Joe A. Hooven, et al. v. Exxon Mobile Corporation, et al.

This case arises out of a dispute over whether
employees divested in connection with the merger between
Mobil Corporation and Exxon Corporation are entitled to
severance benefits. In preparation for the merger, Mobil
implemented an Enhanced Change-in-Control Retention /
Severance Plan (the "CIC Plan").

Plaintiffs Joe A. Hooven, et al., are former Mobil
Corporation employees whose employment with the merged
Exxon Mobil Corporation was terminated when the division
for which they worked was divested to Tosco Corporation.
Plaintiffs contend that they are entitled to benefits under the
terms of a summary plan description (the "Initial SPD") that
Mobil distributed to employees following the announcement
of the merger. They sued Defendants Exxon Mobil
Corporation and the Mobil Corporation Employee Severance
Plan (together, "Exxon Mobil") under the civil enforcement
provision of the Employee Retirement Income Security Act of
1974, 29 U.S.C. § 1132, asserting claims for breach of
fiduciary duty, equitable estoppel, procedural and reporting
violations and federal common law breach of contract.

After a bench trial, the District Court issued a
memorandum opinion and order granting judgment in favor of
Exxon Mobil on the fiduciary duty, equitable estoppel and
procedural and reporting claims. However, the District Court agreed with Plaintiffs that the Initial SPD established a
unilateral contract that obligated Exxon Mobil to provide
them with severance benefits when it terminated their
employment following the merger. Accordingly, it entered
judgment in favor of Plaintiffs on the breach of contract claim
and ordered Exxon Mobil to provide Plaintiffs with severance
benefits under the terms of the Initial SPD. Exxon Mobil
appeals this portion of the District Court's order.

We disagree with the District Court's characterization
of the Initial SPD as a unilateral contract the terms of which
became fixed as the employees performed. As we will
explain, the starting point for Plaintiffs' claim is ERISA, not
the common law of contracts. Under this framework,
Plaintiffs' rights to benefits under the Initial SPD never
became due. Because the plan documents that were in effect
when Plaintiffs' claim to benefits would have accrued clearly
establish that they are ineligible for severance, we will reverse
and remand with instructions for the District Court to enter
judgment for Exxon Mobil.1

* * *