allstatepension

Welcome to the ALLSTATE AGENTS PENSION FUND "CUTBACK" CLASS ACTION
(ROMERO II) WEBSITE.

The proposed class action lawsuit known as "Romero II" was filed by 32 individuals who had been employed by Allstate Insurance Company ("Allstate") under R830 Agent Compensation Agreement and R1500 Agent Employment Agreement and who remain participants in and/or beneficiaries of the Agents Pension Plan. The plaintiffs allege that the Allstate defendants sought to amend the Plan throughout the 1990's for the purpose of unlawfully "cutting back" accrued retirement benefits. The lawsuit also alleges that Allstate knowingly misrepresented that agents who continued in the service of the company as so-called "independent contractors" could not accrue additional retirement benefits or become entitled to early retirement.

Court I of the Complaint alleges that certain amendments to the Pension Plan that purportedly were adopted in 1994 and 1996 (relating to "credited service" and defining the term "employee") violated section 204(g) of the Employee Retirement Income Security Act or "ERISA." Count II alleges that Allstate and the plan administrator violated their fiduciary duties under section 404 of ERISA by falsely representing that service to Allstate as a so-called "independent contractor" would not count as "credited service" under the Pension Plan. Count III alleges that certain amendments which Allstate attempted to adopt in an effort to phase-out "beefed up" early retirement benefits also violated section 204(g) because they had the effect of eliminating or reducing an early retirement benefit. Plaintiffs dismissed Court IV of the Complaint in 2005.

By Order dated March 30, 2004, the Honorable John P. Fullam, Senior U.S. District Judge, dismissed all four claims asserted by plaintiffs on the ground that they are time-barred and, in any event, the plaintiffs would be able to recover their lost benefits through the companion Romero I and EEOC cases. Additional information about Romero I and the two lawsuits the EEOC has brought against Allstate can be found at www.allstatecase.com. Plaintiffs thereafter appealed the dismissal.

In 2005, the United States Court of Appeals for the Third Circuit reversed Judge Fullam's ruling. The Court of Appeals found that it was premature to dismiss plaintiffs' claims as time-barred, holding that no claim accrues under section 204(g) until there has been a "clear repudiation" of retirement benefits. As to Count II, the Court of Appeals held that the fiduciary duty claim was not duplicative of the claims that remain pending in the Romero I litigation, therefore, is deserving of consideration in its own right and solely in the context of section 404 of ERISA.

After the case was remanded back to Judge Fullam for further proceedings consistent with the Court of Appeal's opinion, Allstate renewed a motion seeking dismissal of the remaining claims on the ground that they were duplicative of claims that had been adjudicated in two earlier decisions known as "Scott" and "Swain." Plaintiffs thereafter renewed their motion for class certification.

In a ruling dated March 21, 2007, Judge Fullam advised the parties that he has reached a number of tentative conclusions in this case, as well as in the pending Romero I and EEOC cases. As set forth in the memorandum opinion issued by the Court, Judge Fullam stated that he had concluded that challenged amendments to the Agents Pension Plan were "validly adopted and became effective." In reaching this conclusion, it appears that Judge Fullam relied exclusively on Scott and Swain, despite the fact that the claims in those two cases were brought in connection with different amendments to the Plan that were adopted by Allstate in November 1991, and made retroactive to January 1, 1989. Judge Fullam has invited the parties to submit additional briefs that bring to the Court's attention any issues that he may have overlooked, as well as any argument or "other factor" that impugns the decisions in Scott and Swain. Plaintiffs believe that the tentative conclusion reached by Judge Fullam is not correct and will file a brief that attempts to explain why he is in error. We will keep you advised of any further rulings from the Court.

This website was created by Morgan, Lewis & Bockius LLP, Sprenger & Lang, PLLC and AARP Foundation Litigation (collectively, "Class Counsel") to provide basic information on the Romero II lawsuit. Anyone seeking additional information about the case, including whether they are included in the class that plaintiffs seek to have certified, are encouraged to contact Class Counsel.

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