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Click here for the full text of this decision FACTS:In September 1998, Dresser Industries Inc. merged into a wholly owned subsidiary, Halliburton N.C. Inc., of Halliburton Co. Halliburton agreed to maintain the Dresser Retiree Medical Program for eligible participants, except to the extent that any modifications to the program are consistent with changes in the medical plans provided by Halliburton for similarly situated active employees. In November 2003, Halliburton amended three subplans of the Dresser Retiree Medical Program “to align the benefits provided to the participants in the three subplans more closely with the benefits provided to other Halliburton retirees.” Halliburton did not make similar modifications to the plans for its own similarly situated active employees. After receiving written complaints from at least three Dresser retirees challenging the validity of the November 2003 amendments in light of the merger agreement, Halliburton filed this Employee Retirement Income Security Act action against the Dresser retirees in the district court, seeking class certification of all participants in the Dresser Retiree Medical Program and declarations that the November 2003 amendments are valid and that the merger agreement does not limit Halliburton’s right to amend or terminate the Dresser retiree program. The parties filed cross-motions for summary judgment, and on Dec. 20, 2004, the district court granted partial summary judgment in favor of the Dresser retirees. The district court concluded that the merger agreement modified the Dresser Retiree Medical Program and that Halliburton must maintain the program for eligible participants and may amend or terminate the program only if it makes the same changes to the programs for its similarly situated active employees. HOLDING:Affirmed. The post-merger agreement not only gave Halliburton a right to amend or terminate the retiree program, but it also imposed a concomitant obligation on Halliburton to maintain the program according to its terms. The parties disagreed over whether �7.09(g)(i) of the merger agreement amended the retiree program in such a way as to limit Halliburton’s otherwise unfettered right to amend or terminate the plan. Halliburton maintained that �7.09(g)(i) could not have amended the retiree program because the merger agreement was not signed by Dresser’s vice president of human resources. The court looked to the plan amendment procedures applicable to the Dresser Retiree Medical Program, finding that Dresser always had the authority to revoke the vice president’s authority and evidence its action to amend the plan in some other authorized way, such as by resolution of the board of directors or by written direction of the chairman of the board of directors. Accordingly, Dresser’s board of directors’ approval and the chairman of the board of directors’ signature on the merger agreement were more than sufficient to constitute an action by the company to amend the plan. The court also notes that Halliburton, as illustrated by its own actions, has recognized that under the amendment provision, the Dresser welfare plans may be amended by procedures other than a writing signed by the vice president of human resources. Even if the vice president’s signature had been required for �7.09(g)(i) to amend the retiree program, Halliburton’s subsequent actions served to ratify the provision. Halliburton ratified �7.09(g)(i) as an amendment to the Dresser Retiree Medical Program in at least two ways. First, the shareholders of Halliburton and Dresser approved the merger agreement on June 25, 1998, four months after the agreement was executed, thereby ratifying the amendment to the extent it was unauthorized. Second, Halliburton administered its obligations under the Dresser Retiree Medical Program consistent with �7.09(g)(i). Halliburton maintains that under the plain language of the no-third-party-beneficiary clause in �10.07 of the merger agreement, the Retirees cannot enforce any provision of the agreement, including �7.09(g)(i). The court disagrees: First, Halliburton’s contention that the Retirees are precluded by �10.07 of the merger agreement from enforcing �7.09(g)(i) wrongfully equates a plan participant’s enforcement of a plan right under ERISA with a third party’s enforcement of a provision in a contract; Second, Halliburton’s claim that only certain parties were entitled to enforce �7.09(g)(i) for a three-year period is not supported by the express language in the merger agreement. Halliburton argues that �7.09(g)(i) violates the prohibition in the merger agreement on vested benefits and that, in any event, there was no clear intention to vest benefits under �7.09(g)(i) as required by Spacek v. Mar. Ass’n, 134 F.3d 283 (5th Cir. 1998), abrogated on other grounds by, Cent. Laborers’ Pension Fund v. Heinz, 541 U.S. 739 (2004). However, because Halliburton may modify or terminate the program, the benefits have not vested. Finally, �7.09(g)(i) precludes future amendment or termination of the plan, except as consistent with the provision’s terms. However, a reservation-of-rights clause in a plan document, which allows a company to amend or terminate a plan at any time, cannot vitiate contractually vested or bargained-for rights. OPINION:King, C.J.; King, Stewart and Dennis, J.J.

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