Opinion ID: 453346
Heading Depth: 2
Heading Rank: 1

Heading: ERISA Jurisdictional Provisions

Text: 14 Federal jurisdiction over Mrs. Fazio's original suit was unassailable. ERISA, at 29 U.S.C. Sec. 1132, provides, in pertinent part, that: 15 (a) A civil action may be brought-- 16 (1) by a participant or beneficiary-- 17   (B) to recover benefits due to him under the terms of the plan, to enforce his right under the terms of the plan, or to clarify his rights to future benefits under the plan ... 18 Mrs. Fazio is a beneficiary of the Teamsters plan and a participant of the ILGWU plan, 2 and her suit was brought to recover benefits, to enforce rights, and to clarify rights to future benefits under the terms of these plans. Thus, if Mrs. Fazio had remained a party to this action, the district court unquestionably could have exercised jurisdiction pursuant to 29 U.S.C. Sec. 1132(a)(1)(B). 19 Jurisdiction over the present suit between the ILGWU and Teamsters Funds, in the absence of the participation of Mrs. Fazio, is much more problematic. Neither the ILGWU Fund, its trustee Hoffman, nor the Teamsters Fund is a participant or beneficiary under the terms of either benefits plan. See supra note 2 (definitions). The parties argue that the district court had jurisdiction under Sec. 1132(a)(1)(B) nevertheless. According to both the ILGWU and Teamsters Funds, the ILGWU Fund has the capacity to sue under this provision as a representative of all the participants and beneficiaries of the ILGWU Fund who are also beneficiaries of the Teamsters Fund and who are being harmed or who will be harmed in the future by the operation of the Teamsters Fund's interpretation of its plan. In essence, the parties argue that, although Mrs. Fazio no longer has a claim, and although the procedure is not expressly authorized by ERISA, the trustees of one fund can stand in the shoes of certain aggrieved beneficiaries of another fund and sue on their behalf. 20 Two cases from other circuits lend some support to this contention. In International Association of Bridge, Structural and Ornamental Iron Workers Local No. 111 v. Douglas, 646 F.2d 1211 (7th Cir.1981), the Seventh Circuit held that a union has standing to sue under Sec. 1132(a)(1)(B) on behalf of its members in order to clarify their future rights to benefits under a pension plan. The court did not, however, attempt to reconcile this result with the express words of the statutory provision--which do not include unions among the persons or entities that may bring suit. The other case relied upon by the ILGWU and Teamsters Funds is Fentron Industries v. National Shopmen Pension Fund, 674 F.2d 1300 (9th Cir.1982). In Fentron, the Ninth Circuit, relying on Association of Data Processing Service Organizations, Inc. v. Camp, 397 U.S. 150, 90 S.Ct. 827, 25 L.Ed.2d 184 (1970), determined that a party has standing to sue under a federal statute if his alleged injury fall[s] arguably within the zone of interests protected by the statute allegedly violated, so long as the statute itself does not preclude the suit. Id. at 1304. Using this test, the court decided that an employer suing a pension plan on behalf of aggrieved employees has standing under ERISA. The court stated that the omission of employers from 29 U.S.C. Sec. 1132 is not significant in this regard, id. at 1305, holding that since [t]here is nothing in the legislative history to suggest that ... the list of parties to sue under this section is exclusive[,] ... the statute does not prohibit employers from suing to enforce [ERISA's] provisions. Id. 21 During the pendency of this appeal, another panel of this court rejected a liberal reading of Sec. 1132(a)(1)(B). In New Jersey State AFL-CIO v. New Jersey, 747 F.2d 891 (3d Cir.1984), a labor union sued the State of New Jersey in federal court for a declaratory judgment that four New Jersey statutes were invalid because they were preempted by ERISA. The panel held that this case did not arise under the jurisdictional provisions of ERISA because: 22 only participants and beneficiaries may bring suit (in either state or federal court) to clarify rights to future benefits under the terms of the plan. 29 U.S.C. Sec. 1132(a)(1)(B). The statute defines participants as employees or former employees who are, or may be, eligible to receive benefits ... and beneficiaries as people designated by a participant who may become eligible to receive benefits.... It is clear from the statute that labor unions are neither participants nor beneficiaries, and consequently plaintiff does not fall within this provision. Id. at 892 (emphasis added). 23 Id., slip op. at 4. Although AFL-CIO does not directly control the question whether a benefit fund (as opposed to a labor union) can sue under Sec. 1132(a)(1)(B), we believe that the case implicitly adopted the view that Sec. 1132 must be read narrowly and literally. 3 Such a reading precludes the interpretation that a pension fund or a trustee (fiduciary) of a fund can sue under Sec. 1132(a)(1)(B) on behalf of participants or beneficiaries. Accordingly, we hold that jurisdiction over this suit cannot be predicated on 29 U.S.C. Sec. 1132(a)(1)(B). The Second Circuit, also faced with a suit brought by an employee benefit fund, reached this same conclusion. 4 24 The parties argue in the alternative that federal jurisdiction over this action may be predicated on 29 U.S.C. Sec. 1132(a)(3). This section of ERISA provides that a civil action may be brought: 25 (3) by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which 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.... 26 According to the ILGWU and Teamsters Funds, this suit can be characterized as one being brought by ILGWU trustee Hoffman, who is a fiduciary under the terms of ERISA, to enforce the terms of the ILGWU plan against the Teamsters Fund, thereby bringing it within the scope of this statutory provision. This analysis, although perhaps superficially appealing, is based on an untenable legal fiction. The Teamsters Fund is not a party to the ILGWU plan, and it has not violated or threatened to violate the terms of that plan. Thus, it cannot be said that the terms of the ILGWU plan are being enforced against the Teamsters Fund through this lawsuit. The persons who have the power and the duty to enforce the relevant portions of the ILGWU plan are the ILGWU Fund trustees themselves, and the Teamsters Fund is not preventing them from carrying out their obligations. 27 The parties have another way of characterizing the present suit in an attempt to bring it within Sec. 1132(a)(3). They claim that this action can be viewed as a suit by Hoffman, a fiduciary under ERISA, to enforce the terms of the Teamsters plan--which he contends are presently being misread to deny benefits to Mrs. Fazio and persons similarly situated. We believe that such an interpretation of Sec. 1132(a)(3) would distort the plain language of this provision. Section 1132(a)(3) contemplates fiduciaries suing to enforce the terms of the plan, meaning the terms of the plan regarding which they have a fiduciary duty. Indeed, this interpretation is also compelled by the fact that one's status as fiduciary under ERISA is dependent upon one's relationship to a particular plan. ERISA provides that a person is a fiduciary with respect to a plan to the extent ... he exercises any discretionary authority or discretionary control respecting management of such plan or ... disposition of its assets.... 29 U.S.C. Sec. 1002(21)(A). Jurisdiction cannot be predicated on the mere coincidence that Hoffman is a fiduciary of a benefit plan unrelated to the one which he seeks to enforce. 5 28 For the foregoing reasons, we hold that the express jurisdictional provisions of ERISA, found in 29 U.S.C. Sec. 1132, do not authorize federal jurisdiction over a suit, such as the one at bar, brought by a pension fund and its trustee against another pension fund. 6 29