Judge Lawrence Kahn
Dubee, employed by Don Scammell Inc., participated in its employee stock accumulation and retention plan (Plan). Dubee alleged the Plan's violation of ERISA because he was not allocated sufficient company shares, and those he was awarded were undervalued. In addition to repeating his ERISA claims, Dubee's amended complaint added seven state-law claims as alternative causes of action. District court only partly granted defendants' second dismissal motion. Of the three factors identified by the Second Circuit in Tischmann v. ITT/Sheraton Corp., two weighed strongly against ERISA coverage. The nondiscretionary nature of benefit calculations under the Plan outweighed the contingent, limited, never-exercised discretion involved in selecting additional Plan participants and investing stock dividends. However, defendants did not seek dismissal of Dubee's ERISA claims. They focused almost exclusively on Dubee's putatively dispositive admission of ERISA coverage and never addressed the issue of whether the Plan required an ongoing administrative program. As a result, Dubee lacked sufficient notice and opportunity to be heard on that issue. Thus the court granted leave for additional briefing.