Browning v. Tiger's Eye Benefits Consulting

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 06-1404
JEFFREY S. BROWNING, as Trustee of the Browning Equipment,
Inc. 401(k) Profit Sharing Plan,
Plaintiff - Appellant,
v.
TIGER’S EYE BENEFITS CONSULTING; THEODORE G. REEDER, III,
C.P.A.; DAVID M. DUKICH,
Defendants – Appellees,
and
POTOMAC ASSET MANAGEMENT GROUP, LLC,
Defendant.
--------------------
JOHN J. KORZEN,
Amicus Supporting Appellee David M. Dukich.
Appeal from the United States District Court for the Eastern
District of Virginia, at Alexandria. Claude M. Hilton, Senior
District Judge. (1:05-cv-303-CMH)
Argued: October 28, 2008 Decided: February 26, 2009
Before NIEMEYER and MICHAEL, Circuit Judges, and Richard D.
BENNETT, United States District Judge for the District of
Maryland, sitting by designation.
Affirmed by unpublished opinion. Judge Bennett wrote the
opinion, in which Judge Niemeyer and Judge Michael joined.
ARGUED: Richard Dennis Carter, Alexandria, Virginia, for
Appellant. Patrick John Kearney, SELZER, GURVITCH, RABIN &
OBENCY, CHTD., Bethesda, Maryland; Jenelle Neubecker, WAKE
FOREST UNIVERSITY, School of Law, Appellate Advocacy Clinic,
Winston-Salem, North Carolina, for Appellees. ON BRIEF: John J.
Korzen, Elizabeth H. Asplund, Amber Burleson, Lauren T.
Millovitsch, WAKE FOREST UNIVERSITY, School of Law, Appellate
Advocacy Clinic, Winston-Salem, North Carolina, Amicus Counsel
for Appellee David M. Dukich.
Unpublished opinions are not binding precedent in this circuit.
2
BENNETT, District Judge:
Appellant Jeffrey S. Browning, as Trustee of the Browning
Equipment, Inc. 401(k) Profit Sharing Plan, appeals the entry of
summary judgment by the district court in favor of the
Appellees, Tiger’s Eye Benefits Consulting, Theodore G. Reeder,
III, and David Dukich. The district court entered summary
judgment on alternative grounds: first, the district court found
as a matter of law that the Appellees were not fiduciaries under
section 409(a) of the Employee Retirement Income Security Act of
1974, 29 U.S.C. § 1132(a) (“ERISA”); and, second, the district
court found that the Appellees were entitled to summary judgment
because ERISA’s three-year statute of limitations had expired
before the suit was brought. Because we agree as to the latter
ground, the judgment below is affirmed.
I.
Browning Equipment, a small, family-owned tractor sales and
services company, maintains the Browning Equipment, Inc. 401(k)
Profit Sharing Plan (“the Plan”). At the time this suit
commenced, Appellant Jeffrey S. Browning (“Browning”) was a
Trustee of the Plan, as were Jean Copeland and Reyburn Browning,
Jeffrey Browning’s father. Under the Plan, the Trustees had
3
“the sole responsibility of the management of the assets held
under the Trust.” (J.A. 451.)
Theodore Reeder is a certified public accountant and the
sole shareholder of Tiger’s Eye Benefits Consulting, a business
that provided third-party consulting services to the Plan
beginning in 1994. Prior to 1994, the Plan had been a client to
Reeder’s former employer since 1984. The Plan engaged Tiger’s
Eye through annual letters which provided that “Tiger’s Eye
Benefits Consulting will be a third party plan administrative
consultant only, and will not act in the capacity of the Plan’s
‘ERISA Administrator.’” (J.A. 163-172.)
Between 1979 and 1999, most of the Plan’s assets were
invested in a fixed annuity insurance contract with Royal
Maccabees Life Insurance Company. Between 1997 and 1999, Reeder
began communicating with Reyburn Browning about reinvesting its
assets elsewhere. In April 1999, Reeder met with David Dukich,
a broker based in Frederick, Maryland who was selling
investments in U.S. Capital Funding, Inc. Dukich was promising
a return of 9.25% on a 180-day investment with U.S. Capital
Funding. Relying on the information given to him by Dukich,
Reeder recommended to Reyburn Browning in a letter dated April
20, 1999 that the Trustees invest $300,000 with U.S. Capital
Funding and $150,000 with John Hancock. Reeder told Reyburn
4
Browning that the U.S. Capital Funding investment was insured up
to $2,000,000 through CNA Insurance Companies.
Sometime between April 20 and April 26, 1999, Reeder
introduced Dukich to the Trustees. At the meeting, the Trustees
questioned Reeder and Dukich about the investment with U.S.
Capital Funding and received positive responses, including that
the investment was insured. On April 26, 1999, the Trustees
invested $555,000 with U.S. Capital Funding. In return, the
Plan received a promissory note bearing a 9.25% rate of return,
payable in 180 days from April 27, 1999. The note did not
contain an automatic reinvestment or renewal provision. Dukich
received a 9% commission, half of which was actually paid to
him. Reeder received a 1% commission from Dukich.
For the first few months, the Plan received information
about its investment directly from U.S. Capital Funding,
including monthly interest statements and a Form 1099. Jeffrey
Browning testified that, to his knowledge, none of the Trustees
ever expressly authorized the renewal of the U.S. Capital
Funding investment. Nonetheless, the Trustees did not receive
payment when the note became due in October 1999, and there is
no evidence suggesting that the Trustees inquired as to why
payment was not received. Also in October 1999, the Plan
stopped receiving monthly interest statements from U.S. Capital
5
Funding, and the record does not contain any evidence that the
Trustees acted to determine the reason that the statements
stopped arriving.
Dukich first learned that U.S. Capital Funding was not
paying funds to clients sometime in fall 2000. At that time,
Dukich was told that U.S. Capital Funding would not be paying
noteholders because of difficulty receiving funds from the
companies with which it was doing business. On February 20,
2001, Reeder informed the Trustees via letter that the assets
were temporarily unavailable and that litigation was currently
being pursued to “free up the monies.” (J.A. 348-49.) Reeder
also assured the Trustees that the “original investment is
guaranteed through [the CNA] insurance arrangement” and that
“interest earnings would be separately recoverable.” (Id.)
Then, on July 23, 2001, Reeder explained to the Trustees,
again by letter, that the 180-day investment was locked into
five-year notes. (J.A. 350.) He also explained “it was his
understanding” that U.S. Capital Funding initiated legal
proceedings in Florida in order to release invested funds.
(Id.) Consequently, Reeder advised the Trustees as follows:
“Although it is a difficult position to take, my suggestion
continues to be to wait on the legal actions pending . . . for
6
an ultimate resolution and release of monies invested through
the Browning Equipment Inc. Profit Sharing Plan.” (J.A. 351.)
Sometime in early November 2001, Browning had “the need to
find out what the story was on the insurance” because “the doubt
started to creep in our minds about the – you know, where the
funds were.” (J.A. 149.) On November 15, 2001, in response to
a request from Browning, Reeder sent a fax transmission to
Browning. Reeder acknowledged on the cover sheet that,
“although [Dukich] has made reference to me previously of an
insurance company ‘declaration page,’” Reeder had not yet
received the document. Thus, as Browning testified, Reeder’s
fax contained “nothing worthwhile” demonstrating that the U.S.
Capital Funding investment was insured. (J.A. 148.)
On February 19, 2002, the Trustees were explicitly informed
by Reeder that a court-appointed receiver was in place to
“coordinate the ongoing activity of U.S. Capital Funding, Inc.”
(J.A. 371-72.) By this time, the Plan had not received payment
on the U.S. Capital Funding note since March 22, 2000, when it
received its first and only payment in the amount of $25,317.12.
In a letter received by the Trustees on March 24, 2003, Reeder,
who is not an attorney, informed them that legal proceedings
were ongoing and that any legal action taken by the Trustees
themselves would not accelerate recovery. (J.A. 359.) He
7
added, however, that “I fully understand any actions that you
feel compelled to take in fulfilling your duties as . . .
Trustees.” (Id.)
Tragically, the problems associated with the Plan’s
investment in U.S. Capital Funding were dire. We have
previously noted that the U.S. Capital Funding was, “in reality,
a Ponzi scheme.” Smith v. Continental Ins., 118 Fed. Appx. 683,
683 (4th Cir. 2004). The Plan’s investment was all but lost.
Browning filed the underlying complaint on March 18, 2005,
asserting breach of fiduciary duty and prohibited transaction
claims under ERISA (Counts I and II), as well as a state law
tort claim (Count III). Without separately discussing the
individual claims asserted by Browning, the district court
granted summary judgment in Appellees’ favor on alternative
grounds: first, the district court concluded that Reeder and
Dukich were not fiduciaries of the Plan; and, second, the
district court concluded that the statute of limitations had
expired prior to Browning filing suit.
II.
The district court’s entry of summary judgment is reviewed
de novo, with the facts and the inferences from those facts
taken in a light most favorable to the nonmovant. See EEOC v.
8
Navy Fed. Credit Union, 424 F.3d 397, 405 (4th Cir. 2005).
Summary judgment is appropriate when "the pleadings,
depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no
genuine issue as to any material fact and that the moving party
is entitled to a judgment as a matter of law." Fed. R. Civ. P.
56(c); see Celotex Corp. v. Catrett, 477 U.S. 317, 322-23
(1986).
Although Browning appeals both grounds asserted by the
district court to grant summary judgment for Appellees, we
discuss only the latter ground because, assuming that Appellees
were fiduciaries to the Plan, Browning’s failure to timely file
suit under ERISA’s three-year statute of limitations necessarily
bars both ERISA claims. Additionally, although the district
court did not specifically discuss Browning’s state law claim,
the record is sufficiently developed for us to conclude that it
is barred by Virginia’s statute of limitations.
A.
Browning’s breach of fiduciary duty and prohibited
transaction claims are subject to the statute of limitations
framework provided in ERISA § 413, 29 U.S.C. § 1113. Section
413 provides that a claim for breach of fiduciary duty may not
commence after the earlier of:
9
(1) six years after (A) the date of the last action
which constituted a part of the breach or violation,
or (B) in the case of an omission, the latest date on
which the fiduciary could have cured the breach or
violation, or
(2) three years after the earliest date on which the
plaintiff had actual knowledge of the breach or
violation;
except that in the case of fraud or concealment, such
action may be commenced not later than six years after
the date of discovery of such breach or violation.
29 U.S.C. § 1113. Thus, section 413 “creates a general six year
statute of limitations, shortened to three years in cases where
the plaintiff has actual knowledge, and potentially extended to
six years from the date of discovery in cases involving fraud or
concealment.” Kurz v. Philadelphia Elec. Co., 96 F.3d 1544,
1551 (3d Cir. 1996).
Prior to 1987, section 413's three year statute of
limitations was triggered by either actual knowledge or
constructive knowledge. Congress amended the statute in 1987 to
require, at a minimum, “actual knowledge of the breach or
violation.” See Martin v. Consultants & Administrators, Inc.,
966 F.2d 1078, 1085 n.6 (7th Cir. 1992) (explaining that
“[b]efore it was amended in 1987, [29 U.S.C. § 1113] contained a
constructive knowledge provision, stating that the three-year
limitations period began when a plaintiff ‘could reasonably be
expected to have obtained knowledge’ from certain reports filed
10
with the Secretary of Labor” (citing removed statutory
language)). Since the 1987 amendment, the circuits that have
defined what constitutes actual knowledge have reached somewhat
divergent results.
The Third and Fifth Circuits’ narrow interpretation of
actual knowledge in section 413 “requires a showing that
plaintiffs actually knew not only of the events that occurred
which constitute the breach or violation but also that those
events supported a claim of breach of fiduciary duty or
violation under ERISA.” Int'l Union v. Murata Erie N. Am.,
Inc., 980 F.2d 889, 900 (3d Cir. 1992); see also Gluck v. Unisys
Corp., 960 F.2d 1168, 1177 (3d Cir. 1992); Maher v. Strachan
Shipping Co., 68 F.3d 951, 954 (5th Cir. 1995) (applying the
Third Circuit test). Other circuits, including the Sixth,
Seventh, Ninth, and Eleventh Circuits, require only that the
plaintiff have “knowledge of the facts or transaction that
constituted the alleged violation; it is not necessary that the
plaintiff also have actual knowledge that the facts establish a
cognizable legal claim under ERISA in order to trigger the
running of the statute.” Wright v. Heyne, 349 F.3d 321, 330
(6th Cir. 2003); see also Martin v. Consultants & Adm'rs, Inc.,
966 F.2d 1078, 1086 (7th Cir. 1992); Blanton v. Anzalone, 760
F.2d 989, 992 (9th Cir. 1985); Brock v. Nellis, 809 F.2d 753,
11
755 (11th Cir. 1987). The remaining circuits that have settled
on a definition fall somewhere between these two views. 1 See,
e.g., Caputo v. Pfizer, Inc., 267 F.3d 181, 193 (2d Cir. 2001)
(holding that a “plaintiff has ‘actual knowledge of the breach
or violation’ within the meaning of ERISA § 413(2), 29 U.S.C. §
1113(2), when he has knowledge of all material facts necessary
to understand that an ERISA fiduciary has breached his or her
duty or otherwise violated the Act”).
Although this Court has not had occasion to precisely
define “actual knowledge of the breach or violation” under
section 413(2), 2 we need not settle on a hard and fast definition
1
Ironically enough, there appears to be some disagreement
as to whether there is even a circuit split on the definition of
actual knowledge. The Sixth Circuit specifically explained that
“courts are divided on the issue of what constitutes ‘actual
knowledge’ under § 1113(2).” Wright 349 F.3d at 328. In Edes
v. Verizon Commc’ns, Inc., 417 F.3d 133 (1st Cir. 2005),
however, the First Circuit refused to acknowledge that there was
a circuit split, instead finding that the respective positions
of the circuits are “more nuanced” and the differences
“exaggerated.” Id. at 141.
2
We have previously stated that the three-year limitations
period “begins to run when a plaintiff has knowledge of the
alleged breach of a responsibility, duty, or obligation by a
fiduciary.” Shofer v. Hack Co., 970 F.2d 1316, 1318 (4th Cir.
1992). In Shofer, however, there was no dispute between the
parties that the three-year limitations applied and had expired
when suit was filed. The issue in Shofer was whether filing an
earlier suit in Maryland state court based on the same facts
equitably tolled the running of the three-year statute of
limitations under federal tolling principles. Thus, Shofer did
(Continued)
12
in the instant case. Based on the statutory amendment in 1987,
it is plainly apparent that “actual knowledge must be
distinguished from constructive knowledge.” Martin, 966 F.2d at
1086. The point in which one has “actual knowledge of the
breach or violation,” as opposed to constructive knowledge, in
turn depends largely on the “complexity of the underlying
factual transaction, the complexity of the legal claim[,] and
the egregiousness of the alleged violation.” Id. We also agree
with the First Circuit that “[t]he amendment to ERISA § 413
means that knowledge of facts cannot be attributed to plaintiffs
who have no actual knowledge of them,” and that “there cannot be
actual knowledge of a violation for purposes of the limitation
period unless a plaintiff knows ‘the essential facts of the
transaction or conduct constituting the violation.’” Edes, 417
F.3d at 142 (emphasis in original) (citing Martin, 966 F.2d at
1086). Thus, the appropriate inquiry is fact-intensive and, on
the facts before us, we have little difficulty finding that the
Trustees had the requisite factual knowledge to trigger the
three-year statute of limitations under section 413(2).
not examine the meaning of “actual knowledge of the breach or
violation.”
13
Browning’s ERISA claims are based on allegations that
Appellees failed to render advice in the best interest of the
plan, failed to diversify funds, failed to adequately
investigate the U.S. Capital Funding investment, and invested
the Plan’s assets for their own benefit. The district court
determined that the Trustees “knew or should have known of the
problems with the Note in February 2002 because Reeder wrote to
inform them that a receiver had been appointed for U.S. Capital
Funding.” (J.A. 538.) Although it is not clear whether the
district court applied an actual or constructive notice
requirement, 3 we conclude that, by February 19, 2002, the
Trustees had actual knowledge of enough sufficient facts relied
upon in their legal claims to trigger the three-year limitations
period. On February 19, 2002, the Trustees were unambiguously
informed that the Plan’s $555,000 investment was placed in
court-appointed receivership. On that date, the Trustees
undoubtedly had “knowledge of [the] transaction’s harmful
consequences,” as well as notice of “actual harm.” Gluck, 960
F.2d at 1177.
3
Because of the amendment to 29 U.S.C. § 1113, the three-
year statute of limitations did not begin to run on the date
that the Trustees should have known about facts establishing a
breach or violation. It began to run only when they had actual
knowledge of the facts.
14
Although this fact alone convinces us that the Trustees had
actual knowledge of the breach or violation, the record reveals
that the Trustees also had direct, first-hand knowledge of other
facts by February 19, 2002, making their ERISA claim patently
clear by then. For example, the Trustees were fully aware that
their investment was not diversified on April 26, 1999, the date
they first purchased the promissory note. By investing the
entire liquid portion of the Plan’s funds with U.S. Capital
Funding, the Trustees did not accept Reeder’s advice to invest a
lesser amount with U.S. Capital Funding with the balance
invested elsewhere.
Moreover, the Trustees had actual knowledge of facts
demonstrating that the Plan’s money was not invested in an
insured, 180-day promissory note, as they originally believed to
be the case. Although the Trustees knew that the note was
payable in 180 days and did not contain an automatic
reinvestment or renewal provision, the Plan was not paid after
180 days and the Trustees did not receive a single monthly
interest statements from U.S. Capital Funding after October
1999. By late 2000, the Trustees were informed that U.S.
Capital Funding was not paying noteholders upon maturity of the
note, and the Trustees were further informed in February 2001
that litigation involving U.S. Capital Funding had already
15
ensued. On July 23, 2001, the Trustees were told that their
initial 180-day investment was apparently “locked into five-year
notes.” Finally, in November 2001, Browning, concerned about
the lack of insurance of the Plan’s investment, requested
documents from Reeder but received nothing in return to assuage
his concerns. By that point, the Trustees had not received a
single document indicating that the Plan’s investment was in
fact insured.
Because we do not believe that the nature of the
transaction was overly factually complex (it involved the
purchase of only a single promissory note), and because the
alleged breach by the Appellees is quite egregious (the entire
purchase price of $555,000 was unrecoverable), see Martin, 966
F.2d at 1086, we conclude that the aforementioned facts taken
together more than establish that the Trustees had actual
knowledge under 29 U.S.C. § 1113 no later than February 19,
2002. Thus, assuming that the Appellees were in fact
fiduciaries (an issue we need not reach), the three-year statute
of limitations ran on February 19, 2005. Consequently,
Browning’s lawsuit, filed on March 18, 2005, was time barred.
16
B.
Browning’s fallback position is that the six-year “fraud or
concealment” period applies to his ERISA claims, rather than the
three-year “actual knowledge of the breach or violation” period.
The district court did not address this argument in its
memorandum opinion, but implicitly rejected it by granting
Appellees’ motion for summary judgment.
If applicable, the “fraud or concealment” provision extends
the statute of limitations period to six years beginning on the
date of discovery. As relevant here, the six-year “fraud or
concealment” provision also encompasses at a minimum the
“fraudulent concealment doctrine,” which applies when the
defendant acts to prevent or delay the plaintiff’s discovery of
the breach. 4 See, e.g., Caputo, 267 F.3d at 188. Rooted in
federal common law, the fraudulent concealment doctrine tolls
the statute of limitations “until the plaintiff in the exercise
4
The Second Circuit in Caputo interpreted the “fraud or
concealment” provision in 29 U.S.C. § 1113 as independently
including both fraud and fraudulent concealment claims. See
Caputo, 267 F.3d at 190 (interpreting “fraud or concealment” as
“fraud or [fraudulent] concealment”). This appears to be the
minority view. Id. at 188-89 (citing six Unites States Courts
of Appeal—i.e. the First, Third, Seventh, Eighth, Ninth, and
D.C. Circuits—that have interpreted “fraud or concealment” as
synonymous with “fraudulent concealment”). We have not been
asked to address this issue, however, as Browning “do[es] not
claim that [Reeder and Dukich] committed fraud by false
representations or omissions.” (App. Reply 10.)
17
of reasonable diligence discovered or should have discovered the
alleged fraud or concealment.” J. Geils Band Employee Benefit
Plan v. Smith Barney Shearson, Inc., 76 F.3d 1245, 1255 (1st Cir.
1996) (citing Larson v. Northrop Corp., 21 F.3d 1164, 1172-74
(D.C. Cir. 1994)). We conclude that the fraudulent concealment
doctrine is inapplicable in this case.
The fraudulent concealment doctrine does not apply here for
the simple reason that we find nothing in the record
demonstrating that the Trustees were prevented from discovering
the breach or violation as a result of concealment by Appellees.
The fraudulent concealment doctrine “requires the plaintiffs
show (1) that defendants engaged in a course of conduct designed
to conceal evidence of their alleged wrongdoing and that (2)
[the plaintiffs] were not on actual or constructive notice of
that evidence, despite (3) their exercise of diligence.”
Larson, 21 F.3d at 1172. Thus, the fraudulent concealment
doctrine does not trigger the six-year limitations period under
29 U.S.C. § 1113 if the concealing act does not delay actual or
constructive notice of the fiduciary’s wrongdoing.
In this case, Browning contends that Reeder and Dukich
fraudulently concealed their breach of fiduciary duty “by
assuring the Plan that [Dukich] was protecting their legal
rights and by discouraging them from otherwise seeking
18
independent legal advice.” (App. Reply 10.) Thus, Browning’s
argument is tied to the fact that the Trustees were advised by
letter in July 2001 and again in March 2003 that they should
withhold legal action.
However, notwithstanding the July 2001 letter’s advice
regarding counsel, the Trustees had already accumulated
significant indicia of a viable claim against Appellees. In
fact, the July 2001 letter explained a component of the alleged
breach, as it stated that the 180-day investment was locked into
five-year notes. Thus, the July 2001 letter itself did not
prevent or delay the plaintiff’s discovery of the breach. And
on February 19, 2002, well before the March 2003 letter was
sent, the Trustees were unambiguously informed that the Plan’s
$555,000 investment was placed in court-appointed receivership.
At that time, the Trustees not only had “actual knowledge of a
breach or violation” under section 413(2), but, by necessary
implication, they also had clearly discovered the breach or
violation that formed the basis of their suit. Thus, “[t]he
claim, such as it was, lay bare for the world to see.” Kurz, 96
F.3d at 1552.
In sum, the July 2001 letter therefore did not delay
discovery of the “breach or violation” because, regardless of
the letter, the Trustees were well aware of Appellees’
19
wrongdoing by February 19, 2002. Further, because the three-
year limitations period was triggered at that time, the March
2003 letter certainly had no effect on the Trustees’ discovery
of the breach or violation.
C.
Lastly, we turn to Browning’s state law professional
malpractice claim, which alleges that Appellees negligently
provided investment advice to the Trustees. The record in this
case amply supports the district court’s dismissal of the claim.
Under Virginia law, a claim for professional negligence,
although sounding in tort, is considered an action for breach of
contract for purposes of the statute of limitations because the
legal claim is grounded in contract law. See Virginia Military
Institute v. King, 232 S.E.2d 895, 899-900 (Va. 1977). Under
Virginia law, the statute of limitations for contract claims is
five years for contracts in writing, and three years for oral
contracts. Va. Code Ann. § 8.01-46. The statute of limitations
accrues on the date of breach, not the date of the resulting
damage is discovered. Id. § 8.01-230.
Here, Browning’s malpractice claim is based entirely on the
Appellees’ recommendation to purchase the U.S. Capital Funding
investment. Browning’s argument is that the Appellees
“recommended that the Trustees invest ‘a larger portion’ of the
20
Plan’s assets” with U.S. Capital Funding. (App. Brief 38.)
Even assuming that the professional relationship between the
parties was based in contract (which appears to be the case),
the lengthier five-year limitations period provided under
Virginia law still bars this claim. Based on Appellees’
recommendations, the Trustees purchased the U.S. Capital Funding
note on April 26, 1999, more than five years and eleven months
before this action was filed on March 18, 2005. 5 Therefore, the
state law professional malpractice claim is also barred by the
statute of limitations.
III.
The district court did not err in granting summary judgment
to Appellees on the grounds that Browning’s action was barred by
5
Equitable estoppel principles do not save Browning in this
case. Based on Virginia statutory and case law, we have held
that the “statute of limitations is tolled until a person
intentionally misled by a putative defendant could reasonably
discover the wrongdoing and bring action to redress it.” FDIC
v. Cocke, 7 F.3d 396, 402 (4th Cir. 1993). As discussed at
length earlier, we find that the Trustees discovered the
wrongdoing on February 19, 2002, when they learned that the
Plan’s $555,000 investment was placed in court-appointed
receivership. The July 2001 letter advising the Trustees to
forgo legal action was sent seven months before they had actual
knowledge. Thus, even if equitable estoppel principles tolled
the running of the statute of limitations for this seven-month
period, Browning’s action was still filed four months late.
21
the statute of limitations. Consequently, the judgment of the
district court is
AFFIRMED.
22