Third Circuit Rejects Claim for Lifetime Medical Benefits

Proskauer - Employee Benefits & Executive Compensation Blog

Several retired employees of Dominion Energy Transmission, Inc. sued their former employer alleging that they were entitled to lifetime healthcare benefits, and the unilateral changes made by Dominion to their post-retirement medical benefits violated ERISA.  The Third Circuit concluded that the retirees failed to state a claim.  Applying ordinary principles of contract interpretation, the Court concluded that the CBA did not “clearly and expressly” vest the retirees with lifetime benefits.  In so ruling, the Court rejected the retirees’ argument that because the Plan required union consent before altering medical benefits and also did not include a general durational clause, it could be inferred that “the parties clearly expressed their intent to vest post-retirement medical benefits.”  The “absence of a termination clause combined with a consent clause does not clearly and expressly vest retirees” with lifetime benefits, said the Third Circuit.  The case is Blankenship v. Dominion Energy Transmission, Inc., No. 19-3374, 2020 WL 3397740 (3d Cir. 2020).

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