## Facts

- Stacey Schuett and Lesly Taboada-Hall were in a committed same-sex relationship for more than 27 years.
- Taboada-Hall worked for FedEx Corporation for about 26 years and participated in the FedEx Corporation Employees’ Pension Plan, an ERISA-governed defined-benefit plan.
- The plan provided a mandatory survivor annuity (including a qualified preretirement survivor annuity) payable to a vested participant’s “surviving spouse” if the participant died before retirement.
- The plan defined “spouse” by cross-reference to federal law, which (at the time relevant to the plan’s administration) incorporated DOMA’s opposite-sex definition of “spouse.”
- In February 2010, Taboada-Hall was diagnosed with cancer, and on June 3, 2013, she was told it was terminal.
- On June 13, 2013, FedEx personnel told Schuett and Taboada-Hall that Schuett would not qualify for the plan’s surviving-spouse benefit because the plan recognized only opposite-sex spouses under its federal-law definition.
- On June 19, 2013, Schuett and Taboada-Hall went through a marriage ceremony; Taboada-Hall died on June 20, 2013.
- On June 26, 2013, the Supreme Court decided *United States v. Windsor*, invalidating DOMA’s federal definition of marriage and spouse; soon after, the Ninth Circuit lifted the stay that had kept California’s Proposition 8 litigation from taking effect, and California resumed issuing marriage licenses to same-sex couples.
- On September 18, 2013, a California superior court, at Schuett’s request, issued an order declaring the marriage occurred on June 19, 2013 and issued a delayed marriage certificate reflecting that date.
- Schuett applied for survivor benefits under the plan; FedEx denied the claim and maintained on appeal that Taboada-Hall was not legally married at death and, even if she was, Schuett did not meet the plan’s definition of “spouse” at the relevant time.
- Schuett sued FedEx, the FedEx Corporation Retirement Appeals Committee, and the plan under ERISA § 502(a)(1)(B) (benefits) and § 502(a)(3) (equitable relief for breach of fiduciary duty), among other theories; defendants moved for judgment on the pleadings under Rule 12(c).

## Issues

1. Whether Schuett plausibly stated an ERISA § 502(a)(1)(B) claim that the plan administrator abused its discretion in denying a surviving-spouse annuity under the plan’s definition of “spouse.”
2. Whether Schuett plausibly alleged that she and Taboada-Hall were legally married under California law at the time of Taboada-Hall’s death, given the Proposition 8 timeline and the later state-court order and delayed marriage certificate.
3. Whether Schuett plausibly stated ERISA § 502(a)(3) claims for breach of fiduciary duty based on alleged (a) misleading statements about eligibility for survivor benefits and (b) continued administration of the plan using a DOMA-based definition after *Windsor*.
4. Whether Schuett had ERISA standing as a “beneficiary” based on a colorable claim to survivor benefits.

## Decision

- The court granted the Rule 12(c) motion in part, dismissing the § 502(a)(1)(B) benefits claim to the extent it rested on an alleged abuse of discretion in the administrator’s interpretation and application of the plan’s “spouse” definition.
- The court denied the motion in part, holding that Schuett plausibly alleged she and Taboada-Hall were legally married under California law at the time of death (at least for pleading-stage purposes).
- The court denied the motion in part as to § 502(a)(3), allowing fiduciary-duty claims to proceed based on allegations that defendants misled the participant and/or administered the plan in a manner inconsistent with controlling federal law after *Windsor*.
- The court rejected the standing challenge at the pleading stage, finding Schuett alleged a colorable claim to benefits.

## Legal Principles

- A Rule 12(c) motion uses the same standard as Rule 12(b)(6): the court accepts well-pleaded facts as true and asks whether the complaint states a plausible claim for relief.
- When a plan grants discretionary authority, an ERISA § 502(a)(1)(B) plaintiff must plausibly plead facts showing the denial was an abuse of discretion (arbitrary and capricious).
- ERISA requires qualifying pension plans to provide statutory survivor annuities to a participant’s “surviving spouse” when plan and statutory conditions are met.
- ERISA fiduciaries must follow plan documents only insofar as those documents are consistent with ERISA and other controlling law. 29 U.S.C. § 1104(a)(1)(D).
- Fiduciaries may breach duties by making materially misleading statements or providing incomplete or inconsistent information about plan benefits when communicating with participants and beneficiaries.
- ERISA § 502(a)(3) authorizes equitable remedies for fiduciary breaches (such as reformation or surcharge) and may remain available even when a plaintiff’s benefits-due theory under § 502(a)(1)(B) is limited or dismissed at the pleading stage.
- A plaintiff has ERISA standing as a “beneficiary” when she pleads a colorable claim to benefits under the plan.

## Conclusion

In *Schuett v. FedEx Corporation*, the district court granted defendants’ judgment-on-the-pleadings motion only in part, dismissing the benefits-due claim to the extent it depended on showing the plan administrator unreasonably interpreted the plan’s DOMA-linked “spouse” definition, but permitting Schuett to proceed on fiduciary-duty and equitable-relief theories based on alleged misleading communications and continued reliance on a same-sex-spouse exclusion after *Windsor*, while also finding she had standing based on a plausible claim to survivor benefits.


Schuett v. FedEx Corporation, 119 F. Supp. 3d 1155 (2016)