Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-1_05-cv-01319/USCOURTS-caed-1_05-cv-01319-7/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1001 E.R.I.S.A.: Employee Retirement

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IN THE UNITED STATES DISTRICT COURT FOR THE

EASTERN DISTRICT OF CALIFORNIA

TRUDY G. HEMPHILL, )

)

)

)

Plaintiff, )

)

vs. )

)

)

PERSONAL REPRESENTATIVE OF )

THE ESTATE OF JAMES J. )

RYSKAMP, JR., et al., )

)

)

Defendant. )

)

)

No. CV-F-05-1319 OWW/SMS

ORDER DENYING DEFENDANTS'

MOTION TO DISMISS (Doc. 43)

On October 18, 2005, plaintiff Trudy G. Hemphill filed a

Complaint in this court naming as defendants the Personal

Representative of the Estate of James J. Ryskamp, Jr. (Ryskamp

Estate); James J. Ryskamp, Jr., M.D., Inc. (Ryskamp Inc.);

Ryskamp-Takayama 401(k) Profit Sharing Plan (Ryskamp-Takayama

Plan); James J. Ryskamp, Jr., M.D., Inc. Money Purchase Pension

Plan (Ryskamp MP Plan); James J. Ryskamp, Jr., M.D., Inc. Profit

Sharing Plan (Ryskamp PS Plan); Norio Takayama; Norio Takayama,

M.D., Inc. Plaintiff is now proceeding under a Second Amended

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Complaint (SAC). The SAC drops Norio Takayama and Norio

Takayama, M.D., Inc. as defendants and adds as a defendant Judith

Dickison Ryskamp, individually and as Trustee of the James J.

Ryskamp, Jr. and Judith Dickison Ryskamp Living Trust (Ryskamp

Trust).

Defendants move to dismiss the SAC pursuant to Rule

12(b)(6), Federal Rules of Civil Procedure, for failure to state

claims upon which relief can be granted. Defendants argue that

this action is barred by the applicable statutes of limitation. 

See discussion infra. 

A. Pertinent Allegations of SAC and Prayers for Relief.

The SAC alleges that this action is “for injunctive,

equitable, declaratory and monetary relief ... pursuant to

Section 502 of ERISA, 29 U.S.C. § 1132. The SAC further alleges

that plaintiff married Ryskamp in 1981 and became employed by

Ryskamp Inc. in 1982. Because of her employment, plaintiff

became a vested participant in the Ryskamp MP Plan, the Ryskamp

PS Plan and the Ryskamp-Pollock Plan, which resulted from the

merger in 1989 of the Ryskamp MP Plan and the Ryskamp PS Plan. 

Plaintiff obtained a judgment of dissolution of her marriage to

Ryskamp on January 17, 1992. The SAC further alleges in

pertinent part:

17. Upon information and belief, Plaintiff

alleges that in 1993, other participants in

the Ryskamp-Pollock Plan were afforded the

opportunity to self-invest the funds held in

their employee benefit plan accounts. Ms.

Hemphill was never informed of such an

opportunity and was never afforded the

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opportunity to self-invest her interests in

the Defendant Plans or their predecessors.

...

19. A Stipulated Qualified Domestic

Relations Order (‘QDRO’) was entered on

August 10, 1994 in the marital dissolution

proceeding involving Ms. Hemphill and

Ryskamp. The QDRO created and assigned to

Ms. Hemphill, as an alternate payee, the

right to $50,000 of Ryskamp’s interest in the

Ryskamp-Takayama Plan. By the terms of the

QDRO, Ms. Hemphill could receive this

interest in the Ryskamp-Takayama Plan

pursuant to her written instructions at any

time following the date the QDRO was approved

by the Plan Administrator of the RyskampTakayama Plan.

20. The QDRO further granted Ms. Hemphill

all of the rights and election privileges

afforded to active participants in the

Ryskamp-Takayama Plan.

21. The QDRO also specified that the

Ryskamp-Takayama Plan was obligated to

provide Ms. Hemphill with ‘all notices and

information with respect to the retirement

benefits as herein divided, including, for

example, annual reports, annual accounts, any

new or revised retirement booklets or

bulletins.’

22. The court in the marital dissolution

proceeding entered other orders on August 11,

1994 regarding the division of community

property and non-community property between

Ms. Hemphill and Ryskamp (‘August 11, 1994

Orders’). These orders stated that Ms.

Hemphill was entitled to not only $50,000 of

Ryskamp’s benefits under the Ryskamp-Takayama

Plan created by the QDRO but also to her

vested interest in three other employee

benefit plans or their successors. Ms.

Hemphill was entitled to (1) an amount not

less than $5,668 in the Ryskamp MP Plan, or

any successor; (2) an amount not less that

$2,661 in the Ryskamp PS Plan, or any

successor; and (3) an amount not less that

$4,600 in the Ryskamp-Pollock Plan, or any

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successor. The August 11, 1994 Orders

further stated that Ms. Hemphill and Ryskamp

would cooperate in the process of

accomplishing the distributions set forth in

the August 11, 1994 Orders in a timely

fashion.

23. On September 8, 1994, Ryskamp, as Plan

Administrator and Trustee of the RyskampTakayama Plan, certified the QDRO as a

qualified domestic relations order and

approved the distribution of benefits to Ms.

Hemphill in accordance with the QDRO.

24. On or about September 15, 1994, Ms.

Hemphill received papers from the Defendant

Plans’ third party administrator (the ‘TPA’)

regarding her right to elect distribution of

the smallest of the four benefits - the

$2,661 - specified in the August 11, 1994

Orders. She did not receive any papers

regarding distribution of the three larger

amounts - the $50,000, the $5,668 and the

$4,600. When Ms. Hemphill asked the TPA

about distribution of the three larger

amounts, the TPA informed her that she would

not receive distribution paperwork for the

three larger amounts until the forms for the

smallest amount were completed and returned.

25. In mid-1996, Ms. Hemphill’s accountant

requested, on Ms. Hemphill’s behalf,

distribution and accounting of all four

amounts specified in the August 11, 1994

Orders. Ryskamp never did provide

distribution election forms to Ms. Hemphill

following her accountant’s request in 1996.

26. Ms. Hemphill contacted the TPA directly

in 2002 to request distribution of her

benefits in the Defendant Plans. The TPA

referred Ms. Hemphill to make her inquiries

to the Ryskamp, Inc. ‘plan administrative

committee’ but did not inform her how to

contact the plan administrative committee. 

The TPA further informed Ms. Hemphill that

she could not receive a distribution from the

Defendant Plans because Ryskamp had not yet

filed tax forms for year 2001 and that she

would have to wait until his tax forms were

filed before she could receive any benefits. 

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27. Having received none of the information

she requested, Ms. Hemphill sent Ryskamp a

letter on August 4, 2003 requesting

distribution of her benefits under the

Defendant Plans, the forms necessary for the

distribution, and account statements for her

interest in the Defendant Plans. Ms.

Hemphill sent the August 4, 2003 letter via

certified mail to both Ryskamp’s home and

office. Both letters were received. 

However, Ryskamp failed to respond.

28. On November 24, 2004, the TPA sent Ms.

Hemphill distribution election forms for a

$50,000 benefit from the Ryskamp Plan - i.e.,

the amount originally awarded to Ms. Hemphill

in the QDRO, with no earnings in the

subsequent ten years.

29. On or around December 3, 2004, Ms.

Hemphill contacted the TPA by telephone and

by letter to request, again, copies of

account statements of her interests, summary

annual reports, summary plan descriptions,

and Form 5500 Annual Return/Reports for the

Defendant Plans from 1990 to present.

30. The TPA replied on December 20, 2004,

stating that Ms. Hemphill should not contact

it regarding her interest in the Defendant

Plans but should contact the Ryskamp, Inc.

plan administrative committee. Again, Ms.

Hemphill was not told how and where the

Ryskamp, Inc. plan administrative committee

could be contacted. The TPA asked Ms.

Hemphill not to contact it in the future but

to contact its attorney.

31. On December 31, 2004, Ms. Hemphill sent

a letter to the TPA’s attorney requesting

copies of account statements of her

interests, summary annual reports, summary

plan descriptions, documents showing where

her interests were being held by the

Defendant Plans, documents regarding changes

made to the Defendant Plans and Form 5500

Annual Return/Reports for the Defendant Plan

[sic] and their predecessors from 1990 to

present for the express purpose of accepting

a rollover distribution of her benefits in

the Defendant Plans. She received no

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response.

32. On February 3, 2005, Ms. Hemphill wrote

to Ryskamp, through his attorney, to request

Summary Plan Descriptions, Summaries of

Material Modifications, Form 5500s, her

individual benefit statements, and banking

and brokerage statements that reveal where

her plan benefits were being held and have

been held from 1990 to the date of the

letter. Ryskamp failed to respond. 

33. On March 29, 2005, Ms. Hemphill, through

her attorney, made yet another written

request for Ryskamp and the TPA for

information and documents. The March 29,

2005 letter reiterated Ms. Hemphill’s

requests for an accounting of her interest in

the Defendant Plans and their predecessors

from August 1994 to the date of the letter,

copies of the Summary Plan Descriptions,

Summaries of Material Modifications, Summary

Annual Reports, Forms 5500, and account

benefit statements from Ms. Hemphill’s

interests in the Defendant Plans and their

predecessors from 1994 to the date of the

letter.

34. On April 29, 2005, Ryskamp, through his

attorney, provided a limited set of old

documents that were responsive to only a

small portion of Ms. Hemphil’s March 29, 2005

request. Ryskamp provided no documents for

any year later than 1999 for the Defendant

Plans or their predecessors, no documents for

the Ryskamp MP Plan and the Ryskamp PS Plan

in any year, and no accounting. Of the

documents provided, there was only one

Summary Plan Description for only one of the

plans, two Plan Annual Reports for just one

year for two plans, Forms 5500s for a handful

of years for only the Ryskamp-Takayama Plan

and one year of the Ryskamp-Pollock Plan,

account statements regarding Ms. Hemphil’s

benefits for the Ryskamp-Takayama Plan for

1994 through 1999. Ms. Hemphill’s request

for information currently remains

unfulfilled. 

35. Ms. Hemphill’s many inquiries to the

fiduciaries of the Defendant Plans and their

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predecessors regarding her entitlement to

benefits and many requests for an accounting

and a distribution of her benefits resulted

in either no response or only referrals to

other individuals or entities who were

equally unwilling to respond to Ms. Hemphill. 

Ms. Hemphill has not received any written

denial or approval of her requests for an

accounting or distribution of benefits. She

also has not received any explanation or

clarification of her rights regarding her

entitlement to benefits under the Defendant

Plans or their predecessors. The Defendants

have refused to provide, and have never

provided, Ms. Hemphill with complete

documentation regarding her benefits and have

refused to distribute, and have never

distributed, the benefits to which she is

entitled. The Defendants have never provided

Ms. Hemphill with an adequate accounting of

her benefits. In light of the repeated

failure of the Defendants to provide any

meaningful response to Ms. Hemphill’s many

inquiries, Ms. Hemphill has exhausted her

administrative remedies under the Defendant

Plans and their predecessors, or is otherwise

excused from doing so because such remedies

would be futile.

36. Plaintiff alleges, upon information and

belief based on documents recently obtained

from Defendant Plans’ former TPA, that before

and following Ryskamp’s death in September

2005, assets of the Defendant Plans,

including benefits to which Ms. Hemphill was

entitled, were distributed to Mrs. Ryskamp,

the Ryskamp Estate, and/or the Ryskamp Trust,

as Ryskamp’s beneficiary or beneficiaries

under the Defendant Plans.

37. Upon information and belief based on

documents recently obtained from Defendant

Plans’ former TPA, Ryskamp and/or Ryskamp

Inc. diverted assets of the Defendant Plans,

some of which rightfully belonged to Ms.

Hemphill, to Ryskamp Inc. for business

purposes and/or to Ryskamp as an individual.

38. Upon information and belief based on

documents recently obtained from Defendant

Plans’ former TPA, Plaintiff alleges that,

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while Ryskamp and/or Ryskamp Inc. were

serving as fiduciaries to the Defendant Plans

and their predecessors, Ryskamp and/or

Ryskamp Inc. invested assets of those plans

in risky, speculative investments that are

not permitted under federal securities laws

for plans of their kind and size. As a

result of these speculative investments,

Ryskamp and/or Ryskamp Inc. exposed the plans

to excessive risk, and these speculative

investments resulted in large losses to the

plans.

39. Upon information and belief based on

documents recently obtained from Defendant

Plans’ former TPA, Ryskamp and Ryskamp Inc.

failed to properly manage and account for the

assets of the Defendant Plans, and their

failures resulted in thecurrent [sic]

situation, where hundreds of thousands of

dollars of plan assets may no longer be

accounted for.

The SAC alleges five claims for relief. The First Claim for

Relief is for declaratory relief against all defendants pursuant

to 28 U.S.C. § 2201 and 29 U.S.C. § 1132(a)(3) and prays for the

following relief:

A. Declare that Ms. Hemphill is entitled to

accrued vested benefits under the Defendant

Plans, including all interest and earnings

that accrued or should have accrued on the

principal amounts, that Ms. Hemphill is

entitled to self-direct the investment of her

plan account under the Defendant Plans and

should have been entitled to do so when other

participants were afforded that opportunity,

and that Ms. Hemphill is entitled to request

and receive documents as provided under ERISA

§§ 104(b) and 105(a).

B. Declare that any benefits arising from

Ryskamp’s participation in the Defendant

Plans that were received by the Ryskamp

Estate, Ryskamp Trust, and/or Mrs. Ryskamp

include those benefits to which Ms. Hemphill

was entitled under the Defendant Plans and

are held in constructive trust for her, and

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that Ms. Hemphill is therefore entitled to

such benefits that were so distributed.

The Second Claim for Relief is a claim for benefits, to

enforce her rights, and clarify her rights against the Ryskamp

Plan and the Ryskamp-Takayama Plan pursuant to 29 U.S.C. §

1132(a)(1)(B). The Second Claim for Relief prays in pertinent

part for:

A. Order an accounting of Ms. Hemphill’s

benefits under the Defendant Plans;

B. Clarify Ms. Hemphill’s rights under the

Defendant Plans, including but not limited

to, the right to self-direct the investment

of her plan account, to request and receive

plan documents, and to receive a distribution

of benefits, including interest and earnings.

C. Order distribution, to Ms. Hemphill, of

her benefits, including all interest and

earnings that accrued or should have accrued

on the principal amounts, under the Defendant

Plans ... 

The Third Claim for Relief against the Ryskamp Estate,

Ryskamp Trust and Ryskamp Inc. is for breach of fiduciary duty

pursuant to 29 U.S.C. §§ 1132(a) and 1132(a)(3), alleging that

Ryskamp and Ryskamp Inc. “engaged in a prohibited transaction in

violation of ... 29 U.S.C. § 1106(a)-(b), by diverting the assets

of the Defendant Plans and their predecessors to Ryskamp Inc. for

business purposes and/or to Ryskamp as an individual”; that

Ryskamp and Ryskamp Inc. wrongfully profited from the prohibited

transaction by using plan assets for their own benefit”; and that

Ryskamp and Ryskamp Inc. breached their fiduciary duties under 29

U.S.C. § 1104(a)(1) by engaging in the prohibited transaction, by

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failing and refusing to provide to plan information and documents

to plaintiff concerning her rights and benefits; failing and

refusing to provide plaintiff with an accounting of her benefits

under the Defendant Plans; failing to provide plaintiff with all

of the rights and privileges afforded to participants and

beneficiaries under the Defendant Plans; and engaging in

speculative, risky investment of plan assets. The Third Claim

for Relief prays for a declaration that Ryskamp and Ryskamp Inc.

breached their fiduciary duties to plaintiff; an injunction

enjoining Ryskamp Inc. from further violation of its fiduciary

duties; a constructive trust on any “ill-gotten profits”

resulting from the alleged breaches of fiduciary duty;

disgorgement from the Ryskamp Estate, Ryskamp Trust, and Ryskamp

Inc. of any “ill-gotten profits” from the alleged breaches of

fiduciary duty; restoration from the Ryskamp Estate, Ryskamp

Trust, and Ryskamp Inc. of any losses resulting from the alleged

breaches of fiduciary duty; allocation of restored losses and

profits to the individual accounts of participants under the

Defendant Plans; an injunction precluding the Ryskamp Estate,

Ryskamp Trust, and Ryskamp Inc. and any other successor

fiduciaries from refusing to extend to plaintiff the same rights

and privileges of other participants and beneficiaries under the

Defendant Plans; an injunction preventing Ryskamp Inc and any

other successor plan administrators from denying requests under

29 U.S.C. §§ 1024(a) and 1025(a) by participants in the Defendant

Plans; remove Ryskamp and/or Ryskamp Estate, Ryskamp Trust and

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Ryskamp Inc as fiduciaries of the Defendant Plans and bar them

from ever serving as fiduciaries of the Defendant Plans in the

future; and appoint an independent fiduciary “for both of the

Defendant Plans”. 

The Fourth Claim for Relief is against Ryskamp Inc. for

injunctive relief and nondisclosure penalties pursuant to 29

U.S.C. § 1132(c)(1) and prays for the following relief:

A. Order production of the following: (1)

governing plan instruments, including the

plan document and trust agreement, of the

Defendant Plans and their predecessors in

effect at any time from September 18, 1981 to

present, and all amendments thereto; (2)

Summary Plan Descriptions of the Defendant

Plans and their predecessors issued at any

time from September 18, 1981 to present, and

all Summaries of Material Modifications

thereto; (3) all notices pursuant to ... 29

U.S.C. § 1054(h), with regard to any of the

Defendant Plans and their predecessors from

September 18, 1981 to present; (4) all

notices of termination of any of the

Defendant Plans or their predecessors from

September 18, 1981 to present; (5) the most

recent Forms 5500 for both of the Defendant

Plans and each of their predecessors, with

all schedules and attachments thereto; (6)

the most recent Summary Annual Reports for

each of the Defendant Plans and their

predecessors; and (7) annual account benefit

statements for Ms. Hemphill’s interests in

the Defendant Plans and/or its predecessors

from 1994 to present;

B. Award Plaintiff penalties of $110 per

day, per document, pursuant to ... 29 U.S.C.

§ 1132(c) and 29 C.F.R. § 2570.502(e)-1, from

the date the Court determines that Ms.

Hemphill first made a request for the

document to the date that the plan

administrator for the Defendant Plans

provides Ms. Hemphill with all documents

required by ... 29 U.S.C. § 1024(b)(4) and

1025(a).

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The Fifth Claim for Relief is against Ryskamp Inc., Ryskamp

Estate, Ryskamp Trust, and Mrs. Ryskamp for equitable and

injunctive relief pursuant to 29 U.S.C. § 1132(a)(3) and prays

for a declaration that these defendants are wrongfully holding

benefits to which plaintiff is entitled and of which plaintiff

was wrongfully deprived; enjoin these defendants from dissipating

these benefits; and imposing a constructive trust on these

benefits and any “ill-gotten profits” on these benefits. 

B. Governing Standards.

Rule 12(b)(6), Federal Rules of Civil Procedure, provides

that a motion to dismiss may be made in the plaintiff “fails to

state a claim upon which relief can be granted.” However,

motions to dismiss under Rule 12(b)(6) are disfavored and rarely

granted. The question before the court is not whether the

plaintiff will ultimately prevail; rather, it is whether the

plaintiff could prove any set of facts in support of his claim

that would him to relief. See Hishon v. King & Spaulding, 467

U.S. 69, 73 (1984). “A complaint should not be dismissed unless

it appears beyond doubt that plaintiff can prove no set of facts

in support of his claim that would entitle him to relief.” Van

Buskirk v. CNN, Inc., 284 F.3d 977, 980 (9 Cir.2002)(citations th

omitted). 

In decided whether to grant a motion to dismiss under Rule

12(b)(6), the court “accept[s] all factual allegations of the

complaint as true and draw[s] all reasonable inferences” in the

light most favorable to the nonmoving party. TwoRivers v. Lewis,

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174 F.3d 987, 991 (9 Cir.1991); see also Rodriguez v. th

Panayiotou, 314 F.3d 979, 983 (9 Cir.2002). A court is not th

“required to accept as true allegations that are merely

conclusory, unwarranted deductions of fact, or unreasonable

inferences.” Sprewell v. Golden State Warriors, 266 F.3d 979,

988 (9 Cir.2001). Immunities and other affirmative defenses th

may be upheld on a motion to dismiss only when they are

established on the face of the complaint. See Morley v. Walker,

175 F.3d 756, 759 (9 Cir.1999); Jablon v. Dean Witter & Co.,

th

614 F.2d 677, 682 (9 Cir. 1980). th

C. Merits of Motion.

Defendants contend that all five claims alleged in the SAC

are barred by “at least” two statutes of limitation.

1. California Code of Civil Procedure § 337.5(3).

First, defendants contend, the applicable statute of

limitations is set forth in California Code of Civil Procedure §

337.5(3). Section 337.5(3) provides a ten year statute of

limitation for “[a]n action upon a judgment or decree of any

court ... of any state within the United States.” Defendants

also refer to California Family Code § 291:

A judgment or order for possession or sale of

property made or entered pursuant to this

code is subject to the period of

enforceability and the procedure for renewal

provided by Chapter 3 (commencing with

Section 683.010) of Division 1 of Title 9 of

Part 2 of the Code of Civil Procedure. 

California Code of Civil Procedure § 683.010 provides: “Except as

otherwise provided by statute or in the judgment, a judgment is

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enforceable under this title upon entry.” California Code of

Civil Procedure § 683.020 provides:

Except as otherwise provided by statute, upon

the expiration of 10 years after the date of

entry of a money judgment or a judgment for

possession or sale of property:

(a) The judgment may not be 

enforced.

(b) All enforcement procedures

pursuant to the judgment or to a writ or

order issued pursuant to the judgment shall

cease.

(c) Any lien created by an 

enforcement procedure pursuant to the

judgment is extinguished. 

Defendants also refer to the definition of a qualified domestic

relations order (QDRO) in 29 U.S.C. § 1056(d)(3)(B):

(i) the term ‘qualified domestic relations

order’ means a domestic relations order -

(I) which creates or

recognizes the existence of an alternate

payee’s right to, or assigns to an alternate

payee the right to, receive all or a portion

of the benefits payment with respect to a

participant under a plan, and

(II) with respect to which the

requirements of subparagraphs (C) and (D) are

met, and

(ii) the term ‘domestic relations order’

means any judgment, decree, or order

(including approval of a property settlement

agreement) which -

(I) relates to the provision 

of child support, alimony payments, or

marital property rights of a spouse, former

spouse, child, or other dependent of a

participant, and

(II) is made pursuant to a 

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State domestic relations law (including a

community property law).

Defendants argue that the SAC alleges claims based on the orders

of the assignment and distribution of community property between

plaintiff and Ryskamp. In so arguing, defendants refer to

paragraphs 19, 21, 22, 24 and 25. 

Plaintiff opposes this aspect of the motion, contending that

neither Code of Civil Procedure § 337.5 or Family Code § 291

apply to the SAC because she seeks to enforce her rights under

ERISA as a participant and beneficiary in the Defendant Plans,

not under the QDRO or the August 11, 1994 Orders. Therefore, she

contends, this action is not “an action upon a judgment or decree

... of any state within the United States” nor is it an action

for “enforcement” of a “money judgment or a judgment for

possession or sale of property” subject to Family Code § 291 or

Code of Civil Procedure § 683.1. 

Plaintiff argues that the August 11, 1994 Orders did not

create her enforceable rights to benefits under the Defendant

Plans or their predecessors, noting that the SAC pleads that she

had vested interests in three of the plans. Therefore, she

contends, those vested interests arose by virtue of her

employment with Ryskamp Inc, in accordance with the plan terms

and are inalienable under ERISA. Plaintiff asserts:

The Dissolution Orders merely re-affirmed

that Ms. Hemphill had certain vested benefits

under the terms of the Defendant Plans and

their predecessors, and they could not

possibly serve to deprive Ms. Hemphill of

those benefits. Thus, Ms. Hemphill’s claim

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for benefits in this action is not an action

to enforce the Dissolution Orders or an

action brought pursuant to the Dissolution

Orders. Instead, it is a claim brought under

ERISA ... for enforcement and clarification

of rights to benefits ‘under the terms of the

[Defendant][P]lans’ and their predecessors

... The Dissolution Orders confirm the

existence of Ms. Hemphill’s vested rights to

benefits, but they are otherwise superfluous

to Ms. Hemphill’s claim for benefits.

With regard to the QDRO, plaintiff argues that it does not

provide a basis for her current claim for benefits under ERISA. 

Plaintiff contends that the domestic relations order does not

provide an enforceable basis for payment of benefits until it is

approved as a qualified domestic relations order by the plan

administrator. In so asserting, plaintiff cites Trustees of

Directors Guild of America v. Tise, 234 F.3d 415, 421 (9 Cir. th

2000), amended, 255 F.3d 661 (9 Cir. 2001): th

Under this scheme ..., whether an alternate

payee has an interest in a participant’s

pension plan is a matter decided by a state

court according to the state’s domestic

relations law. Whether a state court’s order

meets the statutory requirements to be a

QDRO, and therefore is enforceable against

the pension plan, is a matter determined in

the first instance by the pension plan

administrator, and, if necessary, by a court

of competent jurisdiction. See 29 U.S.C. §

1056(d)(3)(H)(i). 

It therefore follows ... that ‘[t]he QDRO

provisions of ERISA do not suggest that [the

alternate payee] has no interest in the

plan[] until she obtains a QDRO, they merely

prevent her from enforcing that interest

until the QDRO is obtained.’ ....

Tise further states that “under ERISA, the pension plan must pay

the bearer of a DRO if it determines that the order is a proper

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QDRO, without further inquiry; ‘[c]ompliance with a QDRO is

obligatory.’” 234 F.3d at 424. 29 U.S.C. § 1056(d)(3)(J)

provides that “[a] person who is an alternate payee under a

qualified domestic relations order shall be considered for

purposes of any provision of this chapter a beneficiary under the

plan.” Relying on this law, plaintiff argues that, because ERISA

gives beneficiaries and participants the right to bring a civil

action to recover benefits due and to enforce rights under the

terms of the plan, an action by an alternate payee designated by

a QDRO is an action brought under the terms of a plan, and not an

action to enforce any underlying state court domestic relations

order or judgment:

... The certification of the Proposed QDRO

obligated the Plan and its fiduciaries under

ERISA to distribute benefits to Ms. Hemphill,

who became a ‘beneficiary’ under the

Defendant Plans. Thus, Ms. Hemphill’s claim

for benefits arises under ERISA and the terms

of the Defendant Plans and rests on the

obligations of the Plan and its fiduciaries

under federal law to make good on its

certification and approval of the Proposed

QDRO as the Ryskamp QDRO. 

Plaintiff, noting that defendants cite no case law in support of

their position, refers to Jordan v. Jordan, 147 S.W.3rd 255

(Tenn.Ct.App. 2004). In Jordan, the defendant argued that his

ex-wife’s efforts to obtain a proposed QDRO more than ten years

after the entry of judgment in their divorce was barred by

Tennessee’s 10 year statute of limitations for actions to enforce

judgments. The court rejected the argument:

The plan administrator in the instant case

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has yet to approve the proposed QDRO. Hence,

the trial court’s decree cannot be enforced

against the ‘holder of the purse strings.’ 

Any attempt to ‘enforce’ the trial court’s

validly-entered division of Husband’s pension

plan would be futile. We conclude from all

of this that the approval of the proposed

QDRO is adjunct to the entry of the judgment

of divorce and not an attempt to ‘enforce’

the judgment. It is an essential act to

bring to fruition the trial court’s decree

regarding a division of Husband’s interest in

the DuPont pension plan. Until the proposed

QDRO is approved by the plan administrator

and entered by the trial court, the act of

the trial court in dividing the pension plan

is not complete and hence not enforceable. 

It can be accurately described as inchoate in

nature. It follows that Wife’s attempt to

obtain the approval of the plan administrator

of the proposed QDRO and the entry of that

order is not an action to enforce the divorce

judgment, and hence is not barred by the tenyear statute of limitations.

147 S.W.3rd at 262-263. Plaintiff, refers to the September 8,

1994 plan administrator’s approval of the QDRO, and argues that

she is now and has been for years a full-fledged participant and

beneficiary in the Defendant Plans. She contends that “[n]o

state law regarding the expiration of domestic relations orders

can deprive her of that status.” She further contends that, if

the plaintiff’s claims in Jordan were not time-barred, her claims

are not time-barred because she had “long since taken every

necessary action to perfect her interests in the benefits under

the Defendant Plans.” 

Plaintiff’s reliance on Jordan as supportive of her is

misplaced. Jordan does not support an inference that the state

statute of limitations to enforce a judgment does not apply if

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the QDRO had been obtained. Jordan is distinguishable and does

not support plaintiff’s position. 

Defendants reply that plaintiff’s opposition ignores the

allegations of the SAC. Defendants point to paragraphs 19 and 22

of the SAC, claims by plaintiff that she was entitled to the

assignment, transfer and vesting of four different benefits by

virtue of the QDRO and the August 11, 1994 Orders and that,

because of these orders, the interests were properly distributed

to her. Defendants contend:

In the [SAC] Plaintiff makes allegations to

attribute her claim to the interests in the

retirement funds to two orders from

California court that adjudicated the rights

of Plaintiff and Ryskamp to the funds. The

QDRO, according to the SAC, kept the three

smaller amounts vested in Plaintiff, when in

a marital dissolution those could have been

vested in Ryskamp. Marital dissolution

matters in California address the balancing

of the division of community property in a

dissolution and the clear implication of the

SAC is that these orders were intended to do

that.

Defendants further argue in support of the motion to dismiss:

... The basis of Plaintiff’s claims are that

the benefits were not distributed to her. 

The allegations of paragraph 19 state an

interest was created for her, assigned to her

and would be given only if she requested

them. The allegations of paragraph 22 state

the distributions would be made in a timely

manner. Her second amended complaint is that

she did not get them. Ever, according to her

allegations.

The definition of a QDRO in ERISA ... is that

it is a domestic relations order which

creates or recognizes marital property rights

of a former spouse, and is made pursuant to a

State domestic relations law. That meaning

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is one that Plaintiff studiously tries to

avoid in her opposition, though it certainly

did not keep her from making the allegations

of the SAC that the domestic orders were to

create her rights and result in

distributions. 

For the purpose of this motion, all the

allegations are to be treated as true. That

means ... according to the allegations, the

retirement funds were to become and be

Plaintiff’s by reason of the orders of the

dissolution of marriage court of California

and be distributed to her. According to the

allegations ..., starting in 1994 Plaintiff

tried and tried to have those funds disbursed

to her and treated in other ways as hers. 

She filed this suit ... more than 10 years

since the making of the orders and more than

10 years from the September 1994 date

Plaintiff’s allegations that the funds were

not disbursed to her and not treated as hers.

The allegations of Plaintiff’s Second Amended

Complaint are that as to a portion of the

claimed funds, those funds were vested in her

as part of the domestic relations order. As

to the $50,000 portion, she alleges that was

to be transferred to her. The orders could

have vested all of them to Ryskamp and she

alleges they did not. The alleged orders are

the basis of Plaintiff’s claim of the funds. 

It not, there would be no explanation for her

to be claiming the funds. If the funds were

not transferred to her, she had no claims

concerning all the matters she states. The

allegations ... are that the funds were to be

transferred to Plaintiff pursuant to the

orders and she is suing because they have not

been transferred to her from as early as her

first alleged request in September 1994. 

Defendants further contend that, contrary to plaintiff’s

arguments that she is seeking to enforce her rights under ERISA

as a participant and beneficiary, reading the allegations in

paragraphs 24-29 and 35 of the SAC, plaintiff was never treated

as a vested participant and never was treated as a beneficiary. 

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Again, referring to the definition of a QDRO in Section

1056(d)(3)(B)(i)(I) “which creates or recognizes the existence of

an alternate payee’s rights to, or assigns to an alternate payee 

the right to, receive all or a portion of the benefits payable

with respect to a participant under a plan”, defendants argue

that nothing in the SAC indicates anything was created or

received and complains that plaintiff “spends pages and pages

alleging in the SAC that Defendants never recognized Plaintiff’s

rights and Plaintiff never received all or a portion of the funds

under either what she describes as the QDRO and the August 11,

1994 Orders.”

The SAC alleges violations of ERISA. Although the SAC

raises ambiguity whether claims for relief are stated under

ERISA, defendants do not move for dismissal on the ground that

plaintiff is not entitled to relief under ERISA if the claims are

timely. Defendants argue that plaintiff will have to prove the

fact of the QDRO and the August 11, 1994 Orders before obtaining

relief. However, the fact that plaintiff will have to prove the

existence and content of these orders in order to obtain relief

under ERISA does not convert this action into one to enforce a

judgment. Secondly, there are limitations periods applicable to

claims under ERISA which govern the timeliness of the claims for

relief alleged in the SAC. 

Plaintiff further argues that ERISA preempts any application

of the California statutes relied upon by defendants, an argument

totally ignored by defendants in their reply brief. In so

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arguing, plaintiff notes that 29 U.S.C. § 1056(d)(1) requires

that “[e]ach pension plan shall provide that benefits provided

under the plan may not be assigned or alienated.” Plaintiff

argues that defendants’ arguments 

arguments regarding expiration of the

Proposed QDRO and the Dissolution Orders lead

to the preposterous, inequitable outcome that

vested benefits that were acknowledged and

approved by Dr. Ryskamp as Plan Administrator

and to which Ms. Hemphill was entitled were

alienated within ten years of the Ryskamp

QDRO and the Dissolution Orders simply by

operation of California state law. ERISA’s

preemption and anti-alienation provisions

prohibit such an absurd result.

29 U.S.C. § 1144(a) provides in pertinent part that “the

provisions of this subchapter and subchapter III of this chapter

shall supersede any and all State laws insofar as they may now or

hereafter relate to any employee benefit plan described in

section 1003(a) of this title and not exempt under section

1003(b) of this title.” 

The starting point for determining whether ERISA preempts a

state law is Section 1144(a). The Supreme Court has emphasized

the broad effect of Section 1144(a). See California Division of

Labor Standards v. Dillingham, 519 U.S. 316, 324 (1997)(quoting

prior cases using the phrases “clearly expansive”, “broad scope”,

“expansive sweep”, “broadly worded”, “deliberately expansive”,

and “conspicuous for its breadth”.). The Supreme Court has

stated that “[a] law ‘relates to’ an employee benefit plan, in

the normal sense of the phrase, if it has a connection with or

reference to such a plan.” Ingersoll-Rand Co. v. McClendon, 498

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U.S. 133, 139 (1990). “Where a State’s law acts immediately and

exclusively upon ERISA plans ... or where the existence of ERISA

plans is essential to the law’s operation ... that ‘reference’

will result in preemption.” Dillingham, 519 U.S. at 325. With

regard to the phrase “connection with”, the Supreme Court holds:

“[T]o determine whether a state law has the forbidden connection,

we look both to ‘the objectives of the ERISA statute as a guide

to the scope of the state law that Congress understood would

survive,’ as well as to the nature of the effect of the state law

on ERISA plans.” Dillingham, id. In analyzing these objectives

“[t]he basic thrust of the pre-emption clause [is] to avoid a

multiplicity of regulation in order to permit the nationally

uniform administration of employee benefit plans.” New York

State Conference of Blue Cross & Blue Shield Plans v. Travelers

Ins. Co., 514 U.S. 645, 657 (1995). The Supreme Court has also

emphasized that “[t]he principal object of the [ERISA] statute is

to protect plan participants and beneficiaries.” Boggs v. Boggs,

520 U.S. 833, 845 (1997). However, the Supreme Court has

established a presumption that Congress did not intend ERISA to

preempt areas of “traditional state regulation” that are “quite

remote from the areas with which ERISA is expressly concerned -

‘reporting, disclosure, fiduciary responsibility, and the like.’” 

Dillingham, 519 U.S. at 330. 

Relying on these pronouncements, plaintiff argues that

California Family Code § 291 and California Code of Civil

Procedure §§ 683.020 and 337.5 are preempted by ERISA because, if

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applied to ERISA plans, they would undermine the ERISA statute

and Congressional intent behind ERISA:

Defendants argue that these California

statutes render QDROs stale if the benefits

described in the orders are not distributed

within ten years. Defendants further argue

that benefits that are described in a court

order, and that are benefits to which a

participant in an employee benefit plan has a

vested interest, cease to exist after ten

years following the entry of the order, by

operation of these California statutes. 

ERISA ... contains no such limitation on the

duration of a QDRO, and neither the Ryskamp

QDRO nor the Dissolution Orders contain any

sort of time limit for Ms. Hemphill to take a

distribution of benefits. Moreover,

Defendants’ arguments overlook the goal and

intent of ERISA - protection of the rights of

participants and beneficiaries in employee

benefit plans, including their right to

vested benefits ....

Citing Boggs v. Boggs, supra, 520 U.S. at 851, that “[s]tatutory

anti-alienation provisions are potent mechanisms to prevent the

dissipation of funds” and “can ‘be seen to bespeak a pension law

protective policy of special intensity: Retirement funds shall

remain inviolate until retirement’”, plaintiff contends that her

vested rights that arose because of her participation in the

Defendant Plans are inalienable and continue until she receives a

distribution. She asserts: “Where state law interferes with this

unassailable right under ERISA, ERISA preempts such state law.” 

There is an additional purpose of ERISA that would be thwarted by

the state laws: ERISA permits participants to hold tax deferred

investment interests in qualified plans for the time periods

defined by plan provisions. Requiring enforcement and

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distribution of a participant’s ERISA plan interest according to

state law would conflict with and defeat ERISA’s statute of

limitations and individual plan terms.

Plaintiff makes a similar argument with respect to her

rights as an alternate payee under the QDRO. She notes that,

under ERISA, a plan administrator is bound by the terms of a QDRO

and is bound to distribute benefits in accordance with its terms. 

Tise, supra, 234 F.3d at 424. She further notes that “ERISA

assigns to plan administrators the fiduciary duty to ensure that

an alternate payee’s rights are protected.” Stewart v. Thorpe

Holding Co. Profit Sharing Plan, 207 F.3d 1143, 1156 (9 Cir. th

2000), cert. denied, 531 U.S. 1074 (2001). Congress intended

ERISA’s QDRO provisions to give protection to the spouse and

dependent children in the event of a divorce. See Tise, supra,

234 F.3d at 425. Plaintiff argues:

In light of the purpose of ERISA to protect

the right to benefits of participants and

beneficiaries, Defendants’ efforts to impose

a ten-year state limitations period on

actions to enforce rights described in a QDRO

and other divorce-related orders lead to

results antithetical to ERISA: the

deprivation of Ms. Hemphill of her share of

the pension benefits which accrued during her

marriage to Ryskamp and the dissipation into

thin air of Ms. Hemphill’s vested benefits

that had accrued during her employment with

Ryskamp Inc. ERISA pension plans provide for

retirement benefits; neither the Dissolution

Orders nor the Ryskamp QDRO created any

obligation for Ms. Hemphill to claim her

benefits immediately. ERISA does not permit

the forfeiture of Ms. Hemphill’s benefits

simply because she did not take an immediate

rollover distribution of those benefits. Any

state law that leads to such an absurd result

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would clearly be directly antithetical to,

and therefore preempted by, ERISA.

Defendants’ failure to respond to the preemption argument

implies that defendants do not have authority that supports a

contrary position. The SAC alleges claims for relief under

ERISA. Plaintiff is either entitled to relief under ERISA or she

is not, an issue that is not raised in the motion to dismiss. 

Plaintiff’s ERISA claims alleged in the SAC are subject to ERISA 

statutes of limitations applicable to those claims. 

2. 29 U.S.C. § 1113.

Alternatively, defendants move to dismiss the action as

barred by the statute of limitations set forth in 29 U.S.C. §

1113:

No action may be commenced under this

subchapter with respect to a fiduciary’s

breach of any responsibility, duty, or

obligation under this part, or with respect

to a violation of this part, after the

earlier of -

(1) six years after (A) the date of

the last action which constituted a

part of the breach or violation or

(B) in the case of an omission, the

latest date on which the fiduciary

could have cured the breach or

violation, or

(2) three years after the earliest

date on which the plaintiff had

actual knowledge of the breach or

violation;

except that in the case of fraud or

concealment, such action may be commenced not

later than six years after the date of

discovery of such breach or violation.

Defendants, noting that paragraphs 24 and 25 allege that

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plaintiff requested her benefits in September 1994 and in mid1996, argue:

Though paragraphs 24 and 25 of the SAC do not

expressly state she knew the benefits had not

been given to her, paragraph 25 must be read

as an acknowledgment that Plaintiff knew her

1994 request was refused since she asked for

them again in 1996. In paragraph 27 ...

Plaintiff allegedly again requested her

benefits in August 2003, which indicates she

knew that she had been refused when she

requested them in 1994 and 1996. 

Therefore, defendants argue, this action should have been filed

within three years of the denial in 1994.

Plaintiff responds that the limitation period set forth in

Section 1113 does not apply to all of the claims alleged in the

SAC but only to the Third Claim for Relief. 

a. First and Second Claims for Relief.

With regard to the claim for recovery of benefits and

related claim for declaratory relief, plaintiff points out that,

because there is no specific federal statute of limitations

governing claims for benefits under an ERISA plan, the Ninth

Circuit holds that California’s four-year statute of limitations

for suits on written contract (CCP § 337) applies to an ERISA

cause of action based on a claim for benefits under a written

contractual policy. Wetzel v. Lou Ehlers Cadillac, 222 F.3d 643,

646-648 (9 Cir. 2000). th

Plaintiff further opposes the motion to dismiss the claim

for recovery of benefits and the related claim for declaratory

relief under the four-year statute of limitations on the ground

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that this limitation period “has never even begun to run”. In so

arguing, plaintiff refers to Martin v. Construction Laborer’s

Pension Trust, 947 F.2d 1381, 1384 (9 Cir. 1991), wherein the th

Ninth Circuit held:

Although the analogous state statute of

limitations establishes the time period

within which suit must be brought, federal

law determines the time at which the cause of

action accrues ... A suit to enforce rights

under a pension plan accrues, and the statute

of limitations begins to run, when there has

been a clear and continuing repudiation of

rights under the pension plan which is made

known to the beneficiary.

Plaintiff argues the allegations of the SAC demonstrate that the

Defendant Plans have never provided a clear denial of her claim

for benefits, despite the plan fiduciaries’ failures to respond

to plaintiff’s requests for distribution and information

regarding her benefits in 1996, 2002 and 2003. She further

points out that the SAC alleges that the Defendant Plans were

willing to distribute some amount of benefits to plaintiff in

November 2004 when the TPA sent plaintiff benefit distribution

election forms for the $50,000 amount owed to plaintiff as the

alternate payee under the QDRO. Plaintiff did receive a clear

and continuing repudiation of her right to benefits under the

four plans. 

Defendants respond that plaintiff’s rights arising from the

plans were clearly and continuously rejected by them when the

plans did not distribute the funds to her in 1994, 1996, 2002 and

2003. However, defendants continuously failed to respond to

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requests and did not repudiate plaintiff’s rights in the plans,

except as to the $50,000 interest which defendants acknowledged

and represented they would honor. 

Even if, arguendo, the allegations of the SAC may be

construed to infer a clear and continuing repudiation of

plaintiff’s rights under the plans, plaintiff argues that the

running of the four-year statute of limitations was equitably

tolled by defendants’ failure to provide information to plaintiff

regarding her rights under the Defendant Plans, the amount and

location of her benefits, the identity of and contact information

for the plan administrative committee, and the plans themselves. 

In so arguing, plaintiff refers to Santa Maria v. Pacific Bell,

202 F.3d 1170, 1178 (9 Cir. 2000): th

Equitable tolling may be applied if, despite

all due diligence, a plaintiff is unable to

obtain vital information bearing on the

existence of his claim ... Unlike equitable

estoppel, equitable tolling does not depend

on any wrongful conduct by the defendant to

prevent the plaintiff from suing. Instead it

focuses on whether there was excusable delay

by the plaintiff. If a reasonable plaintiff

would not have known of the existence of a

possible claim within the limitations period,

then equitable tolling will serve to extend

the statute of limitations for filing suit

until the plaintiff can gather what

information he needs ... However, equitable

tolling does not postpone the statute of

limitations until the existence of a claim is

a virtual certainty.

Plaintiff also refers to Veltri v. Building Service 32B-J Pension

Fund, 393 F.3d 318 (2 Cir. 2004). In Veltri, the Second nd

Circuit discussed equitable tolling in the context of the failure

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of defendants to comply with federal regulations requiring

defendants to provide Veltri with notice of his right to file an

administrative appeal of his adverse benefits determination and

of the right to file an action challenging that determination in

court. 393 F.3d at 323. The Second Circuit, after a discussion

of accrual of the claim, stated in pertinent part:

... In applying equitable tolling based on

defendants’ concealing conduct, the question

of whether defendant’s concealment also

prevents accrual of the cause of action so

that the statute is not actually tolled, but

rather, never begins to run, is an

unnecessary exercise insofar as our

resolution of it would have no effect on the

result ... Because we hold equitable tolling

appropriate where defendants fail to comply

with the regulatory requirement that they

provide notice to beneficiaries of the right

to bring an action in court challenging a

denial of benefits, we need not resolve

precisely when the underlying cause of action

accrues. ...

We share the Fund’s concern that to allow

tolling of the statute of limitations ‘in

perpetuity,’ would thwart actuarial

prediction of plan liability and thereby

threaten the ability of pension plans to

prepare in advance to meet financial

obligations simultaneously to both

beneficiaries and adverse litigants. 

Equitable tolling is an extraordinary remedy

because if applied too liberally it threatens

to undermine the purpose of statutes of

limitations of allowing potential defendants

predictability and ultimate repose. However,

it must be borne in mind that our holding is

grounded in equitable principles. We are not

establishing a simple mechanical rule that

failure to notify a claimant of her right to

bring an action in court automatically tolls

the statute of limitations. Thus, for

example, a plaintiff who has actual knowledge

of the right to bring a judicial action

challenging the denial of her benefits may

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not rely on equitable tolling notwithstanding

inadequate notice from her pension plan ....

Similarly, the equitable defenses of laches

and estoppel remain available to defendants

seeking to avoid unfair surprise from the

filing of untimely claims by plaintiffs who

seek to rely on equitable tolling on the

basis of defective notice ....

393 F.3d at 325-326.

Relying on these cases, plaintiff argues that “Dr. Ryskamp,

the Defendant Plans and their predecessors, and their agents have

given Ms. Hemphill the classic ‘run around” for several years in

response to her inquiries for information and documents.” She

refers to the allegations in the SAC she never received a summary

plan description for any of the Defendant Plans since 1994 until

April 29, 2005 when Dr. Ryskamp’s attorney provided a summary

plan description for only one of the plans. She refers to the

allegations in the SAC that she never received individual account

statements showing the amount of her benefits until April 29,

2005 when account statements for the years 1994 to 1999 were

provided for the Ryskamp-Takayama Plan. She refers to the

allegations that the TPA informed plaintiff to make her inquiries

to the plan administrative committees but did not inform her how

they could be reached. She refers to the allegations that the

TPA told her in 2002 that she could not obtain a distribution of

benefits until Dr. Ryskamp filed tax forms for that year and she

refers to the allegations that Dr. Ryskamp failed to respond to

her inquiries in 1996, 2003, and 2005. Plaintiff contends:

As a result of the failures of the Defendant

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Plans and their fiduciaries to provide Ms.

Hemphill with information regarding her

benefits and regarding the plans themselves,

Ms. Hemphill had (and continues to have)

virtually no idea how her benefits were being

handled, how to obtain a distribution of her

benefits, or how to make a claim under any of

the plans’ internal claims and appeals

procedures required under ERISA § 503. See

29 U.S.C. § 1133; 29 C.F.R. § 2560.503-1. At

no point did she receive a written denial of

her requests for distribution of benefits or

any notice of her rights to bring an action

in court - which are required by federal

regulations .... [Emphasis added]

Defendants reply that plaintiff’s assertion of equitable

tolling: 

is not supported by any allegation in the SAC

showing that some how, some way, Plaintiff

could allege that the failure to make the

requested distributions, alleged to be

obliged by the domestic relations orders, was

concealed from her. Given all the

allegations by Plaintiff of seemingly endless

allegations of failures by Defendants, it is

clear how she now does not claim she in some

way was prevented from knowing her endlessly

alleged requests were clearly and

continuously rejected. In the absence of

such facts, the argument about equitable

tolling is meaningless. All the cases cited

by Plaintiff rely on conduct by a defendant

which prevents the plaintiff from realizing

her requests for distribution of the fund

were not honored.

Grounds for equitable tolling are alleged based on the nonresponsiveness of defendants and the alleged failures to provide

statutorily required notices of financial information. At the

pleading stage, equitable tolling is viable. 

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b. Third Claim for Relief.

Plaintiff further argues that the Third Claim for Relief for

breach of fiduciary duty is not time-barred by Section 1113.

Section 1113 provides that a claim for breach of fiduciary

duty must be brought within: “(1) six years after (A) the date of

the last action which constituted a part of the breach ...” or

“(2) three years after the earliest date on which the plaintiff

had actual knowledge of the breach or violation”, whichever is

earlier. 

In so arguing that the Third Claim for Relief is not timebarred, plaintiff refers to Ziegler v. Connecticut General Life

Insurance Company, 916 F.2d 548, 552 (9 Cir. 1990): th

The second step of analysis under the ERISA

statute of limitations directs us to inquire

when Westco had ‘actual knowledge’ of the

alleged breach or violation ... This inquiry

into plaintiff’s actual knowledge is entirely

factual, requiring examination of the record. 

Identifying the breach may end the analysis

in cases where the breach coincides with an

ERISA plaintiff’s actual knowledge of the

breach ... We stress that an ERISA

plaintiff’s cause of action cannot accrue and

the statute of limitations cannot begin to

run until the plaintiff has actual knowledge

of the breach, regardless of when the breach

actually occurred. The ERISA statute of

limitations, 29 U.S.C. § 1113, requires

satisfaction of this second prerequisite, the

plaintiff’s actual knowledge of the breach,

before the statute can begin to run.

Plaintiff also refers to Frommert v. Conkright, 433 F.3d 254, 272

(2 Cir. 2006), quoting Caputo v. Pfizer, Inc., 267 F.3d 181, nd

193 (2 Cir. 2001): nd

“‘[A] plaintiff has “actual knowledge of the

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breach or violation” within the meaning of

... § 1113(2), when he has knowledge of all

material facts necessary to understand that

an ERISA fiduciary has breached his or her

duty or otherwise violated the Act.’ ...

Thus, ... ‘it is not enough that [plaintiffs]

had notice that something was awry;

[plaintiffs] must have had specific knowledge

of the actual breach of duty upon which [they

sued].’ 

Plaintiff’s reliance on Frommert and Caputo appears to be

misplaced. In Barker v. American Mobil Power Corp., 64 F.3d 1397

(9 Cir. 1995), the Ninth Circuit cited Radiology Ctr., S.C. v. th

Stifel, Nicolaus & Co., 919 F.2d 1216, 1220 (7 Cir. 1990) with th

approval as holding that the “‘fraud or concealment’ exception

[in Section 1113] applies only when an ERISA fiduciary either

‘misrepresent[s] the significance of facts the beneficiary is

aware of (fraud) or ... hid[es] facts so that the beneficiary

never becomes aware of them (concealment).’” In Caputo, the

Second Circuit cited Barker and other circuit decisions and

“decline[d] to follow our sister circuits in fusing the phrase

‘fraud or concealment’ into the single term “fraudulent

concealment.’” Ninth Circuit authority is controlling in

resolving this section of the motion to dismiss. 

Plaintiff argues that the Third Claim for Relief is not

time-barred:

Dr. Ryskamp and Ryskamp Inc. breached their

fiduciary duties by, among other things,

failing to provide Ms. Hemphill with plan

information, plan documents, an accounting of

her benefits, and all of the rights and

privileges afforded to participants and

beneficiaries of the Defendant Plans and

their predecessors; diverting plan assets in

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29 U.S.C. § 1132(c) provides in pertinent part: 1

(1) Any administrator ... (B) who fails or

refuses to comply with a request for any

35

violation of ERISA; and by engaging in

speculative, risky investments ... These

breaches, some of which may have begun in the

1990s but which have continued to the

present, are within ERISA § 413's six year

limitation period, as the SAC alleges actions

in violation of Defendants’ fiduciary duties

that occurred within six years of

commencement of this action and the breaches

have continued to the present.

Moreover, Ms. Hemphill’s claims are subject

to the ‘fraud or concealment’ prong of ERISA

§ 413, because Dr. Ryskamp’s withholding of

information from Ms. Hemphill rendered it

impossible for her to discover the breaches

of fiduciary duty that Ms. Hemphill has

alleged in the SAC: the diversion of plan

assets, the investment of plan assets in

speculative, risky investments, and the

failure to properly manage and account for

the assets of the Defendant Plans ... Thus,

the statute of limitations for the breach of

fiduciary duty claim was tolled until Ms.

Hemphill discovered these breaches after

filing this action and obtaining documents

from the TPA in early 2006.

Dismissal of this claim pursuant to Rule 12(b)(6) as timebarred is not appropriate as a matter of law based on defendants’

alleged withholding of information, their failures to respond and

to provide statutory notices of available remedies. 

c. Fourth Claim for Relief.

With regard to the Fourth Claim for Relief, plaintiff notes

that the Ninth Circuit applies California’s three-year statute of

limitation set forth in CCP § 338(a) to claims for nondisclosure

penalties pursuant to 29 U.S.C. § 1132(c). Stone v. Travelers 1

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information which such administrator is

required by this subchapter to furnish to a

participant or beneficiary (unless such

failure or refusal results from matters

reasonably beyond the control of the

administrator) by mailing the material

requested to the last known address of the

requesting participant or beneficiary within

30 days after such request may in the court’s

discretion be personally liable to such

participant or beneficiary in the amount of up

to $100 a day from the date of such failure or

refusal and the court may in its discretion

order such other relief as it deems proper.

For purposes of this paragraph, each violation

... described in subparagraph (B) with respect

to any single participant or beneficiary,

shall be treated as a separate violation.

36

Corp., 58 F.3d 434, 439 (9 Cir. 1995). Plaintiff contends that th

this claim is not time-barred by the three-year statute of

limitations because she made requests for an accounting and other

information and documents required by ERISA on August 4, 2003,

February 3, 2005 and March 29, 2005, all of which currently

remain outstanding. These requests are not time-barred. Claims

under Section 1132(c) prior to October 18, 2002 are potentially

time-barred, absent tolling.

d. Fifth Claim for Relief. 

Plaintiff argues that the Fifth Claim for Relief is not

time-barred. Plaintiff notes that the Fifth Claim for Relief

seeks, among other things, to impose a constructive trust on the

benefits allegedly being wrongfully withheld or retained by the

defendants. Contending that there is no statute of limitations

for this type of claim found in ERISA, plaintiff argues that the

court must look to the most analogous state statute of

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limitations, see Wetzel, supra, 222 F.3d at 646. Citing Nelson

v. Nevel, 154 Cal.App.3d 132 (1984), plaintiff contends that the

Fifth Claim for Relief is subject to the four-year statute of

limitations set forth in CCP § 343 applicable to claim in equity.

Although defendants do not reply to plaintiff’s specific

arguments concerning the applicable statute of limitations to be

applied to the Fifth Cause of Action, plaintiff’s reliance on

Nelson v. Nevel to impose a four-year statute of limitations does

not appear to be well-taken. Arguably, the Fifth Claim for

Relief is governed by the three-year statute of limitations set

forth in CCP § 338(4).

Nelson v. Nevel involved an action brought by a woman

against a man seeking to obtain her share of real property

acquired by the parties while they were living together, which

property was held in the man’s name. The Court of Appeals ruled

in pertinent part:

‘An action based strictly in equity, as where

plaintiff claims an interest in property

standing in the defendant’s name and acquired

during the period of cohabitation and seeks

to impose a ... constructive trust, must be

brought within four years.’ ... ‘[S]ection

343 of the Code of Civil Procedure providing

a four-year statute of limitations applies in

“all suits in equity not strictly of

concurrent cognizance in law and equity.”’

....

Respondent argues that appellant’s cause of

action arises from an implied contract and,

therefore, all equitable remedies are merely

ancillary to a breach of contract action. We

do not agree ... Significantly, respondent

himself cites cases which hold that the

nature of the right claimed, not the form of

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the action, determines the applicability of

the statute of limitations ... ‘Neither the

caption, form, nor prayer of the complaint

will be deemed conclusive in determining the

nature of the liability from which the cause

of action flows. On the contrary, the true

nature of the action will be ascertained from

the basis facts a posteriori.’ ... Although

it may have been possible for appellant to

set forth facts constituting a cause of

action for breach of an implied contract

between respondent and herself, she did not

do so. Her cause of action sounded in

equity.

Respondent’s argument that the three-year

period of Code of Civil Procedure section

338, subdivision 4, necessarily governs

appellant’s action is also without merit. 

Appellant did not, and need not, allege that

respondent breached a duty owed to her based

on a confidential or fiduciary relationship. 

As respondent points out, such allegations

constitute an action for constructive fraud

... Respondent relied on Day v. Greene[, 59

Cal.2d 404 (1963)] which holds that where

constructive fraud is the gravamen of an

action the three-year limitation period

prescribed in Code of Civil Procedure section

338, subdivision 4, is applicable ...

However, the reasoning of that case is

relevant only when the action is based on

violation of a confidential relationship or a

breach of trust ... Day v. Greene does not

apply to actions based strictly in equity ...

Therefore, appellant can simply claim an

equitable interest in the property which now

stands solely in respondent’s name and ask

the court to impose a constructive trust ...

The four-year limitation period of Code of

Civil Procedure section 343, which applies to

such equitable action, does not bar

appellant’s action.

154 Cal.App.3d at 140-141. 

Here, the allegations of the SAC are based on violations an

ERISA trust and of fiduciary duties arising under ERISA. The

Fifth Claim for Relief seeks to impose a constructive trust based

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In O’Connor, the Ninth Circuit noted that California’s 2

“discovery rule” provides that a plaintiff discovers a claim when

the plaintiff “suspects or should suspect that her injury was

caused by wrongdoing.” 311 F.3d at 1147. Because application of

California’s discovery rule would result in an earlier commencement

date for the limitations period, the Ninth Circuit ruled that the

federal discovery rule under 42 U.S.C. § 9658 preempts the

California rule.

39

on those violations. Consequently, it appears that the threeyear statute of limitations should apply to the Fifth Claim for

Relief. 

Plaintiff further argues that the Fifth Claim for Relief is

not time-barred. Noting that accrual of a claim for relief under

ERISA is determined by federal law, Martin v. Construction

Laborer’s Pension Trust, supra, 947 F.2d at 1384, plaintiff

argues that federal law recognizes a “discovery rule”. Plaintiff

cites O’Connor v. Boeing North American, Inc., 311 F.3d 1139,

1147 (9 Cir. 2002), a case involving CERCLA. In O’Connor, the th

Ninth Circuit explained:2

[T]he discovery rule provides that a

limitation period does not commence until a

plaintiff discovers, or reasonably could have

discovered, his claim ... Because ‘[t]he

plaintiff must be diligent in discovering the

critical facts’ a plaintiff who did not

actually know of his claim will be barred ‘if

he should have known [of it] in the exercise

of due diligence.’ ... A plaintiff is ‘held

to her actual knowledge as well as knowledge

that could reasonably be discovered through

investigation of sources open to her.’ ...

This concept of constructive notice is

captured by the maxim that ‘the means of

knowledge are the same thing in effect as

knowledge itself.’ ....

In requiring actual or constructive knowledge

of the cause of an injury before Plaintiffs

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can be deemed to be on notice of their claims

..., [a] plaintiff knows or reasonably should

know of a claim when he or she knows ‘both in

existence and the cause of his injury.’ ....

311 F.3d at 1147. 

Plaintiff argues that the Fifth Claim for Relief is not

time-barred because of the “rule of discovery”, because she “only

learned in early 2006, after reviewing documents that were

obtained from Defendant Plan’s former TPA during the course of

this lawsuit, that assets of the Defendant Plans, including

benefits to which Ms. Hemphill was entitled, may have been

distributed or diverted to Ryskamp Inc., Mrs. Ryskamp, the

Ryskamp Estate, and/or the Ryskamp Trust.” At that time,

plaintiff asserts, she filed the SAC including these allegations. 

Plaintiff further argues:

Until that time, because of the dearth of

information Ms. Hemphill was able to obtain

about the Defendant Plans and their

predecessors and her benefits, Ms. Hemphill

could not have reasonably discovered any

basis for her claim for equitable and

injunctive relief, regardless of when plan

assets were distributed or wrongfully

diverted.

The Fifth Claim for Relief is not time-barred as a matter of

law based on the allegations on the face of the SAC.

ACCORDINGLY:

1. Defendants’ motion to dismiss the Second Amended

Complaint is denied.IT IS SO ORDERED.

Dated: July 5, 2006 /s/ Oliver W. Wanger 

emm0d6 UNITED STATES DISTRICT JUDGE

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