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Hakim v. Accenture United States Pension Plan

September 3, 2009


The opinion of the court was delivered by: Judge Robert M. Dow, Jr.


Plaintiff, Omar Hakim ("Hakim"), filed a putative class action complaint [1] on June 27, 2008 on behalf of himself and all others similarly situated under the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1101 et seq. ("ERISA"), against Accenture United States Pension Plan and Accenture LLP. Subsequently, on September 2, 2008, Plaintiff filed a first amended class action complaint [29] adding additional defendants. The first amended complaint asserts five counts under ERISA against Accenture United States Pension Plan (the "Plan"), Accenture LLP, Accenture Inc., Accenture LLC, and Accenture Ltd. (collectively "Defendants"). Currently before the Court is Defendants'motion to dismiss [59] Plaintiff's first amended complaint pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. For the reasons stated below, Defendants' motion to dismiss is granted in part and denied in part.

I. Background*fn1

On October 4, 1993, Defendant Accenture LLP (then operating as Andersen Consulting LLP) hired Plaintiff to work in its Los Colinas, Texas office. As of the date that he was hired, Plaintiff was a "participant" in the Plan, and accrued benefits under the terms of the Plan.*fn2 Defendants altered the Plan's eligibility requirements in an amendment to the Plan that took effect on July 1, 1996. Under the 1996 Amendment, Plan participants could become ineligible to accrue additional benefits if they switched jobs within Accenture. Plaintiff received no notice of the 1996 Amendment.

On December 16, 1999, Accenture promoted and transferred Plaintiff to a different service line within the company. Pursuant to the 1996 Amendment, Plaintiff's promotion made him ineligible to continue accruing benefits under the Plan. According to Plaintiff, he did not realize that he had stopped accruing benefits until July 7, 2003, when he received his final statement of benefits from Defendants.*fn3 The final benefits statement showed that Plaintiff had accrued benefits for the 6.202 years of service he performed between October 4, 1993 -- when he was first hired -- and December 16, 1999, but that he had accrued no Plan benefits between his promotion on December 16, 1999 and his termination on May 16, 2003. Based on the 6.202 years of service during which Defendants say Plaintiff accrued benefits under the Plan, Plaintiff will be entitled to a monthly benefit payment of $766.28 beginning at age 62. According to Plaintiff, if his monthly benefit were calculated on the basis of his full 9.619 years of service (between October 4, 1993 and May 16, 2003) -- as he claims it should be --he will receive $1,963.76 per month in benefits.

On July 21, 2003, Plaintiff made a written request to Defendants requesting assistance in determining his pension eligibility dates and benefits. In response, on or around July 29, 2003, Defendants provided Plaintiff with a copy of the Plan; at that time, Defendants did not provide Plaintiff with any summary plan descriptions or other documents. On December 12, 2003, Defendants informed Plaintiff that, pursuant to the 1996 Amendment, he had become ineligible to participate in the Plan on December 16, 1999.

Plaintiff later sent Defendants a letter notifying them that he intended to file a lawsuit seeking benefits under the Plan. Defendants responded on July 9, 2007 by informing Plaintiff that he had not exhausted his administrative remedies, and inviting him to do so. On July 27, 2007, Plaintiff made an administrative claim for benefits and an express written request for the plan documents in effect during Plaintiff's service, including plan documents containing "the provisions regarding appeal." Defendants denied Plaintiff's claim for benefits on November 20, 2007. Plaintiff appealed that denial on November 29, 2007; at that time, Plaintiff also made a written request for the plan documents in effect during Plaintiff's service, including "[a]ny and all summary plan descriptions from January 1, 1995 through December 31, 2003." On January 25, 2008, Defendants provided copies of the 1995, 1996, 1997, 1999, 2001, and 2003 summary plan descriptions. Plaintiff's appeal of the denial of his claim for benefits was denied on April 2, 2008. At that time, Defendants informed Plaintiff that he had now exhausted his administrative remedies under the Plan' s terms, and notified him that could "exercise his right to bring a civil lawsuit in federal court under Section 502(a) of ERISA to challenge this adverse benefit determination" within 120 days of the date of the letter.

Plaintiff filed this putative class action on June 27, 2008. Count I seeks equitable relief pursuant to ERISA § 502(a)(3), 29 U.S.C. §1132(a)(3), for Defendants' alleged failure to provide timely notice of the 1996 Amendment in violation of ERISA § 204(h), 29 U.S.C. § 1054(h) (1996). Count II sets forth an identical claim for equitable relief under ERISA § 502(a)(3) for Defendants'alleged failure to provide proper notice of the 1996 Amendment (including notice of the amendment' s wording and the fact that it might reduce benefits), as required by ERISA § 204(h). Count III, which also seeks equitable relief pursuant to ERISA § 502(a)(3), alleges that Defendants violated ERISA § 102, 29 U.S.C. § 1022, by failing to provide Summary Plan Descriptions ("SPDs") that contained comprehensible descriptions of the Plan's eligibility requirements and the circumstances that may result in disqualification, ineligibility or denial or loss of benefits.

The equitable relief that Plaintiff requests in each of Counts I-III consists of an order declaring the 1996 Amendment ineffective and "the incidental monetary relief mechanically flowing from that injunctive relief" in an amount equal to the difference between the pension benefits as calculated under the 1996 Amendment and as re-calculated under the terms of the pre-Amendment Plan.

Count IV sets forth an alternative claim for benefits under ERISA § 502(a)(1)(B), 29 U.S.C. §1132(a)(1)(B), based on the statutory violations alleged in Counts I-III. In Count IV, Plaintiff seeks damages in an amount equal to the difference between the pension benefits as calculated under the 1996 Amendment and as re-calculated under the terms of the pre-Amendment Plan. Thus, the "damages" sought in the alternative in Count IV are identical to the "incidental monetary relief" sought in Counts I-III.

Count V seeks statutory damages pursuant to ERISA § 502(c)(1), 29 U.S.C. §1132(c)(1), for Defendants'alleged failure, upon written request, to provide Plaintiff with SPDs that complied with ERISA § 104.

II. Legal Standard On Motion To Dismiss

A motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6) tests the sufficiency of the complaint, not the merits of the case. See Gibson v. City of Chicago, 910 F.2d 1510, 1520 (7th Cir. 1990). To survive a Rule 12(b)(6) motion to dismiss, the complaint first must comply with Rule 8(a) by providing "a short and plain statement of the claim showing that the pleader is entitled to relief" (Fed. R. Civ. P. 8(a)(2)), such that the defendant is given "fair notice of what the * * * claim is and the grounds upon which it rests." Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47 (1957)). Second, the factual allegations in the complaint must be sufficient to raise the possibility of relief above the "speculative level," assuming that all of the allegations in the complaint are true. E.E.O.C. v. Concentra Health Servs., Inc., 496 F.3d 773, 776 (7th Cir. 2007) (quoting Twombly, 550 U.S. at 555). "[O]nce a claim has been stated adequately, it may be supported by showing any set of facts consistent with the allegations in the complaint." Twombly, 550 U.S. at 563. The Court accepts as true all of the well-pleaded facts alleged by the plaintiff and all reasonable inferences that can be drawn therefrom. See Barnes v. Briley, 420 F.3d 673, 677 (7th Cir. 2005).

On a Rule 12(b)(6) motion to dismiss, the Court generally must confine its inquiry to the factual allegations set forth within the four corners of the operative complaint. See Rosenblum v., 299 F.3d 657, 661 (7th Cir. 2002). In the usual case, therefore, if a party moving for a 12(b)(6) dismissal submits documents with its motion to dismiss, the Court either must ignore the documents or convert the motion to one for summary judgment. See Fed. R. Civ. Pro. 12(b); Venture Assoc. Corp. v. Zenith Data Sys. Corp., 987 F.2d 429, 431 (7th Cir. 1993). However, "[d]ocuments that a defendant attaches to a motion to dismiss are considered part of the pleadings," and may be considered on a motion to dismiss, "if they are referred to in the plaintiff's complaint and are central to her claim." Venture, 987 F.2d at 431. Documents that fall within this "narrow" exception must be "concededly authentic." Tierney v. Vahle, 304 F.3d 734, 738 (7th Cir. 2002).

Here, the Court will consider three categories of documents that were not attached to the complaint: (1) the 1997, 1999, 2001, and 2003 SPDs*fn4 ; (2) the General Information portions of the 1995, 1997, 1999, 2001, 2003, 2005, and 2007 SPDs*fn5 ; and (3) Plaintiff's written requests to Defendants for information and Defendants' responses.*fn6

III. Analysis

A. Motion to Dismiss Claims for Equitable Relief Under ERISA § 502(a)(3) Set Forth in Counts I-III

In Counts I-III, Plaintiff seeks equitable relief pursuant to ERISA § 502(a)(3) for Defendants' alleged violations of ERISA §§ 204(h) and 102. ERISA § 502(a)(3) provides that a civil action may be brought "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." Defendants move to dismiss Counts I-III on the grounds that (1) equitable relief under § 502(a)(3) is not available as a matter of law because Plaintiff has a claim for benefits under § 502(a)(1)(B) (which he asserts in Count IV); and (2) even if Plaintiff could assert claims under § 502(a)(3), the monetary relief that he seeks is not "appropriate equitable relief" within the meaning of the statute. Because the Court finds that dismissal of Counts I-III is warranted based on Defendants'first argument, it will not reach their second contention regarding the availability of monetary relief under § 502(a)(3).

For their first argument --that Plaintiff cannot maintain a claim under § 502(a)(3) because he has an adequate remedy under § 502(a)(1)(B) -- Defendants rely on the Supreme Court' s discussion of § 502(a)(3) in Varity Corporation v. Howe, 516 U.S. 489 (1996). In Varity, the Court described § 502(a)(3) as a "catchall" provision that acts "as a safety net, offering appropriate equitable relief for injuries caused by violations that § 502 does not elsewhere adequately remedy." 516 U.S. at 512. The Court noted that "the statute authorizes [only] ' appropriate'equitable relief," and stated that "equitable relief * * * normally would not be ' appropriate'* * * where Congress elsewhere provided adequate relief for a beneficiary's injury." Id. at 515.

The Seventh Circuit has not determined whether, under Varity, a claim for benefits under § 502(a)(1)(B) bars a § 502(a)(3) claim for equitable relief. However, as the Seventh Circuit recently recognized, "a majority of the circuits" have interpreted Varity to mean that "if relief is available to a plan participant under subsection (a)(1)(B), then that relief is unavailable under subsection (a)(3)." Mondry v. American Family Mut. Ins. Co., 557 F.3d 781, 805 (7th Cir. 2009) (citing Korotynska v. Metro. Life Ins. Co., 474 F.3d 101, 106 (4th Cir. 2006) (joining the 5th, 6th, 8th, 9th, and 11th Circuits in holding that "a claimant whose injury creates a cause of action under § 1132(a)(1)(B) may not proceed with a claim under § 1132(a)(3)")). Likewise, a number of "judges of this court have interpreted [Varity] to mean that a claim for equitable relief under § 1132(a)(3) must be dismissed if relief may be obtained under § 1132(a)(1)(B)." Rice ex rel. Rice v. Humana Ins. Co., 2007 WL 1655285, at *4 (N.D. Ill. June 4, 2007); see also Heroux v. Humana Ins. Co., 2005 WL 1377854, at *4 (N.D. Ill. June 8, 2005) (at motion to dismiss stage, stating that a §1132(a)(3) claim "would be foreclosed by the relief [sought] * * * under § 1132(a)(1)(B)"); Erikson v. Ungaretti & Harris-Exclusive Provider Plan, 2003 WL 22836462, at *3 (N.D. Ill. Nov. 24, 2003) (granting motion to dismiss § 502(a)(3) claim that rested "on the exact same basis as [plaintiff's] claims for denial of benefits" under § 502(a)(1)(B)); Clark v. Hewitt Associates, LLC, 294 F.Supp.2d 946, 950 (N.D. Ill. 2003) (holding that a plaintiff who has the right to bring a claim under ERISA § 502(a)(1)(B), regardless of its merits, may not seek relief under ERISA § 502(a)(3)); Jurgovan v. ITI Enterprises, 2004 WL 1427115, at *4 (N.D. Ill. June 23, 2004) (granting motion to dismiss ERISA § 502(a)(3) claim under Varity where plaintiff had a claim for benefits under § 502(a)(1)(B)).

This is not to say that an ERISA plaintiff may never simultaneously bring claims under both § 502(a)(1)(B) and § 502(a)(3). Gore v. El Paso Energy Corp. Long Term Disability Plan, 477 F.3d 833, 839-40 (6th Cir. 2007) (dismissal of § 502(a)(3) claim is appropriate where it is merely "a repackaged claim for individual benefits," but not where plaintiff's § 502(a)(3) claim and § 502(a)(1)(B) claim address "two separate and distinct injuries"). Courts generally are in agreement that where a plaintiff's § 502(a)(3) and § 502(a)(1)(B) claims are largely indistinguishable (i.e., "the equitable claims * * * are ' nothing more than repackaged denial of benefits claims"), the equitable claims must be dismissed. Crummett v. Metropolitan Life Ins. Co., 2007 WL 2071704, at *2 (D.D.C. July 16, 2007) (citation omitted). For example, courts consistently have dismissed § 502(a)(3) claims where a plaintiff seeks identical relief under §§ 502(a)(3) and 502(a)(1)(B). See Rice, 2007 WL 1655285, at *4 (granting motion to dismiss ERISA § 502(a)(3) claim where plaintiff also asserted ERISA § 502(a)(1)(B) claim and sought identical relief under both claims); Kaliebe, 2003 WL 22282379, at *3 (dismissing § 502(a)(3) claim where beneficiary sought the same remedy -- "restoration of the level of benefits that the beneficiary believes to have been required under the plan" -- for claims under §§ 502(a)(3) and 502(a)(1)(B)); Erikson, 2003 WL 22836462, at *3 ("Unless [plaintiff] can state that she is entitled to some type of relief that would be unavailable to her under § 502(a)(1)(B), she may not bring a claim under § 502(a)[](3)."); Jurgovan, 2004 WL 1427115, at *4 (plaintiff's "§ 502(a)(3) claim * * * must be dismissed because it seeks relief which duplicates the relief sought in her claim for benefits under § 502(a)(1)(B)"); Wald v. Southwestern Bell Corp. Customcare Medical Plan, 83 F.3d 1002, 1006 (8th Cir. 1996) (finding that plaintiff did "not have a cause of action under section 502(a)(3)" where she sought "no different relief" under § 502(a)(3) than she did under § 502(a)(1)(B)). Similarly, courts have concluded that where a plaintiff's §§ 502(a)(3) and 502(a)(1)(B) claims rely on identical the factual allegations, the § 502(a)(3) must be dismissed. See Jones v. American General Life and Acc. Ins. Co., 370 F.3d 1065, 1073 (11th Cir. 2004) ("the relevant concern in Varity, in considering whether the plaintiffs had stated a claim under Section 502(a)(3), was whether the plaintiffs also had a cause of action, based on the same allegations, under Section 502(a)(1)(B) or ERISA' s other more specific remedial provisions"); Moffat v. Unicare Midwest Plan Group 314541, 2005 WL 1766372, at *5 (N.D. Ill. July 25, 2005) (dismissing plaintiff's § 502(a)(3) claim where the same allegations supported plaintiff's § 502(a)(1)(B) claim).

By contrast, courts have declined to dismiss § 502(a)(3) claims that are not simply "repackaged" claims for benefits. See Ehrman v. Standard Ins. Co., 2007 WL 1288465, at *4 (N.D. Cal. May 2, 2007) (refusing to dismiss § 502(a)(3) claim at pleading stage where the plaintiff "alleged wrongful conduct that * * * [went] beyond the mere wrongful calculation of benefits" and thus § 502(a)(1)(B) might not provide complete relief); Black v. Long Term Disability Ins., 373 F.Supp.2d 897, 902 (E.D. Wis. 2005) (motion to dismiss § 502(a)(3) claim should be denied under certain circumstances, including where plaintiff alleges one set of facts in support of § 502(a)(1)(B) claim and different facts in support of § 502(a)(3) claim); Hill v. Blue Cross and Blue Shield of Mich., 409 F.3d 710, 718 (6th Cir. 2005) (holding that district court ...

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