TEXAS: EMPLOYERS CASUALTY EMPLOYEES LOSE ERISA CLAIM.

Former employees of now-defunct Employers Casualty Co. have lost their claim to benefits under the Employee Retirement Income Security Act, with the Fifth U.S. Circuit Court of Appeals affirming a lower court's ruling dismissing their case.

"We find no violation of ERISA," Judge E. Grady Jolly wrote for the three judge panel in Bodine et al. v. Employers Casualty Co. et al. (03-20190).

When Employers Casualty began encountering financial difficulties in 1990, it amended its benefits plan several times, each time cutting its workforce by offering some employees enhanced benefits if they elected termination.

The company kept going downhill, however, and by 1994 it was ordered into receivership under the Texas insurance commissioner.

Daniel E. Bodine employees weren't among those terminated within the specified time, despite their requests, so they never offered any enhanced benefits. Eventually, all employees lost their jobs.

Meanwhile, some of the company's assets were transferred to the Prudential Insurance Co. of America and Hartford Life Insurance Co.

Bodine and other affected employees sued Employers Casualty, its receiver and the insurers that took over the assets. Among other things, they claimed ERISA was violated when they were denied termination and the associated benefits. A federal judge ruled against them, and they appealed.

The Fifth Circuit panel upheld the dismissal.

It said Section 510 of ERISA would have been violated if their employer had promised them a benefit that was eventually denied, and this didn't occur.