Harrison v. PNC Fin. Servs. Grp.

MICHAEL HARRISON, Plaintiff, v. THE PNC FINANCIAL SERVICES GROUP, et al., Defendants.

Case No. 3:12-cv-14

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF OHIO WESTERN DIVISION

August 26, 2014

JUDGE WALTER H. RICE

DECISION AND ENTRY OVERRULING PLAINTIFF'S MOTION FOR JUDGMENT ON THE ADMINISTRATIVE RECORD (DOC. #30); SUSTAINING IN PART AND OVERRULING IN PART DEFENDANTS' MOTION FOR JUDGMENT ON THE ADMINISTRATIVE RECORD (DOC. #29); GRANTING JUDGMENT IN FAVOR OF DEFENDANTS ON THE CLAIMS FOR FAILURE TO PRODUCE DOCUMENTS (COUNT FOUR) AND FAILURE TO CONSIDER ALL OF CLAIMANT'S INFORMATION (COUNT FIVE) OF PLAINTIFF'S SECOND AMENDED COMPLAINT (DOC. #17); STRIKING THE CLAIM FOR BREACH OF FIDUCIARY DUTY (COUNT TWO) AND DISMISSING WITHOUT PREJUDICE THE CLAIM FOR ATTORNEYS' FEES (COUNT THREE); ORDER REMANDING THE CLAIM FOR BENEFITS (COUNT ONE) TO THE PLAN ADMINISTRATOR FOR A FULL AND FAIR REVIEW IN ACCORDANCE WITH THIS DECISION; TERMINATION ENTRY

Michael Harrison ("Plaintiff" or "Harrison") filed suit against The PNC Financial Services Group ("PNC Group"), The PNC Financial Services Group, Inc., ("PNC"), the National City Corporation Amended and Restated Management Severance Plan (the "Plan"), and the Compensation and Organization Committee of the Board of National City Corporation (the "Committee") (collectively,"Defendants"), alleging that Defendants improperly denied his claim for severance benefits. Harrison seeks declaratory relief, an award of benefits, attorneys' fees and costs, civil penalties, and punitive damages based on his claims, all of which arise under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. This Court has jurisdiction over ERISA claims pursuant to 29 U.S.C. § 1132(e)(1).

Pending before the Court are the parties' Cross-Motions for Judgment on the Administrative Record. The Court has reviewed the arguments set forth in the parties' memoranda, the administrative record, and the applicable law. For the reasons set forth below, the Court OVERRULES Plaintiff's Motion (Doc. #30) and OVERRULES IN PART and SUSTAINS in PART Defendants' Motion (Doc. #29).

1. BACKGROUND AND PROCEDURAL HISTORY¹

Harrison began working for National City Corporation ("National City") in June of 2005. 2d Am. Compl. ¶ 12 (Doc. #17 at 3); Answer ¶ 12 (Doc. #18 at 4). National City offered a severance plan, originally drafted in 2005, to certain of its senior employees. AR at 1, Plan § 1.1 (Doc. #19-1 at 1). On September 30, 2008, National City implemented an updated version of the severance plan, the National City Corporation Amended and Restated Management Severance Plan (the "Plan"). Id. The Plan's stated purpose was "to maximize the Corporation'sprofitability and operating success by attracting and retaining key managerial, operational and executive employees and allowing them to focus on their responsibilities in the event of, and following, a Change in Control." Id. at 1, § 1.2. A "Change in Control" included a merger or other corporate reorganization. Id. at 2-5, § 2.1(d).

Only National City employees who met the Plan's definition of a "Participant" were eligible for severance benefits. Id. at 7, § 3. The Plan defined a "Participant" as:

[A]n Employee whose job is assigned to a grade level within the range of grade level 1 through grade level 7 pursuant to the Corporation's system for grading jobs, excluding those Employees who are covered by an employment agreement, severance agreement, or other specialized plan at the earlier of the (i) time of termination or [ii] the Implementation Date that address severance benefits.

Id. at 6, § 2.1 (r). The Plan defined the "Implementation Date" as the earliest of a series of events related to a corporate merger or restructuring. Id. at 6, § 2.1 (m). The benefits for an eligible Participant included a year of severance pay, which included the Participant's "base salary," bonuses and incentive pay, and, in lieu of employee benefits, an additional one quarter percentage of the participant's base salary. Id. at 8, § 4.1. The Plan set a fifteen month period as the "Protection Period," during which time a Participant would be eligible for severance benefits if he or she faced involuntarily termination. Id. at 7, § § 2.1 (u) & 3.1. In addition, the Plan allowed a Participant to voluntarily terminate his or her employment andclaim severance benefits in the event of either a salary reduction or a relocation to a new principal place of work more than 50 miles away. Id. at 7-8, § 3.2.

In December 2008, PNC acquired National City. 2d Am. Compl. ¶ 12 (Doc. #17 at 3); Answer ¶ 12 (Doc. #18 at 4). The Plan Administrator construed the Plan's defined "Implementation Date" as December 31, 2008, based on the Change of Control that occurred because of the acquisition. Id. at 35-36.²

On March 15, 2010, Harrison provided PNC with two weeks' written notice of his intent to voluntarily terminate his employment and formally requested severance benefits under the Plan. AR at 1 6 (Doc. #19-1 at 16). Harrison stated that PNC's enlargement of his "assigned geographic region" to nine states in addition to Ohio had the effect of changing his principal work location by a distance of more than 50 miles, thereby entitling him to "full severance benefits" under the Plan. Id.

On April 28, 2010, PNC, though a letter from John R. Johnson, its Chief Counsel, acknowledged that Harrison had asserted a claim for severance benefits under the Plan. Id. at 17. In the letter, PNC informed Harrison that he was not an eligible Participant in the Plan because he had not been promoted to the grade level of E07 until after the "Implementation Date" of December 31, 2008. Id. PNC advised Harrison that he was free to file a claim with the Plan Administrator. Id.

On May 25, 2010, through counsel, Harrison submitted a claim for benefits to the Plan Administrator. Id. at 21. In the claim, Harrison asserted that he had been promoted to the E07 grade level that would qualify him for severance benefits before December 31, 2008: "Beginning in June 2005 and continuing through March 2007, Mr. Harrison was employed as the Midwest Division Sales Manager, which position was assigned an E07 grade level and was severance eligible." Id. at 22-23. Harrison also pointed out that he was "promoted to a Regional Manager position, which was identified as a 'severance eligible' position," on July 1, 2009.

In support of his claim, Harrison submitted five documents. The first document was an undated "Information Statement" from PNC stating that Harrison's PNC Job title was "MTG ORIG REGIONAL MGR" and his PNC Grade was 25. Id. at 26. Second, Harrison submitted an email chain containing emails dated October 1, 2009, and October 5, 2009. Id. at 27. The October 1, 2009, email was from Catherine Grover, to a group of persons that did not include Harrison. It stated that "a change [] will be effective January 1, 2010, for our Loan Officers and Supervising LOs," that would replace the "National City Severance Plan" with the "PNC Severance Plan." Id. at 27. Under the new plan, any "eliminate[d] Loan Officers" would be paid severance benefits based on their years of experience, as set forth on a schedule included with the email. Id. The October 5, 2009, email was from one of the recipients of Grover's email, who forwarded it to a group of persons that included Harrison.

Harrison also submitted a Memorandum dated June 26, 2009, from "Human Resources" to "Mortgage Origination Employees."³ Id. at 28. The Memorandum stated that a review of positions had been performed to determine whether certain employees "would be eligible to participate in the National Severance Benefits Plan." Id. According to a table in the Memorandum, persons with the title "Mortgage Origination Regional Manager" were eligible for the National City Severance Benefits Plan. Id.

The fourth document that Harrison submitted contained a series of "Frequently Asked Questions" about the "Management Severance Plan." Id. at 30. It stated that the "contemplated transaction" with PNC would qualify as a "Change in Control" and summarized that plan's requirements for benefits eligibility. Id.

The fifth document that Harrison submitted with his claim was an email dated July 13, 2009, from a PNC manager that announced a reorganization of National City's "Midwest Division from four regions to six." Id. at 32. Harrison was identified as the Regional Manager of the Southwest Ohio and Central Ohio regions of the Midwest Division. Id. The email also contained an organizational chart that identified the employees above and below Harrison in the Midwest Division. Id. at 33.

On July 27, 2010, the Plan Administrator wrote to Harrison's attorney and informed him that Harrison's claim had been denied. Id. at 34. The PlanAdministrator acknowledged receiving the documents that Harrison had submitted, but stated that none of them indicated that Harrison had the grade level of E07 as of December 31, 2008, that would entitle him to severance pay. Id. at 35. PNC's records indicated that Harrison's grade level was E50 as of that date, and the Plan Administrator therefore concluded that Harrison was not eligible for severance benefits under the Plan. Id.

On August 31, 2010, Harrison's attorney sent a letter to the Plan Administrator requesting "copies of all documents, files, records, and information, which directly or indirectly relate to or concern Mr. Harrison's demand for severance benefits," including his personnel file and a copy of the Plan. AR at 37 (Doc. #19-2 at 1). Follow up letters were sent on September 17, 2010, and September 23, 2010. Id. at 39-40.

On October 7, 2010, the Plan Administrator responded, but refused to provide all the documents that Harrison had requested, finding many of them "beyond the scope of what is required to be produced . . . under ERISA." Id. at 45. The Plan Administrator did provide documentation regarding Harrison's job title and grade as of December 31, 2008...