First Circuit Upholds Pension Fund’s Termination of Disability Benefits Due to Disqualifying Employment

In Field v. Sheet Metal Workers’ Nat’l Pension Fund, No. 22-1824, __F.4th__, 2023 WL 6418639 (1st Cir. Oct. 3, 2023), Plaintiff-Appellant David Field appealed the district court’s grant of summary judgment in favor of the Sheet Metal Workers’ National Pension Fund (“the Fund”) in his lawsuit for disability pension benefits brought under ERISA Section 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B). The First Circuit Court of Appeals affirmed the decision, finding that the Appeals Committee of the Board of Trustees of the Fund (“Appeals Committee”) did not abuse its discretion when it terminated Field’s disability benefit payments based on its finding that he had engaged in “Disqualifying Employment,” a term defined in the governing plan document.

The plan document defines “Disqualifying Employment” as “(A) employment with any Contributing Employer; (B) employment with any employer in the same or related business as any Contributing Employer; (C) self-employment in the same or related business as a Contributing Employer; (D) employment or self-employment in any business which is under the jurisdiction of the Union; or (E) employment in the Sheet Metal Industry that is not covered by a collective bargaining agreement between the Union and the employer.” The plan is clear that disability benefits are terminated if one engages in Disqualifying Employment.

Field was receiving a disability pension due to disability caused by electrocution, herniated discs, and Crohn’s disease. The Fund terminated his benefits when it came upon information that Field held a Home Improvement Contractor license in the Commonwealth of Massachusetts and owned David Field Construction, a company “advertised as a general contractor.” The Fund also verified that he was responsible for four construction projects in the years 2008, 2010, and 2016. Field claimed that while he did maintain licenses, the work done in 2008 and 2010 was performed by a different person and the work done in 2016 was done by someone else, Juan Quishpilema, who used Field’s license number without his permission. Field submitted a letter from Quishpilema stating that he used Field’s license without his permission. The Fund sought additional details from Field and Quispilema but they did not respond to the Fund’s inquiries. The Committee denied Field’s appeal because it found that he did not provide credible documentation to support his claim that his Construction Supervisor license was twice used fraudulently and Field’s failure to provide documentation created an adverse inference that he used the license or consented to its use.

Field filed suit and claimed that the Fund did not engage with the evidence in a meaningful way or generate any evidence supporting its claim that he performed Disqualifying Employment. The court found that the Fund did not abuse its discretion or act arbitrarily and capriciously when it considered the Quishpilema statement. The statement was undated, unnotarized, and not written on any company letterhead. When the Fund wrote to Quishpilema to obtain more information, he did not respond. It was also Field’s responsibility to provide any information or proof requested by the Fund. He failed to do so. The court upheld the “well-reasoned decision” of the district court and awarded costs to the Fund.