Labor & Employment Law Daily Wrap Up, PENSION AND BENEFIT PLANS—N.D. Okla.: ERISA plan participant was properly denied severance benefits after voluntary resignation, (Dec 12, 2025)

By Steven D. Cole, J.D.

A full and fair review of the employee’s claim resulted in the conclusion that he did not qualify for severance benefits under the terms of the plan.

The Plan Administrator and Appeals Committee correctly determined that an employee’s voluntary resignation divested him of his entitlement to receive severance benefits under the company’s Change in Control Severance Plan (Plan), held a federal district court in Oklahoma. The employee, a former Lead Accountant for Cimarex Energy Company maintained that he was due severance benefits under the Plan based on the company’s decision to transfer the Accounting Department from Tulsa to Houston following a merger. However, there was substantial evidence supporting the Appeals Committee’s conclusion that the employee was not, in fact, required to move. Thus, the Plan’s clause on which the employee relied was not triggered (Bessinger v. Cimarex Energy Co., No. 23-cv-00452-SH (N.D. Okla. Dec. 8, 2025)).

Company merger. In May 2021, the employer communicated to its employees that it would be merging with another entity on October 1, 2021. Because this move would entail relocating the Tulsa Accounting Department, the employer inquired as to its employees’ willingness to move to Houston. The employee averred that he spoke to his managers on numerous occasions in December 2021 and February 2022 to discuss his plan to transition to a different company. He formally requested benefits under the Severance Plan on March 3, 2022, and officially resigned the following day.

Severance plan. The section of the Plan at issue entitles participants to severance benefits if, within two years after a change in control of the company, (a) the employer terminates a participant for any reason other than cause, death, or disability, or (b) the participant resigns for “good reason” within 120 days after having knowledge of such reason. The Plan specifies that “good reason” includes the employer “requiring the [p]articipant to relocate his or her principal place of business to another metropolitan area which is more than 50 miles from his or her previous office location.” The Vice President of Human Resources for Cimarex served as the Plan Administrator, with full discretionary authority to interpret and administer the Plan.

Request for benefits denied. The Plan Administrator denied the employee’s request for benefits on May 3, 2022, citing the employee’s voluntary resignation “in order to take a job with another company.” The employee appealed this decision, invoking the Plan’s “good reason” clause. On July 27, 2022, the Appeals Committee denied the appeal. Taking into consideration the facts alleged by the employee and the terms of the Plan, the Appeals Committee reasoned that at no time was the employee “required” to move to Houston.

The Appeals Committee weighed heavily the fact that in late 2021, all remaining Tulsa accounting employees were informed that they needed to complete the transition of the Accounting Department to Houston and were expected to continue their employment in Tulsa through the first quarter of 2023; and that, on February 3, 2022, the employee’s manager informed him that he would not be eligible for severance benefits under the Plan if he resigned.

ERISA claim. The employee filed suit in federal district court, arguing that Cimarex violated ERISA by arbitrarily and capriciously denying his request for benefits. The court, in examining the administrative record, held that there was substantial evidence supporting Cimarex’s decision and very little evidence lending support to the employee’s assertion of entitlement.

The Plan unambiguously stated that in order for a participant to have “good reason” to resign based on relocation, the company must require the participant to relocate. Cimarex did not, however, tell the employee that he needed to move his principal place of business to Houston; instead, the employer asked if he was willing to move there, with the common understanding that, eventually, there would be no more accounting jobs in Tulsa. Even if the Plan was ambiguous about the timing of a relocation, it was reasonable for Cimarex to interpret this to mean that the requirement to relocate was not triggered until the transition was complete, and because the employee submitted his resignation before this occurred, the “good reason” clause did not apply.

The employee’s arguments were not persuasive. First, the employee asserted that there was no basis in the written record for finding that employees like him were informed that they would be needed as “transition employees” until the first quarter of 2023. This was irrelevant, though, since the employee knew that Cimarex was still employing him at the time he tendered his resignation. It was worth noting that, under the terms of the Plan, the employee would have been entitled to the benefits he sought had he continued his employment with the company and been terminated within two years of the October 2021 change in control. “This prospect of future termination was not a ‘Good Reason’ allowing for an employee to choose an earlier date for self-termination and then receive benefits,” according to the court.

Arbitrary and capricious decision. The employee also contended that the employer’s denial was arbitrary and capricious because others in similar circumstances were awarded benefits under the Plan. However, substantial evidence in the record supported the Appeals Committee’s finding that these employees were differently situated because they were actually terminated by Cimarex.

Finally, while the court acknowledged that there was an inherent conflict of interest present in that the Plan Administrator was employed by Cimarex, there was not enough evidence to find that Cimarex abused its discretion when it chose to deny the employee’s requested benefits.

The case is No. 23-cv-00452-SH.

Judge: Huntsman, S.

Attorneys: Mark Allen Smith (Caruso & Smith, PLLC) for Jay Bessinger. Christopher S. Thrutchley (GableGotwals) for Cimarex Energy Co.

Companies: Cimarex Energy Co.

Cases: PensionBenefitPlans WageHour OklahomaNews