In the case of Gruber v. PPL Retirement Plan, the 3rd U.S. Circuit Court of Appeals vacated an earlier ruling by the U.S. District Court for the Eastern District of Pennsylvania and found in favor of the plaintiff.
The 3rd Circuit found the subsidy "only benefited a class of participants who were
eligible for early retirement …Therefore, contrary to PPL's assertion
and the District Court's conclusion, this benefit was an employer
subsidy for early retirement." The court pointed out that "PPL itself
initially treated the GP 401 benefit as a subsidy for early retirement." The District Court and PPL claimed that the subsidy was provided due to a reduction in force.
The plaintiff's husband was a participant of the PPL Retirement Plan and worked at PPL Corporation till 2009. The plaintiff and her husband were divorced in 2005. Part of their divorce settlement included a QDRO, which entitled the plaintiff to a portion of her husband's pension benefits under the retirement plan. The plan administrator approved the QDRO, stipulating that the plaintiff would receive "the actuarial equivalent of 53% of the present value of the participant's accrued benefit in the plan." Also stipulated was that if the plaintiff's husband retired before age 65, the amount payable to the plaintiff would "be recalculated to include 53% of the value of any employer subsidy for early retirement."