U.S. Supreme Court Denies Hearing Promised Benefits Suit

October 7, 2008 (PLANSPONSOR.com) - The U.S. Supreme Court has denied a request to hear the case of two former Quaker Oats Co. employees fighting to receive additional pension benefits they say were promised by Quaker.

In making its October 6 decision, the high court let stand a ruling by the 7th U.S. Circuit Court of Appeals that representations made to the employees were innocent mistakes and that anything told to them orally did not carry the same weight as what the court said were clear plan documents (See Benefits Challenge Denied – Again ).

Geri Kannapien and Janice Rozhon worked for Golden Grain when it was acquired by Quaker in 1986. A 2001 merger with a subsidiary of PepsiCo amended the Quaker Retirement Plan to provide that benefits would be calculated using an employee’s “credited service” – not including any time the employee served prior to participating in the Quaker plan.

The former employees received statements of their estimated pension benefits, which incorrectly used their dates of hire as the starting point for their credited service. However, the date on which they began participating in the retirement plan was used to calculate their actual benefit amounts.

The Supreme Court’s refusal to hear the case also let stand the lower court’s dismissal of Kannapien and Rozhon’s fiduciary breach claims. The court said the former employees did not list any plan fiduciaries as plaintiffs in the case.