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No. 12-35458 

IN THE UNITED STATES COURT OF APPEALS 

FOR THE NINTH CIRCUIT 

GREGORY R. GABRIEL, 

Plaintiffs-Appellants 

v. 

ALASKA ELECTRICAL PENSION FUND, et al., 

Defendants-Appellees 

Appeal from the United States District Court 

For the District of Alaska, 

Honorable Timothy M. Burgess 

Case No. 3:06-cv-00192-TMB 

BRIEF OF THE SECRETARY OF LABOR, AS AMICUS CURIAE 

IN SUPPORT OF PETITION FOR REHEARING 

OR REHEARING EN BANC 

M. PATRICIA SMITH 

 Solicitor of Labor 

G. WILLIAM SCOTT 

Associate Solicitor, Plan Benefits 

Security Division 

ELIZABETH HOPKINS 

Counsel for Appellate and Special 

Litigation 

U.S. Department of Labor 

Office of the Solicitor 

P.O. Box 1914 

Washington, D.C. 20013 

(202) 693-5584 
TABLE OF CONTENTS
 

TABLE OF AUTHORITIES .................................................................................... ii 

BACKGROUND AND INTEREST OF THE SECRETARY OF LABOR .............1 

ARGUMENT.............................................................................................................2 

EQUITABLE RELIEF UNDER ERISA SECTION 502(a)(3) INCLUDES 

MONETARY RELIEF THAT MAKES INJURED PLAN PARTICIPANTS 

AND THEIR BENEFICIARIES WHOLE ................................................................2 

A.	 Amara allows monetary relief for participant losses caused by 

fiduciary breach.....................................................................................2 

B.	 Decisions from the Fourth, Fifth, and Seventh Circuits confirm that 

equitable relief under section 502(a)(3) includes make-whole relief 

for participant and beneficiary losses ....................................................5 

C.	 The law of equity confirms the availability of such relief ....................9 

D. ERISA's structure and purpose underscore that the statute allows suits 

by participants and beneficiaries to recover their own losses 

attributable to fiduciary breaches ........................................................11 

CONCLUSION .......................................................................................................15 

CERTIFICATE OF SERVICE 

CERTIFICATE OF IDENTICAL COMPLIANCE 

OF BRIEFS AND VIRUS CHECK 
 

TABLE OF AUTHORITIES 

Federal Cases: Page 

Aetna Health Inc. v. Davila, 

542 U.S. 200 (2004)(Ginsburg,J., joined by Breyer, J.concurring) .......... 14 

Amschwand v. Spherion Corp., 

505 F.3d 342 (5th Cir. 2007) ....................................................................... 7 

Cicio v. Does 1-8, 

321 F.3d 83 (2d Cir. 2003)(Calabresi, J., dissenting in part), 

vacated in part,542 U.S. 933 (2004) .......................................................... 14 

CIGNA Corp. v. Amara, 

131 S.Ct. 1866 (2011) ................................................................. 1 & passim 

DiFelice v. Aetna U.S. Healthcare, 

346 F.3d 442 (3d Cir. 2003)(Becker, J., concurring) ................................ 14 

Eichorn v. AT&T Corp., 

489 F.3d 590 (3d Cir. 2007) 

(Ambro,J., concurring in denial of petition for rehearing en banc) .......... 14 

Gabriel v. Alaska Elec. Pension Fund,

 -- F.,3d --, 2014 WL 2535469 (9th Cir. June 6, 2014) ........................... 1, 2 

Gearlds v. Entergy Servs., Inc., 

709 F.3d 448 (5th Cir. 2013) ................................................................... 5, 7 

Griggs v. E.I. DuPont de Nemours & Co., 

237 F.3d 371 (4th Cir. 2001) ..................................................................... 12 

Kendall v. DeForest, 

101 F. 167 (2d Cir. 1900) .......................................................................... 11 

Kenseth v. Dean Health Plan, Inc., 

722 F.3d 869 (7th Cir. 2013) ................................................................... 5, 8 

ii 
Federal Cases--(continued) Page 

Lind v. Aetna Health Inc., 

466 F.3d 1195 (10th Cir. 2006) ................................................................. 14 

McCravy v. Metropolitan Life Ins. Co., 

690 F.3d 176 (4th Cir. 2012) ............................................................... 5, 6, 7 

McFadden v. R&R Engine & Mach. Co., 

102 F. Supp. 2d 458 (N.D. Ohio 2000) ..................................................... 12 

Mertens v. Hewitt Assocs., 

508 U.S. 248 (1993) .............................................................................. 3, 11 

Mosser v. Darrow, 

341 U.S. 267 (1951) .................................................................................. 10 

Peralta v. Hispanic Bus., Inc., 

419 F.3d 1064 ( 9th Cir. 2005) .............................................................. 4, 14 

Pereira v. Farace, 

413 F.3d 330 (2d Cir. 2005)(Newman, J. concurring) .............................. 14 

Princess Lida of Thurn & Taxis v. Thompson,
 

305 U.S. 456 (1939) .................................................................................. 10 

Strom v. Goldman Sachs & Co., 

202 F.3d 138 (2d Cir. 1999) ...................................................................... 12 

United States v. Mason, 

412 U.S. 391 (1973) .................................................................................. 10 

Varity v. Howe, 

516 U.S. 489 (1996) ............................................................................ 12, 13 

State Case: 

Gates v. Plainfield Tr. Co., 

194 A. 65 (N.J. 1937) ................................................................................ 11 

iii
 
 

 					

 

Federal Statutes: Page 

Employee Retirement Income Security Act of 1974, Title I 

as amended, 29 U.S.C. 1001 et seq.: 

Section 502(a)(3), 29 U.S.C. § 1132(a)(3) .................................. 1 & passim 

 Section 2, 29 U.S.C. § 1001 ........................................................................ 1 

Section 2(b), 29 U.S.C. § 1001(b) ....................................................... 11, 13 

Section 3(13), 29 U.S.C. § 1002(13) ........................................................... 2 

Section 3(21)(A), 29 U.S.C. § 1002(21)(A) .............................................. 11 

Section 409, 29 U.S.C. § 1109 .................................................................... 8 

Section 409(a), 29 U.S.C. § 1109(a) ........................................................... 8 

Section 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B) ................................... 2, 3 

Section 502(a)(2), 29 U.S.C. § 1132(a)(2) .................................................. 8 

Section 506(b), 29 U.S.C. § 1136(b) ........................................................... 2 

Section 514(a), 29 U.S.C. § 1144(a) ......................................................... 14 

Miscellaneous: 

Restatement (Third) of Trusts § 205 & cmt. a (1992) .................................. 10 

Restatement (Third) of Trusts § 205(b) (1992) ...................................... 10, 13 

Restatement (Third) of Trusts § 211 & Illus. 1 (1992) ................................. 10 

Restatement (Second) of Trusts § 205 (1959) .............................................. 10 

Restatement (Second) of Trusts § 199 (1957) ................................................ 9 

iv 
Miscellaneous--(continued): Page 

Colleen E. Medill, Resolving the Judicial Paradox of "Equitable" Relief 

Under ERISA Section 502(a)(3), 39 J. Marshall L. Rev. 827 

(2006) ......................................................................................................... 14 

3 Austin W. Scott & William F. Fratcher, The Law of Jurisprudence 

§ 199.3 (4th ed. 1987) .................................................................................. 9 

3 Austin W. Scott & William F. Fratcher, The Law of Jurisprudence 

 § 205 (4th ed. 1987) ................................................................................... 10 

4 Austin W. Scott & William F. Fratcher, The Law of Jurisprudence 

 § 24.9 (5th ed. 2007) .................................................................................. 10 

George G. Bogert & George T. Bogert, The Law of Trusts and Trustees 

 § 862 (rev. 2nd ed. 1995) ...................................................................... 9 n.1 

3 John N. Pomeroy & Spensor W. Symons, A Treatise on Equity 

Jurisprudence § 1080 (5th ed. 1941) .......................................................... 9 

2 Joseph Story, Commentaries on Equity Jurisprudence § 1266 

(12th ed. 1877) ............................................................................................ 9 

2 Joseph Story, Commentaries on Equity Jurisprudence § 1278 

(12th ed. 1877) ............................................................................................ 9 

R. Francis, Maxims of Equity 29 (1st Am. ed. 1823) ..................................... 3 

Black's Law Dictionary 1482 (8th ed. 2004) ................................................ 10 

v 
BACKGROUND AND INTEREST OF THE SECRETARY OF LABOR 

Petitioner Gregory Gabriel, a participant in the Alaska Electrical Pension 

Fund (Fund), a pension plan governed by the Employee Retirement Income 

Security Act (ERISA), 29 U.S.C. § 1001 et seq., seeks en banc reconsideration of 

the panel decision in this case. 

The panel affirmed the district court's dismissal of Gabriel's claims seeking 

equitable relief from the Fund, as well as from a number of entities and individuals 

who managed the Fund and were ERISA fiduciaries. As relevant here, the panel 

held that the equitable remedy sometimes referred to as surcharge only permits a 

monetary award against an ERISA fiduciary in two circumstances: (1) where the 

fiduciary has profited at the expense of the trust; or (2) to make good losses to the 

trust. Thus, the panel concluded that, even if a plan participant suffers losses as a 

result of fiduciary breaches in administering the plan in which he is a participant, a 

court may not, as an equitable matter under ERISA section 502(a)(3), 29 U.S.C. § 

1132(a)(3), order the plan fiduciaries to make good those losses. Gabriel v. Alaska 

Elec. Pension Fund, -- F.3d --, 2014 WL 2535469, at *7-*9 (9th Cir. June 6, 2014). 

As Judge Berzon argued in dissent, this holding cannot be squared with the 

Supreme Court's decision in CIGNA Corp. v. Amara, 131 S.Ct. 1866 (2011), or 

with decisions of the Fourth, Fifth and Seventh Circuits following Amara, and is 

based on an incorrect reading of those cases and the trust law on which they are 
 

based. 2014 WL 2535469, at *15-*18. The Secretary of Labor, who has primary 

authority for enforcing and administering Title I of ERISA, 29 U.S.C. §§ 1002(13), 

1136(b), files this brief in support of Gabriel's petition to the extent that it 

challenges the panel's erroneous understanding of the equitable remedy of 

surcharge. 

ARGUMENT 

EQUITABLE RELIEF UNDER ERISA SECTION 502(a)(3) INCLUDES 

MONETARY RELIEF THAT MAKES INJURED PLAN PARTICIPANTS 

AND THEIR BENEFICIARIES WHOLE 

A. Amara allows monetary relief for participant losses caused by fiduciary 

breach 

The Supreme Court's Amara decision makes clear that suits against 

fiduciaries for monetary redress of fiduciary breaches running directly to plan 

participants and beneficiaries who have been harmed by such breaches are 

permitted as "appropriate equitable relief" under ERISA section 502(a)(3). In 

Amara, plan participants in a defined-benefit pension plan challenged the 

conversion of their plan to a "cash balance" plan, arguing that faulty information 

that CIGNA provided with regard to the conversion adversely affected their 

pension benefits. 131 S. Ct. at 1870-71. The trial court found that the disclosures 

violated CIGNA's duties as a fiduciary under ERISA, and that the plaintiffs were 

"likely harmed" by these violations. The trial court awarded injunctive relief under 

section 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), ordering the fiduciaries to pay the 

2
 
benefits that the participants expected based on the misleading disclosures. Id. at 

1875. 

Although the Supreme Court concluded that section 502(a)(1)(B) was not 

the appropriate avenue for the relief sought by the plan participants, the Court 

found such authority in ERISA's equitable relief provision, section 502(a)(3). 131 

S. Ct. at 1878-80. Noting the maxim that "[e]quity suffers not a right to be without 

a remedy," Amara, 131 S. Ct. at 1879 (quoting R. Francis, Maxims of Equity 29 

(1st Am. ed. 1823)), the Court held that the authorization of "equitable relief" 

under section 502(a)(3) provides a broad range of equitable remedies for such 

fiduciary misconduct, including make-whole relief or "surcharge." Id. In the 

Court's view, its previous decisions denying a loss remedy under section 502(a)(3) 

were distinguishable because they involved non-fiduciaries, while CIGNA was a 

fiduciary. Id. at 1880 ("insofar as an award of make-whole relief is concerned, the 

fact that the defendant in this case, unlike the defendant in Mertens [v. Hewitt 

Assocs., 508 U.S. 248 (1993)], is analogous to a trustee makes a critical 

difference"). 

The Court further explained that surcharge, or monetary compensation by a 

fiduciary for loss resulting from "a trustee's breach of duty, or to prevent the 

trustee's unjust enrichment," is a "traditional equitable remed[y]" falling in the 

category of "traditionally equitable relief" within the meaning of its previous cases. 

3
 
Amara, 131 S. Ct. at 1880 (citations omitted). The Court thus rejected the 

conclusion, adopted by a number of courts, including this one, that equitable 

monetary relief under 502(a)(3) was unavailable to compensate for losses caused 

by a trustee's fiduciary breach. See Peralta v. Hispanic Bus., Inc., 419 F.3d 1064, 

1076 (9th Cir. 2005). The Court explained that, because Amara involved "a suit by 

a beneficiary against a plan fiduciary (whom ERISA typically treats as a trustee) 

about the terms of the trust[,] it was the kind of lawsuit that, before the merger of 

law and equity, respondents could have brought only in a court of equity, not a 

court of law." 131 S. Ct. at 1879. It further explained: 

The surcharge remedy extended to a breach of trust committed by a fiduciary 

encompassing any violation of a duty imposed upon that fiduciary. Thus, 

insofar as an award of make-whole relief is concerned, . . . the types of 

remedies the court entered here fall within the scope of the term 'appropriate 

equitable relief' in § 502(a)(3). 

Id. (citations omitted). And, as most relevant here, the Court concluded that "the 

District Court injunctions requir [ing] the plan administrator to pay already retired 

beneficiaries money owed them under the plan as reformed" was a "kind of 

monetary remedy against a trustee, sometimes called 'surcharge,' [that] was 

'exclusively equitable.'" Id. at 1880. For example, Amara recognized that actual 

harm might come from the loss suffered by a participant from a fiduciary's failure 

to provide proper information. Id. at 1882. Thus, contrary to the understanding of 

the panel, 2014 WL 2535469, at *7, surcharge, as recognized by the Supreme 

4
 
Court in Amara, is not limited to restoring losses to a plan or recovering ill-gained 

profits from a fiduciary. 

B. Decisions from the Fourth, Fifth and Seventh Circuits confirm that 

equitable relief under section 502(a)(3) includes make-whole relief for 

participant and beneficiary losses 

For this reason, three circuits have correctly concluded that Amara abrogated 

their precedent disallowing such monetary relief and, in all three cases, recognized 

that surcharge is now available to remedy harm caused to an individual plan 

participant or beneficiary by a fiduciary's breach of any of its duties. See 

McCravy v. Metro. Life Ins. Co., 690 F.3d 176 (4th Cir. 2012); Gearlds v. Entergy 

Servs., Inc., 709 F.3d 448 (5th Cir. 2013); Kenseth v. Dean Health Plan, Inc., 722 

F.3d 869 (7th Cir. 2013). 

For instance, based on its recognition that Amara had caused a sea change in 

remedial law under ERISA, which the lower courts had mostly interpreted to 

forbid monetary relief for plan participants harmed by fiduciary breaches, the 

Fourth Circuit granted rehearing and vacated its earlier decision holding that 

surcharge and equitable estoppel were not available remedies under section 

502(a)(3). McCravy, 690 F.3d at 180. McCravy involved a plan participant who 

had a life insurance policy on her daughter through an ERISA-covered welfare 

plan, which she first obtained when her daughter was a minor. Id. at 178. 

McCravy continued to renew her coverage yearly and pay annual premiums until 

5
 
her daughter's death at age 25, at which time MetLife, the insurer and administrator 

of the plan, denied McCravy's claim for benefits. Id. According to MetLife, 

McCravy's daughter had aged out of coverage under the plan's "eligible dependent 

children" provision. Id. 

McCravy filed suit, alleging that MetLife's actions in accepting the 

premiums and otherwise misleading her as to coverage on her daughter caused her 

to forego the opportunity to convert to individual coverage under the plan. 690 

F.3d at 178. McCravy alleged that these actions were a breach of MetLife's duties 

as an ERISA fiduciary under the plan and she sued for recovery under section 

502(a)(3), claiming entitlement to either a make-whole surcharge recovery or 

equitable estoppel. Id. 

The district court and Fourth Circuit initially limited McCravy's recovery 

under section 502(a)(3) to a return of the premiums. 690 F.3d at 178. The case 

was reheard by the Fourth Circuit, however, after the Supreme Court decided 

Amara. In reversing its earlier decision, the Fourth Circuit concluded that Amara 

made it "quite clear" that monetary compensation for a loss resulting from a 

fiduciary's breach is available under section 502(a)(3). Id. at 181. Thus, the court 

"agree[d] with McCravy that her potential recovery is not limited, as a matter of 

law, to a premium refund." Id. Although the court stated that it was for the district 

court, on remand, to determine whether MetLife in fact breached its duties and 

6
 
 

whether surcharge or equitable estoppel were appropriate remedies under the facts 

of the case, id. at 181-82, if it had believed that McCravy could not personally 

recover her losses, as MetLife had argued, its remand on the surcharge issue would 

have been completely unnecessary. 

Similarly, in Gearlds, the Fifth Circuit held that Amara abrogated its prior 

decision holding that a claim for monetary damages for a plan participant harmed 

by fiduciary breaches was unavailable under section 502(a)(3). 709 F.3d at 450, 

(citing Amschwand v. Spherion Corp., 505 F.3d 342, 343 (5th Cir. 2007) as 

abrogated). The court read Amara as stating "an expansion of the kind of relief 

available under § 502(a)(3) when the plaintiff is suing a plan fiduciary and the 

relief sought makes the plaintiff whole for losses caused by the defendant's 

breaches of fiduciary duty." 709 F.3d at 450. Thus, the court held that Gearlds, a 

participant in a health care plan, stated a viable claim for surcharge when he 

alleged that plan fiduciaries breached their duties under ERISA by misleading him 

about his coverage in retirement, causing him to forego the opportunity to obtain 

coverage under his wife's policy, and he argued that "he should be made whole in 

the form of compensation for lost benefits." Id. at 452. As in McCravy, the Fifth 

Circuit would not have remanded if loss to the trust or unjust enrichment were a 

requirement for surcharge to apply. 

7
 
The Seventh Circuit has likewise recognized that, after Amara, the "relief 

available for a breach of fiduciary duty under section 1132(a)(3) is broader than we 

have previously held." Kenseth, 722 F.3d at 880. The court thus held that 

Kenseth, who sought to have the fiduciaries cover the cost of a medical procedure 

that they pre-authorized, "may seek make-whole equitable damages as a remedy 

under section 1132(a)(3) if she can in fact demonstrate that Dean breached its 

fiduciary duty to her and that the breach caused her damages." 722 F.3d at 882. 

This holding is directly contrary to the panel's holding that section 502(a)(3) does 

not provide a monetary remedy to make a participant whole for losses caused by a 

fiduciary breach. 

Indeed, the panel's holding that monetary relief for fiduciary breaches under 

section 502(a)(3) is limited to the recovery of losses to the plan itself or to the 

recovery of improper profits from the fiduciary fundamentally misconstrues the 

significance of Amara. Relief under ERISA section 502(a)(2), 29 U.S.C. § 

1132(a)(2) (which incorporates by reference ERISA section 409, 29 U.S.C. § 

1109), is already available for breaches of fiduciary duty that result in "losses to 

the plan" or to recover any profits a breaching fiduciary improperly made through 

the use of plan assets. 29 U.S.C. § 1109(a). Thus, the decision in Amara 

concerning the availability of a loss remedy under section 502(a)(3) was precisely 

about the availability of a recovery for plan participants who have been harmed 

8
 
 

 

when their plans have not. And the post-Amara decisions described above are all 

about such individual recoveries by participants and beneficiaries and must be 

understood in that light. 

C. The law of equity confirms the availability of such relief 

Far from undercutting these holdings, the law of equity fully supports what 

the Supreme Court in Amara concluded: that courts of equity were empowered to 

and often did make trust beneficiaries whole for losses caused by breach of trust. 

Equity provided a variety of remedies for breach of trust. Restatement (Second) of 

Trusts § 199, at 437 (1957). One equitable remedy was "to compel the trustee to 

redress [the] breach," including by "the payment of money." Id.; 3 Austin W. Scott 

& William F. Fratcher, The Law of Trusts § 199.3, at 206 (4th ed. 1987) (Scott 

4th); see 3 John Norton Pomeroy & Spensor W. Symons, Equity Jurisdiction 

§ 1080, at 2481-2482 (5th ed. 1941); 2 Joseph Story, Commentaries on Equity 

Jurisdiction §§ 1266-1278, at 519-534 (12th ed. 1877). That monetary recovery, 

which was sometimes referred to as "surcharge," required the breaching fiduciary 

to pay "the amount necessary to compensate fully for the consequences of the 

breach."1

 Depending on the circumstances, the beneficiary could "charge the 

1

 Liability for breach of trust could be imposed "either in a suit brought for that 

purpose or on an accounting where the trustee [was] surcharged beyond the 

amount of his admitted liability." George G. Bogert & George T. Bogert, The Law 

of Trusts and Trustees § 862, at 36 (rev. 2d ed. 1995). Although some courts and 

treatises refer only to the latter remedy, done as part of an accounting, as 

9
 
 

trustee with any loss that resulted from the breach of trust, or with any profit made 

through the breach of trust, or with any profit that would have accrued if there had 

been no breach of trust." 3 Scott 4th § 205, at 237; see Restatement (Second) of 

Trusts § 205, at 458. 

Thus, for example, courts could order a trustee to "restore the values of the 

trust estate and trust distributions to what they would have been if the trust had 

been properly administered." Restatement (Third) of Trusts § 205 & cmt. a, at 223 

(1992) (emphasis added). See also 4 Austin W. Scott & William F. Fratcher, The 

Law of Trusts § 24.9, at 1690-91 (5th ed. 2007) (quoting Restatement (Third) of 

Trusts § 205(b) (1992)); Black's Law Dictionary 1482 (8th ed. 2004); United States 

v. Mason, 412 U.S. 391, 398 (1973); Mosser v. Darrow, 341 U.S. 267, 270-273 

(1951); Princess Lida of Thurn & Taxis v. Thompson, 305 U.S. 456, 458, 463-464 

(1939). The fact that the Restatement recognizes that this remedy allows 

restoration of trust distributions refutes the notion that surcharge awards are 

payable only to the trust. See also Restatement (Third) of Trusts § 211, Illus. 1, at 

162 ("[i]f the income of the trust is to be distributed to [the beneficiary], any 

income recovery from [the trustee] belongs to [the beneficiary]"). Instead, 

depending on the nature of the breach, the monetary recovery could be paid to the 

"surcharge," others, including the Supreme Court in Amara, use the term 

"surcharge" to refer more generally to a loss remedy imposed on a breaching 

fiduciary. 

10
 
 

beneficiary rather than the trust itself, as evidenced by numerous cases in equity 

instructing trustees to pay beneficiaries directly. See, e.g., Gates v. Plainfield Tr. 

Co., 194 A. 65 (N.J. 1937) (per curiam) (upholding decree that required executor 

to pay income to life beneficiary); Kendall v. DeForest, 101 F. 167, 170 (2d Cir. 

1900) (upholding decree that held trustee liable to beneficiaries for income 

deficiency resulting from breach of trust that had depleted annuity fund); 

It is therefore clear that a suit to compel a fiduciary to provide monetary 

redress to plan participants and their beneficiaries for a breach of fiduciary duty 

seeks "equitable relief" and is authorized under section 502(a)(3). 

D. ERISA's structure and purpose underscore that the statute allows suits by 

participants and beneficiaries to recover their own losses attributable to 

fiduciary breaches 

Fiduciaries and fiduciary duties have a central role in the ERISA regime. 

Fiduciaries have primary responsibility for administration and control of ERISA 

covered plans. See Mertens, 508 U.S. at 262; 29 U.S.C. § 1002(21)(A). Congress 

therefore viewed the fiduciary duties imposed by ERISA as affording critical 

protection for plan participants and beneficiaries. 29 U.S.C. § 1001(b). And 

Congress intended ERISA to provide "appropriate remedies" and "ready access to 

the Federal courts" to prevent and to redress violations of those fiduciary duties. 

Id. 

11
 
It is thus "hard to imagine" that Congress would have left participants and 

beneficiaries who have been injured by a breach of ERISA's fiduciary duties 

without any effective federal remedy. Varity v. Howe, 516 U.S. 489, 513 (1996). 

But that will be the result in many situations if this Court declines to vacate the 

panel's decision holding that section 502(a)(3) does not authorize plan participants 

and beneficiaries to recover their own losses stemming from fiduciary breaches. 

This is because many breaches, particularly in the context of welfare plans, cause 

losses only to individual participants and beneficiaries and not to the plan (which, 

outside the context of pension and collectively-bargained plans, often is not a 

funded trust or an entity with any assets at all). 

For example, a fiduciary's negligence in submitting health insurance 

premiums may leave a plan participant without coverage during a costly illness. 

E.g., McFadden v. R&R Engine & Mach. Co., 102 F. Supp. 2d 458 (N.D. Ohio 

2000). Similarly, a fiduciary's negligent processing of a life insurance application 

or premiums may leave a participant's beneficiaries without the insurance proceeds 

that they expected. E.g., Strom v. Goldman Sachs & Co., 202 F.3d 138, 140-141 

(2d Cir. 1999). And a fiduciary's provision of inaccurate information about the tax 

consequences of distribution options may cause a participant to suffer a substantial 

tax liability that should have been avoided. E.g., Griggs v. E.I. DuPont de 

Nemours & Co., 237 F.3d 371, 373-374 (4th Cir. 2001). In each of these situations 

12
 
 

and many others, if section 502(a)(3) did not permit traditional suits in equity for 

monetary redress of fiduciary breaches that caused participants or beneficiaries to 

lose payments or distributions from the plan (see Third Restatement § 205(b) at 

233), ERISA would provide no meaningful relief for participants and beneficiaries 

who have been seriously injured by those breaches. 

Leaving those participants and beneficiaries without a meaningful federal 

remedy cannot be squared with ERISA's purpose of providing them with "ready 

access to the Federal courts" to redress violations of ERISA's fiduciary duties. 29 

U.S.C. § 1001(b).2

 Indeed, it is particularly appropriate to interpret section 

502(a)(3) as providing the necessary remedy given that Congress intended this 

provision to be a "'catchall'" that would "act as a safety net, offering appropriate 

equitable relief for injuries caused by violations that 502 does not elsewhere 

adequately remedy." Varity, 516 U.S. at 512. Moreover, a holding that section 

502(a)(3) does not authorize monetary redress for fiduciary breaches would do 

more than deprive a large number of injured participants and beneficiaries of an 

effective federal remedy. It would leave them without any meaningful remedy, 

given ERISA's expansive preemption provision, which generally displaces all state 

2

 Although participants potentially could still seek an injunction compelling the 

fiduciary to fulfill its duties in the future or, in some circumstances, bring suit on 

the plan's behalf to remove the fiduciary, those remedies, even in the limited 

circumstances in which they are available, are hollow ones for individuals who 

have already suffered devastating financial losses as a result of fiduciary misdeeds. 

13
 
 

laws that "relate to any [ERISA covered] plan," 29 U.S.C. § 1144(a), and thus 

overrides state law remedies against plan fiduciaries arising from a breach of 

ERISA's fiduciary duties. See, e.g., Peralta, 419 F. 3d at 1069. 

For that reason, the narrow reading of section 502(a)(3) mistakenly adopted 

by the panel would lead inevitably back to the untenable situation prior to Amara, 

which rightly resulted in a "rising judicial chorus urging" the correction of "an 

unjust and increasingly tangled ERISA regime." Aetna Health Inc. v. Davila, 542 

U.S. 200, 222 (2004) (Ginsburg, J., joined by Breyer, J., concurring) (citation 

omitted). See, e.g., Eichorn v. AT&T Corp., 489 F.3d 590, 591-92 (3d Cir. 2007) 

(Ambro, J., concurring in denial of petition for rehearing en banc); Lind v. Aetna 

Health Inc., 466 F.3d 1195, 1200 (10th Cir. 2006); Pereira v. Farace, 413 F.3d 330, 

345-346 (2d Cir. 2005) (Newman, J., concurring); Cicio v. Does 1-8, 321 F.3d 83, 

106 (2d Cir. 2003) (Calabresi, J., dissenting in part), vacated, 542 U.S. 933 (2004); 

DiFelice v. Aetna U.S. Healthcare, 346 F.3d 442, 467 (3d Cir. 2003) (Becker, J., 

concurring). See also Colleen E. Medill, Resolving the Judicial Paradox of 

"Equitable" Relief Under ERISA Section 502(a)(3), 39 J. Marshall L. Rev. 827, 

852 (2006) (echoing the judicial concern that participants and beneficiaries cannot 

be left "betrayed without a remedy"). 

14
 
 

 

 

 

CONCLUSION 

For the foregoing reasons, the Secretary respectfully requests that the Court 

grant panel or en banc rehearing of this case, vacate the decision of the panel, and 

issue a decision recognizing that section 502(a)(3) allows courts to order plan 

fiduciaries, as "appropriate equitable relief," to make participants whole for the 

losses they have suffered as a result of fiduciary breaches. 

Respectfully submitted, 

M. PATRICIA SMITH 

 Solicitor of Labor

 G. WILLIAM SCOTT

 Associate Solicitor 

 /s/ Elizabeth Hopkins 

 ELIZABETH HOPKINS

 Counsel for Appellate and Special 

Litigation 

U.S. Department of Labor 

200 Constitution Ave., N.W. 

Room, N-4611 

 Washington, D.C. 20210 

(202) 693-5584 

JULY 2014 

15
 
 

 

CERTIFICATE OF COMPLIANCE OF BRIEFS 

AND VIRUS CHECK 

Pursuant to Fed. R. App. P. 32(a)(7)(C) and Circuit Rule 29-2(c)(2), I certify that 

this 15 page amicus brief uses a mono-spaced typeface of 14 characters per inch 

and contains 3,514 words. Pursuant to Circuit Rule 29-2(c)(2), this brief complies 

with the 4,200 word limit. 

I further certify that a virus scan was performed on the Brief using McAfee, and 

that no viruses were detected. 

Dated: July 28, 2014 /s/ Elizabeth Hopkins 

 ELIZABETH HOPKINS 

Counsel for Appellate and 

Special Litigation 
 

 

CERTIFICATE OF SERVICE 

I hereby certify that on the 28th day of July, 2014, true and correct copies of 

the foregoing - THE SECRETARY OF LABOR'S AMICUS CURIAE BRIEF IN 

SUPPORT OF PETITION FOR REHEARING OR EN BANC REHEARING -

were filed electronically with the Clerk of the Court for the United States Court of 

Appeals for the Ninth Circuit by using the appellate CM/ECF system and served 

electronically via email to the following counsel at the addresses set forth below: 

Attorney for Plaintiff/Appellant: Attorney for amicus curiae AARP: 

Jennifer Mary Coughlin, Mary E. Signorille, Esquire 

K&L GATES, LLP AARP Foundation Litigation 

Suite 400 601 E Street, NW 

420 L Street Washington, DC 20049 

Anchorage, AK 99501-1971 

Attorneys for Defendants/Appellees: 

Allen Bruce McKenzie 

Frank J. Morales 

McKenzie Rothwell Barlow & Korpi, P.S. 

500 Union Street 

Suite 700 

Seattle, WA 98101 

Attorneys for amicus curiae National Employment Lawyers Association: 

Julie Hayden Wilensky 

Lindsay Nako 

Catha Worthman 

Lewis, Feinberg, Lee, Renaker & Jackson, P.C. 

476 9th Street 

Oakland, CA 94607-4048 

Dated: July 28, 2014 /s/ Nathaniel I. Spiller 

 Nathaniel I. Spiller (for Elizabeth Hopkins) 

 Counsel for Appellate and Special 

Litigation