Frommert v. Conkright, 00-CV-6311L.

• Citation: 206 F.Supp.2d 435
• Decision Date: 03 June 2002
• Docket Number: No. 01-CV-6447L.,No. 00-CV-6311L.,00-CV-6311L.,01-CV-6447L.
• Parties: Paul J. FROMMERT, et al., Plaintiffs, v. Sally L. CONKRIGHT, Patricia M. Nazemetz and Lawrence M. Becker, Xerox Corporation Plan Administrators, Xerox Corporation Retirement Income Guarantee Plan, and Xerox Corporation, a New York Corporation, Defendants. Gail J. Levy, et al., Plaintiffs, v. Sally L. Conkright, Patricia M. Nazemetz and Lawrence M. Becker, Xerox Corporation Plan Administrators, Xerox Corporation Retirement Income Guarantee Plan, and Xerox Corporation, a New York Corporation, Defendants.
• Court: U.S. District Court — Western District of New York

Page 435

206 F.Supp.2d 435

Paul J. FROMMERT, et al., Plaintiffs, v. Sally L. CONKRIGHT, Patricia M. Nazemetz and Lawrence M. Becker, Xerox Corporation Plan Administrators, Xerox Corporation Retirement Income Guarantee Plan, and Xerox Corporation, a New York Corporation, Defendants.

Gail J. Levy, et al., Plaintiffs, v. Sally L. Conkright, Patricia M. Nazemetz and Lawrence M. Becker, Xerox Corporation Plan Administrators, Xerox Corporation Retirement Income Guarantee Plan, and Xerox Corporation, a New York Corporation, Defendants.

No. 00-CV-6311L.

No. 01-CV-6447L.

United States District Court, W.D. New York.

June 3, 2002.

Robert H. Jaffe, Jaffe & Schlesinger, PA, and Robert H. Jaffe & Associates, PA, Springfield, NJ, for Plaintiffs.

Stephanie M. Caffera, Margaret A. Clemens, Nixon Peabody, LLP, Rochester, NY, for Defendants.

DECISION AND ORDER

LARIMER, Chief Judge.

Introduction

Plaintiffs commenced these actions¹ under the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq. Presently before the Court is defendants' motion, under FED.R.CIV.P. 12(b)(6), to dismiss portions of the complaint in each action.

Factual Background

Plaintiffs are employees or former employees of Xerox, each of whom worked for Xerox during two separate periods of time. During each plaintiff's original period of employment, he or she was a participant in Xerox' pension plan, known as the Retirement Income Guarantee Plan ("RIGP" or "the Plan"). Upon their initial termination of employment, each plaintiff received a lump sum distribution of his pension benefit. Each plaintiff was later re-hired by Xerox and again became a participant in the RIGP. Under the terms of the RIGP, the amount of plaintiffs' pension benefit is offset by the amount of their prior distribution plus any earnings which would have accrued had plaintiffs left their money in the plan.

Procedural Background

Plaintiffs, currently 96 in number, challenge the method used to calculate the offset for prior distributions. Plaintiffs' principally contend that Xerox improperly used the offset procedure which reduced the pension benefits of Xerox rehires. Because most of the plaintiffs are still employed with Xerox, they seek a determination now that their pension plan will not be so affected by the challenged offset procedure.

In their most recent iterations, plaintiffs' 791 paragraph, 173 page, second amended complaint in Frommert (Dkt. # 71) and plaintiffs' 201 paragraph, 64 page, amended complaint in Levy (Dkt. # 3) seek, inter alia, damages, injunctive relief, and a declaratory judgment. The complaints in Frommert and Levy each contain seven separate claims for relief. More particularly, plaintiffs seek a declaratory judgment (first count). They also seek relief under sections 1132(a)(1)(B) and (a)(3) (second count), sections 1054(g) and (h) (fifth count), section 1140 (sixth count), and sections 1054(d) and (e) (seventh count). In addition, they claim a breach of fiduciary obligation (third count), and violations of ERISA forfeiture provisions (fourth count).

Defendants have moved, under FED. R.CIV.P. 12(b)(6), to dismiss the first, third, fourth, fifth, sixth, and seventh counts of the complaints. They also move to dismiss the second count insofar as it makes any claims against any defendants except the RIGP, and to the extent that it purports to set forth a claim under § 1132(a)(3). For the reasons that follow, defendants' motion is granted in part and denied in part.

DISCUSSION

I. Motion to Dismiss—General Standards

In order to prevail on a motion to dismiss a complaint under Rule 12(b)(6), the moving party must show that "it appears beyond doubt that plaintiff can prove no set of facts in support of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957). When presented with a motion to dismiss for failure to state a claim, the court's function "is merely to assess the legal feasibility of the complaint, not to assay the weight of the evidence which might be offered in support thereof." Geisler v. Petrocelli, 616 F.2d 636, 639 (2d Cir.1980). "Thus `[t]he issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims.'" York v. Association of the Bar of the City of New York, 286 F.3d 122, 125 (2d Cir. 2002) (quoting Scheuer v. Rhodes, 416 U.S. 232, 236, 94 S.Ct. 1683, 40 L.Ed.2d 90 (1974)).

On a motion to dismiss for failure to state a claim, then, the "complaint must be sustained if relief could be granted `under any set of facts that could be proved consistent with the allegations.'" National Org. for Women, Inc. v. Scheidler, 510 U.S. 249, 256, 114 S.Ct. 798, 127 L.Ed.2d 99 (1994) (quoting Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d 59 (1984)); see also Patel v. Contemporary Classics of Beverly Hills, 259 F.3d 123, 126 (2d Cir.2001) (on motion to dismiss, district court must accept all allegations in the complaint as true and draw all inferences in non-moving party's favor, and "will not dismiss the case unless it is satisfied that the [plaintiff] cannot state any set of facts that would entitle him to relief").

II. Plaintiffs' Claims Under 29 U.S.C. §§ 1132(a)(1)(B) and 1132(a)(3)

Plaintiffs' second count asserts claims under two sections of ERISA: § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), which permits a civil action to be brought by a claimant or beneficiary "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan"; and § 502(a)(3), 29 U.S.C. § 1132(a)(3), which provides a right of action "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 do not seek dismissal of the § 502(a)(1)(B) claim against the Plan at this time, but they contend that it is not properly asserted against Xerox or the individually named plan administrators. With respect to that issue, the Second Circuit has stated that "[i]n a recovery of benefits claim, only the plan and the administrators and trustees of the plan in their capacity as such may be held liable." Crocco v. Xerox Corp., 137 F.3d 105, 107 (2d Cir.1998), quoting Leonelli v. Pennwalt Corp., 887 F.2d 1195, 1199 (2d Cir. 1989); see also Walsh v. Eastman Kodak Co., 53 F.Supp.2d 569, 574 (W.D.N.Y.1999) (dismissing plaintiff's ERISA claim against employer); Muller v. First Unum Life Ins. Co., 23 F.Supp.2d 231 (N.D.N.Y.1998) (denying plaintiff's motion to amend complaint to add ERISA claim against employer); Esden v. Bank of Boston, 5 F.Supp.2d 214, 217 (D.Vt.1998) (dismissing plaintiff's claim pursuant to ERISA § 502(a)(1)(B) against employer); Brannon v. Tarlov, 986 F.Supp. 146, 152 (E.D.N.Y.1997) ("[t]he plan participant's employer is not a proper party defendant [under § 502(a)(1)(B)]"), aff'd, 164 F.3d 617, 1998 WL 716580 (2d Cir.1998), cert. denied, 528 U.S. 837, 120 S.Ct. 99, 145 L.Ed.2d 84 (1999).

This claim must therefore be dismissed against Xerox. Under current Second Circuit precedent, the individually named plan administrators, in their capacity as such, are proper defendants, and will not be dismissed at this early juncture.

Plaintiffs' § 502(a)(3) claims must also be dismissed. The reason is clear: all of the relief requested by plaintiffs can be addressed via § 502(a)(1)(B), which plaintiffs have properly pleaded. Plaintiffs seek recovery of benefits as well as a determination of entitlement to benefits, and such matters can be provided under § 502(a)(1)(B). In fact, plaintiffs conceded at oral argument on this motion that all of the relief requested by plaintiffs could adequately be addressed under § 502(a)(1)(B), and, therefore, any claim for relief under § 502(a)(3) is unnecessary and duplicative.

Of course, this issue is not novel to this case. The United States Supreme Court and this Court have discussed the interplay between § 502(a)(3) and § 502(a)(1)(B). Relying on the United States Supreme Court decision in Varity Corp. v. Howe, 516 U.S. 489, 116 S.Ct. 1065, 134 L.Ed.2d 130 (1996), this Court in Edwards v. Akzo Nobel, Inc., 103 F.Supp.2d 214, 219-221 (W.D.N.Y.2000), dismissed a claim for relief under § 502(a)(3) since adequate relief was provided for plaintiff pursuant to § 502(a)(1)(B). Reliance on § 502(a)(3), a catchall provision, is unnecessary and inappropriate. This Court is not alone in so construing the Supreme Court's Varity decision. See Forsyth v. Humana, Inc., 114 F.3d 1467, 1475 (9th Cir.1997) ("[i]n these circumstances, Varity Corp. does not authorize equitable relief under the catchall provision of section 1132(a)(3). Equitable relief under section 1132(a)(3) is not `appropriate' because section 1132(a)(1) provides an adequate remedy in this case"); Wald v. Southwestern Bell Corp., 83 F.3d 1002, 1006 (8th Cir.1996); Kennard v. UNUM Life Ins. Co., 01-CV-217, 2002 WL 412067, *2 (D.Me. March 14, 2002) (granting motion to dismiss § 502(a)(3) claim for equitable relief because adequate relief could be afforded pursuant to § 502(a)(1)(B)); Campbell v. Computer Task Group, Inc., 00-CV-9543, 2001 WL 815575, *5 (S.D.N.Y. July 19, 2001) (granting motion to dismiss § 502(a)(3) claim, and noting "Supreme Court's admonition that where adequate relief is available under another ERISA section, equitable relief under section 502(a)(3) is inappropriate," and holding that "under Varity, there is no need for further equitable relief under section 502(a)(3)"); Dittman v. Dyno Nobel, Inc., 97-CV-1724, 1998 WL 865603, *8 (N.D.N.Y. November 24, 1998) (granting motion to dismiss § 502(a)(3) claim for equitable relief because...