Pension Plan Actuarial Assumption Litigation: The End Is Not Yet In Sight

One recent line of ERISA litigation involves the actuarial equivalence factors used by defined benefit pension plans.  The lawsuits apply both to active defined benefit pension plans and pension plans that have been "frozen" as to future benefit accruals.

Background

In a traditional defined benefit pension plan, a participant's benefit typically is calculated under a formula that defines the benefit in terms of a monthly life-only annuity commencing with the month following the participant's sixth-fifth (65^th) birthday with no survivor benefit following the participant's death (the "Life Annuity Benefit"). 

Although the pension plan formula defines the Life Annuity Benefit, plan participants may receive payment of their pension benefit in a form other than the age 65 Life Annuity Benefit.  Federal pension law generally requires that the benefit payable to a married participant be paid in the form of a joint and surviving spouse annuity ("Joint and Survivor