Headley v. Omaha Constr. Indus. Pension Plan

RICHARD HEADLEY, Plaintiff, v. OMAHA CONSTRUCTION INDUSTRY PENSION PLAN, et al., Defendants.

No. 4:21-CV-3161

United States District Court, D. Nebraska

November 3, 2021

MEMORANDUM & ORDER

John M. Gerrard United States District Judge

The plaintiff, Richard Headley, worked on and off as an ironworker from 1960 to 1998, and during this period, he was a member of the defendant Iron Workers Union Local #21 ("Local #21"). Filing 1 at 2. Headley claims that during this time, and pursuant to a multi-employer bargaining agreement, defendant Omaha Construction Industry Pension Plan (a plan now administered by defendant CompuSys of Utah) received pension plan contributions on his behalf. Filing 1 at 2. Having not received any pension benefits from the Plan Headley brought this action. Local #21 has moved to dismiss Headley's claims against it pursuant to Fed.R.Civ.P 12(b)(6), arguing that Headley failed to allege sufficient facts to establish that it is a proper defendant under the applicable ERISA statutes, 29 U.S.C. § 1001 et seq. Filing 24. The Court agrees and will grant this motion.

BACKGROUND

Headley is 81 years old and lives in Lincoln, Nebraska. Filing 1 at 1-2. He began his career as an apprentice ironworker in 1960 and worked consistently in the industry for twenty-five years. Filing 1 at 2. In 1985, Headley took a hiatus from ironwork, later returning to the industry in 1992 and remaining until 1998, when a workplace injury left him permanently "disabled from doing any such work." Filing 1 at 2. Headley claims that at all times from 1960 to 1998 he maintained his "Union book" and paid his "Union dues." Filing 1 at 2. Additionally, during the periods that he was actively working as an ironworker, he alleges that pension contributions were made on his behalf to the Plan. Filing 1 at 2.

Although his work as an ironworker was intermittent, Headley asserts that his pension plan benefits were "fully vested" and that he "did not incur a break in service sufficient to force him to forfeit any pension plan benefits." Filing 1 at 2. In May 2019, Headley contacted Local #21 to inquire about his pension benefits. Filing 1 at 2. According to Headley, Local #21 informed him that they "had no records of any pension contributions made on his behalf, that his records were lost or destroyed, and that he did not have any vested pension benefits." Filing 1 at 2.

Believing he is entitled to pension benefits, Headley sued Local #21 the Plan, and CompuSys under the Employee Retirement Income Security Act ("ERISA"). Filing 1 at 1-2. Specifically, Headley asserts that (1) the defendants failed to pay the benefits due to him in violation of 29 U.S.C. § 1132(a)(1)(B); (2) the defendants failed to furnish requested documents in a timely manner as required by 29 U.S.C. § 1132(c)(1) and 29 U.S.C. § 1024(b)(4); and (3) the actions of the Plan administrators and/or trustees, by failing to keep and produce proper records of his contributions and pay his benefits, breached their fiduciary duties under ERISA. See filing 1 at 4-5.

STANDARD OF REVIEW

A complaint must set forth a short and plain statement of the claim showing that the pleader is entitled to relief. Fed.R.Civ.P. 8(a)(2). This standard does not require detailed factual allegations, but it demands more than an unadorned accusation. Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). The complaint need not contain detailed factual allegations, but must provide more than labels and conclusions; and a formulaic recitation of the elements of a cause of action will not suffice. Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). And to survive a motion to dismiss under Rule 12(b)(6), a complaint must also contain sufficient factual matter, accepted as true, to state a claim for relief that is plausible on its face. Iqbal, 556 U.S. at 678. A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged. Id. Where the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged-but has not shown-that the pleader is entitled to relief. Id. at 679.

Determining whether a complaint states a plausible claim for relief will require the reviewing court to draw on its judicial experience and common sense. Id. The facts alleged must raise a reasonable expectation that discovery will reveal evidence to substantiate the necessary elements of the plaintiff's claim. See Twombly, 550 U.S. at 545. The court must assume the truth of the plaintiff's factual allegations, and a well-pleaded complaint may proceed, even if it strikes a savvy judge that actual proof of those facts is improbable, and that recovery is very remote and unlikely. Id. at 556.

DISCUSSION

PAYMENT OF BENEFITS UNDER § 1132(A)(1)(B)

Local #21 first argues that Headley failed to plead any facts showing it is the proper defendant under § 1132(a)(1)(B). Filing 25 at 3. Section 1132 allows a participant in a qualifying plan to bring an action to "recover benefits due to him under the terms of the plan." When a plaintiff asserts such a claim, the proper defendant is ordinarily "the employee benefit plan itself." Ross v. Rail Car Am. Grp. Disability Income Plan, 285 F.3d 735, 740 (8th Cir. 2002). However, the Eighth Circuit has held that a claim can also be brought against a plan administrator. Hall v. LHACO, Inc., 140 F.3d 1190, 1194-95 (8th Cir. 1998). Under ERISA, an administrator is defined as

(i) the person specifically so designated by the terms of the instrument under which the plan is operated; (ii) if an administrator is not so designated, the plan sponsor; or (iii) in the case of a plan for which an administrator is not designated and a plan sponsor cannot be identified, such other person as the Secretary may by regulation prescribe.

29 U.S.C. § 1002(16)(A).

As Headley's claim for benefits is equitable in nature-"an in personam order [requiring] the payment of benefits"-the critical step in determining whether the plan itself or the plan's administrator is the proper defendant is identifying which party has the "authority, under the relevant plan documents, to pay benefit claims from plan assets." Greenwald v. Liberty Life Assur. Co. of Boston, 932 F.Supp.2d 1018, 1048 (D. Neb. 2013). Stated more simply, the proper defendant among them is "the party required by the plan to pay benefits." Id. (citing Brown v. J.B. Hunt Transp. Servs., Inc., 586 F.3d 1079, 1088 (8th Cir. 2009)).

Based on Headley's own statements, the Plan and CompuSys are both the "pension plan" and the "sponsors and/or administrators" of the pension plan as "defined in 29 U.S.C. § 1002(16)(A)." Filing 1 at 1-2. Conversely, Headley's complaint simply provides that Local #21 is a "labor organization," without asserting its relation, if any, to the multi-employer Plan. Filing 1 at 12. And, in his brief, Headley conceded that "[i]t is correct that Local #21 was not the plan administrator." Filing 26 at 1. Therefore, since Headley concedes that Local #21 is not the benefit plan or a plan administrator, it is not the proper defendant under § 1132(a)(1)(B).

For the sake of completeness, the Court will briefly note that Headley's complaint also provides no facts indicating that Local #21 is in any way responsible for making benefit payments pursuant to the Plan. The only fact Headley provided in his complaint related to Local #21 and the Plan is that the union told him "he did not have any vested pension benefits." Filing 1 at 2. At most, this may indicate that Local #21 has some role in maintaining records of contributions made and benefits available to its members under the Plan. But, that alone does not support a plausible inference that Local 21 has final authority to make benefit payments pursuant to the Plan. And the most authoritative statement on the issue in Headley's brief to the Court is that he does "not yet know . . . what role the Union had in supervising the pension contributions, collection, distribution and allocation to the proper accounts." Filing 26 at 4. That is not enough to overcome a motion to dismiss. Therefore, the Court will dismiss Headley's § 1132(a)(1)(B) claim against Local #21.

PRODUCTION OF PLAN DOCUMENTS

Local #21 similarly argues that it is not the proper defendant under ERISA's document production provisions since Headley has failed to plead any facts indicating that it is a plan administrator. Filing 25 at 4. The Court agrees. The text of §§ 1024(b)(4) and 1132(c)(1)(B), which work in conjunction, make it clear that the Court may only impose penalties on plan administrators who fail to furnish appropriately requested information to a participant in a timely manner. And the Eighth Circuit has also made it clear that "the only entity that may be fined under § 1132(c)(1)(B) is the plan administrator." Ibson v. United Healthcare Servs., Inc., 877 F.3d 384, 390 (8th Cir. 2017). As stated above, Headley concedes that Local #21 is not an administrator of the pension plan at issue. Thus, Local #21 is not the proper defendant, and the Court will grant its motion to dismiss these claims.

BREACH OF FIDUCIARY DUTIES^[1]

Because Local #21 is not a plan administrator, whether Headley can assert a claim against the union depends on whether he has pled sufficient facts to allow the Court to plausibly infer that Local #21 is an ERISA fiduciary, and in turn, breached its fiduciary duties. Local #21 argues that Headley has not met this burden since his complaint does not allege any facts indicating that the Plan documents named Local #21 as a fiduciary or that Local #21 had any discretionary authority or control over the Plan's assets or administration which would...