IL Court Allows Suit Against Bowater

September 25, 2006 ( - The US District Court for the Northern District of Illinois has allowed Frank Crosby to pursue an ERISA claim against Bowater Incorporated that was previously dismissed by the 6th US Circuit Court of Appeals.

In denying Bowater’s motion to dismiss the current suit, the court noted that the previous case was not dismissed on its merits, but rather for lack of subject matter jurisdiction. According to the opinion, the court also disagreed with Bowater that Crosby should be judicially estopped since his new claim was inconsistent with his claim in the prior case.

The 6th Circuit dismissed Crosby’s prior suit, saying he was seeking a legal remedy not permitted under the Employee Retirement Income Security Act (ERISA) Section 502(a)(3), which limits plaintiffs to equitable remedies (See US Supreme Court Rebuffs Cash Balance Challenge Appeal ). Crosby’s claim was that he and other similarly situated plan participants were entitled to extra pension money to compensate for what their lump-sum distributions would have been if the plan administrator had not used a pre-retirement mortality discount factor.

In the current suit Crosby asked for relief under ERISA Section 502(a)(1)(B), a claim he had said he could not bring under the prior suit. However, the court determined he should not be judicially estopped from bringing the current suit, despite his change of position, because he did not prevail in the earlier suit.

The case is Crosby v. Bowater Inc. Retirement Plan for Employees of Great Northern Paper Inc., N.D. Ill., No. 05 C 3478, 9/1/06.