Ex-21st Century Fox VP Wins Severance for Disney Merger Job Loss

A former Twenty-First Century Fox Inc. vice president who says she was fired after declining to switch jobs following a merger with Walt Disney Co. is entitled to severance benefits, a California federal judge ruled.

The Disney severance plan administrator abused its discretion by failing to address or credit Bernadette Paine’s evidence suggesting that her 2019 termination was involuntary, Judge Virginia A. Phillips of the US District Court for the Central District of California held Tuesday. And the administrator can’t argue in court that it properly considered this evidence, because it didn’t explain that to Paine in the course of denying her claim for benefits, Phillips said.

“Having failed to provide Plaintiff with sufficient reasons for its denial of benefits during the administrative process, the Plan Administrator is foreclosed from asserting them now,” Phillips said, awarding Paine summary judgment on her claim for wrongly denied benefits under the Employee Retirement Income Security Act.

However, Phillips ruled for the defendants on Paine’s claims for fiduciary breach and breach of contract, in part because Paine lacked standing to press these claims.

Paine began working at Fox as the vice president of worldwide marketing strategy and communications in 2018. Shortly after Fox merged with Disney in 2019, Disney asked whether she would accept another role in its Burbank, Calif., office.

Paine declined, and says she was then told her “employment will be separated” in July of 2019. She was later denied severance on the grounds that her termination had been voluntary and due to “personal circumstances,” as the position she declined wasn’t located more than 50 miles from her primary place of employment.

In prior rulings, Phillips allowed Paine to advance breach of contract and ERISA claims.

Garofolo & Ramsdell LLP represents Paine. Trucker Huss APC represents the defendants.

The case is Paine v. Inv. & Admin. Comm. of Walt Disney Co. Sponsored Qualified Ben. Plans, C.D. Cal., No. 2:20-cv-08610, 9/27/22.