Monday, September 24, 2007
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Court: NFL Player Not Misled Into Settling Retirement Claim
By KENNETH OFGANG, Staff Writer
National Football League retirement plan officials did not breach their fiduciary duties to a former player when they settled his disability claim without telling him about an appellate court ruling that would have made the claim worth much more money, the Ninth U.S. Circuit Court of Appeals ruled Friday.
In a ruling issued just days after a congressional hearing on complaints by ex-players and family members who say the retirement plan refuses to pay legitimate claims to old-time players who helped make the league the multibillion dollar business it is today, the panel reversed a U.S. district judge’s decision in favor of Victor Washington.
Washington—a running back and kick returner who played briefly at the University of Wyoming and later in the Canadian Football League before being selected in the 1970 NFL draft—was selected for the Pro Bowl game, which showcases the league’s best players, following his 1971 rookie campaign with the San Francisco 49ers. But subsequent knee, shoulder, back, and elbow injuries ended his career after five seasons.
Washington, now 60, has been fighting with the league over disability benefits since 1983. Doctors agreed that he was totally and permanently disabled, in part due to depression from constant pain, but the league said he had a “non-football” disability, for which the benefits are much lower than if the disability were found to result from his activities as a player in the league.
Under the plan then in effect, a non-football disability could result in a benefit of as little as $750 per month, while those with disabilities resulting from their football careers were entitled to at least $4,000 monthly.
After the retirement board—which is made up of an equal number of representatives of the players union and the league’s management—deadlocked, Washington’s case went to an arbitrator, who ruled that he did not qualify for football-related benefits.
The arbitrator, who issued similar rulings in a number of other cases, reasoned that because the plan referred to disability from “a” football injury, players such as Washington whose disabilities may have been the product of multiple injuries, no one of which would have left the player disabled, were only entitled to “non-football” benefits.
In 1993, however, another ex-player, Donald Brumm, won an Eighth Circuit ruling that the arbitrator’s interpretation was unreasonable because the plan language was intended to draw a distinction between treatment of football and non-football injuries, not between a single injury and multiple or cumulative injuries.
Subsequent to that ruling, the league and the players negotiated a new collective bargaining agreement with a new retirement plan. Under the new plan, a player who suffers an “active football,” “active nonfootball,” or “football degenerative” disability gets at least $4,000 per month, and in some cases a supplemental benefit, while players with “inactive” disability status get at least $1,500 per month.
To quality for football degenerative disability benefits, a former player must become permanently disabled as a result of “League football activities” within 12 years of retirement, or by age 45, whichever is later.
In 1996, Washington requested a reclassification as having a football degenerative disability under the new plan. The retirement board turned him down, but after protracted negotiations, a settlement agreement was reached in which Washington accepted a $400,000 lump sum in lieu of retroactive benefits at the higher rate but agreed that his subsequent benefits would remain at the “inactive” level.
In 2004, after losing yet another bid to persuade the board to award him higher benefits, Washington filed suit in the U.S. District Court for the District of Arizona alleging that he had only recently learned about the Brumm decision and that he would not have settled had he been told that the reasoning used to deny him the higher level of benefits had been rejected by the court.
U.S. District Judge Neil V. Wake agreed and ordered the retirement board to reconsider the 1996 claim for reclassification.
But Judge Pamela Ann Rymer, writing Friday for the Ninth Circuit, said the Brumm decision was irrelevant because it had nothing to do with the definition of “League football activities” under the 1993 CBA.
Rymer explained:
“We cannot see how the holding in Brumm would inform the decision-making process of a reasonable participant in Washington’s position, pursuing a request to upgrade benefits from Inactive to Football Degenerative under the new Plan, contemplating settlement of such a request, or assessing the costs and benefits of litigating denial of that request.”
The old and new plans were so dissimilar in their classifications, the judge elaborated, that “knowing what Brumm had to say about the meaning of the phrase, ‘a football injury,’ would not be helpful to a participant, to a plan administrator, or to a court in arriving at a reasonable construction of ‘League football activities.’”
Senior Judge Procter Hug Jr. concurred in the opinion, but Judge Raymond C. Fisher dissented.
“I disagree with the majority’s conclusion that ignorance of Brumm was not substantially likely to have misled a reasonable employee in making ‘an adequately informed decision’ whether to agree to the December 1998 settlement agreement,” Fisher wrote.
The dissenting jurist argued that a reasonable employee, knowing that a court had found that the retirement board acted capriciously in denying football-related disability benefits to players with multiple injuries during the 10-year period in which Washington was seeking such benefits, might not have signed a settlement agreement relinquishing all claims for “past and future disability benefits.”
In addition, Fisher wrote, “knowledge that the Board could no longer rely on its previous reason for denying Washington’s attempts to get football-related benefits might have increased Washington’s estimated chances at ultimately securing such benefits” and thus altered his decision on whether to settle on the terms offered.
The case is Washington v. Bert Bell/Pete Rozelle NFL Player Retirement Plan, 05-16366.
Copyright 2007, Metropolitan News Company