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Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 

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1

The Honorable Audrey G. Fleissig, United States Magistrate Judge for the

United States District Court for the Eastern District of Missouri, presiding by consent

of the parties pursuant to 28 U.S.C. § 636(c)(1). 

 United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

No. 05-1139

___________

David Knieriem, as personal *

representative of the Estate of *

Troy Siade, deceased, *

*

Appellant, *

* Appeal from the United States

 v. * District Court for the 

* Eastern District of Missouri.

Group Health Plan, Inc.; *

Bernard Mansheim, *

*

Appellees. *

___________

Submitted: October 12, 2005

Filed: January 19, 2006

___________

Before RILEY, HANSEN, and COLLOTON, Circuit Judges.

___________

RILEY, Circuit Judge.

David Knieriem (Knieriem), as personal representative of the estate of Troy

Siade (Siade), appeals the order of the district court1

 dismissing his claim, because the

relief sought against Siade’s employer-sponsored health care plan was not available

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Siade passed away shortly after the case was removed. Knieriem was

appointed personal representative of Siade’s estate. The district court permitted

Knieriem to be substituted as plaintiff, and allowed Knieriem to serve as both personal

representative and counsel in this action. 

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under the Employee Retirement Income Security Act of 1974 (ERISA),

§ 502(a)(3)(B), 29 U.S.C. § 1132(a)(3)(B). We affirm.

I. BACKGROUND

Siade had an employer-sponsored health care plan provided by Group Health

Plan, Inc. (GHP). The plan was governed by ERISA. GHP issued the health

insurance policy for the plan. In 2001, Siade was diagnosed with non-Hodgkin’s

lymphoma and sought GHP’s pre-approval for an allogeneic stem cell transplant.

GHP denied coverage on the basis the procedure was “investigational and unproven”

and therefore excluded under the plan’s policy.

In April 2004, following GHP’s denial of coverage, Siade filed a lawsuit in

Missouri state court seeking damages against GHP and Dr. Bernard Mansheim, Chief

Medical Officer of Coventry Health Care, GHP’s parent company (collectively, GHP).

Siade alleged GHP’s wrongful denial of coverage amounted to medical malpractice

and intentional infliction of emotional distress under Missouri law. GHP removed the

case to federal court based on ERISA preemption. The district court denied Siade’s

motion to remand, finding the state claims were preempted by ERISA, but granted

Siade leave to file an amended complaint to plead a claim under ERISA.

In his amended complaint, Siade2

 requested a jury trial and alleged GHP

breached its fiduciary duty by denying coverage. For relief, Siade requested the court

“order restitution by defendants to Plaintiff; to award Plaintiff a ‘surcharge’ as that

term was used in equity prior to the fusion of law and equity; to provide compensation

to Plaintiff for defendants’ breach of fiduciary duty; [and] to award attorney’s fees.”

GHP then moved to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) for

failure to state a claim under ERISA. The district court granted the motion, reasoning

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“[w]hile Plaintiff has phrased his request as for ‘restitution’ and a ‘surcharge for

breach of a fiduciary duty,’ Plaintiff is actually seeking monetary relief, and such

relief is not available under ERISA.” 

On appeal, Knieriem argues the district court erred in dismissing the claim

because ERISA allows a monetary award of restitution and a surcharge to the

beneficiaries of a decedent when the plan administrator improperly fails to authorize

a procedure. 

II. DISCUSSION

We review de novo the district court’s grant of a motion to dismiss pursuant to

Rule 12(b)(6), accepting all factual allegations in the complaint as true and granting

every reasonable inference in favor of the nonmovant. MM&S Fin., Inc. v. Nat’l

Ass’n of Sec. Dealers, Inc., 364 F.3d 908, 909 (8th Cir. 2004) (citing Stone Motor Co.

v. GMC, 293 F.3d 456, 464 (8th Cir. 2002)). “A motion to dismiss should be granted

only if it appears beyond doubt that the plaintiff can prove no set of facts to warrant

a grant of relief.” Gilmore v. County of Douglas, Neb., 406 F.3d 935, 937 (8th Cir.

2005) (citing Carter v. Arkansas, 392 F.3d 965, 968 (8th Cir. 2004)).

There is no dispute Siade did not receive the allogeneic stem cell transplant.

We will assume, as we must in reviewing a dismissal for failure to state a claim, GHP

breached its fiduciary duty by denying coverage for the procedure. The question

before us is whether the requested relief is available under ERISA.

Knieriem does not deny the relief requested is money damages. Instead, he

contends ERISA’s roots in the equitable law of trusts allow for monetary damages in

the present case. First, Knieriem argues, as a fiduciary, GHP held the money Siade

paid for health benefits in trust. Therefore, recovery is nothing more than the

restitution of the funds the fiduciary had an obligation to release. Knieriem’s second

argument is monetary recovery in the form of a surcharge is available as an equitable

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remedy when, as here, a trustee has gained personally from wrongful action taken in

managing a trust. We disagree.

A. Restitution

As the Supreme Court has oft-iterated, “ERISA is a comprehensive and

reticulated statute, the product of a decade of congressional study of the Nation’s

private employee benefit system.” Great-West Life & Annuity Ins. Co. v. Knudson,

534 U.S. 204, 209 (2002) (internal quotations omitted). The Court similarly has

repeated its reluctance “‘to tamper with [the] enforcement scheme’ embodied in the

statute by extending remedies not specifically authorized by its text.” Id. (quoting

Mass. Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 147 (1985)) (alteration in original).

The statute’s failure to include certain remedies, as the Court has noted, was not an

oversight; rather, “ERISA’s carefully crafted and detailed enforcement scheme

provides strong evidence that Congress did not intend to authorize other remedies that

it simply forgot to incorporate expressly.” Id. (internal quotations omitted). Vague

notions that ERISA’s purpose would be defeated if recovery was limited are

inadequate to overcome the basic words of the statute. Mertens v. Hewitt Assocs.,

508 U.S. 248, 261 (1993); Kerr v. Charles F. Vatterott & Co., 184 F.3d 938, 943 (8th

Cir. 1999).

ERISA’s civil enforcement provision, found in section 1132, lists six types of

civil actions that may be pursued for violations of the statute. See Russell, 473 U.S.

at 139-40. The present case was brought pursuant to section 1132(a)(3), which allows

a civil action, “by a participant, beneficiary, or fiduciary . . . (B) to obtain other

appropriate equitable relief (i) to redress such violations or (ii) to enforce any

provisions of . . . the terms of the plan.” 29 U.S.C. § 1132(a)(3)(B). This provision

allows an individual plan participant to seek equitable remedies for breach of fiduciary

duty in his individual capacity. See Varity Corp. v. Howe, 516 U.S. 489, 510-13, 515

(1996) (finding section 1132(a)(3) allows individual actions for equitable relief for

breaches of fiduciary duty). Recovery is limited, however, to “classic” equitable

remedies, Mertens, 508 U.S. at 257-58, “such as injunctive, restitutionary, or

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mandamus relief, and does not extend to compensatory damages,” Kerr, 184 F.3d at

943.

Restitution can be equitable or compensatory, and the distinction lies in the

origin of the award sought. Id. at 944. “Restitution seeks to punish the wrongdoer by

taking his ill-gotten gains, thus, removing his incentive to perform the wrongful act

again. Compensatory damages on the other hand focus on the plaintiff’s losses and

seek to recover in money the value of the harm done to him.” Id. (citing 1 Dan B.

Dobbs, Law of Remedies § 4.1(1), at 369-71 (2d ed.1993)). Therefore, despite the

label attached to the remedy in the present case, we must look to the origin of the

relief sought to determine whether it is equitable or compensatory.

Knieriem requests monetary relief for the harm suffered. Knieriem states in his

brief, “The relief the estate seeks is the monetary benefit that GHP should have paid

for the withheld procedure, including any ancillary profit either GHP or Mansheim

made from the denial of the benefit.” In his prayer, Knieriem asks for restitution,

surcharge, and “compensation to Plaintiff for defendants’ breach of fiduciary duty.”

Knieriem’s requested relief is essentially compensatory.

The Supreme Court and this circuit precedent precludes an award of

compensatory damages under section 1132(a)(3)(B). See Mertens, 508 U.S. at 258-

59, cited in Kuhl v. Lincoln Nat’l Health Plan of Kansas City, Inc., 999 F.2d 298, 304-

05 (8th Cir. 1993). In Kuhl, the insurer delayed authorizing a covered surgical

procedure while searching for a network hospital to perform the procedure. Id. at 300.

By the time the insurer approved surgery, the insured’s condition had deteriorated

such that surgery was no longer a viable option. The insured died, and his estate filed

an action against the insurer in state court alleging, inter alia, medical malpractice and

emotional distress. Id. Following removal based on ERISA preemption, the court

found plaintiff’s state tort claims were preempted. Id. at 301. Pertinent to the case at

bar, the court also dismissed a subsequent complaint for breach of fiduciary duty

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brought pursuant to 29 U.S.C. § 1132(a)(3)(B). Id. Citing circuit and Supreme Court

precedent, we said,

We have previously held that monetary damages are not available

under section [1132](a)(3)(B)(i). In Novak [v. Andersen Corp.], we . . .

held that an award of monetary damages is a legal remedy, not an

equitable one. This interpretation has recently been vindicated by the

Supreme Court. After an extensive review of the history of equitable

remedies and the statutory language of section [1132](a)(3), the Court

concluded that damages do not constitute “other equitable relief.” 

Id. at 304-05 (citing Mertens, 508 U.S. at 258-59; Novak v. Andersen Corp., 962 F.2d

757, 759, 761 (8th Cir.1992)) (internal citations omitted). We concluded the “claim

for monetary damages was not cognizable under section [1132](a)(3)(B)(i).” Id. at

305.

Knieriem argues his case is distinguishable from Kuhl, because in the present

case the funds sought were held in trust, are identifiable, and should have been used

to pay for the procedure. These distinctions are unavailing. The funds sought are not

identifiable, or even known, because Siade never incurred the requested transplant

costs. As noted supra, whether a remedy is restitutionary or compensatory is

determined by the origin of the award. In Kuhl, the action for breach of fiduciary duty

was brought pursuant to section 1132(a)(3)(B), and the recovery sought was a

monetary award from the insurer to compensate the estate for the insurer having

delayed treatment to the insured. Id. at 304. In the present case, Knieriem alleged

breach of fiduciary duty pursuant to section 1132(a)(3)(B), and he sought monetary

recovery from the insurer to compensate the estate for the insurer denying the

requested procedure. The remedy sought in this case is premised on the same theory

as the remedy sought in Kuhl.

Knieriem next argues if Siade were still alive, this action would readily be

available under ERISA and, therefore, his death should not give GHP a free pass. The

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crux of Knieriem’s argument is GHP was unjustly enriched by denying the treatment,

and the remedy is restitution of the funds to Siade’s estate. Knieriem suggests the

district court reached the opposite result by misapplying this court’s holding in Geissal

v. Moore Medical Corp., 338 F.3d 926 (8th Cir. 2003).

In Geissal, the insurer (the Moore Plan) wrongfully terminated Geissal’s health

insurance policy on the basis he was covered by another policy (the TWA Plan). Id.

at 929. After the Moore Plan terminated coverage, the TWA Plan covered the costs

of Geissal’s cancer treatment, paying over $86,000 to health care providers, and

reimbursing Geissal over $6,500 for out-of-pocket expenses. Id. at 929-30. Geissal

incurred approximately $4,400 in non-covered medical expenses. Id. at 930. Geissal

filed a lawsuit against the Moore Plan seeking compensation for past due benefits, as

well as injunctive and equitable relief pursuant to section 1132(a)(1)(B). Id. at 930.

Geissal died, and his wife, as representative of his estate, was substituted as plaintiff.

Id. The estate had no obligation to reimburse the TWA Plan, nor did the TWA Plan

assert claims against the Moore Plan. Id. Nonetheless, the estate sought to recover

the amount of benefit payments paid by the TWA Plan, arguing the Moore Plan would

have been obligated to pay those expenses but for its wrongful termination of

coverage. Id. Geissal claimed the estate was entitled to recover those benefit

payments to prevent the self-funded Moore Plan from being unjustly enriched. Id. at

930-31. The district court denied recovery under section 1132(a)(1)(B) on the basis

the plan beneficiary was deceased. Id. at 931. On appeal, we found section

1132(a)(1)(B) would allow the estate to recover any money benefits due under the

plan before the beneficiary died. Id. at 931 n.1. However, we concluded the language

of the statute, as well as the terms of the Moore Plan, precluded the estate from

recovering medical payments paid by a third party–the TWA Plan. Id. at 932. The

estate had “no claim for legal restitution.” Id.

Relying on Great-West Life & Annuity Insurance Co. v. Knudson, 534 U.S. at

209, Geissal argued section 1132(a)(1)(B) allowed the estate to recover the benefits

paid by the TWA Plan under a legal restitution theory. Geissal, 338 F.3d at 932. We

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distinguished Knudson, reasoning the Court had not addressed recovery for legal

restitution under section 1132(a)(1)(B). Rather, in Knudson, the Court found legal

restitution was not recoverable under section 1132(a)(3)(B) because it was not

equitable relief. Id. We reasoned that under section 1132(a)(1)(B) the Court similarly

would limit recovery “to a claim in which the plaintiff can ‘show just grounds for

recovering money to pay for some benefit the defendant had received from him.’” Id.

(quoting Knudson, 534 U.S. at 213) (emphasis in original). We concluded Geissal’s

estate was not entitled to recover under a legal restitution theory pursuant to section

1132(a)(1)(B), because the Moore Plan was not unjustly enriched due to benefits

directly bestowed by Geissal or his estate. Id. 

Applying our precedent, it is abundantly clear Knieriem seeks a remedy simply

not available under ERISA. Unlike Geissal, Siade never paid or incurred any covered

or potentially covered expenses. Knieriem seeks monetary damages for expenses

GHP would have paid, if Siade had received the transplant. Despite the use of

semantics, Knieriem seeks monetary relief that does not constitute “other appropriate

equitable relief” under section 1132(a)(3)(B). See Bast v. Prudential Ins. Co. of Am.,

150 F.3d 1003, 1010-11 (9th Cir. 1998) (finding the money saved by wrongfully

denying experimental cancer treatment was not “other appropriate equitable relief”

under section 1132(a)(3), because the money did not form the basis of a constructive

trust, and was distinguishable from cases where the money taken from pension plans

by fiduciaries did form the bases of constructive trusts).

B. Surcharge

As a second basis for recovery, Knieriem argues a surcharge is available as an

equitable remedy, providing monetary recovery when a trustee has gained personally

from a wrongful action taken in managing a trust. Knieriem contends this court

similarly awarded an insured the disgorged profits of his insurer in Parke v. First

Reliance Standard Life Insurance Co., 368 F.3d 999 (8th Cir. 2004). Knieriem

misapplies Parke to the present case.

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In Parke, plaintiff’s monthly long-term disability payments were wrongfully

withheld by the insurer. Id. at 1003. One question we addressed on appeal was

whether prejudgment interest was “other appropriate equitable relief” under section

1132(a)(3)(B) in light of Knudson. Id. at 1006-07. We determined the relief sought

was an “accounting for profits,” a limited exception under section 1132(a)(3)(B),

allowing legal relief to disgorge the profits realized by wrongfully withholding

plaintiff’s property. Id. at 1008-09 (citing Knudson, 534 U.S. at 214 n.2). As we

explained in Parke, 

An accounting for profits is one of a category of traditionally

restitutionary remedies in equity, and is often invoked in conjunction

with a constructive trust. A constructive trust is imposed when a

defendant has possession of particular funds or property that in good

conscience belong to the plaintiff. The plaintiff must specifically identify

the particular funds or property in order to obtain the constructive trust;

it is not enough that the defendant merely owes the plaintiff some money.

Id. at 1008 (citations omitted) (emphasis added).

Siade did not receive the requested transplant and never incurred any related

medical or hospital expenses, i.e., benefits payable. Consequently, GHP holds no

readily identifiable funds or property belonging to Siade’s estate to form the basis of

a constructive trust. The accounting for profits exception in Parke (interest on

withheld benefits payable) has no application in the present case.

III. CONCLUSION

Merely re-labeling the relief sought as “restitution” or “surcharge” does not

alter the nature of a remedy from monetary to equitable. In the present case, Knieriem

seeks money damages which are unavailable under section 1132(a)(3)(B) of ERISA.

Thus, we affirm.

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