William Hampton, by and through his spouse and next friend, Melody Hampton v. Dana Corporation

*The Honorable Bernice Bouie Donald, United States District Judge for the Western
District of Tennessee, sitting by designation.
No. 04-4272
File Name: 05a0846n.06
Filed: October 14, 2005
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
WILLIAM HAMPTON, by and through his
spouse and next friend, Melody Hampton,
Plaintiff-Appellant,
v.
DANA CORPORATION,
Defendant-Appellee.
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ON APPEAL FROM THE
UNITED STATES DISTRICT
COURT FOR THE SOUTHERN
DISTRICT OF OHIO
Before: NELSON and GILMAN, Circuit Judges, and DONALD, District Judge. *
DAVID A. NELSON, Circuit Judge. This case involves a claim that the defendant
employer improperly reduced the plaintiff employee’s long term disability benefits by the
amount of social security benefits to which the employee’s children were entitled as a result
of his disability. The district court dismissed the case on the ground that the language of the
employer’s long term disability plan clearly and unambiguously authorizes the reduction.
We shall affirm the dismissal of the action. Because the plan gives the employer
discretionary authority to construe plan language, the employer’s interpretation of the
relevant language is binding if it is reasonable. Whether or not the language of the plan is

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1The plan may be considered as a part of the pleadings in this case because it was
referred to in Mr. Hampton’s complaint, it is central to Hampton’s claims, and it was attached
to Dana’s motion to dismiss. See Weiner v. Klais & Co., Inc., 108 F.3d 86, 89 (6 th Cir.
1997).
as clear and unambiguous as the district court thought, the language is at least reasonably
susceptible of the interpretation given it by the employer. That is enough to entitle the
employer to judgment.
I
The plaintiff, William Hampton, was employed by the defendant, Dana Corporation,
for nearly 35 years. In February of 2000 Mr. Hampton was found to be totally disabled
within the meaning of Dana’s Long Term Disability Benefits Plan, an employee welfare
benefit plan governed by the Employee Retirement Income Security Act (“ERISA”), 29
U.S.C. §§ 1001 et seq. Dana began to pay Mr. Hampton monthly benefits as required by the
plan.
The plan provided that monthly benefits would be reduced by “the amount of any
Primary and Family Social Security Benefits for which the Employee is . . . eligible.”1 In
reliance on that provision, Dana reduced Mr. Hampton’s benefits by the sum of (1) the
disability insurance benefits to which Hampton was entitled under the social security laws
and (2) the insurance benefits under those laws to which his children were entitled.

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Through his wife, Mr. Hampton complained to the company about the reduction of
his plan benefits by the amount of the social security benefits to which his children were
entitled. Dana made no written response, but it informed Mrs. Hampton that it calculated
other employees’ benefits in the same way that it calculated Mr. Hampton’s benefits.
Thereafter, acting on behalf of himself and others similarly situated, Mr. Hampton
sued Dana in federal court under 29 U.S.C. § 1132(a)(1)(B). He alleged that Dana’s
reduction of monthly benefits by the amount of social security benefits payable to
employees’ children resulted in a denial of benefits due under the terms of the plan.
Dana moved to dismiss the complaint under Rule 12(b)(6), Fed. R. Civ. P. The
district court granted the motion, holding that “the Plan language clearly and unambiguously
authorizes Dana Corporation to reduce payment of long term disability benefits by the
amount of benefits received by plaintiff’s family members based on his disability.” This
appeal followed.
II
A district court’s decision to dismiss a complaint under Rule 12(b)(6) is reviewed de
novo. See Amini v. Oberlin College, 259 F.3d 493, 497 (6 th Cir. 2001). We may affirm on
any ground supported by the record. See City of Monroe Employees Retirement System v.
Bridgestone Corp., 399 F.3d 651, 665 (6th Cir. 2005), petition for cert. filed, No. 04-170
(Aug. 1, 2005).

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2The plan also provides that “any interpretations and decisions made by [Dana] shall
be final, conclusive and binding upon any persons who have or who claim to have any
interest in or under the Plan.”
Where an ERISA plan gives its administrator “discretionary authority to determine
eligibility for benefits or to construe the terms of the plan,” the administrator’s benefit
determinations must not be disturbed unless they are arbitrary and capricious. Firestone Tire
& Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); Williams v. International Paper Co., 227
F.3d 706, 710-11 (6 th Cir. 2000). Dana’s plan gives the company “the power to interpret the
Plan and to decide any and all matters arising hereunder; including but not limited to the right
to remedy possible ambiguities . . . by general rule or particular decision; provided, that all
such interpretations and decisions shall be applied in a uniform and nondiscriminatory
manner . . . .” 2 It is undisputed that this language grants Dana the discretionary authority
contemplated by the Supreme Court in Firestone.
The question that we view as dispositive in this case is whether Dana acted arbitrarily
and capriciously by interpreting the plan so as to allow reduction of plan benefits by the
amount of social security benefits payable to employees’ children. Dana’s interpretation is
not arbitrary and capricious if it is “rational in light of the plan’s provisions.” Williams, 227
F.3d at 712 (internal quotation marks omitted).
Mr. Hampton argues that Dana’s interpretation is unreasonable because social security
benefits that are payable to an employee’s children are not social security benefits “for which
the Employee is . . . eligible.” Only the child is “eligible” for child’s insurance benefits,

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Hampton says, and such benefits are therefore outside the scope of the plan language
authorizing reductions of monthly benefits.
Mr. Hampton relies on a Third Circuit case dealing with a similar dispute. See In re
Unisys Corp. Long-term Disability Plan ERISA Litigation, 97 F.3d 710 (3d Cir. 1996). Plan
language at issue in Unisys provided that an employee’s long term disability benefits could
be reduced “if you [i.e., the employee] receive . . . disability income from other sources, such
as Social Security . . . .” Id. at 715. The Third Circuit held that this language did not permit
reduction of an employee’s plan benefits by the amount of social security benefits received
by the employee’s dependents. See id. at 716-17.
The Unisys case is distinguishable from the case at bar in two important respects.
First, the Unisys plan referred to benefits “you receive,” and the Third Circuit’s decision
turned largely on a determination that disabled employees do not “receive” their dependents’
social security benefits. See id. The Dana plan, on the other hand, refers to benefits for
which an employee is “eligible.” Unisys does not say whether a disabled employee may be
“eligible,” in some sense, for social security benefits that are payable to his or her children.
Second, the Unisys plan referred to “disability income from other sources, such as
Social Security,” without specifically mentioning dependents’ social security benefits. This
was significant because, as the Third Circuit held, a long term disability plan “must specify
whether” primary benefits, dependent benefits, or both “are to be offset from plan benefits.”
Id. at 716. The Dana plan differs substantially from the Unisys plan in that the Dana plan

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refers to “Primary and Family Social Security benefits” as potential offsets from plan
benefits.
Given these important differences, the Unisys decision is not directly on point here.
“Social Security income that the employee receives,” to paraphrase the plan language in
Unisys, might very well require a narrower interpretation than “Primary and Family Social
Security benefits for which the Employee is . . . eligible.”
Focusing on the particular language of the Dana plan, we think it is reasonable to
interpret “Primary and Family Social Security benefits for which the Employee is . . .
eligible” as including a child’s insurance benefits. As the district court noted, a child’s
benefits are awarded “on the basis of the employee’s eligibility” for disability insurance
benefits. It is not too much of a stretch, in our view, to say that the disabled employee is
“eligible” for “Family” benefits that are payable to his or her children.
Logic strongly supports this interpretation. The purpose of the plan is to replace
income that is lost because of the employee’s disability. Logically, any offsets from plan
benefits should correspond to other benefits that are awarded for the same purpose. It makes
good sense, therefore, to interpret “Family Social Security benefits for which the Employee
is . . . eligible” as meaning benefits to which family members are entitled because of the
employee’s disability — and not, for example, benefits to which the employee is entitled
because of the disability of some other family member. The plan’s purpose would be

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disserved if monthly benefits were reduced by the amount of social security benefits that
were awarded for reasons other than the employee’s disability.
We need not decide whether Dana’s interpretation of the plan language is the only
permissible interpretation. For the reasons stated above, we are satisfied that Dana
interpreted the plan rationally. Accordingly, Dana’s benefits determinations must not be
disturbed. The dismissal of Mr. Hampton’s action is AFFIRMED.

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