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Bishop v. Lucent Technologies

March 15, 2007

VIRGINIA BISHOP, ET AL. PLAINTIFFS,
v.
LUCENT TECHNOLOGIES, INC., ET AL. DEFENDANTS.



The opinion of the court was delivered by: Judge Algenon L. Marbley

Magistrate Judge Kemp

OPINION AND ORDER

I. INTRODUCTION

This matter comes before the Court on a combined Motion to Dismiss filed by Defendants Lucent Technologies, Inc. ("Lucent" or "the Company") and the Lucent Retirement Income Plan (collectively, "Defendants"). For the reasons set forth herein, the Court GRANTS Defendants' Motion to Dismiss.

II. BACKGROUND

A. Facts

Because the matter before the Court is Defendants' Motion to Dismiss, the Court will consider the facts in the light most favorable to Plaintiffs. McGee v. Simon & Schuster, Inc., 154 F. Supp. 2d 1308, 1310 (S.D. Ohio 2001).

On June 11, 2001, Lucent announced its 2001 Voluntary Retirement Program ("2001 VRP"), more commonly known at Lucent as the 5 5 Plan (the "Plan"). The Plan granted eligible employees who voluntarily retired during a particular time period an additional five years of service and an additional five years of age in calculating their pension eligibility and determining whether an early retirement discount would apply to their benefits.

Virginia Bishop ("Bishop"), Gerald Deckard ("Deckard"), Charles Himmelspach, Jr. ("Himmelspach"), James Kastet ("Kastet"), Janet Koch ("Koch"), George Policello ("Policello"), Karen Staff ("Staff"), and Sharon Stratton ("Stratton") (collectively, "Plaintiffs") all retired or separated from their service at Lucent prior to Lucent's announcement of the 2001 VRP on June 11, 2001. Plaintiffs explained that all Lucent employees had been notified that if they chose to retire on or before December 31, 2000, Lucent would contribute ninety percent (90%) of the "maximum company contribution" towards retiree health care coverage regardless of the employee's years of service. A decision to retire on or before December 31, 2000 would, therefore, "lock in" Lucent's commitment to the retirees' health benefits.

Bishop, Deckard, Himmelspach, Koch, Policello, and Staff all allege that they spoke with Lucent management or Lucent human resources employees prior to their decision to retire in 2000. Each was led to believe that Lucent would not offer a different retirement incentive package in the near future. Bishop, Deckard, Kastet, Koch, Policello, and Staff also contend that they were told that if they did not retire prior to December 31, 2000, they could lose their health benefits. Believing that no retirement incentive package would be offered in the future, Bishop, Deckard, Himmelspach, Kastet, Koch, Policello, and Staff all retired on or before December 31, 2000.

Stratton, on the other hand, retired from Lucent on June 28, 2001, after the 2001 VRP was announced. Stratton was told that she was ineligible for the 2001 VRP, however, because she had volunteered to be severed from Lucent in April 2001 under the Force Management Program ("FMP"), a severance program used by Lucent during periods of layoffs. Prior to her decision to volunteer for the FMP, Stratton alleges that she was told by Lucent officials that future retirement incentive packages would not be offered. She contends that she made her decision to enter the FMP based on the information that Lucent would not offer a future retirement incentive package.

Each Plaintiff alleges that Lucent assured them that a retirement incentive package would not be offered in the near future. Each Plaintiff also contends that had they known a future retirement package was remotely possible, each would have delayed retirement and would have accepted the 2001 VRP offer.

Lucent alleges that it assembled the June 2001 VRP on short notice, after several months of declining business, and on the heels of the termination of merger discussions that the Company had pursued. Lucent contends that it did not breach its fiduciary duty to Plaintiffs because the ...


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