Judge Patrick Murphy has issued a Memorandum and Order in the case of Cooper v. IBM Personal Pension Plan and IBM Corporation. The Memorandum and Order grants plaintiffs’ motion to strike defendants’ attempt to assert “an affirmative defense out of time, or, in the alternative, to compel discovery and for extension of time.” IBM was arguing against the retroactive relief requested by plaintiffs based upon an argument that IBM was “blind-sided by what is characterized as a drastic change in the law.” IBM argued that the Court’s declaration that IBM’s 1995 PCF and 1999 cash balance plan violated the age discrimination prohibitions of ERISA section 204(b)91)(H) was a “startling new development in pension law” so that the “Court should exercise its discretion and grant only prospective relief.”

The Court says the following, in granting plaintiffs’ motion to strike:

. . . IBM is by no means in the sympathetic position of the employer in Manhart. Defined benefit plans are highly regulated and strictly scrutinized relative to defined contribution plans. The prohibition against age discrimination existed long before the appearance of cash balance plans. Indeed, the voluminous record in this case unequivocally shows that cash balance plans were a “response” to the long standing restrictive proscriptions that are the woof [warp?] and weave of a defined benefit plan. If this Court is correct, then the class is entitled to retroactive relief. There has not been a change in the law. All that has changed is IBM’s clever, but ineffectual, response to law that it finds too restrictive for its business model. . .