Amara v. Cigna Corp.

          RULING ON PLAINTIFFS' MOTION TO ENFORCE COURT RULINGS AND FOR SANCTIONS

          Janet Bond Arterton, U.S.D.J.

         Plaintiffs move "that this Court grant their motion to enforce the Court's reformation and methodology rulings and sanction Cigna for calculating and paying individual remedy amounts under ... interpretations ... of this Court's orders that fail to comply with the Court's rulings." (Pis.' Mot. to Enforce Court Rulings and for Sanctions [Doc. # 571] at 1.) For the reasons set forth below, Plaintiffs' Motion is granted in part and denied in part.

         I. Background

         The Court assumes the parties' familiarity with this case's background and history. A summary of the case's history through January 10, 2017 can be found in the Court's Revised Ruling on Proposed Methodology and Request for Order of Compliance Plan, issued on that date. ([Doc. # 486] at 2-5.) On July 14, 2017, the Court granted Cigna's motion for clarification of the January 2017 order. ([Doc. # 507].) On November 7, 2017, the Court denied Plaintiffs' subsequent motion for reconsideration. ([Doc. #517].)

         On October 17, 2018, after briefing by the parties, the Court adopted Plaintiffs' proposed interest rate and age assumption methodologies for the purpose of calculating the net present value of the remedy award and calculating the attorneys' fees to which Plaintiffs might be entitled. The Court also directed Defendants to provide the Court with an updated net present value calculation. ([Doc. # 550].) After further briefing by the parties, the Court on November 29, 2018 granted Plaintiffs' Motion for Attorneys' Fees in substantial part and directed Defendants to begin implementing the A remedy as quickly as possible, setting a schedule for the payment of past-due lump sums and back benefits. ([Doc. # 555] at 11.) After Defendants' subsequent motion for clarification, the Court ordered Defendants to pay small benefit cashouts on the same schedule. ([Doc. #560] at 1-2.)

         On April 5, 2019, Plaintiffs filed the instant Motion, asserting that "Cigna has violated the Court's rulings by:

(1) Using "lookback" interest rates from the date of the Part B lump sum distributions rather than from the Part A "Benefit Commencement Dates" to annuitize the offsets that this Court has allowed Cigna to take;

(2) Using "outdated" mortality tables from the date of the Part B lump sum distributions rather than the "successor" mortality tables applicable under the plan provisions on the "Applicable Mortality Table" to annuitize the offsets that this Court has allowed Cigna to take;

(3) Eliminating early retirement benefits until the "later of the Part A early retirement age or the date the Part B cash balance account is distributed; and

(4) Refusing to pay "small benefit cashouts" to class members who have not received their Part B cash balance accounts.

(Pis.' Mot. to Enforce Court Rulings and for Sanctions at 1-2.) The Court addresses each of these issues in turn...

         II. Interest Rates and Mortality Tables

         This Court previously addressed Plaintiffs' objection to "Defendants' [proposed] methodology for converting the already-paid lump sums into annuities for purposes of offsetting A B." (Revised Ruling on Proposed Methodology and Request for Order of Compliance Plan at 16.) Cigna had stated that when "'annuitizing the Part B benefits, ... [it] will use the mortality tables and interest rates actually in effect under the terms of Part B as of the later of the date the participant reaches earliest retirement age under the terms of Part A or the participant's actual benefit commencement date.'" (Id. (alterations in original).) The Court ruled "that the plan provisions in place at the time the lump sum was received should control... and not, as Cigna argues, the plan in place at the later of the date the participant reaches earliest retirement age under Part A or the actual benefit commencement date." (Id. at 17 (emphasis in original).)

         The parties now dispute, in essence, the year(s) to be used to determine the interest rate and mortality table for calculating the annuity value of the lump sum distribution for purposes of determining the offset. (See Ruling on Methodology for Calculating ...