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No ERISA Payout for Law Firm Employee

An Alexandria U.S. District Court grants a law firm partial judgment on the pleadings in an ERISA suit filed by an employee who resigned after working seven years for the law firm, and then sued when the firm allegedly told him it could not pay him benefits under the firm’s ERISA plan because the Adjusted Funding Target Attainment Percentage for the plan was less than 60 percent.

Section 502(a) of ERISA provides a plan participant or beneficiary with a civil cause of action against a benefit plan fiduciary for a breach of fiduciary duty under 29 U.S.C. § 1109(a). However, the Supreme Court concluded that a Section 502(a)(2) claim for relief does not allow individual participants or beneficiaries to recover damages for themselves. Rather, parties who sue under Section 502(a)(2) must do so as a representative of a benefit plan and its participants and beneficiaries to recover damages for themselves. Rather, parties who sue under Section 502(a)(2) must do so as a representative of a benefit plan and its participants and beneficiaries as a whole.

Here, plaintiff fails to state a claim in count III on which recovery can be had because Section 502(a)(2) unequivocally prohibits recovery for individualized equitable relief. Plaintiff expressly states in his opposition to this motion that count III is brought pursuant to Section 502(a) and seeks the requisite plan-related relief in addition to individualized equitable relief.

The other allegations in count III, taken together, overwhelmingly demonstrate plaintiff seeks defendant’s removal as trustee based upon individualized harms to plaintiff and not in a representative capacity on behalf of the plan and its beneficiaries. Even if the pleadings sufficiently demonstrate that the plaintiff seeks plan-related relief in count III, the fact that plaintiff also seeks proscribed individualized equitable relief would still foreclose a recovery under Section 502(a)(2).

The court also dismissed plaintiff’s count V claim under Section 510 of ERISA, as he does not and cannot allege that defendant named principal of the law firm, or any other defendant, took any adverse employment action against him. Plaintiff voluntarily resigned from the firm and does not allege any adverse conduct during his employment. It was months after his resignation that he alleges the named principal interfered with plaintiff’s rights under the plan.

Because the Section 510 claim admittedly arose after the employer-employee relationship was terminated, plaintiff cannot satisfy the adverse employment action requirement.

Harold v. Leffler & Mosley PC Defined Benefit Pension Plan (Hilton) No. 1:12cv389, Aug. 30, 2012; USDC at Alexandria, Va. VLW 012-3-437, 9 pp.

VLW 012-3-437


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