The U.S. District Court for the
Eastern District of Louisiana found that the evidence presented by Mothe
Life Insurance Company would allow “a reasonable trier ‐ of – fact to find that an ERISA plan did not exist.”
The court previously held that the agreement between Mothe Life Insurance and
Emile Mothe lacks clear procedures for receiving benefits.
However, the company presented Massachusetts Mutual Life Insurance Company Prototype Flexinvest
Profit ‐
Sharing/401(k) Plan to its current motion for summary judgment,
saying it supplements the procedures contained within the deferred
compensation agreement with Mothe, and the agreement
coupled with Mothe Life’s plan documents show that the agreement had sufficient procedures such that an ERISA plan was in existence.
The court found that the
only mention of the plan is contained in one paragraph and recites as follows:
“Whereas, Mothe [Life] and Emile [Mothe] both want to provide to Emile [Mothe], as
additional compensation for his services to Mothe [Life], a post-retirement
income (or pre-retirement benefits to his beneficiary) over and above what will
be available to him under Mothe [Life’s] regular pension and insurance plan for
employees.” The court said additionally, the regular retirement plan does
not reference the 1999 agreement between Mothe and Mothe Life.
This court found that this one paragraph does not provide enough guidance for a reasonable
person to reference the plan in order to ascertain the needed
procedures. The plan is acknowledged in the agreement only to recognize
that Emile Mothe will get additional compensation above and beyond his regular
pension and insurance. The court said a reasonable person could not ascertain
the procedures for receiving benefits by this one statement in the agreement.
(Cont...)
On July 20, 1999, Mothe Life Insurance Company entered into a deferred
compensation agreement to pay Emile Mothe, III the sum of $9,000 a month for a
period of 120 months following his retirement, or pay $9,000 a month for 120
months following his death to his beneficiary.
Emile Mothe died on July 5, 2003,
while still employed at Mothe Life, which began making payments to
his wife Margaret, but discontinued the payments in July 2010. Margaret
Mothe sued for continuation of the payments, but Mothe Life argued it was
permitted to terminate the agreement at any time because it constituted a “top
hat” welfare benefit plan under ERISA, and ERISA permits employers to
unilaterally terminate top hat welfare benefit plans at any time.