1 

RECOMMENDED FOR FULL-TEXT PUBLICATION 

Pursuant to Sixth Circuit I.O.P. 32.1(b) 

File Name: 16a0297p.06 

UNITED STATES COURT OF APPEALS

FOR THE SIXTH CIRCUIT 

_________________ 

DANIEL P. SOEHNLEN; BILL REEVES; SUPERIOR 

DAIRY, INC., 

Plaintiffs-Appellants, 

v. 

FLEET OWNERS INSURANCE FUND; ROBERT 

KAVALEC; CHARLIE ALFERIO; VICTOR COLLOVA, 

Defendants-Appellees. 

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No. 16-3124 

Appeal from the United States District Court 

for the Northern District of Ohio at Cleveland. 

No. 1:15-cv-00445—Donald C. Nugent, District Judge. 

Argued: October 18, 2016 

Decided and Filed: December 21, 2016 

Before: KEITH, BATCHELDER, and CLAY, Circuit Judges. 

_________________ 

COUNSEL 

ARGUED: Keith L. Pryatel, KASTNER WESTMAN & WILKINS, LLC, Akron, Ohio, for 

Appellants. Eric G. Serron, STEPTOE & JOHNSON LLP, Washington, D.C., for Appellees. 

ON BRIEF: Keith L. Pryatel, Kenneth M. Haneline, KASTNER WESTMAN & WILKINS, 

LLC, Akron, Ohio, for Appellants. Eric G. Serron, Paul J. Ondrasik, Jr., Osvaldo Vazquez, 

STEPTOE & JOHNSON LLP, Washington, D.C., Lance B. Johnson, LANCE B. JOHNSON 

LLP, Cleveland, Ohio, for Appellees. 

>
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 2 

_________________ 

OPINION 

_________________ 

CLAY, Circuit Judge. Plaintiffs Daniel Soehnlen, Bill Reeves, and Superior Dairy, Inc. 

filed suit alleging that Defendants Fleet Owners Insurance Fund, Robert Kavalec, Charlie Alferio 

and Victor Collova, breached a range of obligations under the Employee Retirement Security Act 

of 1974 (“ERISA”), 29 U.S.C. §§ 1001 et seq. (1974), the Patient Protection and Affordable 

Care Act of 2010 (“ACA”), 26 U.S.C. § 5000A (Pub. L. No. 111-148, as modified by the 

subsequently enacted Health Care and Education Reconciliation Act, Pub. L. No. 111-152 

(2010)), and § 302 of the Labor Management Relations Act (“Taft-Hartley Act”), 29 U.S.C. 

§ 186 (1988). Plaintiffs also brought breach of contract claims. The district court dismissed 

Plaintiffs’ complaint for failure to state a claim and for lack of standing. For the reasons that 

follow, we AFFIRM the district court’s judgment. 

BACKGROUND

Factual Background 

Plaintiff Superior Dairy, Inc. (“Superior Dairy”) is an Ohio Corporation that engages in 

the manufacture and processing of milk-based products. Plaintiff Daniel P. Soehnlen is President 

and Chief Executive Officer of Superior Dairy. Plaintiff Bill Reeves is an hourly employee of 

Superior Dairy, who also serves as a union steward on behalf of the International Brotherhood of 

Teamsters, Chauffeurs, Warehousemen, and Helpers of America, General Trucker Drivers and 

Helpers, Local Union No. 92. As the parties concede, Defendant Fleet Owners Insurance Fund 

(“Fleet Owners” or the “Plan”) is a multi-employer “welfare benefit plan” within the meaning of 

ERISA, 29 U.S.C. § 1001, and a “group health plan” within meaning of the ACA, and therefore 

is covered by both ERISA and the ACA. Defendants, Robert Kavalec, Charlie Alferio, and 

Victor Collova are each represented to be either current or former trustees for the Plan, 

responsible for overseeing its operation. 

 In order to provide medical coverage to its employees, Superior Dairy contracted with 

Fleet Owners and memorialized the terms of their agreement by signing the participation 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 3 

agreement (the “Participation Agreement”) on April 14, 2014. The Participation Agreement 

incorporated by reference the Amended and Restated Agreement and Declaration of Trust signed 

in 2002 (“Trust Agreement”). Plaintiffs allege in their amended complaint that prior to entering 

into the Participation Agreement, they received certain assurances from Fleet Owners and 

individual trustees of the Plan, that the Plan would comply in all respects with federal law, 

including ERISA and the ACA. 

According to Plaintiffs, notwithstanding the ACA’s statutory requirement mandating that 

all group health plans eliminate per-participant and per-beneficiary pecuniary caps for both 

annual and lifetime benefits, the Plan maintains such restrictions. Consequently, Superior Dairy 

purchased supplemental health insurance benefits to fully cover its employees. Defendants do 

not, at this time, dispute the existence of benefit caps within the plan, but instead argue that the 

Plan is exempt from such requirements because it is a “grandfathered” plan. 

Procedural History

Plaintiffs filed their complaint against Defendants alleging violations of the ACA, 

ERISA, Taft-Hartley Act, and various provisions of the Trust Agreement and Participation 

Agreement that govern the Plan. The action was brought both on behalf of individual named 

Plaintiffs, Soehnlen and Reeves, and the company Superior Dairy, and on behalf of a class of 

similarly situated employees. The district court dismissed all seven counts alleged in Plaintiffs’ 

complaint. Plaintiffs appeal every one of the district court’s conclusions; we therefore consider 

each argument below. 

DISCUSSION

Standard of Review

This Court reviews de novo both a district court’s decision to dismiss the complaint for 

lack of subject matter jurisdiction and to dismiss for failure to state a claim. See Gaylor v. 

Hamilton Crossing CMBS, 582 F. App’x 576, 579 (6th Cir. 2014); In re Carter, 553 F.3d 979, 

984 (6th Cir. 2009) (“Where a district court rules on a 12(b)(1) motion to dismiss that attacks the 

claim of jurisdiction on its face, this Court reviews the decision de novo.”) To avoid dismissal 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 4 

under Rule 12(b)(6), a complaint must provide sufficient facts to state a claim that is plausible on 

its face. See Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). And where a plaintiff’s 

Article III standing is at issue, the plaintiff must allege facts sufficient to establish the requisite 

individualized harm. See Keener v. Nat’l Nurses Org. Comm., 615 F. App’x 246, 251 (6th Cir. 

2015). 

Analysis

I. ERISA Claims 

1. Count I and II: Monetary and Injunctive Relief under 29 U.S.C. § 1132 (a)(1)(B)

Plaintiffs allege that by failing to comply with the ACA provisions enjoining annual and 

life-time limitations on benefits, Defendants violated their ERISA rights. Consequently, 

Plaintiffs seek monetary and injunctive relief under 29 U.S.C. § 1132(a)(1)(B) of ERISA, which 

states that a civil action may be brought in federal court “by a participant or beneficiary . . . to 

recover benefits due to him under the terms of his plan, to enforce his rights under the terms of 

the plan, or to clarify his rights to future benefits under the terms of the plan.” The district court 

dismissed the first two claims of Plaintiffs’ complaint for lack of standing. Arguing that they 

have sufficiently pleaded an invasion of their congressionally defined rights, Plaintiffs ask us to 

reverse the district court. We decline to do so. 

As has been reaffirmed countless times, there are two components to any given standing 

inquiry: constitutional and statutory. The Supreme Court has recently clarified, however, that 

what has been called “statutory standing” in fact is not a standing issue, but simply a question of 

whether the particular plaintiff “has a cause of action under the statute.” Am. Psychiatric Ass’n 

v. Anthem Health Plans, Inc., 821 F.3d 352, 359 (2d Cir. 2016) (citing Lexmark Int’l, Inc. v. 

Static Control Components, Inc., 134 S. Ct. 1377, 1386 (2014)). Defendants do not oppose, and 

we assume without considering, that Plaintiffs have a valid cause of action under ERISA in order 

to bring their § 1132(a)(1)(B) claim. But, as has been repeatedly proclaimed by the Supreme 

Court, even if a plaintiff has a cause of action arising under a given statute, “federal courts . . . 

have only the power that is authorized by Article III” and, therefore, we must analyze standing 

under Article III. See, e.g., Bender v. Williamsport Area Sch. Dist., 475 U.S. 534, 541 (1986). 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 5 

With respect to claims arising under ERISA, plaintiffs are not absolved from showing that the 

elements of Article III are met. Loren v. Blue Cross & Blue Shield of Mich., 505 F.3d 598, 606–

07 (6th Cir. 2007) (citing Cent. States Se. & Sw. Areas Health and Welfare Fund v. Merck–

Medco Managed Care, 433 F.3d 181, 199 (2nd Cir. 2005)). 

“Article III limits the judicial power of the United States . . . and ‘Article III standing . . . 

enforces the Constitution’s case-or-controversy requirement.’” Hein v. Freedom From Religion 

Found., Inc., 551 U.S. 587, 597–98 (2007) (quoting Elk Grove Unified Sch. Dist. v. Newdow, 

542 U.S. 1, 11 (2004)). Consequently, it must be determined whether Plaintiffs have “‘such a 

personal stake in the outcome of the controversy’ as to warrant [their] invocation of federal-court 

jurisdiction and to justify exercise of the court’s remedial powers on [their] behalf.” Warth v. 

Seldin, 422 U.S. 490, 498–99 (1975) (quoting Baker v. Carr, 369 U.S. 186, 204 (1962)). 

Plaintiffs bear the burden of establishing standing. See Lujan v. Defenders of Wildlife, 504 U.S. 

555, 561(1992). To satisfy Article III’s standing requirements, a plaintiff must show: “(1) [he] 

has suffered an ‘injury-in-fact’ that is (a) concrete and particularized and (b) actual or imminent, 

not conjectural or hypothetical; (2) the injury is fairly traceable to the challenged action of the 

defendant; and (3) it is likely, as opposed to merely speculative, that the injury will be redressed 

by a favorable decision.” Loren, 505 F.3d at 606–07 (quoting Friends of the Earth, Inc. v. 

Laidlaw Envtl. Servs., 528 U.S. 167, 180–81 (2000)). 

 We scrutinize the “injury-in-fact” element of standing in order to determine not just 

whether Plaintiffs have sufficiently pleaded a statutory injury, but a constitutional one as well. 

As the Supreme Court recently affirmed in Spokeo, Inc. v. Robins, an injury-in-fact contains the 

two distinct elements of particularization and concreteness. 136 S. Ct. 1540, 1548–50 (2016). 

For an injury to be particularized, “it must affect the plaintiff in a personal and individual way.” 

Id. at 1548 (quoting Lujan, 504 U.S. at 560); see also Valley Forge Christian Coll. v. Americans 

United for Separation of Church & State, Inc., 454 U.S. 464, 472 (1982) (standing requires 

that the plaintiff “personally has suffered some actual or threatened injury”). While 

“particularization is necessary to establish injury in fact[,] . . . it is not sufficient.” Spokeo, 136 

S. Ct. at 1548. A plaintiff must also show that he suffered a concrete injury, defined as a “de 

facto” injury, meaning that the injury “must actually exist.” Id.
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 6 

 Pointing specifically to Spokeo, Plaintiffs contend that the Supreme Court has radically 

altered the landscape for pleading injury-in-fact. Consequently, they believe that by merely 

alleging a violation of ERISA rights, they satisfy their obligation under Article III. We disagree 

on both points. While we recognize that the Supreme Court acknowledged that non-tangible 

injuries, including violations of statutory rights, may satisfy the constitutional showing of an 

injury-in-fact, we also take the Court at its word when it cautions that “Congress’ role in 

identifying and elevating intangible harms does not mean that a plaintiff automatically satisfies 

the injury-in-fact requirement whenever a statute grants a person a statutory right and purports to 

authorize that person to sue to vindicate that right.” Id. “Article III standing requires a concrete 

injury even in the context of a statutory violation.” Id. Therefore, even if we assume the injury 

is sufficiently particularized, Plaintiffs must still show that the deprivation of a right created by 

statute is accompanied by “some concrete interest that is affected by the deprivation.” Id.

(quoting Summers v. Earth Island Inst., 555 U.S. 488, 496 (2009)). A “concrete” intangible 

injury based on a statutory violation must constitute a “risk of real harm” to the plaintiff. Id.

 Plaintiffs argue, in extreme generality, that certain members of their class suffer from 

conditions that have previously required medical expenses in excess of the benefit caps imposed 

by the Plan. They also claim that some of their employees will choose to delay important 

medical procedures in order to avoid exceeding the cap. We again reiterate, Plaintiffs are not 

absolved of their individual obligation to satisfy the injury element of Article III just because 

they allege class claims. We previously made clear that potential class representatives must 

demonstrate “individual standing vis-a-vis the defendant; [they] cannot acquire such standing 

merely by virtue of bringing a class action.” Fallick v. Nationwide Mut. Ins. Co., 162 F.3d 410, 

423 (6th Cir. 1998). Individual Plaintiffs never show precisely what concrete harm they suffer as 

a result of Defendants’ violations of their ERISA rights. By merely arguing, as Plaintiffs do, that 

the pecuniary limitations imposed by the Plan exist, without anything further, Plaintiffs cannot 

hope to satisfy the concreteness prong of the injury-in-fact requirement of Article III.1

 See Lee v. 

 1

With respect to Plaintiffs’ assertion that Plaintiff Superior Dairy suffered an injury by having to purchase 

supplemental insurance, claims by an employer are not cognizable under § 1132(a)(1)(B). See Girl Scouts of Middle 

Tennessee, Inc. v. Girl Scouts of the U.S.A., 770 F.3d 414, 418 (6th Cir. 2014) (“As an employer in a multipleemployer plan, GSMT concedes that it has no valid cause of action under ERISA); see also Whitworth Brothers 

Storage Co. v. Central States, Southeast and Southwest Areas Pension Fund, 794 F.2d 221, 225–27 (6th Cir. 1986) 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 7 

Verizon Commc’ns, Inc., No. 14-10553, 2016 WL 4926159, at *2 (5th Cir. Sept. 15, 2016) 

(explaining that Kendall v. Emps. Ret. Plan of Avon Prods., 561 F.3d 112, 120 (2d Cir. 2009) 

rejected the argument that defendants’ violation of their statutory duties under ERISA is in and 

of itself an injury in fact to the plaintiff). 

To the extent that Plaintiffs claim they personally suffer a constitutional injury by 

remitting money towards a non-compliant plan, they cannot state a claim. This Court has 

already determined that under § 1132(a)(1)(B), the mere fact that a plaintiff pays funds into a 

non-compliant plan, if an injury at all, is “neither concrete nor particularized, and is instead, 

arguably conjectural and hypothetical” and therefore does not satisfy injury-in-fact. Loren, 

505 F.3d at 608. Accordingly, we dismiss Plaintiffs’ first two claims for lack of subject matter 

jurisdiction.2 

2. Count III: Monetary and Injunctive Relief under § 1132(a)(1)(B) and § 1132(a)(3) 

In Count III of their complaint, Plaintiffs, without introducing any additional facts, allege 

that Defendants have refused to provide benefits and coverage mandated by the ACA and 

ERISA. They seek to enjoin future violations and obtain appropriate monetary, declaratory, and 

equitable relief to redress the violations under § 1132(a)(1)(B) and § 1132(a)(3). In relevant 

part, § 1132(a)(3) reads: 

a civil action may be brought . . . by a participant, beneficiary, or fiduciary (A) to 

enjoin any act or practice which violates any provision of this subchapter or the 

terms of the plan, or (B) to obtain other appropriate equitable relief (i) to redress 

such violations or (ii) to enforce any provisions of this subchapter or the terms of 

the plan. 

 (explaining that the principal civil enforcement provision of ERISA did not grant jurisdiction to employers, aside 

from some causes of action under multiemployer plans). 

2

It should be pointed out that we would just as likely dismiss Plaintiffs’ argument on the merits as well. In 

CIGNA Corp. v. Amara, the Supreme Court made clear that § 1132(a)(1)(B) does not afford a court any “authority 

to reform [a] plan as written.” 563 U.S. 421, 438 (2011). “The statutory language speaks of enforcing the terms of 

the plan, not of changing them.” Id. at 436. By arguing that the terms of the Plan do not comply with the law, 

Plaintiffs tacitly concede that the relief they seek exists outside the scope of their plan. And an action attempting to 

re-write the terms of a plan is unavailable under § 1132(a)(1)(B). See Pender v. Bank of Am. Corp., 788 F.3d 354, 

361–62 (4th Cir. 2015) (holding that a cause of action could not be advanced under § 1132(a)(1)(B) when the 

plaintiffs sought to enforce the plan “not as written, but as it should properly be enforced under ERISA.”). 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 8 

As the Supreme Court explained in Varity Corp. v. Howe, 516 U.S. 489 (1996) § 1132(a)(3) is a 

“catch-all” provision that “act[s] as a safety net, offering appropriate equitable relief for injuries 

caused by violations that [§ 1132] does not elsewhere adequately remedy.” Id. at 512. 

Nonetheless, Plaintiffs’ arguments once again run counter to the mandate of Article III. 

First, as a threshold matter, when bringing a suit under § 1132(a)(3) for monetary relief, 

plaintiffs must establish injury-in-fact. See Loren, 505 F.3d at 609; see also Perelman v. 

Perelman, 793 F.3d 368, 373 (3d Cir. 2015) (“claims demanding a monetary equitable remedy 

. . . require the plaintiff to allege an individualized financial harm traceable to the defendant’s 

alleged ERISA violations); Cent. States, 433 F.3d at 200 (“obtaining restitution or disgorgement 

under ERISA requires that a plaintiff satisfy the strictures of constitutional standing by 

demonstrat[ing] individual loss”); Harley v. Minn. Mining and Mfg. Co., 284 F.3d 901, 906–07 

(8th Cir. 2002) (holding no constitutional standing existed because the “loss did not cause actual 

injury to plaintiffs’ interests in the plan”). Consequently, to the extent Plaintiffs’ claim under 

§ 1132(a)(3) seeks monetary relief, it must be dismissed because, as previously discussed, 

Plaintiffs did not demonstrate individual harm. 

However, with respect to their request for injunctive relief, Plaintiffs contend, relying 

upon Horvath v. Keystone Health Plan East, Inc., 333 F.3d 450 (3d Cir. 2003), subsequently 

cited by this Court in Loren, 505 F.3d at 609–10, that a plaintiff need not establish “actual harm” 

under § 1132(a)(3). We again disagree. To the extent we have allowed cases to go forward 

without compelling plaintiffs to show individualized injury, the cases were advanced under a 

different theory of liability than alleged by Plaintiffs. The plaintiffs in both Horvath and Loren

argued that defendants breached their fiduciary duties under the ERISA plan. A plaintiff who 

brings suit under § 1132(a)(2) for breach of fiduciary duty does so in order to “seek recovery on 

behalf of the plan.” Loren, 505 F.3d at 608; see also Mass. Mutual Life Ins. Co. v. Russell, 

473 U.S. 134, 140 (1985) (holding that a participant’s fiduciary action brought pursuant to 

§ 1132(a)(2) must seek remedies that provide a “benefit [to] the plan as a whole”); Braden v. 

Wal-Mart Stores, Inc., 588 F.3d 585, 593 (8th Cir. 2009) (“It is well settled, moreover, that suit 

under § 1132(a)(2) is brought in a representative capacity on behalf of the plan as a whole and 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 9 

that remedies under § 1109 protect the entire plan.”). Any recovery does not accrue to the 

plaintiff, but the plan itself. 

Plaintiffs pair their request for injunctive relief with allegations of a breach of 

§ 1132(a)(1)(B), a statute requiring a court to make individualized determinations of benefits. 

Although we have noted that there is a distinction between an individual claim for benefits under 

§ 1132(a)(1)(B) and a claim brought under § 1132(a)(3) to compel a defendant to alter the 

manner in which it administers all the claims under the plan, see Hill v. Blue Cross and Blue 

Shield of Mich., 409 F.3d 710 (6th Cir. 2005), we have never held that such a claim can proceed 

without the individual plaintiffs’ showing a constitutional injury. And we decline to do so now, 

finding that Plaintiffs cannot escape their obligation to show a constitutional injury.3

3. Count IV: Breach of Fiduciary Duty 

Count IV of Plaintiffs’ complaint alleges that Defendant trustees Kavalec, Collova and 

Alferio have each breached their fiduciary obligations to the Plan, subjecting it to over 

$15,000,000 in taxes and penalties. In turn, they request appropriate monetary, injunctive, and 

equitable relief pursuant to 29 U.S.C. § 1132(a)(2); 29 U.S.C. § 1132(a)(3); and 29 U.S.C. 

§ 1109(a). We reject their claim for monetary relief, because as previously discussed, individual 

plaintiffs bringing an action for monetary relief, even one brought derivatively on behalf of a 

plan, must personally satisfy the requirements of Article III. See Loren, 505 F.3d at 609. 

Nonetheless, Plaintiffs press their claim for injunctive relief, arguing they need not show 

individual injury to obtain injunctive relief for a breach of fiduciary duty, relying again upon 

Horvath and Loren. In Loren, we considered a similar argument pursuant to § 1132(a)(2) and 

§ 1132(a)(3), and recognized that while the plaintiffs’ arguments under § 1132(a)(2) were “too 

speculative to establish constitutional standing,” Loren, 505 F.3d at 609, plaintiffs’ action 

requesting injunctive relief may proceed under § 1132(a)(3) “to ERISA’s disclosure and 

fiduciary duty requirements without a showing of individual harm.” Id. (citing Cent. States, 

433 F.3d at 199 and Horvath, 333 F.3d at 450). We concluded that “[p]laintiffs need not 

 3

In the alternative, this claim may be dismissed on ripeness grounds because it is “anchored in future 

events that may not occur as anticipated, or at all.” Nat’l Rifle Ass’n of Am. v. Magaw, 132 F.3d 272, 284 (6th Cir. 

1997). 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 10

demonstrate individualized injury to proceed with their claims for injunctive relief under 

§ 1132(a)(3); they may allege only violation of the fiduciary duty owed to them as a participant 

in and beneficiary of their respective ERISA plans.” Id. 

We now recognize that some ambiguity may have been engendered by this decision and 

take this opportunity to provide clarification. There is no doubt that ERISA imposes on plan 

fiduciaries a duty to act in accordance with the documents and instruments governing the plan 

insofar as such documents and instruments are consistent with the provisions of ERISA. 

29 U.S.C. § 1104(a)(1)(D). However, it is not sufficient merely to state, as Plaintiffs do, that the 

plan is deficient without showing which specific fiduciary duty or specific right owed to them 

was infringed. See Kendall 561 F.3d at 120 (narrowing the broad language of Horvath and 

noting plaintiffs “did have to show that they were generally harmed by the deprivation of a 

specific right.”) (emphasis added). Plaintiffs argument again suffers from the same lack of 

concreteness with respect to injury as previously explained. We recognize that misconduct by 

the administrators of a benefit plan can create an injury if “it creates or enhances a risk of default 

by the entire plan.” LaRue v. DeWolff, Boberg & Associates, Inc., 552 U.S. 248, 255 (2008). But 

Plaintiffs make no showing of actual or imminent injury to the Plan itself. Plaintiffs concede this 

point by pleading that the actions of the fiduciaries expose the Plan to prospective liability in the 

amount of $15,000,000. To the extent that Plaintiffs argue that the risk of an enforcement action 

is itself sufficient to constitute an injury, we find in the absence of any evidence that penalties 

have been levied, paid, or even contemplated that “these risk-based theories of standing [are] 

unpersuasive, not least because they rest on a highly speculative foundation lacking any 

discernible limiting principle.” David v. Alphin, 704 F.3d 327, 338 (4th Cir. 2013). We 

therefore affirm the district court’s finding that Plaintiffs’ lack standing to bring this claim. 

4. Count V: Breach of § 1149

In Count V of their complaint, Plaintiffs argue pursuant to 29 U.S.C. § 1149 that 

Defendants Robert Kavalec, Victor Collova, and Charlie Alferio made false statements and false 

representations of fact, knowing these representations to be false in connection with the 

advertising, marketing or sale to Superior Dairy. Allegedly, Defendants made certain promises 

to Plaintiffs that the Plan would comply in all respects with ERISA and welfare benefit laws; 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 11

such assurances were instrumental to Superior Dairy’s contracting with Fleet Owners to have the 

Plan provide medical benefits. 

Interpreting § 1149 presents this Court with an issue of first impression.4

 Neither litigant 

points to a single case construing § 1149 or produces concrete authority regarding whether 

§ 1149 provides Plaintiffs with a cause of action. But, even if we assume, which we now do 

without deciding, that it does, we must still dismiss for failure to state a claim upon which relief 

can be granted.5 Section § 1149 provides in relevant part: 

No person, in connection with a plan or other arrangement that is[a] multiple 

employer welfare arrangement described in section 1002(40) of this title, shall 

make a false statement or false representation of fact, knowing it to be false, in 

connection with the marketing or sale of such plan or arrangement, to any 

employee, any member of an employee organization, any beneficiary, any 

employer, any employee organization, the Secretary, or any State, or the 

representative or agent of any such person, State, or the Secretary, concerning 

. . . . (2) The benefits provided by such plan or arrangement. 

29 U.S.C. § 1149 (emphasis added). 

 In instances where we have been faced with similar statutory language, we have found 

that a heightened pleading standard, as expressed under Fed. R. Civ. P. 9(b), should be applied to 

a plaintiff’s allegations. See, e.g., U.S. ex rel. SNAPP, Inc. v. Ford Motor Co., 532 F.3d 496, 

504–05 (6th Cir. 2008) (finding that a qui tam action under the False Claims Act should be pled 

under Rule 9(b) because it imposes liability on a person who “knowingly makes, uses, or causes 

to be made or used, a false record or statement to get a false or fraudulent claim paid or approved 

by the government.”) (emphasis added). 

 Dismissal of a complaint for failure to comply with Rule 9(b) is reviewed as a dismissal 

for failure to state a claim. SNAPP, Inc., 532 F.3d at 502. A complaint may be dismissed if it 

contains “no specific information about the filing of the claims themselves—nothing, that is, to 

 4

The District Court dismissed the action, finding that § 1149 was a criminal-only enforcement provision, 

thereby falling within the exclusive purview of the Attorney General and affording no individual cause of action. 

5

When the standard of review is de novo and involves only applications of legal conclusions to the 

undisputed facts in the record, we may affirm on any grounds supported by the record even if different from the 

reasons of the district court. Angel v. Ky., 314 F.3d 262, 264 (6th Cir. 2002) (citing Abercrombie & Fitch Stores, 

Inc. v. Am. Eagle Outfitters, Inc., 280 F.3d 619, 629 (6th Cir. 2002). 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 12

alert the defendants ‘to the precise misconduct with which they are charged and [to] protect[] 

defendants against spurious charges of immoral and fraudulent behavior.’” Sanderson v. HCA–

The Healthcare Company, 447 F.3d 873, 877 (6th Cir. 2006) (quoting United States ex rel. 

Clausen v. Laboratory Corp. of America, Inc., 290 F.3d 1301, 1310 (11th Cir. 2002)). To insure 

that a defendant has sufficient notice, a plaintiff must “allege the time, place and content of the 

alleged misrepresentation; the fraudulent intent of the defendants; and the injury resulting from 

the fraud.” United States ex rel Bledsoe v. Cmty. Health Sys., Inc., 501 F.3d 493, 502 (6th Cir. 

2007). 

 Plaintiffs allege a violation under § 1149, which requires a showing of a false statement 

or false representation of fact; knowledge that the statement was false; and a connection with the 

marketing or sale of an ERISA plan. Under Rule 9(b), a plaintiff must plead each element of a 

fraud action with the requisite particularity in order to state a claim upon which relief can be 

granted. See Heinrich v. Waiting Angels Adoption Servs., Inc., 668 F.3d 393, 404 (6th Cir. 

2012). Plaintiffs failed to do so in the instant case. 

 In their complaint, Plaintiffs do nothing more than restate the relevant section of § 1149 

by claiming that the individual trustees made false statements and false representations of fact, 

knowing these representations to be false in connection with the advertising, marketing or sale to 

Superior Dairy during the course of their negotiations. The only specificity included in 

Plaintiffs’ complaint refers to Defendants’ promise that the Plan would comply in all respects 

with ERISA and welfare benefit laws, including without limitation the ACA. No further 

reference is made to false statements in Plaintiffs’ amended complaint. At no point do Plaintiffs 

identify specific statements from particular trustees at specific times which constitute the 

purportedly false promises and assurances Plaintiffs now claim they relied upon. 

Although the application of Rule 9(b) does not require formulaic compliance, we have 

made clear that in order to plead fraud with particularity, a plaintiff must allege among other 

things “the time, place, and content of the alleged misrepresentation.” Bledsoe, 501 F.3d at 504. 

The rule’s purpose is to alert defendants “as to the particulars of their alleged misconduct” so 

that they may respond. Chesbrough v. VPA, P.C., 655 F.3d 461, 466 (6th Cir. 2011) (citing 

Bledsoe, 501 F.3d at 503). The heightened pleading standards are designed to prevent “fishing 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 13

expeditions,” protect defendants’ reputation from allegations of fraud, and to narrow potentially 

wide-ranging discovery to relevant matters. Id. Plaintiffs’ one sentence allegation does nothing 

to alleviate the concerns underscored by Rule 9(b) and we, therefore, dismiss this claim and turn 

to Plaintiffs’ non-ERISA claims. 

II. Plaintiffs’ Additional Claims 

1. Count VI: The Taft-Hartley Act 

Plaintiffs allege that Defendants have breached § 186 (a–e) of the Taft-Hartley Act 

because the Plan fails to identify a neutral third party that will break deadlocks amongst the 

parties in the event of a benefit dispute. The district court dismissed, finding that the Supreme 

Court decision, Local 144 Nursing Home Pension Fund v. Demisay, 508 U.S. 581 (1993), 

foreclosed this action. We agree, and affirm the dismissal. 

In Demisay, the Supreme Court held that § 186(e), the jurisdictional component of the 

Taft-Hartley statute allowing a plaintiff to bring injunctive relief to enforce violations, did not 

extend to claims “requiring the trust funds to be administered in the manner described in 

§ [186(c)(5)].” Demisay, 508 U.S. at 588. Plaintiffs’ claim rests entirely upon such a challenge 

and their complaint restates essentially word for word language derived from § 186(c)(5). 

The Supreme Court was quite clear that “[t]he trustees’ failure to comply with [§ 186(c)] may be 

a breach of their contractual or fiduciary obligations and may subject them to suit for such 

breach; but it is no violation of § [186].” Id. at 588–89.

Relying upon Lipton v. Consumer Union of U.S., Inc., 37 F. Supp. 2d 241, 245 (S.D.N.Y. 

1999), Plaintiffs advance an alternative reading of Demisay that distinguishes between instances 

in which a plaintiff seeks recovery of money already contributed to the fund and the situation at 

hand where Plaintiffs wish to enjoin future monthly payments to the Plan. We reject such a 

tortured reading of Lipton and by extension Demisay. In Lipton, the plaintiffs argued that by 

limiting the trustee’s power to invest in any equity security not intended to benefit the union, the 

fund violated the Taft-Hartley Act. See id. at 242. The court agreed, finding that such a 

challenge proceeded not under § 186(c) but under § 186(a) because it questioned the initial 

purpose for which the fund was established. The district court noted that a § 186(c) violation, 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 14

while itself not cognizable, could be used as evidence to show a violation under either § 186(a) 

or (b). 

In explaining Demisay, the district court made two important observations. Plaintiffs rest 

their conclusion entirely upon the first: the timing of when money is paid out is important. But, 

Lipton also states quite clearly that: 

The [Supreme] Court drew also a second distinction, between establishment of a 

trust for a particular purpose and operation in compliance with that purpose. The 

exception in Section [186(c)(5)], the Court said, “relates, not to the purpose for 

which the trust fund is in fact used (an unrestricted fund that happens to be used 

for the sole and exclusive benefit of the employees does not qualify); but rather to 

the purpose for which the trust fund is established and for which the payments are 

held in trust.” 

Id. at 245 (quoting Demisay, 508 U.S. at 588). 

Lipton concluded that to state a claim under Taft-Hartley, the suit must challenge the 

“purposes for which this fund was established” rather than the mechanisms by which the fund 

operates. Id. at 246. It again reaffirmed that courts do not have “jurisdiction over administration 

of a fund or operation in compliance with the purposes of § [186(c)(5)].” Courts, however, do 

“have jurisdiction . . . over questions of the purpose for which a fund is established.” Id. at 245. 

Along with our sister circuits, we have endorsed a similar reading of the Taft-Hartley Act 

that seeks to distinguish the purpose behind the plan’s founding and the manner by which the 

plan now operates. See Myers v. Bricklayers & Masons Local 22 Pension Plan, 629 F. App’x 

681, 685 (6th Cir. 2015) (“[B]ecause [plaintiff] alleges no bribery, extortion, or misuse of union 

funds, 29 U.S.C. § 186 offers no relief.”); Schneider v. Local 103 I.B.E.W. Health Plan, 442 F.3d 

1, 2 (1st Cir. 2006) (recognizing the distinction between how contributions “are used” and the 

purpose for which the fund was “established,” but rejecting the challenge because the complaint 

failed to plead this); DeVito v. Hempstead China Shop, Inc., 38 F.3d 651, 654 (2d Cir. 1994) 

(“[Plaintiff] does not contest that the [Plan] was properly established under § 302(c)(5), but 

contends that it subsequently operated in a manner inconsistent with § 302(c)(5). 

Demisay precludes this argument.”) Therefore, the only manner by which a violation of 

§ 186(c)(5) is relevant is if a plaintiff alleges that the plan was established for a purpose 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 15

contravening law. Plaintiffs make no such allegations of fraudulent purpose. Accordingly, we 

cannot countenance Plaintiffs’ argument after Demisay. 

2. Counts VII and VIII: Breach of Contract 

Finally, Plaintiffs bring breach of contract claims. Prior to considering the merits of such 

state law claims, a court of appeals “must determine its own jurisdiction and is bound to do so in 

every instance.” Packard v. Farmers Ins. Co. of Columbus Inc., 423 F. App’x 580, 583 (6th Cir. 

2011) (quoting Carson v. U.S. Office of Special Counsel, 633 F.3d 487, 491 (6th Cir. 2011)). 

Courts may exercise supplemental jurisdiction over any state law claim that “form[s] part of the 

same case or controversy” as matters arising under original jurisdiction. 28 U.S.C. § 1367(a). 

“Claims form part of the same case or controversy when they derive from a common nucleus of 

operative facts.” Harper v. AutoAlliance Int’l, Inc., 392 F.3d 195, 209 (6th Cir. 2004). This 

requirement is met when state and federal law claims arise from the same contract, dispute, or 

transaction. See, e.g., Carnegie—Mellon Univ. v. Cohill, 484 U.S. 343, 350–51 (1988); Capital 

Park Ltd. Dividend Hous. Ass’n v. Jackson, 202 F. App’x. 873, 877 (6th Cir. 2006). Because 

Plaintiffs’ complaint raised federal and state law claims that stemmed from the same 

transaction—the breach of underlying ERISA obligations—it is proper for us to exercise 

supplemental jurisdiction over their claims. Plaintiffs allege that Defendants have breached, and 

continue to breach, both the Participation Agreement and the Trust Agreement by not complying 

with the ACA and ERISA. These claims are preempted by ERISA. 

ERISA has one express preemption provision. It applies equally to all ERISA benefit 

plans, preempting all state law claims that “relate to any employee benefit plan.” 29 U.S.C. 

§ 1144(a). The Supreme Court has noted that “the policy choices reflected in the inclusion of 

certain remedies and the exclusion of others under the federal scheme would be completely 

undermined if ERISA-plan participants . . . were free to obtain remedies under state law that 

Congress rejected in ERISA.” Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 54 (1987). 

Accordingly, “any state-law cause of action that duplicates, supplements, or supplants the 

ERISA civil enforcement remedy conflicts with the clear congressional intent to make the 

ERISA remedy exclusive and is therefore pre-empted.” Aetna Health Inc. v. Davila, 542 U.S. 

200, 209 (2004); see also Loffredo v. Daimler AG, 500 F. App’x 491, 495 (6th Cir. 2012) (citing 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 16

to Penny/Ohlmann/Nieman, Inc. v. Miami Valley Pension Corp., 399 F.3d 692, 698 (6th Cir. 

2005) for the holding that ERISA preempts state laws that “provide alternative enforcement 

mechanisms.”) ERISA specifically provides for remedies for breaches of contract and fiduciary 

duties. Consequently, any state law claim that grants relief for these breaches “‘duplicate[s], 

supplement[s], or supplant[s] the ERISA civil remedies.’” Girl Scouts, 770 F.3d at 419 (quoting 

Smith v. Provident Bank, 170 F.3d 609, 613 (6th Cir. 1999)). 

Plaintiffs argue that the breadth of ERISA’s preemption provision is limited and that 

federal courts have repeatedly held that common law breach of contract claims are not preempted 

under ERISA where the advocate of those claims is neither a “participant” nor “beneficiary” 

under the statute. They claim that because Superior Dairy cannot bring an action under ERISA, 

but remains a party to the Trust Agreement and Participation Agreement, its contract action 

cannot be preempted. However, Plaintiffs’ argument is unpersuasive. 

The Supreme Court has been clear that federal courts must look to the “objectives of the 

ERISA statute as a guide to the scope of the state law that Congress understood would survive.” 

N.Y. State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 

656 (1995). The purpose of ERISA preemption is to avoid conflicting federal and state 

regulation and to create a nationally uniform administration of employee benefit plans. Thus, 

ERISA preempts state laws that (1) “mandate employee benefit structures or their 

administration”; (2) provide “alternate enforcement mechanisms”; or (3) “bind employers or plan 

administrators to particular choices or preclude uniform administrative practice, thereby 

functioning as a regulation of an ERISA plan itself.” Penny/Ohlmann/Nieman, Inc. 399 F.3d at 

698 (quoting Coyne & Delany Co. v. Selman, 98 F.3d 1457, 1468 (4th Cir. 1996)). This has 

resulted, in limited scenarios, in courts concluding that breach of contract claims were not 

preempted by ERISA. 

However, in each such case, the conduct at issue did not actually relate to the ERISA plan 

in question. See, e.g., Marks v. Newcourt Credit Group, Inc., 342 F.3d 444, 453 (6th Cir. 2003) 

(finding that a breach-of-contract claim was not preempted where the conduct at issue was 

unrelated to the benefits plan but was related to an employment contract); Smith v. Provident 

Bank, 170 F.3d 609, 617 (6th Cir. 1999) (only where “an ERISA plan’s relationship with another 
No. 16-3124 Soehnlen, et al. v. Fleet Owners Ins., et al. Page 17

entity is not governed by ERISA, it is subject to state law”); Gerosa v. Savasta & Co., 329 F.3d 

317, 330 (2d Cir. 2003) (concluding that ERISA does not preempt plan’s state law claim against 

an actuary which resulted in severe underfunding of the ERISA plan); Ariz. State Carpenters 

Pension Trust Fund v. Citibank, 125 F.3d 715, 724 (9th Cir. 1997) (concluding that a plan could 

bring a state law claim for breach of custodial agreement against a bank as non-fiduciary service 

provider); Coyne & Delany Co., 98 F.3d at 1466, 1472 (holding that state malpractice claims 

against insurer for negligently failing to obtain replacement insurance plan was not preempted); 

Airparts Co. v. Custom Benefit Servs., 28 F.3d 1062, 1066 (10th Cir. 1994) (concluding that 

trustee’s common law suit against outside financial consultant is not preempted).

In contrast, Plaintiffs’ contract claims present a mere duplication of their ERISA 

arguments. In order to adjudicate the breach of contract claim, we would inevitably be 

evaluating whether or not any provision of ERISA was violated. It is impossible, therefore, to 

conclude that Plaintiffs’ breach of contract action is in any way distinguishable from their 

ERISA claims. Put another way, there is no way for us to resolve Plaintiffs’ contract claims 

without doubly reviewing their ERISA claims. Engaging in such analysis would be duplicative 

and thus we find the state law claims preempted.6

CONCLUSION

For the foregoing reasons, we AFFIRM the district court’s judgment. 

 6

To escape this conclusion the district court recast Plaintiffs’ arguments as challenges to either ERISA or 

the ACA and found that Plaintiffs failed to exhaust their administrative remedies. Both parties brief the issue to great 

length. However, we decline to recast Plaintiffs’ argument, instead taking them at their word, as expressed by their 

briefing, and do not address the matter of exhaustion.