Calder v. SBC Pension Benefit Plan, No. SA-07-CA-340-XR (W.D. Tex.)

Calder is a pension benefits case filed in early 2006 that challenges whether certain amendments to the AT&T Pension Benefit Plan that caused a significant reduction in participants’ benefits ever became effective.

The Calder Complaint alleges that the amendments, known as the “actual base pay” amendments, never became effective due to AT&T’s failure to comply with the strict notice requirements of ERISA § 204(h), 29 U.S.C. § 1054(h). Plaintiffs allege that they are each entitled to addition benefits as a result.

ERISA § 204(h) requires as a precondition for an amendment significantly reducing the rate of future benefit accruals to become valid and legally effective, a plan administrator to issue advance notice to plan participants of any such amendment according to strict guidelines. If the requirements of ERISA § 204(h) are not satisfied, the plan amendment does not go into effect, i.e., is essentially void, at least as to any participant not receiving adequate notice.

In this case, Plaintiffs allege that the “actual base pay” amendments never became effective as to them or other members of the proposed Class because AT&T (the Plan administrator as well as Plan sponsor) either gave no notice whatsoever to affected participants or when it did it failed to set forth the amendment’s terms or provide in timely fashion an accurate summary of the amendment written in a manner calculated to be understood by the average plan participant.

The AT&T Defendants have moved to dismiss the case or have it transferred to the Western District of Texas. That motion is fully briefed and awaiting decision by the Court. A ruling is expected sometime in the Fall of 2006.

We successfully defeated the AT&T Defendants’ motion to have the case dismissed in a ruling issued in late March 2008 by the Honorable Xavier Rodriguez. See Calder v. SBC Pension Ben. Plan, No. SA-07-CA-340-XR, 2008 WL 828044 (W.D.Tex., March 27, 2008). The case is currently stayed pending the conclusion of settlement negotiations in the related Wagener action.