In December, a group of actors led by Ed Asner sued the SAG-AFTRA Health Fund and its board of directors for breach of fiduciary duty and violation of the Employee Retirement Income Security Act (ERISA ).
The SAG-AFTRA Health Fund is asking a California federal judge to dismiss a lawsuit brought by some of its members over recent changes to the insurance plan.
In December, a group of actors led by Ed Asner sued the SAG-AFTRA Health Fund and its board of directors for breach of fiduciary duty and violation of the Employee Retirement Income Security Act (ERISA ). Their lawsuit claims premiums have skyrocketed and medical coverage is being taken away from elderly guild members under the guise of COVID-19-related restructuring. They allege that the changes really stem from the poorly executed merger in 2017 of the SAG and AFTRA health plans and that union negotiators were kept in the dark about the plan’s precarious financial situation.
The health fund filed a motion on Tuesday to dismiss the complaint, arguing that the role of the plan and the trustees is that of a settlor, not a trustee.
“It is well established that plan sponsors do not act as trustees when making decisions regarding the structure or design of the plan, including as challenged here decisions to merge the plans and amend the plan to. provide less generous benefits, ”writes attorney Myron Rumeld in the motion, which is posted below. “Therefore, these types of decisions cannot be challenged under ERISA’s fiduciary liability provisions. … Plaintiffs also have no valid remedy for fiduciary breach based on the Trustees’ decision. of SAG-AFTRA to modify the plan in order to modify the eligibility conditions for benefits. “
Further, he argues that there is no affirmative responsibility under ERISA to disclose information to union negotiators and, even if there was, it is “absurd” to argue that the act of not sharing the plan’s finances prevented the union from negotiating higher employer contributions.
“Among other things, it ignores the implausibility inherent in the idea that union negotiators could somehow have persuaded employers to increase their dues enough to make up for the projected deficits of $ 141 million and $ 83 million respectively in 2020 and 2021, when the television and theater employers had already agreed to “up to $ 54 million,” an amount the union saw as “transformative,” “Rumfeld writes. “It also ignores the simple fact that, since the overwhelming majority of union members receive no benefit from the plan, the union should have reduced wages or compromised pay increases or other contractual terms for all members in the plan. aim to generate higher contributions to the plan for the minority of eligible plan members. “
The health plan also argues that a claim for breach of fiduciary duty under ERISA is not the way to deal with a claim of age discrimination and that age claims fail. separately because the relevant plan changes were based on “retiree and retirement status” and not on age. .
A hearing is currently set for May 3.
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