Cunningham v. Dun & Bradstreet Plan Services, Inc.

• Decision Date: 12 June 1995
• Docket Number: Civ. A. No. 1:92CV139-D-D.
• Citation: 889 F. Supp. 932
• Parties: Patricia CUNNINGHAM, Plaintiff, v. DUN & BRADSTREET PLAN SERVICES, INC.; Dun & Bradstreet Pension Services, Inc.; J.T. Comer & Associates, a division of Dun & Bradstreet Pension Services, Inc. and Dun & Bradstreet, Inc., Defendants.
• Court: U.S. District Court — Northern District of Mississippi

889 F. Supp. 932

Patricia CUNNINGHAM, Plaintiff, v. DUN & BRADSTREET PLAN SERVICES, INC.; Dun & Bradstreet Pension Services, Inc.; J.T. Comer & Associates, a division of Dun & Bradstreet Pension Services, Inc. and Dun & Bradstreet, Inc., Defendants.

Civ. A. No. 1:92CV139-D-D.

United States District Court, N.D. Mississippi, Eastern Division.

June 12, 1995.

COPYRIGHT MATERIAL OMITTED

Jeffry M. Cox, John Samuel Hill, Albert C. Delgadillo, Tupelo, MS, for plaintiff.

Robert K. Upchurch, Tupelo, MS, for defendants.

MEMORANDUM OPINION

DAVIDSON, District Judge.

Presently before the court is the motion of the defendants to dismiss the plaintiff's claims against them pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure. Finding the motion well taken, the same shall be granted.

FACTUAL SUMMARY¹

At the times relevant to this action, the plaintiff was employed by Pest Management Specialists, Inc. ("PMSI"). Through her status as an employee of PMSI, the plaintiff was a participant and beneficiary of a defined benefit pension plan and a profit sharing plan ("Plans") sponsored by PMSI, which qualified as "employee pension benefit plans" under ERISA. 29 U.S.C. § 1003. The defendants assumed the administration of the plans effective January 1, 1987, from the prior administrator, Personal Money Management, Inc. ("PMMI").

In July of 1986, funds constituting the plaintiff's interests in the plans were transferred out of the plans under the direction of the plan administrator. The plaintiff avers that she was never made aware of this transfer, nor of the potential tax consequences of such a transfer. The plaintiff further alleges that she received correspondence in March of 1993 which implied that her interest in the plans was "still in place" and that this communication failed to inform her of the activities concerning her interests or the potential tax consequences. This failure to inform, the plaintiff charges, resulted in a substantial tax liability on her part.

The plaintiff then filed this action in June of 1992, seeking to recover damages under 29 U.S.C. § 1132(a)(3) of ERISA, as well as under the common law theory of breach of fiduciary duty. The defendants have now moved this court to dismiss the plaintiff's claims.

DISCUSSION

I. STANDARD FOR A MOTION TO DISMISS

A Rule 12(b)(6) motion is disfavored, and it is rarely granted. Clark v. Amoco Production Company, 794 F.2d 967, 970 (5th Cir.1986); Sosa v. Coleman, 646 F.2d 991, 993 (5th Cir.1981). Dismissal is never warranted because the court believes the plaintiff is unlikely to prevail on the merits. Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 1686, 40 L.Ed.2d 90 (1974). Even if it appears an almost certainty that the facts alleged cannot be proved to support the claim, the complaint cannot be dismissed so long as the complaint states a claim. Clark v. Amoco Production Company, 794 F.2d 967, 970 (5th Cir.1986); Boudeloche v. Grow Chemical Coatings Corp., 728 F.2d 759, 762 (5th Cir.1984). "To qualify for dismissal under Rule 12(b)(6), a complaint must on its face show a bar to relief." Clark, 794 F.2d at 970; see also Mahone v. Addicks Utility District, 836 F.2d 921, 926 (5th Cir. 1988); United States v. Uvalde Consolidated Independent School District, 625 F.2d 547, 549 (5th Cir.1980), cert. denied, 451 U.S. 1002, 101 S.Ct. 2341, 68 L.Ed.2d 858 (1981). Dismissal is appropriate only when the court accepts as true all well-pled allegations of fact and, "it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Thomas v. Smith, 897 F.2d 154, 156 (5th Cir.1989) (quoting Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 100-02, 2 L.Ed.2d 80 (1957)); see Mahone v. Addicks Utility District, 836 F.2d 921, 926 (5th Cir.1988); McLean v. International Harvester, 817 F.2d 1214, 1217 n. 3 (5th Cir.1987); Jones v. United States, 729 F.2d 326, 330 (5th Cir. 1984). While dismissal under Rule 12(b)(6) ordinarily is determined by whether the facts alleged, if true, give rise to a cause of action, a claim may also be dismissed if a successful affirmative defense appears clearly on the face of the pleadings. Clark v. Amoco Production Company, 794 F.2d 967, 970 (5th Cir.1986); Kaiser Aluminum & Chemical Sales, Inc. v. Avondale Shipyards, Inc., 677 F.2d 1045, 1050 (5th Cir.1982), cert. denied, 459 U.S. 1105, 103 S.Ct. 729, 74 L.Ed.2d 953.

II. THE PLAINTIFF'S CLAIM ARISING UNDER ERISA

The defendants point out that the plaintiff brings this action for breach of fiduciary duty individually, and seeks recovery of money damages for her own behalf. An ERISA fiduciary is liable for a breach of duty, but any such breach normally only requires that the fiduciary "make good to such plan any losses to such plan resulting from such breach ..." 29 U.S.C. § 1109(a) (emphasis added). As a result, a beneficiary or participant may only bring an action under § 1109(a) for breach of fiduciary on behalf of the plan, and not individually. Massachusetts Mutual Life Ins. Co. v. Russell, 473 U.S. 134, 105 S.Ct. 3085, 87 L.Ed.2d 96 (1985) (emphasis added). Any action that the plaintiff brings under § 1109(a) must be dismissed, for she seeks recovery on her own behalf and not on behalf of the plan.

The plaintiff responds by pointing out that she does not seek recovery under § 1109(a). In fact, the plaintiff relies upon 29 U.S.C. § 1132(a)(3) as a basis for her ERISA claim, which provides that a plan participant or beneficiary may "obtain other appropriate equitable relief." 29 U.S.C. § 1132(a)(3). The plaintiff contends that the money damages she seeks constitute "equitable relief" under § 1132(a)(3) because the plaintiff "seeks to be made whole."

While not specifically addressing the issue before this court, the United States Supreme Court has already addressed the issue of what "equitable relief" under § 1132(a)(3) entails. Mertens v. Hewitt Associates, 508 U.S. ___, 113 S.Ct. 2063, 124 L.Ed.2d 161 (1993). Writing for the court in Mertens, Justice Scalia determined that "equitable relief" as contemplated under § 1132(a)(3) was limited to those remedies that were typically available in equity — e.g., injunction, mandamus and restitution, but not compensatory damages. Mertens, 508 U.S. at ___ - ___, 113 S.Ct. at 2068-70, 124 L.Ed.2d at 170-172; see also Suggs v. American Life Ins. Co., 847 F.Supp. 1324, 1340 (S.D.Miss.1994). This court agrees, and sees no reason to interpret the provision otherwise. This resolution, however, does not automatically end this court's analysis.

The question remains, does the relief that the plaintiff seeks in this case nonetheless constitute "equitable relief?" Traditional equitable relief can take the form of money damages, particularly in the guise of restitution. While the plaintiff has not requested that this court grant injunctive or similar relief, she states that she wishes "to be made whole" via money damages, implying that she seeks restitutionary relief. "Restitutionary relief" has been explained quite well by a sister circuit:

"Restitution is defined as that body of law in which (1) substantive liability is based on unjust enrichment, (2) the measure of recovery is based on defendant's gain instead of plaintiff's loss, or (3) the court restores to the plaintiff, in kind, his lost property or its proceeds." Douglas Laycock, The Scope and Significance of Restitution, 67 Tex.L.Rev. 1277, 1293 (1989). An action in restitution can result in the defendant's payment of money, either because that sum of money was itself the thing unjustly taken or because the thing taken has been converted and can no longer be specifically returned. cites omitted In such a case the payment of money from defendant to plaintiff represents a kind of specific relief rather than compensatory damages.

Crocker v. Piedmont Aviation, Inc., 49 F.3d 735, 747 (D.C.Cir.1995). In the case at bar, the plaintiff has not alleged that the defendants profited from the tax burden placed upon her, nor has she presented any other evidence of unjust enrichment or conversion relating to the ERISA plan. However the plaintiff may seek to cast her claims, she is in fact pleading for compensatory damages. This court is of the opinion that the reasoning in Mertens is equally applicable in this case:

Although they often dance around the word, what plaintiff in fact seeks is nothing more than compensatory damages —monetary relief for all losses ... sustained as a result of the alleged breach of fiduciary duties. Money damages are, of course, the classic form of legal relief. cites omitted And although we have never interpreted the precise phrase "other appropriate equitable relief," we have construed similar language of Title VII of the Civil Rights Act of 1964 (before its 1991 amendments) — "any other equitable relief as the court deems as appropriate," cite omitted — to preclude "awards for compensatory or punitive damages."

Mertens, 508 U.S. at ___-___, 113 S.Ct. at 2068, 124 L.Ed.2d at 169-70. The plaintiff appears to have no viable cause of action arising under this provision of ERISA. The defendants' motion shall be granted as to the plaintiff's action arising under 29 U.S.C. § 1132(a)(3), and that claim shall be dismissed. The plaintiff has asserted no other provision under ERISA which provides relief for her in this matter.

III. PLAINTIFF'S STATE LAW CLAIMS

The plaintiff has also asserted that the actions of the defendants constitute a breach of fiduciary duties arising under Mississippi common law. The defendants seek to dismiss these claims as well by arguing that those claims are preempted by ERISA. ERISA "supersedes any and all State laws insofar as they may now or hereafter relate to any employee benefit plan...." 29 U.S.C. § 1144(a). Preemption under ERISA is "deliberately expansive." Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 45-46, 107 S.Ct. 1549, 1552, 95 L.Ed.2d 39 (1987). "A law `relates to' an...