The Honorable Richard K. Eaton, of the United States Court of International Trade, sitting *

by designation. 

** The Clerk of the Court is directed to amend the official caption of this action to conform

to the caption listed above.

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10-854-cv

Katzenberg v. Lazzari

UNITED STATES COURT OF APPEALS

FOR THE SECOND CIRCUIT

SUMMARY ORDER

Rulings by summary order do not have precedential effect. Citation to summary orders filed on or after

January 1, 2007, is permitted and is governed by Federal Rule of Appellate Procedure 32.1 and this

court’s Local Rule 32.1.1. When citing a summary order in a document filed with this court, a party

must cite either the Federal Appendix or an electronic database (with the notation “summary order”).

A party citing a summary order must serve a copy of it on any party not represented by counsel. 

At a stated term of the United States Court of Appeals for the Second Circuit, held at the

Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of New York, on

the 21 day of January, two thousand eleven. st

PRESENT:

JOSÉ A. CABRANES,

REENA RAGGI,

Circuit Judges,

RICHARD K. EATON,

Judge.*

- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - x

HARVEY KATZENBERG, 

Plaintiff–Counter-Defendant-Appellant,

 -v.- No. 10-854-cv

 

DERVAL LAZZARI, as Trustee of the Acme American Repairs,

Inc., Pension Trust, ACME AMERICAN REPAIRS, INC., ACME

AMERICAN REPAIRS, INC., PENSION TRUST,

Defendants-Counter-Claimants-Appellees.

**

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 The Honorable Charles R. Wolle, United States District Judge for the Southern District of 1

Iowa, sitting by designation.

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FOR PLAINTIFF-COUNTER-DEFENDANT-APPELLANT: DAVID B. GELFARB,

Moss & Kalish

PLLC, New York,

NY.

FOR DEFENDANTS-COUNTER-CLAIMANTS-APPELLEES: HELEN M. BENZIE

(Anthony Marino, of

counsel), Law Office of

Vincent D.

McNamara, East

Norwich, NY.

Appeal from a February 24, 2010, judgment of the United States District Court for the

Eastern District of New York (Charles R. Wolle, Judge).1

UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED,

AND DECREED that the judgment of the District Court be AFFIRMED. 

Plaintiff-Appellant Harvey Katzenberg—a former owner and executive of Acme American

Repairs, Inc. (“Acme”) and a participant in and former trustee of the Acme Pension Plan (“Acme

Plan”)—brought this action pursuant to Section 502 of the Employees’ Retirement Income Security

Act (“ERISA”), 29 U.S.C. § 1132, seeking an award of pension benefits, 29 U.S.C. § 1132(a);

sanctions resulting from the Acme Plan’s failure to provide him with a summary plan description

(“SPD”), 29 U.S.C. § 1132(c)(1); and an award for attorney’s fees, 29 U.S.C. § 1132(g). DefendantsAppellees raised several defenses and a counterclaim, all related to Katzenberg’s alleged breech of

fiduciary duties as a trustee of the Acme Plan. After a bench trial, the District Court entered

judgment in favor of defendants, concluding that (1) defendants’ defenses are not barred by

ERISA’s statute of limitations; (2) dismissing all of Katzenberg’s claims; and (3) denying attorney’s

fees to all parties. Katzenberg v. Lazzari, 04-cv-5100, 2010 WL 680985, at *7 (E.D.N.Y. Feb. 24,

2010). Katzenberg filed a timely appeal. We assume the parties’ familiarity with the facts and

procedural history of this case. 

I. Forfeiture Remedy

First, Katzenberg argues that the District Court erred in concluding that he should forfeit his

entitlement to benefits under the plan pursuant to 29 U.S.C. § 1109(a), which provides that a

fiduciary who breaches his duties under ERISA “shall be personally liable to make good to such

plan any losses to the plan resulting from each such breach . . . and shall be subject to such other 
3

equitable or remedial relief as the court may deem appropriate.” As we have frequently noted, it is

well-settled that ERISA grants the court broad discretion with respect to remedies under § 1109(a)

and that we review its decisions for abuse of discretion, Katsaros v Cody, 744 F.2d 270, 281 (2d Cir.

1984), taking into account “all the circumstances of the case,” Chao v. Merino, 452 F.3d 174, 185 (2d

Cir. 2006). “A district court has abused its discretion if it [has] based its ruling on an erroneous view

of the law or on a clearly erroneous assessment of the evidence, or rendered a decision that cannot

be located within the range of permissible decisions.” Sims v. Blot, 534 F.3d 117, 132 (2d Cir. 2008)

(citation, alterations, and quotation marks omitted).

Here, the record reflects that, in violation of federal law, Katzenberg repeatedly raided the

Acme Plan and overstated its value to minimize Acme’s required annual contribution. See 29 U.S.C.

§ 1104(a)(1); Varity Corp. v. Howe, 516 U.S. 489, 506 (1996); Central States, S.E. & S.W. Areas Pension

Fund v. Central Transp., 472 U.S. 559, 571 (1985) (“ERISA clearly assumes that trustees will act to

ensure that a plan receives all funds to which it is entitled, so that those funds can be used on behalf

of participants and beneficiaries.”). Contrary to Katzenberg’s claims, this Court has clearly

established that the “the power of the courts to fashion [the] equitable remedy” reached by the

District Court in this case—that is, a permanent injunction preventing the trustee from receiving

benefits under the plan—is not necessarily an abuse of discretion. United States v. Carson, 52 F.3d

1173, 1190 (2d Cir. 1995) (affirming the District Court’s decision to require a fiduciary to forfeit

benefits after breaching his duties). We therefore affirm the judgment of the District Court and

hold that when a fiduciary who is placed in a position of trust shows such contempt for the

beneficiaries to whom he owes a legal duty, the entry of a permanent injunction denying him his

benefits in order to make the fund whole is not an abuse of discretion. 

II. Statute of Limitations

Second, Katzenberg argues that—in determining that defendants’ affirmative defenses and

counterclaim are not barred under ERISA—the District Court improperly applied the six-year

statute of limitations under 29 U.S.C. § 1113 for cases of fraud or concealment, as opposed to the

three-year statute of limitations under § 1113(2). Katzenberg suggests that because he made no

effort to conceal his illegal activities, the statute of limitations ended three years after the errors were

discovered by his successor in 2001. This argument misconstrues ERISA. It is well settled that

fraud and concealment are distinct concepts with respect to 29 U.S.C. § 1113. That is, a trustee’s

conduct does not have to constitute fraudulent concealment under ERISA in order to trigger the

six-year statute of limitations. Caputo v. Pfizer, Inc., 267 F.3d 181, 190 (2d Cir. 2001) (“[T]he six-year

statute of limitations should be applied to cases in which a fiduciary: (1) breached its duty by making

a knowing misrepresentation or omission of a material fact to induce an employee/beneficiary to act

to his detriment; or (2) engaged in acts to hinder the discovery of a breach of fiduciary duty.”

(emphasis in original)). 
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In this case, whether or not he attempted to conceal his activities, the record supports the

District Court’s conclusion that Katzenberg—as trustee of the Acme Plan—knowingly misrepresented

the value of the plan and removed assets from the plan without authority or adequate

documentation, all in violation of ERISA. This conduct falls squarely within the language of § 1113

which states that “in the case of fraud . . . [an action with respect to a fiduciary’s breach of duty] may

be commenced not later than six years after the date of discovery of such breach.” See Caputo, 267

F.3d at 189 (citing Black’s Law Dictionary 670 (7th ed. 1999) (defining “fraud” as “[a] knowing

misrepresentation of the truth . . . to induce another to act to his or her detriment”)). Even

assuming, arguendo, that defendants’ second amended answer does not relate back to the filing of the

complaint or the initial answer, defendants’ affirmative defenses and counterclaims were timely filed

in May 2007 given that defendants did not discover Katzenberg’s breaches of fiduciary duties until

late 2001 at the earliest. We therefore hold that the District Court correctly determined that the sixyear statute of limitation does not bar defendants’ affirmative defenses and counterclaim in this case.

III. Summary Plan Description (SPD)

Third, Katzenberg argues that the District Court erred in concluding that “Katzenberg has

not proved anyone except Katzenberg himself violated ERISA” as a result of the Acme Plan’s

failure to have, much less distribute, an SPD, and in dismissing his claim for sanctions. Katzenberg,

2010 WL 680985, at *4. If the Acme Plan’s failure to have in its possession an SPD in accordance

with the requirements of 29 U.S.C. §§ 1021(a)(1), 1022(a) while Katzenberg was the trustee of the

plan constituted a violation of ERISA, then the Acme Plan’s subsequent (and continued) failure to

have an SPD after Katzenberg relinquished his duties as a trustee in 2001 is a violation of ERISA as

well. That is, however, not the end of our analysis under § 1132(c). 

It is well settled that a district court enjoys considerable discretion in deciding whether to

award ERISA sanctions pursuant to § 1132(c), and that we review such a decision for “abuse of

discretion.” See Demery v. Extebank Deferred Compensation Plan(B), 216 F.3d 283, 290 (2d Cir. 2000). In

this case, we find no abuse in the district court’s denial of sanctions. As the Supreme Court has

noted, the purpose of ERISA’s disclosure provisions are to ensure that “‘the individual participant

knows exactly where he stands with respect to the plan.’” Firestone Tire & Rubber Co. v Bruch, 489 U.S.

101, 118 (1989) (quoting H.R. Rep. No. 93-533, at 11 (1973)). We agree with the District Court that

Katzenberg— as the sole trustee with knowledge of the Plan for more than two decades—cannot

plausibly claim that, even after his departure from the company, he lacked the proper information to

know where he stood with respect to the plan. Accordingly, in the absence of any prejudice to

Katzenberg, see Devlin v. Empire Blue Cross & Blue Shield, 274 F.3d 76, 90 (2d Cir. 2001) (holding that

the absence of prejudice is an important factor to be considered by a court in exercising its

discretion against an award of sanctions), we cannot say that the District Court abused its discretion

in denying Katzenberg sanctions pursuant to § 1132(c) and dismissing his claim.
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IV. Attorney’s Fees

Finally, Katzenberg argues that the District Court erred in denying him attorney’s fees. We

review a decision to award fees under ERISA for abuse of discretion. See Chambless v. Masters, Mates

& Pilots Pension Plan, 815 F.2d 869, 871 (2d Cir. 1987). Even if the district court had wrongly

applied the five-factor test for determining when fees are appropriate as articulated in Chambless, the

Supreme Court has recently established that a party must achieve “some degree of success on the

merits” to earn fees under ERISA. Hardt v. Reliance Standard Life Ins. Co., 560 U.S. —-, 130 S. Ct.

2149, 2158 (2010) (internal quotation marks omitted). Accordingly, because Katzenberg achieved

no success on the merits, we cannot say that the District Court’s decision not to award attorney’s

fees was an abuse of discretion.

CONCLUSION

We have considered each of Katzenberg’s arguments on appeal and find them to be without

merit. For the reasons stated above, the judgment of the District Court is AFFIRMED.

FOR THE COURT

Catherine O’Hagan Wolfe, Clerk