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COUNTY MUNICIPAL EMPLOYEES' v. LABORERS' PENSION FUND

January 22, 2003

COUNTY, MUNICIPAL EMPLOYEES' SUPERVISORS AND FOREMAN'S UNION LOCAL NO. 1001, PLAINIFF,
v.
LABORERS' PENSION FUND, ET AL., DEFENDANTS



The opinion of the court was delivered by: Milton I. Shadur, Senior United States District Judge

MEMORANDUN OPINION AND ORDER

Defendant employee benefit funds (collectively "Funds") have moved to dismiss the Complaint brought against them by County, Municipal Employees' Supervisors and Foreman's Union Local No. 1001 ("Union"), which seeks declaratory relief on behalf of certain Union officers under the auspices of ERISA.*fn1 By a separate motion, Funds also seek sanctions under Fed.R.Civ.P. ("Rule") 11 "for filing a Complaint that is unwarranted under existing law and that has no proper purpose" (Rule 11 Motion at 1) This memorandum opinion and order is issued to address the issues as focused by Funds' motions and by Union's recently-filed response to the dismissal motion,

Motion To Dismiss

Essentially Union seeks to avoid the literal application of Section 1132(a)(3), as to its designation of the categories of plaintiffs who are qualified to bring such ERISA actions, by asserting that the terms "participant" and "fiduciary" (two of the three classes of eligible plaintiffs under Section 1132(a)(3)) should be read broadly enough to embrace Union. That being so, the springboard for discussion must begin with the statutory definitions of those terms in Sections 1002(7) and 1002(21)(A) respectively:

The term "participant" means any employee or former employee of an employer, or any member or former member of an employee organization, who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees off such employer or members of such organization, or whose beneficiaries may be eligible to receive any such benefit.
Except as otherwise provided in subparagraph (B), 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. Such term includes any person designated under section 1105(c)(1)(B) of this title.

And here is the ERISA provision (Section 1132(a)(3)) under which Union claims authorization to bring this lawsuit:

A civil action may be brought —

***

(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 off the plan.

It is apparent that Union fits neither of those two Section 1002 definitions (either "participant" or "fiduciary") as framed by Congress. But even though such specific statutory definitions of terms used elsewhere in the same statute would normally make those defined words terms of art to be read precisely as written, Union seeks to call upon some limited language in some judicial opinions as seemingly expanding (or perhaps as redefining) what Congress has itself said.

To that end Union points primarily to a brief statement in Int'l Ass'n of Bridge, Structural & Ornamental Iron Workers Local No. 111 v, Douglas, 646 F.2d 1211, 1214 (7th Cir. 1981), where the court said as to a plaintiff union that had brought suit on behalf of its members regarding plan benefits:

Local 111 has not withdrawn from the Plan but rather continues to be a participating Union.

That statement was then followed by the court's quotation of Section 1132(a)(1)(B) (which allows a "participant . . . to clarify his rights to future benefits under the terms of the plan"), followed in turn by the court's statement that Local 111 was seeking such a ...


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