Opinion ID: 782513
Heading Depth: 2
Heading Rank: 4

Heading: The Claims in the Second Amended Complaint

Text: 19 The Second Amended Complaint contains eleven counts, which can be grouped into three categories of claims, 8 though, as the district court explained, Burstein did not fully specify the connection between his claims and the provisions of ERISA. See Burstein v. Retirement Account Plan for Employees of Allegheny Health, Education and Research Foundation, 263 F.Supp.2d 949, 2002 WL 31319407, at  (E.D.Pa. May 30, 2002). The complaint contains class action allegations, but the issue of class certification is not before us on appeal in view of the fact that the district court denied Burstein's motion to file the Second Amended Complaint. Because we are reversing on some counts of the First Amended Complaint, we deem it appropriate for the district court to reconsider its class certification ruling in light of this opinion. 9 Category One: Claims for Plan Benefits (Counts VII-X) 20 One category of counts (Counts VII-X) in Burstein's Second Amended Complaint involves claims for plan benefits under ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B) 10 against the Plan and the PBGC. 11 21 Count VII asserts that Burstein became eligible to vest in 100% of [his] accrued benefits [w]hen AHERF partially terminated the Plan. SAC ¶¶ 186-189. 22 Count VIII alleges that the PBGC is obligated, as the statutory trustee [i.e., substituted administrator] of the Plan, to pay benefits to Burstein. SAC ¶¶ 190-194. As we explain in note 23, infra, Kasperbauer, at this time, was no longer the administrator of the Plan, and the Plan had PBGC as its substitute administrator. As such, PBGC, as administrator, had the obligation of distributing Plan assets according to statute. Hence, counsel's colloquy, reproduced at note 11, supra, must be understood as relieving all defendants other than the Plan and the Plan's present administrator, PBGC, from liability under the claim for plan benefits. 23 Count IX alleges that the PBGC is statutorily required to insure the payment of all nonforfeitable benefits. SAC ¶¶ 195-200. 24 Count X alleges that because the PBGC collected premiums from AHERF to insure plan assets, the PBGC created an insurer-insured relationship with Plaintiffs obligating the PBGC to pay benefits. SAC ¶¶ 201-206. 25 Taken together, then, Counts VII-X may be read as claims for plan benefits, but only against the Plan and the PBGC. ( But see infra, where we have held that PBGC may be liable as substituted administrator but not as a guarantor. See infra note 23 and Part III(D)). Category Two: Equitable Estoppel Claim (Count VI) 26 Count VI alleges an equitable estoppel claim against Kasperbauer, McConnell, and the Trustees, alleging that they intended to induce, should have anticipated, or in any event are responsible for, Burstein's reliance on misrepresentations in the Plan Brochure and SPD. SAC ¶¶ 179-185. Category Three: Claims for Breach of Fiduciary Duty (Counts I-V) 27 Counts I-V of the Second Amended Complaint allege various breaches of alleged fiduciary duty. Count I alleges that Kasperbauer, McConnell, and the AHERF Trustees breached their fiduciary duties to Burstein in violation of ERISA § 404(a), 29 U.S.C. § 1104(a), by representing, through the Plan Brochure, the SPD and/or verbal communications, that if the Plan was terminated, all participants would automatically become vested and entitled to benefits. 28 Count II alleges that Kasperbauer, McConnell, Mellon Bank, and the AHERF Trustees failed to warn Burstein of AHERF's imminent bankruptcy and the Plan's underfunding. Further, Count II alleges that the defendants had failed to warn Burstein that he had been misled about his benefits under the Plan Brochure and SPD. Count II charges that such failures to warn constitute a failure to discharge fiduciary duties. 29 Count III alleges that Kasperbauer, McConnell, and the AHERF Trustees mismanaged plan assets in one of the most favorable investment climates in history, resulting in an asset shortfall, and allowed an $89 million payment to Mellon Bank. SAC ¶¶ 156-61. 30 Count IV alleges that Mellon Bank mismanaged plan assets and improperly influenced AHERF to make an $89 million payment prior to AHERF's bankruptcy filing. SAC ¶¶ 162-72. 31 Count V alleges that certain AHERF Trustees (Cahouet, Barnes, Gumberg, Adam, and Fletcher) held positions or were affiliated with Mellon Bank, and improperly influenced AHERF to make the $89 million payment to the bank. Burstein claims that this action breached these Trustees' fiduciary duties. SAC ¶¶ 173-178. 32 These claims for breach of fiduciary duty under ERISA are brought pursuant to ERISA § 502(a)(3)(B), 29 U.S.C. § 1132(a)(3)(B). See Varity Corp. v. Howe, 516 U.S. 489, 515, 116 S.Ct. 1065, 134 L.Ed.2d 130 (1996). We discuss these claims infra in Part V. 12