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Sposato v. First Mariner Bank

United States District Court, Fourth Circuit

August 8, 2013

CHARLES F. SPOSATO
v.
FIRST MARINER BANK

MEMORANDUM

CATHERINE C. BLAKE, District Judge.

Plaintiff Charles F. Sposato brought this suit against defendant First Mariner Bank for declaratory and injunctive relief with respect to Sposato's rights to receive distributions from the Cecil Bank Supplemental Executive Retirement Plan ("SERP") despite the writs of garnishment First Mariner has served on Cecil Bank for those distributions. Now pending are First Mariner's motion to dismiss or, in the alternative, for summary judgment and Sposato's cross motion for summary judgment. In a previous order, the court held that Sposato's SERP benefits are not protected by ERISA and are at least partially subject to First Mariner's writs of garnishment. The court, however, reserved the issue of whether state or federal law protects 75% of the SERP benefits from garnishment. These issues have now been fully briefed, and no hearing is necessary. See Local Rule 105.6. For the following reasons, First Mariner's motion to dismiss will be granted in part and denied in part, and Sposato's motion for summary judgment will be denied in part and granted in part.

Background[1]

Sposato, a former executive employee of Cecil Bank, is a participant in, and beneficiary of, the SERP. (Def.'s Mem. in Supp. of Mot. to Dismiss or for Summ. J. [hereinafter Def.'s Mem.] at 2, ECF No. 6-1; Pl.'s Mem. in Supp. of Mot. for Summ. J. [hereinafter Pl.'s Mem.] at 2, ECF No. 9-2.) The SERP is "a plan which is unfunded and is maintained by an employer primarily for the purpose of providing deferred compensation for a select group of management or highly compensated employees" as described in Section 201(2) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1051(2). ( See SERP ¶ 11.10, Compl., Ex. 1, ECF No. 1-1.) This type of "unfunded" retirement plan is generally referred to as a "top hat" plan. (Def.'s Mem. at 9; Pl.'s Mem. at 3.)

First Mariner has served three writs of garnishment on Cecil Bank pursuant to Maryland garnishment law, Md. Rule § 2-645, seeking Sposato's SERP benefits, which garnishee Cecil Bank has identified as a debt it owes Sposato. (Compl. ¶¶ 16-21; Def.'s Mem. at 4.)

Legal Standard

A. Rule 12(b)(6) Dismissal

In reviewing a defendant's motion to dismiss for failure to state a claim under Federal Rule of Civil Procedure 12(b)(6), the court accepts as true all well-pleaded allegations and views the complaint in the light most favorable to the plaintiff. Philips v. Pitt Cnty. Mem. Hosp., 572 F.3d 176, 180 (4th Cir. 2009) (citing Mylan Laboratories, Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir. 1993)). To survive a motion to dismiss, "a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). The court, however, is not required "to accept as true a legal conclusion couched as a factual allegation." A Soc'y Without A Name v. Virginia, 655 F.3d 342, 346 (4th Cir. 2011), cert. denied, 132 S.Ct. 1960 (2012) (quoting Iqbal, 556 U.S. at 678) (internal quotations omitted). The court may consider documents attached to the complaint, as well as documents attached to the motion to dismiss if they are integral to the complaint and their authenticity is not disputed. Philips, 572 F.3d at 180; CACI Int'l v. St. Paul Fire & Marine Ins. Co., 566 F.3d 150, 154 (4th Cir. 2009); Blankenship v. Manchin, 471 F.3d 523, 526 n.1 (4th Cir. 2006).

B. Rule 56 Summary Judgment

Federal Rule of Civil Procedure 56(a) provides that summary judgment should be granted "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56(a). The Supreme Court has clarified that this does not mean that any factual dispute will defeat the motion. "By its very terms, this standard provides that the mere existence of some alleged factual dispute between the parties will not defeat an otherwise properly supported motion for summary judgment; the requirement is that there be no genuine issue of material fact." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986) (emphasis in original). Whether a fact is material depends upon the substantive law. See id.

"A party opposing a properly supported motion for summary judgment may not rest upon the mere allegations or denials of [his] pleadings, ' but rather must set forth specific facts showing that there is a genuine issue for trial.'" Bouchat v. Baltimore Ravens Football Club, Inc., 346 F.3d 514, 522 (4th Cir. 2003) (alteration in original) (quoting Fed.R.Civ.P. 56(e)). The court must "view the facts and draw reasonable inferences in the light most favorable to the party opposing the [summary judgment] motion, '" Scott v. Harris, 550 U.S. 372, 378 (2007) (alteration in original) (quoting United States v. Diebold, 369 U.S. 654, 655 (1962)), but the court also must abide by the "affirmative obligation of the trial judge to prevent factually unsupported claims and defenses from proceeding to trial." Drewitt v. Pratt, 999 F.2d 774, 778-79 (4th Cir. 1993) (internal quotation marks omitted).

Analysis

In its previous opinion, the court held that Sposato's SERP benefits are not protected from garnishment by ERISA. Sposato claims that both the Annotated Code of Maryland, Commercial Law Article Section 15-601.1 and Title III of the federal Consumer Credit Protection Act ("CCPA"), 15 U.S.C. §§ 1601 et ...


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