Moyle v. Liberty Mutual Retirement Benefit Plan (Ninth Circuit)
The question presented in this petition for rehearing en banc is whether a class of 1,166 employees—hired by Liberty Mutual some twenty years ago as part of a corporate acquisition—may be entitled to an equitable remedy requiring Liberty Mutual to pay them pension benefits to which they did not contribute and which their plan administrator reasonably concluded the plan terms do not provide, all because Liberty Mutual failed to anticipate and clear up their misunderstanding of the terms of the plan when they were hired. Proper resolution of this question is a matter of tremendous practical importance. Read aggressively, the panel opinion appears to impose an unworkable burden on employers to read the minds of their employees and to correct all possible misimpressions concerning the terms of their pension plans. It thus opens the door for every plaintiff with a losing claim for benefits to recast her claim as an equitable request for “reformation” on the ground that her plan fiduciaries did not predict and correct her misimpression about the terms of her plan. If that became the law of this circuit, ERISA-protected plans would cease to mean what they say and would come to mean, instead, whatever plan participants imagined them to say. That result would rob plan sponsors of their discretion to design and interpret their own plans. Mayer Brown was retained to file a petition for rehearing en banc.