Altshuler v. Animal Hosps., Ltd.

• Decision Date: 31 October 2012
• Docket Number: Civil Action No. 11–10901–RGS.
• Citation: 901 F.Supp.2d 269
• Parties: Dr. Jennifer Usiak ALTSHULER v. ANIMAL HOSPITALS, LTD. d/b/a The Animal Hospital of Lynnfield, and Dr. Christopher Meehl.
• Court: U.S. District Court — District of Massachusetts

901 F.Supp.2d 269

Dr. Jennifer Usiak ALTSHULER

v.ANIMAL HOSPITALS, LTD. d/b/a The Animal Hospital of Lynnfield, and Dr. Christopher Meehl.

Civil Action No. 11–10901–RGS.

United States District Court, D. Massachusetts.

Oct. 31, 2012.

Paul F. Kelly, James A.W. Shaw, Kevin C. Merritt, Segal Roitman, LLP, Boston, MA, for Dr. Jennifer Usiak Altshuler.

John J. McGivney, Rubin & Rudman, LLP, Boston, MA, for Animal Hospitals, Ltd. d/b/a The Animal Hospital of Lynnfield, and Dr. Christopher Meehl.

MEMORANDUM AND ORDER ON CROSS–MOTIONS FOR SUMMARY JUDGMENT

STEARNS, District Judge.

Plaintiff veterinarian Dr. Jennifer Usiak Altshuler (Dr. Usiak, as that is her professional name) brought this lawsuit against her former employer, Animal Hospitals Ltd., d/b/a The Animal Hospital of Lynnfield (AHL), and its president, Dr. Christopher Meehl. The gist of the Complaint involves Dr. Meehl's failure to make timely deposits of withheld contributions to Dr. Usiak's Simple IRA retirement savings account. Dr. Usiak also brings a claim of retaliatory discharge in violation of the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1002 et seq. Having completed discovery, the parties now each move for summary judgment.

BACKGROUND

Dr. Meehl and his wife, LuAnn, are the owners of AHL, a small veterinary hospital that employs four doctors and a full-time staff of fewer than twenty people. In April of 2007, Dr. Usiak joined AHL as a relief veterinarian. She became a full time employee in June of 2007.¹ In April of 2009, Dr. Usiak elected to participate in a Simple IRA retirement plan sponsored by AHL. Dr. Meehl served as the plan administrator.² Dr. Usiak chose to contribute $250 biweekly to her plan account.³

Under the terms of the plan, AHL was required to deposit an employee's contribution into his or her plan account within 30 days of the month in which the employee deduction was made.⁴ At the beginning of 2011, Dr. Usiak discovered that AHL had deposited into her account only 65% of the money withheld from her pay in 2010, and that the contributions for September, October, and November were overdue.

On January 6, 2011, Dr. Usiak spoke with Ellen Saltzman, AHL's business manager, about the missing deposits. Saltzman directed Dr. Usiak to Brian Haley, AHL's bookkeeper, who then happened to be on the premises.⁵ Haley told Dr. Usiak that he had been pressing Dr. Meehl to make more timely deposits to the retirement accounts.

Dr. Usiak then approached Dr. Meehl. He apologized for being late with the deposits. He stated that the recession had adversely impacted AHL's business, ⁶ and that his primary concern had been to protect the jobs of AHL's employees.⁷ Dr. Meehl promised to work with Haley to bring the accounts up to date, although he could not guarantee that all future deposits would be made on time. On January 17, 2011, Dr. Usiak withdrew from the AHL retirement plan. On February 1, 2011, she learned that AHL had still not made her November and December of 2010 deposits. Dr. Usiak confronted Dr. Meehl and told him that it was illegal for him to withhold the retirement contributions. Dr. Meehl stated that he would catch up as quickly as possible, and blamed his tardiness on the heavy snowstorms that had prevented Haley from performing the necessary bookkeeping services. Dr. Meehl noted that AHL had always deposited its matching contributions in advance of their annual due date. Rejecting the explanation, Dr. Usiak likened Dr. Meehl to the notorious Ponzi schemer, Bernie Madoff. Later that day, as she left work early because of a snowstorm, Dr. Usiak encountered Dr. Meehl shoveling snow from the Hospital's steps. The argument over the late deposits resumed, and ended in a heated exchange.⁸ By February 4, 2011, AHL had made all of the outstanding deposits to Dr. Usiak's retirement account, as well as an interest payment of $24.00 (as calculated by the Department of Labor's online Voluntary Fiduciary Correction Program).

On February 11, 2011, Dr. Meehl hand-delivered a termination letter to Dr. Usiak. The letter stated that “[Dr. Usiak] ha[d] made it clear that [she] no longer trust[ed] [Dr. Meehl] and [his] management when they spoke on January 6th and on February 1st regarding the hospital Simple IRA.” Defs.' Ex. 1 at Ex. A. While acknowledging Dr. Usiak's frustration over the retirement plan deposits, the “comparison [to Bernie Madoff] [wa]s just too grievous an insult for [Dr. Meehl] to believe that [they] have a proper foundation on which to continue working together in the spirit of mutual trust and respect,” and that “[a] lack of mutual trust ma[de] a successful working relationship impossible.” Id.⁹ AHL paid Dr. Usiak for all of the time she had worked prior to the termination and reimbursed all of her accrued leave time.

On February 28, 2011, Dr. Usiak's lawyer wrote to AHL protesting her “unlawful” termination, and threatening a lawsuit in federal court if the wrong was not redressed. Dr. Meehl responded on March 11, 2011, offering to reinstate Dr. Usiak. Dr. Meehl wrote that while he and his wife had been offended by the Madoff slur, he did “not believe terminating [Dr. Usiak's] employment was a tempered response to [her] comment, especially in light of the allegations [Dr. Usiak's] attorney has made.” ¹⁰Id. at Ex. B. Dr. Meehl stated that it was “his intention to make the return easy for [Dr. Usiak].” Id.¹¹ In addition, AHL voluntarily deposited $7,689.01 into Dr. Usiak's checking account to compensate her for the time that she had missed from work.

Dr. Usiak rejected the offer of reinstatement and brought this lawsuit. ¹² Her Amended Complaint, filed in June of 2011, lists seven Counts—conversion (Count I),¹³ breach of fiduciary duty (Count II), interference in violation of ERISA (Count III), retaliatory discharge in violation of ERISA (Count IV), wrongful discharge in violation of Massachusetts public policy (Count V), failure to timely pay wages in violation of the Massachusetts Wages Act (Count VI), and retaliatory discharge under the Massachusetts Wage Act (Count VII). AHL and Dr. Meehl move for summary judgment on Counts II through VII, while Dr. Usiak moves for summary judgment on Counts II through IV. The court heard argument from counsel on October 26, 2012.

DISCUSSION

Summary judgment is appropriate when “the movant shows that there is no genuinedispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a). “A ‘genuine’ issue is one that could be resolved in favor of either party, and a ‘material fact’ is one that has the potential of affecting the outcome of the case.” Calero–Cerezo v. U.S. Dep't of Justice, 355 F.3d 6, 19 (1st Cir.2004), citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248–250, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). The moving party bears the burden of establishing that there is no genuine issue of material fact. See Celotex Corp. v. Catrett, 477 U.S. 317, 322–323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). “The evidence of the non-movant is to be believed, and all justifiable inferences are to be drawn in his favor.” Anderson, 477 U.S. at 255, 106 S.Ct. 2505.

Cross-motions as to Count II—Breach of Fiduciary Duty

With respect to this claim, the facts are not in dispute. As Dr. Usiak notes, Dr. Meehl, as the AHL retirement plan administrator, acts in a fiduciary capacity with respect to participating employees. See29 U.S.C. § 1002(21)(A) (“[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 ... or (iii) he has any discretionary authority or discretionary responsibility in the administration of such plan.”). Moreover, it is not disputed that Dr. Meehl breached his fiduciary duty by detaining account deposits, and using employee ERISA contributions to defray the operating costs of AHL. See29 U.S.C. § 1109.

The issue, rather, is one of an appropriate remedy. Relief under ERISA is equitable in nature. See Kamler v. H/N Telecomm. Servs., Inc., 305 F.3d 672, 681 (7th Cir.2002) (to obtain equitable relief under ERISA, a “plaintiff must allege that the breach of fiduciary duty caused some harm to him or her that can be remedied.”). Dr. Usiak acknowledges that as of February 7, 2011, all of the money that she was then owed had been deposited into her plan account. Because the account has been made whole, there is nothing further that Dr. Usiak may recover. See29 U.S.C. § 1109(a) (recovery under ERISA for breach of fiduciary duty is limited to “any losses to the plan resulting from each such breach, and ... any profits of such fiduciary which have been made through use of assets of the plan by the fiduciary.”). See also Watson v. Deaconess Waltham Hosp., 141 F.Supp.2d 145, 150 (D.Mass.2001), aff'd,298 F.3d 102 (1st Cir.2002) (“[C]ompensatory damages are only available to restore a plan to its uninjured condition; individuals cannot obtain compensatory or punitive damages for breach of fiduciary duty.”) (citations omitted).

Dr. Usiak's fallback contention is that she would not have withdrawn from the AHL plan had she not lost confidence in Dr. Meehl as a plan administrator and therefore she deserves to be awarded the 3% matching contributions that she would have received had she remained in the plan from January of 2011 to the present. The argument founders on the fact that AHL's matching contributions were contingent on Dr. Usiak's continued participation in the plan. Having voluntarily withdrawn from the plan and then having refused reinstatement as an AHL employee, she has no right to be compensated for an opportunity that she herself decided to forfeit.

In the alternative, Dr. Usiak suggests that plan-wide relief is available to her because “recovery for a violation of [29 U.S.C. § 1109] inures to the benefit of the plan as a...