Source: https://www.law.cornell.edu/supremecourt/text/18-1116
Timestamp: 2020-04-08 05:58:50
Document Index: 514700173

Matched Legal Cases: ['§413', '§1113', '§1113', '§1113', '§1113', '§1113', '§1113', '§1303', '§1370', '§1085', '§1085', '§1113', '§1022', '§1113', '§1113', '§1113', '§1113', '§1113', '§1113', '§1113', '§9342', '§1113']

INTEL CORP. INVESTMENT POLICY COMM. v. SULYMA | Supreme Court | US Law | LII / Legal Information Institute
The Employee Retirement Income Security Act of 1974 (ERISA) requires plaintiffs with “actual knowledge” of an alleged fiduciary breach to file suit within three years of gaining that knowledge rather than within the 6-year period that would otherwise apply. §413(a)(2)(A), 88 Stat. 889, as amended, 29 U. S. C. §1113. The question here is whether a plaintiff necessarily has “actual knowledge” of the information contained in disclosures that he receives but does not read or cannot recall reading. We hold that he does not and therefore affirm.
Respondent Sulyma worked at Intel Corporation from 2010 to 2012. He participated in two Intel retirement plans, the Intel Retirement Contribution Plan and the Intel 401(k) Savings Plan. Payments into these plans were in turn invested in two funds managed by the Intel Investment Policy Committee.1 These funds mostly comprised stocks and bonds. After the stock market decline in 2008, however, the committee increased the funds’ shares of alternative assets, such as hedge funds, private equity, and commodities. These assets carried relatively high fees. And as the stock market rebounded, Sulyma’s funds lagged behind others such as index funds.
The District Court granted summary judgment to petitioners under §1113(2), reasoning that “[i]t would be improper to allow Sulyma’s claims to survive merely because he did not look further into the disclosures made to him.” 2017 WL 1217185, *9 (ND Cal., Mar. 31, 2017). The Ninth Circuit reversed. As relevant here,2 the court construed “actual knowledge” to mean “what it says: knowledge that is actual, not merely a possible inference from ambiguous circumstances.” 909 F. 3d 1069, 1076 (2018) (internal quotation marks omitted). Although Sulyma “had sufficient information available to him to know about the allegedly imprudent investments” more than three years before filing suit, the court held that his testimony created a dispute as to when he actually gained that knowledge. Id., at 1077.
Several Circuits have likewise construed §1113(2) to require “knowledge that is actual,” id., at 1076, but one has construed it to require only proof of sufficient disclosure.3 We granted certiorari, 587 U. S. ___ (2019), to resolve whether the phrase “actual knowledge” does in fact mean “what it says,” 909 F. 3d, at 1076, and hold that it does.
“We must enforce plain and unambiguous statutory language” in ERISA, as in any statute, “according to its terms.” Hardt v. Reliance Standard Life Ins. Co., 560 U. S. 242, 251 (2010). Although ERISA does not define the phrase “actual knowledge,” its meaning is plain. Dictionaries are hardly necessary to confirm the point, but they do. When Congress passed ERISA, the word “actual” meant what it means today: “existing in fact or reality.” Webster’s Seventh New Collegiate Dictionary 10 (1967); accord, Merriam-Webster’s Collegiate Dictionary 13 (11th ed. 2005) (same); see also American Heritage Dictionary 14 (1973) (“In existence; real; factual”); id., at 18 (5th ed. 2011) (“Existing in reality and not potential, possible, simulated, or false”). So did the word “knowledge,” which meant and still means “the fact or condition of being aware of something.” Webster’s Seventh New Collegiate Dictionary 469 (1967); accord, Merriam-Webster’s Collegiate Dictionary 691 (2005) (same); see also American Heritage Dictionary 725 (1973) (“Familiarity, awareness, or understanding gained through experience or study”); id., at 973 (2011) (same). Thus, to have “actual knowledge” of a piece of information, one must in fact be aware of it.
Legal dictionaries give “actual knowledge” the same meaning: “[r]eal knowledge as distinguished from presumed knowledge or knowledge imputed to one.” Ballentine’s Law Dictionary 24 (3d ed. 1969); accord, Black’s Law Dictionary 1043 (11th ed. 2019) (defining “actual knowledge” as “[d]irect and clear knowledge, as distinguished from constructive knowledge”).4 The qualifier “actual” creates that distinction. In everyday speech, “actual knowledge” might seem redundant; one who claims “knowledge” of a topic likely means to suggest that he actually knows a thing or two about it. But the law will sometimes impute knowledge—often called “constructive” knowledge—to a person who fails to learn something that a reasonably diligent person would have learned. See id., at 1043. Similarly, we held in Merck & Co. v. Reynolds, 559 U. S. 633 (2010), that the word “discovery,” when used in a statute of limitations without qualification, “encompasses not only those facts the plaintiff actually knew, but also those facts a reasonably diligent plaintiff would have known.” Id., at 648. The addition of “actual” in §1113(2) signals that the plaintiff ’s knowledge must be more than “potential, possible, virtual, conceivable, theoretical, hypothetical, or nominal.” Black’s Law Dictionary 53 (4th ed. 1951). Indeed, in Merck, we cited §1113(2) as evidence of the “linguistic distinction” between “ ‘actual knowledge’ ” and the “hypothetical” knowledge that a reasonably diligent plaintiff would have. 559 U. S., at 646–647 (quoting §1113(2); emphasis in original).
Congress has drawn the same distinction elsewhere in ERISA. Multiple provisions contain alternate 6-year and 3-year limitations periods, with the 6-year period beginning at “the date on which the cause of action arose” and the 3-year period starting at “the earliest date on which the plaintiff acquired or should have acquired actual knowledge of the existence of such cause of action.” §§1303(e)(6), (f )(5) (emphasis added); accord, §§1370(f )(1)–(2), 1451(f )(1)–(2). ERISA also requires plaintiffs challenging the suspension of benefits under §1085 to do so within “one year after the earliest date on which the plaintiff acquired or should have acquired actual knowledge of the existence of such cause of action.” §1085(e)(9)(I)(iv). Thus, Congress has repeatedly drawn a “linguistic distinction” between what an ERISA plaintiff actually knows and what he should actually know. Merck, 559 U. S., at 647. And when Congress has included both forms of knowledge in a provision limiting ERISA actions, it has done so explicitly. We cannot assume that it meant to do so by implication in §1113(2). Instead we “generally presum[e] that Congress acts intentionally and purposely when it includes particular language in one section of a statute but omits it in another.” BFP v. Resolution Trust Corporation, 511 U. S. 531, 537 (1994) (internal quotation marks omitted).
Petitioners’ contextual argument fails for the same reason. As they point out, ERISA’s disclosure regime is meant to “ensur[e] 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, p. 11 (1973)). This is the reason for ERISA’s requirements that disclosures be written for a lay audience. See, e.g., 29 U. S. C. §1022(a). Once plan administrators satisfy their obligations to impart knowledge, petitioners say, §1113(2)’s knowledge requirement is satisfied too. But that is simply not what §1113(2) says. Unlike other ERISA limitations periods—which also form §1113(2)’s context—§1113(2) begins only when a plaintiff actually is aware of the relevant facts, not when he should be. And a given plaintiff will not necessarily be aware of all facts disclosed to him; even a reasonably diligent plaintiff would not know those facts immediately upon receiving the disclosure. Although “the words of a statute must be read in their context,” Davis v. Michigan Dept. of Treasury, 489 U. S. 803, 809 (1989), petitioners’ argument again gives the word “actual” little meaning at all.
Finally, petitioners argue that the plain meaning of “actual knowledge” renders an earlier version of §1113(2) incoherent. As originally enacted, the §1113(2) limitations period began either when the plaintiff gained actual knowledge of the alleged breach or when “a report from which [the plaintiff] could reasonably be expected to have obtained knowledge . . . was filed with” the Secretary of Labor. 29 U. S. C. §1113(2) (1976 ed.). That latter, constructive-knowledge clause was later repealed. See Omnibus Budget Reconciliation Act of 1987, §9342(b), 101 Stat. 1330–371. According to petitioners, if “actual knowledge” means what it says, then the original version of §1113(2) charged plan participants with learning what was sent to the Secretary but not what was sent to them.
The version at issue here, however, is the current one—from which Congress removed any mention of constructive knowledge. “When Congress acts to amend a statute, we presume it intends its amendment to have real and substantial effect.” Intel Corp. v. Advanced Micro Devices, Inc., 542 U. S. 241, 258–259 (2004) (internal quotation marks omitted). Section 1113(2)’s history thus more readily suggests that the current version does in fact require actual knowledge.
Nothing in this opinion forecloses any of the “usual ways” to prove actual knowledge at any stage in the litigation. Farmer v. Brennan, 511 U. S. 825, 842 (1994). Plaintiffs who recall reading particular disclosures will of course be bound by oath to say so in their depositions. On top of that, actual knowledge can be proved through “inference from circumstantial evidence.” Ibid.; see also Staples v. United States, 511 U. S. 600, 615–616, n. 11 (1994) (“[K]nowledge can be inferred from circumstantial evidence”). Evidence of disclosure would no doubt be relevant, as would electronic records showing that a plaintiff viewed the relevant disclosures and evidence suggesting that the plaintiff took action in response to the information contained in them. And though, “[a]t the summary judgment stage, facts must be viewed in the light most favorable to the nonmoving party,” that is true “only if there is a ‘genuine’ dispute as to those facts.” Scott v. Harris, 550 U. S. 372, 380 (2007) (quoting Fed. Rule Civ. Proc. 56(c)). If a plaintiff ’s denial of knowledge is “blatantly contradicted by the record,” “a court should not adopt that version of the facts for purposes of ruling on a motion for summary judgment.” 550 U. S., at 380.
Today’s opinion also does not preclude defendants from contending that evidence of “willful blindness” supports a finding of “actual knowledge.” Cf. Global-Tech Appliances, Inc. v. SEB S. A., 563 U. S. 754, 769 (2011).
3 Compare Caputo v. Pfizer, Inc., 267 F. 3d 181, 194 (CA2 2001); Reich v. Lancaster, 55 F. 3d 1034, 1056–1057 (CA5 1995); Gluck v. Unisys Corp., 960 F. 2d 1168, 1176 (CA3 1992); Radiology Center, S. C., v. Stifel, Nicolaus & Co., 919 F. 2d 1216, 1222 (CA7 1990); Brock v. Nellis, 809 F. 2d 753, 754–755 (CA11 1987), with Brown v. Owens Corning Investment Review Comm., 622 F. 3d 564, 571 (CA6 2010) (“Actual knowledge does not require proof that the individual Plaintiffs actually saw or read the documents that disclosed the allegedly harmful investments” (internal quotation marks omitted)).
4 Petitioners cite this dictionary’s somewhat puzzling second definition of “actual knowledge,” which it dubs “implied actual knowledge”: “[k]nowledge of information that would lead a reasonable person to inquire further.” Black’s Law Dictionary 1043 (11th ed. 2019). Not even this entry, however, appears to equate “implied actual knowledge” with “actual knowledge” as normally understood. It instead proceeds to reference the common-law “discovery rule,” ibid., under which a limitations period begins when “the plaintiff discovers (or reasonably should have discovered) the injury giving rise to the claim,” id., at 585 (emphasis added); see also Merck & Co. v. Reynolds, 559 U. S. 633, 646 (2010). As we noted in Merck, that rule is broader than “actual knowledge.” Id., at 647.