Given the transfer of pension assets was governed by the USEC Privatization Act of 1996, the retirees’ lawsuit filed in 2004 occurred past the four-year “catch-all” statute of limitations under the US Code, according to the appellate court’s opinion. The USEC Privatization Act did not include a statute of limitations provision.
Even if the Act did not put the retirees on notice of the amount of assets that would be transferred to the USEC plan, a plan amendment, effective May 18, 1999, should have put the retirees on notice of their potential claim, USEC asserted, according to the opinion. The amendment stated that assets equal to the accrued benefit for each participant in the Lockheed Martin Energy Systems defined benefit plan would be transferred to the USEC plan and “no other assets or liabilities shall be transferred to the USEC Plan from the [old] Plan.”
The retirees worked at the Paducah Gas Diffusion Plant (PGDP) and were participants in the pension plans created for PGDP employees. According to the court document, PGDP was operated by various private contractors on behalf of the Department of Energy, including Lockheed Martin Utilities Services. Congress created USEC to run the plant as part of the Energy Policy Act of 1992 and later enacted the USEC Privatization Act in 1996 to clarify the manner and means by which USEC would be privatized.
At the time of the creation of USEC, Lockheed Martin Utility Systems Inc. served as the operating contractor of PGDP, and Lockheed employees participated in a pension plan maintained by Lockheed Martin Energy Systems. USEC initiated a transfer of more than $548 million of pension assets via an agreement between Lockheed and USEC on May 24, 2000. At the time of the agreement, a surplus of funds existed in the pension plan above the amount necessary to cover the vested benefits of plan participants.
The retirees filed their lawsuit on June 29, 2004, against the Department of Energy, Lockheed and USEC, alleging violations of the Privatization Act and the breach of various fiduciary duties under the Employee Retirement Income Security Act (ERISA).They filed the lawsuit following the final transfer of assets to the USEC plan, but, according to the opinion, the district court determined: “Plaintiffs’ contention that their claim accrued on June 30, 2000 is not consistent with Sixth Circuit case law which focuses on the date of an event which should have alerted the typical lay person to protect his or her rights. The Plaintiffs’ decision to wait until the date of the final installment prior to filing suit is identical to the decision of the medical student in Roberson, who decided to wait out the appeals process rather than filing a civil rights suit at the point at which a reasonable person would have acted to protect his or her rights.”
The opinion in Edwards v. US Department of Energy is here .