The Fund’s complaint asserts one count, seeking to enforce the terms of the Fund
documents pursuant to ERISA § 502(a)(3). (Compl., {| 27-32, ECF No. 1.) ERISA §
502(a)(3)(B)(ii) provides that a “civil action may be brought by a plan fiduciary ... to obtain
other appropriate equitable relief ... to enforce ... the terms of the plan.” 29 U.S.C. §
1132(a)(3). The Fund asserts that it relies “on the equitable relief provided by ERISA §
502(a)(3), along with the Subrogation and Reimbursement Agreement and the Subrogation and
Reimbursement provision in the Fund’s governing document for their demand for equitable
relief.” (Pl.’s Mot. S.J. at p. 5, ECF No. 22.) Additionally, the Fund asserts that “[t]he
Subrogation and Reimbursement provision in the Fund’s governing document satisfies the
requirements of an equitable lien by agreement.” (/d.)

A. The Plan Sets Forth an Equitable Lien by Agreement

The Fund’s Rules and Regulations (the “Plan”) “were originally adopted effective
January 1, 1984 by the Trustees of the UFCW [United Food and Commercial Workers] Local
Unions and Employers Benefit Plan of the Southwestern Ohio Area under the Plan's Trust
Agreement to establish the Rules and Regulations determining the eligibility of Employees for
the health and welfare benefits to be provided by the Plan and to prescribe the amount, extent,
conditions and method of payment of such benefits.” (PI. 's Mot. S.J., Ex. H, Heartland Health &
Wellness Fund Rules and Regulations, p. 1, ECF No. 22-8.)

The Plan sets forth the duties and authorities of the Plan’s Trustees. These duties include
carrying out the obligation “to maintain, within the limits of the funds available to them, a sound
and economical program dedicated to providing the maximum benefits for eligible Employees

and Dependents ....” (/d.) The Fund contends that it has a right to recover benefits paid by a

ECF No. 23-2.) There is no additional evidence in the record in support of this assertion that
would be sufficient for any reasonable jury to find that detrimental reliance was established.


The result we reach, based on the historical analysis our prior cases prescribe, fits
lock and key with ERISA's focus on what a plan provides. The section under
which this suit is brought “does not, after all, authorize ‘appropriate equitable
relief at large,” Mertens, 508 U.S., at 253, 113 S.Ct. 2063 (quoting §
1132(a)(3)); rather, it countenances only such relief as will enforce “the terms of
the plan” or the statute, § 1132(a)(3) (emphasis added). That limitation reflects
ERISA's principal function: to “protect contractually defined benefits.”
Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 148, 105 S.Ct. 3085,
87 L.Ed.2d 96 (1985). The statutory scheme, we have often noted, “is built around
reliance on the face of written plan documents.” Curtiss-Wright Corp. v.
Schoonejongen, 514 U.S. 73, 83, 115 S.Ct. 1223, 131 L.Ed.2d 94 (1995). “Every
employee benefit plan shall be established and maintained pursuant to a written
instrument,” § 1102(a)(1), and an administrator must act “in accordance with the
documents and instruments governing the plan” insofar as they accord with the
statute, § 1104(a)(1)(D). The plan, in short, is at the center of ERISA. And
precluding McCutchen's equitable defenses from overriding plain contract terms
helps it to remain there.

Jd., at 101. However, the Supreme Court found that the U.S. Airways plan did not specifically
address attorney’s fees, and so McCutchen was able to prevail on his common-fund doctrine
defense. “Only if U.S. Airways’ plan expressly addressed the costs of recovery would it alter the
common-fund doctrine.” McCutchen, 569 U.S. at 105. In the case at bar, the terms of the Plan
are clear. The plain language unambiguously sets forth an equitable lien by agreement, and
forecloses the application of the equitable defenses asserted by Defendants.

Plaintiff also prays for an award of reasonable attorney’s fees and costs, pursuant to 29
U.S.C. § 1132(g)(1) “and in accordance with the ‘Subrogation and Reimbursement’ provision of
the Fund’s Rules and Regulations (Section 7.6).”

The plaintiff's request for attorney’s fees comes with a tinge of irony. The plaintiff is
required to pay for the medical bills of Ms. Billeter, regardless of whether a third party tortfeasor
may also be liable for the same medical expenses. Ms. Billeter, through her attorneys, has
received a settlement in excess of such amounts. The plaintiff demands a 100% recovery of the

payments it has made, even though the upshot will be that Ms. Billeter’s contingent fee

10


(Id., p.

reimbursement rights apply to any recovery by the Person without regard to legal fees and
expenses of the person” “unless the Trustees, in their sole discretion, have agreed in writing to

discount the Plan's claim by an agreed upon amount of such fees or expenses.” Furthermore, the

The Trustees may also require the Person to execute a Subrogation and
Reimbursement Agreement ("Agreement"), in a form provided by and acceptable
to the Trustees, as a condition to receiving benefits for a claim. The Plan has the
right to suspend all benefit payments if the Agreement is not executed by the
Person or if the Agreement is modified in any way by the Person without the
consent of the Plan. If the Person is a minor or is incompetent to execute the
Agreement, that person's parent, the Person (in the case of a minor dependent
child), the Person's spouse, or legal representative (in the case of an incompetent
adult) must execute the Agreement upon request of the Plan. If the Plan, in its
sole discretion, advances claims payments in the absence of an Agreement, or if
the Plan advances claims payments in error, said payments will not waive,
compromise, diminish, release or otherwise prejudice any of the Plan's rights to
reimbursement or subrogation. A Person must comply with all terms of the
Agreement, including the establishment of a trust for the benefit of the Plan. In
this regard, the Person agrees that the amount that the Plan has advanced or is
obligated to advance in benefits received from any source will be immediately
deposited into a trust for the Plan's benefit and the Plan shall have an equitable
lien by agreement that shali be enforceable under legal, equitable and/or
injunctive action to ensure that these amounts are preserved and not disbursed.
The Plan's subrogation and reimbursement rights shall apply regardless of
whether the Person executes the Agreement.

VII-23)(emphasis added.)

The Plan Unambiguously Requires a Person to Pay their own Attorney’s
Fees, and Disavows Common Law Defenses

Further, the Plan clearly and unambiguously provides that “the Plan’s subrogation and

Plan clearly disavows common law defenses:

(iv) Person's Attorney's Fees. The Plan's subrogation and reimbursement rights
apply to any recovery by the Person without regard to legal fees and expenses of
the Person. The Person shall be solely responsible for paying all legal fees and
expenses in connection with any recovery for the underlying injury, illness,
sickness, accident or condition, and the Plan's recovery shall not be reduced by
such legal fees or expenses, unless the Trustees, in their sole discretion, have
agreed in writing to discount the Plan's claim by an agreed upon amount of
such fees or expenses.

(v)  Disavowal of Common Law Defenses. The Plan specifically disavows any
claims that a Person may make under any federal or state common law defense,



third party that is legally responsible for medical payments. The Plan sets forth its rights to

subrogation and reimbursement in Section 7.6(c):

(i) Plan's Rights to Subrogation and Reimbursement. The Plan shall be entitled to

subrogation or reimbursement with regard to all rights of recovery of a Person,
or representatives, guardians, beneficiaries, fiduciaries, trustees, estate
representatives, heirs, executors, administrators of any special needs trust, and
any other agents, persons or entities that may receive a benefit on behalf of the
Person (collectively for purposes of this section 7.6(c), "Person"), to the extent
of any amounts which the Plan has paid or may become obligated to pay on.
account of any claim against any person, organization or other entity in
connection with the injury, illness, sickness, accident or condition to which the
claim relates ("Source"). A Source includes, but is not limited to, a responsible
party and/or a responsible party's insurer (or self-funded protection), no-fault
protection, personal injury protection, medical payments coverage, financial
responsibility and any employer of the Person under the provisions of a
Worker's Compensation or Occupational Disease Law. The Plan shall also be
entitled, to the extent of payments made or to be made on account of the claim,
to reimbursement from the proceeds of any settlement, judgment or payments
from any Source that may result from the exercise of any rights of recovery by
the Person. Such subrogation and reimbursement rights shall apply on a
priority, first dollar basis to any recovery whether by suit, settlement or
otherwise, whether there is a partial or full recovery and regardless of whether
the Person is made whole and shall apply to any and all amounts of recovery
regardless of whether the amounts are characterized or described as medical
expenses or as amounts other than for medical expenses and regardless of
whether liability is admitted or contested by the Source. Once the Plan makes
or is obligated to make payments on behalf of a Person on account of the
claim, the Plan is granted, and the Person consents to, an equitable lien by
agreement or a constructive trust on the proceeds of any payment, settlement
or judgment received by the Person from any Source. The Plan shall have no
right of subrogation or reimbursement against an insurance carrier arising out
of an individual policy of insurance maintained by a Person, except for a
policy which provides "no-fault" automobile insurance. The Plan will not pay
benefits in excess of $2,500 on behalf of any Person if such Person does not
pursue his own rights of recovery to which he may be entitled from any
individual, organization or other entity in connection with the injury.

(Id., p. VII-22)(emphasis added.)

Additionally, in Section 7.6(c)(ii), the Plan states that it may also require the execution of
a Subrogation and Reimbursement Agreement, but the rights to subrogation attach regardless of

whether the separate agreement is executed:


equitable defenses must yield when the plan’s documents establish an equitable lien; and that
lien may be asserted against the person’s attorney, even though the attorney is not a party to the
plan. J/d., at 468. A split developed among the federal circuit courts as to whether equitable
defenses could trump the equitable lien language of a plan’s reimbursement clause.” The split
was settled by the Supreme Court in U.S. Airways, Inc. v. McCutchen, 569 U.S. 88, 133 S.Ct.
1537 (2013). In McCutchen, an employer providing a self-funded health benefits plan to its
employees brought an ERISA § 502(a)(3) suit against a plan beneficiary who had been injured in
an automobile accident, received medical treatment paid for by the plan, and later recovered
money from an insurer and the driver who was at fault in the accident. The Supreme Court
examined “whether, in that kind of suit, a plan participant like McCutchen may raise certain
equitable defenses deriving from principles of unjust enrichment.” McCutchen, 569 U.S. at 91.
In particular, we address one equitable doctrine limiting reimbursement to the
amount of an insured’s ‘double recovery’ and another requiring the party seeking
reimbursement to pay a share of the attorney’s fees incurred in securing funds

from the third party. We hold that neither of those equitable rules can override
the clear terms of a plan.

Td.
Plaintiff asserts that the McCutchen decision is on point and governs the case at bar.

(P1.’s Mot. S.J., p. 8, ECF No. 22.) Briefly, the Supreme Court held that, “in an action brought
under § 502(a)(3) based on an equitable lien by agreement, the terms of the ERISA plan govern.
Neither general principles of unjust enrichment nor specific doctrines reflecting those principles
— such as double-recovery or common-fund rules — can override the applicable contract.”

McCutchen, 569 U.S. at 106. The Court explained that:

2 A thorough discussion of issues surrounding ERISA reimbursement clauses and equitable
defenses is presented in Professor Medill’s law review article. See Colleen E. Medill and Alyssa
M. Stokes, ERISA Subrogation Afier Montanile, 95 Neb. L. Rev. 603, 617 (2016).


UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION
HEARTLAND HEALTH &
WELLNESS FUND,
Case No. 2:17-ev-214
Plaintiff, CHIEF JUDGE EDMUND A. SARGUS, JR.

Magistrate Judge Kimberly A. Jolson
v.

JANET L. BILLETER, et al.,

Defendants.

OPINION AND ORDER

This matter is before the Court on Defendants’ Motion for Summary Judgment (ECF No.
21), to which Plaintiff has filed a memorandum in opposition (ECF No. 23). Plaintiff has also
filed a Motion for Summary Judgment (ECF No. 22), to which Defendants have filed a
memorandum in opposition (ECF No. 25). Plaintiffs have also filed a Motion for Leave to file a
Sur-reply (ECF No. 27) and a Motion to Strike (ECF No. 28). The motions are ripe for
consideration. For the reasons that follow, Defendants’ Motion for Summary Judgment is
DENIED as MOOT, Plaintiff's Motion for Summary Judgment is GRANTED, and Plaintiff's

motions for leave to file a sur-reply and to strike are DENIED as MOOT.
I. BACKGROUND
Plaintiff in this lawsuit, Heartland Health & Wellness Fund (“Plaintiff’ or the “Fund”) is

a self-funded multiemployer fund “established and maintained pursuant to the Labor-
Management Relations Act of 1947, § 302(c)(5), 29 U.S.C. § 186(c)(5) (“LMRA”).” (Compl.
94, ECF No. 1.) This suit is brought on the Fund’s behalf by Henry B. Taylor and Joe
Chorpenning, in their capacity as trustees. (/d., at p. 1.) The Fund is governed by the Employee
Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001, et. seg. (/d., J 1.)

The Defendants in this lawsuit are Janet L. Billeter and her attorneys, Bordas & Bordas,


IV. CONCLUSION
For the reasons stated above, the Fund’s Motion for Summary Judgment (PI. ’s Mot. S.J.,
ECF No. 22) is GRANTED. The Fund is entitled to judgment on Count One of its Complaint
(Compl., ECF No. 1) in the amount of $712,761.51. Defendants’ Motion for Summary Judgment
(Def,’s Mot. S.J., ECF No. 21) is DENIED as MOOT. Plaintiff's motion for attorney’s fees is

DENIED. Plaintiffs remaining motions (ECF Nos. 27, 28) are also DENIED as MOOT. The

Clerk is DIRECTED to enter judgment in this case.

IT IS SO ORDERED.
4 -l-s008 Ln
DATE ED) . SARGUS, JR.
CHIEF ED STATES DISTRICT JUDGE

12


agreement requires her to pay from her own recovery a percentage of the $712,761.51 she now
owes the fund.

29 U.S.C. § 1132(g)(1) is designed to make whole a fund that expends attorney’s fees to
recover monies owed. Here, the fund recovered 100% of its payments from a defendant who has
basically paid part of her recovery to make the fund whole. Section 1132(g)(1) provides that
“the court in its discretion may allow a reasonable attorney’s fee and costs of action to either
party,”

As explained above in McCutcheon, the Supreme Court held that, given the language of
an ERISA plan providing for full recovery of subrogated benefits, the fund was not subject to
equitable defenses. Yet, the Court also was quite clear that “No one can doubt that the common-
fund rule would govern here in the absence of a contrary agreement.” Jd., at 104. In other
words, since Ms. Billeter paid money to gain funds for herself and the Fund, she would be
entitled to reimbursement for a proportionate share owed to the plaintiff. The Plan gives the
Fund the power to demand a 100% recovery — not so with additional attorney’s fees.

The Court finds that, given the 100% recovery of the plaintiff, an imposition of additional

attorney’s fees on the defendant would be manifestly unjust.

11


including, but not limited to, the common fund doctrine, the double-recovery rule,
the make-whole doctrine or any similar doctrine or theory, including the
contractual defense of unjust enrichment. Accordingly, the Plan's subrogation and
reimbursement rights apply on a priority first-dollar basis to any recovery of the
Person from any Source without regard to legal fees and expenses of the Person
and the Person will be solely responsible for paying all legal fees and expenses.
The Plan shall have a priority, first-dollar security interest and a lien on any
recovery received from any Source, whether by suit, settlement or otherwise,
whether there is a full or partial recovery and regardless of whether the amounts
are characterized or described as a payment for medical expenses or as amounts
other than for medical expenses of such injury, illness, sickness, accident or

condition.
(d., VII-24)(emphasis added.)

C. Discussion

ERISA reimbursement claims must be brought in federal district court under section
502(a)(3) as claims for “appropriate equitable relief.” 29 U.S.C. § 1132(a)(3). The Supreme
Court interpreted the meaning of “appropriate equitable relief” in the context of a reimbursement
claim in Great-West Life & Annuity Insurance Co. v. Knudson, 534 U.S. 204, 210-11 (2002), and
explained that an action under section 502(a)(3) to enforce a reimbursement clause excluded
monetary damages, and excluded an injunction or an order of mandamus to compel the payment
of money to the plan out of the participant’s general assets. Rather, “equitable relief” refers to
“those categories of relief that were typically available in equity. . . .” (/d., at 210.) “Thus, for
restitution to lie in equity, the action generally must seek not to impose personal liability on the
defendant, but to restore to the plaintiff particular funds or property in the defendant’s
possession.” (Jd., at 210.) In Sereboff v. Mid Atlantic Medical Services, Inc., 547 U.S. 356

(2006), the Court explained that a claim to enforce a contractual promise as an equitable lien is a

form of equitable relief.
The Sixth Circuit, in Longaberger Co. v. Kolt, 586 F.3d 459, 463 (6th Cir. 2009),

abrogated on other grounds, Montanile v. Board of Trustees, 136 S.Ct. 651 (2016) held that


weighing evidence). Furthermore, the existence of a mere scintilla of evidence in support of the
nonmoving party’s position will not be sufficient; there must be evidence on which the jury
reasonably could find for the nonmoving party. Anderson, 477 U.S. at 251; see Copeland v.
Machulis, 57 F.3d 476, 479 (6th Cir. 1995); see also Matsushita, 475 U.S. at 587-88 (finding
reliance upon mere allegations, conjecture, or implausible inferences to be insufficient to survive
summary judgment).
Il. SUMMARY JUDGMENT

Although there are cross motions for summary judgment, the Court addresses the Plan’s
motion first. In view of this approach, the Court treats Defendants as the non-movants with
respect to the evidence in the record. As discussed in more detail below, the Court grants the
Fund’s motion for summary judgment because the terms of the plan are clear and they foreclose
the application of the equitable defenses asserted by Defendants, and because Defendants’
remaining arguments are not sufficiently supported by evidence in the record. The Court also
denies as moot Defendants’ motion for summary judgment, which raises largely the same
arguments as Defendants’ opposition brief and which introduces no additional evidence that
would support a different decision. Likewise, the Fund’s motion for leave to file a sur-reply

and motion to strike are denied as moot.

1 Defendants’ motion for summary judgment asserts several arguments, including equitable
arguments that are precluded. (Def 's Mot. S.J., ECF No. 21.) They also assert that Ms. Billeter
did not actually sign the separate subrogation agreement. Taken as true, it is of no moment,
because the language of the Plan set forth in detail in the Opinion below specifically states that
“the Plan's subrogation and reimbursement rights shall apply regardless of whether the Person
executes the [separate] Agreement.” Defendants also assert that the amount of the reimbursement
was not properly calculated using insurance codes, but this assertion is not sufficiently supported
by the evidence in the record. (/d., pp. 4-7.) Additionally, Defendants assert that they relied to
their detriment on a letter from the Fund’s law firm dated October 17, 2016, advising that the
lien had been reduced by the Fund’s stop loss coverage, such that the remaining lien amount due
is $520,9990.59. (/d., pp. 12-13.) However, the letter itself directs Defendants to “contact us to
confirm the total amount of the Fund’s subrogated interest before resolving this matter.” (Letter,


The Fund asserts that the Supreme Court’s decision in U.S. Airways, Inc. v. McCutchen,
569 U.S. 88, 133 S.Ct. 1537 (2013), is on point and governs the case at bar. (Pl. ’s Mot. S.J., p. 8,
ECF No. 22.) The Fund’s assertion is well taken. This case is similar to McCutchen in all
material respects except one. In this case, the plain language of the Plan disavowing the
common-fund doctrine Defendants seek to impose is unambiguous, and leaves no room for
equitable defenses to operate.

I. STANDARD OF REVIEW

Summary judgment is appropriate “if the movant shows that there is no genuine dispute
as to any material fact and the movant is entitled to judgment as a matter of law.” Fed. R. Civ. P.
56(a). The movant has the burden of establishing that there are no genuine issues of material
fact, which may be accomplished by demonstrating that the nonmoving party lacks evidence to
support an essential element of its case. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986);
Barnhart v. Pickrel, Schaeffer & Ebeling Co., 12 F.3d 1382, 1388-89 (6th Cir. 1993). To avoid
summary judgment, the nonmovant “must do more than simply show that there is some
metaphysical doubt as to the material facts.” Matsushita Elec. Indus. Co. v. Zenith Radio Corp.,
475 U.S. 574, 586 (1986); accord Moore v. Philip Morris Cos., 8 F.3d 335, 340 (6th Cir. 1993).
“(S]ummary judgment will not lie if the dispute about a material fact is ‘genuine,’ that is, if the
evidence is such that a reasonable jury could return a verdict for the nonmoving party.”
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). In evaluating a motion for summary
judgment, the evidence must be viewed in the light most favorable to the nonmoving party.
Adickes v. S.H. Kress & Co., 398 U.S. 144, 158-59 (1970); see Reeves v. Sanderson Plumbing
Prods., Inc., 530 U.S. 133, 150 (2000) (stating that the court must draw all reasonable inferences

in favor of the nonmoving party and must refrain from making credibility determinations or


PLLC (collectively “Defendants”). Ms. Billeter was an enrollee in the Fund at the time that she
sustained serious injuries in an accident on January 9, 2015, when she was struck as a pedestrian
by a tractor trailer. (Compl., {§ 7-9, ECF No. 1.) “These injuries included fractures of the neck,
back, pelvis, ribs and left arm, a collapsed lung, a lacerated liver, and a severed right arm from
the shoulder and numerous surgeries.” (Def.’s Mot. S.J., ECF No. 21, p. 1.) The Fund alleges
that, since the time of the accident, it “has paid $712,761.51 in medical treatment benefits for
Defendant Billeter.” (Compl., | 9, ECF No. 1.)

Ms. Billeter subsequently sued the driver of the tractor trailer and several entities to
recover for the injuries that she suffered. (P/.’s Mot. S.J., Ex. B., ECF No. 22-2.) She was
represented by Bordas & Bordas, PLLC, co-defendant in this action. (Compl., ECF No. 1, ¥ 10.)
The Fund alleges that “sometime between January and March 2017 Defendants settled the
personal injury claim for approximately $10,000,000.” (/d., § 11.)

The Fund brings this suit “for equitable relief to enforce the terms and preserve the assets
of an employee welfare benefit Fund’s subrogation and reimbursement rights under the terms of
the governing Fund documents through imposition of an equitable lien by agreement or a
constructive trust on funds received or to be received by Defendant from a third party, pursuant
to ERISA § 502(a)(3), 29 U.S.C. § 1132(a)(3).” (Compl., § 1, ECF No. 1.) The Fund asserts that
it is entitled to receive “the remaining reimbursement of the $712,761.51 that the Fund paid out
of a self-funded trust as medical benefits for Defendant Billeter from the funds received or to be
received in the personal injury settlement.” (/d., 4 25.) The funds at issue, $712,761.51, are
maintained in a trust account by counsel Bordas & Bordas, PLLC. (See Compl., J15, ECF No. 1;

Amended Answers of Janet L. Billeter (ECF No. 11, 15) and Bordas & Bordas, PLLC (ECF

No. 10, ¥15)).