Opinion ID: 199274
Heading Depth: 2
Heading Rank: 3

Heading: Restitution of Appreciated Value of Assets

Text: 27 Denman argues that the district court erred in ordering restitution of the earned income by ordering restitution of the appreciated value of the disputed assets, $1,091,788.40 at the time of judgment. The district court ordered State Street to transfer the actual assets misallocated by Northern Trust -- mutual fund shares and a small amount of cash in a short term investment fund -- back to the Eagle Plan. We are guided by comment a to the Restatement (First) of Restitution § 1 that [a] person obtains restitution when he is restored to the position he formerly occupied either by the return of something which he formerly had or by the receipt of its equivalent in money. The investments of the disputed assets remained the same from the time they were misallocated from the Eagle Plan, throughout the time they were in the Denman Plan's account, and until the date judgment entered. At least in theory, mutual funds increase in value over time, like money in a bank. In this case, the investments yielded returns. Had the $602,462.44 remained in the Eagle Plan's account, the Eagle Plan would have seen those assets appreciate similarly. The misallocated funds are identifiable and their present monetary value has been established. That the assets might have been invested differently had they remained in the Eagle Plan does not alter the analysis, nor make the matter so speculative as to deny an award, cf.Cambridge Plating Co. v. Napco, Inc., 85 F.3d 752, 771 (1st Cir. 1996) (Because every calculation of lost profits has some element of uncertainty, a plaintiff need not calculate lost profits with mathematical exactness.) (internal quotation marks omitted). Thus, the district court properly ruled that the Eagle Plan is entitled to restitution of the appreciated assets. Cf. Luby, 944 F.2d 1179 (awarding restitution with interest of mistakenly paid benefits). 28 This case is unlike Kwatcher, where we noted that the employer was entitled to restitution of its overpayments only, as awarding interest that accrued while the funds were retained by the pension plan would offend ERISA's anti-inurement principle by benefitting the employer at the expense of the plan. See 879 F.2d at 967. Here, the Eagle Plan is entitled torestitution of its assets and the gains realized while in the Denman Plan's account, gains which will inure to the benefit of the Eagle Plan's participants. Moreover, the court ordered restitution of the trust corpus itself (the assets in their present, appreciated form), not a fixed cash award; that the Eagle Plan elected to have the assets returned in their cash equivalent, rather than the mutual fund shares, does not change our conclusion.