Failure to Provide Plan Documents from 1979 Results in Penalties

In Hartman v. Dana Holding Corporation, Elaine Hartman requested plan documents to determine her benefits under the plan. Mrs. Hartman’s husband had elected to begin receiving benefits from the plan in 1979. When Mr. Hartman dies, Mrs. Hartman contacted the plan for documents to determine whether she was entitled to benefits as a surviving spouse. 

Although the U.S. District Court for the Northern District of Indiana determined that she was not eligible for any benefits, it held that she was entitled to receive statutory penalties. The court explained that “a participant or beneficiary is entitled to outdated plan documents if they contain information necessary for her to understand and assert her rights under the plan.” 

The defendants argued that a penalty was not appropriate as the failure to provide the documents was reasonably beyond its control. They claimed that the company administers plans for over 40,000 participants, has over 50 plans under which benefits are received and which were amended multiple times, and the plan documents relate to the same period that a merger occurred. While the court found that the defendants did not act in bad faith, it nevertheless assessed a penalty of $10 per day.

Given the court’s holding, plan sponsors should make significant attempts to locate and maintain historic plan documents.

To read the court’s decision, click here.