Homer himself hath been observ'd to nod.
Plainly the fact that a union “continues to be a participating
Union” in an employee benefit plan (that is, to negotiate for its
members' employers to make plan contributions on their behalf
does not make the union itself a “participant” within the scope
of Section 1002(7)--by the unambiguous terms of the statute, that
category is expressly limited to individual participants (in that
instance, to the union's members). So that small slice of the
Douglas opinion, set out in such brief compass without any real
analysis, is not the type of actual holding to which this Court
is required to adhere when the issue is presented squarely (as it
was not in that case) ,’

By contrast, when nearly a decade after Douglas our Court of
Appeals was called on to address an effort of the same type
advanced by Union here--an effort to stretch the scope of ERISA
actionability beyond the boundaries set by Congress--~its answer
was an emphatic “No!” In light of Union's present contention,
Giardono v. Jones, 867 F.2d 409, 413 (7 Cir. 1989) (several

citations omitted) is worth quoting at length:

* From the opinion in Douglas it appears clear that the
issue that is in dispute here was not really raised there (and
hence was not discussed as such). What the parties were
quarreling about instead, and what occupied the Douglas court's
attention, was the existence or nonexistence of a “case or
controversy” in an action that sought to clarify the rights of
true plan participants (the union's members) to future benefits.

4


“fiduciary” under the plain terms of Section 1002(21) (A). Hence
that last potential string to Union's bow is also broken.
Rule 11 Motion

With Union's Complaint and this action thus required ta be
dismissed on jurisdictional grounds, as well as their being
subject to a second basis for dismissal if jurisdiction were
present, this opinion turns to Funds' motion for sanctions under
Rule 11. In the absence of a responsive memorandum from Union's
counsel, this Court has been required to consider that contention
on its own,

It must be said that Punds' position has force, most
particularly in light of what this Court has found to the clear
message conveyed by Giardono. Nonetheless, after full
consideration this Court has determined that Funds' Rule 11
invitation should be declined. Even though Union's counsel have
ultimately been unsuccessful, they were able to assemble some
snippets of authority that enabled Union's position to pass
muster as nonfrivolous (see Rule 11(b)2)): the statement from
the Seventh Circuit's earlier decision in Douglas, the footnote
dictum in Communications Workers and some language from other
cases cited in its responsive memorandum--from all of which an
argument could be cobbled together that passes the straight-face
test, though barely.

Accordingly Funds' Rule 11 motion is denied. It must he



Although in Russell the Court considered whether the
judiciary may imply a cause of action for extra-
contractual damages, as opposed to the precise issue at
bar, it nevertheless made it clear that the statutory
scheme of ERISA does not lend itself to judicial

expansion of available remedies. We hold that the

grant of subject matter jurisdiction in §1132(e) (1) is

exclusive. The courts are without the power to expand

their jurisdiction under ERISA in order to imply a

cause of action for non-enumerated parties.*

And importantly for present purposes, that ruling was an
express rejection of an employer's effort to take an end run
around the limitations imposed by Section 1132--a holding of
particular import in this case, where it must be remembered that
Union also attempts to sue in its capacity as an employer, not on
behalf of its members as such (as was true of the union's effort
in Douglas). Hence the brief expression from Douglas, sought to
be leaned on by Union, is no better than a weak reed that cannot
bear the weight of Union's argument against the far greater
adverse force of Giardono.

Next Union seeks to call on the doctrine of representational

standing, pointing to the decision in Hunt v. Washington State

Apple Adver. Comm'n, 432 U.S. 333, 343 (1977). Again it would

geem dubious at best to permit a carefully defined statutory

3 [Footnote by this Court] Funds' memoranda in support of

both of their motions cite extensively to other caselaw in other
courts to the same effect. But because this Court is of course
bound to follow the Seventh Circuit's jurisprudence and because
the Giardono precedent is so unequivocal, no useful purpose would
be served by larding this opinion with citations to added
authority from other courts.



Earlier this year, we had occasion to note the
existence of the split among the courts of appeals as
to whether the grant of jurisdiction in §1132(e) (1) is
exclusive..... The instant case places the issue
squarely before the court. If the grant of
jurisdiction is exclusive to the parties enumerated in
§1132(e) (1), then the district courts as well as this
court lack the subject matter jurisdiction to engage in
an analysis of whether standing is to be implied.

It is fundamental that the jurisdiction of the district
courts is limited and that the boundaries of the
jurisdiction are determined by Congress. Further, the
courts should not imply an additional private right of
action when a statute already has an elaborate
enforcement mechanism,

In Franchise Tax Board v. Construction Laborers
Vacation Trust, 463 U.S. 1, 21, 103 S.Ct. 2841, 2852,
77 L.Ed.2d 420 (1983), the Court stated:

The express grant of federal jurisdiction in
ERISA is limited to suits brought by certain
parties, see infra, [463 U.S.] at 25 [103
S.Ct. at 2854], as to whom Congress
presumably determined that a right to enter
federal court was necessary to further the
statute's purposes.

Further, in Massachusetts Mutual Life Insurance Co. v.
Russell, 473 U.S. 134, 146, 105 $.Ct. 3085, 3092, 87
L.Ed.2d 96 (1984), the Court elaborated on
congressional intent in the context of ERISA:

The six carefully integrated civil
enforcement provisions found in §502(a) of
the statute as finally enacted, however,
provide strong evidence that Congress did not
intend to authorize other remedies that it
simply forgot to incorporate expressly. The
assumption of inadvertent omission is
rendered especially suspect upon close
consideration of ERISA's interlocking,
interrelated, and interdependent remedial
scheme, which is in turn part of a
“comprehensive and reticulated statute.”
[emphasis in original]



only after that had taken place in any event. In the present
case Funds aiso assert that ripeness is absent because none of
the individual employees involved has exhausted his or her
administrative remedies (the same issue posed in Communications
Workers). And all Union offers in response is the irrelevancy
that it has no administrative remedies that require exhaustion,
because it has not filed any claim for benefits, nor has it been
denied benefits.

It takes only a moment's thought to see that such an
argument turns the notion of exhaustion of administrative
remedies on its head: Union claims to be entitled to sue on
behalf of its members, yet it somehow views the precondition to
its members' ERISA actions on their own behalf-~-their exhaustion
of administrative remedies--as immaterial. But exactly the
opposite is true: If Union purports to sue in a representational
capacity, its position can be on no better footing than those
whom it represents--so if a precondition to their suing has not
been met, Union cannot sue either.

In summary, Union's attempt to qualify under the
“participant” branch of ERISA, either frontally or through a side
entrance, fails on several fronts. And only a few words are
needed to torpedo its other effort to invoke ERISA--its attempt

to portray itself as an ERISA “fiduciary.” On that score Union's

relationship to Funds is patently insufficient to render it a



Minute Order Fors (06797)

Ay*0 United States District Court, Northern District of Illinois
Name of Assigned Judge Milton |, Shadur Sitting Judge if Other
or Magistrate Judge than Assigned Judge |
CASE NUMBER 02 C7279 DATE 1/22/2003
CASE County Municipal Employees’ vs. Laborers’ Pension Fund
riTLE

Lin the following hox (a) indicate the party filing the motion, c.g., plaintiff, defendant, 3rd party plaintiff, and (b) state briefly the nature
of the motion being presented.]

MOTION:

DOCKET ENTRY:

Q) a Filed motion of [ use listing in “Motion” box above.|

Q) Brief in support of motion due

GB) Answer brief to motion due___,_ Reply to answer briefdue___
(4) Ruling/Hearingon set for at

Status hearing held.

(6) Pretrial conference|held/continued to] [set tor/re-set for] on set for at .
(7) Trial[set for/re-set for] on al_
(8) |[Bench/Jury trial] [[learing| held/continued to _ atl

a
oondadm0od00

(9) This case is dismissed | with/without] prejudice and without costs[by/agreemenVpursuant to]

CFRCP4(m) CO Local Rule 41.1 COFRCP4((ay(1) 1 PRCP4L(a)(2).

(io) «= fOther docket entry] Enter Memorandum Opinion and Order. Defendants’ motion to dismiss is
granted. (6-1) Because Union has not suggested any basis on which it could cure what Giardono expressly
labels a lack of subject matter jurisdiction, this action is dismissed as well. At the same time, although
perhaps by a narrow margin, Union has escaped Rule 11 sanctions - - Funds’ motion on that score is
denied. (7-1)

(1) (Vor further detail see order attached to the original minute order. ]

No notices required, udvised in open court, Document

Number

\U

No notices required .
sue wf tices

| Notices mailed by judge's stalt. JAN 23 ongg

Nutified counsel by telephone,

slate donkered

Doeketing to mail notices.

Mail AQ) 450 form. THAAA pete 7 on

Copy to judge/magistrate judge.

Gadi ete spe g
SN deputy’s
initials

1
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central Clerk's Qiice

raniling deputy initials



aaid, though, that Union and its counsel ought to breathe a deep
sigh of relief on that score.
Conclusion

Union essentially seeks to rewrite the law, as unambiguously
spelled out by Congress, in its effort to bring this action under
the rubric of ERISA. It may perhaps be that Union could have
some non-ERISA remedy available to it, and it may also be
possible that some individuals who are not in this litigation
might be able to call upon ERISA to seek relief against Funds.
But the present posture of this action is one in which Funds seek
the dismissal of Union's Complaint, and for the reasons stated
here that motion is granted.

Because Union has not suggested any basis on which it could
cure what Giardono expressly labels a lack of subject matter
jurisdiction, this action is dismissed as well. At the same
time, although perhaps by a narrow margin, Union has escaped Rule

11 sanctions-- Funds' motion on that score is denied.

Cte lon Qotcedteer

Milton I, Shadur
Senior United States District Judge

Date: January 22, 2003

10



provision to be overridden by a general doctrine as to
standing--a doctrine that Congress has not chosen to incorporate
in ERISA'S meticulously framed statutory scheme. But Union also
calls attention to a footnote dictum in Communications Workers of
Am. v. AT&T, 40 F.3d 426, 434 n.2 (D.C. Cir. 1994) stating the
possibility that, under the circumstances described there, a
union would in the future acquire such representational standing
to sue on behalf of its members.

That stated potential, however, is also unpersuasive in this
case (even apart from the fact and the brevity of the
Communications Workers dictum). Again more than one
consideration undercuts Union's position.

For one thing, even if that brief conclusory dictum were to
be elevated to the level of a holding, it would still stand at
most for the proposition that a union could have standing to
advance the interests of its members. And just as has been said
regarding Douglas, that notion cannot prevail in the face of
Giardono's rejection of any ERISA action under Section 1132 by a
plaintiff (such as Union here) that sues qua employer.

Second, even the limited force of the Communications Workers
footnote is vitiated by the case's actual holding: a decision
that the employees involved there had failed to exhaust their
administrative remedies and were required to do so, so that the

dictum about the union's potential standing could come into play



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.

It is apparent that Union fits neither of those two Section
1002 definitions (either “participant” or “fiduciary”) as framed
by Congress. But even though such specific statutory definitions
of terms used elsewhere in the same statute would normally make
those defined words terms of art to be read precisely as written,
Union seeks to call upon some limited language in some judicial
opinions as seemingly expanding (or perhaps as redefining) what
Congress has itself said.

To that end Union points primarily to a brief statement in
Int'l Ass'n of Bridge, Structural & Ornamental Iron Workers Local
No. 111 v. Douglas, 646 F.2d 1211, 1214 (7 Cir. 1981), where
the court said as to a plaintiff union that had brought suit on

behalf of its members regarding plan benefits:

Local 111 has not withdrawn from the Plan but rather
continues to be a participating Union.

That statement was then followed by the court's quotation of
Section 1132(a) (1) (B) (which allows a “participant...to clarify
his rights to future benefits under the terma of the plan”),
followed in turn by the court's statement that Local 111 was
seeking such a clarification of the rights of its members to
benefits under the terms of the plan.

But as Horace said in Ars Poetica, line 402:



plaintiffs who are qualified to bring such ERISA actions, by
asserting that the terms “participant” and “fiduciary” (two of
the three classes of eligible plaintiffs under Section

1132 (a) (3)) should be read broadly enough to embrace Union. That
being so, the springboard for discussion must begin with the
Statutory definitions of those terms in Sections 1002(7) and

1002 (21) (A) respectively:

The term “participant” means any employee or former
employee of an employer, or any member or former member
of an employee organization, who is or may become
eligible to receive a benefit of any type from an
employee benefit plan which covers employees of such
employer or members of such organization, or whose
beneficiaries may be eligible to receive any such
benefit.

Except as otherwise provided in subparagraph (B), a
person is a fiduciary with respect to a plan to the
extent (i) he exercises any discretionary authority or
discretionary control respecting management of such
plan or exercises any authority or control respecting
Management or disposition of its assets, (ii) he
renders investment advice for a fee or other
compensation, direct or indirect, with respect to any
moneys or other property of such plan, or has any
authority or responsibility to do so, or (iii) he has
any discretionary authority or discretionary
responsibility in the administration of such plan.
Such term includes any person designated under section
1105(¢) (1) (B) of this title.

And here is the ERISA provision (Section 1132(a) (3))under which
Union claims authorization to bring this lawsuit:
A civil action may be brought --

* * *

(3) By a participant, beneficiary, or
fiduciary (A) to enjoin any act or practice which



IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
EASTERN DIVISION

COUNTY, MUNICIPAL EMPLOYEES'
SUPERVISORS AND FOREMAN'S UNION
LOCAL NO, 16001,
Plaintiff,
Vv.

No. 02 € 7279

LABORERS' PENSION FUND, et al.,

Defendants.
MEMORANDUM OPINION AND ORDER

Defendant employee benefit funds (collectively “Funds”) have
moved to dismiss the Complaint brought against them by County,
Municipal Employees' Supervisors and Foreman's Union Local No.
1001 (“Union”), which seeks declaratory relief on behalf of
certain Union officers under the auspices of ERISA.’ By a
separate motion, Funds also seek sanctions under Fed. R. Civ. P.
(’Rule”) 11 “for filing a Complaint that is unwarranted under
existing law and that has no proper purpose” (Rule 11 Motion at
1). This memorandum opinion and order is issued to address the
issues as focused by Funds! motions and by Union's recently-filed
response to the dismissal motion.

Motion To Dismiss
Essentially Union seeks to avoid the literal application of

Section 1132(a) (3), as to its designation of the categories of

2 Citations to ERISA will take the form “Section --,” using
the statutory numbering within Title 29 rather than ERISA's
internal section numbering.