Varsic v. U.S. Dist. Court for Cent. Dist. of California

• Decision Date: 05 October 1979
• Docket Number: No. 78-2242,78-2242
• Citation: 607 F.2d 245
• Parties: , 1 Employee Benefits Ca 1844 John Ivan VARSIC, Petitioner, v. UNITED STATES DISTRICT COURT FOR the CENTRAL DISTRICT OF CALIFORNIA, Respondent, and Amalgamated Insurance Fund, a/k/a Amalgamated Retirement Fund, Board of Trustees of the Amalgamated Insurance Fund, and Victor Berger, Real Parties in Interest.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 245

607 F.2d 245

56 A.L.R.Fed. 745, 1 Employee Benefits Ca 1844

John Ivan VARSIC, Petitioner, v. UNITED STATES DISTRICT COURT FOR the CENTRAL DISTRICT OF CALIFORNIA, Respondent and Amalgamated Insurance Fund, a/k/a Amalgamated Retirement Fund, Board of Trustees of the Amalgamated Insurance Fund, and Victor Berger, Real Parties in Interest.

No. 78-2242.

United States Court of Appeals Ninth Circuit.

Oct. 5, 1979.

Neal S. Dudovitz (argued), National Senior Citizens Law Center, Los Angeles, Cal., for petitioner.

Thomas J. Fineman (argued), Rose, Klein & Marias, Los Angeles, Cal., for respondent.

Appeal from the United States District Court for the Central District of California.

Before WALLACE and HUG, Circuit Judges, and SOLOMON, ^* District Judge.

WALLACE, Circuit Judge:

Varsic has petitioned this court for a writ of mandamus commanding the United States District Court for the Central District of California to rescind its order transferring his action for pension benefits to the United States District Court for the Southern District of New York, and for other relief. We agree with Varsic that the transfer order is erroneous and that this case meets the strict prerequisites for extraordinary relief. We therefore grant his petition.

I

The procedural history of this case, insofar as it is pertinent here, began when Varsic filed his complaint In forma pauperis in the United States District Court for the Central District of California. Varsic sought declaratory, injunctive, and monetary relief on behalf of himself and others similarly situated pursuant to various provisions of the Taft-Hartley Act, 29 U.S.C. §§ 141 Et seq., and the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. §§ 1001 Et seq. Defendants, the Amalgamated Insurance Fund, its Board of Trustees, and its administrator (hereinafter collectively referred to as the Fund), moved for dismissal, or in the alternative, for transfer of Varsic's action to the United States District Court for the Southern District of New York. They argued, among other things, that venue did not lie in the Central District of California pursuant to the ERISA venue provision, 29 U.S.C. § 1132(e)(2). ¹ The district judge denied the Fund's motion to dismiss, but granted the motion to transfer the action pursuant to 28 U.S.C. § 1406(a). ² Varsic seeks relief from this order in his petition here.

II

We consider first whether the district court erroneously granted the motion to transfer. The district judge apparently concluded that the ERISA venue provision did not permit venue to be laid in the district where an employee performs his work and earns his pension credits. We conclude that an unincorporated pension fund may be "found," within the meaning of 29 U.S.C. § 1132(e)(2), in such a district.

The liberal intent of Congress, which is embodied in ERISA generally, and in section 1132(e)(2) specifically, is clear. "It is . . . the policy of (ERISA) to protect interstate commerce and the interests of participants in employee benefit plans and their beneficiaries, . . . by providing for . . . ready access to the Federal courts." 29 U.S.C. § 1001(b). The Committee on Education and Labor of the House of Representatives, reporting on a draft of the ERISA legislation, stated that

(ERISA's) enforcement provisions have been designed specifically to provide . . . participants and beneficiaries with broad remedies for redressing or preventing violations of the Act. The intent of the Committee is to provide the full range of legal and equitable remedies available in both state and federal courts and to remove jurisdictional and procedural obstacles which in the past appear to have hampered effective enforcement of fiduciary responsibilities under state law for recovery of benefits due to participants. For actions in federal courts, nationwide service of process is provided in order to remove a possible procedural obstacle to having all proper parties before the court.

H.R.Rep. No. 93-533, 93rd Cong., 1st Sess. 17 (1973), Reprinted in (1974) U.S.Code Cong. & Ad.News, pp. 4639, 4655.

We cannot agree with the Fund's contention that the congressional purpose of this section was to restrict venue. The Fund urges that Congress intended to prevent the drain on pension funds which could result from subjecting them to suits in any district in which covered work is performed. We conclude that, while Congress may have been concerned with such a possibility, it clearly struck the balance in favor of liberal venue.

Section 1132(e)(2) specifies that a plaintiff may bring an action where (1) a plan is administered, or (2) a breach took place, or (3) a defendant resides or (4) a defendant may be found. The Fund urges an interpretation of this section such that all four roads would lead exclusively to its home office. First, it argues that when a pension fund's administration is centralized in one district, it may be sued only in that district, regardless of the source of its contributions. Specifically, the Fund suggests that "administration" includes the maintenance and processing of documents, structuring of a plan, decisionmaking regarding a plan, and the implementation of those decisions. As to the second alternative, the Fund suggests that a breach takes place only where the fiduciaries who control the plan (the trustees and administrators) have acted or omitted to act with respect to a given plaintiff. Finally, as to the third and fourth alternative venue grounds, the Fund apparently contends, as it did before the district court in support of its motion to dismiss or transfer, that because the Fund is not administered in the Central District of California it does not reside and cannot be found there. To accept this interpretation, we would apparently need to conclude that Congress intended that each of the four specific alternatives available to ERISA plaintiffs require essentially the same factual basis, I. e., where the fund is administered, as defined by the Fund. We do not ascribe to Congress that intent.

We find it significant that the term "found," employed by Congress in section 1132(e)(2), has been construed liberally when used in other venue provisions. See 1 Moore's Federal Practice PP 0.144(8), at 1496, 0.144(15), at 1552 (2d ed. 1979). See also id. P 0.144(1), at 1471-72 & nn.18 & 19. For example, with respect to the federal antitrust venue provision, 15 U.S.C. § 15, the Fifth Circuit has reasoned: "It is well established that, in the case of an unincorporated association, the association will be treated analogously to a corporation, . . . and will be deemed "found" within a district if it continuously carries on any substantial part of its activities there." Braun v. Berenson, 432 F.2d 538, 544 (5th Cir. 1970) (citations omitted). The copyright venue provisions, 28 U.S.C. § 1400(a), about which it has been stated generally that, "(a) corporation is 'found' in any district in which personal jurisdiction might be obtained over it," Mode Art Jewelers Co. v. Expansion Jewelry Ltd., 409 F.Supp. 921, 923 (S.D.N.Y.1976); Accord, Sterling Television Presentations, Inc. v. Shintron Co., 454 F.Supp. 183, 190-91 (S.D.N.Y.1978), provide a second example of this liberal approach. Thus, Congress' choice of this term for inclusion in the ERISA venue provision further supports our conclusion that the provision is intended to expand, rather than restrict, the range of permissible venue locations.

In view of the legislative history of the ERISA venue provision, as well as Congress' very choice of the word, we conclude that Congress intended that "found," as used in section 1132(e)(2), has the same broad application as it does in cases involving the antitrust and copyright venue provisions. Therefore, if personal jurisdiction is properly asserted over the Fund, it is "found" there.

We consider next, therefore, whether the Fund's contacts with the Central District of California are sufficient to satisfy the "minimum contacts" test for personal jurisdiction, International Shoe Co. v. Washington, 326 U.S. 310, 316, 66 S.Ct. 154, 90 L.Ed. 95 (1945). The Fund apparently concedes that it both receives contributions from employers on behalf of employees working in the district and provides benefits to some beneficiaries who live in the district. Moreover, the Fund acknowledges that its activities have generated fiduciary responsibilities to Varsic and other workers on whose behalf it has accepted contributions. The Fund argues, however, that its contacts in and relationship with the Central District of California are insufficient to support personal jurisdiction, and thus it is not "found" there as that term is used in section 1132(e)(2). We disagree.

The Supreme Court recently summarized the requirements of International Shoe and its progeny:

(A) defendant (must) "have certain minimum contacts with (the forum State) such that the maintenance of the suit does not offend 'traditional notions of fair play and substantial justice.' " . . . While the interests of the forum State and of the plaintiff in proceeding with the cause in the plaintiff's forum of choice are, of course, to be considered, . . . an essential criterion in all cases is whether the "quality and nature" of the defendant's activity is such that it is "reasonable" and "fair" to require him to conduct his defense in that State.

Kulko v. Superior Court of California, 436 U.S. 84, 92, 98 S.Ct. 1690, 1697, 56 L.Ed.2d 132 (1978) (citations omitted). See Forsythe v. Overmyer, 576 F.2d 779, 782 (9th Cir.), Cert. denied, 439 U.S. 864, 99 S.Ct. 188, 58 L.Ed.2d 174 (1978); Data Disc, Inc. v. Systems Technology Assocs., Inc., 557 F.2d 1280, 1287 (9th Cir. 1977). As the Court observed in Kulko, each case must be decided upon its own facts. 436 U.S. at 92, 98 S.Ct. 1690.

We recently considered the circumstances in which personal jurisdiction will properly lie.

If the nonresident defendant's activities within a...