Plan Distribution Suit Dismissed on Technical Grounds

October 12, 2004 ( - A California federal court judge has thrown out a lawsuit by the domestic partner of a dead participant in the Charles Schwab & Co. retirement plan to recover nearly $500,000 the plaintiff said was still owed him as the dead man's beneficiary.

>US Judge Charles Breyer of the US District Court for the Northern District of California ruled that plaintiff Louis Goeres’ lawsuit against Schwab under the Employee Retirement Income Security Act (ERISA) couldn’t proceed because Goeres was trying to pursue a legal claim under a statute only permitting “equitable” complaints.

>On that technical legal point, Breyer dismissed Goeres’ claims that he was shortchanged in the payout he received from his dead domestic partner’s retirement plan because Schwab told Goeres he wasn’t a beneficiary. Goeres has alleged that constituted an ERISA fiduciary breach.

>According to the court, at around the time of the death of Goeres’ partner Stephen Ward’s, Ward’s retirement account was valued at approximately $1.2 million. On June 30, 2000, the account was valued at approximately $1.6 million. When the plan paid out the benefits to Goeres in 2004, the account had dropped in value to approximately $565,000.

>Schwab’s failure to promptly notify Goeres that he was Ward’s plan beneficiary coupled with a drop in the stock market led to a loss of about $500,000 Goeres claimed was rightfully his.

>The case is Goeres v. Charles Schwab & Co., N.D. Cal., No. C 04-01917 CRB, 9/28/04.