance to determine rights of wife in life insurance pro-

ceeds of husband’s policies or contracts in which wife was

designated beneficiary); Moore v. Philip Morris Companies,

Inc., 8 F.3d 335, 341-42 (6th Cir. 1993) (Kentucky adultery

forfeiture statute preempted by ERISA as affecting spouse

survivor rights).

In sum, the federal courts have already plainly and

overwhelmingly rejected Petitioners’ view that state law,

15

and a state court action, provides Maria Mattei’s sole rem-

edy for the Estate’s self-help against her pension-related

Antenuptial Agreement rights. Preemption of these rem-

edies by ERISA is the necessary conclusion of the same

conflict analysis this Court performed in Boggs as to a

Louisiana body of law “implement{[ing] policies and values

lying within the traditional domain of the States”:

We can begin, and in this case end, the analysis [of

the question of ERISA preemption] by simply asking

if state law conflicts with the provisions of ERISA or

operates to frustrate its objects. We hold that there is

a conflict, which suffices to resolve the case.

—__US. at__, 117 S. Ct. at 1760-61.

The preemptive effect of ERISA’s surviving spouse pro-

tections with regard to antenuptial agreements such as

Maria’s is thus well within conventional ERISA jurispru-

dence. No new ground is being plowed. If anything is out

of the ordinary, it is the unusual form of self-help prac-

ticed by the Estate. The Sixth Circuit has carefully and

correctly determined that the Estate’s alleged unilateral

action to retaliate against Maria for receiving her Thrift

Plan surviving spouse benefits, and to interfere with her

enjoyment of these ERISA benefits, is actionable under §

510 of ERISA.

16

CONCLUSION

For the foregoing reasons, the Petition of the Estate for

a writ of certiorari should be denied.

Respectfully submitted,

*ROBERT W. GRIFFITH

JOHN A. BARTLETT

SUSAN CANTER REISNER

STITES & HARBISON

400 West Market Street

Suite 1800

Louisville, Kentucky 40202-3352

(502) 587-3400

Counsel for Respondent

*Counsel of Record

April 14, 1998

SELLER NOTRE LTE

17

CERTIFICATE OF SERVICE

I, Robert W. Griffith, a member of the bar of this Court,

hereby certify that on this 14th day of April, 1998, three

(3) copies of the Respondent’s Brief in Opposition to Peti-

tion for Writ of Certiorari were served by mail, first-class

postage prepaid, upon:

Walter L. Sales, Esq.

Thomas M. Williams, Esq.

Ogden, Newell & Welch

1700 Citizens Plaza

Louisville, Kentucky 40202

I further certify that all parties required to be served

have been served.

~

Win (QQazo

“ROBERT W. GRIFFITH

JOHN A. BARTLETT

SUSAN CANTER REISNER

STITES & HARBISON

400 West Market Street

Suite 1800

Louisville, Kentucky 40202-3352

(502) 587-3400

Counsel for Respondent

*Counsel of Record