Plaintiffs in the case Amara v. CIGNA, concerning CIGNA’s switch from a traditional defined benefit (DB) plan to a cash balance plan last April alleged that CIGNA is not following new calculations ordered by a federal court to remedy its breach of providing inadequate disclosures to participants about its conversion from a traditional defined benefit plan to a cash balance plan.
On August 16, 2019, the U.S. District Court for the District of Connecticut issued a ruling that denied aspects of the plaintiffs’ Motion to Enforce Court Rulings and for Sanctions. Specifically, the court ruled that CIGNA was in compliance with an earlier ruling that set forth the method for converting already-paid lump sum retirement benefits into annuities. In reaching that conclusion, the court clarified and reiterated its prior ruling that CIGNA was to utilize the mortality tables and interest rates in effect at the time the lump sum was received.
The plaintiffs in the suit argued that CIGNA violated the court’s rulings by, among other things, using “outdated” mortality tables from the date of the Part B lump sum distributions rather than the “successor” mortality tables applicable under the plan provisions on the “Applicable Mortality Table” to annuitize the offsets that the court allowed CIGNA to take.
The plaintiffs also argued that CIGNA violated the court’s rulings by eliminating early retirement benefits until the “later of” the Part A early retirement age or the date the Part B cash balance account is distributed.
In its decision last August, the court declined to entertain a methodological dispute regarding the payment of early retirement benefits because the plaintiffs had not pursued that issue in their motions related to methodology.
On August 23, 2019, the plaintiffs moved for reconsideration of these aspects of the court’s enforcement ruling, but the court has now denied their motion. The court agreed with CIGNA that the plaintiffs are essentially attempting to relitigate issues already decided. “Plaintiffs’ Reconsideration Motion does not present any previously overlooked decisions or facts, but instead restates the arguments presented in their Enforcement Motion and subsequent reply,” the court said in its order.