Carlson v. Northrup Grumman Severance Plan

Dist. Ct. did not err in granting defendants’ motion for summary judgment in plaintiffs-laid-off employees’ action, alleging that defendants violated ERISA by falling to give them severance pay upon their layoffs, where defendant gave severance pay to other co-workers when they were laid off. Under plan’s language, defendants had discretion to choose who, if anyone, got severance pay on being laid off, and plan required that defendant’s H R Department notify those who would be getting severance pay with specific memorandum, which plaintiffs did not receive. Ct. of Appeals further observed that plaintiff’s argument improperly assumed that defendant’s H R Department, which determined who would receive said memorandum, was their fiduciary, which it was not, and plaintiff could not prevail under ERISA, when they did not qualify for benefits under plan’s terms.