Shaver v. Siemens Corp. (Third Circuit)

This ERISA case involved claims for early retirement benefits by former employees of a Siemens power plant. Siemens purchased the power plant from Westinghouse in 1997, hiring all of the power plant employees as part of the transaction and agreeing to provide them with substantially similar retirement benefits. Under the Westinghouse retirement plan, the employees were entitled to certain early retirement benefits called permanent job separation (“PJS”) benefits. Under the new Siemens retirement plan, PJS benefits were no longer offered. Siemens later shut down the plant, terminating most of the workers’ employment. Two hundred-twenty seven former employees later sued, seeking PJS benefits from Siemens on the complex legal theory that Siemens’s decision not to offer PJS benefits was a violation of ERISA’s anti-cutback and spin-off rules. The district court granted summary judgment to 20 of the class members, but denied it with respect to the rest on the basis of certain waivers they had signed when they were terminated. Siemens appealed as to the 20 class members and sought interlocutory review as to the rest. The Third Circuit accepted appellate jurisdiction over the entire case and—describing the matter as “hyper-complicated”—reversed the district court’s order and remanded with instructions that judgment be entered in favor of Siemens as to all 227 class members. As a result of the victory, litigation that had been pending for a decade was brought to a close, and Siemens avoided as much as $40 million in potential liability.