Groden v. N&D Transportation Co., Inc. , 866 F.3d 22 ( 2017 )

United States Court of Appeals
For the First Circuit
No. 15-2553
EDWARD F. GRODEN, FUND MANAGER OF THE NEW ENGLAND TEAMSTERS AND
TRUCKING INDUSTRY PENSION FUND,
Plaintiff, Appellant,
v.
N&D TRANSPORTATION COMPANY, INC.; LAURENT J. DUHAMEL;
ELIZABETH A. DUHAMEL; JED REALTY ASSOCIATES, LLC,
Defendants, Appellees.
APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MASSACHUSETTS
[Hon. Rya W. Zobel, U.S. District Judge]
Before
Torruella, Lipez, and Barron,
Circuit Judges.
Melissa A. Brennan, with whom Catherine M. Campbell and
Feinberg, Campbell & Zack, PC were on brief, for appellant.
Oleg Nikolyszyn for appellees Laurent J. Duhamel and
Elizabeth A. Duhamel.
Robert A. Mitson, with whom Mitson Law Associates was on
brief, for all appellees.
August 2, 2017
LIPEZ, Circuit Judge. In this appeal, we consider
whether the Supreme Court's decision in Peacock v. Thomas, 516
U.S. 349 (1996), requires dismissal of a pension fund's lawsuit
against an employer's alleged alter egos. Specifically, we must
decide whether there is federal subject matter jurisdiction for
the fund's suit seeking $1.2 million in unpaid withdrawal liability
that previously was assessed against the employer in a default
judgment. The pension fund's manager, appellant Edward F. Groden,
maintains that subject matter jurisdiction exists under the
Employee Retirement Income Security Act of 1974 ("ERISA").
Concluding otherwise, the district court dismissed the case and
subsequently denied appellant's motion for post-judgment relief.
Having carefully reviewed the law and the fund's allegations, we
vacate the court's post-judgment ruling and remand the case for
further proceedings.
I.
A. Background
In September 2012, the New England Teamsters and
Trucking Industry Pension Fund ("the Fund") secured a default
judgment in federal court against D&N Transportation, Inc. ("D&N")
for unpaid withdrawal liability the company owed, pursuant to ERISA
as amended by the Multiemployer Pension Plan Amendments Act
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("MPPAA"), when it ceased operations.1 See 29 U.S.C. §§ 1132(e);
1381; 1451.2 Defendants Laurent and Elizabeth Duhamel ("the
Duhamels"), who are husband and wife, were D&N's sole stockholders
during the company's forty-odd years in business. Eighteen months
after the default judgment, with no payments having been made, the
Fund filed a new complaint -- i.e., this action -- against the
Duhamels, N&D Transportation, Inc. ("N&D"), and JED Realty
Associates, LLC ("JED Realty"), seeking to hold them liable for
the withdrawal liability.
1 The action was filed on behalf of the Fund by its then
manager, Charles Langone, who was later succeeded in that position
by Edward F. Groden. In September 2016, we granted Langone's
assented-to motion to substitute Groden as plaintiff-appellant in
this appeal. For convenience, we refer to appellant as "the Fund."
2 We borrow the Ninth Circuit's explanation of withdrawal
liability:
ERISA, which was enacted in 1974, was intended
to protect employees covered by pension plans
from being deprived of anticipated benefits
because of employer underfunding. When it
turned out to do so inadequately, MPPAA was
enacted in 1980 to reduce an employer's
incentive to terminate its affiliation with a
multiemployer pension plan by requiring
employers who do withdraw to pay the unfunded
vested benefits attributable to the
withdrawing employers' participation.
Resilient Floor Covering Pension Fund v. M&M Installation, Inc.,
630 F.3d 848, 851 (9th Cir. 2010); see also Sun Capital Partners
III, LP v. New Eng. Teamsters & Trucking Indus. Pension Fund,
724 F.3d 129, 138 (1st Cir. 2013).
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The Fund claimed, inter alia, that the Duhamels and N&D,
a corporation owned by their two children (Nancy Belsito and David
Duhamel), are alter egos of D&N and, accordingly, are equally
responsible for the unpaid ERISA obligation. The Fund also alleged
that JED Realty, another business owned by David Duhamel, is an
alter ego of N&D and, as such, is likewise responsible for the D&N
debt. In support of its alter ego contentions, the Fund asserted,
inter alia, that the operations of D&N and N&D overlapped in
significant respects, including use of the same office space and
telephone number, joint insurance coverage, linked bank accounts,
and shared employees.3 Put simply, the Fund alleges that D&N and
N&D were, in practical effect, the same entity, with "common
ownership, management, business purpose, customers, employees and
operation." In addition, the Fund claims that the Duhamels as
individuals took "functional[] control" of D&N's assets when they
sold the company's building to JED Realty and assigned the mortgage
on the property to themselves personally. Langone v. N&D Transp.
Co. ("Langone I"), No. 1:14-cv-11028-RWZ, Mem. Dec. at 2 (D. Mass.
Aug. 27, 2015). The Fund's first amended complaint includes two
3 Certain of these overlaps were alleged in the complaint,
while others were asserted in the Fund's Opposition to the Motions
to Dismiss. See Docket No. 52, Opposition to Motion, July 6, 2015,
at 10-11. When considering motions to dismiss for lack of subject-
matter jurisdiction pursuant to Federal Rule of Civil Procedure
12(b)(1), the court may consider materials outside the pleadings.
See González v. United States, 284 F.3d 281, 288 (1st Cir. 2002).
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counts stemming from this transaction, one alleging a fraudulent
transfer and the other seeking to reach and apply the funds owed
by JED Realty to the Duhamels.
The defendants moved to dismiss the amended complaint
pursuant to Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6).
Citing the Supreme Court's decision in Peacock, which we describe
below, defendants argued that suits premised on an alter ego theory
or based on piercing a corporate veil do not present a federal
question. They also invoked Futura Development of Puerto Rico,
Inc. v. Estado Libre Asociado De Puerto Rico, 144 F.3d 7 (1st Cir.
1998), in which this court rejected an alter ego claim as a basis
for ancillary federal jurisdiction. Defendants asserted that the
Fund's complaint does not specify any ERISA provision authorizing
the Fund to enforce the judgment rendered in the earlier action
against third parties. Hence, defendants contended, the complaint
should be dismissed for lack of federal subject matter jurisdiction
and because it failed to state a claim for which relief could be
granted. Defendants also challenged the fraudulent transfer claim
on multiple additional grounds, including that it was untimely.
B. The District Court's First Ruling
The district court initially granted the defendants'
motion to dismiss based on the factual inadequacy of the complaint.
Langone I, at 8-9. Although the court noted differences among the
circuits as to when federal subject matter jurisdiction exists for
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"a follow-on suit to collect an ERISA judgment from an alleged
alter ego of a judgment-debtor," id. at 7, the court sidestepped
that legal issue because it found the Fund's allegations
insufficient to support an inference that any defendant was D&N's
alter ego at the time D&N violated ERISA, id. at 8-9.4 The court
thus dismissed the alter ego counts (Counts I, II, and V) for
failure to state a claim, and it declined to exercise supplemental
jurisdiction over the state law fraudulent-transfer and reach-and-
apply claims (Counts III and IV).5
The Fund responded by filing a motion for relief from
judgment under Federal Rule of Civil Procedure 60(b)(6) or,
alternatively, to amend the judgment under Rule 59(e). The Fund
argued, inter alia, that the district court had misconstrued ERISA
case law and that, under the correct analysis, the Fund could
"easily remed[y]" its failure to allege the pertinent timing
through an amendment to its complaint. The court committed legal
error, according to the Fund, by holding that a valid ERISA claim
4
Among other points, the court noted that the complaint
"d[id] not allege that N&D had or breached any duties under an
ERISA plan, nor does it allege that N&D was a fiduciary of an ERISA
plan." Langone I, at 8.
5
The court also denied the Fund's motion to file a second
amended complaint to add defendants on the ground that it would be
futile "to assert the same legally flawed claims that are in the
current operative complaint against additional defendants."
Langone I, at 11.
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requires a showing that the defendants were plan fiduciaries. The
Fund also pointed to the court's incorrect statement that its first
amended complaint did not allege that N&D is an "employer" within
the meaning of ERISA. See 29 U.S.C. §§ 1002(5), 1301(b), 142(1),
152(2), (6), (7). The Fund did not object, however, to dismissal
of the alter ego claim against the Duhamels personally (Count II).6
C. The District Court's Second Ruling
The district court denied the Fund's post-judgment
motion, finding no basis for setting aside the judgment under Rule
60(b)7 or modifying the decision under Rule 59(e)8. Langone v. N&D
Transp. Co. ("Langone II"), No. 1:14-cv-11028-RWZ, Mem. Dec. at 7
(D. Mass. Nov. 18, 2015). With respect to the former, the court
refuted the Fund's assertion that the decision should be vacated
because the court had committed legal error in holding that ERISA
6 The Fund also reiterated its request to add defendants in a
second amended complaint that it said would include the missing
temporal allegation.
7Under Rule 60(b), "[t]he court may relieve a party . . . from
a final judgment, order, or proceeding" for various reasons,
including mistake, newly discovered evidence, fraud, or "any other
reason that justifies relief." Fed. R. Civ. P. 60(b), 60(b)(6).
Under the "catchall category," subdivision (b)(6), relief is
available "only in 'extraordinary circumstances.'" Buck v. Davis,
137 S. Ct. 759, 772 (2017) (quoting Gonzalez v. Crosby, 545 U.S.
524, 535 (2005)). The district court interpreted the Fund's
request as falling within the catchall provision.
8 Rule 59(e) simply states that "[a] motion to alter or amend
a judgment must be filed no later than 28 days after the entry of
the judgment."
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alter ego claims require an allegation of fiduciary status. To
the contrary, the court stated, it had merely identified fiduciary
status as one alternative prerequisite for an ERISA claim, along
with a breach of duty under an ERISA plan or alter ego status at
the time the primary actor violated ERISA. The court clarified
that it had dismissed the alter ego claims because the Fund had
not adequately alleged any of those grounds for ERISA liability.
Id. at 5. The court thus found no "extraordinary circumstances"
to justify vacating the prior judgment. Id.
The court also refused to alter its judgment so that the
Fund could file an amended complaint. Id. at 7. Relying on
Peacock and Futura Development, the court ruled that, even with
the proposed new timing allegation, the ERISA claims "would not
provide a basis for federal jurisdiction." Id. at 6-7.
On appeal, the Fund's primary argument is that the
district court erred as a matter of law in finding that its alter
ego claims (Counts I and V) would not fall within the federal
courts' subject-matter jurisdiction even if the complaint were
amended to allege that N&D was the alter ego of D&N at the time
the latter withdrew from the Fund and violated ERISA.9 The Fund
also argues that the district court should have granted its motion
9 Consistent with the position taken in its post-judgment
filings, the Fund does not challenge on appeal the dismissal of
its alter ego claim against the Duhamels personally (Count II).
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to amend the complaint to cure the temporal deficiency and
erroneously declined to exercise supplemental jurisdiction over
its state-law claims against the Duhamels and JED Realty (Counts
III and IV). The Fund thus asks this court to vacate the denial
of its motion for post-judgment relief.
II.
A. Standard of Review
As both parties observe, a district court's ruling on a
post-judgment motion under either Rule 59(e) or Rule 60(b)
ordinarily is reviewed for abuse of discretion. See Guadalupe-
Báez v. Pesquera, 819 F.3d 509, 518 & n.4 (1st Cir. 2016) (Rule
59(e)); Giroux v. Fed. Nat'l Mortg. Ass'n, 810 F.3d 103, 106 (1st
Cir. 2016) (Rule 60(b)). Here, however, the Fund asserts that we
should apply de novo review to the district court's denial of post-
judgment relief because that decision stemmed from the court's
misreading of ERISA law.
We agree that this appeal turns on a question of law --
whether the Fund's alter ego claims give rise to federal subject-
matter jurisdiction -- and that we do not defer to the district
court if we detect a legal error in its reasoning. See Guadalupe-
Báez, 819 F.3d at 518 (Rule 59(e)); Ungar v. Palestine Liberation
Org., 599 F.3d 79, 83 (1st Cir. 2010) (Rule 60(b)(6)); see also
Highmark Inc. v. Allcare Health Mgmt. Sys., Inc., 134 S. Ct. 1744,
1748 n.2 (2014) ("The abuse-of-discretion standard does not
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preclude an appellate court's correction of a district court's
legal or factual error: 'A district court would necessarily abuse
its discretion if it based its ruling on an erroneous view of the
law or on a clearly erroneous assessment of the evidence.'"
(quoting Cooter & Gell v. Hartmarx Corp., 496 U.S. 384, 405
(1990))).10
Accordingly, we turn to our review of the applicable
law. We briefly describe our general approach to the alter ego
doctrine in the ERISA context before considering the case law
discussing whether, and when, a federal action may be brought
against an asserted alter ego based on a previously entered
judgment against the signatory ERISA employer.
B. ERISA Alter Ego Status in the First Circuit
It is well established First Circuit law that the alter
ego doctrine applies to ERISA claims. See Massachusetts Carpenters
Cent. Collection Agency v. Belmont Concrete Corp. ("Belmont"), 139
F.3d 304, 308 (1st Cir. 1998) (noting that alter ego analysis was
"developed in the labor law context" and extended "to claims
involving employee benefit funds"). We have observed that reliance
on the alter ego doctrine in the ERISA context can prevent the
10
The Fund alternatively argues that our review is de novo
because the district court's post-judgment ruling was based on a
different rationale (failure to present a federal question) than
its original judgment dismissing the action for failing to state
a claim for relief. Regardless, the question before us is one of
law, which triggers plenary review.
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evasion of pension obligations, thereby protecting employee
benefits and denying employers "an unearned advantage in [their]
labor activities." Id. at 308 (quoting Chicago Dist. Council of
Carpenters Pension Fund v. P.M.Q.T., Inc., 169 F.R.D. 336, 342
(N.D. Ill. 1996)); see also id. ("[U]nderlying congressional
policy behind ERISA clearly favors the disregard of the corporate
entity in cases where employees are denied their pension benefits."
(quoting P.M.Q.T., Inc., 169 F.R.D. at 342)). Although the
doctrine is used primarily in circumstances "involving successor
companies, 'where the successor is merely a disguised continuance
of the old employer,' it also applies to situations where the
companies are parallel companies." Id. at 307 (quoting C.E.K.
Indus. Mech. Contractors, Inc. v. NLRB, 921 F.2d 350, 354 (1st
Cir. 1990)) (citations omitted); see also Union Builders, Inc. v.
NLRB, 68 F.3d 520, 524 (1st Cir. 1995).11
Among the relevant factors in determining whether a
second company is an alter ego of a signatory ERISA employer are
"continuity of ownership, similarity of the two companies in
relation to management, business purpose, operation, equipment,
11
The defendants do not contest the Fund's assertion that our
ERISA alter ego precedent is applicable to the non-payment of
withdrawal liability as well as to the obligation to contribute to
a pension fund. See 29 U.S.C. § 1451(b) (stating that, "[i]n any
action under this section to compel an employer to pay withdrawal
liability, any failure of the employer to make any withdrawal
liability payment within the time prescribed shall be treated in
the same manner as a delinquent contribution").
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customers, supervision, and anti-union animus -- i.e., 'whether
the alleged alter ego entity was created and maintained in order
to avoid labor obligations.'" Belmont, 139 F.3d at 308 (quoting
NLRB v. Hosp. San Rafael, Inc., 42 F.3d 45, 50 (1st Cir. 1994)).
"No single factor is controlling, and all need not be present to
support a finding of alter ego status." Id.
It is thus uncontroverted in our circuit that a plaintiff
may seek to impose ERISA liability on an alter ego of the employer
that formally bears the obligations imposed by the statute. The
dispute here concerns the Fund's attempt to do so in a new action
brought subsequent to a judgment against the signatory employer.
Such secondary litigation -- described by the district court as a
"follow-on suit" -- is the focus of the Supreme Court's decision
in Peacock and our analysis in Futura Development. We thus next
review that governing precedent.
C. "Follow-on" Jurisdiction: Peacock and Futura Development
In Peacock v. Thomas, plaintiff Thomas sued an officer
of his former employer in an attempt to collect a monetary judgment
obtained against the employer in an earlier ERISA action. 516
U.S. at 351-52. The defendant, Peacock, had been found not liable
in the original action, and the second suit was premised on
Peacock's allegedly improper disposal of the company's assets,
after the judgment, to prevent satisfaction of that judgment. Id.
at 352. In the original litigation, Thomas had sued for benefits
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due under the corporation's pension plan. Id. at 351. In the
second action, Thomas claimed that Peacock had participated in a
conspiracy to siphon assets from the company and fraudulently
transferred company assets in violation of state laws. Id.
The Supreme Court held that the federal courts lacked
subject matter jurisdiction over the second lawsuit. The Court
first rejected Thomas' reliance on ERISA as the source of federal
jurisdiction, observing that "[w]e are not aware of, and
[plaintiff] does not point to, any provision of ERISA that provides
for imposing liability for an extant ERISA judgment against a third
party." Id. at 353. Although Thomas suggested that his subsequent
suit arose under the ERISA provision authorizing civil actions for
"appropriate equitable relief," 29 U.S.C. § 1132(a)(3), the Court
pointed out that Thomas had "alleged no violation of ERISA or of
the plan." Id. The Court further held that Thomas' claim based
on piercing the corporate veil "does not state a cause of action
under ERISA and cannot independently support federal
jurisdiction." Id. at 353-54. Indeed, as the Court noted, the
challenged conduct in Peacock occurred years after the ERISA plan
was terminated and "did not occur with respect to the
administration or operation of the plan." Id. at 353 (quoting
Respondent's Br. at 11). Original jurisdiction based on the
federal statute was thus unavailable.
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The Court, however, did not entirely foreclose the
possibility of federal jurisdiction for a veil-piercing claim
brought in a lawsuit filed subsequent to an earlier ERISA judgment.
In dicta, the Court contemplated such a claim where the complaint
in the second litigation alleges an ERISA violation:
Even if ERISA permits a plaintiff to pierce
the corporate veil to reach a defendant not
otherwise subject to suit under ERISA, Thomas
could invoke the jurisdiction of the federal
courts only by independently alleging a
violation of an ERISA provision or term of the
plan. Piercing the corporate veil is not
itself an independent ERISA cause of action,
"but rather is a means of imposing liability
on an underlying cause of action."
516 U.S. at 354 (footnote omitted) (quoting 1 C. Keating & G.
O'Gradney, Fletcher Cyclopedia of Law of Private Corporations § 41,
at 603 (perm. ed. 1990)).
The Court in Peacock also considered, and rejected,
Thomas' contention that his suit fell within the federal courts'
ancillary jurisdiction. The Court explained that the federal
courts' power to dispose of supplemental claims that have "a
factual and logical dependence" on the "primary" federal claims
does not provide a basis for subject-matter jurisdiction when non-
federal claims are brought on their own in a separate proceeding.
See id. at 355 ("The court must have jurisdiction over a case or
controversy before it may assert jurisdiction over ancillary
claims."). Nor did Thomas' suit fit within the courts' limited
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ancillary enforcement jurisdiction, in which "a federal court's
inherent power to enforce its judgments" warrants action against
third parties to protect -- and collect -- a judgment already
imposed." Id. at 356. In such cases, the judgment creditor is
"not seek[ing] to impose liability for a money judgment on a person
not otherwise liable for the judgment," id. at 351, but is
attempting to secure the judgment debtor's funds via mechanisms
designed for that purpose, "including attachment, mandamus,
garnishment, and the prejudgment avoidance of fraudulent
conveyances," id. at 356.
In Futura Development, 144 F.3d at 8, a panel of this
court relied on Peacock, in a non-ERISA case, to conclude that the
district court lacked jurisdiction over a follow-on lawsuit
premised on an alter ego theory. The plaintiff company, Futura,
was seeking payment from the Commonwealth of Puerto Rico on a $12
million judgment previously issued against a public corporation,
the Cooperative Development Company ("CDC"), in an action
originally brought under federal diversity jurisdiction. See id.
at 10. Acknowledging that neither federal question nor diversity
jurisdiction applied to the claim against the Commonwealth, id.,
Futura argued that its new action was properly in federal court
under ancillary enforcement jurisdiction. It asserted that,
unlike the corporate officer sued in Peacock, the Commonwealth was
"not really a 'new' defendant" because it was the alter ego of the
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CDC, and it was thus liable for the primary judgment "from the
moment that the jury returned its verdict in the original
proceeding." Id. at 11. We rejected Futura's reasoning,
concluding that its second action was equivalent to the veil-
piercing claim in Peacock because it involved "an independent
theory of liability under equity, complete with new evidence."
Id. at 12. Under Peacock, such a new proceeding requires its own
basis for federal jurisdiction.12 Id. at 10-12.
III.
The question before us is whether the district court
properly concluded that it lacked subject-matter jurisdiction over
this action under the principles articulated in Peacock.
Initially, the court dismissed the Fund's complaint under Rule
12(b)(6) because it found the allegations insufficient to
establish the defendants' alter ego status. When the Fund sought
in its post-judgment motion to amend the complaint to specify that
12
Futura subsequently tried to bring its alter ego claim as
a supplementary proceeding in the original action. See U.S.I.
Props. Corp. v. M.D. Constr. Co., 230 F.3d 489, 492 (1st Cir.
2000). We again found no federal enforcement jurisdiction over
the claim. Id. at 492-93 (holding that federal enforcement
jurisdiction does not allow "proceedings to establish direct
liability against the Commonwealth on an alter ego theory
. . . where the limitations on diversity jurisdiction would have
prevented the Commonwealth from being named a defendant in the
action originally"). We declined to address the separate, "complex
question" of whether the case also could be dismissed based on the
Commonwealth's Eleventh Amendment immunity. See id. at 495.
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N&D was D&N's alter ego at the times pertinent to the disputed
withdrawal liability,13 the court concluded that the proposed
amendment would be futile. It reasoned that, even so revised, the
complaint would lack "allegations that the defendants exercised
control over D&N's business and/or played a part in D&N's ERISA
violation." Langone II, at 7 n.3. Absent such allegations, the
court stated,
[t]his matter is . . . not appreciably
different from a veil piercing situation such
as that analyzed in Peacock, 516 U.S. 349. It
is thus functionally an action against a third
party to collect on an existing judgment,
which is typically a matter for state courts.
See id. at 357.
Langone II, at 7 n.3. The court thus declined to vacate its prior
dismissal of the action because of "the subject matter jurisdiction
problem." Id. at 7.
The district court, however, misconstrued the Fund's
allegations concerning N&D's alter ego status with the proposed
new timing averment. By claiming that N&D was D&N's alter ego
when the withdrawal liability arose, and supporting that claim
13In referring to the alter ego concept with respect to N&D,
we use the term consistently with our prior usage in labor and
ERISA cases, i.e., to signify two employer entities that are
interchangeable based on the factors identified in Belmont and the
earlier cases on which it relied. See Belmont, 139 F.3d at 308-
09; Hosp. San Rafael, 42 F.3d at 50; C.E.K. Indus. Mech.
Contractors, 921 F.2d at 354. We address the alter ego claim
against JED Realty separately below.
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with factual allegations of substantial overlap in the companies'
operations, the Fund would be asserting that D&N and N&D were
interchangeable and that, accordingly, N&D necessarily "played a
part in D&N's ERISA violation." See supra note 13. The court's
fundamental error in evaluating the alter ego allegations
concerning N&D thus led it astray in assessing whether the Fund
had established federal subject-matter jurisdiction.
Properly viewed, this case is readily distinguishable
from Peacock and Futura Development. Under Peacock, a second
litigation seeking to collect on an earlier judgment must have its
own basis for federal subject-matter jurisdiction. Here, the Fund
maintains that N&D was -- at the pertinent times -- the same
company as D&N and, as such, bore the same obligation under ERISA
for the payment of that liability. As the district court
acknowledged, see Langone II, at 7 n.4, the Fund alleged that "N&D
Transportation is an 'employer' within the meaning of ERISA,"
Compl., Docket #31-1, ¶ 6 (citing 29 U.S.C. §§ 1002(5),
1301(b)(1)), and "an employer in an industry affecting commerce
within the meaning of ERISA," id. (citing 29 U.S.C. §§ 142(1),
152(2), (6)). In addition, as noted above, the complaint alleged
facts addressing the Belmont factors before asserting that N&D was
the alter ego of D&N and that, as D&N's alter ego, N&D was "liable
for the judgment issued against D&N" in the prior action. Id.
¶¶ 24-25.
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The Fund's claim against N&D was thus anchored in ERISA
and premised on N&D's de facto status as an ERISA employer, and
not -- as was the situation in Peacock -- on alleged wrongful
conduct outside the scope of the federal statute. Indeed, this
case presents the scenario the Supreme Court itself distinguished
from the circumstances presented in Peacock, i.e., one in which a
plaintiff "could invoke the jurisdiction of the federal courts
. . . by independently alleging a violation of an ERISA provision
or term of the plan." 516 U.S. at 354. Likewise, because ERISA
provides the jurisdictional hook, allowing the claim against N&D
to proceed is also consistent with Futura Development.14
The same cannot be said, however, for the alter ego claim
against JED Realty (Count V), which alleges that JED Realty is
responsible for the prior judgment as an alter ego of N&D -- but
14We further note that our conclusion on the alter ego claim
against N&D accords with both Court of Appeals decisions
highlighted by the district court. In Ellis v. All Steel
Construction, Inc., 389 F.3d 1031 (10th Cir. 2004), the Tenth
Circuit held that subject-matter jurisdiction under ERISA exists
for a follow-on suit only if the plaintiff asserts a direct ERISA
violation by the alter-ego defendant. Id. at 1035; see also id.
at 1034 (stating that "claims that posit an alter ego's direct
concurrent liability for an ERISA violation" "do[] not implicate
Peacock concerns"). The Seventh Circuit, meanwhile, has
distinguished between alter ego claims and the piercing-the-
corporate-veil theory at issue in Peacock, concluding that a
pension fund's cause of action against asserted alter egos
necessarily arises under federal law because "the same entity" is
being sued: "[W]hen the parent and subsidiary are just alter egos,
then everything depends on, and the claim arises under, federal
law." Board of Trs., Sheet Metal Workers' Nat'l Pension Fund v.
Elite Erectors, Inc., 212 F.3d 1031, 1038 (7th Cir. 2000).
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does not assert that JED Realty is directly liable as an ERISA
employer. See Compl., Docket #31-1, ¶¶ 72-73 (alleging that JED
Realty is an alter ego of N&D and, "[a]s an alter ego of N&D
Transportation, Defendant JED Realty is liable for any judgment
issued against N&D Transportation as the alter ego of D&N
Transportation"). Because this claim is based solely on the
relationship between N&D and JED Realty, it is akin to the veil-
piercing claim asserted in Peacock and the alter ego claim alleged
in Futura Development -- i.e., it involves a theory of liability
that does not present a federal question, involve diverse parties,
or fall within the federal courts' recognized ancillary
enforcement jurisdiction. Hence, considered on its own, there is
"no independent basis for [federal] jurisdiction" for the alter
ego claim against JED Realty. Peacock, 516 U.S. at 355.
Of course, if federal subject-matter jurisdiction exists
for the alter ego claim against N&D (Count I), the JED Realty alter
ego claim (Count V) -- as well as the state law fraudulent-transfer
and reach-and-apply claims (Counts III and IV) -- theoretically
could proceed pursuant to the court's supplemental jurisdiction.15
We offer no view on that path for the Fund's claims, as it is not
our role to consider in the first instance the factors informing
15 For the first time on appeal, the Fund asserts that the
district court had ancillary enforcement jurisdiction over the
fraudulent transfer claim. We decline to address that belated
contention here.
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the district court's discretionary judgment on whether to
entertain supplemental claims. See Ramos-Echevarría v. Pichis,
Inc., 659 F.3d 182, 191 (1st Cir. 2011) (noting court's
"considerable authority" to decide whether to exercise
supplemental jurisdiction based on factors that include "judicial
economy, convenience, fairness to litigants, and comity").
We therefore conclude that the district court erred in
refusing to vacate its dismissal of the Fund's alter ego claim
against N&D (Count I), and rejecting the proposed amended
complaint, on the ground that federal jurisdiction would be lacking
even if the complaint contained the temporal allegation concerning
N&D's alter ego status. Because the court's post-judgment rulings
on the other counts rest on this legal error, the court on remand
will need to reconsider its dismissal of those counts as well.
IV.
For the reasons detailed above, we vacate the district
court's denial of the Fund's Motion for Relief from Judgment and/or
Motion to Amend the Judgment and remand for further proceedings
consistent with this opinion.
So ordered. Costs to appellant.
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