The 8th U.S. Circuit Court of Appeals has agreed with a lower court that participants in the Anheuser-Busch salaried employee pension plan are entitled to enhanced pension benefits under Section 19.11(f) of the plan, but disagreed with the lower court that no calculation of benefits due was necessary.
According to the appellate court’s opinion, Section 19.11(f) of the Anheuser-Busch Companies Pension Plan provides for an enhanced pension benefit for a plan participant “whose employment with the Controlled Group is involuntarily terminated within three (3) years after the Change in Control.” It does so by adding “an additional five (5) years” to the participant’s “Credited Service” for purposes of calculating the participant’s benefits.
In November 2008, Anheuser-Busch InBev, N.V. combined the Anheuser-Busch Companies. The parties in the case agree the transaction resulted in a “change of control” under the plan. As a subsidiary, BEC was a member of the Anheuser-Busch family of Companies, defined under the plan as the “controlled group.” At some point in the following year, InBev announced it was selling BEC to Blackstone Capital Partners V.L.P., to be finalized on December 1, 2009.
In September 2012, participants in the plan brought claims to Anheuser-Busch for enhanced pension benefits. They contended a change in control occurred when InBev combined Anheuser-Busch Companies, that they were involuntarily terminated from employment with the controlled group when InBev sold BEC, and that they were entitled to enhanced benefits under Section 19.11(f) of the plan.
The Anheuser-Busch retirement plan administrator denied the claims. The plan administrator stated the “purpose for the special benefits under Section 19.11(f) is to provide additional benefits to individuals who are out of work after they involuntarily lose their employment within three years after a change in control of Anheuser-Busch Companies.” According to the plan administrator, eligibility for enhanced benefits under Section 19.11(f) required “an actual break in an individual’s employment, rather than simply a change in the owner of the entity employing the individual during a period of continuous employment.” Plaintiffs appealed the denials of benefits to the Pension Plans Appeals Committee, which upheld the decisions. They then filed a class action lawsuit to obtain enhanced benefits under the plan. NEXT: Was the district court’s decision final?