Opposition Brief — Kannapapien v. Quaker Oats Co Co (No. 07-1386)

Supreme Court brief2008

Ask Donna

What actually matters in this document.

Text

No. 07-1886 4

gerice oF mie cen

IN THE

Supreme Court of the United States

GERI KANNAPIEN AND JANICE ROZHON,

Petitioners,

QUAKER OATS COMPANY AND PEPSICO,

Respondenis.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Seventh Circuit

RESPONDENTS QUAKER OATS COMPANY’S 4

AND PEPSICO’S BRIEF IN OPPOSITION a

CONSTANTINE L. TRELA, JR.*

PRISCILLA E. RYAN

ERIN E. KELLY

JULIE M. WEBER

SIDLEY AUSTIN LLP

One South Dearborn Street

Chicago, Illinois 60603

(312) 853-7000

Counsel for Respondents Quaker Oats Company

and PepsiCo

July 7, 2008 * Counsel of Record

EE as SRR OE RRR REEL ENT ~ SERN UR RR LUNE

WiLson-Eres Pravriva Co., nc. — (202) 780-0008 — Wastanaron, D.C. 20002

EO ee ae ee oe tk See oe

SM Ley Bis Tx.

QUESTION PRESENTED

Whether an estoppel claim can be established with

respect to an unambiguous ERISA pension plan

based upon an admittedly innocent oral misstate-

ment by ah employee who was neither an administra- 4

tor nor a fiduciary of the plan and who directed the -

claimants to consult the appropriate source for 4

information concerning the benefits to which they 4

would be entitled if they elected to accept early

retirement.

(i)

CORPORATE DISCLOSURE STATEMENT

Pursuant to Supreme Court Rule 29.6, PepsiCo,

Inc. is the parent corporation of Quaker Oats

Company. PepsiCo, Inc. has no parent corporation.

PepsiCo, Inc. owns 100% of the stock of Quaker Oats

Company. No publicly held company owns 10% or

more of the stock of PepsiCo, Inc.

TABLE OF CONTENTS

QUESTION PRESENTED ....................cccccssesseeees 1

CORPORATE DISCLOSURE STATEMENT ...... ll

TABLE OF AUTHORITIES .................cocssseseseseees iv

III. The Decision Of The Court Of Appeals........

REASONS FOR DENYING THE PETITION .....

I. THE QUESTION ON WHICH PETITION-

ERS SEEK REVIEW IS NOT PROPERLY

]

II. The District Court Proceedings .................... 5

PRESENTED IN THIS CASE ...................... f

A. Petitioners Failed To Establish Any

Element Of Their Estoppel Claims........... 8

B. Even Under Petitioners’ Characteriza-

tion Of The Standards In Other Circuits,

Their Claims Would Fail .......................... 9

IJ. THERE IS NO CONFLICT AMONG THE

CIRCUITS CONCERNING THE APPLI-

CATION OF ERISA ESTOPPEL TO THE

CLAIMS ASSERTED BY PETITIONERS... 12

EPP osc nielccncivicdecisntdad denicascpesuiebacneness 18

(iii)

TABLE OF AUTHORITIES

CASES Page

Aramony uv. United Way Replacement

Benefit Plan, 191 F.3d 140 (2d Cir.

EB IRE S SPEEA LEISURE POM EMO NEE NS Crean 10

Armistead v. Vernitron Corp., 944 F.2d a

SIF CR Ga OE) oo onsets ccngssssesassenienoes 15 4

Busby v. JRHBW Realty, Inc., 513 F.3d :

REG Fi BP) wicvvoscceseccpcccesncascecesecsee 15 <

Coker v. Trans World Airlines, Inc., 165 3

F.3d 579 (7th Cir. 1999)......................00:..- 8 4

Cotton v. Mass. Mut. Life Ins. Co., 402 F.3d a

L267 CIE Cee, BOD) vii niccacsicsccncdecceccacscesse 14 a

Crosby v. Rohm & Haas Co., 480 F.3d 423 a

ee, Re a enn ae 15 a

Curcio v. John Hancock Mut. Life Ins. Co., 4

33 F.3d 226 (Sd Cir. 1994) .............5cc..c0000-- 13

Devlin v. Transp. Commc'ns Intl Union, a

17S Fk ek A LS) oo ssn cncegncvescncsnvnsse 16 4

Egelhoff uv. Egelhoff ex rel. Breiner, 532 q

EF ee Be pais ns kc os hays cc div an ewconvees 6 3

Gillis v. Hoechst Celanese Corp., 4 F.3d

peg ee oS. = 5 a ae an oreo rn 13

Greany v. W. Farm Bureau Life Ins. Co.,

973 F.2d 812 (9th Cir. 1992)................. eee 14

Greifenberger v. Hartford Life Ins. Co., 131

F. App’x 756 (2d Cir. 2005)...............cccceceees 16

Gridley v. Cleveland Pneumatic Co., 924

F 2b Boe CGE CAE: BO) nin snns cscs aces cccesccesss 13

HealthSouth Rehab. Hosp. v. Am. Nat'l

Red Cross, 101 F.3d 1005 (4th Cir. 1996). 12

High v. E-Sys. Inc., 459 F.3d 573 (5th Cir.

SEERA LISP FRI IU pnt te Re elec tn 17

Kane v. Aetna Life Ins, 893 F.2d 1283 (11th

INL I hig d carga saccnca nob aaibaee aicnatpdealiideoks 14

TABLE OF AUTHORITIES -— continued

Page

Kurz v. Phila. Elec. Co., 96 F.3d 1544 (3d

PU tte oils ores oo ae eae eres eee ce 13

Law v. Ernst & Young, 956 F.2d 364 (1st

RoR RII add dai cokre <ossuaad ss! ssatuuhmnbaciounienans 11

Livick v. The Gillette Co., 524 F.3d 24 (1st

SR cana achios vacua sce sous dsennneadcnasconasianct 16

Mauser v. Raytheon Co. Pension Plan for

Salaried Employees, 239 F.3d 51 (1st Cir.

ME ils i ade acs on ic Sin wget ep nipakiivens 16

Pisciotta v. Teledyne Indus., Inc., 91 F.3d

TR CO ae FO) ian onc sees scceseseccescies cen 14

Schonholz v. Long Island Jewish Med. Ctr.,

OT Foe Fae Gee it, 1996) 5 oo... ccs ssc... 16

Spink v. Lockheed Corp., 125 F.3d 1257

CON els SIE Sickie po cists. ccapenvavsdavagereinieetcarens 14

Trs. of Mich. Laborers’ Health Care Fund

v. Gibbons, 209 F.3d 587 (6th Cir. 2000)... 15

Vallone v. CNA Fin. Corp., 375 F.3d 623

RO ON CNN hires tics Sensacsicsacyusernsioudienses 8

STATUTES

Bee Cee, REP hg AO DOD: oi cescnccccncnccsccroncecasies 1

ae 5

RR ENCUIIED cc ccccvcccesscccsesersscvesese 6

Bee. ¥ Ee alt od a Bipi.

P hot ‘ :

A 4 ve et * i . t ie Lal's

¥ at

é ”.

ea i a 4

‘ Je TA TS od : iy ‘ ; . Sr eK ee ce Vy Eee “ be! eS o Py aba a*

aya ms . as * Be eh, ROR TH sy 4 oy Bless i ota Les Ee santos Ys He ae Re yf ¢ i

“4 Cu Yeh ex etatnis Par, 3s OO tle el NR a a eg Ae. A ARLE Set pM HOW, lg Ms Ow Aa Te Big eR RE aD Se Oe) ee ee a ee Scr er ae ee OL ee)

ae a ‘ . ae 4 4 . a rege . : eho ay 3 SPER we Dali o ee

) ee ee wORAY a

: oN

IN THE

Supreme Court of the United States

GERI KANNAPIEN AND JANICE ROZHON,

Petitioners,

Vv.

QUAKER OATS COMPANY AND PEPSICO,

Respondents.

On Petition for a Writ of Certiorari

to the United States Court of Appeals

for the Seventh Circuit

RESPONDENTS QUAKER OATS COMPANY'S

AND PEPSICO’S BRIEF IN OPPOSITION

Quaker Oats Company (“Quaker”) and PepsiCo,

Inc. respectfully submit this brief in opposition to the

petition for a writ of certiorari filed by Geri

Kannapien and Janice Rozhon.

COUNTERSTATEMENT OF THE CASE

Petitioners, former employees of Quaker, brought

this action under the Employee Retirement Income

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

seq., and Illinois state law seeking additional pension

benefits under the Quaker Retirement Plan. The

district court granted summary judgment dismissing

petitioners’ claims. The Court of Appeals for the

Seventh Circuit affirmed, finding that petitioners had

failed to establish any of the required elements of an

estoppel claim under ERISA. Petitioners assert that

the Seventh Circuit’s decision as to one of those

elements -— that a knowing or intentional

MR a ME Meee ee hE GT Ty eg BIRR SUR ONC gy Sa & ST CRE ae ea Te MER SN Tt TRE he Foe Peace re Te ROPES oe Bie 3

° iat Bh! AR eal aie Mee MT Sard Sree pt Bate ail ee eee eee eat el BSH NO ge Na ET Ra Oy. NOOR Oia

misrepresentation have been made — creates a

conflict among the circuits and should be reviewed by

this Court. No conflict is created by this case,

however, because petitioners’ failure to establish any

of the elements of their claim required dismissal

regardless of whether an intentional

misrepresentation is required. Moreover, petitioners

could not prevail under any of the formulations of the

requirements for an ERISA estoppel claim which

petitioners contend are used in other circuits. The

petition should be denied.

I. The Facts

In early 2003, the Quaker Oats Company offered

certain salaried employees who worked at a plant in

Bridgeview, Illinois an opportunity for voluntary

early retirement. If an employee accepted this

opportunity, Quaker would treat the employee’s early

retirement as an involuntary termination, which

would permit the employee to receive two types of

benefits in addition to her normal retirement

benefits. First, the employee would receive severance

benefits under the terms of Quaker’s Severance Pay

Plan (the “Severance Plan”). Second, the employee

would receive additional pension benefits under the

change in control provisions of the Quaker

Retirement Plan (referred to herein as “CIC”

benefits). Under the terms of the Quaker Retirement

Plan, the CIC benefits were payable to employees of

Quaker whose employment was _ involuntarily

terminated within two years after a change in control

of Quaker, and a change in control had occurred

when the stockholders of Quaker voted to approve a

merger of Quaker into a subsidiary of PepsiCo, Inc.

on May 1, 2001.

Petitioners were salaried, at-will employees at

Quaker’s Bridgeview plant. They volunteered for

yi,

early retirement pursuant to Quaker’s offer, and

Quaker terminated their employment in response.

Petitioners’ severance benefits were calculated under

the terms of the Severance Plan, and their pension

benefits, including their CIC benefits, were calculated

under the terms of the Quaker Retirement Plan. The

amounts payable under the Severance Plan and the

amounts payable under the Retirement Plan depend

in part upon a participant’s years of credited service

under each plan. Under the express terms of the

Severance Plan, petitioners’ employment at the

Golden Grain Company, a company Quaker acquired

in 1986, was included in the calculation of their

credited service for severance pay purposes. In

contrast, under the express terms of the Quaker

Retirement Plan, petitioners’ credited service for

pension purposes began on July 1, 1990, the date

they became participants in that plan.!

Petitioners do not dispute that their employment at

Golden Grain was not credited service under the

terms of the Quaker Retirement Plan. Instead,

petitioners point to conversations they had with

Jeffrey Satterlee, a manager at the Bridgeview plant,

in which Satterlee mistakenly told them that the CIC

benefits were to be calculated based on their years of

employment with both Quaker and Golden Grain. It

is undisputed that Satterlee’s mistake was entirely

innocent and that he did not intend to’ mislead

petitioners. It is also undisputed that Satterlee, who

was neither a plan fiduciary nor administrator (see

1As the court of appeals explained, the pre-existing Golden

Grain Profit Sharing Plan remained in effect for some time

following Quaker’s acquisition of Golden Grain and provided

former Golden Grain employees with retirement benefits for the

period prior to their 1990 enrollment in the Quaker Retirement

Plan. Pet. App. 3a-4a, 9a.

th Fay Lt. a's 4

ae ea reas

Ne OE EEE a OS MPa Se ERY tow Ae OF

Pet. App. 19a-21a), instructed petitioners to contact

the Quaker Employee Administration Center to

obtain their actual benefits estimates, because, he

explained, he could not compute their benefits for

them. Satterlee at no time suggested that the early

retirement offer would change any of the terms of the

Quaker Retirement Plan. Jd. at 7a.

Petitioners also point to a benefits estimate

statement each had received some months prior to

the announcement of the early retirement offer,

which listed their credited service date as the date

they were originally hired by Golden Grain. It is

undisputed that this was an inadvertent clerical

error. E.g., Pet. App. 12a. It is also undisputed that

the estimated pension benefit amounts provided in

these statements were calculated using the correct

credited service starting date of July 1, 1990, and

thus accurately reflected the pension benefits

actually payable to petitioners under the Quaker

Retirement Plan.

In connection with the early retirement offer itself,

each petitioner was given a,written summary of the

elements of the offer, which explained that the CIC

and other pension benefits were to be paid from the

Quaker Retirement Plan. The written summary also

explained that the benefits were to be based on “years

of service,” a defined term in the Retirement Plan

tt equates to credited service, which began on July

i, 1990 for petitioners.

After they left Quaker, petitioners realized that

their pension benefits were calculated based upon

their credited service beginning on July 1, 1990, as

required under the Quaker Retirement Plan, and

that their pension benefits did not take into account

their prior employment with Golden Grain. They

filed this lawsuit in response.

Il. The District Court Proceedings

Petitioners’ original complaint alleged estoppel and

breach of fiduciary duty claims under ERISA. After

petitioners were denied leave to amend their

complaint to add a claim for violation of ERISA’s

“anti-cutback” provision, 29 U.S.C. § 1054(g)(1), they

moved for (and were granted) leave to file a Second

Amended Complaint. Petitioners subsequently

sought (and were granted) leave to file their last

complaint, the Third Amended Complaint, which

added two Illinois state law claims to their

previously-asserted ERISA estoppel and fiduciary

duty claims.

The district court granted respondents’ motion for

summary judgment on all claims asserted in the

Third Amended Complaint and _ entered final

judgment. The district court held that petitioners

had failed to support any elements of their claims

under ERISA and that their newly-added state law

claims were preempted. Pet. App. 23a-49a.

Ill. The Decision Of The Court Of Appeals

On appéal, the Seventh Circuit affirmed. Pet. App.

la-22a, reported at Kannapien v. Quaker Oats Co.,

507 F.3d 629 (7th Cir. 2007). In accordance with

long-settled law, the court of appeals noted that to

prevail on an estoppel claim under ERISA, plaintiffs

must show:

(1) a knowing misrepresentation; (2) made in

writing; (3) reasonable reliance on that repre-

sentation by them; (4) to their detriment.

Id. at 1la-12a. The court then reviewed the facts in

the light most favorable to petitioners and found that

“they failfed] to satisfy any required element of an

ERISA-—estoppel claim.” Jd. at 12a. As the court

— a ee nn Pe

explained, “the Retirement Plan unambiguously

defines ‘credited service’ as commencing on July 1,

1990 for both women, and ... neither Kannapien nor

Rozhon can prove that she relied on any knowing

written misrepresentation by Quaker.” Jd. at 19a.

And, the court observed, it was undisputed that

petitioners had received all benefits to which they

were entitled under the Quaker Severance and

Retirement Plans. Id. at 2a, lla, 16a. With respect

to the Illinois state law claims, the Seventh Circuit

affirmed the district court’s determination that those

claims were preempted by ERISA because petitioners

were “pursu[ing] benefits to be paid from the ERISA

Retirement Plan.” Jd. at 2la-22a.2 The Seventh

Circuit subsequently denied petitioners’ petition for

rehearing and rehearing en banc, id. at 50a-51a, and

their motion to stay issuance of the mandate.

REASONS FOR DENYING THE PETITION

The petition purports to present two questions for

review by this Court — one regarding the scope of

ERISA preemption, and the other the knowledge or

intent element of a claim of estoppel under ERISA.

Pet. i. As to the first question, petitioners present no

analysis or argument whatsoever, offering only a

single short restatement of the question itself. Id. at

4. No assertions of a circuit split or any other bases

for review of this question are presented. In light of

petitioners failure to address this question, and

particularly in light of the “clearly expansive” nature

of ERISA’s preemption of state law (see Egelhoff v.

Egelhoff ex rel. Breiner, 532 U.S. 141, 146 (2001)),

»? The court also affirmed the summary judgment dismissing

petitioners’ fiduciary duty claims under 29 U.S.C.

§ 1132(a)(3)(B), Pet. App. 19a-21a, a ruling not addressed in the

petition.

further consideration of this question is unwarranted,

and respondents therefore will address only

petitioners’ second question, relating to ERISA

estoppel.

As to this question, petitioners do present an

argument for review, but their argument is wrong.

Petitioners claim that the Seventh Crrcuit’s

determination that a plaintiff asserting an ERISA

estoppel claim must establish a knowing or

intentional misrepresentation is in conflict with

decisions of the First, Second, Third, Fourth, Fifth,

Sixth, Ninth, and Eleventh Circuits. Pet. 5-7, 9, 11-

13. But, petitioners failed to establish any element of

their estoppel claims, not merely a knowing or

intentional misrepresentation, and they do _ not

challenge the lower courts’ findings in that regard.

Therefore, whether ERISA estoppel does or does not

require a knowing misrepresentation is irrelevant to

the disposition of this case. Moreover, because of

their failure to establish any element of an estoppel

claim, petitioners could not prevail under any of the

alternative standards they propose. Finally, and in

any event, the conflicts plaintiffs see among the

circuits are illusory — nothing more than differences

in wording that have no substantive effect upon the

claims asserted here.

I. THE QUESTION ON WHICH PETITIONERS

SEEK REVIEW IS NOT PROPERLY

PRESENTED IN THIS CASE.

As a threshold matter, the issue petitioners ask this

Court to review, t.e., whether a misrepresentation

must be knowing or intentional to create an estoppel

under ERISA, was not necessary to the decision of

the Seventh Circuit, and thus the disposition of that

issue can have no impact on the ultimate result in

this case. Moreover, even under petitioners’

characterization of the requirements for ERISA

estoppel in other circuits, they could not prevail

under any conceivable standard. For both of these

reasons, the question raised in the petition is not

properly presented for review.

A. Petitioners Failed To Establish Any

Element Of Their Estoppel Claims.

To establish an estoppel claim under ERISA,

plaintiffs were required to show (1) a knowing

misrepresentation; (2) made in_ writing; (3)

reasonable reliance on that representation; (4) to

their detriment. Pet. App. lla-12a (citing Vallone v.

CNA Fin. Corp., 375 F.3d 623, 639 (7th Cir. 2004);

Coker v. Trans World Airlines, Inc., 165 F.3d 579, 585

(7th Cir. 1999)). The Seventh Circuit applied these

requirements in determining that petitioners had

failed to establish their ERISA estoppel claims.

Petitioners argue that one of the requirements

imposed by the court of appeals — a knowing

misrepresentation — is unwarranted and inconsistent

with the law in other circuits. But, the court did not

rest its decision solely on the admitted absence of any

knowing or intentional misrepresentations. To the

contrary, the court found, and petitioners do not

dispute, that none of the other elements of ERISA

estoppel had been established. The only alleged

written misrepresentation was the erroneous credited

service date on the benefits estimate statements

delivered months before any mention of the early

retirement opportunity. Because the _ benefits

statements correctly calculated and reported the

actual amount of each petitioner’s estimated benefits,

the court found that this was not a

misrepresentation, but merely a clerical error. Pet.

App. 14a. While Satterlee did make an oral

misstatement, albeit a concededly innocent one, the

court held that because the terms of the Quaker

Retirement Plan were not ambiguous or misleading,

the oral misstatement could not form the basis for an

estoppel claim. Jd. at 14a. Finally, the court found

no evidence of “any reliance -— detrimental or

otherwise — by [either petitioner]” on any alleged

written misrepresentation. Jd. at 16a; see also id. at

33a-34a & n.4 (no reasonable, detrimental reliance on

any misstatements, oral or written). Therefore,

regardless of any need to show a knowing or

intentional misrepresentation, petitioners failed to

establish an estoppel claim.

B. Even Under Petitioners’ Characteriza-

tion Of The Standards In Other Circuits,

Their Claims Would Fail.

While petitioners largely mischaracterize the

ERISA estoppel standards in other circuits or provide

incomplete descriptions of those standards (see

section II, infra), even under petitioners own

characterizations of the standards, their claims would

fail. The requirement, or lack thereof, of a knowing

or intentional misrepresentation would have no

bearing on the disposition of petitioners’ claims under

any of the standards they present. -

The undisputed facts here show nothing more than

an innocent oral misstatement by a single Quaker

employee, who told petitioners he could not compute

their benefits and who instructed them to consult the

designated internal source for information concerning

employee benefit plans, the Quaker Employee

Administration Center, to obtain a benefits estimate.

Pet. App. 12a-13a. It is undisputed that the Quaker

Retirement Plan itself and the Summary Plan

Description are clear and unambiguous (id. at 13a-

15a), and that the written description of the early

retirement opportunity given’ to _ petitioners

accurately described its terms and made clear that

the early retirement benefits were governed by the

Retirement Plan (id. at 14a-15a). And, it is

undisputed that petitioners received all benefits to

which they were entitled under that Plan. Jd. at 2a,

lla, 16a. On this record, petitioners cannot establish

a claim for ERISA estoppel no matter how the test

may be articulated in a particular circuit.

Petitioners place heavy reliance, for example, on

what they say is the standard in the Second Circuit.

According to petitioners, that circuit requires “(1) a

promise, (2) reliance on the promise, (3) injury caused

by the reliance, (4) injustice if the promise is not

enforced, and (5) ‘extraordinary circumstances.” Pet.

6 (citing Aramony v. United Way Replacement Benefit

Plan, 191 F.3d 140, 151 (2d Cir. 1999)). Putting the

other elements to one side for the moment,

petitioners cannot establish the threshold element —

that respondents made a “promise” to them regarding

the calculation of their benefits. The benefits

estimate statements petitioners received had nothing

to do with the early retirement opportunity and, in

any event, correctly calculated petitioners’ benefits

based on the correct years of service. Nor was

Satterlee’s innocent misstatement a promise

concerning petitioners’ benefits. in: fact, i “is

undisputed that Satterlee told each petitioner that he

could not calculate the amount of her benefits and

that she should contact the Quaker Employee

Administration Center to obtain a benefits estimate.

Id. at 12a-13a. Far from being a “promise,”

Satterlee’s conversations with petitioners are exactly

the type of “commonplace communication from

employer to employee” that the Second Circuit has

made clear cannot form the basis for an estoppel

claim. Aramony, 191 F.3d at 151.

As petitioners concede, one of the required elements

in each of the Third, Fifth, Sixth, and Ninth Circuits

is reasonable and detrimental reliance. Pet. 7-10. As

the lower courts found in this case, petitioners failed

to establish any reasonable reliance — detrimental or

otherwise — on any alleged misrepresentation. Pet.

App. 16a, 33a-34a. With respect to the innocent oral

misstatement by Satterlee in particular, petitioners

cannot show that reliance would have _ been

reasonable in light of the undisputed fact that the

Quaker Retirement Plan is unambiguous and in light

of Satterlee’s caution that he could not calculate

petitioners’ benefits. Jd. at 12a-13a, 33a-34a.

In the Ninth and Eleventh Circuits, a plaintiff must

show that the plan terms were ambiguous and that

the misrepresentation concerned an oral

interpretation of that ambiguity. See Pet. 8-9, 11.

Similarly, petitioners assert that the First Circuit has

“noted that a narrow window for estoppel recovery

might be possible where the representation relied

upon reflected an interpretation of ambiguous plan

terms.” Jd. at 14 (citing Law v. Ernst & Young, 956

F.2d 364, 370 n.9 (1st Cir. 1992)). Here, petitioners

have conceded that the terms of the Quaker

Retirement Plan were neither ambiguous nor

misleading (Pet. App. 14a, 15a).

3 The Third, Fifth, and Ninth Circuits, like the Second! Circuit,

also require “extraordinary circumstances” (Pet. 7-9), and

petitioners have established nothing more than an innocent

misstatement by a Quaker employee, who told petitioners that

he could not compute their benefits. These circumstances are

not “extraordinary” under any formulation of that element.

Indeed, as petitioners point out (id. at 8 n.3), the Fifth Circuit

has refused to find extraordinary circumstances where an oral

representation was inconsistent with the clear terms of the plan.

Finally, petitivmers acknowledge that estoppel is

unavailable in the Fourth Circuit when “it would

effect an amendment to a written ERISA plan.” Pet.

12 (citing HealthSouth Rehab. Hosp. v. Am. Nat'l Red

Cross, 101 F.3d 1005, 1010-12 (4th Cir. 1996)). Given

that the unambiguous terms of the Quaker

Retirement Plan provide that petitioners’ credited

service began on July 1, 1990, a fact petitioners

concede (Pet. App. 14a), petitioners’ claims for

benefits using earlier credited service dates, if

successful, would necessarily “effect an amendment

to 4 written ERISA plan.”

In the end, this case, involving an innocent oral

misstatement concerning the calculation of credited

service pursuant to the terms of an unambiguous

ERISA plan, does not present the question on which

petitioners seek review — whether an ERISA estoppel

claim requires proof that a misrepresentation was

knowing or intentional. Because petitioners cannot

prevail under any standard, regardless of the answer

to this question, the petition should be denied.

II. THERE IS NO CONFLICT AMONG THE

CIRCUITS CONCERNING THE APPLICA-

TION OF ERISA ESTOPPEL TO THE

CLAIMS ASSERTED BY PETITIONERS.

As noted above, the elements of an ERISA estoppel

claim as articulated by the Seventh Circuit are (1) a

knowing misrepresentation, (2) made in writing, (3)

on which the plaintiffs reasonably relied, (4) to their

detriment. Pet. App. lla-12a. These are the same

elements recognized and applied in every circuit cited

by petitioners. While different circuits use different

verbal formulations when articulating ’§ the

requirements for an ERISA _ estoppel claim,

petitioners have not identified any differences that

matter for purposes of their claims. In particular,

although some _ circuits use the rubric of

“extraordinary circumstances,” while others

articulate a separate, stand-alone element, every

circuit that has squarely addressed the question

requires some form of knowing or intentional

misrepresentation as a predicate for an estoppel

claim under ERISA. Those circuits that have not

imposed that requirement simply have not confronted

the issue.

The Third Circuit, for example, requires a plaintiff

to establish “extraordinary circumstances” in

addition to the other elements of an estoppel claim

(i.e., material misrepresentation, reasonable reliance,

detriment to plaintiff). See, e.g., Curcio v. John

Hancock Mut. Life Ins. Co., 33 F.3d 226, 235 (3d Cir.

1994), cited at Pet. 8. The Third Circuit explained

the “extraordinary circumstances” requirement in

Kurz v. Phila. Elec. Co., 96 F.3d 1544, 1553 (3d Cir.

1996), where it held that “extraordinary

circumstances” ordinarily require “affirmative acts of

fraud or similarly inequitable conduct by an

employer.” An estoppel claim will not lie for “simple

ERISA reporting errors or disclosure violations,”

including even omissions that cause employees to lose

or to fail to qualify for benefits. Jd. (citing Gillis v.

Hoechst Celanese Corp., 4 F.3d 1137, 1142 (8d Cir.

1993); Gridley v. Cleveland Pneumatic Co., 924 F.2d

1310, 1319 (38d Cir. 1991)). An innocent, one-time

4The Third Circuit noted in Kurz that it also has found

extraordinary circumstances based on a “network of

misrepresentations that arises over an extended course of

dealing between parties” and that it considers “the vulnerability

of particular plaintiffs” (e.g., hospital patients erroneously told,

while hospitalized, that they had adequate medical coverage).

96 F.3d at 1553. Neither a “network of misrepresentations” nor

particular vulnerability was alleged or sown here.

misstatement, such as that at issue here, cannot

support an ERISA estoppel claim in the Third

Circuit.

Nor can it do so in the Ninth Circuit, which also

requires “extraordinary circumstances.” The Ninth

Circuit decisions cited by petitioners, Spink v.

Lockheed Corp., 125 F.3d 1257 (9th Cir. 1997), and

Pisciotta v. Teledyne Indus., Inc., 91 F.3d 1326 (9th

Cir. 1996) (per curiam), both rest on that court’s

earlier decision in Greany v. Western Farm Bureau

Life Insurance Co., 973 F.2d 812 (9th Cir. 1992),

which set out the elements of an equitable estoppel

claim concerning an ERISA plan. See Spink, 125

F.3d at 1261; Pisciotta, 91 F.3d at 1331. Those

elements include proof that “the party to be estopped”

— that is, the party who made the alleged

misrepresentation — “must know the facts.” Greany,

973 F.2d at 821. In other words, a knowing

misrepresentation is required.

Eleventh Circuit precedent is to the same effect.

Petitioners cite Cotton v. Massachusetts Mutual Life

Insurance Co., 402 F.3d 1267 (11th Cir. 2005), for the

proposition that the Eleventh Circuit “requires only

an oral statement and _ representation which

constitutes an oral interpretation of the plan, without

requiring intent to deceive,” Pet. 11, but petitioners’

description of the required elements is incomplete.

The standard for ERISA estoppel was first

articulated in the Eleventh Circuit in Kane v. Aetna

Life Insurance, 893 F.2d 1283 (llth Cir. 1990). In

that case, the court held that where the provisions of

the ERISA plan are ambiguous, and representations

are made that constitute an interpretation of the

ambiguity as opposed to oral amendments or

modifications of the plan, then “{t]he federal common

law of equitable estoppel may be applied to the facts

of [the] case.” Id. at 1286. “The elements of equitable

estoppel, as defined by federal common law,” include

“(1) the party to be estopped misrepresented material

facts; [and] (2) the party to be estopped was aware of

the true facts ....”. Busby v. JRHBW Realty, Inc., 513

F.3d 1314, 1326 (11th Cir. 2008). Thus, again, an

estoppel can arise only where a_e knowing

misrepresentation is shown.

The Sixth Circuit’s formulation is_ virtually

identical. That court requires, among other things,

conduct or language amounting to a

misrepresentation of material fact and an awareness

of the true facts by the party to be estopped. See

Armistead v. Vernitron Corp., 944 F.2d 1287, 1298

(6th Cir. 1991), cited at Pet. 10; see also Trs. of Mich.

Laborers’ Health Care Fund v. Gibbons, 209 F.3d 587,

591 (6th Cir. 2000). If the party making the

misrepresentation, t.e., the party to be estopped, is

aware of the true facts, then that party has made a

knowing misrepresentation. See also Crosby v. Rohm

& Haas Co., 480 F.3d 423, 431 (6th Cir. 2007) (“Far

from trying to deceive Allred.... [aJt most, Crosby has

shown that the company made an honest mistake,

that in other words it was guilty of misfeasance, not

the malfeasance that estoppel requires.”).

Although petitioners also point to the First, Second,

Fourth, and Fifth Circuits as having adopted rules

that conflict with the Seventh Circuit’s decision, in

reality only the Second Circuit has considered ERISA

estoppel in any depth. As petitioners note, the

Second Circuit requires “extraordinary

circumstances” — in particular, that a promise be

made with the specific intent to induce the employee

to take action favorable to the employer. Pet. 6-7. As

that court has explained, the “extraordinary

circumstances” element “require[s] conduct

tantamount to fraud,” making clear that reliance on

an employer’s innocent misstatement will not suffice.

Greifenberger v. Hartford Life Ins. Co., 131 F. App’x

756, 759 (2d Cir. 2005) (citing Devlin v. Transp.

Comme'ns Int'l Union, 173 F.3d 94, 101-02 (2d Cir.

1999)).5

The remaining circuits listed by petitioners — the

First, Fourth, and Fifth — simply have not addressed

in any fashion whether the misrepresentation that

forms the basis for an ERISA estoppel claim must

have been made with knowledge of falsehood or

intent to deceive. Petitioners acknowledge as much

concerning the First Circuit, noting that it “has not

yet definitively chosen a position.” Pet. 13 (citing

Livick v. The Gillette Co., 524 F.3d 24 (1st Cir.

2008)).6 The First Circuit has suggested in dictum

that, if it were to consider an ERISA estoppel claim,

it would require “definite misrepresentations of

fact,” Mauser v. Raytheon Co. Pension Plan for

Salaried Employees, 239 F.3d 51, 57 (1st Cir. 2001),

but it has not yet considered such a claim, and what

constitutes a “definite misrepresentation of fact” is

therefore unknown. The Fourth Circuit, as noted

supra at 12, does not permit an estoppel claim where

the requested estoppel would effect an amendment to

5 Greifenberger is consistent with Schonholz v. Long Island

Jewish Medical Center, 87 F.3d 72 (2d Cir. 1996), the case in

which the Second Circuit first articulated the “extraordinary

circumstances” requirement. There, as the court explained in

Devlin, the employer had “intentionally used the promise of

severance benefits to win Schonholz’s resignation, and then

reneged once she resigned.” Devlin, 173 F.3d at 102.

6 Petitioners assert that First Circuit panels have recognized

“the direct split among circuits,” Pet. 14, but the discussion they

cite concerns whether an ERISA estoppel claim should be

permitted at all, not the elements of such a claim.

a written ERISA plan. Finally, the Fifth Circuit, like

the Second, Third, and Ninth Circuits, requires

“extraordinary circumstances.” See High v. E-Sys.

Inc., 459 F.3d 573, 579 (5th Cir. 2006). The Fifth

Circuit has not addressed whether a knowing or

intentional misstatement is required for an ERISA

estoppel claim. It has, however, looked to Third

Circuit caselaw for guidance concerning

“extraordinary circumstances,” see id. at 580 & n.3.

In the Third Circuit, as noted above, a negligent

misstatement will not suffice.

So, far from showing a clear conflict warranting

this Court’s attentiun, petitioners have established

only that some circuits have addressed the knowing

misrepresentation question and others have not and

that, among those that have, differences in phrasing

can be found. That such differences exist is hardly

surprising in light of the fact-specific nature of

estoppel claims. What matters for present purposes

is that, substantively, there is neither conflict nor

confusion in the lower federal courts concerning any

question properly presented here. Under no

circumstances can a claimant prevail on an ERISA

estoppel claim based on an _ innocent oral

misstatement by a non-fiduciary, non-administrator

who directs claimants to the proper source for

information concerning an unambiguous ERISA

pension plan.

CONCLUSION

The petition for writ of certiorari should be denied.

Respectfully submitted,