Local 6-0682 International Union of Paper v. National Industrial Group Pension Plan , 342 F.3d 606 ( 2003 )

RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206 2 Local 6-0682 Int’l Union of Paper v. Nat’l No. 01-2680
ELECTRONIC CITATION: 2003 FED App. 0326P (6th Cir.) Industrial Group Pension Plan, et al.
File Name: 03a0326p.06
Appeal from the United States District Court
for the Western District of Michigan at Grand Rapids.
UNITED STATES COURT OF APPEALS No. 00-00419—Robert Holmes Bell, Chief District Judge.
FOR THE SIXTH CIRCUIT
_________________ Argued: April 30, 2003
Decided and Filed: September 11, 2003
LOCAL 6-0682 X
INTERNATIONAL UNION OF - Before: MOORE and ROGERS, Circuit Judges; KATZ,
PAPER, ALLIED -INDUSTRIAL, - District Judge.*
- No. 01-2680
CHEMICAL & ENERGY - _________________
WORKERS , AFL-CIO, CLC, >
,
ex rel National Industrial - COUNSEL
Group Pension Plan, f/k/a - ARGUED: Jeffrey A. Heldt, KORNEY & HELDT,
Local 7682, United - Bingham Farms, Michigan, for Appellant. Patrick F. Hickey,
Paperworkers International - DYKEMA GOSSETT, Detroit, Michigan, for Appellees.
Union, - ON BRIEF: Jeffrey A. Heldt, KORNEY & HELDT,
-
Plaintiff-Appellant, Bingham Farms, Michigan, for Appellant. Patrick F. Hickey,
- DYKEMA GOSSETT, Detroit, Michigan, for Appellees.
-
v. - _________________
-
NATIONAL INDUSTRIAL - OPINION
GROUP PENSION PLAN, an - _________________
-
ERISA pension plan; - ROGERS, Circuit Judge. Plaintiff Local 6-0682 (“Union”)
NATIONAL INDUSTRIAL - appeals the district court’s grant of summary judgment to the
GROUP PENSION PLAN - defendants National Industrial Group Pension Plan
ADMINISTRATIVE AGENCY , - (“NIGPP”) and the National Industrial Group Pension Plan
and its administrator, a - Administrative Agency (“Agency”). The Union seeks to
foreign corporation, - recover benefits under the Employee Retirement Income
- Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001–1461,
Defendants-Appellees. -
N
*
The Honorable David A. Katz, United States District Judge for the
Northern District of Ohio, sitting by designation.
1
No. 01-2680 Local 6-0682 Int’l Union of Paper v. Nat’l 3 4 Local 6-0682 Int’l Union of Paper v. Nat’l No. 01-2680
Industrial Group Pension Plan, et al. Industrial Group Pension Plan, et al.
for the Agency’s negligence in providing, as a courtesy, a benefit would apply to “future service only.” Consequently,
benefits-amount quotation that turned out to be erroneous. the Supplement Quotation’s prediction of “a $3.55 increase in
Because we decline to infer a federal common law cause of Benefit Level” overstated the return the Union members
action for negligence in giving advice to the Union regarding would receive in exchange for Checker’s $.10 increase in the
ERISA plan benefits, we affirm. rate of contribution.
The Union is the exclusive bargaining agent for its The parties became aware of the error only after the Union
approximately 350 members, all of whom are employed by had negotiated a $.10 per hour increase in the contribution
the Kalamazoo facility of Checker Motor Corp. (“Checker”). rate with Checker, at which time it was essentially too late to
Pursuant to an agreement between the Union and Checker, all change anything. At that point the Agency sent the Union a
members participate in the NIGPP, a multi-employer pension letter explaining its error; it apologized, but it did not adjust
plan that is an “employee pension benefit plan” within the the Union members’ benefits to the Supplement Quotation’s
meaning of ERISA, 29 U.S.C. § 1002(2)(A), and $3.55 level. Later, however, the Agency retroactively
consequently is governed by and subject to ERISA. The increased the Union members’ benefits three
NIGPP, in turn, is administered by the Agency. The Agency times—apparently due to the NIGPP’s favorable economic
itself is a “third-party administrator” in ERISA parlance. See performance—to a total benefit level that exceeded even the
Freimark & Thurston Agency, Inc. v. Nat’l City Bank of inflated level provided in the Supplement Quotation.
Dayton, 231 F. Supp. 2d 713, 720 n.8 (S.D. Ohio 2002).
The Union filed a negligence suit against the Agency and
In March of 1999 the Union and Checker were re- NIGPP in district court, seeking to recover on behalf of its
negotiating their collective bargaining agreement. On members the difference between the benefits predicted in the
March 15, before the parties had begun negotiating pension Supplement Quotation and the benefits actually received
benefits, the Agency sent the Union a Supplement Quotation (without regard to the later increases). The district court
letter to aid the Union in its pension negotiations. The letter dismissed the case, finding that the Union lacked statutory
explained that “[t]his quotation . . . is consistent with the standing to bring an ERISA claim, and that its negligence
applicability of your last certified increase” and stated that claim was preempted by ERISA. On appeal the Union bases
“[a] $.10 increase in the rate of contribution will provide a jurisdiction for its suit solely on ERISA, because the NIGPP
$3.55 increase in Benefit Level.” The Agency routinely sends plan that the Agency administers is an ERISA plan and
such Supplement Quotations to its participant groups on the because the Union characterizes the suit as one “by and on
eve of collective bargaining—a service it provides as a behalf of participants to enforce rights and obtain relief under
courtesy and not as a matter of statutory or contractual ERISA.”
obligation.
We review de novo the district court’s order granting
The Agency in the past had calculated the Union’s benefits summary judgment. Bush v. Dictaphone Corp., 161 F.3d
increases with the understanding that the increases would 363, 367 (6th Cir. 1999). Viewing all of the evidence in the
apply to “all service,” which includes a participant’s past light most favorable to the Union as the non-moving party,
service years. The Supplement Quotation, however, we may affirm only if there is no genuine issue of material
incorrectly assumed, without stating, that the increased
No. 01-2680 Local 6-0682 Int’l Union of Paper v. Nat’l 5 6 Local 6-0682 Int’l Union of Paper v. Nat’l No. 01-2680
Industrial Group Pension Plan, et al. Industrial Group Pension Plan, et al.
fact and the Agency is entitled to judgment as a matter of law. disclosures.3 Further, in light of the facts of this case it is
Id. at 368. evident that the Union would have this cause of action extend
to negligence in disclosures that are offered gratuitously, out
The Union does not argue that it has statutory standing of no obligation either under contract or under ERISA.
under ERISA.1 Even where parties that have statutory
standing are concerned, ERISA itself provides no cause of Federal courts do have a certain latitude to create federal
action to recover money damages for a third-party common law under ERISA. See Firestone Tire & Rubber Co.
administrator’s negligence.2 The Union proposes that we v. Bruch, 489 U.S. 101, 110 (1989) (noting that “we have held
overcome both difficulties by creating a federal common law that courts are to develop a ‘federal common law of rights and
cause of action for negligence under ERISA, a cause of action obligations under ERISA-regulated plans’”) (quoting Pilot
that would allow a party to recover money damages from a Life Ins. Co. v. Dedeaux, 481 U.S. 41, 56 (1987)). This
third-party administrator for injuries proximately caused by authority, however, is limited to instances in which ERISA is
the administrator’s negligence in making ERISA-plan-related “silent or ambiguous,” Muse v. IBM, 103 F.3d 490, 495 (6th
Cir. 1996), where there is an “awkward gap in the statutory
scheme,” Tassinare v. Am. Nat’l Ins. Co., 32 F.3d 220, 225
(6th Cir. 1994), or where it may “be said that federal common
law is essential to the promotion of fundamental ERISA
policies.” Id.1
The statute’s standing provision, § 502, lists four categories of
“[p]ersons empowered to bring a civil action”—namely, participants,
The present case is not such an instance. First, the problem
beneficiaries, plan fiduciaries, and the S ecretary of Lab or— and this list is not that ERISA is silent on the issue of misleading or
is exclusive. 29 U.S.C. § 1 132 (a); Whitworth Bros. Storage Co. v. Cen t. inaccurate disclosures; rather, it allows recovery for such
States, Southeast & Southwest Areas Pension Fund, 794 F.2d 221, 228 disclosures under some circumstances, but not under those
(6th Cir. 1986) (holding that the court had no jurisdiction under § 502 to presented here. See, e.g., Drennan v. Gen. Motors Corp., 977
consider the ERISA claim of an employer—a p arty not listed in
§ 502 — because “C ongress intend ed to limit the pa rties who could
F.2d 246, 251 (6th Cir. 1992) (“Misleading communications
maintain actions pursuan t to section 502,” and “section 502 is an to plan participants ‘regarding plan administration (for
exclusive grant of jurisdiction”). Unions are not included in the § 502 list, example, eligibility under a plan, the extent of benefits under
and though a union might qualify as a “fiduciary” under § 502(a)(3), 29 a plan) will support a claim for a breach of fiduciary duty.’”)
U.S.C. § 113 2(a)(3), see Forys v. United Food & Commercial Worker’s (quoting Berlin v. Mich. Bell Tel. Co., 858 F.2d 1154, 1163
Int’l Union, 829 F.2d 603 (7th Cir. 1987 ), the Union m akes no effort to
show how it fits this catego ry. See also New Jersey State AFL-CIO v.
(6th Cir. 1988)); Krohn v. Huron Mem. Hosp., 173 F.3d 542,
New Jersey, 747 F.2d 891, 893 (3d Cir. 19 84) (“It is clear fro m the statute 547 (6th Cir. 1999) (“[A] fiduciary breaches its duties by
that labo r unions are neither participants nor beneficiaries”).
2 3
Though, as is mentioned below, ER ISA does allow participants and Though the parties discuss preemption, strictly speaking preemption
beneficiaries to seek equitable relief for certain disclosures, see generally is not an issue here because the Union brings its negligence action under
ERISA § 502(a)(3), 29 U.S.C. § 1132(a)(3), it does not allow money E RIS A— which provides no suc h cause of action— and not und er state
damages in such cases. See M ertens v. He witt Assocs., 508 U.S. 248, 255 law. Hence the question is not whether E RISA preempts wha t would
(1993) (holding that compensatory damages are legal damages, and otherwise be a valid state law cause of action, but whether the Union has
consequently are not available under § 50 2(a)(3)). a cause of action under federal law.
No. 01-2680 Local 6-0682 Int’l Union of Paper v. Nat’l 7
Industrial Group Pension Plan, et al.
materially misleading plan participants, regardless of whether
the fiduciary’s statements or omissions were made
negligently or intentionally.”). Second, though ERISA’s
failure to provide a remedy for the Union might conceivably
be described as a “gap in the statutory scheme,” the Union has
given us no reason to believe that the gap is “awkward,” or
that creation of the Union’s proposed cause of action is
“essential to the promotion of fundamental ERISA policies.”
Tassinare, 32 F.3d at 225.
Consequently, we find the Union’s claims without merit,
and we AFFIRM the judgment of the district court.