A federal district court in New Jersey held that oral misrepresentations may support a breach of fiduciary duty claim under ERISA. Plaintiff Richard Lees was hired by American Re–Insurance Company, although he was paid by another entity called SMS. When American sought to transfer Lees to its payroll, Lees allegedly agreed to the transfer only if he would be treated as if he had been on American’s payroll the entire time for the purpose of his pension benefits. According to Lees, he was promised these benefits instead of receiving a sign-on bonus. Lees alleged that over a decade after his transfer, the successor to American, Munich, informed him that he would not receive pension credit for the time he was on SMS’s payroll. According to the district court, nothing in Third Circuit precedent precludes oral misrepresentations from supporting a breach of fiduciary duty claim under ERISA. The court added that even if the oral representations could not support Lees’ breach of fiduciary duty claim under ERISA, Lees had alleged sufficient facts on which to base his claim and further discovery into his employee file could reveal written materials to support the claim. The court thus denied defendant’s motion to dismiss. The case is Lees v. Munich Reinsurance Am., Inc., No. 14–2532, 2015 WL 1021299 (D.N.J. Mar. 9, 2015).
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