Ofthe So uthe rnDis t ri c tofI ndi ana, s i t t i ng by des i gna t i on. ^ 

## In the 

# U n ited S ta tes Co urt o f Ap p ea ls

F o rth eS e v e n th C ir cu it
N o. 10

- 2887 N EW P AGE W I S CONS I N S Y S T E M I NC . a nd N PW SI R ETI RE E H EA LT H P LA N, P laint if fs -App el lants , v. U NI T ED S TEE L, P AP ER & F O RESTRY, R UBBER, M ANU FA CT UR I NG, E NE RGY A LLI ED I NDUS T R I AL AN D S ERVICE W O RKERS I NTERNATI ONA L U NI ON, AF L– CI O/ CLC , e tal ., D efend a nts-A pp ellees
.
A pp eal from the United S t ates Di strictC our t fo r the Western Di stricto f Wisc onsin
. No . 10 -cv-41-bbc

—Barb ara B. C rab b , Ju dge .
A RG UE D A PRI L 5, 2011

— D ECI DE D J UL Y 12, 2011

Befo re E A S T E RB R OO K, Chi e f Judg e, B AUER, Cir cu i tJudg e, a nd Y OUNG, D i s t r i ctJudg e . ^ E A S TERB R OO K, Chi e

f Judg e . New Page W i sco nsi n Sy ste m I nc. o perat es paper m i l l s in W isc on si n. I t pr ovi des2 N o. 10

- 2887 heal th car e a s a fringe ben efit forcurr ent a nd f or m er w or ker s. I ts Reti re e Heal th Pl an i s g ove rned bya seri es ofco l l ecti ve bar gaini ng ag re em ents between N ew Page W i sc o ns i n a nd the U ni te d S te elW o r k er s Uni o n. ( The agr eem ents w er e m ade bypre decesso rs of both N ew Page W i sc o ns i n an d th e Uni o n, but we us e th e cur r en t n am es for s im p licit y.) N ew P ag e W isc on sin rec en tly cl o se d s everal mil l s as a c o st
- sa vingmeas ur e. S ee k i ng furthersa vi ngs, i t e l i m i nated t h e subsi dy f orm edi cal care of reti rees w ho are 65 or older. Asse r tingthat thi s ch an g e vi o l at ed bo ththe CBA and th e R et ire e H ea lth P lan , th e U n ion filed su it in Dec embe r2 009 un der§ 30 1 o fthe Labo rM an ag ement R el at i o ns Act( LM RA), 2 9 U. S
. C. § 18 5, a nd § 50 2 o fthe Em plo yee Reti re m ent I ncom e Se curi ty A ct ( ER I SA ), 2 9 U .S.C . § 1 1 3 2 . T h at su it is n otth e s u bj ec t o f th is a p p ea l, how eve r, bec ause i t was fi l ed i n th e So uthern Dist ri ct ofOhio

. Fiv e w eek s a fterthe U ni on fi l ed i ts sui t in Ohio , N ew Page W i sco nsi n fi l ed a declarator y-j ud gm ent a cti on inth e W e st er n D ist ric t o f W isc on sin . Th is s u it r ai se s th e sa m e su bs ta nt i ve i ss ue s as the Uni o n’ s but di d no t l as t l o ng: the di st r i ctc o ur t di smi ss ed i t o n the p lea d in gs . 201 0 U .S. D ist . L EXIS71 511 ( W
. D. W is. J uly16 , 2010 )
. T h e courthel d that i t di d not hav e s ubj ectm att erj uri sdic ti on o verthe ER I SA cl ai m bec ause §5 02 (a)( 3) d oe s n o t a u t h or ize relie f w h en “p lan ad m in istr ato rs . . . se ek decl ar ati on o fthei r ri ght t o re d u ce o r den y b en efi ts. ” Id. at * 22. The co urt concl ud ed that i t had j uri sdic ti on o verthe L M R A cla i m but exer ci sed i ts dis-N o. 10

- 2887 3

cre ti on t o dism i ss i n f avo r ofthe U n ion ’s sui t in Ohio

. Id. a t* 2 8

– 2 9
. Ne wPa g e Wi s c o ns i n’ s a pp e a lc ha l l e ng es bo tha spe ct s o fthe di st r i ctc o ur t’ s dec i si o n. Decl ar ato ryj ud gm ent a cti ons ar e a uthor i zed, se e 2 8 U
. S. C. §220 1, as l ong as ther e i s a n actualco n tr ov er sy b et w ee n th e t w o p ar tie s . M e dIm m une, Inc . v. Ge ne nt e ch, Inc. , 549 U .S . 1 1 8 , 127 (2007). Yet §2 201 i s no t a gr ant o f su bj ec t-m at te r j u ris d ict ion, so th e d ist ric t c ou rtp ro p er ly l oo k e d t o the s ub s t a nt i v e c l a i ms t o de t e r mi ne wh e ther it h ad j u ris d ict ion
. Fra nc hi s eTax Boar d v
. Cons t r uc t i on La bo rers Va ca tio n Trust, 46 3 U .S. 1 (19 83 ); Ame ri te ch Ben e f i tPla n Com m i t t e ev. Com m uni ca t i on Worke rs of A m er ica , 220 F.3d 814 , 818 (7th C ir. 2000). Se cti on 5 02( a) ( 3) o fERIS A st ate s that a ci vi lact i on m ay b e b r o u gh t “ b y a p ar tic ip an t, be n efic iar y, or fid u c iar y . . . to obt ain ap propri ate equi tabl e r el i ef” o r to enf or ce an y t er m s o f th e p lan . A lth ou gh N ew P ag e W isc on sin i s a fi du c i a r y a nd c a n the r e f o r e r e qu e s t“ a pp r o pr i ate eq u ita b l e r elie f” fro m a d ist ric t c ou rt, relief p ro p er ly cal l ed “l ega l ” r atherthan “equi tabl e” i s no t co ver ed by §502 ( a) ( 3)

— and not a l lequi tabl e r el i efis “appropri ate ” i n a g i ven s uit
. S ee CIGNA Corp
. v. A m a ra , 1 31 S. Ct. 18 66 (20 11 ); Sereb off v. M id Atlanti c M ed ic al Se rvic es, Inc. , 54 7 U
. S. 356 (2006); Gr e at

- We s tLi f e& Annu i ty Ins uranc eCo. v. Knuds on , 534 U .S. 20 4 (2 00 2); M ertens v . Hew itt A ssoc ia tes , 508 U
. S. 248 (1993). N ew Page W i sco nsi n w ants the di str i ct c ourtto decl ar e t h at the changes i t m ade to the Reti re e Heal th Pl ana r e co ns i st entwi thi ts l eg alo bl i g at i o ns . Lo o k i ng at N ew Pa ge W iscons in’s com p lai nt, w e c an not i d en tify4 N o. 10

- 2887

an y re q u es t fo r “a p p ro p ria te eq u ita b le re lief” th at w ou ld bring i ts cl ai m withi n §50 2( a) ( 3)
. The co m pla i nt nei ther re q u es ts eq u i t a b l e relie f n or as ks th e c ou rtfor h elp in enf or ci ng the Pl an. S ee M as s ey F e rgus on D i vi s i on of V a rity C o rp. v. G urley, 5 1 F
. 3 d 1 0 2 , 1 0 3 ( 7 th Ci r . 19 95) (dictu m ); Tr ans am e r ica O cc i de nt al Li f eIns uranc eCo. v. D iGregori o , 811 F.2d 124 9 (9th C ir. 1987). The dis tr i ct j ud ge ass um ed that, ifa com pla i nt does not se ek re l i efautho ri zed by§5 02( a) ( 3) , ther e ca nnot be subj ect- m att erj uri sdic tio n. Yet j uri sdic ti on depends on a claim ari sing u nd er federal l aw , not o n w h e t he r a parti cul arr emedyi s av ail able o rwhethe ra c l ai m i s so und on the m er i ts. S ee Bel l v. Hood, 327 U
. S. 6 7 8 (1 9 46). S e c t i o n 5 0 2 ( a ) c o n c e r n s r e me d i e s , n o tj u r i s d i c t i o n . We k n o w fr o m Grab l e& So ns M e t al Pr oducts, Inc
. v. D ar ue Engi ne e r i ng & M anu

f ac t ur i ng, 545 U
. S. 308, 316– 2 0 (2 005), th at stat ut ory aut hority to sup p ly a rem ed y i s a suffi ci ent but not a necess ar y com ponent of federa l j u ri sdic

tio n . A lth ou gh §5 02 (a)( 3) d oe s n ota u t h or ize eq u ita b le re l i eff oran e m plo yer, ther e r em ai ns §2 201, wh i ch authori zes decl ar ato ryj ud gm ents. T he j urisd ictional coun terp art to §50 2 (a ) is §502(e), w hi ch say s t hat di str i ct c ourt s hav e j uri sdic ti on o f ac tio n s “ u n d er th is s u b c h ap te r” . N ew P ag e W isc on sin m ad e a cla im for a d ec l a r a t o ry j u d gm en t “ u n d er th is su bch ap ter”

— th at is, un d er E R ISA . W h e t h er a c laim is good differs from the q ue stion w h e th er a district cou rt po s s e s s e s j ur i s di c t i o n, a ma t t e ro fa dj ud i c a t o r y c om pete n c e. Se e, e.g ., M orrison v. National Australia Ba nk Ltd
. , 13 0 S. C t. 28 69 , 287 6– 77(20 10 ). A fe d er al d ist ric t c ou rtisN o. 10

- 2887 5 the r i ght for um f ora dispute about the m eani ng o f ER I SA and the val i dity o fchange s t o a we l f ar ebe ne fi t pl an . The dist ri ct j ud ge m ay have been thro w n off b y th e fact tha t d eclaratory-j ud gm en t suits ofte n are defe nsi ve in nature , as thi s o ne i s. To deci de w hether a d eclar ato ry -j ud gm ent a cti on co m es w i thi n federa l j ur i sdi ct i o n, a c o ur t m us t di gb el o w the s ur f ace o fthe com p lai nt and l ook at the u n d e r lying con troversy. I f a w ell-p lea d ed co m p lain t b y th e d efe n d an t (t h e “ n at u ra l” pla i nti ff ) w oul d have a ri sen under federa ll aw , then th e co ur t ha s juris di ct i o n whe n the “ na tu r al ” defen dan t bring s a decl ar ato ry -j ud gm ent s uit
. S ee P ubli c Se rvice C o m m ission v. W

yc o ff C o ., 344 U
. S. 237, 248 (1952 ); D eBart ol o v. He al t hSou t h Corp. , 5 69 F
. 3d 73 6 ( 7th Cir. 20 09 ); Wi s co ns i n v . Ho- Chunk Nat i on , 512 F.3d 921 ( 7th Cir. 2008 ). The U ni on has m ade the cour t’ s workea sy by d escribing th e con troversy in its Oh io c om p lai nt ( w he re it w as th e plaintiff ): D efe n d an ts ’ rep u d iat ion of th e t er m s o f th e P lan is ac tio n ab le u n d er E R ISA §5 02 (a)( 1)(B ) an d (a )(3)
. . . . The se ER I SA p ro vi si ons al l ow a part i ci pant or benefi ci ary t o bring a ci vi lact i on “ to re cove r be ne fi ts due t o hi m unde rthe t er m s o fhi s pl an, to e nf o r ce hi s r i g ht s unde rthe te r m s o fthe pl an, orto cl ar i fy hi s r i ghts to future benefits under the t er m s o fthe pla n, . . . ”. The Uni o n a sk ed th e co ur t to “ per m an en tly enj o i n De fen dan ts fr o m t er m i na tingo rmodi fying r et i r ee he al thi n-6 N o. 10

- 2887

s ur a nc e c o v e r a g e pr o v i de d t o Cl a s s M e mbe r s under t h e coll ectively-bargained agreem en ts.” Th e U nion ’s re quest that the di stri ct c ourtpre vent N ew Page W i sconsin fro m al ter i ng the Pl an a rises und er§5 02( a) ( 3) as we l la s § 5 0 2 ( a ) ( 1 )
. B e c a u s e th e U n i o n ’ s s u i tth u s c a me w ith in t h e grant of j urisd iction i n §5 02(e), this m irr ori mag e s ui tb y the P l an’ s s po ns o ra l s o i s wi thin fe der als ubj ec t- m at te rj ur i sdi ct i o n. Sup p ose th is is w rong. A cou rt stil l m u s t i nq uire w hetherano therstatute suppli es j uri sdic ti on. S ee B ri ll v. Count rywid eHom eLo ans, Inc . , 427 F.3d 446 ( 7th Cir. 2005 )
. U nd er28 U
. S. C. §133 1, “di st ri ct c ourt s s hal lhave origina lj ur i sdi ct i o n o fa l lc i vi la ct i o ns a r i singunde rthe Consti tuti on, l aw s, o r tr eaties o fthe U ni ted S tat es”
. T he Sup rem e C ou rt has held that E R IS A clai m s are “n ec es sa rily f e d er al in ch ar ac te r b y v irt u e o f th e c lea rly m ani f est ed i ntent ofCongr ess . ” M et ropoli t an L i fe Ins uranc ev. Tayl or, 481 U
. S. 58, 67( 1987 )
. S ee al so B a rtho let v. R e i s haue rA. G. ( Zür i ch ) , 9 53 F
. 2d 10 73 ( 7th Ci r . 1 99 2) ; Wi ns t e ad v
. J
. C. Pe nney Co. , 9 3 3 F .2d 576, 580 (7th Cir. 1991 ) ( noting tha t § 1331 would prov i de subj ect- m att er j uri sdic ti on e ven i f§5 02( e) di d not)

. N oth i ng in §50 2 su p ersed es o r a b rogates §1 331, and the Su p rem e C ou rt has s ugges ted that§1 331 provi des s u bj ect- m att erj uri sdict ion i nd ependentl y o f§5 02( e)
. S ee Peac oc k v. Thom as , 516 U
. S. 34 9, 35 4 ( 1996 )
. S tat e l aw r egul ating pensi on an d w elfa re -b en efitp lan s h as be en d i sp lac ed , see , e.g., A et n a H ealth Inc
. v. D avila , 5 42 U. S
. 2 00 ( 20 04 ) , s o the cl ai m i n thi s l i ti gat i onm usta r i se un d e rfe d e r a ll a w. J uri sdic ti on i s a pp ro pri ate under bo th §5 02( e) and §13 31.N o. 10

- 2887 7 The dis tr i ct c ourtf oun d thati t had j uri sdic ti on t o c on sid er th e L M R A cla im . 201 0 U .S. D ist . L EXIS71 51 1 a t * 17. Yet §1 85( a) of the LM RA autho ri zes sui t o nl y for
“ v i o l a t i o ns o fc o ntra c t s b e t we e n a n e mpl o y e ra nd a l ab o r organization rep resen ting em p loyees”, an d N ewPa g e W i sc o ns i n’ s co m pl aintdi d n ot a l l eg e th atthe U ni on h ad vio l ate d the CBA

. H ow coul d the di str i ct co ur t ha ve su bj ec t- m at te r j ur i sdi ct i o n o ve rthe LM RA cl ai m but not the ERI SA cl ai m ? I t m ust hav e j uri sd i ctio n ov er bo th , or n eit h er ; w e t h in k th at “b ot h ” is r i g ht gi ve n the mir r o r - i m ag e appr o ac h t o de ci di ng wh e th e ra d e c l a r a t o r y a c t i o n a r i s e s u n d e rfe d e r a ll a w. The r ea so n why the di st r i ctc o ur t di st i ng ui sh ed the E R IS A cla im from th e L M R A cla im is lan gu ag e in New ell O pera ting C o . v . U nited A uto Wo rkers , 53 2 F
. 3d 583 (7th C ir. 2008). T he situation of Newell w a s m at er ially i denti calto thi s ca se: an em plo yerchange d the t er m s o f i ts wel f ar e pl ana nd the n su ed th e par ti ci pan ts s ee k i ng d e c l a r a t o r y re l i e fu n d e rb o th E R I S A a n d th e L MRA
. The dis tr ict co urt ther e be l i eve d i t had j uri sdic ti on o ver th e LM RA cl ai m b utl ac k ed j ur i sdi ct i o n t o he arthe ER I S A c l a i m. In a ffi r mi ngtha tde c i s i o n, we s a i d: [ A ] co m pla i nt cannoti nvoke ERIS A §5 02( a) ( 3) j uri sdic ti on bythe m er e a sse rt i on, witho u t m or e, that ER I SA w i l lbe vi ol ate d. If the Com m i tte e adm i ni ste rs the Pl an as wri tte n, i t will enf or ce th e term s of th e Plan and vind icate it s fi d uc iary d ut ies u n d er ER I SA

— the r eti re es’ di ssa ti sf acti on notwiths tandi ng. 53 2 F .3 d at 589. W e d id n ot m en tion th e m irr ori m age approa ch to deter m i ni ng wh ethera decl arato ry -8 N o. 10

- 2887 j ud gm en t action arises u n d e r fed eral l aw or inq uire w hat the natur alpl ai nti ff s m i ght ha ve al l ege d had they fi l ed a c om pla i nt. New e ll ’s i nc om p lete analysis w as a con seq ue nc e of a d eficie nt pre senta ti on bythe l i ti gants
. The br i ef s in Newellf o cuse d o n whe th erthe fi duci ary ’ s co m pl aint ask ed f or“a pp rop ri ate equi tabl e r el i ef”; the parti es assum ed that a negat i ve answ er w oul d i m ply the a b se n ce ofj uri sdic ti on. W e have e xplained w hy thi s i s no t the r i ght per specti ve. N ow that the subj ect has been e xp l o r e d mor e ful l y, we c o nc l ud e t hat N ew ell

— w hi ch no othe r ci rcui t has f ol l owed

— cannot be t re ate d as author i tat i ve on the questi on of subj ect- m att erj u risdi ct i o n in de cl ar at o r y -j udg m en t ac ti o ns abo utpl an s c o v e r e d b y E R I S A. Ov e r r ul i nga p r e c e de nti s n o ta s t e p we t a k e l i g ht l y. W e ar e m in dfulo fthe po te nt i alf o r“ di srupt i o n, c on fu si o n , an d u n c er ta in ty ” t h at ca n res u lt. John R. Sa nd & G r a vel C o . v. U nited Sta tes , 552 U
. S. 130, 139 (2008 ). Se e a l so B uc hm eier v. U nited Sta tes , 58 1 F .3d 561, 56 5–66 (7t h C ir. 20 09 ) (en ba n c ). N ev er th ele ss a c or re c tio n is re quir ed, bec ause thi s ci rcui t s tands al one. Newell d ep arted from our ow n p reced en t abou t the m irr ori m ag e r ul e i n de cl ar at o r y -j udgm en t ac ti o ns , whi chthe par ti es ’ b r i efs i n Newellreg re t ta b ly n eg lec te d . See , e.g., County M at e r i al s Corp. v. Al l an B l oc k Corp. , 50 2 F
. 3d 730, 73 4 (7 th C ir. 20 07 ); No rthea st Illino is R eg i o na l C o m m uter R .R . v. Ho ey F a r i n a & D o w nes , 21 2 F
. 3d 1010 , 10 14 ( 7th C ir. 20 00 ); G N B Ba tt ery Technolog ie s, Inc. v. Go uld, Inc. , 65 F. 3d 615, 61 9 ( 7th Ci r. 19 95)
. S ee al so Sam uel C . Johns onN o. 10

- 2887 9 1988 Trust v. B ayfie ld Cou nty, N o. 09

- 2876 ( 7th Ci r. J une 17, 2011 ) (rei terating the m irr or-i m age ap p roach ). L ast year p art of Newell w as ove rr ule d by Envis i on He al t hc are, Inc . v. Pr e f e r re dO ne Ins uranc eCo. , 60 4 F
. 3d 983, 985–86 & n.1 ( 7th Cir. 2010) (app ell ate re v iew of a d eci si on to dism i ss a decl ar ato ry -j ud gm ent acti on in f avo r ofa sui t pendingel sewhere is d efer enti alr ather tha n pl e na r y, a s N ewelland so m e pr edecess or s had hel d). W e no w o ver rul e t h e re m ai nd ero fNewell . Th is opi ni on has bee n ci rcul ate d to al lact i ve j ud ges under Cir cui t Rul e 4 0( e)
. N one re quested a hear i ng en banc. T h e s ec on d qu es tio n p re se n te d b y t h is a p p ea l is w hetherthe dist ri ct c ourtabuse d i ts disc re ti on by deci ding that the Ohi o l i ti gat i on i s the ap p ro pri ate for u m for re so lu tio n of th e p ar tie s’ c on tr ov er s y. A p p ell at e r ev i ew i s defer en ti al, a s we h el d i n Envi s i on Heal thc a re . Ev en ts ha ve o ve r ta k enthi s as pec t o fthe di st r i ctc o ur t’ s dec i si o n. N ew Pa g e W i sc o ns i n’ s su i t i n W i sc o ns i n a nd the U ni on’s s uiti n Ohio r ai se the s am e s ubstanti ve i ssues

— did N ew Page W i sco nsi n vi ol ate ei therthe LM RA o r ERI S A whe n i t amende d the Pl an ?

— yet th e pa rties differ: the Union’ s s uiti n Ohio nam ed N ew Page Corp orat i on as the defendant, wh i l e New Page Wisco ns i n fi l ed the acti on i n W i sco nsi n. N ew Page Corpor ati on i s the par ent o f N ewPa g e Con so l i dat ed Pa p ers I nc . , whi chi s th e par en t of N ew P ag e W i s c o n s i n . Th e U n ion d id n otarg u e in O h io , a n d h as n otarg u ed h er e, th at m em b er s o f th is hol ding- com pany st ructur e hav e f ai l ed to r espect cor pora te f or m al i ti es orthatthere i s a ny o therr eas on10 N o. 10

- 2887

w h y N ew P ag e C or p or at ion, a s a n ind ire c t in ve st or in N ew Page W i sco nsi n, sho uld be l i abl e under ei ther ER I SA o r the LM R A . S ee U ni t e d S t at e s v. Be s t f oods , 52 4 U
. S. 51 (1 998)
. W hen the U ni on r eal i zed thati t had su ed the wro nge nt i ty, i t m o ve d t o a m en d i ts c o m pl aint to j o i n NewPag e W i sc o ns i n. Butthe di st r i ctcou rt rej ecte d that am en d m en t as futil e beca us e the cou rt lac ks p er so n al jur isd ict ion ov er N ew P ag e W isc on sin . I t f ound that New Page W i sco nsi n i s o utsi de the re ach of O h io’s lo n g-a rm st at u te
. Cle nde nni ng v. Ne wP ageCorp. , 20 10 U .S. D ist . L EXIS11 28 97at*38 –4 0 (S .D . Oh io Oct. 12 , 20 10) . The c ourtadded that N ew Page Corpor ati o n i s n e i the ra s i g na t o r y o fthe CB A no ra fi du c i a r y o f the ERI SA p l an. I t there f or e di sm i sse d the Un i on’ s s uit
. W hen dis m i ssing the W i sco nsin l i ti gat i on, the dist ric t j ud ge ass um ed tha t th e par ti es’ co ntro ver sy w oul d soo n b e res ol ved el sewhere. That a ssum pti on i s no l onge r w ar ra nted. Even i f the Si xth Cir cui t shoul d reinstat e th e O h io su it, th e W i s c on sin ac tio n w ou ld rem ain far t h e r a d va n c ed . (Th e a p p ea l in th e Six th C irc u it w ill n otbe a r gu ed u n til th is fa ll.) B ec au se th e W isc on sin di s t r i c t c o ur t ha s s ubj e c t
- mat t e rj uri sdic ti on o ver al li ss ue s, a nd pe r so na lj ur i sdi ct i o n o ve ra ll ofthe c o ntes tants , the decl ar ato ry -j ud gm ent s u it n ow seem s a m or e a ttr acti ve m eans ofhandling the co ntro ver sy than i tdi d wh i l e the Oh i o l i t i g a t i o n wa s o ng o i ng . On re m an d, the di s t r i c tc o ur ts ho ul d e mpl o y “ c o ns i de r ati o ns o fpr ac ti ca l i tya nd wi se j udi ci ala dm i ni st r at i o n” ( Wi l t on v. Se ve n Fal l s Co. , 51 5 U.S
. 27 7, 28 8 ( 1995 ) ) to d ec ide w hetherto address the m er i ts, o r aga i n w ait f ordevel opm ents i n Ohio

.N o. 10

- 2887 11 The j ud gm ent i s v acat ed, and the cas e is r em anded f o rpr o ce eding s co ns i st en t wi ththi s o pi ni o n.

7- 12- 11