Summary of the Lawsuit

This lawsuit alleges that the non-profit healthcare system Ascension Health Alliance and its subsidiaries (“Ascension”) improperly claim that their pension plans qualify as “Church Plans” under the Employee Retirement Income Security Act (“ERISA”). In operating its plans as “Church Plans,” Ascension does not comply with many protections afforded to pension beneficiaries under ERISA.  The lawsuit seeks to compel Ascension’s pension plans to fully comply with ERISA.

Summary of the Claims

The Complaint alleges that Ascension is violating numerous provisions of ERISA, while wrongfully claiming that the Ascension Plans are exempt from ERISA’s protections because they are “Church Plans.” The Complaint alleges that the Ascension Plans are not “Church Plans” because Ascension is not a church or a convention or association of churches, and because none of the Ascension Plans were established by a church or a convention or association of churches. The Complaint further alleges that Defendants breached their duties under ERISA by, among other things:

  • underfunding the Ascension Plans by over $444.5 million;
  • freezing the accrual of pension benefits for participants in the Ascension Plans effective January 1, 2013; and
  • failing to give 45 days’ notice (as required by ERISA) of this reduction in future benefits to Plaintiff or any member of the class.

Class Action

This lawsuit is brought on behalf of the following persons:

All participants or beneficiaries of any Ascension Plans operated as or claimed by Ascension to be Church Plans as of the date of the filing of this Complaint. Excluded from the Class are any high-level executives at Ascension Health or Ascension Health Alliance or any employees who have responsibility or involvement in the administration of the Plan, or who are subsequently determined to be fiduciaries of one or more of the Ascension Plans, including the Individual Defendants.

Status of the Litigation

Plaintiff filed her Complaint on March 28, 2013 in the United States District Court for the Eastern District of Michigan. On June 28, 2013, Defendants moved to dismiss the Complaint.  On August 1, 2013, Plaintiffs filed their opposition to Defendants’ motion to dismiss.  On August 15, 2013, Defendants filed their reply in support of the Motion to Dismiss. Oral arguments for the Motion were held on November 19, 2013. On May 9, 2014, the Court granted Defendants’ Motion to Dismiss the Complaint. Plaintiffs filed a Notice of Appeal to the United States Court of Appeals for the 6th Circuit on June 6, 2014.  The parties are current briefing the appeal; oral argument on the appeal has not yet been scheduled. 

Settlement

A Settlement was finally approved by the Court on on September 17, 2015 and because no appeal was filed, the Settlement terms are final.  The settlement affords participants ERISA key ERISA protections for the next seven and a half years (commencing January 1, 2015 through June 30, 2022). Ascension has also agreed to provide certain equitable benefits as well as additional funding to the pension plan.

Whom to Contact for More Information

For more information on the settlement agreement, please visit the following website:

KellerSettlements.com

If you believe you have questions regarding this case or the Settlement, please contact one of the following persons:

Karen L. Handorf, Esq.: khandorf@cohenmilstein.com
Michelle C. Yau, Esq.:  myau@cohenmilstein.com
Maria Dewees, Paralegal mdewees@cohenmilstein.com
Cohen Milstein Sellers & Toll PLLC
1100 New York Avenue, N.W., Suite 500
Washington, D.C. 20005 
Telephone: 888-240-0775 or 202-408-4600