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GREAT-WEST LIFE & ANNUITY INSURANCE CO - 534 U.S. 204 - 2002 - Full Text - US Supreme Court Center - USSC Cases - Nolo
US Supreme Court Center > Volume 534 > GREAT-WEST LIFE & ANNUITY INSURANCE CO 534 U.S. 204 (2002) > Full Text
SCALIA, J., delivered the opinion of the Court, in which REHNQUIST, C. J., and O'CONNOR, KENNEDY, and THOMAS, JJ., joined. STEVENS, J., filed a dissenting opinion, post, p. 221. GINSBURG, J., filed a dissenting opinion, in which STEVENS, SOUTER, and BREYER, JJ., joined, post, p.224.
Arthur H. Bryant, F. Paul Bland, Jr., and Leslie Brueckner filed a brief for the Maryland HMO Subrogation Plaintiffs as amici curiae.
In late 1993, the Knudsons filed a tort action in California state court seeking to recover from Hyundai Motor Company, the manufacturer of the car they were riding in at the time of the accident, and other alleged tortfeasors. The parties to that action negotiated a $650,000 settlement, a notice of which was mailed to Great-West. This allocated $256,745.30 to a Special Needs Trust under Cal. Prob. Code Ann. § 3611 (West 1991 and Supp. 1993) to provide for
Great-West, however, never cashed the check it received from respondents' attorney. Instead, at the same time that Great-West sought to remove the state-law tort action, it filed this action in the same federal court (the United States District Court for the Central District of California), seeking injunctive and declaratory relief under § 502(a)(3) to enforce the reimbursement provision of the Plan by requiring the Knudsons to pay the Plan $411,157.11 of any proceeds recovered from third parties. Great-West subsequently filed an amended complaint adding Earth Systems and the Plan as plaintiffs and seeking a temporary restraining order against continuation of the state-court proceedings for approval of the settlement. The District Court denied the temporary restraining order, a ruling that petitioners did not appeal. After the state court approved the settlement and the money was disbursed, the District Court granted summary judgment to the Knudsons. It held that the language of the Plan limited its right of reimbursement to the amount received by
As we explained in Mertens, "'[e]quitable' relief must mean something less than all relief." 508 U. S., at 258, n. 8.
First, petitioners argue that they are entitled to relief under § 502(a)(3)(A) because they seek "to enjoin a[n] act or practice"-respondents' failure to reimburse the Plan"which violates ... the terms of the plan." But an injunction to compel the payment of money past due under a con-
1 At oral argument, petitioners' counsel argued that the injunction specifically authorized by § 502(a)(3)(A) need not be a form of equitable relief. Petitioners' brief, however, conceded that the reference in § 502(a)(3)(B) to "other appropriate equitable relief" suggests that the relief authorized in § 502(a)(3)(A) "to enjoin any act or practice which violates ... the terms of [a] plan" is, itself, "appropriate equitable relief." See Brief for Petitioners 15, n. 6 (emphasis added). In any event, injunction is inherently an equitable remedy, see, e. g., Reich v. Continental Casualty Co., 33 F. 3d 754,756 (CA7 1994); 1 D. Dobbs, Law of Remedies § 1.2, p. 11 (2d ed. 1993) (hereinafter Dobbs), and statutory reference to that remedy must, absent other indication, be deemed to contain the limitations upon its availability that equity typically imposes. Without this rule of construction, a statutory limitation to injunctive relief would be meaningless, since any claim for legal relief can, with lawyerly inventiveness, be phrased in terms of an injunction. Here, of course, there is not only no contrary indication, but the positive indication in paragraph (B) that the injunction referred to in paragraph (A) is an equitable injunction.
Second, petitioners argue that their suit is authorized by § 502(a)(3)(B) because they seek restitution, which they characterize as a form of equitable relief. However, not all relief falling under the rubric of restitution is available in equity. In the days of the divided bench, restitution was available in certain cases at law, and in certain others in equity. See, e. g., 1 Dobbs § 1.2, at 11; id., § 4.1(1), at 556; id., § 4.1(3), at 564-565; id., §§ 4.2-4.3, at 570-624; 5 Corbin § 1102, at 550; Muir, ERISA Remedies: Chimera or Congressional Compromise?, 81 Iowa L. Rev. 1, 36-37 (1995); Redish, Seventh Amendment Right to Jury Trial: A Study in the Irrationality
In contrast, a plaintiff could seek restitution in equity, ordinarily in the form of a constructive trust or an equitable lien, where money or property identified as belonging in good conscience to the plaintiff could clearly be traced to particular funds or property in the defendant's possession. See 1 Dobbs § 4.3(1), at 587-588; Restatement of Restitution, supra, § 160, Comment a, at 641-642; 1 G. Palmer, Law of Restitution § 1.4, p. 17; § 3.7, p. 262 (1978). A court of equity could then order a defendant to transfer title (in the case of the constructive trust) or to give a security interest (in the case of the equitable lien) to a plaintiff who was, in the eyes of equity, the true owner. But where "the property [sought to be recovered] or its proceeds have been dissipated so that no product remains, [the plaintiff's] claim is only that of a general creditor," and the plaintiff "cannot enforce a con-
2 There is a limited exception for an accounting for profits, a form of equitable restitution that is not at issue in this case. If, for example, a plaintiff is entitled to a constructive trust on particular property held by the defendant, he may also recover profits produced by the defendant's use of that property, even if he cannot identify a particular res containing the profits sought to be recovered. See 1 Dobbs § 4.3(1), at 588; id., § 4.3(5), at 608. Petitioners do not claim the profits (if any) produced by the proceeds from the state-court settlement, and are not entitled to the constructive trust in those proceeds that would support such a claim.
Likewise, in Harris Trust and Sav. Bank v. Salomon Smith Barney Inc., 530 U. S. 238 (2000), we noted that "an action for restitution against a transferee of tainted plan assets" is "appropriate equitable relief" within the meaning of § 502(a)(3). Id., at 253. While we did not expressly distinguish between legal and equitable restitution, the nature of the relief we described in Harris Trust-a claim to specific property (or its proceeds) held by the defendant-accords with the restitution we describe as equitable today. Id., at 250 ("The trustee or beneficiaries may then maintain an action for restitution of the property (if not already disposed of) or disgorgement of proceeds (if already disposed of) ... " (emphasis added)); id., at 250-251 ("Whenever the legal title to property is obtained through means or under
In any event, JUSTICE GINSBURG'S approach, which looks only to the nature of the relief and not to the conditions that equity attached to its provision, logically leads to the same untenable conclusion reached by JUSTICE STEVENS'S dissent-which is that § 502(a)(3)(A)'s explicit authorization of injunction, which it identifies as a form of equitable relief, permits (what equity would never permit) an injunction against failure to pay a simple indebtedness-or, for that matter, an injunction against failure to pay punitive damages. The problem with that conclusion, of course, is that it renders the statute's limitation of relief to "[injunction] ... or other appropriate equitable relief" utterly pointless. It
3 A Westlaw search discloses that the term "equitable relief" appears in 77 provisions of the United States Code.
If the referent of "other equitable relief" were "back pay," it could be said, in a sense relevant here, that Congress "treated" backpay as equitable relief. In fact, however, the referent is "reinstatement or hiring of employees," which is modified by the phrase "with or without back pay." Curtis recognized that courts of appeals had treated Title VII backpay as
The statement in Terry on which JUSTICE GINSBURG relies-that "Congress specifically characterized backpay under Title VII as a form of 'equitable relief,'" 494 U. S., at 572-is plainly inaccurate unless it is understood to mean that Title VII backpay was "specifically" made part of an equitable remedy. That is the only sense which the Terry discussion requires, and is reinforced by the immediately following citation of the portion of Curtis that called Title VII backpay "an integral part of an equitable remedy," Curtis, supra, at 197. See Terry, supra, at 572. The restitution sought here by Great-West is not that, but a freestanding claim for money damages. Title VII has nothing to do with this case.
We need not decide these issues because, as we explained in Mertens, "[e]ven assuming ... that petitioners are correct about the pre-emption of previously available state-court actions" or the lack of other means to obtain relief, "vague notions of a statute's 'basic purpose' are nonetheless inadequate to overcome the words of its text regarding the specific issue under consideration." 508 U. S., at 261. In the
5 Varity Corp. v. Howe, 516 U. S. 489 (1996), upon which petitioners rely, is not to the contrary. In Varity Corp., we explained that § 502(a)(3) is a "'catchall' provisio[n]" that "act[s] as a safety net, offering appropriate equitable relief for injuries caused by violations that § 502 does not elsewhere adequately remedy." Id., at 512. Thus, we concluded that § 502(a)(3) authorizes lawsuits by beneficiaries for individualized equitable relief for breach of fiduciary obligations, notwithstanding the petitioner's argument that such relief is not "appropriate" because § § 502(a)(2) and 409 of ERISA specifically address liability for breach of fiduciary duty and preclude individualized relief. Id., at 507-515. In Varity Corp., however, it was undisputed that respondents were seeking equitable relief, and the question was whether such relief was "appropriate" in light of the apparent lack of alternative remedies. Id., at 508. Varity Corp. did not hold, as petitioners urge us to conclude today, that § 502(a)(3) is a catchall provision that authorizes all relief that is consistent with ERISA's purposes and is not explicitly provided elsewhere. To accept petitioners' argument is to ignore the plain language of the statute, which provides fiduciaries with only equitable relief.
Nevertheless, Mertens is the law, and an inquiry under § 502(a)(3)(B) now entails an analysis of what relief would have been "typically available in equity." 508 U. S., at 256. This does not mean, however, that all inquiries under § 502(a)(3) must involve historical analysis, as the Court seems to believe, e. g., ante, at 209-210. In Mertens, our task was to interpret "other appropriate equitable relief" under § 502(a)(3)(B), and our holding thus did not extend to the meaning of "to enjoin" in § 502(a)(3)(A). As a result, an analysis of tradition is unnecessary with respect to § 502(a)(3)(A). Moreover, that section provides a proper basis for federal jurisdiction in the present case, as petitioners brought suit "to enjoin any act or practice which violates ... the terms of [a] plan." § 502(a)(3)(A).
3 In a response to this dissent that echoes Tennyson's poem about the Light Brigade-"Theirs not to reason why, Theirs but to do and die" -the Court states that it is "not our job to find reasons for what Congress has plainly done," ante, at 217. Congress, of course, has the power to enact unreasonable laws. Nevertheless, instead of blind obedience to what at first blush appears to be such a law, I think it both prudent and respectful to pause to ask why Congress would do so.
The rarified rules underlying this rigid and time-bound conception of the term "equity" were hardly at the fingertips of those who enacted § 502(a)(3). By 1974, when ERISA became law, the "days of the divided bench" were a fading memory, for that era had ended nearly 40 years earlier with
That Congress did not intend to strap § 502(a)(3) with the anachronistic rules on which the majority relies is corroborated by the anomalous results to which the supposed legislative "choice" leads. Although the Court recognizes that it need not decide the issue, see ante, at 220, its opinion surely contemplates that a constructive trust claim would lie; hence, the outcome of this case would be different if Great-West had sued the trustee of the Special Needs Trust, who has "possession" of the requested funds, instead of the Knudsons, who do not. See ante, at 214 (constructive trust unavailable because "the funds to which petitioners claim an entitlement ... are not in respondents' possession"). Under
1 In the District Court, both parties sought decision on the amount Great-West was entitled to recoup under the Plan's provision for recovery of benefits paid, and the court resolved that issue in the Knudsons' favor. The Ninth Circuit, however, refused to review the District Court's resolution of that question, holding instead that federal courts are without authority to grant any relief to parties in Great-West's situation. Because neither party defended that ruling in this Court, Motion to Dismiss as Improvidently Granted 1, we appointed an amicus curiae to argue in support of the Ninth Circuit's judgment. See 532 U. S. 917 (2001). Both on brief and at oral argument, appointed counsel commendably developed the position the majority now adopts.
We have recognized that Congress sought through ERISA "to establish a uniform administrative scheme" and to ensure that plan provisions would be enforced in federal court, free of "the threat of conflicting or inconsistent State and local regulation." Fort Halifax Packing Co. v. Coyne, 482 U. S. 1, 9 (1987) (internal quotation marks omitted) (quoting 120 Congo Rec. 29933 (1974)). The majority's construction frustrates those goals by ascribing to Congress the paradoxical intent to enact a specific provision, § 502(a)(3), that thwarts the purposes of the general scheme of which it is part. The Court is no doubt correct that "vague notions of a statute's 'basic purpose' are ... inadequate to overcome the words of its text regarding the specific issue under consideration."
Unprepared to agree that Congress chose to infuse § 502(a)(3) with the recondite distinctions on which the majority relies, I would accord a different meaning to the term "equitable." Consistent with what Congress likely intended and with our decision in Mertens, I would look to the substance of the relief requested and ask whether relief of that character was "typically available in equity." Mertens, 508 U. S., at 256. Great-West seeks restitution, a category of relief fully meeting that measure even if the remedy was also available in cases brought at law. Accordingly, I would not oust this case from the federal courts.
As the majority appears to admit, see ante, at 214, our cases have invariably described restitutionary relief as "equitable" without even mentioning, much less dwelling upon, the ancient classifications on which today's holding rests. See, e. g., Tull v. United States, 481 U. S. 412, 424 (1987) (restitution "traditionally considered an equitable remedy"); Mertens, 508 U. S., at 255 (restitution is a "remedy traditionally viewed as 'equitable' "); Teamsters v. Terry, 494 U. S. 558, 570 (1990) ("[W]e have characterized [money] damages as equitable where they are restitutionary."); Mitchell, 361 U. S., at 291-293 (District Court could exercise equitable authority under Fair Labor Standards Act to order restitution); cf. Moses v. Macferlan, 2 Burr. 1005, 1012,97 Eng. Rep. 676, 681 (K. B. 1760) ("In one word, the gist of this kind of action is that the defendant, upon the circumstances of the case, is obliged by the ties of natural justice and equity to refund the money."). These cases establish what the Court does not
2 The Courts of Appeals have not aligned behind the Court's theory that Congress treated Title VII backpay as equitable "only in the narrow sense that" such relief is an "integral part" of the statutory remedy of reinstatement. Ante, at 218, n. 4. While some courts have employed the majority's rationale, others have adopted the position the Court denies: that Title VII backpay is restitutionary and "therefore equitable," ibid. See, e. g., EEOC v. Detroit Edison Co., 515 F.2d 301, 308 (CA6 1975) ("Back pay in Title VII cases is considered a form of restitution, not an award of damages. Since restitution is an equitable remedy a jury is not required for the award of back pay."), vacated on other grounds, 431 U. S. 951 (1977); Rogers v. Loether, 467 F.2d 1110, 1121 (CA7 1972) ("It is not unreasonable
Such a reading of § 2000e-5(g)(1) accords with our recognition in Teamsters v. Terry, 494 U. S. 558, 572 (1990), that "Congress specifically characterized backpay under Title VII as a form of 'equitable relief.' " (Emphasis added.) We were somewhat ambiguous in Curtis v. Loether, 415 U. S. 189, 197 (1974), about the rationale of the Courts of Appeals, reasoning that they had treated Title VII backpay as equitable because Congress had made backpay "an integral part of an equitable remedy, a form of restitution." But we spoke with greater clarity in Terry, 494 U. S., at 570-571, explaining that we could find an "exception to the general rule" that monetary relief is legal, rather than equitable, in two situations: either "where thEe relief is] restitutionary," a category into which we suggested Title VII backpay might fall, see id., at 572 ("backpay sought from an employer under Title VII would generally be restitutionary in nature"); or where "a monetary award [is] 'incidental to or intertwined with injunctive relief,'" id., at 571 (quoting Tull v. United States, 481 U. S. 412, 424 (1987)).
Even if the Court's chosen texts always yielded a quick and plain answer, however, I would think it no less implausible that Congress intended to make controlling the doctrine those texts describe. See supra, at 224-228. Our reliance on that doctrine in the context of the Seventh Amendment and Judiciary Act of 1789, see ante, at 217, underscores the incongruity of applying it here. It may be arguable that "preserving" the meaning of those founding-era provisions requires courts to determine which tribunal would have entertained a particular claim in 18th-century England. See
Thus, there is no reason to ask what court would have entertained Great-West's claim "[i]n the days of the divided bench," ante, at 212, and no need to engage in the antiquar-