July 14, 2025
AT&T must face a proposed class action claiming it miscalculated married couples’ pension benefits, a California federal judge ruled, saying workers leading the suit provided evidence that the telecommunications company’s use of decades-old mortality data and interest rates was unreasonable.
U.S. District Judge James Donato largely denied AT&T Inc.’s motion for summary judgment on current and former workers’ Employee Retirement Income Security Act claims, ruling Wednesday there were material disputes about what a reasonable actuary would consider acceptable assumptions when determining the “actuarial equivalence” of retirement benefits.
The workers alleged in their October 2020 lawsuit that although federal law requires that joint survivor annuities be the same or higher value than single life annuity benefits, AT&T used factors that haven’t been updated in nearly 40 years to convert the single life annuities to joint survivor annuities. In June 2022, the workers asked the court to certify two classes containing nearly 300,000 people, and that motion is still pending.
In its motion for summary judgment, AT&T argued that ERISA doesn’t require “reasonable” or “up-to-date” assumptions when calculating benefits, and that “actuarial equivalence is viewed as a range” that can be accomplished in various ways.
But Judge Donato said that while ERISA doesn’t define the term, “it does not take a leap of faith to conclude that ‘actuarial equivalence’ would be understood by an actuary skilled in the art to connote the necessity of using reasonable assumptions.”
The judge noted that the workers’ actuarial expert, Ian Altman, stated that he advises his pension plan clients that actuarial equivalence factors must, at a minimum, reflect current financial market conditions and demographic expectations.
“A reasonable factfinder could conclude that the plan’s conversion factors, and the assumptions on which those factors are based, would not be considered ‘reasonable’ by an actuary exercising his or her professional judgment,” Judge Donato wrote.
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Michelle Yau, who is representing the workers, told Law360 they’re looking forward to the upcoming trial.
“We wholeheartedly agree with court that Mr. ‘Altman’s opinions are grounded in evidence and sound actuarial methods’ and that AT&T is ‘not seeing the forest through the trees’ when it comes to our clients’ claims,” Yau said.
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The workers are represented by Kai Richter, Michelle C. Yau, Daniel R. Sutter and Caroline E. Bressman of Cohen Milstein Sellers & Toll PLLC, Peter K. Stris, Victor O’Connell, John Stokes, Colleen R. Smith and Rachana A. Pathak of Stris & Maher LLP, Shaun P. Martin of the University of San Diego School of Law, and Todd Jackson and Nina Wasow of Feinberg Jackson Worthman & Wasow LLP.
Read AT&T Can’t Escape Suit Over Pension Plan’s Mortality Data.