Full opinion text
MEMORANDUM OPINION AND ORDER MORTON DENLOW, United States Magistrate Judge. This ERISA class action presents the issue of whether a billion dollar scrivener’s error should be reformed or enforced as written. Plaintiff Cynthia N. Young (“Plaintiff’ or “Young”) alleges that Defendants Verizon’s Bell Atlantic Cash Balance Plan (the “Plan”) and Verizon Communications, Inc. (“Verizon”) (collectively “Defendants”) improperly calculated her pension benefits, and those of similarly situated employees. Plaintiff seeks judicial review of the final decision of the Plan Administrator denying her claims for additional benefits. In their counterclaim, Defendants seek reformation of the Plan to correct an alleged scrivener’s error. This Court previously considered these issues applying a deferential standard of review to the Plan administrators’ decisions to deny Plaintiffs claims based upon the administrative record. Young v. Verizon’s Bell Atlantic Cash Balance Plan, 575 F.Supp.2d 892 (N.D.Ill.2008). (“Phase I Trial.”) Because this case raises novel issues under ERISA and will likely proceed to the Seventh Circuit Court of Appeals, the Court now reviews these issues applying a de novo standard of review, while permitting the parties to introduce additional evidence. It is the Court’s intention to decide all issues in such a way that the reviewing court can finally resolve the case without the necessity for a later remand. The Court conducted a second trial on September 1 and 2, 2009 and heard closing arguments on October 5, 2009. (“Phase II Trial.”) The Court has carefully considered the testimony of the two witnesses who testified at the trial, the deposition excerpts of the witnesses included in the parties’ exhibits, the parties’ trial exhibits, the parties’ agreed statement of facts, the parties’ proposed findings of fact and conclusions of law, the parties’ briefs and the closing arguments of counsel. The following constitute the Court’s findings of fact and conclusions of law in accordance with Rule 52(a) of the Federal Rules of Civil Procedure. To the extent certain findings of fact may be deemed conclusions of law, they shall also be considered conclusions of law. Similarly, to the extent matters contained in the conclusions of law may be deemed findings of fact, they shall also be considered findings of fact. I.ISSUES PRESENTED 1. Whether the Defendants properly used an interest rate of 120% of the PBGC rate, rather than 100% of the PBGC rate, in calculating Plaintiffs opening balance (“Discount Rate Issue”). ANSWER: Yes. 2. Whether there was a scrivener’s error in Plan § 16.5.1(a)(2) by reason of a second reference to the transition factor in the calculation of the opening balance (“Transition Factor Issue”). ANSWER: Yes. 3. Whether the Defendants are entitled to reformation of the Plan to eliminate the second reference to the transition factor in Plan § 16.5.1(a)(2). ANSWER: Yes. 4. Whether Plaintiffs claims are barred by the statute of limitations. ANSWER: No. 5. Whether Defendants’ claims are barred by the statute of limitations. ANSWER: No. II. FINDINGS OF FACT A. The Parties. 1. Plaintiff Cynthia N. Young is the Class representative for the Class in this action. AG ¶ l. She testified by means of a deposition. (DX 58.) 2. Young worked at Bell Atlantic (or one of its acquired subsidiaries) from 1965 through 1997. During the course of her career, she was a telephone operator, service representative, administrative assistant, communications representative, assistant manager, and manager, and she finished her career as a project manager. AG ¶ 2. 3. Young was a participant in a series of defined benefit pension plans, including the Bell Atlantic Management Pension Plan (“BAMPP”), and then the 1996 and 1997 Bell Atlantic Cash Balance Plan (“Cash Balance Plan”). Young retired in 1997 when the 1997 Bell Atlantic Cash Balance Plan was the operative plan and received a lump-sum payment of her benefit on February 2, 1998, in the amount of $286,094.89. AG¶3. 4. Young later received another payment of $9,558.70 related to her participation in the Cash Balance Plan due to a settlement by the Plan with the Equal Employment Opportunity Commission (“EEOC”). AG ¶ 4. 5. Defendant Verizon Communications, Inc. (“Verizon”) is a Delaware corporation with its principal place of business in Basking Ridge, New Jersey. Verizon is the successor-in-interest to Bell Atlantic Corporation (“Bell Atlantic”). Bell Atlantic was one of seven regional telephone operating companies created on January 1, 1984 as a result of the divestiture of AT & T. It represented one of 22 local operating companies that AT & T owned and served the northern Atlantic states. Bell Atlantic was headquartered in Philadelphia and consisted of telephone companies in Pennsylvania, New Jersey, Delaware, Maryland, Virginia, West Virginia and the District of Columbia. An agreement to merge Bell Atlantic and NYNEX, the regional telephone operating company for New York and New England, was announced in April 1996 and became final on August 14, 1997. The combined company took the name of Bell Atlantic, with headquarters in New York City and a workforce of 130,000 employees. On July 27,1998, Bell Atlantic announced an agreement to merge with GTE, and this merger was effective on June 30, 2000, with the new company taking the name of Verizon Communications, Inc. AG ¶ 5. 6. The merger of Bell Atlantic and NYNEX, and the subsequent merger of Bell Atlantic and GTE, were both large mergers. Bell Atlantic after the first merger and Verizon after the second merger amended their numerous benefit plans, including pension plans and a variety of welfare plans. Bell Atlantic/Verizon implemented these two major mergers and transformed its business from regional telephone operations to a leading provider of national and international wireless telephone and high-speed internet services. AG ¶ 6. 7. Verizon is “both the plan sponsor and the plan’s administrator.” Young v. Verizon’s Bell Atlantic Cash Balance Plan, 575 F.Supp.2d 892, 907 (N.D.Ill. 2008). AG ¶ 6. In 2008, Verizon earned $6.4 billion in profits on revenues of $97.4 billion. (PX 204 and 205.) B. The Class. 8. The parties stipulated to the treatment of this action as a class action. On January 16, 2007, the Court certified a Class pursuant to Rule 23, Fed.R.Civ.P., with two subclasses. AG ¶ 8; Dkt. 61. 9. Subclass 1 is defined as follows: All participants in the Bell Atlantic Management Pension Plan whose opening balances for the Bell Atlantic Cash Balance Plan were purportedly calculated using section 16.5.1 of the Bell Atlantic Cash Balance Plan and using 120% of the applicable PBGC rate. Dkt. 61. 10. The class claim associated with Subclass 1 (hereinafter called the “Discount Rate Issue”) is defined as follows: Whether, in determining the benefits afforded by the Bell Atlantic Cash Balance Plan to the plaintiff and the Class, it was improper to use 120% of the applicable PBGC interest rate when calculating the “opening balances,” and, if proper, the remedy therefor. Dkt. 61. 11. Subclass 2 is defined as follows: All participants in the Bell Atlantic Management Pension Plan whose opening balances for the Bell Atlantic Cash Balance Plan were purportedly calculated using section 16.5.1(a)(2) of the Bell Atlantic Cash Balance Plan. Dkt. 61 12. The class claim associated with Subclass 2 (hereinafter called the “Transition Factor Issue”) is defined as follows: Whether, in determining the benefits afforded by the Bell Atlantic Cash Balance Plan to plaintiff and the Class, it was proper to apply the cash balance transítion factor found in Table 1 of Section 16 of the Cash Balance Plan once rather than twice when calculating the “opening balances,” and if improper, the remedy therefor. Dkt. 61. 13. Young is the class representative for both Subclasses, which taken together are referred to as the “Class.” The Class, consisting of both Subclasses, includes approximately 13,784 former and current management employees of Bell Atlantic and later Verizon. AG ¶ 13. C. The Pension Plans and the Transition to the Cash Balance Plan. 14. The Verizon Management Pension Plan is the successor plan to Verizon’s Bell Atlantic Cash Balance Plan. (PX 206 at VZ432.) Verizon’s Bell Atlantic Cash Balance Plan was the successor plan to the Bell Atlantic Cash Balance Plan (the foregoing are hereinafter referred to as the “Cash Balance Plan” or the “Plan”). The Bell Atlantic Cash Balance Plan is the successor plan to the Bell Atlantic Management Pension Plan (“BAMPP”). (DX 18 at VZ 1053). All of these plans are defined benefit pension plans as defined by ERISA. The effective dates of these plans were as follows: • BAMPP — for decades prior to December 31, 1995 • Bell Atlantic Cash Balance Plan 7/6/96 — effective 12/31/95 • Bell Atlantic Cash Balance Plan 9/3/07 Restatement — effective 12/31/95 • Bell Atlantic Cash Balance Plan— 10/8/98 — effective 1/1/98 • Bell Atlantic Cash Balance Plan 7/6/99 — effective 1/1/98 • Merged Bell Atlantic & Bell Atlantic-North Plan 12/1/99 — effective 1/1/99 • Verizon’s Bell Atlantic Cash Balance Plan 12/31/01 — effective 1/1/99 • Verizon Management Pension Plan 1/1/02 — effective 1/1/02 15. This litigation principally involves the events surrounding the adoption and completion of the Bell Atlantic Cash Balance Plan on July 6, 1996 to replace the BAMPP effective December 31,1995. D. Benefits Under the BAMPP. 16. The BAMPP was the principal pension plan that applied to non-union management employees of Bell Atlantic. (T. 81.) Salaried management employees of Bell Atlantic participated in the BAMPP, a defined benefit pension plan, for decades until December 31, 1995. A participant’s benefit under the BAMPP was expressed in the form of an annuity commencing at age 65. The BAMPP provided that participants who attained specified age and service levels were eligible for a “Service Pension.” (DX 17, BAMPP §§ 4.2-4.3, at VZ 110-12.) The Service Pension permitted an eligible participant to begin receiving an annuity before age 65 without a full actuarial reduction to reflect the early commencement of the participant’s pension. (Id., BAMPP § 4.3, at VZ111-12.) AG ¶ 14. 17. The BAMPP was structured to provide a very significant increase in the value of the benefit once a participant reached a long-term service point, referred to as a “cliff,” which gave an incentive for employees to spend their entire careers with the company. (T. 81.) This took place when the participant became eligible for a Service Pension. (DX 17, BAMPP §§ 4.2-4.4, at VZ 110-13; DX 1 at VZ 10391). 18. Although a participant’s retirement benefit was traditionally paid as an annuity, the BAMPP also included certain “windows,” during which participants could elect to receive their retirement benefits in the form of a one-time lump sum payment, instead of the traditional annuity. (DX 17 at VZ130-32 & VZ133-35, BAMPP §§ 4.16, 4.19.) AG ¶ 15. E. Use of Pension Benefit Guaranty Corporation (“PBGC”) Interest Rate. 19. Section 4.19 of the BAMPP was one such cash-out “window.” It provided for a lump-sum payment (and an accompanying method to calculate that lump-sum) to any vested participant who was an “Active Participant on his Severance from Service Date which occurs on or after December 31,1993 and prior to December 31, 1995.” (DX 17 at YZ133.) 20. The lump-sum formula for those who retired between December 31, 1993, and December 30, 1995 was as follows: (2) Lump-sum Form of Payment. (A) Service Pension Cashr-Outs. The lump-sum payable to a Window-Eligible Employee who is eligible for a Normal or Early Retirement Service Pension shall equal the Actuarial Equivalent present value (calculated using the assumptions in subsection (c)(2)(C)) of the Service Pension otherwise payable to the Participant in the Normal Form commencing on his Annuity Starting Date, as determined under the provisions of the Plan other than this Section 4.19. (B) Deferred Vested Pension Cash-Outs. The lump-sum payable to a Window-Eligible Employee who is eligible for a Deferred Vested Pension shall equal the Actuarial Equivalent present value (calculated using the assumptions in subsection (c)(2)(C)) of the Deferred Vested Pension otherwise payable to the Participant in the Normal Form commencing at Normal Retirement Age (or age at Severance from Service Date, if later), as determined under the provisions of the Plan other than this Section 4.19. (DX 17 at VZ134.) 21. Section 4.19 of the BAMPP uses three assumptions for determining a lump-sum cashout value (DX 17 at VZ134): (a) The discount rate is 120% of the “PBGC interest rate in effect on the last day of the calendar month immediately preceding the first month of the calendar quarter in which the Severance from Service Date occurs.” (DX 17 at VZ134-35); (b) A participant’s expected life span is determined using the “Non-Insured Unisex Pension 1984 (UP84) Mortality Table.” (DX 17 at VZ135); and (c) A participant’s age is to be “years, months and days ... measured as of the 15th day of the middle of the month of the calendar quarter containing the Severance from Service Date, and that age shall be rounded down to a number of whole months.” (Id.) 22. The Court incorporates by reference its discussion of the background facts to the selection of the appropriate Pension Benefit Guaranty Corporation (“PBGC”) interest rate (“Discount Rate Issue”) from its prior decision. Young v. Verizon’s Bell Atlantic Cash Balance Plan, 575 F.Supp.2d 892 at 899-903. 23. Bell Atlantic consistently applied the same PBGC formula under the BAMPP to determine the actuarial equivalent amount, namely “using 120% (or 100% if your cashout is under $25,000) of the Pension Benefit Guaranty Corporation (PBGC) rates that were in effect ...” (T. 170; DX 70 at VZ 10374 for 1993; DX 71 at VZ 10380 for the 1994-95 Cashout Option Period.) 24. In converting the BAMPP to the Cash Balance Plan, Bell Atlantic communicated to its participants that it would con-túrne to use the “same conversion method used in calculating a cashout payment under the old plan.” (DX 1 at VZ10392.) Bell Atlantic sent Estimated Opening Account Balance Statements to each participant in the Cash Balance Plan, which explained in Step 2: Step 2: Your accrued benefit is converted to a lump-sum value applying the same method used today to determine lump-sum cashouts and is based on the PBGC interest rate of 5%. (DX 11 at VZ 10476.) 25. The Cash Balance Plan planning documents also reveal an intention to use the same PBGC methodology as before. In the September 26,1995 memo from Rob Maienshein at Mercer Human Resources Consulting (“Mercer”) to Bell Atlantic, he explains: “The beginning account balance as of 1/1/96 will be determined using the lump-sum cashout value of accrued benefits based on the PBGC graded rate structure with an immediate rate of 5.0% (120% of the rate structure will be used for cash-out values over $25,000) and the UP-84 mortality table.” (DX 5 at VZ10229. See also, 9/27/95 memo from Maienshein, DX 6 at MER4684; 10/22/96 memo from Maien-shein, DX 7 at MER4806.) 26. This formula was consistently applied thereafter. In a memo from Robert Moreen (“Moreen”), the Mercer Partner in charge of the Bell Atlantic assignment, dated November 14, 1997, he reviews the three steps in calculating the initial account balances in the Cash Balance Plan. At step two, he explains: “Determine the lump-sum value of the accrued benefit as of December 31, 1995, using interest (5% PBGC rates, including 120% rates) and mortality (UP-84) assumptions, and calculation procedures, established for use in lump-sum payments from the [BAMPP].” (DX 8 at VZ13307; PX 54 at 238-39.) Moreen testified by means of a deposition. (PX 54.) 27. This formula was made more explicit in the 1998 Cash Balance Plan adopted on October 8, 1998. (DX 31 at 11712-13.) (“... and using the deferred PBGC rates for individuals who were not then eligible for a Service Pension or 120% of the PBGC rate if the present value, using the PBGC rate, is $25,000 or more.”) This clarifying language also appeared in the April 22, 1998 draft of the 1998 Cash Balance Plan. (PX 471 at MLB 547; T. 162-63.) F. The Development of the Transition Factors. 28. In 1994, Bell Atlantic began to consider a new pension plan design. (T. 82.) Bell Atlantic hired Mercer to start from scratch, analyze the current Plan, and come up with a new plan that “employees could believe in and is fair.” (T. 83.) Mercer worked with the Bell Atlantic design team to interview employees, conduct focus groups and to perform an immense amount of statistical analysis to help design a plan consistent with Bell Atlantic’s new business model. (T. 83-84.) Mercer ultimately recommended a cash balance plan with gradually and predictably increasing values, thereby eliminating the “cliffs” present in the BAMPP. (T. 84-85.) One of the big challenges facing Bell Atlantic was to develop a transition formula to fairly treat participants in the BAMPP as they were transitioned to the Cash Balance Plan. (T. 85-87.) 29. Mercer assisted in developing the cash balance formula, including the formula for establishing the opening balances of participants who had previously earned pension benefits under the BAMPP. (T. 83-86; DX 54 at 30.) Mercer also assisted in preparing the specifications for the calculation of the opening balances. Coopers & Lybrand was retained by Bell Atlantic to perform the opening balance calculations. (DX 54 at 102-03, 135-36.) AG ¶ 22. 30. On September 26, 1995, Mercer submitted a memorandum to Bell Atlantic, which included a copy of the plan’s transition factor table and a 15-year projection of liabilities. (DX 5, DX 54 at 213-26.) AG ¶23. The projected liabilities were based on the transition factor being multiplied once, not twice. (DX 54 at 243-44). Mercer’s cover memorandum submitting its final recommendation for the Cash Balance Plan explained that the transition factor was to be multiplied only once by the lump-sum cashout value: The following items should be noted about the calculation of initial cash balance accounts as of January 1, 1996 using the attached recommended final transition tables: The lump sum cash out value is then multiplied by the transition factor provided on the attached transition tables to calculate the actual opening balance under the cash balance plan. (DX 5 at VZ 10229; T. 88-89.) The projected liabilities were predicated on multiplying the transition factor only once. (Id.) 31. On September 27, 1995, Mercer sent Coopers & Lybrand the specifications to calculate the opening balances as of December 31, 1995. (DX 6 at MER4684-85; DX 54 at 102-112, 221-228.) AG¶24. Those specifications provided for multiplying the lump-sum cashout value times the transition factor only once, not twice. (Id.) 32. The transition factors in the table attached to Mercer’s September 26, 1995 memorandum to Bell Atlantic and its September 27 memorandum to Coopers & Lybrand were the same ones used to calculate the actual opening balances in January 1996 and the same ones contained in the tables attached to the July 1996 Cash Balance Plan. (Compare DX 18, 1996 Plan Art. 16, at VZ 1102-03 with DX 5 at VZ 10233-34 and DX 6 at MER 4686-87.) These documents and the related testimony by Moreen, the Mercer Partner in charge of the Bell Atlantic engagement, and Barry Peters, the in-house counsel responsible for drafting the Cash Balance Plan, fully support a finding that Defendants intended to multiply the transition factor only once. (DX 54 at 234-44; T. 88-89.) 33. Mercer created two additional memoranda, dated October 22, 1996, and November 14, 1997, relating to and describing the methodology that had been used to calculate opening balances. (DX 7, DX 8.) AG ¶ 25. Mercer’s description confirmed its continued understanding that the lump-sum cash-out value under the BAMPP had been multiplied only once by the transition factor. (Id.; DX 54 at 234-44.) 34. According to Moreen, during the development of the Cash Balance formula, “the idea of multiplying twice by the transition factor was never once discussed.” (DX 54 at 105-06,125, 243-44.) 35. Multiplying the lump-sum cashout value by the transition factor twice would have “vitiated” the goals that guided the construction of the transition factor table because it would have given participants benefits that were far more valuable than the benefits they could have earned under the BAMPP. (Id., DX 54 at 230-32.) On October 22, 1996, Mercer provided Bell Atlantic with a detailed explanation of how the transition multipliers were developed. (DX 7.) Mercer begins the explanation as follows: the Transition Multipliers were developed in order to provide a smooth transition between the ultimate retirement benefit level of the old Bell Atlantic Management Pension Plan (BAMPP) and the new Bell Atlantic Cash Balance Plan. The Multipliers were developed to be applied to the 12/31/95 lump sum value of the BAMPP accrued benefit producing the opening account balance under the Cash Balance Account. (Id. at MER 4806; DX 54 at 232-37.) G. The Corporate Approval of the Cash Balance Plan Design. 36. Bell Atlantic’s Corporate Employee Benefits Committee (“CEBC”) adopted a resolution in October 1995 authorizing the transition from the BAMPP to the Cash Balance Plan. (DX 3.) AG ¶ 26. The resolution specified that a participant’s opening balance in the Plan would equal “the product of the cashout value of the participant’s accrued benefit on the Effective Date (determined under the existing rules of BAMPP as of 12/31/95) times a transition factor (greater than or equal to 1.0) according to the table presented to this meeting ...” (DX 4 at VZ 1039.) The table presented at the meeting was the Transition Factor table submitted by Mercer in September 1995. (DX 5 at VZ10233-34.) 37. In November 1995 the Human Resources Committee (“HRC”) of Bell Atlantic’s Board of Directors approved the amendment of the BAMPP, effective December 31, 1995, to create the Cash Balance Plan. (DX 4.) AG ¶ 27. H. Pre-Conversion Communications to Participants. 38. Bell Atlantic clearly and consistently communicated to its employees that the transition factor would be multiplied only once in establishing the employees’ opening balances. 39. In or around October 1995, Bell Atlantic created a communication plan relating to the Cash Balance Plan. (PX 431, VZ10534-36.) AG ¶ 28. One of the objectives of the communications plan was to “provide clear understanding of the plan design provisions, while placing special emphasis on the plan’s transition features.” (PX 431 at VZ 10534). The communications plan also called for all management employees who were participants as of 1/1/96 to receive a retirement planning guide in March 1996 “to show employees their plan balances as of 12/31/95.” (Id. at 10535). 40.In October 1995, Bell Atlantic sent all BAMPP participants a brochure entitled “Introducing Your Cash Balance Plan.” (DX 1.) AG ¶ 29. The brochure contains a graph to show the difference between the BAMPP with its “cliff’ and the Cash Balance Plan, which provides steadily growing benefits. (DX 1 at VZ10391.) The brochure described the provisions of the new cash balance formula, including the formula for calculating the opening balances of participants who had earned pension entitlements under the BAMPP. (DX 1.) “Introducing Your Cash Balance Plan” constituted a Summary of Material Modifications (“SMM”) under ERISA § 104(b)(1) and 29 C.F.R. § 2520.104b-3 (2009) because it described material changes in the plan and was “written in a manner calculated to be understood by the average plan participant.” The document was intended to be a SMM and was designed to accurately and visually communicate the summary of changes to the Plan participants. (T. 102-105,182). The SMM used the following formula to show how a participant’s lump-sum cash-out benefit under the BAMPP would be converted to the opening balance under the new Cash Balance Plan: (DX1 at VZ10392.) The SMM also explained the benefit conversion in words: Step 1: Your current pension benefit will be calculated based on your age, service and pay as of December 31, 1995. Step 2: Next, your current benefit will be converted to a lump-sum cash-out value, using the same conversion method used in calculating a cash-out payment under the old plan.... Step 3: Finally, to make sure the new Plan continues to provide you with a fair benefit, your account balance may be increased by multiplying the lump-sum cash-out value determined in Step 2 times a special transition multiplier to arrive at your opening account balance. (Id.) The terms “lump-sum cash out” and “transition multiplier” were defined in the SMM as follows: Lump-Sum Cash Out. Full payment of the value of your cash balance account at one time. Transition Multiplier. A number used to figure your opening account balance in the Cash Balance Plan on January 1, 1996. This number is based on your age and service. Your multiplier may increase your initial account balance to ensure equitable treatment during the transition to the Cash Balance Plan. (Id. at 10386.) 41.The SMM provided hypothetical examples of the impact of “the transition multiplier” on Plan participants. (DX 1 at VZ10393-94.) One example, “Alison,” was a 47 year-old employee with 27 years of Bell Atlantic service on the conversion date. (Id. at VZ10394.) The SMM explained: Her transition multiplier of 2.680 increases her opening account balance so that, together with future pay credits and interest credits, the gap between the old plan and the new Cash Balance Plan will be filled. (Id.) If Bell Atlantic had intended to multiply the transition factor twice, “Alison’s” transition multiplier would have been 7.1824 (2.68 x 2.68), not 2.68, and her opening balance would nearly triple. 42. The SMM also contained the following disclaimer in small print on the back page: “If there is any conflict between the Plan document and this brochure, the text of the Plan document is controlling.” (Id. at VZ10396). 43. In letters to plan participants in October 1995, November 1995 and May 1996, Bell Atlantic repeatedly instructed participants to “please be sure to read” and “please refer to” the SMM, “Introducing Your Cash Balance Plan” (which Bell Atlantic referred to as “the Cash Balance brochure”), for an accurate statement of the Plan’s opening balance and transition factor provisions. (DX10 at VZ10553; DX11 at VZ10476; DX13 at VZ10519.) These documents also contained disclaimers that in the event there were discrepancies between these communications and the Plan, the Plan would govern. (DX11 at VZ10477; DX 13 at VZ10490.) 44. In October 1995, Bell Atlantic prepared a video for BAMPP participants, entitled “Changes,” to describe the transition to the Cash Balance Plan. (DX 10.) AG ¶ 30. In the video, Bell Atlantic explained that the participants would receive a statement with an opening account balance and an explanation of how the transition factor applied to their account. (Id. at VZ 10553.) 45. In November 1995, Bell Atlantic sent estimated “opening account balance” statements to BAMPP participants. (DX 11.) AG ¶ 31. These statements provided each participant with an estimate of his or her opening balance in the Cash Balance Plan, provided a step-by-step description of the opening balance formula, and contained a table of the Plan’s transition factors. (Id. at VZ10475-76.) A sample statement for a 36-year, 9-month old employee with 14 years and 3 months of service as of January 1,1996 stated: STEP 1: Your monthly Age 65 Deferred Pension benefit as a Single Life Annuity estimated at 12/31/1995 is.... $1,520. STEP 2: Your monthly pension converted to a lump-sum cash-out value at 12/31/1995 is.... $35,812. STEP 3: Your lump-sum amount times your transition multiplier of 1.480 is your Estimated Opening Account Balance.... $53,001. (Id. at VZ 10476.) The statement explains that the Step 2 calculation uses “the same method used today to determine lump-sum cash outs and is based on the PBGC interest rate of 5%.” (Id.) I. Implementation of the Cash Balance Plan as of January 1, 1996. 46. Bell Atlantic amended and restated the BAMPP effective December 31, 1995, and changed its name to the “Bell Atlantic Cash Balance Plan.” (DX 3, 4, 18). The Cash Balance Plan expressed a participant’s benefit as a lump-sum balance, to which pay and interest credits were added on a monthly basis. (DX 18, 1996 Plan Art. IV, at VZ 1064-66.) AG ¶ 16. Upon severance from the company, a participant could receive his or her pension benefit as either a lump sum or an annuity. (Id., 1996 Plan, § 5.2, at VZ 1067-68). Bell Atlantic began implementation of the Cash Balance Plan as of January 1,1996, however, the Plan document was not finalized until July 6, 1996. 47. The Cash Balance Plan provided opening balances for each participant. Those opening balances were established for all 13,784 active BAMPP participants retroactive to January 1, 1996. (DX 62). AG ¶ 17. These included 2,271 participants who were already eligible for a Service Pension and 11,513 who were not eligible for a Service Pension. (DX 62). These opening balances were based on their pension entitlement earned under the BAMPP. (DX 18, 1996 Plan § 16.5 at VZ 1100-03; DX 1 at VZ 10392). 48. All of the calculations were performed by multiplying the transition factor only once. Of the 11,513 participants not eligible for a Service Pension, 10,808 had transition factors greater than 1.000. Most of them — approximately 8,600 — had transition factors of 1.5 or higher, and 4,750 had transition factors of 2.000 or higher. The 2,271 Service Pension eligible participants for whom opening balances were established included 762 with transition factors greater than 1.000. (DX51, DX62.) 49. One variable in the calculation of opening balances was the annuity that participants had earned under the BAMPP. (DX 18, 1996 Plan § 16.5 at VZ1100-03; DX 1 at VZ10392). AG ¶ 18. 50. The formula to establish the opening balance consisted of two steps: (1) calculating the lump-sum cashout value of the participant’s annuity under the BAMPP; and (2) multiplying the lump-sum cashout value by a transition factor. (DX 18, 1996 Plan § 16.5.1(a) at VZ 1100; DX 1 at VZ 10392.) The opening balances of the Cash Balance Plan participants thereafter grew through the addition of pay credits and interest credits. (DX 18, 1996 Plan §§ 4.4-4.5 at VZ 1065; DX 1 at VZ10389-90.) 51. The transition factors were designed so that participants who were close to reaching the age and service thresholds for a Service Pension under the BAMPP, and thus were expecting to see an upward spike in the value of their BAMPP accrued benefit, would receive a retirement benefit that approximated the expected cashout value of their Service Pension under the BAMPP. (T. 83-87; DX 1 at VZ 1391-94; DX 7 at MER 4806-09; DX 8 at VZ13307-08.) Transition factors were carried to three decimal places and ranged from 1.000 to 3.105. (DX 18, 1996 Plan Art. 16, at VZ 1102-03.) The applicable transition factor depended on the participant’s age and service. (Id.) Young participants with relatively little service had a transition factor of 1.000. (Id.) The closer a participant was to qualifying for a Service Pension under the BAMPP, the higher the participant’s transition factor. (Id.) For participants 40-46 years old with 16-20 years of service, for example, the transition factors were as follows:_ (Id. at VZ 1102.) Most participants who had already become eligible for a Service Pension under the BAMPP, and had already experienced the upward spike in the value of their BAMPP accrued benefit, had a transition factor of 1.000. (Id. at VZ 1103.) Transition factors were carried to three decimal places and ranged from 1.000 to 3.105 depending on a participant’s age and service. (DX 18, 1996 Plan Art. 16, at VZ1102-03.) AG ¶ 19. 52.Multiplying the transition factors twice, rather than once, for the participants who were not eligible for a Service Pension would have increased their opening balances by $1.67 billion. The opening balances of the 4,750 participants with transition factors greater than 2.000 would have been at least doubled, and in many cases nearly tripled, if their transition factors had been squared. More than 5,780 participants would have received increases in the opening balances of $100,000 or more — increases that would have given them opening balances that exceeded the opening balances of many of the 2,271 participants whose longer service or higher age had already qualified them for a Service Pension. (DX51, DX62.) 53. Young was a salaried employee of Bell Atlantic. As of January 1, 1996, Young was approximately 48 years-old and had 27.8 years of Bell Atlantic net credited service. Her transition factor was 2.659. (DX 14 at Y811.) AG ¶ 20. 54. The average Class member’s years of service at Bell Atlantic as of year-end 1995 was 20 years. (DX at VZ27114-323.) AG ¶ 21. J. Post-Conversion Employee Communications. 55. Following the conversion, Bell Atlantic and Verizon consistently communicated to the participants that the transition factor would be multiplied only once in determining the participant’s opening account balance and the same BAMPP method for determining the lump-sum cash out value was being used in the Cash Balance Plan. 56. In May 1996, Bell Atlantic provided each participant in the Cash Balance Plan with a customized retirement planning guide, “A Look at Your Future Today: Your Retirement Planning Guide.” (DX13.) AG ¶ 32. This guide included a personalized “opening balance” statement setting forth each participant’s actual opening balance calculation. (Id. at VZ 10519.) These actual opening balance statements explained that each participant’s lump sum cash-out value would be multiplied by the applicable transition factor only once. (Id.) The sample page further explains at Step 3: ‘Tour account balance may have been increased by applying a transition multiplier to the lump-sum value of your pension benefit at 12/31/95. Transition multipliers vary by age and service.” (Id.) The Retirement Planning Guide contained the following disclaimer: “If there are any discrepancies between the information in this guide and official Plan documents, the Plan documents will always govern.” (DX 13 at VZ10490.) 57. Starting June 30, 1996, Bell Atlantic sent participants a quarterly statement that, among other information, set forth the participant’s current balance in the cash balance plan. (E.g., DX 15.) AG ¶ 33. By June 30, 1996, Bell Atlantic had completed more than 50,000 separate mailings to participants, each of which made clear that the lump-sum cash out was multiplied by the transition factor just once. (DX1, DX11, DX13.) 58. In August 1996, Bell Atlantic issued a summary plan description for the Cash Balance Plan as part of a document entitled “The Big Picture.” (PX 232 at 678-96.) K. Communications to Plaintiff. 59. There is no evidence that the Plaintiff or any class member ever relied upon the transition factor being multiplied more than once in determining the participant’s opening balance. Prior to this litigation, no class member ever claimed the transition factor was to be multiplied more than once in determining their opening balance. 60. Plaintiff does not assert that she ever reviewed or relied on the mistaken language in the 1996 and 1997 Plans. She never looked at the Plans until 2008, when her lawyers were preparing her for deposition, at which time she merely “glanced” at them. (DX 58 at 84-87.) 61. The 1996 version of the Cash Balance Plan, including appendices, was nearly 150 pages because the Appendix included the BAMPP. (DX17, DX18.) Except in the event of a specific request by a Plan participant, Bell Atlantic did not distribute to participants the restated document containing the erroneous description of the § 16.5.1(a)(2) opening balance formula. (DX9 at VZ10400.) Although Bell Atlantic regularly provided participants with information on how to obtain a copy of the Plan, few requests were received for copies of the Plan document. (DX67 at 11-12.) 62. Plaintiff received from Bell Atlantic and retained in her personal files numerous communications plainly stating that her opening balance would be calculated based on a one-time multiplication by the transition factor. (DX 58 at 28-46.) One of the documents Plaintiff received, reviewed and kept in her files was the October 1995 SMM, “Introducing Your Cash Balance Plan.” (DX 12.) Plaintiff wrote her name on this document and kept it in her files for more than 10 years with other “important” documents relating to her employment. (DX58 at 28-37.) 63. Plaintiff also produced from her files the Estimated Opening Account Balance Statement (“Specially prepared for: Cynthia Young”), which was distributed in November 1995. (DX12.) This document explained the calculation of Plaintiffs opening balance as follows: STEP 1: Your monthly age 65 Deferred Pension benefit as a Single Life Annuity estimated at 12/31/95 is ... $2,160. STEP 2: Your monthly pension converted to a lump-sum cash-out value at 12/31/95 is ... $90,027. STEP 3: Your lump-sum amount times your transition multiplier of 2.659 is your Estimated Opening Account Balance ... $239,381. (Id. at Y842.) 64. Plaintiff produced from her files the May 1996 booklet, “A Look at Your Future Today,” which was sent to her home and described the actual calculation of her opening account balance on January 1,1996 as follows: STEP 1: Your monthly Age 65 Deferred Pension benefit as a Single Life Annuity at 12/31/95 was ... $2,166.70. STEP 2: Your monthly pension converted to a lump-sum cash-out value at 12/31/95 was ... $90,307.16 STEP 3: Your lump-sum amount times your transition multiplier of 2.659 is your Opening Account Balance on 1/1/96 $240,126.74. (DX14 at Y811; DX58 at 48-51). 65. Plaintiff produced from her files the quarterly statements she received showing her Cash Balance Plan Account status at the start of each quarter and the amount it increased through pay and interest credits. (DX15, DX58 at 56-57.) Following her retirement, she cashed out her account in February 1998. (DX 58 at 68, DX15, DX 64.) 66. Squaring the transition factor would have produced balances far greater than the amounts communicated to Plaintiff in November 1995, in May 1996, and quarterly from June 30, 1996 until she cashed out in early 1998. Squaring the transition factor would have increased the estimated opening balance communicated to Plaintiff in November 1995 from $239,581 to $636,516. L. The Actuarial Report. 67. The Plan actuary, Towers Perrin, prepared an actuarial report for the Cash Balance Plan in January 1997, in which Towers Perrin attempted to determine the Plan’s liabilities and assets as of January 1, 1996. (DX16.) AG 51. This report was based on the understanding that the Plan’s opening balances for BAMPP participants were calculated by multiplying each participant’s lump sum cash-out value by the transition factor one time. (Id. at VZ13295-96.) 68. If the opening balances were to be calculated by multiplying each participant’s lump sum cash-out value by the square of the transition factor, the Plan’s liabilities would have increased by at least $1.67 billion above the amount reported by Towers Perrin. (Id. at VZ13263, VZ13270, VZ13274; DX51, DX62.) M. Drafting History of the July 1996 Cash Balance Plan. 69. The drafting history of the Cash Balance Plan demonstrates by clear and convincing evidence that a scrivener’s error and mistake were made in the drafting of the restated Plan document by including two references to the transition factor in § 16.5.1(a)(2) of the Plan. 70. The restated Plan document was finalized on July 6, 1996, and was effective December 31, 1995. (DX 18.) AG ¶35. The restated Plan document was finalized after Bell Atlantic calculated the actual opening balances and communicated them to all 13,784 plan participants. (DX 18.) 71. Barry Peters (“Peters”) joined Bell Atlantic in 1986 to serve as in-house counsel responsible for all ERISA matters and employee benefit issues. (T. 76-80; DX 56 at 13.) Although the Bell Atlantic in-house legal department consisted of over 100 attorneys from 1986-1998, Peters was the only attorney at Bell Atlantic with extensive experience and knowledge of ERISA during that time. (Id.) His duties at Bell Atlantic included preparing governance documentation for the board of directors and its Human Resources Committee regarding all benefit plans, benefits matters, and being the company’s ERISA expert. (DX 56 at 11-14.) Peters left Bell Atlantic in 2001 to work at Mercer Human Resources Consulting until he retired in 2007. (Id. 14-15). Peters testified at trial and by means of two depositions. (T. 73-199, DX 56-57.) 72. Peters was also highly involved in work dealing with compensation and benefits of the corporate executives in mergers and acquisitions that Bell Atlantic engaged in during the 1990s. (T. 78-79; DX 56 at 14.) 73. Peters was the Bell Atlantic employee responsible for coordinating and steering the plan documentation process. (DX 56 at 50.) Peters was located in the Philadelphia headquarters of Bell Atlantic, and he was counsel to the Corporate Employees Benefits Committee (“CEBC.”) (T. 77-78; DX 56 at 12-14, 149.) Peters was “the person authorized by resolutions of the CEBC to maintain and publish the benefits plans adopted and amended by the Committee ...” (PX 219 at VZ14438.) 74. Peters was the only person at Bell Atlantic charged with the responsibility of ensuring that the 1996 Plan conformed to the intent of Bell Atlantic in converting the BAMPP to a cash balance design. (DX 57 at 18-19.) He never assigned anyone else the responsibility to review the plan document in general or the transition rules specifically to avoid drafting errors. (Id. at 19.) AG ¶ 43. 75. The conversion of the BAMPP to the Cash Balance Plan was the single most complicated plan drafting assignment Peters ever faced in his career. (DX 56 at 78:7-25.) It involved converting a decades-old traditional pension plan to a new formula that looked more like a defined contribution plan and reviewing and accounting for numerous intricate additional plan options and amendments. (Id. at 78.) The BAMPP (and the Cash Balance Plan) covered tens of thousands of employees and over $5 billion in liabilities. (VZ22019.) AG ¶ 44. 76. Robert Abramowitz (“Abramow-itz”), a partner in the law firm of Morgan Lewis and Bockius (“Morgan Lewis”) was hired to provide outside legal assistance in the drafting of the Cash Balance Plan. (T. 205-06.) Abramowitz is an expert in ERISA. (T. 204-05; DX 55 at 33-34.) He has been involved in the drafting and amendment of hundreds of employee benefit plans, including 10 to 20 plans that were converted to a cash balance design. (DX 55 at 37). He testified at trial and by deposition. (T. 203-59, DX 55.) 77. Abramowitz was assisted by Kathy Capone, an ERISA paralegal, Vivian McCardell, a senior associate, and Marianne Grey, a benefits analyst. (T. 206-207.) Ms. Capone testified by means of a deposition. (DX 59.) 78. Paul Strella (“Strella”) was a principal at Mercer and an attorney who “knew the law surrounding cash balance plans very well.” (DX 54 at 212; DX 21 at VZ11119.) Strella was the head of the document drafting working group on the team Mercer assembled for the Bell Atlantic cash balance conversion. (PX 222 at MER20675.) 79. Six drafts of the Cash Balance Plan exist. Mercer was engaged to prepare the initial drafts “to have a high level of confidence that it would reflect the design that Mercer had been so intimately involved in.” (T. 57 at 20.) Strella prepared the first three drafts, completing the first in August 1995, the second in September 1995, and the third in October 1995. (T. 90, 93; DX 19, 20, 21; DX 56 at 51-53). The three Mercer drafts express the opening balance formulas for Service Pension eligible and non-Service Pension eligible participants in similar terms, using a single transition factor. (DX 19 at VZ 10804-05; DX 20 at VZ10971-77; DX 21 at VZ11144-45.) AG ¶ 37. The relevant language in the third draft of the Plan prepared by Mercer states: (i) 1995 Active Participants and 1995 Former Active Participants. In the case of a 1995 Active Participant or 1995 Former Active Participant, the opening balance of the Participant’s Cash Balance Account on January 1, 1996 shall be the amount described in (I) or (II) below, as applicable: (I) If, as of December 31, 1995, the Participant was eligible for a Normal Retirement Service Pension or an Early Retirement Service Pension under the 1995 Plan, then the amount described in this paragraph (I) is the present value of the immediate benefit payable commencing on January 1, 1996 under the 1995 Plan, determined as if the participant had retired on December 31,1995, based on Compensation paid through December 31, 1995, or the date of status change to a non-Eligible Employee category, if earlier, multiplied by the applicable transition factor described in Schedule D. (II) In the case of a Participant not described in (I) above, the amount described in this paragraph (II) is the present value as of January 1, 1996 of the Accrued Pension Benefit payable at age 65 under the 1995 Plan, determined as if the Participant had a Severance From Service Date on December 31, 1995, based on Compensation paid through December 31, 1995, or the date of status change to a non-Eligible Employee category, if earlier, multiplied by the applicable transition factor described in Schedule D. (DX 21 at VZ11145 (emphasis added).) 80.Beginning with Draft 4, Mercer was no longer responsible for preparing revisions to the draft plan. (T. 93; DX 56 at 149.) Peters prepared Draft 4 of the Cash Balance Plan, dated April 15, 1996. (T. 95, DX 56 at 53; see also DX 22.) Draft 4 is the first draft of the Plan that contains a second reference to the transition factor in the opening balance formula for nonservice pension eligible participants. (DX 22 at VZ11248.) AG ¶38. 81. The introduction of the second reference to the transition factor in the opening balance formula was a scrivener’s error made by Peters. Peters edited and reorganized the language governing the calculation of the opening balances in an effort to make the text more clear. (DX56 at 73-74; T. 97-100.) As revised, Draft 4 expressed the opening balance as “the product” of one number “times” another, setting off the two components of the opening balance formula with a capital “A” and “B” in parentheses, and with “times” in italics to emphasize that “[y]ou multiply block ‘A’ times block ‘B.’ ” (DX56 at 58-60; 62-64; 73-75.) The draft also made the transition factor a defined term, and highlighted this through the use of initial capitals — “Transition Factor.” (DX56 at 58-59.) Peters’ Draft 4 also reversed the order of the two components of the opening balance formula, placing the more succinctly described term, the Transition Factor, first, so that the “(A) times (B)” structure was more obvious, and used a Bell Atlantic term of art, “lump-sum cashout value” for the other component of the formula. (DX56 at 59, 62-63.) Peters also changed the format of the transition factor table by splitting it in two, with one table for those eligible for a service pension and the other for those not eligible. (DX 22 at VZ 11248.) It was Peters’ practice to perform all drafting and make all changes “on screen on the word processor.” (T. 130-31.) 82. Thus, Peters revised § 4.3.1(a)(1) (the predecessor to Plan § 16.5.1(a)(1)) in draft 4 as follows: 4.3.1(a)(1) If Eligible for Service Pension: If, as of December 31, 1995, the Participant was eligible for a Normal Retirement Service Pension or an Early Retirement Service Pension under the 1995 BAMPP Plan, then the amount described in this paragraph (1) is the product of multiplying (A) the Participant’s applicable Transition Factor described in Schedule C, times (B) the lump-sum cashout value of the immediate annuity benefit under the 1995 BAMPP Plan, determined as if the Participant had retired on December 31, 1995. (DX22 at VZ 11248 (bold emphasis added).) 83. Peters revised § 4.3.1(a)(2) (the predecessor of Plan § 16.5.1(a)(2)) and mistakenly inserted the second reference to the transition factor into the Fourth draft: 4.3.1.(a)(2) Not Eligible for Service Pension: In the case of a Participant who is not eligible for a Service Pension under the 1995 BAMPP Plan as of the Transition Date, the amount described in this paragraph (2) is the product of multiplying (A) the Participant’s applicable Transition Factor described in Schedule D, times (B) the lump-sum cashout value of the Accrued Benefit payable at age 65 under the 1995 BAMPP Plan, determined as if the Participant had a Severance From Service Date on December 31, 1995, based on Compensation paid through December 31, 1995, or the date of status change to a non-Eligible Employee category, if earlier, multiplied by the applicable transition factor described in Schedule C. (DX 22 at VZ11248 (bold emphasis added).) 84. In revising § 4.3.1(a)(2), Peters made a drafting error in one of the most important provisions in the Plan. Working on a word processor, and attempting to make the same revisions in § 4.3.1(a)(2) as he did in § 4.3.1(a)(1), Peters neglected to delete the “trailing clause” at the end of the paragraph, “multiplied by the applicable transition factor described in Schedule C.” (DX22, DX56 at 58-64, 70, 73-75, 78; T. 100-01.) 85. As a result of Peters’ mistake, the formula in § 4.3.1(a)(2) called for the lump sum cashout value to be multiplied by the transition factor twice; rather than once as intended. (DX 22 at VZ11248; T. 100-01.) 86. The Court accepts Peters’ testimony that he made a drafting mistake that was inconsistent with the authorization he was given. (“I made an error ... I failed to delete the words at the very end of the second paragraph.”); (T. 100-01) (“I failed to delete this trailing clause at the end of the paragraph that says ‘Multiplied by the applicable transition factor described in Schedule C.’ I know that’s an error because it’s contrary to the terms of the plan that were approved.... This is the first draft that I had a hands-on role in doing and this is an error that I, therefore, made.”) (DX 56 at 74); (“I believe I made an error that was unintentional and I did not know I made the error.... It was a good faith error which I regret.”); (Id. at 111) (“I never knew of the error that I had made and I never heard anyone tell me that that text problem existed.”) (Id. at 78); (“I was always working electronically so that I could share my work more efficiently with both people in my company and elsewhere, and I must not have seen clearly the words that had been left at the end of that paragraph ... It was unfortunately my own mistake by my own hand.”) (T. 101.) 87. On April 9, 1996, Peters stated in an e-mail memo to Susan McClain, Joseph Ronan Jr., and Gordon Downing at Bell Atlantic and Abramowitz at Morgan Lewis that the Fourth draft “reflects my review and changes of the 3rd draft that had been presented to us by Paul Strella of Mercer.” (PX 226 at VZ11226.) In his e-mail, Peters asked McClain to review the document and “share it with Kwasha Lipton [the company performing the intricate computer programming to calculate the benefits], to make sure they review it with an eye to assuring that it accurately reflects the mechanics and programming that has been built into the administration of the plan.” (Id.) Peters noted in his email that Abramowitz and Grey, his paralegal, were “standing by to assist in finalizing the drafting process, and assisting us with the eventual submission of the document to the IRS.” (Id.) He also instructed Abramowitz “not to begin any revision work until you [McClain] and Kwasha have had a chance to make any changes to fix any problems that you find.” (Id.) Finally, Peters noted that one of the “pieces that still remain to be completed” was “physically moving” the transition-related provisions “to a Section at the back of the plan that is solely devoted to transition rules.” (Id.) 88. Abramowitz reviewed the Fourth draft and made written notes on the document. (T. 223-25; PX 225 at VZ11248.) Significantly, he underlined a portion of the sentence immediately preceding the second transition factor reference in Section 4.3.1(a)(2). (Id.) He clearly read this entire paragraph but did not notice an error. (T. 225.) Abramowitz understood that responsibility for the transition factors rested with Mercer and Bell Atlantic. (T. 215.) 89. Peters was negligent in failing to notice and correct the scrivener’s error in the Fifth draft. Like the Fourth draft, the Fifth draft of the Cash Balance Plan contains a second reference to the transition factor in Section 4.3.1(a)(2). (PX 227 at VZ11379.) The changes suggested by Abramowitz in Section 4.3.1(a)(2) were made and blackline versions were prepared. (PX 228 at VZ11447.) Changes were noted immediately before and immediately after the second reference to the transition factor. (Id.) 90. Peters also prepared the Fifth draft dated June 6, 1996 (DX 23), which he sent to Marianne Grey, a benefits analyst at Morgan Lewis, on June 7, 1996. (PX228 at VZ 11446-47.) AG ¶ 39. The “blackline” version of the Fifth draft shows that Peters: (1) changed the first transition factor reference from “described in Schedule D” to “described in Schedule C,” (2) immediately before the second reference to the transition factor, he deleted the text “or the date of status change to a non Eligible Employee category, if earlier,” and (3) immediately after the second reference to the transition factor, he added the sentence “For a 1995 Former Active Participant, the date on which the individual ceased to be an Eligible Employee shall be substituted for December 31, 1995 in the last phrase of the previous sentence.” (PX 228 at VZ11446-47.) Despite all of the changes made immediately before and immediately after the second reference to the transition factor, Peters claims no one brought the issue of the second transition factor to his attention. (T. 140-41; PX 228 at VZ11446-47.) Peters made approximately 240 changes to the Fourth draft in preparing the Fifth draft. (T. 133.) 91. Specifically, Section 4.3.1(a)(2) of the blackline version of the Fifth draft reads as follows: 4.3.1(a)(2) Not Eligible for Service Pension In the case of a Participant who is not eligible for a Service Pension under the 1995 BAMPP Plan as of the Transition Date, the amount described in this paragraph (2) is the product of multiplying (A) the Participant’s applicable Transition Factor described in Schedule D C times (B) the lump-sum cashout value of the Accrued Benefit payable at age 65 under the 1995 BAMPP Plan, determined as if the Participant had a Severance From Service Date on December 31, 1995, based on Compensation paid through December 31, 1995, or the date of status-change to a non-Eligible Employee category, if earlier, multiplied by the applicable transition factor described in Schedule C. For a 1995 Former Active Participant, the date on which the individual ceased to be an Eligible Employee shall be substituted for December §1, 1995 in the last phrase of the previous sentence. (PX 228 at VZ11446-47.) (Emphasis added.) 92. In a handwritten note to Grey on the cover of the blaeklined version of the Fifth draft, Peters noted that “[t]his is blaeklined to show changes from the prior draft that you and Bob reviewed and commented on.” (PX 228 at VZ11423.) Peters’ handwritten note asks Grey to print a copy for Abramowitz. (Id.) 93. On or around June 7, 1996, Peters asked Abramowitz to execute the “physical move” of the transition rules to a separate section at the back of the Cash Balance Plan. (PX 448, DX 55 at 132-33.) Peters did not expect Morgan Lewis to review the transition factor formula. (T. 143.) 94. On July 1, 1996, Abramowitz sent a Sixth draft of the Cash Balance Plan to Peters. (DX 24.) This was the first draft prepared by Morgan Lewis. (T. 229.) As Peters requested, the cash balance transition provisions were moved to a separate section, Appendix B, in the Sixth draft. (DX 24 at VZ11561-68.) The Sixth draft also includes the second reference to the transition factor. (Id. at VZ11565.) Abra-mowitz does not recall anyone at Morgan Lewis ever bringing the second transition factor reference to his attention. (T. 225-26.) 95. The Sixth draft is dated 6/25/96. (DX 24 at VZ11505.) Abramowitz noted in his cover letter to the Sixth draft his understanding that “your [Peters’] office will take care of blacklining the document.” (Id. at VZ11503.) He also noted that “[t]he majority of our changes are self-explanatory or have been previously discussed with you.” (Id. at VZ 11503.) 96. Peters used the Sixth draft to create a final plan document entitled “Bell Atlantic Cash Balance Plan Effective December 31, 1995 (7/6/96 edition)” (DX 18 at VZ 1046-1106) (the “1996 Plan”). AG ¶ 41. Peters finalized the 1996 Plan at his office in Bell Atlantic’s corporate headquarters in Philadelphia, Pennsylvania, on July 6, 1996. (DX 56 at 149.) 97. In the 1996 Plan, Appendix B of the Sixth draft was moved to a new § 16, entitled December 31, 1995 Transition Plan, but § 16.5.1(a)(2) of the 1996 Plan is substantially the same as Section 3.2.1(a)(2) of Appendix B of the Sixth draft. (T. 135-36.) 98. The final, adopted version of §§ 16.5.1(a)(1) and (a)(2) state: 16.5.1(a)(1) If Eligible for Service Pension If, as of December 31, 1995, the Participant was eligible for a Normal Retirement Service Pension or an Early Retirement Service Pension under the 1995 BAMPP Plan, then the amount described in this paragraph (1) is the product of multiplying (A) the Participant’s applicable Transition Factor described in Table 2 of this Section, times (B) the lump-sum cashout value of the immediate annuity benefit under the 1995 BAMPP Plan, determined as if the Participant had retired on December 31, 1995, ignoring any compensation paid after the date of the last paycheck for salary earned in December 1995. For a 1995 Former Active Participant, the date on which the individual ceased to be an Eligible Employee shall be substituted for December 31, 1995 in the last phrase of the previous sentence. 16.5.1(a)(2) Not Eligible for Service Pension In the case of a Participant who is not eligible for a Service Pension under the 1995 BAMPP Plan as of the Transition Date, the amount described in this paragraph (2) is the product of multiplying (A) the Participant’s applicable Transition Factor described in Table 1 of this Section, times (B) the lump-sum cashout value of the Accrued Benefit payable at age 65 under the 1995 BAMPP Plan, determined as if the Participant had a Severance From Service Date on December 31, 1995, based on Compensation paid through December 31, 1995, multiplied by the applicable transition factor described in Table 1 of this Section. For a 1995 Former Active Participant, the date on which the individual ceased to be an Eligible Employee shall be substituted for December 31, 1995 in the last phrase of the previous sentence. (DX 18 at VZ 1100) (emphasis added). This was a key provision for anyone who had an opening cash balance. (T. 236.) According to Abramowitz, this provision on a scale of 1 to 10 ranks as a 10 in terms of importance. (Id.) 99.In practice, the CEBC and the HRC never reviewed plan documents to ensure they were consistent with Bell Atlantic’s intent. (DX 57 at 17-18.) It was primarily Peters’ responsibility to ensure that final plan documents were consistent with Bell Atlantic’s intent. (Id. at 18.) Bell Atlantic did not have a practice of executing its final plan documents.