Bator v. Dist. Council 4, Graphic Communications Conference

Dist. Ct. did not err in dismissing for failure to state cause of action plaintiffs-former union members’ lawsuit under ERISA, alleging that defendants-pension plan Trustees and union breached their fiduciary duties through actions and inactions that resulted in underfunding of their pension plan. While plaintiffs alleged that defendants breached their fiduciary duty by not enforcing either terms of Trust Indenture or union by-laws when they allowed certain members of union to contribute to fund at lower rates, record showed that Trustees had broad discretion to interpret terms of Trust Indenture, and that Trustees’ interpretation that allowed certain members of union to participate in pension plan at lower rates was not arbitrary or capricious, where language in Trust Indenture indicated that different segments of participating local union can increase contribution levels so long as formula applied to all members of that segment. Dismissal was also warranted with respect to defendant-union, since union was not acting as fiduciary when it set contribution rates. Fact that union controlled amount of revenue coming into pension plan did not require different result.