*1 point developed and the on this record may wish to be heard.
Commonwealth
BOLLMAN HAT COMPANY ROOT; Anstine, T. E. Dale P.C. Company, sponsor
Bollman Hat Hat Health and Plan, Appellant. Benefits
Welfare
No. 96-1191. of Appeals,
United States
Third Circuit.
Argued 1997. Jan. April
Decided 1997. Rehearing May 1997.
Sur Petition *2 Pennsylvania Lawyers Trial Associa-
pellee, tion. SLOVITER, Judge, Chief
Before SCIRICA, GREENBERG Circuit Judges. THE
OPINION OF COURT SCIRICA, Judge. Circuit appeal plan’s sub- This involves ERISA rights, rogation specifically whether legal expenses to the must contribute recovery plan participant’s against a third party. We addressed issue Capria-Ryan (3d Cir.1996), district decided after the judgment. ap- court here In this rendered distinguish Ryan or in peal we are asked to holding in the alternative to reconsider our Ryan.
I. sponsors a self- Bollman Hat insured, regulated employee benefit plan. employee, After a Bollman Kevin accident, Root, injured motorcycle was in a $100,197.92 Plan him his medical Thereafter, expenses. Root the third sued personal injuries responsible for his party $215,000.00 obtained settlement. sought from § Root accordance with 10.8 of the provides: any payment under the the event of shall, any person, Plan to the Plan covered payment, to the extent of such be subro- law, gated, prohibited by otherwise unless recovery rights to all the of the covered Hunsicker, (Argued), Freedley Jr. Su- J. any person arising out of claim or cause Drinker, Roche, Reath, & san M. Biddle alleged action which accrue because Philadelphia, Pennsylvania, Appellant. negligent Any conduct of a third hereby re- person agrees such covered (Argued), Lang Thomas Law Offices of P. any payments so imburse the Plan for P.C., Anstine, York, Pennsylvania, Dale E. any recov- made hereunder out of monies Parsil, Wayne of Dale E. C. Law Offices party from the result of ered such Lancaster, Anstine, P.C., Pennsylvania, for otherwise____ settlement, judgment, An- Appellees T. Root and Dale E. stine, P.C. added). Boll- (emphasis complied Root with Melillo, Rovner, request part, Angino Har- man’s for reimbursement but
Joseph M. $30,507.13 risburg, Ap- Pennsylvania, for Amicus Curiae withheld
H5
fiduciary
fees and costs incurred
obtain-
the extent” it acts in a
capacity. 29
U.S.C,
1002(21)(A) (definition
§
ing
party
the third
settlement.
of “fiducia
ry”).
See also Malia v. General Elec.
the terms of the Plan
Bollman contends
Cir.),
require full reimbursement and do not allow
(1994).
money
to withhold
fees.
*3
expressly
also maintains Root
Bollman
Bollman has limited the “extent” to
signed
agreed
full reimbursement when he
fiduciary by
a
delegating
which
is
some of
Agreement
a Reimbursement
before receiv-
fiduciary
its
duties. At least one circuit has
$100,197.92
ing the
from the Plan. The Reim-
brought
a
by
plan
held
suit
sponsor
a
as a
Agreement provides:
bursement
fiduciary does not arise under ERISA unless
the
is
fiduciary
action
related to
I,
T.'Root,
the
duties
understand and acknowl-
by
plan sponsor.
retained
Coyne
See
my
edge
plan
that
medical
has a reim-
Selman,
Delany
1457,
v.Co.
98 F.3d
1465
provision
provides
bursement
that
(4th Cir.1996).
Dep’t,
Northeast
764 F.2d
paid under
are to
medical benefits
Cf.
(“[Ojne’s
at 154
fiduciary
status as
under
up to the
of such
be reimbursed
amount
upon
dependant
ERISA is
relationship
one’s
paid
any payments,
benefits
from
awards
particular
to a
plan.”)
It is unclear whether
may
by any
or settlements which
be
fiduciary
Bollman retained
duties which are
any
way relevant to this lawsuit. But we
added).
(emphasis
do not need to resolve this issue
Even
here.
sponsor
brought
As
Bollman
jurisdiction
if our
does not arise under the
$30,-
against
suit
district court
itself,
jurisdic
statute
we nonetheless have
Following stipulations of
507.13.1
fact and
arising
tion
under the federal common law
cross-motions
developed pursuant
to ERISA. See Airco
granted summary judgment
district court
Gases,
Indus.
Inc.
Group,
Div.
the BOC
Finding
personal injury litiga
Root.
Inc.
Teamsters Health and
Pen
Welfare
Bolhnan,
substantially
tion
benefited
the dis
sion
Philadelphia
Vicinity,
Fund
850
unjustly
trict court held Bollman would be
(3d Cir.1988) (ERISA
1033-34
if
enriched
Root bore
full burden of
the.
case
arise under federal common law
litigation
appeals, citing
costs. Bollman
our
directly
where it does not arise
under the
intervening
Ryan by Capria-
decision
statute).
(3d
Express
Fed.
H7 Amicus, plan, distinguish Pennsyl Bollman called for should be overruled. Association, Lawyers no vania Trial urges “100%” reimbursement. We see distinc- also Ryan plan Ryan. holding us to point, we find the reconsider our tion. On Of course, plan materially panel to be identi- of our court and the cannot overrule a prior published plan unambiguous. Only cal and the Bollman to be decision.3 the court en do this. See Third Circuit I.O.P. banc ambiguous contends the Plan is also 9.1. duty pay Bon oilman’s provides, Nonetheless, “The shall amicus contends fees because will inequitable fees and costs associated with the en- lead to plan results par- where a rights.” appli- ticipant’s recovery forcement the Plan But the party is less than provision expressly subrogation cation of this limited to plan’s plus attorney’s claim rights,” Plan “enforcement of the i.e. actions party fully fees. But Root’s third settlement rights. its which the Plan enforces own It his subroga- financed fees and the require Plan does not to fund actions to tion hypothetical claim. We will not address independent rights enforce the of a ben- scenarios.
eficiary against a third Ryan Amicus also contends hinder settlement claims participants
C. *5 against parties. prospect This is trou- But Ryan only blesome. holds that we must Root maintains the Reimburse uphold unambiguous plan terms that do not signed Agreement ambiguous ment he statutory conflict policies. with ERISA’s De- specifically because it does not at address circumstances, pending parties on the ato torney’s fees. But the Reimbursement subrogation agreement may still be able to Agreement “up requires reimbursement negotiate compromises attorneys’ on fees. paid.” the amount of such benefits A agreement specifically need not address attorney’s unambiguously fees order to V.
require full reimbursement.2 Finally, apparently raises issue in Ryan. Citing not raised the common law
IV. subrogation, on Root maintains that a subro- major argument gee may The subrogor. thrust more not recover than the Ryan incorrectly Although argument explicit, ap- was decided and his 907, Agree- (W.D.Ark.1994) argues (allowing F.Supp. 2. Root also the Reimbursement 858 912 ment is an unconscionable adhesion plan participants contract. attorney’s to withhold fees but fact, parties' stipulations But the which were recognizing right that “if the to reimbursement sole basis factual district court’s deci- defined, contractually parties could ex sion on do not contain facts pressly agree that reimbursement would be support argument. Generally money first out of settlement with no monies we do not consider facts raised for the first time costs.”); attorneys deduction fees and appeal. City Philadelphia, v. See Harris 35 Thompson Express Corp., F.Supp. 809 840, F.3d 845 950, (M.D.Ga.1992) (holding plan partici 958 pant may portion not withhold fees support holding 3. note the has in the reimbursement). plan required But where full Foods, Inc., Cutting v. case law. See Jerome 993 Waller, & v. see Provident Accident Ins. Co. 1293, (7th Cir.) (declining adopt 1298-99 Life 985, (4th Cir.) (requiring reim preventing law federal common rule full reim theory unjust bursement under enrichment language where the clear of an bursement reimbursement), Congress’s plan requires because ERISA indicates desire to ERISA denied, cert. 916, 308, plans 510 U.S. 114 S.Ct equitably ensure that are administered (1993); Becker, F.Supp. beneficiaries, 255 724, v. Blackburn party, "that no one not even (N.D.Ill.1996) (employee with not unjustly profit."), should 982, hold because no fees “there is reason 512, unambiguous plan provision to fiddle with an Nickla, 981, Dugan F.Supp. v. 984-85 into.”); freely parties which the entered Trident (N.D.Ill.1991) (reducing reimbursement to reflect Polin, Reg'l Sys. F.Supp. Health fees, attorney's payment despite plan language (D.S.C.1996) ("[Fjederal courts do not rewrite reimbursement). requiring full ”); unambiguous plan.... terms of an ERISA Williams, Accident Provident Ins. Co. Life SLOVITER, Judge, Chief pro reduction of Present: rata pears Root advocates MANSMANN, BECKER, STAPLETON, lien, subrogation i.e. the Plan’s the Plan’s GREENBERG, SCIRICA, COWEN, limited, recov- as Root’s recovery should be NYGAARD, ALITO, ROTH, LEWIS limited, by of the pro rata ery was McKEE, Judges. Circuit Cohen, See, e.g., Simmons v. attorney’s fees. 551 A.2d 122 Pa.Cmwlth. PETITION FOR REHEARING SUR (1988) that, recipients where welfare (holding May sub- awards which were sued to recover SSI 1997. public
rogated department to the state rehearing by appel- filed petition for welfare, subrogee had department the state having lees in the above-entitled case been legal duty to contribute to their common law judges participated in submitted to the who expenses). to all the of this Court and other decision regu- circuit in judges available circuit of sub ERISA is silent on the issue service, judge lar and no who con- active at rogation. Ryan, 78 F.3d 127. We having for re- the decision asked curred only principle if “neces adopt a common majority hearing, judges of the circuit interstitially or effec sary fill in otherwise having regular of the circuit service statutory in the pattern enacted tuate the petition rehearing, for rehear- voted v. I.A.M. large by Congress.” Plucinski banc, ing panel (3d Fund, Nat’l Pension grant Judge Becker would rehear- denied. Cir.1989) (quoting v. American Van Orman ing. Cir.1982)). (3d 301, 312 Ins. Otherwise, may not create substantive we Air rights. Hamilton v. Jamai See Cir.1991) (Courts ca, Ltd., 945 F.2d authority to draft the substantive
have “no *6 plans.”) (quoting Blau v. in [ERISA] content America, Appellee, UNITED STATES (9th F.2d Corp., 748 Del Monte Cir.1984), cert. U.S. Barry DAVIS, “Mark a/k/a (1985)), de 88 L.Ed.2d S.Ct. Johnson”, Appellant. nied, S.Ct. v. Ameri Van Orman No. 96-1721. Cir.1982). can Ins. Appeals, United States Court Third Circuit. Root has not established that subrogation claims con 23, 1997. April Decided policies adoption flicts with ERISA’s pro to effec of a rata reduction fact, policies policies.
tuate these generally
underlying ERISA counsel reliance plan language. Or unambiguous Van (“The
man, Supreme F.2d at plan provi emphasized primacy
has
sions____”). Although circumstances necessitating pro rata reduction
arise
reimbursement, argument we find unconvincing.
this case Conclusion
VI. stated, we
For will reverse the the reasons summary in favor of Root
grant judgment court to enter
and remand to the district
judgment Ryan by favor Bollman. See
Capriar-Ryan Express Corp., 78