Fifth Circuit Reaffirms that Termination of ERISA Plan Is a Settlor Function, Not A Fiduciary Act

In Jackson v. AT&T Ret. Sav. Plan, No. 20-30255, __F.App’x__, 2021 WL 3624751 (5th Cir. Aug. 16, 2021), pro se Plaintiff-Appellant, Samantha J. Jackson, appealed the dismissal of her ERISA claim based on Defendants AT&T Inc., the AT&T Retirement Savings Plan (“Savings Plan”), the Mobility Program of the AT&T Pension Benefit Plan, AT&T Services, AT&T Mobility Services L.L.C. (“AT&T Mobility”), and Fidelity Workplace Services, L.L.C. alleged breaches of fiduciary duty which led to their reduced contributions to the Savings Plan, in which Jackson is a participant. As the court explained:

“This occurred as a result of Cingular Wireless being merged with and converted to AT&T Mobility, which led to Cingular’s ERISA plan being replaced by the Savings Plan. Primarily, Jackson complained that the Defendants improperly classified certain forms of compensation in a way that reduced their contributions to the Savings Plan. She also asserted that the Defendants improperly delayed crediting contributions to the Savings Plan and that a merger document was invalid.”

The Ninth Circuit agreed with the district court that Jackson failed to state an ERISA claim because the actions Jackson complains about were employer acts or settlor functions, not fiduciary acts. The court explained that it is settled that when an employer decides to terminate or amend a plan, it does not act as a fiduciary and cannot violate its fiduciary duty provided that any reduced or eliminated benefits are not accrued or vested at the time.