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Ruiz v. Publix Super Markets, Inc.

United States District Court, M.D. Florida, Tampa Division

May 3, 2017

ARLENE RUIZ, Plaintiff,
v.
PUBLIX SUPER MARKETS, INC., Defendant, PUBLIX SUPER MARKETS, INC., Defendant/Counter-Plaintiff
v.
ARLENE RUIZ, ALEXANDER PEREZ-VARGAS, ANDREA VARGAS, and JESSICA VARGAS, Counter-Defendants.

          ORDER

          SUSAN C. BUCKLEW UNITED STATES DISTRICT JUDGE.

         This cause comes before the Court on Publix's Motion for Attorneys' Fees. (Doc. No. 56). Plaintiff Arlene Ruiz opposes the motion. (Doc. No. 60). As explained below, Publix's motion is denied.

         I. Background

         Irialeth Rizo is a former Publix employee who died from cancer on January 19, 2015. During her employment with Publix, Rizo participated in the Publix Super Markets, Inc. Employee Stock Ownership Plan (“ESOP”) and the Publix Super Markets, Inc. 401(k) SMART Plan (“401(k) Plan”). The Summary Plan Descriptions for the ESOP and the 401(k) Plan both provide that in order to change the designated beneficiary, the participant must fill out and submit a signed Beneficiary Designation Card. In October of 2008, Publix received Beneficiary Designation Cards from Rizo changing her prior designated beneficiaries for both her ESOP and 401(k) Plan to Counter-Defendants Alexander Perez-Vargas, Andrea Vargas, and Jessica Vargas. In September of 2011, Rizo was diagnosed with cancer. In January of 2015, when Rizo was getting her affairs in order after her cancer had progressed, Rizo attempted to change her beneficiaries for both her ESOP and 401(k) Plan to Plaintiff Arlene Ruiz.[1] Rizo did so by sending a letter stating this intention and attaching that letter to unsigned Beneficiary Designation Cards.

         Rizo died on January 19, 2015. Thereafter, Publix received Rizo's letter, as well as the Beneficiary Designation Cards. Publix did not process the proposed beneficiary changes, because the Beneficiary Designation Cards were not properly filled out, as Rizo had not signed and dated them. When Ruiz made a claim for benefits under the ESOP and the 401(k) Plan after Rizo's death, Publix denied her claim. Thereafter, Ruiz filed the instant lawsuit for ERISA benefits.

         Both parties moved for summary judgment on the issue of whether Ruiz was the beneficiary of Rizo's ESOP and 401(k) Plan. Publix argued that Ruiz was not the beneficiary, because Rizo did not strictly comply with the requirements for filling out the Beneficiary Designation Cards in order to make Ruiz the beneficiary of her ESOP and 401(k) Plan. Ruiz argued that the doctrine of substantial compliance applied, and because Rizo substantially complied with the procedure for changing her beneficiary to Ruiz, the Court should find that Ruiz was the beneficiary of Rizo's ESOP and 401(k) Plan.

         The Court found that the case law cited by the parties supported both of their positions and that based on their cited authority, it was unclear whether the Eleventh Circuit would apply the doctrine of substantial compliance. However, the Court also noted that it was not clear that the doctrine of substantial compliance is still viable after the Supreme Court's decision in Kennedy v. Plan Administrator for DuPont Savings and Investment Plan, 555 U.S. 285 (2009). Neither party addressed, or even cited to, the Kennedy decision.

         In Kennedy, the decedent's estate and the decedent's ex-wife both made claims as the beneficiary of a savings and investment plan (“SIP”), which was an ERISA plan. See id. at 288-89. The ex-wife was the named beneficiary of the SIP. See id. at 289. In rejecting the estate's claim, the Supreme Court explained:

ERISA requires [e]very employee benefit plan [to] be established and maintained pursuant to a written instrument, specify[ing] the basis on which payments are made to and from the plan. The plan administrator is obliged to act in accordance with the documents and instruments governing the plan insofar as such documents and instruments are consistent with the provisions of [Title I] and [Title IV] of [ERISA], and ERISA provides no exemption from this duty when it comes time to pay benefits. . . .
The Estate's claim therefore stands or falls by the terms of the plan, a straightforward rule of hewing to the directives of the plan documents that lets employers establish a uniform administrative scheme, [with] a set of standard procedures to guide processing of claims and disbursement of benefits. The point is that by giving a plan participant a clear set of instructions for making his own instructions clear, ERISA forecloses any justification for enquiries into nice expressions of intent, in favor of the virtues of adhering to an uncomplicated rule: simple administration, avoid[ing] double liability, and ensur[ing] that beneficiaries get what's coming quickly, without the folderol essential under less-certain rules.
The plan provided an easy way for [the decedent] to change the designation, but for whatever reason he did not. The plan provided a way to disclaim an interest in the SIP account, but [the ex-wife] did not purport to follow it. The plan administrator therefore did exactly what [ERISA] required: the documents control, and those name [the ex-wife].

Id. at 300-01, 303-04 (quotation marks and internal citations omitted).

         Based on Kennedy, this Court concluded the following in its summary judgment order:

[I]t is doubtful that the doctrine of substantial compliance remains viable, given the Supreme Court's emphasis on the duty of a plan administrator to act in accordance with the plan documents. The Supreme Court specifically stated that ERISA forecloses any justification for inquiries into expressions of intent that do not comply with the plan documents. See id. at 301. Thus, it appears to this Court ...

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