On occasion, employees in Chicago with denied claims for employee benefits (whether pension benefits, long term disability benefits, or life insurance and accidental insurance benefits) will attempt to handle the administrative appeal of a denial or litigation of the claim on their own. Often, claimants believe they do not need an attorney until they proceed to court in litigating their claim. Waiting until this stage, though, can be devastating. Courts generally review denials of benefits in a “review proceeding” style, meaning the court will review the record and arguments created during the administrative appeal before the administrator or insurer. It may become difficult even for a seasoned ERISA litigator to take a case once it is ripe for litigation when the lawyer had no hand in shaping the record of facts and positions before the administrator. A recent dispute over pension benefits highlights just how difficult these cases can be when the claimants do not involve ERISA counsel early in the process.
In Walton v. National Integrated Group Pension Plan, No. 14-1819, 2014 U.S. App. LEXIS 23370 (7th Cir. Dec. 12, 2014), Mr. Walton disputed the amount of monthly pension he received from a multiemployer pension plan. Mr. Walton had only worked for his employer l4 months, thereby earning him one pension unit, though this was not enough credits for his pension to vest. But when his former employer withdrew from the plan, its share of the pension assets was greater than its obligations to vested employees. The plan had committed that surplus to go to employees who were not vested, which included Mr. Walton.
When Mr. Walton received a surprise pension check for $8.10 after turning 65, he thought the amount was too small, though he never articulated during the administrative process what the proper pension amount should have been under the terms of the plan. The plan explained that its calculation of Mr. Walton’s monthly benefit was based on his the one year of service pension-unit he had earned. Despite reading Mr. Walton’s brief very liberally, the district court sided with the plan, due in large part to the lack of any explanation in the record for how the pension administrator miscalculated Mr. Walton’s pension amount. The court found no reason to overturn the administrator’s determination of Mr. Walton’s pension amount. Upon appeal to the United States Court of Appeals for the Seventh Circuit, the court affirmed the district court’s decision.
Perhaps the pension fund administrator was correct about its calculation, and perhaps Mr. Walton lost simply because he never provided evidence in the record and an explanation of how the fund administrator miscalculated that pension. If Mr. Walton had obtained the guidance of an experienced ERISA attorney from the outset, he could have better evaluated whether it was worth his time or money to litigate this case. If you have a question about your pension benefits, or other benefit determinations, contact a knowledgeable ERISA attorney today.