United States District Court, D. Delaware
HELENA DUPONT WRIGHT, JAMES MILLS, JOSEPH WRIGHT, and T. KIMBERLY WILLIAMS, Plaintiffs/Counter-defendants,
ELTON CORPORATION, GREGORY FIELDS, FIRST REPUBLIC TRUST COMPANY OF DELAWARE LLC, and M.C. DUPONT CLARK EMPLOYEES PENSION TRUST, Defendants/Counter-claimants/Third-party Plaintiffs,
JAMES B. WYETH, Solely as Executor and Personal Representative of the Estate of Phyllis M. Wyeth, MARY MILLS ABEL SMITH, CHRISTOPHER T. DUPONT, and MICHAEL DUPONT, Third-party defendants.
MEMORANDUM AND ORDER
F. BATAILLON, SENIOR UNITED STATES DISTRICT JUDGE
matter is before the Court on the parties' cross-motions
for summary judgment on Count I of the plaintiffs' second
amended complaint (D.I. 120 and D.I. 124). This is an action
for declaratory and injunctive relief involving an employee
benefit trust, allegedly governed by the Employee Retirement
Income Security Act of 1974 (“ERISA”), 29 U.S.C.
§ 1001 et seq. In this action, the plaintiffs seek (1) a
declaratory judgment that the trust at issue is an ERISA
Pension Plan subject to federal law and (2) an injunction
ordering defendants to bring the plan into compliance with
ERISA. The action has been bifurcated for a determination of
the threshold issue of whether or not the trust at issue is
governed by ERISA. See oral order dated June 14, 2017.
their cross-motions for summary judgment, plaintiffs seek an
order that the trust at issue is an ERISA-governed plan and
defendants' and third-party defendants (hereinafter,
collectively, “defendants”) jointly move for a
declaration that the trust at issue is not subject to
action for declaratory and equitable relief under 29 U.S.C.
§ § 1132(a)(3) was originally commenced by
plaintiffs Helena duPont Wright and James Mills against Elton
Corporation (“Elton Corp.”) and Gregory Fields,
alleged fiduciaries of the Mary Chichester duPont Clark
Employee Pension Trust (“the Trust”) (D.I. 1).
The plaintiffs each employed domestic employees who are
allegedly entitled to benefits under the Trust (D.I. 35).
their complaint, the plaintiffs sought a determination that
the Trust is governed by ERISA and an order requiring the
defendants to comply with the statute. Plaintiffs Wright and
Mills are the grandchildren of Mary Chichester duPont, the
settlor of the Trust at issue. The defendants moved to
dismiss for lack of subject matter jurisdiction, lack of
statutory standing under ERISA, and improper venue.
Thereafter, the plaintiffs filed an amended complaint, adding
the Mary Chichester DuPont Clark Employee Pension Trust (the
“Trust”) and First Republic Trust Company of
Delaware LLC, the current trustee of the Trust, (hereinafter,
collectively, “First Republic”) as party
defendants (D.I. 8). First Republic moved to dismiss (D.I.
37) and also filed a counterclaim against the plaintiffs and
a third-party complaint against third-party defendants Mary
Mills Abel Smith, Christopher T. duPont, Michael duPont,
Phyllis M. Wyeth, and Katharine D. Gahagan, who are also
grandchildren of Mary Chichester duPont Clark. D.I. 61. The
plaintiffs thereafter filed a second amended complaint,
adding T. Kimberly Williams and Joseph Wright, alleged to be
employees covered by the Trust, as parties plaintiff.
Defendants again moved to dismiss on substantially similar
grounds. The District Court of Maryland granted the motion to
dismiss on grounds of improper venue and transferred the case
to this Court (D.I. 45). Resolution of other issues has been
deferred pending resolution of the cross-motions for summary
judgment on the ERISA coverage issue.
record shows that Mary Chichester DuPont created the Mary
Chichester DuPont Clark Employee Pension Trust (the
“Trust”) on September 11, 1947. The Trust was
initially funded with 50 shares of the common stock of
Christiana Securities Company. D.I. 125-1, Ex. 1, Affidavit
of Katherine Gahagan (“Gahagan Aff.”) at 1. The
Trust provides that every qualified beneficiary “shall
be entitled to an annual pension for the life of such
Pensioner or during the continuance of this trust whichever
is shorter, at the rate of sixty percent (60%) of the annual
money wages or salary at which such Pensioner was employed .
. . .” D.I. 125-1, Gahagan Aff., Exhibit (Ex.) A, Trust
Instrument. The Trust defines its beneficiaries as
any domestic employee or any employee rendering secretarial,
accounting, or other assistance in the management of his
employer's private, financial, and social affairs who may
be employed by any one or more of Mary Chichester DuPont, A.
Felix DuPont, Jr., Lydia C. DuPont, Alice DuPont Mills,
Allaire Crosier DuPont and/or any grandchild of the Trustor.
Id. at 2, ¶ 1.
Trust uses the term “Qualified Employer” to refer
to family members whose employees are entitled to pensions
under the Trust. Id. The Trust is managed and
controlled by its trustee or trustees. D.I. 125-1, Ex. 1
Gahagen Aff. at 2. The initial trustees of the Trust were
Lydia C. duPont, A. Felix duPont, Jr. and Alice duPont Mills.
Id. In 1958, Lydia C. duPont died and Allaire C.
duPont was appointed as a trustee. Id. In 1989,
trustees Alice duPont Mills and Allaire C. duPont resigned.
Id.; Ex. C. Thereafter, A. Felix duPont, Jr., then
the sole trustee, appointed Elton Corp. as co-trustee of the
Trust. Id. at 3; Ex. D. A. Felix DuPont, Jr. died on
December 30, 1996 leaving Elton Corp. as the sole trustee.
Id. Effective on August 7, 2015, Elton Corp.
resigned as a trustee of the Trust and appointed First
Republic as successor trustee. Id.
Corp. is a corporation established by A. Felix duPont, to
administer various DuPont family trusts, including the Trust
at issue. D.I. 122, Ex. B, Deposition of Katharine Gahagen
(“Gahagen Dep.”) at 14. As trustee, Elton Corp.
determined whether an employee of a DuPont family member was
entitled to a pension under the terms of the Trust.
Id. at 15. It determined whether such employee: (1)
had reached the age of 65; (2) had been working for an
applicable DuPont family member for ten years, and (3) was
still working for such family member at the time he or she
turned 65. Id. A. Felix duPont, and later his
daughter, Katharine Gahagen, served as the President of Elton
Corp. At the time he took over as sole trustee, A. Felix
duPont stated that his plans were “to establish a
pension plan for [his] employees and to appoint a successor
trustee for the Trust.” D.I. 125-1, Ex. C.
Trust provides that the trustee's duties are:
To hold, manage, invest and reinvest the same, to collect the
income arising therefrom, to pay out of such income all
charges and expenses, properly payable thereout, including
reasonable compensation to my said Trustees, and to pay over
from income or principal in the manner and amounts at the
times hereinafter set forth unto the Pensioner or Pensioners
as hereinafter defined annual pensions so long as any funds
remain in the hands of my said Trustees, and to ...