Northwest Airlines, Inc., et al. v. Phillips, et al., No. 11-1730 (8th Cir. 2012)
Annotate this CaseNorthwest and the Pilots Association filed a complaint seeking a declaratory judgment that their post-bankruptcy retirement benefit plan (MP3) complied with the Employment Retirement Income Security Act (ERISA), 29 U.S.C. 1001-1461. Appellants (older Pilots) counterclaimed arguing that the MP3 retirement benefit plan violated ERISA, the Age Discrimination in Employment Act (ADEA), 29 U.S.C. 621-634, and several state laws prohibiting age discrimination. Under the MP3, the contributions of all of the pilots were based on their protected final average earnings, which could not be calculated without the use of age. However, that did not mean that the older Pilots' contributions have been reduced because of their age. There were several factors in the MP3 that could reduce an older pilots' projected final average earnings. While promotions and pay increases were correlated with age, they were analytically distinct and therefore not reductions in contributions because of age. Service ration and the frozen Pension Plan offset also both contributed to potential differences in contribution. Finally, the court rejected older Pilots' argument that the district court improperly disregarded the declaration of their expert witness. Therefore, the court held that the MP3 did not reduce the older Pilots' benefits because of age and therefore affirmed the judgment of the district court.
Court Description: Civil Case - ERISA. District court rejection of claim by older Northwest pilots that retirement plan (MP3) illegally reduces or eliminates their retirement benefit payments because of their age is affirmed. Promotions and pay increases are correlated with age but are not reductions in contributions because of age and neither are reductions due to service ration and offets. District court did not reject expert's declaration and on summary judgment this court reviews the record anew.
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