Opinion ID: 670809
Heading Depth: 2
Heading Rank: 1

Heading: ERISA bases for the claim.

Text: 30
31 The Trust Funds first allege that Mark violated ERISA Sec. 515, which provides that 32 [e]very employer who is obligated to make contributions to a multiemployer plan under the terms of the plan or under the terms of a collectively bargained agreement shall, to the extent not inconsistent with law, make such contributions in accordance with the terms and conditions of such plan or such agreement. 33 29 U.S.C. Sec. 1145 (1988) (emphasis added). ERISA defines an employer as any person acting directly as an employer, or indirectly in the interest of an employer, in relation to an employee benefit plan. 29 U.S.C. Sec. 1002(5) (1988). The Trust Funds contended that by agreeing to the joint check provision, Mark was acting indirectly in the interest of an employer because it was in the interest of Stark, the direct employer, for Mark to enter into the subcontract agreeing to make the benefit payments. The district court rejected this argument and dismissed the claim on the ground that Mark was not an employer and thus not subject to the obligations of Sec. 515. 34 Our circuit has never addressed the precise question of whether a nonsignatory to a collective bargaining agreement who agrees in another contract to pay by joint check the benefit contribution obligations of the signatory is a Sec. 1002(5) employer. 7 The district court relied on two of our opinions holding that nonsignatories whose obligations to trust funds are fixed solely by state law cannot be sued as Sec. 515 employers. In Carpenters S. Cal. Admin. Corp. v. D & L Camp Constr. Co., 738 F.2d 999 (9th Cir.1984), we held that a surety company, which held a defaulting contractor's license bond and was therefore required under California state law to protect those damaged by the actions of the contractor, was not an employer under ERISA. Id. at 1000. We stated that 35 Neither the legislative history of ERISA ... nor of its 1980 amendments ... indicate that Congress meant to expand the concept of employer or the jurisdiction of the federal courts to include sureties, whose obligations are fixed by contract and regulated by state law for the protection of the public. 36 The surety that provides a bond pursuant to the California contractor licensing statute is not acting for the benefit of the employer; it is acting for the benefit of those who have been damaged by the employer's failure to pay. [ ...] The protection is aimed at a broad class of entities that deal with contractors, not, as plaintiff would have us believe, primarily as protection of employee benefit plans. Any obligation of the surety to this plaintiff is founded in state, not federal law. 37 Id. at 1000-01 (citations omitted). 38 We followed this reasoning in Carpenters S.Cal. Admin. Corp. v. Majestic Housing, 743 F.2d 1341 (9th Cir.1984), which involved a suit by employee benefit trust funds to enforce a mechanic's lien they had filed against a housing developer. The developer had hired a subcontractor who had failed to make certain fringe benefit contributions due under the terms of a collective bargaining agreement the subcontractor had signed with the union. We held that the developer was not a proper defendant under ERISA Sec. 515 because, like the surety in D & L Camp, it was a non-party to the bargaining agreement that is made responsible by the operation of state [mechanic's lien] law for the failed obligations of the employer. Id. at 1346. 8 39 Mark's posture is analogous to that of the surety in D & L Camp and the developer in Majestic Housing. Mark is not a signatory to the collective bargaining agreement, but only to the contract between Mark and Stark. Any responsibility that Mark may have for Stark's obligations--and it is not clear that it bears any such responsibility 9 --therefore derives from state third-party beneficiary law, not the plan or the collective bargaining agreement. Mark and Stark may well have intended the joint check arrangement to benefit the Trust Funds, although it appears that the arrangement was primarily intended to benefit Mark; 10 but no matter how strong that intent and no matter how strong a state law case the Trust Funds may have against Mark but for federal preemption, the claim asserts a state right of action, not a right under ERISA Sec. 515. 40
41 The Trust Funds next contend that Mark is an ERISA fiduciary and that Mark breached its fiduciary duty by not making the fringe benefit contributions. The district court dismissed the claim on the ground that the Trust Funds had not alleged that Mark possessed any of the indicia of an ERISA fiduciary. 42 Under ERISA, 43 a person is a fiduciary with respect to a plan to the extent (i) he exercises any discretionary authority or discretionary control respecting management of such plan or exercises any authority or control respecting management or disposition of its assets, (ii) he renders investment advice for a fee or other compensation, direct or indirect, with respect to any moneys or other property of such plan, or has any authority or responsibility to do so, or (iii) he has any discretionary authority or discretionary responsibility in the administration of such plan. 44 29 U.S.C. Sec. 1002(21)(A) (1988). As the district court noted, the Trust Funds have not alleged that [Mark] did any of these things or assumed any of these obligations. [ER at 94]. The Trust Funds argue that [f]acts not before this Court on this appeal of dismissal may well show that Mark assumed and breached a fiduciary duty with respect to the contributions. [Blue Brief at 26.] However, this argument is irrelevant, because in reviewing a Rule 12(b)(6) dismissal this court is limited to the facts pleaded in the complaint. Love, 915 F.2d at 1245. In any event, the Trust Funds give no indication of what these facts might be. 45
46 The Trust Funds also contend that in addition to being an ERISA employer, Mark is an ERISA party in interest to an employee benefit plan. ERISA defines such a party in interest as: 47 (A) any fiduciary, ... counsel, or employee of such employee benefit plan; 48 (B) a person providing services to such plan; 49 (C) an employer any of whose employees are covered by such plan; 50 (D) an employee organization any of whose members are covered by such plan; 51 (E) a [50% or more owner of the voting power, capital interest, or beneficial interest of any] employer or ... employee organization described in subparagraph (C) or (D); 52 (F) a relative of [any of the above parties in interest]; 53 (G) a corporation [controlled by any of the above parties in interest]; 54 (H) an employee, officer, director ... or a 10 percent or more shareholder, directly or indirectly, of [any of the above parties in interest]; 55 (I) a 10 percent or more ... partner or joint venturer of [any of the above parties in interest]. 56 29 U.S.C. Sec. 1002(14) (1988). We held above that Mark is not a fiduciary or an employer, and the Trust Funds have not alleged that Mark falls into any of the other categories. Mark is therefore not an ERISA party in interest. 57
58 The Trust Funds' complaint fails to show that Mark is an ERISA employer, fiduciary, or party in interest. Therefore, under no set of facts pleaded in the complaint can the Trust Funds show that Mark owes them the contributions under some ERISA-based duty. We affirm the district court's Rule 12(b)(6) dismissal of the ERISA third-party beneficiary claim. 59