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Click here for the full text of this decision FACTS:Sara Lee Corp. appealed the district court’s grant of summary judgment for Frank Mello. The district court applied ERISA-estoppel and found that, because Mello, a Sara Lee employee, relied on the oral assurances of a company executive and on non-binding monthly pension statements to determine the value of his pension, Sara Lee was estopped from correcting a clerical error that reduced the amount of his expected benefits significantly. Sara Lee had acquired the company that employed Mello, and Mello was not entitled to participate in Sara Lee’s pension plan until a certain amount of time had elapsed. The parties’ dispute centered on whether Mello’s pension benefits should be calculated using the date he was hired by the original company or the date that he became eligible for Sara Lee’s pension plan. Sara Lee conceded that it erred as to the amount Mello’s benefit statements reflected that he was due upon retirement. Sara Lee argued, however, that those errors did not constitute material misrepresentations because the benefit statements were informal communications that could not be used to amend the plan. HOLDING:Reversed and dismissed. Sara Lee argues on appeal that representations are material only if they are in an official plan document. Sara Lee also argues that materiality is not in reference to “[w]hat is material to Mello” but rather “whether the Benefit Estimates are”material’ to the interpretation of the Plan.” The court disagrees and states that material misrepresentations can be made in informal documents. Because there was a substantial likelihood that a reasonable employee would be misled about making adequately informed decisions by Sara Lee’s benefit statements’ undisputed errors, the court holds that the district court correctly concluded that Sara Lee’s benefits statements to Mello were material misrepresentations. However, the court also points out that Mello must demonstrate reliance upon the representations made by Sara Lee, and that the reliance must be both reasonable and detrimental. Contrary to the district court’s conclusion, the court finds that it was unreasonable for Mello to rely on Sara Lee’s informal material misrepresentations regarding his benefits and that Mello consequently cannot establish his estoppel claim. The court explains that ERISA’s policy against informal modifications of plan terms precludes a finding that Mello reasonably relied on the benefit statements’ pension amounts. The court points out that Mello does not argue that he relied on the benefit statements and Sara Lee’s oral representations to help him interpret an ambiguous or unclear term in the plan. Rather, he contends that he was reasonable to rely on the benefit statements and Sara Lee’s assertions rather than the unambiguous credited service definition in the plan. The court finds that Mello’s claim therefore amounts to an argument that informal written and oral statements amended or modified the terms of the plan. But the court notes that ERISA-estoppel is not permitted if “based on purported oral modifications of plan terms.” The court holds that Mello’s claim cannot surmount the clear and consistent case law forbidding recognizing reasonable reliance on informal documents in the face of unambiguous plan terms. Because Mello’s reliance on the informal benefit statements and oral representations was unreasonable, the court concludes that it need not consider whether the reliance was detrimental or if extraordinary circumstances existed. OPINION:Clement, J.; Garwood, Smith, and Clement, JJ.

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