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724 F.2d 747
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421 F.3d 96
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ACAN
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Santiago Amaro v. The Continental Can Company
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CUDAHY, Circuit Judge. For plaintiffs Alexina Nechis and Doris Mady, members of health insurance plans offered by Oxford Health Plans, Inc., their assorted aches became a legal pain in the neck when their claims for chiropractor coverage were denied. Both Nechis and Mady had selected plans that covered chiropractic treatment from providers outside plan networks and both were treated by out-of-network chiropractors in late 2002. In December of 2002, Oxford had retained Triad Healthcare, Inc. to review its chiropractor claims and presumably to reduce its expenses. After receiving notice that most or all of their chiropractor claims had been denied, the plaintiffs sued Oxford and Triad on behalf of themselves and other similarly situated members, alleging multiple violations of the Employee Retirement Income Security Act (ERISA), including breach of their fiduciary duty and of their disclosure obligations, as well as failure to provide benefits as described in plan documents. The district court dismissed the plaintiffs’ claims pursuant to Fed.R.Civ.P. 12(b)(6), finding that Nechis had failed to exhaust administrative remedies and that Mady’s claims failed on their merits. The plaintiffs appeal, and we affirm. I. Oxford Health Plans, Inc. underwrites, administers and operates employee welfare plans. As part of its product line, it offers HMO, PPO and PSO plans, each of which includes coverage for chiropractic care that is “medically necessary.” Oxford defines “medically necessary” services as those services “required to identify or treat your illness or injury” which its medical director determines to be “1) Consistent with symptoms or diagnosis and treatment of your condition; 2) Appropriate with regard to standards of good medical practice; 3) Not solely for your convenience or that of any provider; and 4) The most appropriate supply or level of service which can safely be provided.” In December of 2002, Oxford retained Triad Healthcare, Inc. to review its claims for chiropractic service. In the spring of 2003, Oxford distributed to its members a brochure titled “Healthy Mind, Healthy Body,” informing subscribers that their in-network chiropractors would now be required to submit treatment plans for prior approval by Triad before chiropractic services would be covered, but that submission by out-of-network chiropractors for pre-approval was optional. The brochure also stated that post-service determinations would include a review of clinical notes, patient records and like documentation. As required by ERISA, Oxford has an appeals process for adverse benefit determinations, consisting of three steps. Members must first file a grievance by telephone or mail; Oxford is supposed to acknowledge receipt of each such grievance within 15 days and to issue a determination within 30 days after receiving the information pertinent to the grievance. Members who wish to dispute the outcome of their grievance determination can re-file the grievance with Oxford’s Grievance Re*99view Board and thereafter may institute a final appeal of a denied grievance to its Board of Directors’ Committee. Both Alexina Neehis and Doris Mady had been members of Oxford health plans. Neehis received coverage through her union benefits package that entitled her to unlimited in-network chiropractic coverage, including 15 visits to out-of-network chiropractors based on a showing of medical necessity. Mady was a member of Oxford’s Freedom Plan, and her premiums were paid by her employer from approximately April of 1997 until March of 2002, when her job was eliminated through downsizing. After losing her job, Mady elected to continue her coverage through COBRA until April 30, 2003.1 Switching to COBRA coverage did not alter the terms or conditions of her plan, which entitled her to unlimited in-network chiropractic care and coverage for a maximum of $500 per year for out-of-network care. Both plaintiffs submitted out-of-network chiropractic care claims after Triad began reviewing claims; Neehis had been treated in January 2003 and Mady had been treated in November 2002 by providers whom they had seen previously without insurance coverage difficulties. After receiving notice that their benefit claims for out-of-network services had been denied, both Neehis and Mady assert that they attempted to contact Oxford and/or Triad but were unable to do so. Neehis alleges that both she and her chiropractor tried to contact Oxford and Triad for months via telephone, fax and mail but received no satisfactory response. Mady states that she attempted to resolve her denied claims through Oxford’s administrative channels by writing letters and placing phone calls appealing the denial of coverage. She was actually notified that her files were being turned over for review and that her grievance had been submitted to the appeals division for first-level review. However, she received no word about the status of her appeal after waiting 60 days. On September 22, 2003, the plaintiffs brought this action against Oxford and Triad on behalf of themselves and other similarly situated plan participants. The plaintiffs first alleged that Oxford breached its ERISA disclosure obligations by failing to inform participants within 60 days of instigating its practice of making chiropractic coverage decisions based on undisclosed cost-based criteria rather than medical necessity and by not informing participants that Triad received financial incentives to deny chiropractic claims and to limit coverage. Further, the plaintiffs alleged that Oxford delayed payment of covered claims to earn additional interest on premiums. The plaintiffs also contended that Oxford failed to provide benefits due under health insurance plans governed by ERISA and that this failure resulted in unjust enrichment for Oxford. Finally, the plaintiffs asserted that both Oxford and Triad had breached their fiduciary duties under ERISA. Both plaintiffs also stated that they had exhausted all administrative remedies. On January 16, 2004, Oxford moved to dismiss the plaintiffs’ claims under Fed. R.Civ.P. 12(b)(6), and Triad moved to dismiss them for lack of subject matter jurisdiction under Rule 12(b)(1) (and alternatively under 12(b)(6)). On August 4, 2004, the district court granted the defendants’ motions and dismissed the plaintiffs’ claims under Rule 12(b)(6), finding that *100Nechis had failed to exhaust administrative remedies and that Mady’s claims failed on their merits, in particular because legal restitution was not one of the “equitable remedies” available under § 502(a)(3) of ERISA and that no additional disclosure obligations could be imposed on the defendants. On appeal, the plaintiffs assert that they did seek appropriate equitable forms of relief available under § 502(a)(3), that Oxford is liable for disclosure violations, that Nechis exhausted her administrative remedies and that the district court abused its discretion by not granting leave to re-plead. II. We have jurisdiction over this appeal under 28 U.S.C. § 1291. We review de novo the dismissal of this case under Fed. R.Civ.P. 12(b)(6). Freedom Holdings, Inc. v. Spitzer, 357 F.3d 205, 216 (2d Cir.2004). Dismissal of a complaint under Fed. R.Civ.P. 12(b)(6) for failure to state a claim upon which relief can be granted is appropriate when “it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.” Harris v. City of New York, 186 F.3d 243, 250 (2d Cir.1999) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). The appropriate inquiry is not whether a plaintiff is likely to prevail, but whether he is entitled to offer evidence to support his claims. See Chance v. Armstrong, 143 F.3d 698, 701 (2d Cir.1998). At this stage, we assume that all well-pleaded factual allegations are true and draw all reasonable inferences in the plaintiffs favor. See E.E.O.C. v. Staten Island Sav. Bank, 207 F.3d 144, 148 (2d Cir.2000). In addition, we limit our consideration to facts stated in the complaint or documents attached to the complaint as exhibits or incorporated by reference. See Newman & Schwartz v. Asplundh Tree Expert Co., 102 F.3d 660, 662 (2d Cir.1996). A. Standing to Sue Under § 502(a)(3) of ERISA In granting the defendants’ motions to dismiss under Fed.R.Civ.P. 12(b)(6), the district court held that Nechis had failed to exhaust administrative remedies under Kennedy v. Empire Blue Cross & Blue Shield, 989 F.2d 588 (2d Cir.1993), and so addressed only Mady’s claims on the merits. We find, however, that considerations of standing prove fatal to Mady’s allegations since she is not a plan “participant” under § 502(a)(3). As is discussed below, we are dubious that Nechis’s claims may be dismissed for failure to exhaust administrative remedies and hence address them on the merits. Oxford argues that, since Mady was not a member of its Freedom Plan at the time her complaint was filed, she could not benefit from injunctive relief and thus does not have standing to seek it. See Selby v. Principal Mutual Life Ins. Co., 197 F.R.D. 48, 64 (S.D.N.Y.2000) (stating that plaintiffs who were no longer participants in defendants’ insurance plan could not benefit from injunctive relief and thus did not have standing to seek it on behalf of class members). However valid this argument, it is only the tip of the iceberg; a larger standing problem lurks beneath the surface. Section 502(a)(3) of ERISA provides that a civil action may be brought “by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which violates any provision of this subchapter or the terms of the plan, or (B) to obtain any other appropriate equitable relief (i) to redress such violations or (ii) to enforce any provisions of this subchapter or the terms of the plan.” See 29 U.S.C. § 1132(a)(3) (2005). The Supreme Court *101has construed § 502 narrowly to allow only the stated categories of parties to sue for relief directly under ERISA. See Franchise Tax Board v. Construction Laborers Vacation Trust for S. Cal., 463 U.S. 1, 27, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983) (“ERISA carefully enumerates the parties entitled to seek relief under [§ 502(a)(3)]; it does not provide anyone other than participants, beneficiaries, or fiduciaries with an express cause of action.... ”). The Court has also held that § 502(a)(3) strictly limits the “universe of plaintiffs who may bring certain civil actions.” Harris Trust & Sav. Bank v. Salomon Smith Barney, Inc., 530 U.S. 238, 247, 120 S.Ct. 2180, 147 L.Ed.2d 187 (2000) (emphasis omitted). The Second Circuit has, of course, followed on these well-marked paths. See Chemung Canal Trust Co. v. Sovran Bank/Maryland, 939 F.2d 12, 14 (2d Cir.1991) (stating that § 1132(a) “names only three classes of persons who may commence an action,” including a participant or beneficiary, the Secretary of Labor, and a fiduciary); Pressroom Unions-Printers League Income Sec. Fund v. Continental Assurance Co., 700 F.2d 889, 892 (2d Cir.1983) (rejecting standing of plan itself on grounds that § 1132(a) limits standing to a participant, beneficiary or fiduciary). In her complaint, filed September 22, 2003, Mady conceded that she was a member of the Oxford Freedom Plan only from approximately April 1, 1997 through April 30, 2003. ERISA defines a “participant” as “any employee or former employee of an employer...who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer.... ” 29 U.S.C. § 1002(7) (2005). Thus, Mady was not a participant when her complaint was filed; her complaint establishes that her employer ceased to pay premiums on her account in March of 2002 when she lost her job as a result of downsizing and that her COBRA coverage was terminated on April 30, 2003. Participants can lose standing to sue if, despite their having suffered an alleged ERISA violation, their participant status has been terminated before suit is filed. Chemung, 939 F.2d at 15 (citing Katzoff v. Eastern Wire Products Co., 808 F.Supp. 96 (D.R.I.1992)). Because Mady extended her participation in the Oxford Freedom plan through COBRA only until April of 2003, and thus was not a participant when her complaint was filed on September 22, 2003, she lacks standing to sue under ERISA. Nor has Mady alleged that she may again become eligible for such benefits. In order to establish that she may become eligible for benefits, Mady must have a colorable claim that (1) she will prevail in a suit for benefits, or that (2) eligibility requirements will be fulfilled in the future. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 117-18, 109 S.Ct. 948, 103 L.Ed.2d 80 (1989). As a practical matter, Mady’s termination in a downsizing meant that she could no longer expect to receive health insurance from Oxford as a fringe benefit of her employment, thus effectively ending her future eligibility for continuing coverage under the Oxford Freedom Plan. Since Mady was no longer a participant, she no longer had an interest in seeking the equitable relief available under § 502(a)(3). With Mady’s claims dismissed for lack of standing, we turn to those of Nechis. The parties disagree as to whether Nechis’s claim is barred by a failure to exhaust administrative remedies. Some courts have held that exhaustion is not required for statutory claims,2 while others apply *102the exhaustion doctrine to both plan-based and statutory claims.3 See De Pace v. Matsushita Elec. Corp. of Am., 257 F.Supp.2d 543, 557-58 (E.D.N.Y.2003) (discussing circuit split). This circuit has not addressed the specific question whether exhaustion is required for statutory claims, but has consistently recognized that the primary purposes of the exhaustion requirement are to “(1) uphold Congress’ desire that ERISA trustees be responsible for their actions, not the federal courts; (2) provide a sufficiently clear record of administrative action if litigation should ensue; and (3) assure that any judicial review of fiduciary action (or inaction) is made under the arbitrary and capricious standard, not de novo." Davenport v. Harry N. Abrams, Inc., 249 F.3d 130, 132-34 (2d Cir.2001) (quoting Kennedy, 989 F.2d at 594). Nechis’s claims are equitable in nature and do not involve interpretation of the terms of her plan. “District courts in the Second Circuit have routinely dispensed with the exhaustion prerequisite where plaintiffs allege a statutory ERISA violation.” De Pace, 257 F.Supp.2d at 558 (E.D.N.Y.2003) (collecting cases). Nevertheless, because we find that the plaintiffs lack standing to sue and, as discussed below, that Nechis has not stated a legally cognizable claim, we need not here decide whether administrative exhaustion is a prerequisite to a statutory ERISA claim. B. Nechis’s Claims Fail on Their Merits Yet whatever the impact of Nechis’s failure to exhaust administrative remedies, summary judgment is still appropriate since, as the district court properly determined, none of her claims are legally cognizable under ERISA. 1. Breach of Fiduciary Duty and Request for Relief Under § 502(a)(3) of ERISA Nechis first contends that Oxford and Triad breached their fiduciary obligations imposed by § 404 of ERISA by denying, delaying or mishandling claims for chiropractic care and failing to disclose information to plan participants. Nechis seeks to remedy these practices by asserting a claim under § 502(a)(3) of ERISA, which authorizes civil actions “to enjoin any act or practice which violates... the terms of the plan, or... to obtain other appropriate equitable relief.” 29 U.S.C. § 1132(a)(3). On appeal, she argues that the district court improperly disregarded her request for equitable relief and wrongly concluded that restitution was not an available remedy. Nechis renews her demand for injunctive relief, corrective disclosures and reformation, and requests certain forms of “equitable” restitution. As the district court concluded, Nechis’s allegations with respect to disclosure violations and concerning reformation of claims resolution and appeals procedures are unavailing. Oxford has no duty to disclose to plan participants information additional to that required by ERISA; Ox*103ford is not bound to inform participants either that it has adopted cost-containment mechanisms or that it offers financial incentives for cost savings. See Ehlmann v. Kaiser Foundation Health Plan, 198 F.3d 552, 556 (5th Cir.2000) (dismissing plaintiffs argument that a duty to disclose financial incentives was implied by § 404 of ERISA); In re Managed Care Litigation, 150 F.Supp.2d 1330, 1356 (S.D.Fla.2001) (dismissing plaintiffs breach of fiduciary claims based on non-disclosure of cost-containment mechanisms and financial incentives). Nechis merely asserts that Oxford’s claims resolution and appeals procedures should be reformed; she does not specify the context of the requested reformation and she does not allege a basis for reformation such as fraud, mutual mistake or terms violative of ERISA. See, e.g., AMEX Assurance Co. v. Caripides, 316 F.3d 154, 161 (2d Cir.2003) (fraud and mutual mistake); DeVito v. Pension Plan of Local 819 I.B.T. Pension Fund, 975 F.Supp. 258, 267 (S.D.N.Y.1997) (reformation of plan that violated ERISA accrual provisions). The equitable relief available under § 502(a)(3) consists of those remedies “that were typically available in equity.” Great-West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204, 210, 122 S.Ct. 708, 151 L.Ed.2d 635 (2002) (internal citation omitted). On appeal, Nechis claims that injunctive relief would be appropriate to end Oxford’s allegedly deceptive practices, to correct its disclosures and to reform its claims resolution procedures. However, injunctive relief is generally appropriate only when there is an inadequate remedy at law and irreparable harm will result if the relief is not granted. The basic requirements to obtain injunctive relief have always been a showing of irreparable harm and the inadequacy of legal remedies. Ti-cor Title Ins. Co. v. Cohen, 173 F.3d 63, 68 (2d Cir.1999). Here, Nechis cannot satisfy the conditions required for injunctive relief; any harm to her can be compensated by money damages, and she could have pursued an alternative and effective remedy under § 502(a)(1)(B) of ERISA to recover the value of benefits wrongly denied. This leaves the question whether restitution is available as an equitable remedy under § 502(a)(3) of ERISA. Although Nechis seeks restitution, the Supreme Court, as the district court noted here, has stated that “almost invariably” suits seeking “to compel the defendant to pay a sum of money to the plaintiff are suits for ‘money damages.’ ” Great-West, 534 U.S. at 213, 122 S.Ct. 708 (internal quotation omitted). “A claim for money due and owing under a contract is quintessentially an action at law.” Id. The Supreme Court has delineated what forms of equitable restitution are available under § 502(a)(3), distinguishing permissible forms of equitable restitution such as employment of a constructive trust or of an equitable lien from forms of legal restitution. Id. Thus, a constructive trust or equitable lien is imposed when, “in the eyes of equity,” a plaintiff is “the true owner” of funds or property, and the “money or property identified as belonging in good conscience to the plaintiff [can] clearly be traced back to particular funds or property in the defendant’s possession.” Id. For the reasons aptly articulated by the district court, neither form of equitable restitution is involved here; the monies upon which Nechis seeks to impose a trust are premiums paid for health care coverage, which Oxford is under no obligation to segregate and which Nechis does not allege to be segregated in a separate account. Moreover, the language of Nechis’s request for relief involves words of contract rather than those of equity, a cireum-*104stance that undermines her claim that the district court misconstrued the nature of the relief that she has sought. Since early on, Nechis has complained that she did not “receive[ ] the benefit of the bargain” and has requested “disgorgement of ill-gotten gains” and “restitution of premiums paid.” And she persists in seeking money damages under a theory of “unjust enrichment,” alleging that ERISA’s remedies must be supplemented by the federal common law since the statute does not provide adequate relief in the present circumstances. We decline this invitation to perceive equitable clothing where the requested relief is nakedly contractual. 2. Breach of Disclosure Obligations Under §§ 102 and 101 of ERISA. Nechis also alleges that Oxford failed to disclose that its decisions on chiropractic coverage were not based solely on medical necessity but instead invoked undisclosed cost-based criteria, that it provided financial incentives to Triad to deny chiropractic claims and that it intentionally and unreasonably delayed payment of covered claims to earn greater interest on premiums. Section 104(b) of ERISA requires that plan administrators provide notification to participants of any material reduction in benefits or services within 60 days of their effective date. 29 U.S.C. § 1024(b)(1)(B). ERISA defines an “administrator” either as someone who is “specifically designated” by plan documents or the plan sponsor; if no administrator is designated and no plan sponsor is identified, the administrator is “such other person as the Secretary may by regulation prescribe.” 29 U.S.C. § 1002(16)(A). When “an employee benefit plan is established or maintained by a single employer,” the “plan sponsor” is the employer. 29 U.S.C. § 1002(16)(B)(I). However, as the district court recognized, Nechis concedes that Oxford meets none of these criteria and is therefore not the plan administrator,4 and therefore does not have the disclosure obligations alleged. For much the same reasons as apply to Oxford, the allegations against Triad fail, whether or not Triad is deemed to be a fiduciary, as Nechis alleges. 3. Leave to Amend Finally, the plaintiffs contend that the district court erred in not granting them leave to amend their complaint. We review a denial of leave to amend for abuse of discretion. Koehler v. Bank of Bermuda (New York) Ltd., 209 F.3d 130, 138 (2d Cir.2000). There is no abuse of discretion here; not only does Mady lack standing to sue under ERISA, but Nechis’s claims also fail on their merits. We do not see how these deficiencies can be supplied by amendment. III. For all these reasons, we AffiRM the dismissal of these claims.. In its August 4, 2004 order granting summary judgment to defendants, the district court stated that Mady continued her COBRA coverage for 18 months, paying $276.44 each month. However, in her complaint dated September 22, 2003, Mady states that she was a member of the Oxford Freedom Plan only through April 30, 2003.. See, e.g., Smith v. Sydnor, 184 F.3d 356, 364-65 (4th Cir.1999); Chailland v. Brown & *102Root, Inc., 45 F.3d 947 (5th Cir.1995); Richards v. General Motors Corp., 991 F.2d 1227 (6th Cir.1993); Held v. Manufacturers Hanover Leasing Corp., 912 F.2d 1197 (10th Cir.1990); Zipf v. American Telephone & Telegraph Co., 799 F.2d 889, 891-92 (3d Cir.1986); Amaro v. Continental Can Co., 724 F.2d 747, 749-50 (9th Cir.1984). These cases also note that § 503 of ERISA, the origin of the exhaustion doctrine, refers only to procedures regarding claims for benefits. See, e.g., Zipf, 799 F.2d at 891.. See, e.g., Mason v. Continental Group, Inc., 763 F.2d 1219, 1227 (11th Cir.1985); Kross v. Western Electric Co., 701 F.2d 1238 (7th Cir.1983). However, the Seventh Circuit now permits district courts in their discretion to decide whether exhaustion should be required in a given case. See Lindemann v. Mobil Oil Corp., 79 F.3d 647, 649-50 (7th Cir.1996).. In her Memorandum in Opposition to Defendants’ Motion to Dismiss, Nechis states that "Oxford does not designate a plan administrator in its Certificates of Coverage, or identify the plan administrator with respect to the plaintiffs’ plans. ERISA provides that when a Plan Administrator is not so designated, the employer is the default plan administrator.” This statement acknowledges in effect that Oxford cannot be the administrator.
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CONFLICT_NOTED
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724 F.2d 747
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398 F.3d 765
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C
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Santiago Amaro v. The Continental Can Company
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OPINION FORESTER, Chief Judge. The Defendant Pfizer, Inc. (“Pfizer”) herein appeals the District Court’s ruling on its motion to dismiss the claims of Plaintiff Joseph Simon (“Simon”). Pfizer argues that the District Court erred in failing to dismiss Simon’s four-count complaint concerning allegedly improper refusal of, and interference with the attainment of, benefits under the Warner-Lambert Company Enhanced Severance Plan (“ESP”) because the ESP mandates that such disputes be decided in an arbitral, not judicial, forum and because Simon failed to exhaust internal administrative remedies. We REVERSE, in part, AFFIRM, in part, and REMAND for the reasons set forth in this opinion. BACKGROUND Simon was employed by Warner-Lambert Company (“Warner-Lambert”) from 1989 until May of 2002. Prior to the merger of Warner-Lambert and Pfizer in May of 2000, Warner-Lambert adopted the ESP, which was designed to protect the job security of its employees in the event of a merger with another company. The ESP provides for the payment of enhanced severance benefits to certain eligible employees under limited circumstances that result in an “Activation Event” within two years of a “Change in Control.” This two-year period is sometimes referred to as the “protected period.” An “Activation Event” is either a “Constructive Termination” or an actual termination other than for “Just Cause.” A “Change of Control” within the meaning of the ESP occurred when Pfizer and Warner-Lambert merged in May of 2000. Under the ESP, “Termination for Just Cause” is defined as “termination for the commission of a wrongful action such as theft of Company property or alcohol or drug abuse.” A “Constructive Termination” is defined, in relevant part, in the ESP as a “substantive change in job duties” or “change in reporting relationship” occurring after a change in control. Under the ESP, the Plan Administrator has the authority to interpret the ESP’s terms. Near the end of the protected period, in May of 2002, Simon was terminated for accessing information contained in his manager’s computer without authorization. *768 Simon claims that the information accessed consisted of an organizational chart that he reviewed in an attempt to determine whether he was eligible for Constructive Termination benefits based on a change in his reporting relationship under the ESP. Simon further asserts that he was granted access to the area of the corporate network where he viewed this information and that no Pfizer policies or procedures prohibited his conduct. On July 8, 2002, Simon submitted a request for benefits under the ESP, alleging Constructive Termination based on an alleged change in reporting relationship and Actual Termination other than for Just Cause. By letter dated July 9, 2002, Simon’s attorney notified Pfizer that Simon demanded reinstatement to his position at Pfizer because his termination was, allegedly, in retaliation for, and an interference with, Simon’s exercise and attainment of his rights under the ESP. J.A. p. 235. In order for a plan participant to seek severance benefits under the ESP based on Constructive Termination or to contest a Termination for Just Cause, he must submit his claim(s) to the ESP Plan Administrator. The Plan Administrator reviews all claims and renders a determination through a three-step review process. The review process takes place in this order: (1) the participant completes a Constructive Termination form and files it with the Plan Administrator, who, after an internal review, forwards the claim to the ESP Advisory Group; (2) the participant may appeal to the ESP Administrative Committee; and (3) the participant may appeal to the Senior Vice President of Corporate Human Resources. If the participant is not satisfied with the outcome of this three-step review process, the ESP flow chart indicates that arbitration may be initiated. The chart clearly states that a participant “can proceed to arbitration only if [the participant] ha[s] completed the above three steps of the internal ESP process.” J.A. p. 101. Pursuant to the ESP, any unsuccessful participant must submit his or her claim(s) to arbitration before the American Arbitration Association (“AAA”) regardless of whether they are claims of Actual Termination for Just Cause 1 or Constructive Termination. 2 The results of arbitration are binding on Pfizer (and Warner-Lambert) and on the participant. J.A. p. 101. Simon commenced this suit in the Eastern District of Michigan on September 24, 2002, prior, to resolution of his claims in the three-step administrative process. His complaint contains counts for retaliatory discharge and discrimination in violation of ERISA § 510, codified at 29 U.S.C. § 1140 (Count I), 3 improper denial of plan benefits *769 (Count II), breach of fiduciary duty in violation of 29 U.S.C. § 1132(a)(3) (Count III), and failure to provide timely and proper notice of COBRA benefits pursuant to 29 U.S.C. §§ 1161, 1166 (Count IV). 4 Thereafter, on November 12, 2002, Pfizer filed a motion to dismiss all counts of the complaint based on the ESP’s mandatory arbitration provisions and on Simon’s failure to exhaust his administrative remedies. Alternatively, Pfizer requested that the District Court stay litigation of Simon’s claims until the resolution of his claims filed with Pfizer for benefits under the ESP. At the time of oral argument on Pfizer’s motion to dismiss, Simon’s administrative claims filed with Pfizer for benefits (for Constructive Termination and Actual Termination under the ESP) were winding through the three-step administrative process established by the ESP. Pfizer repre *770 sented to the District Court that the ESP Advisory Group informed Simon by letter dated January 23, 2003, of its decision to deny Simon’s claim for benefits based on Constructive Termination, thus completing the first level of review. J.A. pp. 441-443; Pfizer’s Motion to Supplement the Record, Exhibit 3. Pfizer further represented that it was continuing to follow the internal review procedures with respect to Simon’s claim for benefits based on Actual Termination. J.A. pp. 441-443. The District Court denied Pfizer’s motion to dismiss with respect to all but Count III (breach of fiduciary duty). The District Court refused to require exhaustion of administrative remedies as to Simon’s ERISA Section 510 (Count I) and COBRA (Count IV) claims on the basis that said claims are statutory and are thus separate and apart from Simon’s claim under the ESP. The court ruled that Simon’s failure to exhaust his administrative remedies was excused on the basis of futility for Simon’s claim for wrongful denial of ESP benefits (Count II) and also held that arbitration was not required. 5 The Court did, however, dismiss Simon’s fiduciary duty claim (Count III). Pfizer timely appealed the District Court’s ruling, arguing that Simon should be required to both exhaust his administrative remedies and arbitrate his claims. 6 On February 19, 2003, Simon filed an administrative appeal from the denial of Constructive Termination benefits. Simon then received a March 17, 2003, letter regarding his Actual Termination claim, advising him of the determination of the ESP Advisory Group (the first level of review) that he had been terminated for Just Cause and was therefore ineligible for benefits under the ESP. Thereafter, the Administrative Committee, at the second level of review, again denied Simon’s Constructive Termination claim on June 1, 2003. Simon appealed both his Constructive Termination and Actual Termination claims to the final level of review — Robert Norton, Senior Vice President of Corporate Human Resources — on June 27, 2003, attempting to skip the Administrative Committee review (the second level of review) of his Actual Termination claim. See Pfizer’s Motion to Supplement the Record, Exhibit 1-3. *771 DISCUSSION 1. Appellate Jurisdiction As an initial matter, we note that this Court has appellate jurisdiction over all “final decisions” of the district courts, 28 U.S.C. § 1291; however, the District Court’s partial denial of Pfizer’s motion to dismiss is not a “final” order that is ap-pealable under 28 U.S.C. § 1291. See Gulfstream Aerospace Corp. v. Mayacamas Corp., 485 U.S. 271, 275, 108 S.Ct. 1133, 99 L.Ed.2d 296 (1988) (In general, an order denying a motion to dismiss is not final because it “ensures that litigation will continue in the District Court.”). 7 Notwithstanding, an appeal of such an order may be taken if it falls within the small class of orders that are final for purposes of 28 U.S.C. § 1291 under the “collateral order doctrine” established in Cohen v. Beneficial Industrial Loan Corp., 337 U.S. 541, 546, 69 S.Ct. 1221, 93 L.Ed. 1528 (1949) (noting that the collateral order doctrine embraces the “small class [of orders] which finally determine claims of right separable from, and collateral to, rights asserted in the action, too important to be denied review and too independent of the cause itself to require that appellate consideration be deferred until the whole case is adjudicated”). An order that does not finally resolve a case fits within the collateral order doctrine if the order: (1) “conclusively de-terminéis] the disputed question,” (2) “re-solvéis] an important issue completely separate from the merits of the action,” and (3)is “effectively unreviewable on appeal from a final judgment.” Gulfstream Aerospace, 485 U.S. at 276, 108 S.Ct. 1133 (citations omitted). If the order at issue fails to satisfy any one of those requirements, it is not appealable under the collateral order exception. Id. See Decker v. IHC Hospitals, Inc., 982 F.2d 433, 435 (10th Cir.1992). In this case, the District Court based its partial denial of Pfizer’s motion to dismiss on two grounds, ruling that Simon was excused from exhausting his administrative remedies on the basis of futility and finding that Simon’s claims were not subject to arbitration. Pfizer appeals on both grounds. Because the District Court’s ruling on the exhaustion issue is not conclusive with respect to Simon’s underlying claims and because it is effectively reviewable on appeal from a final judgment, 8 it does not fit within the collateral order doctrine and thus this Court does not have appellate jurisdiction to review the District Court’s ruling on that ground. 9 However, because Pfizer *772 appeals, in part on the District Court’s refusal to enforce, through dismissal or stay, an agreement to arbitrate, this Court has independent jurisdiction over that question under the Federal Arbitration Act (“FAA”), 9 U.S.C. § 16, and Rule 4 of the Federal Rules of Appellate Procedure. 2. Arbitration District Court decisions on motions to dismiss under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6) are generally subject to a de novo standard of review. See, e.g., Tahfs v. Proctor, 316 F.3d 584, 590 (6th Cir.2003); Ziegler v. IBP Hog Market, Inc., 249 F.3d 509, 511-12 (6th Cir.2001). The standard of review for a district court’s decision regarding whether a dispute is arbitrable is also de novo. Haskins v. Prudential Ins. Co. of Am., 230 F.3d 231, 234 (6th Cir.2000). Pfizer attacks the District Court’s ruling regarding the arbitrability of Simon’s claims, arguing that his claim for wrongful denial of benefits under the ESP (Count II) is expressly covered by the arbitration provisions of the ESP, and that his statutory claims (Count I, III and IV), while not expressly covered, are sufficiently connected to the claim of wrongful denial of benefits that arbitration should be required. 10 Simon responds that the arbitration agreement contained in the ESP is limited, applying only to disputes concerning Constructive Termination. In support of this contention, Simon points to language contained in Section 20.3 of the ESP, which provides: “[a]ll disputed [sic] regarding the application of this Section 20 shall be submitted to an Arbitration Panel whose findings shall be binding on the Company and the Participant.” J.A. p. 54. Section 20 deals exclusively with Constructive Termination and the meaning and application of that term with respect to benefits eligibility. Simon ignores, however, similar language contained in Section 14 of the ESP, which clearly mandates arbitration with respect to disputes concerning Termination for Just Cause. Section 14 is titled “Termination for Just Cause,” and, likewise, states in pertinent part: “[t]he determination of whether alleged grounds for termination qualify as Termination for Just Cause shall be made by an Arbitration Panel.” J.A. p. 52. Thus, contrary to Simon’s argument, the ESP expressly mandates arbitration for disputes concerning both Constructive Termination and Termination for Just Cause. The central inquiry, therefore, is whether Simon’s claims sufficiently fit *773 within the ESP’s arbitration clauses such that arbitration should be required. 11 With respect to Simon’s ESP claims, this Court finds that they do and, thus, the District Court’s decision denying Pfizer’s motion to dismiss with respect to Simon’s ESP claims must be overturned — a compulsory arbitration provision divests the District Court of jurisdiction over claims that seek benefits under an ERISA plan, such as the ESP. See United Steelworkers v. Mead Corp., 21 F.3d 128, 132-33 (6th Cir.1994) (refusing to consider the merits of a claim after determining the claim was within the scope of the parties’ arbitration agreement). 12 A. Wrongful Denial of Benefits (Count II) Count II of the complaint alleges that Simon was constructively and involuntarily terminated and that Pfizer wrongly failed to respond to his requests for involuntary and Constructive Termination benefits under the ESP. J.A. p. 9-10. 13 To the contrary, Simon’s claims filed internally with Pfizer were being addressed, 14 and any disputes regarding the resolution of said claims are clearly governed by the arbitration provisions in the ESP. As noted above, the ESP contains mandatory arbitration provisions governing all claims for benefits for Constructive Termination or Actual Termination for Just Cause. It is undisputed that Simon has refused to proceed to arbitration as required with regard to any of these claims. Under a de novo standard of review, and based on policies favoring arbitration, 15 this Court *774 finds that the District Court erred in denying Pfizer’s motion to dismiss with respect to Simon’s claim for benefits under the ESP (Count II) — the subject matter of this claim must be arbitrated pursuant to the ESP under -which Simon claims an entitlement to benefits. B. ERISA Section 510 (Count I) and COBRA Claims (Count IV) Next, an inquiry must be made with respect to Simon’s ERISA Section 510 and COBRA claims. Simon claims that the information he accessed on his manager’s computer without authorization (for which conduct he was terminated) was information pertaining to his eligibility for benefits under the ESP. Simon thus argues that he was terminated for attempting to determine his rights and benefits under the ESP in violation of ERISA Section 510, see 29 U.S.C. § 1140,-which prohibits employer conduct engaged in for the purpose of interfering with an employee’s attainment of benefits. Simon also alleges, a COBRA notice violation under 29 U.S.C. §§ 1161, 1166, in that Pfizer was tardy in providing Simon notice of his COBRA rights, elections and benefits. Simon contends that, because these claims arise under ERISA, they are not within the scope of the ESP arbitration mandate. Thus, this Court must tangentially consider the narrow issue of whether ERISA preempts arbitration under the FAA. This narrow issue has not yet been addressed by the Sixth Circuit, see Eckel v. Equitable Life Assur. Soc. of the U.S., 1 F.Supp.2d 687, 688 (noting that the Sixth Circuit had not yet addressed the issue); however, the majority of courts considering this issue have held that disputes arising under ERISA, including COBRA claims, are subject to arbitration under the FAA. See Kramer v. Smith Barney, 80 F.3d 1080, 1084 (5th Cir.1996); Pritzker v. Merrill Lynch, Pierce, Fenner & Smith, Inc., 7 F.3d 1110, 1115-16 (3d Cir.1993); Bird v. Shearson Lehman/American Express, Inc. 926 F.2d 116, 122 (2d Cir.1991), cert. denied 501 U.S. 1251, 111 S.Ct. 2891, 115 L.Ed.2d 1056 (1991); Arnulfo P. Sulit, Inc. v. Dean Witter Reynolds, Inc., 847 F.2d 475, 479 (8th Cir.1988); Peruvian Connection, Ltd. v. Christian, 977 F.Supp. 1107, 1111 (D.Kan.1997); Fabian Fin. Serv. v. Kurt H. Volk, Inc. Profit Sharing Plan, 768 F.Supp. 728, 733-34 (C.D.Cal.1991); Southside Internists Group PC Money Purchase Pension Plan v. Janus Capital Corp., 741 F.Supp. 1536, 1541-42 (N.D.Ala.1990); Glover v. Wolf, Webb, Burk & Campbell, Inc., 731 F.Supp. 292, 293 (N.D.Ill.1990). 16 Notwithstanding the *775 foregoing, the following discussion reveals why this issue need not be resolved herein. A longstanding principle of this Circuit is that no matter how strong the federal policy favors arbitration, “arbitration is a matter of contract between the parties, and one cannot be required to submit to arbitration a dispute which it has not agreed to submit to arbitration.” United Steelworkers, Local No. 1617 v. Gen. Fireproofing Co., 464 F.2d 726, 729 (6th Cir.1972). See also AT & T Techs., Inc. v. Communications Workers of America, 475 U.S. 643, 648, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986) (“[A]rbitration is a matter of contract and a party cannot be required to submit to arbitration any dispute which he has not agreed so to submit.”); Bratt Enters., Inc., v. Noble Int’l Ltd., 338 F.3d 609, 612 (6th Cir.2003); Roney & Co. v. Kassab, 981 F.2d 894, 897 (6th Cir.1992). This Court has drawn a clear line between the extensive applicability of general arbitration provisions and the more narrow applicability of arbitration clauses tied to specific disputes. When faced with a broad arbitration clause, such as one covering any dispute arising out of an agreement, a court should follow the presumption of arbitration and resolve doubts in favor of arbitration. See Masco Corp. v. Zurich Am. Ins. Co., 382 F.3d 624, 627 (6th Cir.2004). Indeed, in such a case, “only an express provision excluding a specific dispute, or the most forceful evidence of a purpose to exclude the claim from arbitration, will remove the dispute from consideration by the arbitrators.” Id. at 627 (internal quotations and citation omitted). However, when an arbitration clause by its terms extends only to a specific type of dispute, then a court cannot require arbitration on claims that are not included. See Bratt Enters., Inc., 338 F.3d at 613. Passing to the central inquiry, this Court must determine whether the arbitration provisions contained in the ESP herein at issue are broad enough to encompass Simon’s ERISA Section 510 and COBRA claims. The ESP does not contain a general arbitration provision under which the parties agreed to arbitrate all disputes arising from the employment relationship. The arbitration provisions in the ESP are admittedly narrower and are contained specifically in the sections of the document concerning Constructive Termination and Actual Termination. J.A. pp. 52, 53. In other words, only two types of disputes are subject to arbitration under the ESP — disputes regarding the application of Section 20 dealing with Constructive Termination and disputes concerning *776 the application of Section 14 dealing with Termination for Just Cause. Neither of these ESP sections anywhere refers to ERISA or COBRA, and therefore, as an initial matter, it is clear that Simon’s ERISA Section 510 and COBRA claims are not within the scope of any general or specific arbitration provision. Even assuming that Simon’s statutory claims arise from the same factual underpinnings as his claim for wrongful denial of benefits under the ESP, it does not necessarily follow that the ERISA claims must also be arbitrated. The question of whether or not Simon’s ERISA claims share facts with the arbitra-ble claims is not necessarily determinative of arbitrability of the ERISA claims. Where one claim is specifically covered by an arbitration agreement, and a second claim is not, the arbitrability of the second is governed by the extent to which the second claim is substantially identical to the first. On the one hand, a party cannot avoid arbitration simply by renaming its claims so that they appear facially outside the scope of the arbitration agreement. See Fazio v. Lehman Bros., Inc., 340 F.3d 386, 395 (6th Cir.2003). In order to determine whether such renaming has occurred, a court must examine the underlying facts — when an otherwise arbitrable claim has simply been renamed or recast it will share the same factual basis as the arbitrable claim. However, a claim that is truly outside of an arbitration agreement likewise cannot be forced into arbitration, even though there may be factual allegations in common. In particular, the determination that a claim “require[s] reference” to an arbitrable issue or factual dispute is not determinative. Bratt Enters., Inc., 338 F.3d at 613. Bratt Enterprises is particularly instructive as to how much factual overlap there may be without requiring arbitration of disputes not expressly subject to arbitration. In Bratt Enterprises, the arbitration clause covered disagreements relating to “any of the amounts included in the Closing Balance Sheet” of an asset purchase agreement transaction. Id. at 612-13. The parties ultimately had numerous disputes, and in a lawsuit filed by Bratt Enterprises, the Defendant Noble International, Inc. counterclaimed for breach of contract. Part of the breach of contract claim centered around a provision under which Bratt Enterprises retained accounts payable in excess of $1.2 million. Noble International’s closing balance sheet reflected accounts payable of over $1.8 million, but despite the $1.2 million limit, Bratt Enterprises disputed and sought to avoid payment of the $.6 million difference back to Noble. Because the breach of contract claim by Noble was therefore related to a balance sheet dispute, the district court ordered arbitration on the breach of contract claim in addition to the dispute over the actual accounts payable balance. Id. at 611-13. This Court reversed, holding that [w]hile Noble’s claim would obviously require reference to the closing balance sheet to determine matters of valuation should Noble prevail on this issue, the dispute regarding the validity of the [$1.2 million] limitation provision does not itself involve a “disagree[ment] with any of the amounts included in the Closing Balance Sheet.”... Thus, this aspect of Noble’s breach of contract claim is not within the scope of the arbitration clause and is, therefore, not arbitrable. Id. at 613. Nor was this result altered by the fact that ordering arbitration on the dispute over the proper amount of accounts payable and refusing to order arbitration on the breach of contract claim resulted in “piecemeal litigation.” Id. at 613. As noted above, although Simon’s claims are intermingled, this does not support the *777 conclusion that arbitration is necessarily required. Even if Simon were terminated for Just Cause, he would not necessarily be ineligible for COBRA benefits. Although it is true that COBRA expressly excludes termination for “gross misconduct” from the list of qualifying events, it does not follow that a termination for Just Cause under the ESP would necessarily be a termination for gross misconduct. Section 14 of the ESP states that: “ ‘Termination for Just Cause’ shall mean termination for the commission of a wrongful act such as theft of Company property or alcohol or drug abuse.” J.A. p. 52. This is not synonymous with the definition of gross misconduct, and different courts apply different standards. See, e.g., Chatterjee v. School Dist. of Philadelphia, 170 F.Supp.2d 509, 518 (E.D.Pa.2001) (recog-, nizing that there is no definition of “gross misconduct”). Therefore, it is possible that the arbitrator could decide that Simon had been terminated for just cause, while, in litigation, a court could determine that Simon had not been terminated for gross misconduct and was, therefore, eligible for COBRA notification and benefits. Returning to the question of whether arbitration is required because of the remaining degree of factual overlap, this case is sufficiently analogous to Bratt Enterprises so that the same result should be reached. Simon’s ERISA Section 510 and COBRA claims require consideration of some factual issues that are subject to arbitration, but the claims have independent legal bases. The Section 510 claim and COBRA claim are not simply claims for violations of the ESP that have been recharacterized in order to avoid arbitration; rather, they are independent claims that are statutorily authorized and that depend upon different legal standards. As discussed above, Simon’s COBRA claim could be resolved in his favor even if he loses the arbitration regarding his ESP claims. In other words, there is no greater degree of issue overlap than was the case in Bratt. In Bratt, the actual amount of the accounts payable could have controlled the entire breach of contract dispute had the arbitrator determined that the amount was equal to the $1.2 million cap and not in excess of it. The amount of recovery that Noble International would be entitled to if it prevailed depended upon the figure the arbitrator assigned to the accounts payable. In this case, as in Bratt, it is appropriate to permit litigation of the independent claims even though they may require some reference to the decision reached by the arbitrator. Only the desire to avoid piecemeal litigation counsels in favor of requiring arbitration, and that desire is legally insufficient under Bratt. ■Therefore, because Simon’s-ERISA Section 510 and COBRA claims are not covered by the arbitration clauses at issue, it is not necessary 'to address the question of whether ERISA would pre-empt an arbitration clause that did cover those claims. Thus, based on the de novo standard of review, this Court finds that Simon’s ERISA and COBRA claims (Counts I and TV) are not subject to arbitration in this case and, therefore, the District Court did not err in failing to require arbitration with respect to those claims. CONCLUSION For the foregoing reasons, this Court REVERSES the District Court with respect to denying Pfizer’s motion to dismiss Simon’s claim for benefits under the ESP, AFFIRMS the District Court’s decision regarding the arbitrability of Simon’s Section 510 and Cobra claims; arid REMANDS for proceedings not inconsistent with this opinion. 1. See J.A. p. 52 ("The determination of whether alleged grounds for termination qualify as a Termination for Just Cause shall be made by an Arbitration Panel”). 2. ' See J.A. p. 53 (stating that the term "Constructive Termination” shall include "any other action which shall be determined by an Arbitration Panel to constitute a Constructive Termination”). 3. Title 29, Section 1140 of the United States Code, titled "Interference with protected rights,” states as follows: It shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary for exercising any right to which he is entitled under the provisions of an employee benefit plan, this subchapter, section 1201 of this title, or the Welfare and Pension' Plans Disclosure Act [29 U.S.C.A. §§ '301 et seq.], or for the purpose of interfering with the attainment of any right to which such participant may become entitled under the plan, this subchapter, or the Welfare and Pension Plans Disclosure Act. It shall be unlawful for any person to discharge, fine, suspend, expel, or discriminate against any person because he has given information or has testified or is about to testify in any inquiry or proceeding relating to this chapter or the Welfare and *769 Pension Plans Disclosure Act. The provisions of section 1132 of this title shall be applicable in the enforcement of this section. Id. 4. The notice requirements set forth in 29 U.S.C. § 1166 provide: (a)In general In accordance with regulations prescribed by the Secretary— (1) the group health plan shall provide, at the time of commencement of coverage under the plan, written notice to each covered employee and spouse of the employee (if any) of the rights provided under this subsection, (2) the employer of an employee under a plan must notify the administrator of a qualifying event described in paragraph (1), (2), (4), or (6) of section 1163 of this title within 30 days (or, in the case of a group health plan which is a multiemployer plan, such longer period of time as may be provided in the terms of the plan) of the date of the qualifying event, (3) each covered employee or qualified beneficiary is responsible for notifying the administrator of the occurrence of any qualifying event described in paragraph (3) or (5) of section 1163 of this title within 60 days after the qualifying event and each qualified beneficiary who is determined, under title II or XVI of the Social Security Act [42 U.S.C.A. §§ 401 et seq. or 1381 et seq.], to have been disabled at any time during the first 60 days of continuation coverage under this part is responsible for notifying the plan administrator of such determination within 60 days after the date of the determination and for notifying the plan administrator within 30 days after the date of any final determination under such title or titles that the qualified beneficiary is no longer disabled, and (4)the administrator shall notify- (A) in the case of a qualifying event described in paragraph (1), (2), (4), or (6) of section 1163 of this title, any qualified beneficiary with respect to such event, and (B) in the case of a qualifying event described in paragraph (3) or (5) of section 1163 of this title where the covered employee notifies the administrator under paragraph (3), any qualified beneficiary with respect to such event, of such beneficiary’s rights under this subsection. (b) Alternative means of compliance with requirements for notification of multiem-ployer plans by employers The requirements of subsection (a)(2) of this section shall be considered satisfied in the case of a multiemployer plan in connection with a qualifying event described in paragraph (2) of section 1163 of this title if the plan provides that the determination of the occurrence of such qualifying event will be made by the plan administrator. (c) Rules relating to notification of qualified beneficiaries by plan administrator For purposes of subsection (a)(4) of this section, any notification shall be made within 14 days (or, in the case of a group health plan which is a multiemployer plan, such longer period of time as may be provided in the terms of the plan) of the date on which the administrator is notified under paragraph (2) or (3), whichever is applicable, and any such notification to an individual who is a qualified beneficiary as the spouse of the covered employee shall be treated as notification to all other qualified beneficiaries residing with such spouse at the time such notification is made. Id. 5. Specifically, the Court stated: "[t]he other issue that remains is, which I think is actually taken off my prior words, but is whether plaintiff's complaint should be dismissed for failure to arbitrate, and the Court finds under the same reasoning [as that applied with respect to exhaustion] that you'd never get to arbitration since there’s no response from the company." J.A. p. 448. 6. Lastly, and in the alternative, Pfizer argues that the District Court erred in refusing to stay the litigation of all claims until such time as the parties conclude their arbitration. Pfizer did not, however, present the District Court with a separate motion to stay proceedings, but rather included the request in a footnote to its brief in support of its motion to dismiss as an alternative remedy to dismissing Simon's claims. See J.A. p. 29, Pfizer’s Brief in Support of its Motion, n. 3 ("At a minimum, the Court should stay the action pending arbitration of all or any part of these claims”). The District Court did not therefore explicitly make a ruling on this request, and as the court found that neither arbitration nor exhaustion was required with respect to any of Simon’s claims, there would have been no reason to grant a stay pending arbitration— no arbitration of claims was being required. J.A. p. 446-448. As furdier evidence that this is a non-issue, Simon does not even address this argument in his brief. See Appellee's Brief. Neither was Pfizer's request to stay considered at a later date. The next motion considered by the Court was on February 19, 2003, when it considered Pfizer’s motion for a stay pending appeal. J.A. p. 455. Because the District Court did not reach the question of whether a sta}' should be required pending arbitration, the issue is not properly before this Court. Based on this Court's ruling herein, however, this question may become pertinent on remand. 7. See also, e.g., Suarez Corp. Indus. v. McGraw, 125 F.3d 222, 225 (4th Cir.1997) ("Ordinarily, appellate jurisdiction is lacking to hear an appeal from an order denying a Rule 12(b)(6) motion to dismiss since such an order is interlocutory in nature"); Hill v. City of New York, 45 F.3d 653, 659 (2d Cir.1995)("a denial of a motion to dismiss is ordinarily considered non-final, and therefore not immediately appealable”). 8. See Stewart v. Oklahoma, 292 F.3d 1257, 1260 (10th Cir.2002) (noting that the collateral order doctrine did not apply, preventing the court from reviewing the district court's denial of motion to dismiss on the basis of exhaustion because the third requirement of that doctrine, that the question be effectively unreviewable after final judgment, was not met — the "exhaustion claim, rests on less urgent questions of statutory interpretation and equitable considerations effectively reviewable after final judgment”). 9.Neither does the doctrine of pendent appellate jurisdiction allow us to consider the issue of exhaustion because that issue is not "coterminous with, or subsumed in” the arbitration issue. U.S. v. Any and All Radio Station Transmission Equipment, 204 F.3d 658, 668 (6th Cir.2000). See also Brennan v. Township of Northville, 78 F.3d 1152, 1157-58 (6th Cir.1996) (pendent jurisdiction exists "where the appealable and non-appealable issues are 'inextricably intertwined’,” meaning "when... resolution of the collateral appeal necessarily *772 resolves the pendent claim as well”); Chambers v. Ohio Dep’t of Human Servs., 145 F.3d 793, 797 (6th Cir.1998) ("pendent appellate jurisdiction... only may be exercised when the appealable issue at hand cannot be resolved without addressing the nonappealable collateral issue”). 10. Although the District Court did not give a separate analysis with respect to the question of arbitrability, it appears from what the court did say that it based its ruling on the assumption that Pfizer had not responded to the claims Simon had filed with the company internally, and that, therefore, forcing Simon to arbitrate the claims before the district court would have been futile. The court was concerned that Pfizer had not yet, at the time of the hearing on Pfizer’s motion to dismiss, reached a decision at the first level of review on Simon's Actual Termination claim filed internally with the company. After explaining why, based on that fact, exhaustion was futile for Simon's claim of wrongful denial of benefits under the plan, J.A. pp. 446-447, the court stated: "[t]he other issue that remains is, which I think is actually taken off my prior words, but is whether plaintiff's complaint should be dismissed for failure to arbitrate, and the Court finds under the same reasoning [as that applied with respect to exhaustion] that 'you’d never get to arbitration since there’s no response from the company.” J.A. p. 448. 11. See Toledo Technologies, Inc. v. INA Walzlager Schaeffler, 1999 WL 681557, *2 (N.D.Ohio 1999) ("In ruling on such a motion, a court must first determine if the parties actually agreed to arbitrate the issue in question.") (citing Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc., 473 U.S. 614, 626, 105 S.Ct. 3346, 87 L.Ed.2d 444 (1985); and AT & T Technologies v. Communications Workers, 475 U.S. 643, 650, 106 S.Ct. 1415, 89 L.Ed.2d 648 (1986) (noting that with respect to arbitration the parties’ intentions control, but that there is an initial presumption of arbitrability)). 12. The following language from the Mead decision is extremely pertinent herein: [W]here the agreement contains an arbitration clause, the court should apply a presumption of arbitrability, resolve any doubts in favor of arbitration, and should not deny an order to arbitrate "unless it may be said with positive assurance that the arbitration clause is not susceptible of an interpretation that covers the asserted dispute.” See AT & T Technologies, Inc. v. Communications Workers, 475 U.S. 643, 648-51, 106 S.Ct. 1415, 1418-19, 89 L.Ed.2d 648 (1986) (quoting United Steelworkers of America v. Warrior & Gulf Navigation, Co., 363 U.S. at 582-83, 80 S.Ct. at 1353 (1960)). Moreover, in cases involving broad arbitration clauses the [U.S. Supreme] Court has found the presumption of arbitrability "particularly applicable," and only an express provision excluding a particular grievance from arbitration or "the most forceful evidence of a purpose to exclude the claim from arbitration can prevail.” Id., 475 U.S. at 650, 106 S.Ct. at 1419 (quoting Warrior & Gulf Navigation, 363 U.S. at 584-85, 80 S.Ct. 1347); see also International Union, UAW v. United Screw & Bolt Corp., 941 F.2d 466, 472-73 (6th Cir.1991) (finding that the employer had "not satisfied the requirement for forceful evidence to overcome the presumption that the grievances should be arbitrated”). United Steelworkers of America v. Mead Corp., 21 F.3d at 131. 13. Simon claims that1 this alleged improper denial of benefits is in violation of ERISA. 29 U.S.C. § 1132(a)(1)(B) allows a participant or beneficiary to pursue a civil action to recover benefits due him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan. Id. 14. See supra, pp. 6 -7. 15. Consider this excerpt: The Federal Arbitration Act (FAA) provides for the compulsory arbitration of disputes covered by a valid arbitration agreement. 9 U.S.C. § 2; see also Shearson/American Express, Inc. v. McMahon, 482 U.S. 220, 107 S.Ct. 2332, 96 L.Ed.2d 185 (1987). *774 "By its terms, the [FAA] leaves no place for the exercise of discretion by a district court, but instead mandates that district courts shall direct the parties to proceed to arbitration on issues as to which an arbitration agreement has been signed.” Dean Witter Reynolds, Inc. v. Byrd, 470 U.S. 213, 218, 105 S.Ct. 1238, 84 L.Ed.2d 158 (1985). Furthermore, "any doubts concerning the scope of arbitrable issues should be resolved in favor of arbitration, whether the problem at hand is the construction of the contract language itself or an allegation of waiver, delay, or a like defense to arbitra-bility.” Moses H. Cone Mem. Hosp. v. Mercury Const. Corp., 460 U.S. 1, 24-25, 103 S.Ct. 927, 74 L.Ed.2d 765 (1983). If the matter at issue can be construed as within the scope of the arbitration agreement, it should be so construed unless the matter is expressly exempted from arbitration by the contract terms. United Steelworkers of Am. v. Mead Corp., 21 F.3d 128, 131 (6th Cir.1994). Eckel v. Equitable Life Assur. Soc. of the U.S., 1 F.Supp.2d 687, 688 (E.D.Mich.1998). 16. Simon does not argue to the contrary, but merely cites two out-dated cases in which courts did not require arbitration of ERISA claims: Amaro v. Continental Can Co., 724 F.2d 747 (9th Cir.1984), for the proposition that arbitrators lack the necessary competence to deal with ERISA statutory violations, and McLendon v. Continental Group, Inc., 602 F.Supp. 1492 (D.N.J.1985), for the proposi *775 tion that ERISA claims deal with the enforcement of substantive rights and thus should not be subject to the same arbitration provisions as govern contractual rights between parties. However, Amaro was discredited by Fabian Financial Services v. Kurt H. Volk, Inc. Profit Sharing Plan, 768 F.Supp. 728, wherein the court stated: Fabian also cites, as did Graphic Communications, Johnson v. St. Frances Xavier Cabrini Hosp., 910 F.2d 594 (9th Cir.1990). Johnson, too, relied on Amaro and, in particular, Amaro's expressed distrust of arbitrators' competence to decide ERISA claims. This rationale for rejection of an arbitration provision appears to contradict express Supreme Court holdings to the contrary. It is true, however, that the Amaro court did not have the benefit of the recent decisions discussed above. For reasons not obvious, the Ninth Circuit decisions have not addressed the several Supreme Court cases relied upon by the Plan and which this Court finds persuasive and binding. Thus, in asserting that an arbitrator cannot interpret ERISA, Fabian finds itself in conflict with, for example, McMahon, where the Supreme Court stated " 'we are well past the time when judicial suspicion of the desirability of arbitration and of the competence of arbitral tribunals' should inhibit enforcement of the Act 'in controversies based on statutes.' ” Id. at 731-32 (citations omitted).
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CRITICIZED_OR_QUESTIONED
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724 F.2d 747
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223 F.3d 814
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ACAN, DR
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Santiago Amaro v. The Continental Can Company
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HANSEN, Circuit Judge. Twenty-three nurses (“the nurses”) filed an action against the appellees (collectively “Union Pacific”), alleging violations of *816 ERISA 1 and Title VII of the Civil Rights Act of 1964. The district court 2 dismissed both the ERISA and Title VII claims for failure to exhaust administrative remedies. All but one of the nurses appeal. We affirm. I. Facts The nurses who are appellants in this action all entered into individual employment contracts at various times between 1971 and 1997 with the railroad appellees to provide nursing consultive services. Each contract specifically designated the signatory nurse as an independent contractor rather than an employee of the railroads. In the mid-1990’s, the Railroad Retirement Board (RRB) examined the propriety of Union Pacific’s classification of nine nurses as independent contractors. After reviewing the nurses’ contracts, as well as Internal Revenue Service (IRS) documents, the RRB, using definitions contained in the Railroad Retirement Act and the Railroad Unemployment Insurance Act, concluded that the nine nurse consultants who provided services for Union Pacific in the early 1990’s actually were employees of the railroads rather than independent contractors. Following the RRB’s determination, these twenty-three nurses brought this action in federal district court seeking damages for violations of ERISA and Title VII. 3 Both sides filed motions for summary judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. The district court granted Union Pacific’s motion for summary judgment with regard to the ERISA and Title VII claims after finding that the nurses failed to exhaust then-administrative remedies. All but one of the nurses appeal the district court’s summary judgment determinations to this court, II. Discussion We review a district court’s summary judgment determinations de novo, applying the same standards as the district court. See Treanor v. MCI Telecomms. Corp., 200 F.3d 570, 573 (8th Cir.2000). A. ERISA Claims The nurses contend that by improperly classifying them as independent contractors rather than employees, Union Pacific wrongfully denied them participation in employee benefit plans offered to other employees. Pursuant to § 502(a)(1)(B) of ERISA, the nurses seek to enforce and clarify their rights under the employee benefit plans. They also seek to recover benefits that they allege they would have received if they had been allowed to participate in the plans. The nurses additionally allege violations of § 510 of ERISA, which provides that “[i]t shall be unlawful for any person to discharge, fine, suspend, expel, discipline, or discriminate against a participant or beneficiary... for the purpose of interfering with the attainment of any right to which such participant may become entitled...” under the employee benefits plan at issue. 29 U.S.C. § 1140. Without addressing the merits of the nurses’ ERISA claims, the district court held that the claims must be dismissed because the nurses failed to exhaust their administrative remedies. The *817 district court noted that although ERISA itself contains no exhaustion requirement, beneficiaries must exhaust their administrative remedies if such exhaustion is mandated by the ERISA plan at issue. The district court is correct. It is well-established that when exhaustion is clearly required under the terms of an ERISA benefits plan, the plan beneficiary’s failure to exhaust her administrative remedies bars her from asserting any unexhausted claims in federal court. See Layes v. Mead Corp., 132 F.3d 1246, 1252 (8th Cir.1998). Exhaustion is clearly required under the plans at issue in this case, and the nurses did not pursue their administrative remedies before seeking relief from the federal court. Hence, the nurses’ claims are barred. 4 The nurses argue that exhaustion requirements are not applicable to plaintiffs pursuing remedies for violations of § 510 of ERISA. The nurses contend that claims brought pursuant to § 510 implicate questions of statutory analysis and do not require courts to interpret the ERISA benefit plan in order to determine whether a statutory violation has occurred. We note that a split exists among the circuits as to whether exhaustion is required when a plaintiff alleges a violation of § 510. Some courts hold that exhaustion in a § 510-type context is not required. See Smith v. Sydnor, 184 F.3d 356, 364 (4th Cir.1999), cert. denied, - U.S. -, 120 S.Ct. 934, 145 L.Ed.2d 813 (2000); Richards v. General Motors Corp., 991 F.2d 1227, 1235 (6th Cir.1993); Held v. Manufacturers Hanover Leasing Corp., 912 F.2d 1197, 1205 (10th Cir.1990); Berger v. Edgewater Steel Co., 911 F.2d 911, 916 n. 4 (3d Cir.1990), cert. denied, 499 U.S. 920, 111 S.Ct. 1310, 113 L.Ed.2d 244 (1991); Amaro v. Continental Can Co., 724 F.2d 747, 750-52 (9th Cir.1984). Other courts extend the exhaustion requirement to § 510-type claims. See Counts v. American Gen. Life and Accident Ins. Co., 111 F.3d 105, 109 (11th Cir.1997); Lindemann v. Mobil Oil Corp., 79 F.3d 647, 650 (7th Cir.1996) (holding that although exhaustion principles apply to § 510-type claims, the decision to require exhaustion in the § 510-type context lies within the discretion of the district court). The question of whether exhaustion is required when a plaintiff is alleging a § 510 violation has not been addressed by this court. We need not, however, resolve the question in the context of this case. Although the nurses allege that they “are challenging the legality of [Union Pacific’s] plan provisions which attempt to define out the Nurses in violation of ERISA and the IRS code,” (Appellants’ Br. at 26), in this case, the district court cannot consider such a challenge without interpreting Union Pacific’s benefit plans. Hence, the challenge presented is not simply a question of statutory analysis. Rather, the question of whether Union Pacific’s plans operate in a manner that impermissi-bly excludes the nurses from participation necessarily requires the district court to interpret the operation and application of the employee benefits plans. In particular, the question of whether these nurses, who were always paid on an hourly basis, are “salaried employees” is critical to a determination of whether they ever were eligible to be “participants” in the plans. In cases where resolution of the § 510 issue turns on an interpretation of the ERISA benefits plan at issue, a district court does not abuse its discretion in requiring plaintiffs to exhaust their administrative remedies. Cf. Lindemann, 79 F.3d at 650 (“Thus the law of [the Seventh] Circuit remains that the decision to require exhaustion as a prerequisite to bringing a federal lawsuit is a matter within the discretion of the trial court and its *818 decision will be reversed only if it is obviously in error”) (citations omitted); Zipf v. American Tel. & Tel. Co., 799 F.2d 889, 894 n. 6 (3d Cir.1986) (“We acknowledge that cases may arise in which a Section 510 claim is so closely intertwined with a serious issue requiring interpretation of a benefit plan that a trial court could properly stay the statutory action pending resolution of the issue by the plan fiduciaries”); Stumpf v. Cincinnati, Inc., 863 F.Supp. 592, 598 (S.D.Ohio 1994) (holding that in cases where the § 510 claim is so intertwined with an issue necessitating interpretation of a benefit plan, a district court has discretion to stay the § 510 action pending an administrative resolution of the issue), aff'd, 70 F.3d 116 (6th Cir.1995) (unpublished table decision). We do not reach the question of whether exhaustion of administrative remedies is required in every case where the plaintiff is asserting a § 510 violation. We simply hold that in the facts and circumstances of this case, the district court committed no error in dismissing the nurses’ § 510 claims without prejudice and requiring them to exhaust their administrative remedies before seeking court relief. B. Title VII Claims The nurses allege that Union Pacific violated 'Title VII of the Civil Rights Act of 1964 by discriminating against them on the basis of gender. The district court dismissed their claims after finding that Nurse Gail Huss, the only nurse to file an administrative claim before the Equal Employment Opportunity Commission, failed to file her claim within 180 days of the alleged discriminatory acts as required by law. See 42 U.S.C. § 2000e-5(e). Nurse Huss argues that she remained unaware of Union Pacific’s gender discrimination until the RRB issued its decision in 1996. The district court disagreed. The district court noted that during “her deposition, Huss testified that the only sex discrimination that she experienced was defendants’ act of classifying her as an independent contractor rather than an employee, thereby denying her benefits. It is undisputed that Huss ceased being an independent contractor and became an employee with full benefits in August of 1990. It follows that August of 1990 is the last possible date on which actionable sex discrimination could have occurred.” (Appellants’ Add. at 17.) We are persuaded by the district court’s thorough and well-reasoned opinion. We conclude, therefore, that the district court properly dismissed the nurses’ Title VII claims. III. Conclusion For the foregoing reasons, we affirm the' judgment of the district court. 1. The Employee Retirement Income Security Act of 1974 (codified as amended at 29 U.S.C. §§ 1001-1461 (1994 & Supp. Ill 1997) and in scattered sections of Title 26 U.S.C.). 2. The Honorable Catherine D. Perry, United States District Judge for the Eastern District of Missouri. 3.The nurses also alleged other statutory and state common law violations, which the district court dismissed for failure to state a claim upon which relief can be granted. See Fed.R.Civ.P. 12(b)(6). The nurses are not appealing the district court's Rule 12(b)(6) determinations. 4. ERISA plan beneficiaries are not required to exhaust their claims if they can demonstrate that exhaustion "would be wholly futile.” Glover v. St. Louis-San Francisco Ry., 393 U.S. 324, 330, 89 S.Ct. 548, 21 L.Ed.2d 519 (1969). The nurses, however, have failed to show futility in this case.
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CONFLICT_NOTED
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724 F.2d 747
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209 F.3d 1309
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ACAN, DR
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Santiago Amaro v. The Continental Can Company
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PUBLISH IN THE UNITED STATES COURT OF APPEALS FOR THE ELEVENTH CIRCUIT FILED U.S. COURT OF APPEALS ________________________ ELEVENTH CIRCUIT APR 20 2000 THOMAS K. KAHN No. 98-5189 CLERK ________________________ D. C. Docket No. 88-06602-CV-NCR ANGELO PERRINO, STEPHEN PLACIDO, EDNA SHEPARD, ARTHUR WILSON, Plaintiffs-Appellants, versus SOUTHERN BELL TELEPHONE & TELEGRAPH CO., Defendant-Appellee, ________________________ Appeal from the United States District Court for the Southern District of Florida _________________________ (April 20, 2000) Before BIRCH and MARCUS, Circuit Judges, and MILLS*, Senior District Judge. MARCUS, Circuit Judge. This appeal concerns whether plaintiffs who bring a federal suit based on claims arising under the Employee Retirement Income Security Act of 1974 (“ERISA”) are required to exhaust available administrative remedies when their employer fails to comply with all of ERISA’s procedural requirements for establishing a reasonable claims procedure, 29 U.S.C. § 1133; 29 C.F.R. § 2560.503-1. In this case, the district court granted summary judgment to BellSouth Telecommunications, Inc. on the ERISA claims of four plaintiffs, Angelo Perrino, Stephen Placido, Edna Shepard, and Arthur Wilson, who failed to exhaust a grievance and arbitration procedure contained in the company’s collective bargaining agreement. The plaintiffs had sought a termination pay allowance based on a provision of the agreement--a provision which constituted, as BellSouth concedes, an ERISA welfare benefits plan. We conclude that because the grievance and arbitration procedure afforded the plaintiffs access to an administrative scheme from which they could have received an adequate legal remedy for their ERISA claims, plaintiffs were required to exhaust this scheme * Honorable Richard Mills, Senior U.S. District Court Judge for the Central District of Illinois, sitting by designation. 2 prior to filing suit in federal court. Accordingly, we affirm the judgment of the district court. I. The facts of this case are straightforward. Angelo Perrino, Stephen Placido, Edna Shepard, and Arthur Wilson (“Appellants”) are four former employees of BellSouth Communications Inc. (“Appellee”) who became disabled during the course of their employment with BellSouth in the 1980's.1 At the time, BellSouth maintained a Sickness and Accident Disability Benefit Plan (the “STD” plan) which provided short-term disability benefits to employees for up to one year. After a year, BellSouth would remove a disabled employee from the company payroll and the ex-employee then would become eligible for long-term, disability- related pension benefits. In this case, all of the named Appellants received both short-term and long-term, disability-related pension benefits from BellSouth.2 At the time of Appellants’ employment, BellSouth did not maintain a formal ERISA plan. Instead, the terms and conditions of Appellants’ employment were 1 During the period of Appellants’ employment, BellSouth was known as Southern Bell Telephone and Telegraph. 2 At the time of summary judgment, Angelo Perrino and Edna Shepard still were receiving these long-term benefits. Stephen Placido and Arthur Wilson received these same benefits until the time of their deaths. 3 governed solely by the collective bargaining agreement (“Agreement”) between Bell South and their union, Communication Workers of America (“Union”). Article 8.07A2 of the Agreement contains a termination pay provision, the subject of this litigation. The provision allows certain classes of employees, for example, laid-off workers, to receive a termination pay allowance separate and apart from the short-term and long-term disability benefits received by Appellants. The provision reads in part: 8.07 Employment Termination Allowance A. Basis of Payment. A termination allowance shall be paid to a regular or temporary employee whose service is terminated under any of the conditions outlined below; moreover, service pension eligibility will not be a factor in determining whether an employee is eligible for a termination allowance, except as described in 8.06A2.... 2. As an inducement proposed, or agreed to, by the Company to an employee to resign because of inability or unadaptability to perform properly the duties of the job as distinguished from misconduct. For purposes of this litigation, BellSouth concedes that these termination pay provisions constitute an employee welfare benefit plan under ERISA.3 3 BellSouth also admitted before the district court that there were no formal ERISA plan documents aside from the Agreement, for the relevant time period, and that, during this period, the company did not strictly comply with ERISA provisions codified at 29 U.S.C. § 1133 or at 29 C.F.R. § 2560.503-1. Bell South subsequently promulgated a summary plan description on August 9, 1992, which outlined all of the statutorily-required, ERISA-plan features including an ERISA claims 4 The Agreement also specifies a grievance and arbitration procedure for resolving any disputes as to “the true intent and meaning” of the Agreement or disputes “adversely affect[ing] the rights of any employee” such as a dispute over the eligibility of disabled ex-employees to receive termination pay allowances.4 procedure. 4 Article 21.01 of the Agreement describes the grievance procedure in great detail. It reads: 21.01 Grievance Levels. The parties agree that in the handling and adjustment of grievances by the Union the following procedures shall be followed. A. An employee or group of employees shall have the right to present and adjust with the management any grievances as provided in Section 9(a) of the National Labor Relations Act, as amended, provided, however, that no adjustment shall be made with the employee or group of employees involved which is inconsistent with the terms of any collective bargaining agreement between the parties then in effect, and provided further that the Union has been given an opportunity to be present at such an adjustment. B. After an employee or employees have presented a grievance to the Union for settlement and a Union representative has informed the Company that the Union represents the employee, or employees, the Company will not discuss or adjust such grievance, with said employee, or employees, unless the aggrieved employee, or employees, initiate a request that the Company discuss and adjust such grievance directly with him, or them, but in no event shall an adjustment be made unless a Union representative is afforded an opportunity to be present at such an adjustment. C. All grievances, other than discipline related grievances and those involving the true intent and meaning of this agreement between the parties or adversely affecting the rights of other employees, shall be handled under the procedure set forth below.... (emphasis added). Article 21.01 then proceeds to describe the available four-level grievance 5 Previously, BellSouth has been involved in several grievance proceedings with ex- employees who sought termination allowance pay, including two cases which proceeded to arbitration. According to the terms of the Agreement, a person has sixty days, from the last occurrence on which the grievance is based, to present a grievance for review. On August 5, 1988, Appellants filed a class action suit against BellSouth under § 301 of the Labor-Management Relations Act (“LMRA”), 29 U.S.C. § 185, and § 502 of the Employment Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1132. Appellants alleged that they were entitled to termination pay pursuant to the collective bargaining agreement in effect during the tenure of their employment with BellSouth and sought injunctive, declaratory, and compensatory relief. Appellants also sought a judgment that the termination pay provisions of the Agreement constituted an employee welfare benefit plan under ERISA and that they were entitled to benefits thereunder. Appellants asserted, based largely on a BellSouth memorandum from Assistant BellSouth VP Joe Walling, that disabled procedure in intricate detail. Grievances which cannot be resolved through the provisions outlined in Article 21.01 may be arbitrated by an independent arbitrator at the request of either the Union or BellSouth. This arbitration procedure is outlined in detail in Article 23 of the Agreement. 6 workers, at the time of Appellants’ disability-related terminations, were eligible for the termination pay allowances in addition to disability-related pension benefits.5 On April 14, 1989, Appellants amended their complaint to assert an additional theory of recovery, claiming that BellSouth had changed its interpretation of the termination pay provisions after Appellants had filed this suit for termination allowance benefits. Specifically, Appellants contended that BellSouth secretly tried to rescind Walling’s interpretive memorandum after they had filed suit, an act which constituted a breach of BellSouth’s fiduciary obligations under ERISA. Appellants then sought a permanent injunction requiring BellSouth to administer the plan in accordance with its prior interpretation of the termination pay provisions. 5 Appellants argue that the December 16, 1986 memo from Walling explains that disabled workers may receive both the termination allowance and pension benefits. The memo states in part: This [Article 8.07A] language was clearly intended to mean that we would pay an employee termination allowance if eligible under Article 8.07A, whether or not that employee might receive a pension in addition to the termination allowance. One example of when this might occur would be in the case of an employee who is unable to return to work after exhausting 52 weeks of benefits. Such an employee if still disabled after 52 weeks would be dropped from the payroll and if pension eligible, would receive a pension in addition to termination allowance under Article 8.07A4. 7 On June 30, 1992, BellSouth filed a motion for summary judgment. It argued that the Agreement never has allowed disabled workers to receive termination pay allowances. Moreover, BellSouth contended that Appellants’ claims were barred in federal court by their failure to exhaust available administrative remedies prior to filing suit. Specifically, BellSouth argued that Appellants had not filed grievances pursuant to the Agreement under which they were seeking termination pay. On July 9, 1998, the district court entered summary judgment in favor of BellSouth on this basis. Prior to filing suit, only one of the Appellants, Angelo Perrino, actually requested a termination pay allowance from BellSouth. Perrino’s request was made on January 29, 1988, four years after he was terminated by BellSouth, and was denied on March 7, 1988. In its letter denying Perrino the termination pay allowance, BellSouth informed Perrino that the Agreement did not authorize termination allowance payments to ex-employees with long-term disabilities, but that if he had made a timely request for a termination pay allowance, Perrino would have been able to invoke the Agreement’s grievance and arbitration procedure to challenge the denial of the pay allowance. Before the district court, Appellants claimed that because the Agreement did not adhere to all of the procedural requirements of ERISA, they need not have 8 resorted to the Agreement’s administrative process for handling employment- related grievances. Appellants also argued that the grievance and arbitration procedure specified in the Agreement only applied to disputes or controversies between the Union and the Company, and that arbitration only can occur upon written request of either the Union or BellSouth. In response, BellSouth observed that the plain language of Article 21.01 of the Agreement grants an “employee” or “group of employees” the right to file “any” grievance, including grievances over the denial of termination pay allowances, with or without Union involvement, and that BellSouth has been involved in several such grievance and arbitration procedures with ex-employees over denials of termination pay allowances. In granting BellSouth summary judgment on Appellants’ claims, the district court concluded that Appellants had failed to exhaust available administrative remedies in the form of the Agreement’s grievance and arbitration procedure. The district court made several pertinent factual findings in connection to its ruling. First, the district court determined that despite its technical noncompliance with ERISA regulations, “the Agreement sets forth with sufficient clarity the provisions for termination pay and the grievance procedures to be followed,” and that despite this clarity, Appellants failed to file grievances for termination pay allowances. Second, the district court found that Appellants’ failure to exhaust this 9 administrative scheme was not due to a lack of knowledge about the scheme or a lack of access to the scheme. The district court observed: [T]here has been no evidence that the plaintiffs did not have access to the agreement or that the defendant failed to provide a copy upon request from the plaintiffs. When plaintiff Perrino made his request for termination pay, he cited the provisions of the Collective Bargaining Agreement. Consequently, he was well aware of the grievance procedures in the Bargaining Agreement. Finally, the district court determined based on record evidence that the Agreement’s grievance and arbitration procedure previously had been employed by similarly-situated ex-employees to challenge the denial of termination pay allowances. The district court explained that “former employees of defendant have availed themselves of the grievance procedure in similar circumstances as those presented by plaintiffs,” making the grievance and arbitration procedure an available administrative remedy for Appellants’ claims. II. We review the district court’s grant of summary judgment de novo, viewing the evidence in the light most favorable to the party opposing the motion. See Counts v. Amer. Gen. Life & Accident Ins. Co., 111 F.3d 105, 108 (11th Cir. 1997) (citing Harris v. Board of Educ. of Atlanta, 105 F.3d 591, 595 (11th 10 Cir.1997)). In this case, however, it is undisputed that Appellants failed to exhaust the administrative remedy outlined in their ERISA plan. Appellants concede that they did not pursue a grievance over the denial of termination pay benefits through the grievance and arbitration procedure explained in BellSouth’s collective bargaining agreement. Both parties also concede that this Agreement constituted an ERISA plan for the relevant time period. Our law is well-settled that “plaintiffs in ERISA actions must exhaust available administrative remedies before suing in federal court.” Counts, 111 F.3d at 108; see also Springer v. Wal-Mart Associates’ Group Health Plan, 908 F.2d 897, 899 (11th Cir.1990); Mason v. Continental Group, Inc., 763 F.2d 1219, 1225-27 (11th Cir.1985). However, a district court has the sound discretion “to excuse the exhaustion requirement when resort to administrative remedies would be futile or the remedy inadequate,” Counts, 111 F.3d at 108, or where a claimant is denied “meaningful access” to the administrative review scheme in place, Curry v. Contract Fabricators, Inc. Profit Sharing Plan, 891 F.2d 842, 846-47 (11th Cir.1990). In this case, the district court did not excuse the exhaustion requirement, and granted summary judgment on this basis. On appeal, Appellants challenge this decision for two principal reasons: first, they claim that exhaustion should not be required where an ERISA plan fails to comply in full with all ERISA regulations, 11 and second, they argue that the grievance and arbitration procedure contained in the ERISA plan was not available to ex-employees, making resort to this procedure futile. The decision of a district court to apply or not apply the exhaustion of administrative remedies requirement for ERISA claims is a highly discretionary decision which we review only for a clear abuse of discretion. See Springer, 908 F.2d at 899; Curry, 891 F.2d at 846. After carefully reviewing the record, we conclude that the district court did not abuse its discretion in applying the exhaustion requirement to Appellants’ claims. First, our caselaw makes plain that as a general rule plaintiffs in ERISA actions must exhaust available administrative remedies before suing in federal court. See Counts, 111 F.3d at 108; Springer, 908 F.2d at 899; Mason, 763 F.2d at 1225-27. This rule is grounded in several important policy rationales, and also is consistent with Congressional intent. As we explained in Mason: Compelling considerations exist for plaintiffs to exhaust administrative remedies prior to instituting a lawsuit. Administrative claim-resolution procedures reduce the number of frivolous lawsuits under ERISA, minimize the cost of dispute resolution, enhance the plan's trustees’ ability to carry out their fiduciary duties expertly and efficiently by preventing premature judicial intervention in the decisionmaking process, and allow prior fully considered actions by 12 pension plan trustees to assist courts if the dispute is eventually litigated. In addition, imposing an exhaustion requirement in the ERISA context appears to be consistent with the intent of Congress that pension plans provide intrafund review procedures. Id. at 1227 (internal citation omitted). As a result, we strictly enforce an exhaustion requirement on plaintiffs bringing ERISA claims6 in federal court with certain caveats reserved for exceptional circumstances. See Springer, 908 F.2d at 899. Thus far, our circuit has recognized exceptions only when “resort to administrative remedies would be futile or the remedy inadequate,” Counts, 111 F.3d at 108, or where a claimant is denied “meaningful access” to the administrative review scheme in place, Curry, 891 F.2d at 846-47. Appellants do not dispute this precedent. However, Appellants argue that we should recognize a new exception to our exhaustion requirement; namely, that 6 We apply this exhaustion requirement to both ERISA claims arising from the substantive provisions of the statute, and ERISA claims arising from an employment and/or pension plan agreement. See Counts, 111 F.3d at 109; Springer, 908 F.2d at 899; Mason, 763 F.2d at 1225-27; see also Lindemann v. Mobil Oil Corp., 79 F.3d 647, 650 (7th Cir.1996) (finding that rationale for exhaustion applies equally to claims for benefits and claims based upon ERISA itself). However, several other circuits do not apply the exhaustion requirement to causes of action based on statutory violations. See Held v. Manufacturers Hanover Leasing Corp., 912 F.2d 1197, 1205 (10th Cir.1990); Zipf v. American Tel. & Tel. Co., 799 F.2d 889, 891-94 (3rd Cir.1986); Amaro v. Continental Can Co., 724 F.2d 747, 750-53 (9th Cir.1984). This circuit split, however, is irrelevant to this dispute since Appellants’ claims are based on the termination allowance provision of a collective bargaining agreement and not on a substantive violation of ERISA. 13 an employer’s noncompliance with ERISA’s technical requirements (for example, creating a summary plan description, or delineating a formal claims procedure) should excuse a plaintiff’s duty to exhaust administrative remedies. Under ERISA, an employer is required to furnish employees with a “Summary Plan Description” that gives details of the benefits provided by the company, and articulates the claims procedure available to present and adjudicate ERISA claims. See 29 U.S.C. § 1021-22; 29 C.F.R. § 2560.503-1. Federal regulations also mandate certain requirements for an ERISA claims procedure in order to ensure the procedure is “reasonable.” According to federal regulations, “a plan established and maintained pursuant to a collective bargaining agreement,” in order to comply with ERISA’s requirements for a reasonable claims procedure, must “set[] forth or incorporate[] by specific reference”: (A) Provisions concerning the filing of benefit claims and the initial disposition of benefit claims, and (B) A grievance and arbitration procedure to which denied claims are subject. 29 C.F.R. § 2560.503-1(b)(2)(A)-(B). Before the district court, BellSouth conceded that the Agreement, at the time of Appellants’ employment and termination, did not comply strictly with all of ERISA’s regulations. For instance, the termination benefits provision never was 14 formalized by a separate summary plan description. In addition, although the Agreement contained a detailed provision explaining the terms and conditions under which employees could receive termination allowances as well as a detailed grievance and arbitration procedure available for “any” employment-related grievance, these provisions did not state explicitly that employees could file termination allowance claims or obtain independent review of these claims if they were denied by the plan administrator. Because of these technical deficiencies, Appellants contend that the ERISA exhaustion requirement ought to be waived. They claim that because the Agreement’s provisions do not explicitly aver that termination allowance claims can be filed or receive review and arbitration, the Agreement does not contain a “reasonable” claims procedure. Appellants also assert that because BellSouth did not promulgate and distribute a summary plan description, they should not be compelled to exhaust the plan’s administrative remedy procedures.7 7 In support, Appellants cite proposed federal regulations which state: A failure to provide the procedures mandated by the [ERISA] regulations effectively denies participants and beneficiaries access to the process mandated by the [ERISA] Act. It is the view of the Department that claimants should not be required to continue to pursue claims through an administrative process that fails to meet the minimum standards of the regulation. Rules and Regulations for Admin. and Enforcement, Claims Procedure, 63 Fed. Reg. 48390, 48397 15 We find Appellants’ arguments unpersuasive. After reviewing the relevant federal regulations and our prior precedent, we decline to create an exception to the exhaustion requirement in this case. First, we stress the exceedingly technical nature of Appellants’ contention. While the Agreement is in technical noncompliance with some ERISA regulations, the Agreement does contain specific provisions which explain employee eligibility for termination allowances (the ERISA benefit at issue) as well as the process for adjudicating termination-related grievances. Moreover, the district court determined that other similarly-situated ex-employees had used the Agreement’s grievance and arbitration procedure to challenge the denial of termination pay allowances, and that several of these ex- employees had obtained independent arbitration of their claims. In addition, the district court found that the only Appellant who even requested a termination allowance, Angelo Perrino, had specific knowledge of the Agreement’s grievance and arbitration procedure yet never filed a grievance. The district court also concluded that there was no evidence that any of the Appellants lacked access to or knowledge about the Agreement’s grievance and arbitration procedure.8 (1998) (to be codified at 29 C.F.R. pt. 2560) (proposed Sep. 9, 1998). 8 It is important to note that BellSouth did not maintain an ERISA benefits plan separate from the collective bargaining agreement, and is not seeking to impose a “twin” exhaustion requirement on plaintiffs requiring them to proceed through both an ERISA claims procedure and a separate grievance and arbitration procedure contained in the collective bargaining agreement. Here, the 16 Therefore, we conclude that, while technically deficient, the Agreement’s administrative scheme was available to Appellants for the review and arbitration of their ERISA termination allowance claims, and that if the process had been invoked, Appellants could have received independent arbitration and an adequate legal remedy for their claims. Our prior precedent makes clear that the exhaustion requirement for ERISA claims should not be excused for technical violations of ERISA regulations that do not deny plaintiffs meaningful access to an administrative remedy procedure through which they may receive an adequate remedy. For instance, in Counts, the plaintiff argued that the district court erred in not excusing the exhaustion requirement because his employer’s termination letter failed to comply precisely with ERISA’s notice requirements under §29 U.S.C. 1133 and §29 C.F.R. 2560.503-1(f). See Counts, 111 F.3d at 107. The district court acknowledged that the termination letter was technically deficient in some respects, but concluded that “the letter substantially complied with the notice requirements because, taken as a whole, it supplied Counts ‘with a statement of reasons that, under the circumstances of the case, [the employer’s letter] permitted a sufficiently clear termination pay provisions of the collective bargaining agreement serve as the ERISA plan. In short, plaintiffs wish to seek and receive ERISA benefits based on the termination provisions of the collective bargaining agreement while ignoring the grievance and arbitration procedure clearly explained in this same agreement for exhaustion purposes. 17 understanding of the administrator’s position to permit effective review.’” See id. at 108. On appeal, we affirmed the district court’s application of the exhaustion requirement despite the employer’s noncompliance with the ERISA notice provision. In so doing, we explained that while the “normal time limits for administrative appeal may not be enforced” against a claimant who receives an inadequate benefits termination letter, the “usual remedy” should not be “excusal from the exhaustion requirement, but remand to the plan administrator for an out-of- time administrative appeal.” Id. The clear import of our decision was the conclusion, that though employees should not have their ERISA claims adversely affected by an employer’s technical noncompliance with ERISA regulations, so too, they should not be able to avoid the exhaustion requirement where technical deficiencies in an ERISA claims procedure do not hinder effective administrative review of their claims. See Baxter v. C.A. Muer Corp., 941 F.2d 451, 453-54 (6th Cir. 1991) (upholding exhaustion requirement despite the employer’s failure to issue a written denial of an employee’s benefits where the error resulted in no 18 prejudice to the employee’s ability to obtain administrative review of the claim denial).9 This approach conforms with the logic of our exhaustion doctrine in which we apply the exhaustion requirement strictly and recognize narrow exceptions only based on exceptional circumstances. See Counts, 111 F.3d at 108; Springer, 908 F.2d at 899; Curry, 891 F.2d at 846-47. Our exceptions to this doctrine where resort to an administrative scheme is unavailable or would be “futile,” or where the remedy would be “inadequate” simply recognize that there are situations where an ERISA claim cannot be redressed effectively through an administrative scheme. In these circumstances, requiring a plaintiff to exhaust an administrative scheme would be an empty exercise in legal formalism. That said, it makes little sense to excuse plaintiffs from the exhaustion requirement where an employer is technically noncompliant with ERISA’s procedural requirements but, as the district court determined in this case, the plaintiffs still had a fair and reasonable opportunity to 9 Analogously, several federal circuits have denied remedial relief for technical violations of ERISA’s statutory requirements absent a showing that the violations had adversely affected the plaintiffs’ ERISA rights. See Berger v. Edgewater Steel Co., 911 F.2d 911, 920-21 (3rd Cir.1990); Blau v. Del Monte Corp., 748 F.2d 1348, 1350-51 (9th Cir.1984). In addition, we have held that procedural errors in the management of an ERISA plan did not warrant a more liberal review standard than the traditional “arbitrary and capricious” standard for the judicial review of ERISA benefit determinations. See Anderson v. Ciba-Giegy Corp., 759 F.2d 1518, 1520 (11th Cir. 1985); see also Blau v. Del Monte Corp., 748 F.2d 1348, 1352-53 (9th Cir.1984); Dennard v. Richards Group, Inc., 681 F.2d 306, 313-14 (5th Cir.1982). 19 pursue a claim through an administrative scheme prior to filing suit in federal court. Cf. Curry, 891 F.2d at 846-47 (finding that “[w]hen a plan administrator in control of the available review procedures denies a claimant meaningful access to those procedures, the district court has the discretion not to require exhaustion”). Therefore, if a reasonable administrative scheme is available to a plaintiff and offers the potential for an adequate legal remedy, then a plaintiff must first exhaust the administrative scheme before filing a federal suit. Finally, Appellants also argue that resort to the Agreement’s grievance and arbitration procedure would have been futile because they are ex-employees not owed a duty of fair representation by the Union. They contend that under the arbitration provision of the Agreement, arbitration is available only after either the Union or BellSouth requests it in connection to an employment-related grievance, and that the Union is not obligated legally to pursue arbitration for them.10 10 The arbitration provision states in relevant part: 23.01(B) If at any time a controversy should arise between the Union and the Company regarding the true intent and meaning of any provisions of this or any other agreement between the parties or a controversy as to the performance of an obligation hereunder, which the parties are unable to compose by full and complete use of the grievance procedure set up by Article 21, the matter shall be arbitrated upon written request of either party to this Agreement to the other. The provision goes on to explain that an “impartial arbitrator” will be chosen upon agreement of the parties, and that if no agreement is reached, either side may apply to the Federal Mediation and 20 Appellants therefore claim that they lack access to arbitration of their ERISA claims under the Agreement’s administrative scheme. Based on the undisputed facts of this case, we find this argument to be without merit. This case might be different if Appellants actually had resorted to the grievance and arbitration procedure only to be told by the Union that it would not seek arbitration for their benefits claims. However, none of the Appellants even pursued the grievance and arbitration procedure available, at least, in theory. In addition, the district court specifically found, based on the uncontroverted affidavit of Ray Giesler, BellSouth’s Operations Manager of Labor Relations, and the record of several prior arbitrations, that the Union filed a substantial number of grievances on the behalf of terminated employees, and that BellSouth retirees enjoyed the same rights as active employees with respect to filing a termination- related grievance. The district court also noted that at least two retirees previously had arbitrated with BellSouth over the termination pay allowance. We therefore conclude that the futility objections raised by Appellants in terms of access to the arbitration proceeding are merely theoretical, if present at all, and therefore do not justify Appellants’ excusal from the exhaustion requirement. III. Conciliation Service for an appointed arbitrator. 21 In short, we find that Appellants were not denied access to an administrative scheme from which they could have received an adequate legal remedy for their ERISA claims. As such, we conclude that Appellants were compelled to first exhaust the available administrative remedies contained in the collective bargaining agreement prior to filing suit in federal court. We therefore AFFIRM in full the district court’s order granting summary judgment to BellSouth on Appellants’ ERISA claims. AFFIRMED. 22
|
CONFLICT_NOTED
|
724 F.2d 747
|
111 F.3d 105
|
NF
|
Santiago Amaro v. The Continental Can Company
|
111 F.3d 105 97 FCDR 2684, 10 Fla. L. Weekly Fed. C 854 J.W. COUNTS, Plaintiff-Counter-Defendant, Appellant,v.AMERICAN GENERAL LIFE AND ACCIDENT INSURANCE COMPANY;American General Corporation Plan Administrator,Defendants-Counter-Claimants-Appellees,Gulf Life Insurance Company, et al., Defendants. No. 96-8795. United States Court of Appeals, Eleventh Circuit. April 29, 1997. Susan Warren Cox, Gerald M. Edenfield, Edenfield & Cox, P.C., Statesboro, GA, for Plaintiff-Counter Defendant-Appellant. Wade W. Herring, II, Hunter, Maclean, Exley & Dunn, Savannah, GA, for Defendants-Counter Claimants-Appellees. Appeal from the United States District Court for the Southern District of Georgia. Before DUBINA and BLACK, Circuit Judges, and COHILL*, Senior District Judge. DUBINA, Circuit Judge: 1 Appellant J.W. Counts ("Counts") appeals the district court's grant of summary judgment in this ERISA1 action in favor of Appellees American General Life and Accident Insurance Company and American General Corporation Plan Administrator (collectively, "AGLA"). The district court ruled that Counts failed to exhaust his administrative remedies. For the reasons that follow, we affirm. I. BACKGROUND 2 Counts worked as an insurance agent and sales manager for AGLA and its predecessors from 1965 to 1990. Counts was a participant in the Gulf Life Field Representative's Long-Term Disability Plan ("the Plan"),2 an employee benefit plan governed by ERISA and administered by AGLA. A participant must be totally disabled to receive long term disability ("LTD") benefits under the Plan. The Plan defines total disability as a sickness or injury which prevents a participant from performing the main duties of his or her regular occupation. After 12 months, however, the definition changes: the participant must be unable to perform "each and every of the main duties of any occupation. Any occupation is one that the Participant's training, education, or experience will reasonably allow." R3-61, District Court Order at 3 (emphasis added). 3 Counts injured his back in 1986. Four years later, he became totally disabled and stopped working. In November 1990, AGLA began paying Counts LTD benefits under the Plan. Counts received LTD benefits for 12 months. AGLA then suspended his benefits pending receipt of an opinion from his physician, Dr. Cannon, as to whether Counts was totally disabled under the "any occupation" definition. In March 1992, Dr. Cannon sent AGLA a letter stating that he felt Counts was capable of light clerical work and was not totally disabled. Two other doctors who evaluated Counts reached similar conclusions. 4 By letter dated April 30, 1992, AGLA's Disability Committee terminated both Counts' LTD benefits and his employment with AGLA. The termination letter stated that the committee had determined that Counts no longer met the requirements for total disability under the Plan. The letter also provided as follows: 5 The Disability Committee decision is final unless overturned by an appeal; therefore, your employment and benefit status will remain terminated during the appeal process. 6 If you disagree with this determination, you may appeal the decision by sending your written request within 60 days following your receipt of this notice stating the reason for your appeal along with any additional information for review to [address omitted]. 7 If you wish to examine any pertinent documents, we will need a written authorization from your physician before medical information can be released to you. 8 District Court Order at 4-5. 9 Counts did not appeal the decision. Four months after the 60-day appeals period expired, Counts' attorney wrote AGLA a letter discussing Counts' medical situation and stating, "We would appreciate hearing from you regarding this matter at your earliest convenience." Id. at 5. Counts' attorney did not request any specific information from AGLA. AGLA wrote back reiterating its basis for discontinuing Counts' benefits and offering further assistance upon request. Ten months later, Counts' attorney wrote AGLA a second letter stating that AGLA's letter terminating Counts' LTD benefits failed to comply with the notice requirements set forth in 29 U.S.C. § 1133 and 29 C.F.R. § 2560.503-1(f). AGLA responded that it felt its denial letter was in substantial compliance with the regulatory requirements, but that it welcomed further inquiries. Counts made none. Five months later, Counts filed this action. 10 Counts' complaint alleged (1) that AGLA wrongfully discontinued his LTD benefits under the Plan and (2) that AGLA terminated his employment for the purpose of interfering with his rights under other AGLA employee benefit plans in which Counts was a participant. Counts sought an order reinstating his LTD benefits and requiring AGLA to continue contributing to his other employee benefit plans. Counts also sought attorney's fees and an award of civil penalties for AGLA's alleged failure to supply him with requested information. AGLA counterclaimed for overpayment of LTD benefits. The district court granted AGLA's motion for summary judgment on the ground that Counts failed to exhaust his administrative remedies. Counts appealed.3 II. DISCUSSION 11 We review the district court's grant of summary judgment de novo, applying the same standards as the district court. Harris v. Board of Educ. of the City of Atlanta, 105 F.3d 591, 595 (11th Cir.1997). "Summary judgment is appropriate if the pleadings, depositions, and affidavits show that there is no genuine issue of material fact and that the movant is entitled to judgment as a matter of law." Harris v. H & W Contracting Co., 102 F.3d 516, 518 (11th Cir.1996). In reviewing a grant of summary judgment, we view the evidence in the light most favorable to the party opposing the motion. Id. at 519. 12 It is undisputed that Counts failed to exhaust his administrative remedies. The Plan required Counts to appeal the denial of his LTD benefits within 60 days of receiving his termination letter. Counts never appealed. The law is clear in this circuit that plaintiffs in ERISA actions must exhaust available administrative remedies before suing in federal court. Springer v. Wal-Mart Associates' Group Health Plan, 908 F.2d 897, 899 (11th Cir.1990); Mason v. Continental Group, Inc., 763 F.2d 1219, 1225-27 (11th Cir.1985). However, district courts have discretion to excuse the exhaustion requirement when resort to administrative remedies would be futile or the remedy inadequate. Curry v. Contract Fabricators, Inc. Profit Sharing Plan, 891 F.2d 842, 846 (11th Cir.1990). The district court found neither circumstance present here. Accordingly, the district court declined to excuse the exhaustion requirement in this case. Counts argues that the district court erred for several reasons. 13 First, Counts argues that the district court should have excused his failure to exhaust administrative remedies because AGLA's termination letter failed to comply with ERISA's notice requirements. See 29 U.S.C. § 1133; 29 C.F.R. § 2560.503-1(f). The district court agreed that AGLA's letter was technically deficient. Nevertheless, the district court concluded that the letter substantially complied with the notice requirements because, taken as a whole, it supplied Counts "with a statement of reasons that, under the circumstances of the case, permitted a sufficiently clear understanding of the administrator's position to permit effective review." District Court Order at 12, quoting Donato v. Metropolitan Life Ins. Co., 19 F.3d 375, 382 (7th Cir.1994). 14 Even if the district court erred in finding substantial compliance, Counts would not be excused from the exhaustion requirement. The consequence of an inadequate benefits termination letter is that the normal time limits for administrative appeal may not be enforced against the claimant. Epright v. Environmental Resources Management, Inc. Health & Welfare Plan, 81 F.3d 335, 342 (3rd Cir.1996); White v. Jacobs Eng'g Group, 896 F.2d 344, 350 (9th Cir.1989). Thus, the usual remedy is not excusal from the exhaustion requirement, but remand to the plan administrator for an out-of-time administrative appeal. Weaver v. Phoenix Home Life Mut. Ins. Co., 990 F.2d 154, 159 (4th Cir.1993); Brown v. Babcock & Wilcox Co., 589 F.Supp. 64, 71-72 (S.D.Ga.1984). Counts consistently took the position in the district court that remand was unwarranted and the only suitable course of action was excusal of the exhaustion requirement. Counts now argues that remand may be appropriate. However, "[a]n appellate court generally will not consider an issue raised for the first time on appeal... [, especially] where the appellant pursued a contrary position before the district court." United States v. One Lear Jet Aircraft, 808 F.2d 765, 773-74 (11th Cir.), vacated on other grounds, 831 F.2d 221 (11th Cir.1987). We hold that Counts waived any entitlement he may have had to the remedy for deficient notice. Accordingly, we need not address whether AGLA's termination letter substantially complied with regulatory notice requirements. 15 Counts also argues that the district court should have excused the exhaustion requirement because AGLA blocked his efforts to exhaust by failing to answer his requests for information about its benefits decision. In Curry v. Contract Fabricators Inc. Profit Sharing Plan, 891 F.2d 842, 846-47 (11th Cir.1990), we held that "[w]hen a plan administrator in control of the available review procedures denies a claimant meaningful access to those procedures, the district court has discretion not to require exhaustion." In Curry, the plan administrator failed to send Curry a written denial of his benefits claim. When Curry requested copies of plan documents to pursue his claim administratively, the administrator failed to provide them. The situation in this case was quite different. AGLA sent Counts a written termination letter which informed him of its decision and of his right to appeal within 60 days. Counts took no action during the 60 days. Months later, Counts' attorney sent AGLA two letters, neither of which requested Plan documents or other specific information from AGLA. AGLA responded to both letters and offered to supply additional information upon request. AGLA did not deny Counts meaningful access to the administrative review process. Curry simply does not apply here. 16 Finally, Counts argues that the exhaustion requirement should not apply to his claims alleging that AGLA violated ERISA by firing him to avoid contributing to his other employee benefit plans and by withholding information about its decision. We have consistently stated that the exhaustion requirement applies both to actions to enforce a statutory right under ERISA and to actions brought to recover benefits under a plan. Springer v. Wal-Mart Associates' Group Health Plan, 908 F.2d 897, 899 (11th Cir.1990); Mason v. Continental Group, Inc., 763 F.2d 1219, 1225-27 (11th Cir.1985). Counts asks us to depart from this precedent and hold, along with several of our sister circuits, that exhaustion is not required for claims of statutory violation. See Held v. Manufacturers Hanover Leasing Corp., 912 F.2d 1197, 1205 (10th Cir.1990); Zipf v. American Tel. & Tel. Co., 799 F.2d 889, 891-94 (3rd Cir.1986); Amaro v. Continental Can Co., 724 F.2d 747, 750-53 (9th Cir.1984); but see Lindemann v. Mobil Oil Corp., 79 F.3d 647, 650 (7th Cir.1996) (rationale for exhaustion applies equally to claims for benefits and claims based upon ERISA itself). However, even if we agreed with Counts' position, this panel lacks the authority to overrule prior panel decisions of this court. Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir.1981) (en banc). Under controlling precedent, Counts was required to exhaust administrative remedies for all of his ERISA claims. III. CONCLUSION 17 Counts failed to exhaust his administrative remedies before filing this ERISA action. The district court did not abuse its discretion in refusing to excuse that failure. Accordingly, we affirm the district court's grant of summary judgment in favor of AGLA. 18 AFFIRMED. * Honorable Maurice B. Cohill, Jr., Senior U.S. District Judge for the Western District of Pennsylvania, sitting by designation 1 Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq 2 AGLA assumed control of all Gulf Life operations in 1990 3 Counts' first appeal was dismissed for lack of jurisdiction. The district court then certified that its summary judgment order was final, and Counts renewed his appeal. AGLA's counterclaim is still pending in the district court
|
LIMITED_OR_DISTINGUISHED
|
724 F.2d 747
|
50 F.3d 1478
|
D
|
Santiago Amaro v. The Continental Can Company
|
SHADUR, Senior District Judge. Mario Diaz (“Mario”) and his wife Maria (collectively “Diazes”) sue United Agricultural Employee Welfare Benefit Plan and Trust (the “Plan”) and Associated Citrus Packers (“Associated”) for medical benefits assertedly owed to Diazes under the Plan, an employee welfare benefit plan subject to the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. §§ 1001-1461, and to the Consolidated Omnibus Budget Reconciliation Act (“COBRA”), 29 U.S.C. §§ 1161-1169.1 Associated and the Plan sought and obtained summary judgment under Fed.R.Civ.Proc. (“Rule”) 56 on grounds stemming from Diazes’ failure to exhaust the Plan’s internal administrative remedies. We affirm. Background Mario was employed by Associated as an agricultural worker during the late 1980’s and early 1990’s. On June 1, 1990 Associated switched health care providers and began offering coverage to its employees and their families through the Plan. Employees were given the option of electing single coverage for themselves alone or family coverage for themselves and eligible dependents. Associated paid the cost of employee coverage, while employees were responsible for the cost of dependent coverage via deductions from their pay checks. Like many Associated employees, Mario neither speaks nor reads English. After Mario received a 45-page Summary Plan Description dated June 1, 1990 that explained the Plan’s terms in both English and Spanish, Mario read portions of the Summary Plan Description in Spanish. In part the document included the Spanish counterpart of this description of claim procedures: Processing Procedures for Medical or Dental Claims *1481Any claim for Benefits under the Plan must be made in writing to the Benefit Trust Claims Department. If a claim for medical or dental benefits is denied in whole or in part, the Claim Department will notify you of the action being taken on the claim. If a denial is necessary, such denial shall: (a) be in writing, in a manner intended to be understood by the average person, (b) contain the specific reason for denial of the claim; and (c) include an explanation of the claims review procedure. Appeal Procedures for Medical, Dental or Vision Claims 1. If a claim for benefits is denied in whole or in part, you, or a representative you choose, may request a review of the decision within 60 days of the date you receive the notice of denial or limitation. A request for review must be in writing, addressed to the Benefits Administrator, c/o United Agricultural Employee Welfare Benefit Plan & Trust Claims, 54 Corporate Park, Irvine, CA 92714. You should state the reason you are requesting review, and include any additional information which might help the Administrator in evaluating your claim. 2. After the claim has been reviewed, if the denial is upheld, the Benefits Administrator will: (a) notify you in writing, (b) include a copy of the specific Plan provisions affecting the denial; and (c) let you know how to file an appeal. 3. If you disagree with the conclusions reached by the Benefits Administrator, you may file a written appeal within sixty (60) days of receipt of the results of that review. A written appeal should include: (a) your name, address and Social Security number, (b) the name of the patient, (c) the claim number and date of denial notice, (d) the specific facts upon which your appeal is being made; and (e) all documents you have supporting those facts. Any appeal should be addressed to the Benefit Committee, c/o United Agricultural Employee Welfare Benefit Plan & Trust, 54 Corporate Park, Irvine, CA 92714. Benefit Committee consideration will be based on your written statement, unless you request a formal hearing. If you request a hearing, it will be conducted at the offices of the Trust, upon 10 days written notice to all parties. Although not necessary, you may be represented by an attorney of your choice at the hearing. The Benefit Committee will then conduct a full and fair evaluation of the appeal and shall base its decision on the information available at the time of consideration. 4.The Benefit Committee shall mail a written decision on the appeal to you within 30 days after receipt of the appeal. If there are special circumstances, such as a request to hold a hearing, the 30 day period will be extended to a maximum of 120 days. The Committee’s final decision shall: (a) be written in a manner intended to be understood by the average person; (b) include the specific reason or reasons for the decision; and (c) contain a specific reference to the pertinent Plan provisions upon which the decision is based. This direction (in Spanish) was on the final page of the Summary Plan Description: For assistance in filing a claim or for information, call or write: UNITED AGRICULTURAL EMPLOYEE WELFARE BENEFIT PLAN & TRUST CLAIMS ADMINISTRATIVE OFFICE 54 Corporate Park Irvine, California 92714 (714) 975-1424 (800) 223-4590 Although immediately before the switchover to the Plan Mario had not opted for family coverage, he asserts (and we credit for purposes of dealing with the Rule 56 ruling) that he elected such coverage under the Plan. Mario told Gregorio Perez (part of Associates’ father and son managerial team) of that choice and relied on Gregorio to implement it. After enrollment in the Plan was complete, Associated mailed its first monthly Group *1482Contribution Report (“Report”) to the Plan along with a check for the month of June 1990. Mario was listed for single coverage, and his wife and children were never added to the June 1 enrollment card. Insurance premiums for family coverage, however, appear to have been deducted from Mario’s paychecks by Associated in June and July. Due to the seasonal nature of his work, Mario was laid off on July 6, 1990. Under the terms of the Plan his coverage expired on July 31, the last day of the month. Associated notified the Plan of Mario’s termination by drawing a line through his name as it appeared on the August 10 Report. What happened next is in dispute. According to the Plan, in satisfaction of its COBRA obligations under Section 1166 it sent Mario a letter on August 30, 1990 notifying him in Spanish of his right to continue coverage at his own expense. ■ As proof the Plan offers a document generated by its computer during this litigation that indicates an August 30 “Letter Creation Date.” In addition, the Plan supplies an example of the type of letter that it says was mailed on that date. Mario testified during his deposition that he did not receive notification until October or November 1990, well past COBRA’s 60-day election period under Section 1165. If true, that would violate Section 1166(c), which requires notification within 14 days of the Plan’s receipt of Associated’s August 10 Report. In any event the actual notification letter (if there ever was one) has disappeared. Mario was rehired on August 28, 1990. There is no dispute that this time he elected family coverage. According to the terms of the Plan, however, Diazes were not eligible for coverage until Mario had worked at least 60 hours in a single month. That occurred in September 1990, causing coverage to kick in on October 1. Mario and his family were thus without coverage during the months of August and September 1990. In September 1990 Diazes’ daughter Julia was diagnosed with and began treatment for leukemia, leading to her death on May 2, 1991. But the Plan denied Mario’s claim for Julia’s medical expenses on the basis of the Plan’s pre-existing condition limitation.2 Although the text of each of the Plan’s several denial letters sent during the spring and summer of 1991 was entirely in English, the back of each letter contained the following notice in both English and Spanish: APPEAL RIGHTS If you believe your claim has not been paid correctly, you may send a written appeal within 60 days of the date of this notice. Any written appeal should include member’s name and social security number, the claim number, the reason for your appeal and any other information you feel might help us in reviewing your claim. Appeal should be mailed to the address below: Benefits Administrator Tayson Insurance Administrators 54 Corporate Park Irvine, CA 92714 Mario understood (indeed, he gleaned from the back of the letters) that his claim for Julia’s expenses was being denied. Instead of following the directions for an appeal, however, he went to see Barbara Hartley (“Hartley”), Associated’s on-site insurance representative. Hartley told Mario, “They’re not going to pay.” Mario asked, “What am I going to do?” — a question to which Hartley had no answer. Mario never took any appeal in the manner explained in the Summary Plan Description and the Plan’s denial-of-benefit letters. Instead on January 24, 1992 Diazes filed suit under Section 1132. On June 11, 1993 the *1483District Court granted both defendants’ motions for summary judgment because the Diazes had failed to exhaust the Plan’s internal administrative remedies. This appeal followed. Exhaustion Doctrine Quite early in ERISA’s history, we announced as the general rule governing ERISA claims that a claimant must avail himself or herself of a plan’s own internal review procedures before bringing suit in federal court. Amato v. Bernard, 618 F.2d 559, 566-68 (9th Cir.1980).3 Although not explicitly set out in the statute, the exhaustion doctrine is consistent with ERISA’s background, structure and legislative history and serves several important policy considerations, including the reduction of frivolous litigation, the promotion of consistent treatment of claims, the provision of a nonadver-sarial method of claims settlement, the minimization of costs of claim settlement and a proper reliance on administrative expertise. Id. at 566-68. “Consequently the federal courts have the authority to enforce the exhaustion requirement in suits under ERISA, and [] as a matter of sound policy they should usually do so.” Id. at 568. By not submitting a written appeal to the Benefits Administrator, Mario failed to comply with the Plan’s internal review procedures and hence did not exhaust the available administrative remedies. Diazes urge (1) that exhaustion principles simply do not apply because Diazes advance a claim of statutory violation rather than one of Plan violation and (2) that even if exhaustion requirements do apply, Diazes’ claim falls within each of two recognized exceptions to those requirements: inadequacy and futility. We consider those arguments seriatim. Because the potential applicability vel non of exhaustion principles is a question of law, we consider it de novo. But if that question gets an affirmative answer, the District Court’s decision not to grant an exception to the application of those principles is reviewed for abuse of discretion. Amato, 618 F.2d at 569. ERISA Violation v. Plan Violation Diazes argue that because their action is premised on the Plan’s failure to comply with the statutory requirements of Section 1166, Diazes were excused from seeking administrative review. To that end they point to Amaro v. Continental Can Co., 724 F.2d 747, 750-53 (9th Cir.1984) and Zipf v. American Telephone & Telegraph, 799 F.2d 889, 891-94 (3rd Cir.1986) as purportedly standing for the proposition that ERISA’s usual exhaustion requirements do not apply where a claimant’s action is based on a statutory violation. But that characterization seriously overstates the holdings in those cases. Both Amato and Zipf dealt with claimed violations of Section 1140, which prohibits interference with or discrimination against an employee’s exercise or attainment of plan benefits. Neither ease involved an individual’s claim for plan benefits under a particularized set of facts—the kind of scenario that is presented here and that has led this and other Circuits to establish the claimant’s need to go the administrative route first rather than turning directly to the courts. Indeed, Amaro, 724 F.2d at 751 (footnote omitted) highlighted that very distinction, reconfirming the viability of Amato and its applicability to resolve cases such as the one before us: In Amato we enforced the exhaustion requirement in an action for a “declaration of the parties’ rights and duties” under a pension plan. Amato, 618 F.2d at 561. Like Challenger [v. Local Union No. 1, 619 F.2d 645 (7th Cir.1980)], the pension plan in Amato contained the internal appeal procedure required by section 503. Our decision was based on the required section 503 administrative remedies and on the assistance the courts receive by “pension plan trustees interpreting their plans.” [618 F.2d] at 568 (emphasis added). *1484Both Challenger and Amato, the cases relied on by Kross [v. Western Elec. Co., 701 F.2d 1238 (7th Cir.1983)], dealt with the rights of a party under a pension plan that falls within ERISA coverage. Both cases contained internal appeal procedures, eon-gressionally mandated by section 503, that were designed to hear the claims presented in those cases. We are faced solely with an alleged violation of a protection afforded by ERISA. There is no internal appeal procedure either mandated or recommended by ERISA to hear these claims. Furthermore, there is only a statute to interpret. That is a task for the judiciary, not an arbitrator. And Zipf, 799 F.2d at 891-92 pointed to precisely the same contrast after having reconfirmed the Third Circuit’s own exhaustion doctrine (Wolf v. National Shopmen, 728 F.2d 182, 185 (3d Cir.1984)) that parallels our Amato requirement. To be sure, many employee claims for plan benefits may implicate statutory requirements imposed by ERISA or COBRA (or perhaps other statutes, for that matter). And when the administrative resolution of those claims is then presented for judicial review, courts may then be called upon to determine whether the plan administrators have construed or dealt with those statutes in an appropriate manner. But that prospect does not give a claimant the license to attach a “statutory violation” sticker to his or her claim and then to use that label as an asserted justification for a total failure to pursue the congressionally mandated internal appeal procedures. Exceptions to the Exhaustion Requirement 1. Inadequacy of Remedy Diazes next contend that because the body of the denial letters was written in English, the Plan failed to alert them to the reason for the denials (the pre-existing condition limitation) in a language that they could comprehend. Their not knowing why their claims were being denied allegedly undercut their ability to lodge an appeal, so that the internal review procedures were assertedly rendered “inadequate.” Inadequacy of remedy is an exception to the exhaustion requirement. Amato, 618 F.2d at 568. When Diazes’ claims were denied they had in their possession the Spanish language version of the Summary Plan Description. As already indicated, that document outlined the appeals procedure and provided an address and two telephone numbers “[f]or assistance in filing a claim or for information.” If the denial letters left Diazes in the dark (something that we will accept on this appeal), a toll-free telephone call could have shed light on the matter. Diazes fail to explain why that phone call was not made, nor have they suggested that the call would have been unproductive. Moreover, Diazes were informed in Spanish that their claims were being denied, that they had 60 days to file an appeal and that an appeal consisted of a written review followed (if necessary) by a hearing and subsequent evaluation by a committee. In sum, surely the District Court did not abuse its discretion in finding the Plan’s internal appeal procedures adequate. Diazes seek to avoid the consequence of that finding by arguing that ERISA’s statutory and regulatory disclosure requirements obligated the Plan to notify them in Spanish of the reason for the denial. Diazes claim that because they could neither speak nor read English, the denial letters failed to furnish specific reasons for the denial “written in a manner calculated to be understood by the claimant,” in asserted violation of Section 1133(1) and 29 C.F.R. § 2560.503-l(f).4 And we recognize that if there were indeed a statutorily insufficient disclosure of a denial of plan benefits, even a carefully crafted internal appeals procedure (carefully crafted in purely procedural terms, that is) would be rendered inadequate. But that aspect of Diazes’ contention also fails to survive analysis. ERISA itself contains no express foreign language requirement, and ERISA’s regulations contain only *1485two limited foreign language mandates, the most relevant of which is found in Reg. § 2520.102-2(c) relating to summary plan descriptions. Importantly, the selfsame statutory language on which Diazes seek to rely— “written in a manner calculated to be understood by the participant” — is echoed both in the ERISA provision dealing with summary plan descriptions (Section 1022(a)(1)) and in the ERISA provision dealing with letters of denial (Section 1133(1)).5 What we have then are two essentially identical statutory requirements, both of which have been interpreted and elaborated on in regulations issued by the Secretary of Labor (“Secretary”) — who is charged with the responsibility of administering the ERISA statute and promulgating regulations. And in only one of those instances has Secretary attached any requirement that under certain circumstances a document transmitted to plan participants must be in a foreign language. Both in that instance (Reg. § 2520.102-2(c), relating to summary plan descriptions) and in the only other regulation that imposes any foreign language requirement, that requirement is expressly limited to providing plan participants with offers of assistance6 — in no instance has Secretary, after having given full consideration to the problems of workforces that are not English-language-literate, imposed any requirement that the operative document itself — either any summary plan description (Reg. § 2520.102-2(a) and (b)) or any summary annual report (Reg. § 2520.104b-10(d)) or any denial of benefits such as those involved in this case (Reg. § 2560.503-l(f)) — must be furnished to employees in their native tongues.7 If we were to accept Diazes’ invitation to read Section 1133(1) as requiring the letters of denial at issue here to be written in Spanish, there would be no legitimate reason to construe the identical statutory language in Section 1022(a)(1) any differently. And again Secretary, after full deliberation, has not imposed any such requirement with respect to summary plan descriptions or claim denials. For us to read such a requirement into the statutes by judicial fiat where Secretary has not done so would do violence to the legitimate expectations of employers and plan administrators who have conformed their conduct to the existing regulations. 2. Futility of Exhaustion Finally, Diazes argue that it would have been “futile” for them to demand administrative review because both defendants have demonstrated by their continued refusal to pay that they have no intention of doing so. That argument is really circular, for defendants’ current denial is pegged entirely to Diazes’ failure to have pursued the administrative route. Moreover, such bare assertions of futility are insufficient to bring a claim within the futility exception, which is designed to avoid the need to pursue an administrative review that is demonstrably doomed to fail. Amato, 618 F.2d at 569; Communications Workers of America v. AT & T, 40 F.3d 426, 432-34 (D.C.Cir.1994); Springer v. WalMart Assoc. Group Health Plan, 908 F.2d 897, 901 (11th Cir.1990); *1486Drinkwater v. Metropolitan Life Ins. Co., 846 F.2d 821, 826 (1st Cir.1988). In this instance Diazes’ own delinquency in pursuing an internal appeal prevented the possibility of an administrative look at the merits, and the record contains nothing but speculation to suggest that the administrators would have reached a preconceived result in that respect.8 Conclusion No error was involved in the District Court’s application of the exhaustion doctrine to dismiss Diazes’ claim, nor did that court abuse its discretion by refusing to recognize an exception to the exhaustion doctrine. We AFFIRM.. All further citations to ERISA and COBRA provisions will take the form "Section —,” referring to the Title 29 numbering rather than to either statute’s internal numbering.. Included in the two-language Summary Plan Description that had been delivered to Mario was this definition, in both English and Spanish, of "pre-existing condition": The term "pre-existing condition” refers to any illness which began, or accidental injury which happened, before the patient's effective date of coverage under the Plan. For benefit purposes, the condition will be considered preexisting if the patient incurred expense for diagnosis, or treatment of the condition or symptoms of the condition before diagnosis is established, including related complications, at any time prior to his or her effective date. Treatment includes medications, as well as medical care and/or diagnostic testing.. Amato has become (and remains) an authority followed in other Circuits in announcing and adhering to the same requirement.. Further citations to regulations in 29 C.F.R. will simply take the form "Reg. § —.”. To be more precise, Section 1022(a)(1) speaks in terms of the summary plan descriptions having to be written in a manner calculated to be understood by the "average plan participant.” In the present context that language variation is not material — in each instance the clear statutory purpose is to create an objective standard, a type of plain-language requirement in contrast to the often overly technical lawyerese that tends to be employed in the underlying plan documents themselves.. Reg. § 2520.104b-l 0(e) imposes an identical foreign language offer-of-assistance requirement in connection with English-language summary annual reports provided to plan participants. That further buttresses the analysis in the text..As already stated, in this instance the Plan went the extra mile by providing the entire 45-page Summary Plan Description, and not just an offer of assistance, in Spanish as well as English. We see no reason to treat either the Plan or Associated less favorably for having done more than Secretary’s regulation requires.. Diazes' Reply Brief attaches a letter from the Plan’s Benefit Administrator rejecting an effort by Diazes' counsel to seek administrative review after the District Court had already granted summary judgment for the reasons dealt with here. That rejection, based as it was entirely on the outcome of the litigation between the parties, obviously gives no support to Diazes' futility argument.
|
LIMITED_OR_DISTINGUISHED
|
724 F.2d 747
|
45 F.3d 947
|
DR
|
Santiago Amaro v. The Continental Can Company
|
E. GRADY JOLLY, Circuit Judge: Brown & Root, Inc. fired Donald Chail-land. Chailland sued Brown & Root, Inc., alleging that it had fired him to prevent him from attaining increased benefits under its pension plan, in violation of § 510 of the Employee Retirement Income Security Act (ERISA). Brown & Root, Inc. moved to dismiss Chailland’s complaint for failure to exhaust administrative remedies provided by ERISA and Brown & Root’s Employees’ Retirement and Savings Plan. Alternatively, Brown & Root, Inc. moved to stay the proceedings pending arbitration under the provisions of the plan. The district court denied the motion. This appeal presents the question-whether Brown & Root, Inc. may raise these exhaustion requirements, including arbitration, in a suit claiming a violation of ERISA § 510. I Upon attaining fifteen years of service with Brown & Root, Inc., (“Brown & Root”) participants in its Employees’ Retirement and Savings Plan (the “ER & SP”) become entitled to substantially greater benefits. 1 On February 5, 1992, when he was about six months from that threshold, Brown & Root fired Donald Chailland. Brown & Root contended that Chailland had been insubordinate, but Chailland contended that he was fired to prevent his attaining an increase in benefits under the ER & SP. Without pursuing administrative remedies provided by *949 the ER & SP, Chailland sued Brown & Root, alleging illegal termination under ERISA § 510, 29 U.S.C. § 1140. 2 Chailland did not sue the ER & SP. In his complaint, he sought back pay, reinstatement — or, failing that, front pay — and restitution of the benefits to which he would have been entitled. 3 Brown & Root moved to dismiss Chail-land’s complaint for failure to exhaust his administrative remedies under ERISA and the ER & SP. It also moved for a stay pending arbitration, but it never requested an order compelling arbitration. 4 Chailland contended that the exhaustion requirement did not apply to his claim under § 510 and that neither the ER & SP’s administrative remedies nor its requirement for arbitration applied to his claim. The district court agreed with Chailland and denied Brown & Root’s motions. Brown & Root appealed the district court’s order denying arbitration, invoking our jurisdiction under 28 U.S.C. § 1292(a)(1) and the Federal Arbitration Act, 9 U.S.C. § 16(a)(1)(A). The district court then certified a discretionary appeal under 28 U.S.C. § 1292(b) from its order denying dismissal for failure to exhaust administrative remedies. Because of the appeal hinging on arbitration — an appeal of right — we consolidated the two appeals and carried with the case the petition to grant an appeal on the exhaustion issue under § 1292(b). We will grant Brown & Root’s petition, and consider the matters together. II A We consider this appeal against the backdrop of three critical points, which we establish at the outset. First, as Brown & Root admits, the ER & SP is a separate legal entity as a matter of law, and may sue or be sued in its own right. 29 U.S.C. § 1132(d). At oral argument, it became clear that in this lawsuit Brown & Root claims no legal relationship with the ER & SP. The ER & SP is not an agent of Brown & Root, and Brown & Root is not a third party beneficiary of any agreement between Chailland and the ER & SP. Brown & Root would not be obligated to abide by any determination made by the ER & SP if Chailland had submitted his claim to it. Second, the arbitration agreement urged in this case derives solely from the provisions of the ER & SP. At oral argument, counsel for Brown & Root conceded that the arbitration agreement applies only to disputes “regarding” the ER & SP, and the duty to arbitrate arises only after administrative remedies provided by the ER & SP have been exhausted. In other words, there is no agreement between Brown & Root and Chailland to arbitrate anything. 5 The only agreement to arbitrate is between Chailland and the ER & SP. Third, the ER & SP is not a party to this suit. Neither Chailland nor Brown & Root *950 joined it as a party, and the ER & SP did not attempt to intervene. Chailland does not contend that the ER & SP denied him any benefit or violated the law in any way. Instead, this dispute involves the ER & SP only tangentially, if at all; Chailland argues only that the terms of the ER & SP provide the motive for his termination. It is clear,, therefore, that this is an action against Brown & Root, Inc., alone. Bearing these preliminary points in mind, we turn to the question presented by this appeal. B Brown & Root argues that the district court erred when it denied its motion to dismiss Chailland’s complaint for failure to exhaust administrative remedies under ERISA caselaw and the ER & SP, which includes binding arbitration. It argues that under the terms of the ER & SP and the applicable case law, Chailland must pursue the ER & SP appeal procedures before filing this suit. Chailland argues that neither the administrative remedies of the ER & SP nor the exhaustion requirement imposed by our cases apply to a lawsuit for wrongful termination solely based on the wrongful conduct of Brown & Root. We agree. ERISA itself is silent on the question of exhaustion of administrative remedies under ERISA § 510. Indeed, ERISA contains no exhaustion requirement whatsoever. 6 However, relying upon Amato v. Bernard, 618 F.2d 559 (9th Cir.1980), plus Congressional intent and well-settled principles of administrative law, we adopted the common law rule that a plaintiff generally must exhaust administrative remedies afforded by an ERISA plan before suing to obtain benefits wrongfully denied. Denton v. First National Bank, 765 F.2d 1295, 1300-03 (5th Cir.1985). 7 Our cases applying this common law exhaustion requirement presuppose that the grievance upon which the lawsuit is based arises from some action of a plan covered by ERISA, and that the plan is capable of providing the relief sought by the plaintiff. 8 As our earlier discussion makes clear, neither of these conditions is present here. First, the decision to fire Chailland, which is the sole grievance presented in this case, was made by Brown & Root, not by the ER & SP. This lawsuit therefore does not involve any action of a plan covered by ERISA. In addition, the ER & SP is not capable of providing the remedy that Chailland seeks. Because neither of these conditions is present, we hold that our exhaustion doctrine is *951 simply inapplicable in this ease. Indeed, to remit Chailland’s claim to the ER & SP would make absolutely no sense and would be a hollow act of utter futility. Accordingly, we hold that the district court properly denied Brown & Root’s motion to dismiss pursuant to our exhaustion of remedies doctrine. 9 Ill For the above reasons, we hold that the district court properly denied Brown & Root’s motions to dismiss Chailland’s complaint or, in the alternative, to stay his suit pending arbitration. Accordingly, the judgment of the district court is affirmed and the case is remanded for further proceedings not inconsistent with this opinion. AFFIRMED and REMANDED. 1. According to the terms of the profit sharing plan, employees with ten to fourteen years of service are entitled to share in profits allocated to the plan in a proportion determined by multiplying their annual earnings by two, but upon reaching fifteen years of service, the multiplier rises to three. Thus, upon reaching fifteen years of service, an employee can expect a fifty percent increase in his benefits from the profit sharing plan. 2. Among other things, § 510 prohibits an employer from discharging an employee "for the purpose of interfering with the attainment of any right to which such participant may become entitled” under the provisions of an employee benefit plan. 3. Section 510 declares that the provisions of § 1132, ERISA § 502, "shall be applicable in the enforcement of this section.” Section 502 authorizes civil suits by a participant “to recover benefits due... under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan"; 29 U.S.C. § 1132(1); and "to obtain... appropriate equitable relief” to redress violations of ERISA or an ERISA plan, or to enforce any of its provisions. 29 U.S.C. § 1132(3). 4. According to the terms of the ER & SP, before suing in federal court, participants must "exhaust the Brown and Root Appeal and Arbitration Procedure to resolve any disputes." That procedure is available to a participant "if any benefit is denied in whole or in part, or if you believe the plan is violating the law in any way, or if any other dispute arises under the plan provisions.” The procedure is set forth in an amendment to the plan. Chailland denies that he was ever notified of the amendment, and therefore argues that he should not be bound by it. Because we determine that they are not applicable to his claims for other reasons, we need not consider this argument. 5.Because no agreement to arbitrate exists between Brown & Root and Chailland, we hold that the district court properly denied Brown & Root's motion to stay the lawsuit pending arbitration. 6. Because exhaustion is not required by ERISA, it is not a prerequisite to our jurisdiction. See Central States Southeast & Southwest Areas Pension Fund v. T.I.M.E.-D.C., 826 F.2d 320, 326-27 (5th Cir.1987). 7. The circuits are split on the general issue whether exhaustion of administrative remedies may be required for an ERISA § 510 claim. The Third, Ninth, and Tenth Circuits do not require exhaustion. See Zipf v. American Telephone & Telegraph Co., 799 F.2d 889, 891-94 (3rd Cir.1986); Amaro v. Continental Can Co., 724 F.2d 747, 750-52 (9th Cir.1984); Held v. Manufacturers Hanover Leasing Corp., 912 F.2d 1197, 1204-05 (10th Cir.1990). The Seventh Circuit, on the other hand, vests district courts with discretion to require exhaustion. Kross v. Western Electric Co., 701 F.2d 1238, 1243-45 (7th Cir.1983). The Eleventh Circuit apparently requires it. Mason v. Continental Group, Inc., 763 F.2d 1219, 1225-27 (11th Cir.1985), cert. denied, 474 U.S. 1087, 106 S.Ct. 863, 88 L.Ed.2d 902 (1986). In Mason, which is the sole instance in which a circuit court mandated exhaustion of remedies, the pension plan incorporated into its terms the collective bargaining agreement between the employer and the former employee's union, and thus provided an administrative mechanism for resolving the wrongful termination claims. Id. at 1226. In this case, however, the ER & SP cannot provide a remedy. In short, none of these cases furnishes a legal or logical justification for requiring exhaustion of remedies when, as here, the grievance is completely foreign to the plan and plan is incapable of providing a remedy. 8.See, e.g., Denton v. First National Bank, 765 F.2d 1295 (5th Cir.1985) (former employee sought lump-sum payment of benefits from pension plan); Meza v. General Battery Corp., 908 F.2d 1262 (5th Cir.1990) (former employee and union member sought payment of pension benefits from employer and pension plan, based on collective bargaining agreement and pension plan); Simmons v. Willcox, 911 F.2d 1077 (5th Cir.1990) (former employee sought payment of benefits and further alleged that the plan had breached its fiduciary duties to her by refusing to pay her claims for benefits); Medina v. Anthem Life Insurance Co., 983 F.2d 29 (5th Cir.1993) (insured sought payment of a disputed claim from group health insurer covered by ERISA). 9. Our previous cases have not characterized the exhaustion requirement as a personal defense that may be raised or waived only by a particular party, and it is unnecessary to so hold today. We observe, however, that in substance it is a defense to litigation, and that the prudential concerns underlying the exhaustion requirement suggest to us that if it is a defense, it belongs to the ER & SP, which is not a party to this case. It is a well-established general rule that parties may not raise defenses that are not their own. In United States v. Metropolitan St. Louis Sewer Dist., 952 F.2d 1040 (8th Cir.1992), for example, a federal case paralleled a concurrent state proceeding that culminated first in a consent decree. Intervenors sought to raise the consent decree approved by the state court to preclude, on the grounds of res judicata, entry of a consent decree by the federal court. The Eighth Circuit held that the intervenors could not assert the defense of res judicata. "This defense, if it is available at all, may only be raised by [the original defendant]. [The defendant's] decision not to assert this defense does not give the intervenors standing to raise it, as a party may assert a third party's rights only if, inter alia, the third party is unable to assert its own rights, a condition not present here." 952 F.2d at 1043.
|
CONFLICT_NOTED
|
724 F.2d 747
|
994 F.2d 1426
|
D, DR
|
Santiago Amaro v. The Continental Can Company
|
ALARCON, Circuit Judge: International Union of Operating Engineers-Employers Construction Industry Pension, Welfare and Training Trust Funds (“Trusts”) appeal from the order granting summary judgment in favor of Richard D. Karr, doing business as Alaska Unlimited Company (“AUC”). The Trusts seek reversal of the order dismissing their claims on two grounds. First, the Trusts contend that the doctrine of res judicata is inapplicable to this action, because a claim to recover accurate payments is separate and distinct from a claim to collect delinquent payments for the same time period. Second, the Trusts argue that it would be inequitable to bar an action by an employee benefit trust fund to recover accurate contributions from an employer. The Trusts argue that as a separate entity from both the union and the employer, they had no knowledge of the, inaccurate payments at the time they brought the earlier claims for delinquent contributions. We affirm because we conclude that the Trusts’ action is barred by the doctrine of res judica-ta. I. PERTINENT FACTS AND PROCEDURAL HISTORY The Trusts are unincorporated associations operating as employee benefit trust funds *1428under section 302 of the Labor Management Relations Act, 29 U.S.C. §§ 141-187 and the Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. §§ 1001-1461. The Trusts were created to provide retirement, medical, and training benefits to eligible employees. Richard D. Karr operates a construction company in Fairbanks, Alaska, and does business as AUC. From January 1, 1986, through December 31, 1988, AUC and Locals 302 and 612 of the International Union of Operating Engineers (“Union”) were parties to a collective bargaining agreement and several Trust Agreements established under ERISA. The Trust Agreements required AUC to file timely reports and to make monthly contributions to each of the Trusts for the benefit of eligible employees. The Trust Agreements granted the Trusts the right to recover liquidated damages, interest, and attorneys’ fees incurred in collecting any unpaid contributions from participating employers. They further permitted the Trusts to audit the payroll records of a participating employer “on demand.” Under the terms of the Trust Agreements, the employer was required to assume the costs of an audit if it revealed that he or she had failed to comply with the terms of the collective bargaining agreement. On May 29,1986, the Trusts filed an action against Karr under section 502(e)(1) and (f) of ERISA, 29 U.S.C. § 1132(e)(1) and (f), and section 301 of the Labor Management Relations Act, 29 U.S.C. § 185, to collect delinquent contributions for the periods May 1, 1985 through September 30, 1985, and November 1, 1985, through May 31, 1986. The Trusts also sought liquidated damages, interest and costs. While that action was pending, the Trusts filed a motion to compel an audit of AUC’s payroll records. On June 28, 1988, the district court entered an order granting the Trusts’ motion. The Trusts subsequently entered into a settlement agreement with AUC without conducting an audit. In the settlement agreement, AUC agreed to pay the Trusts $51,596.86 in exchange for the dismissal of the action with prejudice. The settlement agreement did not contain a reservation of the right to bring an action for any additional payments disclosed by an audit to be due as a result of the employer’s inaccurate payments for the same time period^ On August 9, 1988, the district court entered an order dismissing the action with prejudice. In October, 1987 and again in September, 1988, the Trusts requested Karr to submit to an audit of AUC’s payroll records. Karr refused to comply with the first request due to the ongoing litigation in the first action. Karr also refused to comply with the September, 1988 request because the Trusts failed to notify him of their intent to audit, as required in the Trust Agreements. On March 21, 1989, the Trusts filed a second action against Karr to collect delinquent contributions for July through October, 1988, and to recover liquidated damages, interest, attorneys’ fees, and costs. Notwithstanding Karr’s refusals to comply with the Trusts’ prior requests for an audit, the Trusts did not include a claim in this action to compel an audit of AUC’s payroll records. The parties settled the second action on June 28, 1989. Karr agreed to pay $15,000 to the Trusts in three monthly installments. The Trusts did not reserve the right in the settlement agreement to collect sums that might later be found to be due and owing under the Trust Agreements for the same time period. Karr subsequently made the three installment payments contemplated under the settlement agreement. On July 21, 1989, the district court entered an order dismissing the second action with prejudice. In 1990, the Trusts attempted to audit AUC for the period January, 1986, through December, 1988. Karr refused to provide the Trusts with complete payroll records with which to conduct the audit. On August 24, 1990, the Trusts filed the present claims to compel an audit of AUC for the period January 1,1986, through March 21, 1989, and to collect any funds found to be due and owing under the Trust Agreements. The district court granted summary judgment in favor of Karr. The court determined that the present claim for accurate contributions was barred because it arose out of the same transaction as the first two actions for delinquent payments. *1429II. RES JUDICATA The Trusts contend that the district court erred in holding their action barred by the doctrine of res judicata. The Trusts argue that the present action to compel an audit and to recover funds found by the audit to be owed under the Trust Agreement, is separate and distinct from the prior actions to collect delinquent contribution payments owed under the Trust Agreement for the same time periods. We review an order granting summary judgment de novo. Clark v. Bear Stearns & Co., 966 F.2d 1318, 1320 (9th Cir.1992). We review de novo the district court’s determination that an action is barred by the doctrine of res judicata. Id. The doctrine of res judicata bars “all grounds for recovery which could have been asserted, whether they were or not, in a prior suit between the same parties'... on the same cause of action, if the prior suit concluded in a final judgment on the merits.” Ross v. Int’l Bhd. of Elec. Workers, 634 F.2d 453, 457 (9th Cir.1980). The Trusts’ request to compel an audit of AUC’s payroll records for January 1, 1986 through April 12, 1988, was presented to the district court in the first action. As previously noted, the Trusts filed an action against AUC to recover delinquent payments on May. 29, 1986. While that action was pending, the Trusts filed a motion on April 12, 1988 to compel an audit of AUC. The district court granted the motion. After the parties entered into a settlement agreement, the district court dismissed the entire action with prejudice. The dismissal of the action with prejudice constitutes a final judgment on the merits, and prevents the Trusts from-reasserting the same claim in a subsequent action against AUC. See Lawrence v. Steinford Holding B.V. (In re Dominelli), 820 F.2d 313, 316-17 (9th Cir.1987) (dismissal of action with prejudice pursuant to a settlement agreement constitutes a final judgment on merits and precludes parties from reasserting the same claim in a subsequent action). Thus, we hold that the Trusts’ claim to recover accurate payments for the periods January 1, 1986 through April 12, 1988, the filing date of the Trusts’ motion to compel an audit, is barred by the doctrine of res judicata. The Trusts’ second action, filed on March 21, 1989, did not include a claim to compel an audit. We must decide whether the Trusts’ present claim to compel an audit for the period April 13, 1988, through March 21, 1989 could have and should have been brought in the Trusts’ second action to recover delinquent payments. In determining whether successive claims constitute the same cause of action, we consider (1) whether rights or interests established in the prior judgment would be destroyed or impaired by prosecution of the second action; (2) whether substantially the same evidence is presented in the two actions; (3) whether the two suits involve infringement of the same right; and (4) whether the two suits arise out of the same transactional, nucleus of facts. - Costantini v. Trans World Airlines, 681 F.2d 1199, 1201-02 (9th Cir.), cert. denied, 459 U.S. 1087, 103 S.Ct. 570, 74 L.Ed.2d 932 (1982). “The last of these criteria is the most important.”. Id. at 1202 (footnote omitted), “Whether two events are part of the same transaction or series depends on whether they are related to the same set of facts and whether they could conveniently be tried together.” Western Sys., Inc. v. Ullod, 958 F.2d 864, 871 (9th Cir.1992), cert. denied, — U.S. -, 113 S.Ct. 970, 122 L.Ed.2d 125 (1993). We are persuaded that the Trusts’ claim for accurate payments arises out of the-same transactional nucleus of facts as the prior actions for delinquent payments. The Trusts’ second action was premised on AUC’s alleged breach of the same Trust Agreements and- involved overlapping time periods with this present action. We have held that claims based on a breach of the same contract should be brought in the same action so long as the alleged breaches antedate the original -action. See McClain v. Apodaca, 793 F.2d 1031, 1034 (9th Cir.1986) (holding plaintiffs action for- breach of contract was barred under doctrine of res judi-cata because breach arose prior to filing of original' action for breach of contract). See also Restatement (Second) of Judgments *1430§ 25 cmt. b, illus. 2 (illustrating that all contractual breaches arising prior to filing of original action for breach of contract must be brought in same action to avoid bar of res judicata). We further conclude that the claim for accurate payments and the claim for delinquent payments form a convenient trial unit. The Trust Agreements permitted the Trusts to conduct an audit of AUC’s payroll records “on demand.” Thus, the Trusts had the opportunity to audit AUC’s payroll records and bring their claims for accurate and timely payments in the same cause of action. If, as the Trusts suggest, AUC refused to allow the Trusts to conduct their audit, the Trusts could have brought their claim to compel an audit and to recover underpaid contributions found by the audit in the same action as them prior claims for delinquent payments. Indeed, that is exactly the course of action pursued by the Trusts in the first action to recover delinquent payments. Citing Costantini, 681 F.2d at 1202, the Trusts argue that we must reverse because the present action for accurate payments involves infringement of a different right than the prior action to collect delinquent payments. We disagree. The Trust Agreements conferred upon the Trusts the right to receive proper monthly contributions from the employer. May v. Parker-Abbott Transfer and Storage, Inc., 899 F.2d 1007, 1010 (10th Cir.1990). This single right under the contract inherently assumes that the employer’s contributions will be “both accurately computed and timely paid.” Id. The Trusts further argue that res judicata should not bar this action because the evidence in this action is not substantially the same as that which would have been presented in the settled actions. See Costantini, 681 F.2d at 1202 (whether substantially the same evidence will be presented in both actions is a factor we may consider in determining the applicability of res judicata). Karr does not dispute the Trusts’ contention that the claim to recover inaccurate payments would involve different documentary evidence than a claim to recover delinquent payments for the same time period. The fact that some different evidence may be presented in this action to recover accurate payments, however, does not defeat the bar of res judicata. We have emphasized that the factors cited in Costanti-ni are “tools of analysis, not requirements.” Derish v. San Mateo-Burlingame Bd. of Realtors, 724 F.2d 1347, 1349 (9th Cir.1983). We have previously applied the doctrine of res judicata on the ground that the two claims aros'e out of the same transaction, without reaching other factors cited in Cos-tantini. See, e.g., C.D. Anderson & Co. v. Lemos, 832 F.2d 1097, 1100 (9th Cir.1987) (without reaching the other Costantini factors, we held second claim barred by res judicata solely on the ground that it arose out of the “same transactional nucleus of facts” as the original suit); Ulloa, 958 F.2d at 871 (holding that “[t]he test for whether a subsequent action is barred is whether it arises from the same transaction, or series of transactions as the original action”) (citation and internal quotation marks omitted); Sidney v. Zah, 718 F.2d 1453, 1459 (9th Cir.1983) (citing with approval transactional approach of Restatement (Second) of Judgments § 24 (1982), and noting that whether the claim “arise[s] out of the same transactional nucleus of facts fis] the criteria most stressed in our decisions”) (citation and internal quotation marks omitted). Because the Trusts’ claim to recover accurate payments from April 13, 1989 through March 21, 1989 arises out of the same transactional nucleus of facts as the Trusts’ second action for delinquent payments, we hold that this action is barred under the doctrine of res judicata. The policies underlying res judicata support our conclusion. The doctrine of res judicata “is motivated primarily by the interest in avoiding repetitive litigation, conserving judicial resources, and preventing the moral force of court judgments from being undermined.” Haphey v. Linn County, 924 F.2d 1512, 1518 (9th Cir.1991), rev’d in part on other grounds, 953 F.2d 549 (9th Cir.1992) (en bane). For this reason, res judicata bars not only all claims that were actually litigated, but also all claims that “could have been asserted” in the prior action. McClain, 793 F.2d at 1033. Because the audit claim in this matter could have been brought in the prior actions, the district court properly avoided *1431piecemeal litigation by invoking the doctrine of res judicata. In a case involving a strikingly similar ERISA dispute between a trust fund and an employer, the Tenth Circuit held that an action to compel an audit and to recover accurate contributions was barred by the doctrine of res judicata. May, 899 F.2d at 1010. In May, the trusts filed an action under ERISA to collect delinquent contributions, liquidated damages, interest, attorneys’ fees, and costs. After the parties negotiated a settlement, the district court dismissed the action with prejudice. Id. at 1008. Later, the trust fund informed the employer that it intended to audit its payroll records for periods preceding the filing date of the original action. Id. When the employer refused, the trust fund filed a second action to compel an audit and to recover monies owed due to the employer’s inaccurate payments. Id. The Tenth Circuit employed a transactional analysis in May. The court reasoned that “a contract is generally considered to be a transaction, so that all claims of contractual breach not brought in an original action would be subject to the bar of claim preclusion, so long as the breaches antedated the original action.” Id. at 1010 (citation and internal quotation marks omitted). The court explained its holding as follows: The essential purpose of the one “contract” underlying this litigation (the Trust Agreement) is to provide for proper payment of monthly contributions by Parker-Abbott to the Fund. For the performance of Parker-Abbott’s obligations to be complete, those contributions must be both accurately computed and timely paid. The contract provides remedies for late contributions and provides the Fund with audit powers to ensure that contributions are accurate. However, the existence of these tivo provisions within the contract does not justify two separate trips to the courtroom. Id. (emphasis added). The Trusts rely on I.A.M. Natl Pension Fund v. Indus. Gear Mfg. Co., 723 F.2d 944, 948 (D.C.Cir.1983) to support their argument that this action to recover unpaid contributions discovered during an audit is separate and distinct from the earlier actions to recover delinquent payments. In Industrial Gear, the D.C. Circuit was faced with the same' issue presented in May, i.e.; whether the settlement agreement in an action for delinquent contribution payments bars a later action between the same parties for underpaid contributions subsequently discovered during an audit of the employer’s records for the same time period. Id. The D.C. Circuit held that an action to receive accurate payments was separate and distinct from an action to recover delinquent payments, even though both actions covered the same time period and arose out of the same trust agreement. Id..at 948-49. In holding that the second action was not barred, the D.C. Circuit explained that the first action alleged the delinquency since April 1977 of Industrial Gear’s reports and payments. On the other hand, the instant suit alleges the inaccuracy of contributions for the audited period January 1977 to January 1981.... The fund in [the first action] did not raise the issue of the accuracy of reports and contributions submitted after January 1977. Indeed, not having audited the period after January 1977, the Fund had no knowledge of Industrial Gear’s inaccurate payments.... Because the Fund, when the consent decree was entered, had audited Industrial Gear’s payroll records only up to January 1977, it did not and could not have raised the issue of inaccurate payments beyond January 1977. We will not allow the consent decree to forever foreclose inquiry into the merits of this issue. Id. (first and second emphases added). The D.C. Circuit’s analysis in. Industrial Gear is contrary to the transactional approach to res judicata questions employed in this circuit. See, e.g., Ulloa, 958 F.2d at 871 (applying transactional approach to determine applicability of res judicata). The Trusts’ claims for accurate and timely payments arise from the same set of facts and can be conveniently tried together. We agree with the Tenth Circuit that an action to recover accurate contributions arises from *1432the same transactional nucleus of facts as a prior action to recover delinquent payments and is barred under the doctrine of res judi-cata. Relying on Amaro v. Continental Can Co., 724 F.2d 747, 749 (9th Cir.1984), the Trusts argue that the Ninth Circuit has carved out an exception to the transactional approach to res judicata questions in cases involving labor agreements or employee pension trust fund issues. In Amaro, employees filed a grievance with the union alleging that their employer had laid them off in violation of a collective bargaining agreement. The arbitrator denied the grievance on the ground that the employer’s conduct did not violate the collective bargaining agreement. Id. at 748. The employees subsequently filed a second action, alleging that the employer violated ERISA, 29 U.S.C. § 1140 by intentionally preventing them from qualifying for a pension. Id. We held that the ERISA claim was not barred by the arbitration ruling on the contractual claim, even though both actions arose from the same nucleus of facts. Id. at 749. Amaro is inapposite on two grounds. First, we based our holding in that case entirely on the fact that the statutory right of recovery under ERISA was completely “independent of any collectively bargained rights.” Id. See also International Ass’n of Machinists and Aerospace Workers v. Aloha Airlines, Inc., 790 F.2d 727, 731 (9th Cir.) (res judicata inapplicable because statutory right to recover under federal Railway Labor Act was independent of contractual claims even though both actions shared a common nucleus of facts), cert. denied, 479 U.S. 931, 107 S.Ct. 400, 93 L.Ed.2d 354 (1986). The Trusts’ claim, in contrast, is based entirely on the remedies provided for in the Trust Agreement. The Trusts do not point to any statutory right to compel an audit that is independent of the Trust Agreement. Furthermore, we noted in Amaro that the ERISA claim could not have been brought in the original action before the arbitrator, because the arbitrator did not have the authority to consider the resolution of this federal statutory issue. Amaro, 724 F.2d at 750. Because the ERISA claim could not have been brought in the original action before the arbitrator, it could not have been subject to claim preclusion. III. SEPARATE CHARACTER OF EMPLOYEE BENEFIT TRUST FUNDS The Trusts argue that the transactional approach applied in this circuit to res judica-ta determinations involving disputes between parties to a contract should not bar an action brought by a trust fund established under a trust agreement between a union and an employer. The Trusts point out that a trust fund is a separate and distinct entity from the employer and the union. Because it has no access to an employer’s payroll records, a trust fund has no way of determining whether a contribution is accurate unless the employer consents to an audit. The Trusts argue it will place an undue burden on them to conduct an audit every time they bring an action against an employer to recover delinquent payments. We disagree. Under the terms of the Trust Agreement, the employer is required to assume the cost of an audit. The Trusts must assume the costs of the audit only if the audit reveals that the employer has fulfilled all of his or her obligations under the Trust Agreement. We will not abandon the doctrine of res judicata simply because its application may be costly to a party whose claim proves to be groundless. A trust fund that wishes to preclude the application of res judicata to a future action based on a claim that the employers’ payments have been inaccurate, can reserve that right in any agreement that results in the dismissal with prejudice of an action for delinquent payments. See May, 899 F.2d at 1010 (parties can draft the terms of a settlement agreement so as to alter the preclusive effect of prior judgments (citing 18 Charles A. Wright et al, Federal Practice and Procedure, § 4443, at 384 (1981)). In this case, however, the settlement ■ agreements contained no provisions regarding their intended preclusive effect. We will not “supply by inference what the parties have failed to expressly provide, especially when *1433that inference would suspend the application of this circuit’s principles of res judicata.” May, 899 F.2d at 1011. IV. ATTORNEYS’ FEES Karr seeks attorneys’ fees for this appeal under 29 U.S.C. § 1132(g)(1). Section 1132(g)(1) provides, in pertinent part: “In any action under this subchapter... by a participant, beneficiary, or fiduciary, the court in its discretion may allow a reasonable attorney’s fee and costs of action to either party.” 29 U.S.C. § 1132(g)(1). In exercising our discretion to award attorneys’ fees under section 1132(g)(1), we consider: (1) [T]he degree of the opposing parties’ culpability or bad faith; (2) the ability of the opposing parties to satisfy an award of fees; (3) whether an award of fees against the opposing party would deter others from acting under similar circumstances; (4) whether the parties requesting fees sought to benefit all participants and beneficiaries of an ERISA plan or to resolve a significant legal question regarding ERISA; and (5) the relative merits of the parties’ positions. Sapper v. Lenco Blade, Inc., 704 F.2d 1069, 1073 (9th Cir.1983) (quoting Hummell v. S.E. Rykoff & Co., 634 F.2d 446, 452-53 (9th Cir.1980)). Karr has failed to make a showing that it is entitled to attorneys’ fees under this statute. Accordingly, Karr’s request to recover attorneys’ fees for this appeal is DENIED. The district court’s order granting summary judgment in favor of Karr on the ground that the Trusts’ action is barred under the doctrine of res judicata is AFFIRMED.
|
LIMITED_OR_DISTINGUISHED, CONFLICT_NOTED
|
724 F.2d 747
|
994 F.2d 692
|
D
|
Santiago Amaro v. The Continental Can Company
|
GOODWIN, Circuit Judge: Flying Tiger Line, Inc. (“Flying Tiger”) and the Flying Tiger pilots’ former union entered into a collectively bargained agreement regarding pilot pension benefits. Appellants, four former Flying Tiger pilots, seek enforcement of the terms of the summary plan description of the pension agreement pursuant to 29 U.S.C. § 1022(a)(1) of the Employee Retirement Income Security Act of 1974 (“ERISA”). The district court found that it lacked subject matter jurisdiction over appellants’ claim because (1) a Railway Labor Act-mandated arbitration board had determined appellants’ rights under the pension plan, and (2) ERISA does not provide an independent statutory right to enforcement of the summary plan description. We affirm. System Board of Adjustment Determination The Railway Labor Act requires that an air carrier and its employees establish a system board of adjustment with jurisdiction over disputes “growing out of grievances, or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditions.” 45 U.S.C. § 184. “No federal or state court has jurisdiction over the merits of any employment dispute subject to determination by a system board of adjustment.” De la Rosa Sanchez v. Eastern Airlines, Inc., 574 F.2d 29, 32 (1st Cir.1978). Railway Labor Act-mandated boards *694 are the “mandatory, exclusive, and comprehensive system for resolving grievance disputes.” Brotherhood of Locomotive Eng’rs v. Louisville & Nashville R.R. Co., 373 U.S. 33, 38, 83 S.Ct. 1059, 1062, 10 L.Ed.2d 172 (1963). Judicial review is appropriate only if a system board oversteps its jurisdiction, or if it commits fraud or corruption. 45 U.S.C. § 153(q). The collectively bargained agreement between Flying Tiger and the pilots’ former union, the Air Line Pilots Association, International (“ALPA”), provided for two pilot pension plans: the Fixed Pension Plan and the Variable Annuity Pension Plan. Pension benefits are calculable under either section 10.1 or section 10.2 of the Fixed Plan. It is undisputed that a pilot is entitled to the greater of the two calculable pensions under the Fixed Plan. Appellants and Flying Tiger also agree that a pilot who opts for a Fixed Plan benefit under section 10.1 is not entitled to a separate Variable Plan benefit. Appellants and Flying Tiger disagree whether a pilot who chooses a Fixed Plan benefit under section 10.2 is also entitled to a separate Variable Plan benefit. Appellants stress that the summary plan description expressly states that a pilot may opt for a Fixed Plan benefit under section 10.2 and also receive a benefit under the Variable Plan. Flying Tiger concedes that the terms of the summary plan description provide that the Variable Plan benefit is added to, rather than subtracted from, the benefit provided by section 10.2 of the Fixed Plan. It maintains, nonetheless, that the summary plan description, read in the context of the plan document and the bargaining history, contains a mistake which does not reflect the intent of Flying Tiger or ALPA, and therefore cannot be enforced. An employee pension plan falls within the scope of the Railway Labor Act and is subject to its mandatory arbitration procedures. Air Line Pilots Ass’n, Int’l v. Northwest Airlines, Inc., 627 F.2d 272, 275 (D.C.Cir.1980). Flying Tiger and appellant Long referred this dispute to the Retirement Board, a special system board of adjustment with authority to decide all disputes regarding the pension plan’s application, interpretation or administration. The Retirement Board rejected Long’s claim. Appellants concede that this determination is equally applicable to the other three pilots who are parties to this appeal. ERISA Claim Appellants maintain that the district court had subject matter jurisdiction to enforce the unambiguous terms of the summary plan description. 29 U.S.C. § 1022(a)(1) provides, in relevant part, that a summary plan description “shall be written in a manner calculated to be understood by the average plan participant, and shall be sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan.” If the statutory claim “is independent of the correct construction of the pension plan, [then] the District Court had jurisdiction of that statutory claim.” Air Line Pilots Ass’n, 627 F.2d at 277. The interpretation of ERISA, a federal statute, is a question of law subject to de novo review. Arnold v. Arrow Transp. Co. of Delaware, 926 F.2d 782, 785 (9th Cir.1991). The legislative history of ERISA does not reveal whether Congress intended to create a statutory right to enforce a summary plan description against a system board’s determination of the scope of the collectively bargained pension plan. To buttress their argument in favor of an independent statutory right, appellants rely on a number of cases that provide that in the event of a conflict between a pension plan and the express provisions of a summary plan description, the terms of the summary must prevail. See McKnight v. Southern Life & Health Ins. Co., 758 F.2d 1566, 1570-71 (11th Cir.1985) (employee entitled to pension pursuant to summary plan description even though plan itself did not provide such benefits); see also Senkier v. Hartford Life & Accident Ins. Co., 948 F.2d 1050, 1051 (7th Cir.1991) (must also demonstrate reliance on language of summary plan description); Hansen v. Continental Ins. Co., 940 F.2d 971, 982 (5th Cir.1991) (no need to prove detrimental reliance); Heidgerd v. Olin Corp., 906 F.2d 903, 907-08 (2d Cir.1990) (same); Edwards v. State Farm Mut. Auto. Ins. Co., 851 F.2d 134, *695 136-37 (6th Cir.1988) (same). The Ninth Circuit has not yet reached this issue. 1 These cases suggest that the Retirement Board had reason to defer to the express language of the summary plan description in the event of a contradiction between the summary and the plan itself. Nonetheless, the issue before this court is whether the district court had subject matter jurisdiction over appellants’ claim for relief. Without such jurisdiction, the district court cannot consider the correctness of the Retirement Board’s decision or the relevance of the McKnight line of cases. In limited circumstances, ERISA does provide independent statutory rights. In Ama-ro v. Continental Can Co., 724 F.2d 747 (9th Cir.1984), for instance, we held that section 510 of ERISA provides a statutory right independent of the construction of a pension agreement. Id. at 748-49. Section 510 prohibits “interference with the attainment of any rights to which a person may become entitled under the provisions of an employee benefit plan that falls within the coverage of ERISA.” Id. at 749. We concluded that a claim under section 510 is “not for benefits under a collective bargaining agreement. The employees, in fact, are not yet eligible for those benefits.” Id. Two other circuits have found an independent statutory claim based on a party’s breach of its fiduciary obligations to the pension. Placzek v. Strong, 868 F.2d 1013, 1014 (8th Cir.1989) (independent claim if breach of fiduciary duty to plan itself); Air Line Pilots Ass’n, 627 F.2d at 277 (independent claim if air carrier breached fiduciary duty through deliberate and unnecessary withholding of funds due pilots and use of funds to decrease its own contributions to trust fund). These decisions are distinguishable from the present case. The question whether an employer is interfering with the attainment of rights under a pension plan, for example, is a separate issue from the nature of those rights once they are attained by an employee. See Amaro, 724 F.2d at 749. In contrast, any claim relating to the construction of a pension plan can be transformed into a claim that a summary plan description was insufficiently accurate or complete. If a system board of adjustment issues a determination contrary to an employee’s construction of a pension plan, the employee can always claim that the summary plan was not “written in a manner calculated to be understood by the average plan participant, and [was not] sufficiently accurate and comprehensive to reasonably apprise such participants and beneficiaries of their rights and obligations under the plan.” 29 U.S.C. § 1022(a)(1). If we were to find subject matter jurisdiction over such a claim, we would eviscerate the Railway Labor Act’s system of arbitrating disputes. No longer would the decision of a system adjustment board be the final word on disputes “growing out of... the interpretation or application of agreements concerning rates of pay, rules, or working conditions.” 45 U.S.C. § 184. Nothing in ERISA’s legislative history supports such a sweeping change in the treatment of Railway Labor Act claims. To the contrary, Congress’s enactment of ERISA, which opened the federal courts to suits over the interpretation of pension plans, did not “modif[y] the exclusivity of this pattern of the Railway Labor Act.” Air Line Pilots Ass’n, 627 F.2d at 275. ERISA explicitly provides: “Nothing in this subchapter shall be construed to alter, amend, modify, invalidate, impair, or supersede any law of the United States (except as provided in sections 1031 and 1137(b) of this title) or any rule or regulation issued •under any such law.” 29 U.S.C. § 1144(d) (excepted sections irrelevant to present case). The present action, despite being clothed as an independent ERISA claim, is an attempt to relitigate the very issue decided by the Retirement Board. In determining the extent of the pilots’ benefits under the collectively bargained pension agreement, it was within the Retirement Board’s jurisdiction to consider the weight that should be accorded *696 to the summary plan description. 2 We therefore affirm the district court’s holding that it lacked subject matter jurisdiction over the interpretation of the summary plan description. Attorney’s Fees Both parties seek attorneys’ fees on appeal pursuant to 29 U.S.C. § 1132(g). Because we find in favor of Flying Tiger on the merits, we deny appellants’ request for attorneys’ fees. Furthermore, we deny Flying Tiger’s request for attorneys’ fees on the following grounds: appellants did not act in bad faith; any such award would have a deterrent effect on others bringing such suits; appellants’ action would have benefited other members of their pension plan; and, although we rule in Flying Tiger’s favor, appellant’s action was not without some merit. See Hummell v. S.E. Rykoff & Co., 634 F.2d 446, 453 (9th Cir.1980) (standard for awarding attorney’s fees under ERISA). AFFIRMED. 1. Appellants mischaracterizc a reference in Arnold as an endorsement of Edwards. In Arnold, an employee claimed that a summary plan description contained a promise of certain benefits. 926 F.2d at 784-85 n. 3. The court cited Edwards and related cases only to support its finding that the employee’s allegation based on the summary plan description constituted "a claim for benefits under the Retirement Plan and ERISA.” Id. at 785 n. 3; cf. id. at 787 (Ferguson, J., dissenting) (following Edwards and McKnight). 2. Consequently, the Retirement Board did not exceed its jurisdiction under 45 U.S.C. § 184, and its decision is not reversible pursuant to 45 U.S.C. § 153(q).
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LIMITED_OR_DISTINGUISHED
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724 F.2d 747
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938 F.2d 823
|
C
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Santiago Amaro v. The Continental Can Company
| "HARLINGTON WOOD, JR., Circuit Judge. Plaintiff Donald Powell sued his former employer, A.T. & T. Co(...TRUNCATED)
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CRITICIZED_OR_QUESTIONED
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End of preview. Expand
in Data Studio
Validate Your Authority: Precedent Treatment Dataset and Benchmarks
This repository contains data and code for analyzing how later judicial opinions treat earlier precedents, with a focus on negative and limiting treatments. It includes a filtered dataset suitable for model training/evaluation and scripts to reproduce experiments.
Background: Paul Hellyer’s Study and Annotations
Paul D. Hellyer’s empirical study examined the reliability of three U.S. citator systems (Shepard’s, KeyCite, and BCite) in reporting negative and limiting treatments of precedents. Hellyer manually read a stratified sample of citing opinions to determine the “ground truth” treatment of the cited (seed) opinion, then compared his judgments to each citator’s labels.
Key points about Hellyer’s annotations used in this project:
- Hellyer read each citing opinion in context and assigned a treatment judgment based on the legal effect on the seed case (e.g., overruled, reversed, distinguished, questioned, not followed).
- He recorded both the citator-provided label and his own “correct” judgment, allowing measurement of precision/recall by category and overall accuracy.
- The annotations cover both strong negatives (e.g., Overruled, Reversed) and softer limiting signals (e.g., Distinguished, Declined to extend, Not followed), along with meta signals like Disagreement recognized.
For details, see Hellyer’s paper: Hellyer, Paul D., empirical evaluation of citators.
This Paper: Validate Your Authority — Benchmarking LLMs on Multi‑Label Precedent Treatment Classification
This work introduces a benchmark that frames precedent treatment classification as a multi‑label problem spanning both strong negative and limiting signals. We evaluate multiple LLMs (closed and open) with zero‑shot and few‑shot prompting, and report performance across fine‑grained and high‑level labels. The dataset originates from Hellyer’s annotations and associated opinion texts, curated into a machine‑learning‑ready format. (Link forthcoming.)
Dataset
Primary file for sharing/experiments:
SOURCE_hf.csv
Included columns:
seed_case: the cited opinion (precedent) citation string.citing_case: the citing opinion citation string.hellyer_correct_label: Hellyer’s ground‑truth fine‑grained treatment label for this pair.seed_case_name: human‑readable name of the cited opinion.html_cleaned: cleaned citing‑opinion text segment(s) used for labeling and modeling.high_level_label: coarser roll‑up of treatment (e.g., Negative vs. Limiting/Other), used for high‑level evaluation.
The original full table (SOURCE.csv) contains additional audit/tracking fields (citator‑provided labels, notes, etc.). The helper script scripts/filter_source_csv.py generates the reduced file and raises the CSV field size limit to handle long HTML fields.
Abbreviations (Fine‑Grained Treatment Signals)
The following codes appear in Hellyer’s labels and/or citator labels:
- ACAN: Among conflicting authorities noted in
- AR: Abrogation recognized by
- C: Criticized by
- CID: Called into doubt by
- D: Distinguished by
- DAS: Disapproved as stated in
- DE: Declined to extend by
- DR: Disagreement recognized by
- DW: Disagreed with by
- IOR: Implied overruling recognized by
- LHR: Limitation of holding recognized by
- NF: Not followed by
- O: Overruled
- OR: Overruling recognized by
- Q: Questioned by
- R: Reversed by
Note: Different citators sometimes use overlapping or slightly different taxonomies; Hellyer’s ground‑truth label harmonizes to the most accurate treatment after reading the opinion.
Getting Started
- Use
SOURCE_hf.csvfor training/evaluation; it contains only the necessary fields for modeling and sharing. - If you need to regenerate the reduced CSV from
SOURCE.csv, run:
python3 scripts/filter_source_csv.py
Citation
If you use this dataset or code, please cite:
- Paul D. Hellyer, empirical evaluation of citators (see link above).
- Validate Your Authority: Benchmarking LLMs on Multi‑Label Precedent Treatment Classification (link forthcoming).
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