Court Sides with Participants on ERISA Retaliation Claim

July 19, 2007 ( - The U.S. District Court for the District of Nebraska has ruled in favor of Brentwood Dental Group employees on a claim of retaliation under the Employee Retirement Income Security Act (ERISA), but did not find proof that the employer intended to interfere with their benefits.

According to the opinion, since one employee was terminated and one resigned in lieu of termination, and since these events were in such proximity to the time when the employees raised concerns about Brentwood Dental’s Simple IRA plan administration, it was reasonable to conclude the employer was liable for retaliation. However, there was no proof that the employer intended to interfere with Lisa McKnight’s and Janeil Thompson’s receipt of future benefits though their terminations would result in a lack of benefits eligibility going forward.

The court also found no evidence to prove the plan was due any damages under the plaintiffs’ fiduciary breach claim, the opinion said. Evidence from an investigation into untimely deposits of plan contributions showed plan administrators had already reimbursed the plan for lost interest due to the untimely deposits.

McKnight, the office manager for all three of Brentwood Dental’s offices, had raised concerns with Brentwood’s president and director that deposits of contributions into her retirement fund were not being made in a timely manner. After her initial complaint, a deposit was made.

Later, during a staff meeting held by Brentwood’s practice administrator during the president’s absence. McKnight and Thompson again raised concerns about the retirement plan’s administration. Upon the president’s return, he was informed by the administrator of all concerns raised at the meeting and was told McKnight and Thompson raised their concerns in an inappropriate way.

Soon after, McKnight was terminated for insubordination and Brentwood accepted Thompson’s resignation in lieu of termination.

The case is McKnight v. Brentwood Dental Group Inc., D. Neb., No. 8:04CV642, 7/17/07.