                          RECOMMENDED FOR FULL-TEXT PUBLICATION
                               Pursuant to Sixth Circuit Rule 206
                                       File Name: 12a0281p.06

                 UNITED STATES COURT OF APPEALS
                                   FOR THE SIXTH CIRCUIT
                                     _________________


                                             X
                                              -
 ROBERT H. FALLIN; CHARLES JOHNSON;
                                              -
 CLAUDETTE LOGSDON; JOSEPH G.
 RUSSELBURG; CLARENCE E. SIMON, JR.;          -
 WILLIAM M. GILMORE; ERIC CLARK; STEVE J. -
                                                                   No. 09-5139

                                              ,
                                               >
                      Plaintiffs-Appellants, -
 SMITH; DONALD CORLEY,

                                              -
                                              -
                                              -
          v.
                                              -
                                              -
                                              -
 COMMONWEALTH INDUSTRIES, INC. CASH
                                              -
 BALANCE PLAN; BENEFITS COMMITTEE FOR
                                              -
 THE COMMONWEALTH INDUSTRIES, INC.
 CASH BALANCE PLAN,                           -
                     Defendants-Appellees, -
                                              -
                                              -
                                              -
 COMMONWEALTH INDUSTRIES, INC.,
                                 Defendant. N
                        Appeal from the United States District Court
                     for the Western District of Kentucky at Louisville.
                    No. 3:07-CV-196—John G. Heyburn, District Judge.
                                      Argued: May 30, 2012
                             Decided and Filed: August 23, 2012
   Before: SILER and KETHLEDGE, Circuit Judges; GRAHAM, District Judge.*

                                       _________________

                                             COUNSEL
ARGUED: Michael D. Grabhorn, GRABHORN LAW OFFICE, PLLC, Louisville,
Kentucky, for Appellants. Keith Louis Pryatel, KASTNER, WESTMAN & WILKINS,
LLC, Akron, Ohio, for Appellees ON BRIEF: Michael D. Grabhorn, GRABHORN
LAW OFFICE, PLLC, Louisville, Kentucky, for Appellants. Keith Louis Pryatel,
Kenneth Michael Haneline, KASTNER, WESTMAN & WILKINS, LLC, Akron, Ohio,
for Appellees.


         *
           The Honorable James L. Graham, United States District Judge for the Southern District of Ohio,
sitting by designation.


                                                   1
No. 09-5139     Fallin, et al. v. Commonwealth Indus. Cash Balance Plan, et al.       Page 2


                                   _________________

                                        OPINION
                                   _________________

        KETHLEDGE, Circuit Judge. Plaintiffs are retirees who received benefits under
Commonwealth Industries’ pension plan. They allege that the Plan underpaid them, in
violation of the Employee Retirement Income Security Act, when it did not include a
subsidy for early retirement in its benefit calculations. In separate orders, the district
court first dismissed the claims of all but one plaintiff on limitations grounds, and later
granted summary judgment to the defendants on the claims of the remaining plaintiff,
Donald Corley. We affirm the first order and vacate the second.

                                             I.

        Until 1998, Commonwealth had a traditional defined-benefit pension plan. The
Plan allowed employees to retire early once they had completed five years of service and
reached age 55. Employees taking that option would receive subsidized benefits:
monthly payments beginning immediately that were nearly as large as (and, in the case
of those age 62–65, the same as) those they would have received if they were 65.

        By 1998, all nine plaintiffs had performed five years of service, but none had
reached age 55. That year, Commonwealth converted its plan into a cash-balance plan,
which replaced defined-pension benefits with hypothetical individual accounts. The
initial balance of each account was the value of the benefits the participant had accrued.
Plaintiffs allege, however, that the Plan failed to give them the full value of their accrued
benefits. Specifically, they say the Plan did not give them credit for the value of the pre-
amendment early-retirement subsidy, which they allege was more generous than the one
that replaced it.

        After the conversion, Plaintiffs retired, electing to take their benefits in the form
of single lump-sum payments. Plaintiff Corley received his payment on March 1, 2002,
when he was age 55. Less than five years later, Corley filed an administrative claim to
challenge the amount of the payment. The other eight plaintiffs each filed similar claims
No. 09-5139    Fallin, et al. v. Commonwealth Indus. Cash Balance Plan, et al.       Page 3


more than five years after receipt of their payments. Plaintiffs lost their administrative
appeals and sued under 29 U.S.C. § 1132(a)(1)(B), alleging that ERISA’s terms, which
the Plan incorporated, entitled them to additional benefits.

        The district court dismissed eight of the plaintiffs’ claims, finding them time-
barred. It found Corley’s claim timely, but rejected the claim on the merits. The court
reasoned that, as of 1998, Corley was not yet entitled to his early-retirement subsidy
because he was then not yet 55. Thus, the court held, the early-retirement benefit had
not accrued yet, and the Plan amendment did not reduce any accrued benefit.

                                            II.

                                            A.

        Plaintiffs argue that the district court erred in holding that the statute of
limitations barred the claims of eight plaintiffs under § 1132(a)(1)(B). In doing so, the
court applied what it thought was “the most analogous state law statute of limitations.”
Redmon v. Sud-Chemie Inc. Retirement Plan for Union Employees, 547 F.3d 531, 534
(6th Cir. 2008) (internal quotation marks and citations omitted). We review its decision
de novo. Id.

        The district court held that the closest analog here was Kentucky Revised
Statutes § 413.120(2), which provides a five-year limitations period for “[a]n action
upon a liability created by statute, when no other time is fixed by the statute creating the
liability.” Thus, in order to be timely, Plaintiffs’ causes of actions must have accrued
within five years of when they filed suit (unless they were entitled to tolling). An
ERISA cause of action accrues “when a fiduciary gives a claimant clear and unequivocal
repudiation of benefits.” Redmon, 547 F.3d at 538 (internal quotation marks omitted).
The district court held that the Plan’s payment of a single lump sum represented the
Plan’s determination of all the benefits that each plaintiff was entitled to receive, and
thus unequivocally repudiated any claim to additional benefits. Those payments
occurred more than five years before eight of the plaintiffs began the administrative
process, so the district court held that their claims were time-barred.
No. 09-5139    Fallin, et al. v. Commonwealth Indus. Cash Balance Plan, et al.     Page 4


       In Redmon, our court expressly adopted the reasoning and holding of the district
court in this very case.       See 547 F.3d at 536–38.       And the claims here are
indistinguishable from those in Redmon. There, we held that, when a plaintiff seeks
“benefits under the plan” and those claims depend on “alleged violations of ERISA’s
statutory protections,” Kentucky’s five-year limitations period applies. Id. at 537.
Under Redmon, therefore, the district court was correct to hold that the claims of eight
plaintiffs were time-barred.

                                           B.

       The district court also held that the claim of the remaining plaintiff, Corley, was
timely. The court reasoned that the claim was equitably tolled while he pursued
administrative remedies. Corley received his lump-sum payment roughly five years and
one month before he filed suit, but he spent more than two months of that time pursuing
administrative remedies. The district court held that Kentucky would permit tolling
while a plaintiff exhausts his administrative remedies, so long as he begins the
administrative process within the statute of limitations. In Redmon, our court endorsed
this aspect of the district court’s holding. Id. at 539 n.9. We do so again here. Common
sense suggests that we should encourage plaintiffs to pursue their administrative
remedies before coming to court with the dispute—and indeed we sometimes require
them to do so. See, e.g., Hill v. Blue Cross and Blue Shield of Mich., 409 F.3d 710, 717
(6th Cir. 2005). Moreover, Kentucky courts routinely allow tolling while plaintiffs
exhaust their administrative remedies. See, e.g., Tyler v. Taylor, 128 S.W.3d 495, 497
(Ky. Ct. App. 2004) (limitations period tolled while inmate pursues grievance
procedures). The district court was therefore correct to hold that Corley’s claim was not
time-barred.
No. 09-5139    Fallin, et al. v. Commonwealth Indus. Cash Balance Plan, et al.     Page 5


                                           III.

                                           A.

       Turning to the merits, Corley argues that the current Plan language, independent
of any ERISA requirements, entitles him to the value of his pre-amendment early-
retirement subsidy. The Plan provides a default early-retirement benefit equal to “the
amount of the Normal Retirement Benefit . . . reduced by 5/12 of 1% for each month”
that the participant is younger than 62. The benefit cannot “be less than the Actuarial
Equivalent of the Participant’s Accrued Benefit.” The Plan defines “Accrued Benefit”
as “[t]he benefit to which the Participant would be entitled under the Normal Form
commencing at age 65 and computed under the provisions of Section 4.1[,]” which
defines the Normal Retirement Benefit. Corley interprets these provisions to mean that
the Plan was required to pay him the value of the pre-amendment early-retirement
subsidy.

       Here, the Benefits Committee has discretion in interpreting the Plan. Thus, we
will overturn the Committee’s interpretation only if it is arbitrary or capricious. See
Price v. Bd. of Trs. of the Ind. Laborer’s Pension Fund, 632 F.3d 288, 295–96 (6th Cir.
2011). The Committee interpreted the Plan’s early-retirement provisions to mean that
a participant would get early-retirement benefits calculated according to the default
formula, unless the default provided less than an actuarial equivalent of the benefits he
would get if he waited until normal retirement age. This interpretation flows naturally
when one reads the provisions together. Moreover, the Treasury Department has
promulgated a regulation that leads to the same conclusion. See 26 C.F.R. § 1.411(a)-
11(a)(2). It gives plans two options: If a plan specifically provides that the lump-sum
payment “is the present value of the subsidized early retirement annuity benefit[,]” then
the plan must include the value of the early-retirement subsidy in the payment. Id. But
if a plan instead defines the early-retirement benefit as “the present value of the normal
retirement annuity benefit”—which is what this plan does—then it need not include the
subsidy. Id. The Benefits Committee’s interpretation comported with this regulation
No. 09-5139    Fallin, et al. v. Commonwealth Indus. Cash Balance Plan, et al.      Page 6


and was not arbitrary or capricious. See generally Rybarczyk v. TRW, Inc., 235 F.3d
975, 983 (6th Cir. 2000).

                                            B.

       Corley also argues that the Committee’s calculation of his lump-sum payment
violated an ERISA provision known as the anti-cutback rule. With exceptions not
applicable here, that rule provides that a plan amendment shall not decrease a
participant’s “accrued benefit.” 29 U.S.C. § 1054(g). Corley contends that the
Committee paid him an early-retirement benefit that was less than he would have
received under the pre-amendment Plan, thereby reducing his accrued benefit. The
district court disagreed. We review its reading of § 1054(g) de novo. See Daft v. Advest,
Inc., 658 F.3d 583, 594–95 (6th Cir. 2011).

       The district court reasoned that a benefit accrues only after a participant has met
all of the plan’s criteria for that benefit. See 29 U.S.C. § 1002(23)(A); Cattin v. General
Motors Corp., 955 F.2d 416, 423 (6th Cir. 1992). Here, before the Plan amendment,
Corley satisfied one criterion for the early-retirement benefit—that he have five years
of credited service. But he did not meet the other—that he reach age 55—until after the
amendment (although he did satisfy this condition before he retired). He argues that his
early-retirement benefit was accrued nonetheless under § 1054(g).

       That subsection provides:
       (g) Decrease of accrued benefits through amendment of plan
               (1) The accrued benefit of a participant under a plan may not be
               decreased by an amendment of the plan, other than an
               amendment described in section 1082(d)(2) or 1441 of this title.
               (2) For purposes of paragraph (1), a plan amendment which has
               the effect of—
                       (A) eliminating or reducing an early retirement benefit or
                       a retirement-type subsidy (as defined in regulations), or
                       (B) eliminating an optional form of benefit,
               with respect to benefits attributable to service before the
               amendment shall be treated as reducing accrued benefits. In the
No. 09-5139     Fallin, et al. v. Commonwealth Indus. Cash Balance Plan, et al.       Page 7


                case of a retirement-type subsidy, the preceding sentence shall
                apply only with respect to a participant who satisfies (either
                before or after the amendment) the preamendment conditions for
                the subsidy.
29 U.S.C. § 1054(g) (emphasis added).

        Here, Corley had more than five years of service before the Plan was amended
in 1998. The subsidy he seeks was therefore “attributable to” his “service before the
amendment.” Id. § 1054(g)(2); compare Cattin, 955 F.2d at 423–24 (anti-cutback rule
did not apply where plaintiffs sought benefits attributable in part to service after the plan
amendment). And though Corley had not satisfied the age requirement by that time, the
statute allows him to do so “either before or after the amendment[.]” 29 U.S.C.
§ 1054(g)(2).     Thus, in summary, early-retirement “benefits attributable to pre-
[amendment] service remain inviolate whether the age condition be satisfied ‘before or
after the amendment[.]’” Rybarczyk, 235 F.3d at 983 (ellipses omitted).

        Rybarczyk controls here. That Corley satisfied the service condition before the
plan was amended, and the age condition afterward, was enough for his subsidy to be
accrued. Under the anti-cutback rule, therefore, the Plan could not reduce that benefit.

        As a factual matter, however, it is not clear that the Plan actually reduced
Corley’s benefits. Neither party has explained to us the calculations the Plan was
supposed to perform or those it did perform.             Indeed, in rejecting Plaintiffs’
administrative claims, the Benefits Committee told Plaintiffs that they did not “provide
sufficient detail for the Benefits Committee to fully understand their assertion that the
early retirement factors are incorrect.”

        On remand, the district court should consider whether the benefits payable to
Corley under the relevant versions of the Plan constituted “an early retirement benefit”
or “a retirement-type subsidy” which would be protected from elimination or reduction,
or “an optional form of benefit” which would only be protected from elimination. See
29 U.S.C. § 1054(g)(2)(A), (B). To the extent that Corley may be seeking separately
calculated benefits under former versions of the Plan in addition to the benefits payable
No. 09-5139    Fallin, et al. v. Commonwealth Indus. Cash Balance Plan, et al.       Page 8


under the Plan in effect at the time of his retirement, the district court should be mindful
of the risk of double counting his early-retirement benefits.

                                         *   *   *

        We affirm the district court’s November 9, 2007 order dismissing the claims of
all plaintiffs but Corley. We vacate the court’s December 2, 2008 order regarding
Corley’s claim, and remand the case for further proceedings consistent with this opinion.
