Case Information
*2 CHERTOFF, Circuit Judges UNITED STATES COURT OF APPEALS (Opinion filed: June 16, 2004) FOR THE THIRD CIRCUIT
John M. Stull, Esquire (Argued) 1300 North Market Street Nos. 02-3620 & 02-4283 P.O. Box 1947
Wilmington, DE 19899 ORRIN T. SKRETVEDT, Attorney for Appellant
Appellant Raymond M. Ripple, Esquire (Argued) Donna L. Goodman, Esquire v. Suite D-7012 E.I. DuPont de Nemours & Company E.I. DUPONT DE NEMOURS, a Legal Department Delaware corporation; PENSION AND 1007 Market Street
RETIREMENT PLAN; HOSPITAL Wilmington, DE 19898 AND MEDICAL-SURGICAL PLAN;
DENTAL ASSISTANCE PLAN; Attorneys for Appellee NONCONTRIBUTORY GROUP LIFE
INSURANCE PLAN;
CONTRIBUTORY GROUP LIFE INSURANCE PLAN; TOTAL AND OPINION OF THE COURT
PERMANENT
DISABILITY INCOME PLAN; SAVINGS INVESTMENT PLAN; AM BRO, Circuit Judge TAX REFORM ACT STOCK OWNERSHIP PLAN;
Orrin T. Skretvedt seeks, inter alia SHORT TERM DISABILITY PLAN interest on the delayed payment of benefits
due him under two plans governed by the Employee Retirement Income Security Act On Appeal from the of 1974 (“ERISA”). Skretvedt received United States District Court benefits from one of those plans pursuant for the District of Delaware to a court judgment, while his employer D.C. Civil Action No. 98-cv-00061 voluntarily paid him benefits under the
(Honorable Mary P. Thynge) other plan after that judgment was entered.
The Magistrate Judge denied Skretvedt’s request for interest with respect to the Argued September 16, 2003 delayed payment of benefits under both
plans in light of the Supreme Court’s
*3
decision in
Great-West Life & Annuity
a l l o w a c la im a n t , u n d er s o m e
Insurance Co. v. Knudson
,
Magistrate Judge acknowledged that our
prior holding in Fotta v. Trustees of the
United Mine Workers of America , 165
F.3d 209 (3d Cir. 1998) (“ Fotta I ”), would *4 sue letter. On September 29, 1995, acting
I. Background
A.
Facts
on advice of counsel, Skretvedt signed a
“Settlement Agreement and Release of All
Skretvedt was employed by E.I. du
Claims” with DuPont. We previously
Pont de Nemours and Company
[2]
from June
noted that this agreement “released all of
28, 1974, until February 7, 1995. In early
[Skretvedt’s] employment-related claims
1994, Skretvedt was working as a Senior
against DuPont except for his application
Research Environmental Engineer when
for disability benefits, which DuPont
he began receiving treatments for work-
agreed to review in a ‘neutral’ manner.”
related anxiety from his family physician.
Skretvedt I
,
Skretvedt filed a claim with the duties of [his] job with the degree of E q u a l E m p l o y m e n t O p p o r t u n it y efficiency required by the Company, at the Commission alleging that DuPont violated time of [his] termination.” Skretvedt I , 268 the Americans with Disabilities Act by F.3d at 172. Skretvedt was also advised discriminating against him because of his that, in order to succeed in appealing the anxiety disorder. The EEOC found no Board’s determination, he would have to violation based upon the information that submit “additional objective evidence that Skretvedt submitted, and issued a right-to- will indicate a total impairment of
function,” such as “MRI, X-ray reports and
complete medical evaluations.”
Id.
As this appeal raises only issues of
Skretvedt contended, and DuPont denied,
that he and one of his doctors sent three
law, we state undisputed facts that provide
letters to the Board’s designated person for
background for our legal determinations.
appeals, requesting clarification with
A detailed statement of
the facts
respect to the types of “objective medical
underlying the parties’ dispute can be
evidence” he would need to perfect his
found in
Skretvedt v. E.I. du Pont de
application on appeal in light of the fact
Nemours & Co.
,
After receiving no response, he claims, he We collectively refer to the defendant submitted a formal appeal to the Board on ERISA plans and Skretvedt’s former May 16, 1997. Nonetheless, no further employer as “DuPont.”
response was received. Income Plan” (“T&P benefits”). Count VI alleged that Skretvedt was B. Procedural Background eligible to participate in a DuPont tax- Skretvedt filed an eight count deferred savings program known as SIP, complaint in the United States District and sought damages with respect to his Court for the District of Delaware on contributions in SIP having been paid out February 4, 1998. prematurely (in light of his having been, he Count I sought benefits from the alleged, wrongfully denied the right to “Incapability Retirement” pension program participate in the program after his (“incapability benefits”), and alleged that termination).
DuPont’s Benefits Board failed to inform Count VII claimed that Skretvedt Skretvedt under ERISA § 503, 29 U.S.C. had been wrongfully denied further § 1133, of the reasons for denying him participation in a DuPont stock ownership benefits. plan known as TRASOP, and sought
Count II claimed medical benefits reinstatement of TRASOP benefits and through a DuPont benefits program known certain damages resulting from the as MEDCAP and reimbursement for premature termination of his participation expenses incurred as a result of MEDCAP in the plan.
benefits not having been provided as of the Count VIII contended that date of his termination. Skretvedt was improperly denied benefits
Count III asserted a right to dental under DuPont’s short term disability benefits through a DuPont benefits (“STD”) plan.
p r o g r a m k n o w n a s D A P a n d Among other things, Skretvedt also reimbursement for expenses incurred as a sought prejudgment interest, postjudgment result of DAP benefits having been denied. interest, and reasonable attorney’s fees
Count IV alleged that Skretvedt was
with respect to each claim.
due a $3,000 payment under a DuPont
Skretvedt moved for summary
long-term life insurance plan known as the
judgment pursuant to Fed. R. Civ. P. 56,
“Noncontributory Plan” as a result of his
arguing,
inter alia
, that there was no
becoming disabled. Skretvedt also sought
genuine material dispute of fact as to the
declaratory relief that would deem him
Benefits Board having acted in an arbitrary
eligible for participation in DuPont’s
and capricious manner, or having abused
“Contributory Plan”
life
insurance
its discretion, and that he was entitled to
program, and sought
life
insurance
the award of benefits he requested.
benefits under its Noncontributory Plan.
DuPont also moved for summary
Count V requested benefits from
judgment, arguing,
inter alia
, that there
the “Total and Permanent Disability
was no evidence to support a finding that
*6
the Board acted in an arbitrary and
“vacate[d] the District Court’s order
capricious manner, thereby entitling them
granting summary judgment on the count
to summary judgment. On September 6,
challenging
the Board’s denial of
2000,
the Magistrate Judge granted
Skretvedt’s application for T& P benefits
summary judgment in favor of DuPont on
and remand[ed] it to the District Court,”
all claims, and denied Skretvedt’s motion
assuming “that the District Court will
for summary judgment. She concluded,
direct that DuPont’s [Benefits] Board
inter alia
, that “there is no genuine issue of
consider this claim in the first instance,
material fact upon which plaintiff could be
since even though Skretvedt is incapable
successful [in showing that the Board had
of performing the duties of his previous
acted in an arbitrary and capricious
position at DuPont, he may nevertheless be
manner]” and that “a genuine issue does
ineligible for T&P benefits.” at 185.
Id.
not exist as to the propriety of the Board’s
In light of our opinion, on remand
action. . . .”
Skretvedt v. E.I. du Pont de
the Magistrate Judge entered a judgment
Nemours & Co.
,
Skretvedt appealed the grant of benefits.” DuPont granted incapability summary judgment in favor of DuPont and benefits on March 6, 2002, in response to the denial of summary judgment in his that judgment. On the same day, without favor with respect to his claims for Skretvedt’s having to resort to further incapability and T&P benefits only. We judicial proceedings, DuPont granted T&P held that “[b]ecause the medical evidence benefits upon reevaluating Skretvedt’s that Skretvedt presented makes it clear that claim in light of our opinion. [4] he meets the eligibility standards for
incapability benefits, and the Board can
point to no conflicting medical evidence,
We also remanded Skretvedt’s request
. . . the Board’s decision was arbitrary and
that he be awarded attorney’s fees, noting
capricious because it was ‘without reason’
that such a request is one for the
and it was ‘unsupported by substantial
Magistrate Judge to consider using her
evidence.’”
Skretvedt I
,
remanded to the District Court with
directions to grant summary judgment in Skretvedt’s incapability and T&P favor of Skretvedt on the claim for benefits were subsequently adjusted by DuPont in his favor on April 15, 2002, and incapability benefits.” We further
again on April 16, 2002. *7 On April 1, 2002, Skretvedt Judge, referring to Skretvedt’s Other submitted to the Magistrate Judge an Claims Brief as a “Motion for Additional “Opening Brief in Support of Claims for Compensation,” addressed the merits of Short Term Disability Benefits, Interest on each of the requests contained in the brief. Delayed Payment of Benefits and Related The Court concluded that Skretvedt was Tax Reimbursement Claims (corrected)” not entitled as a matter of law to the (the “Other Claims Brief”). Although he interest, tax-rela ted compensation, had pursued only his claims in Counts I TRASOP adjustments, and adjustments to and V for incapability and T&P benefits in his incapability and T&P benefits that he his appeal to our Court in Skretvedt I , and sought. Furthermore, STD benefits, the although we remanded only with respect to Court held, were not available because: (1) those claims, Skretvedt sought to raise the relevant statute of limitations had again claims for which the Magistrate lapsed prior to Skretvedt’s request for Judge had previously granted summary those benefits; (2) the settlement judgment to DuPont, as discussed above. agreement Skretvedt signed with DuPont The brie f req ues ted, inter alia waived any claim to STD benefits; and (3) compensation with respect to DuPont’s employees with work-related injuries, such denial of medical benefits under Count II, as Skretvedt, were not eligible for STD compensation for his having been under the terms of the plan. prematurely removed from the TRASOP plan under Count VII, and an award of also sought interest on the delayed STD benefits under Count VIII. The brief c o m p e n s a t i o n consequences Skretvedt faced for having payment of all of his benefits and received back payments of benefits in the Magistrate Judge to take, and did not what action same tax year. The brief did not specify contain a formal motion, but instead in its “ C o n c l u s i o n ” it was requesting f o r a d v e r s e s e c t i o n s t a t e d : t a x the appeal then filed a notice of appeal of the August reconsideration on November 12, 2002. which was docketed at No. 02-3620. The Magistrate Judge denied the motion for docketed at No. 02-428 3. appeal on November 14, 2002, seeking to November 12, 2002, orders, which was reconsideration on September 4, 2002, and 21, 2002, order on September 20, 2002, Skretvedt filed an amended notice of Skretvedt filed a motion for the August 21, 2002, and W e “WHEREFORE, Skretvedt presents his view of STD, interest on delayed payments resolved in his favor.” Other Claims Brief and raises germane issues needing to be opposing Skretvedt’s claims. at 12. DuPont submitted a memorandum of the November 12, 2002, order in his Skretvedt incorrectly reported the date amended notice of appeal as November 13, 2002. As this order reaffirms the August 21, 2002, judgment, we refer hereafter (unless the context requires otherwise) to
On August 21, 2002, the Magistrate
that judgment only. *8 consolidated both timely appeals. contest the issue of appellate jurisdiction, we have the duty to raise the issue sua
II. Jurisdiction sponte .” Commonwealth. of Pa. v. The Magistrate Judge had subject Flaherty , 983 F.2d 1267, 1275 (3d Cir. matter jurisdiction over this matter 1993). We must, accordingly, determine pursuant to 29 U.S.C. § 1132(f) and 28 whether the orders were final under 28 U.S.C. § 1331. Both parties assert that we U.S.C. § 1291.
have final order jurisdiction under 28 U.S.C. § 1291 to review the Magistrate J u d g e ’ s o r d e r “Although the parties do not Brief. [7] requested in Skretvedt’s Other Claims reconsideration) disposing of the relief ( a n d o r d e r o n Skretvedt I jurisdiction, we first address our Court’s decision and remand order in Prior to that decision, the Magistrate Judge . granted summary judgment on all of Skretvedt’s claims in favor of DuPont in In order to examine our current September 2000. As noted above, we [6] While these appeals were pending, issued a limited remand with respect to the claims for incapability and T&P benefits, Skretvedt moved before the M agistrate and directed the Magistrate Judge to Judge for attorney’s fees and costs consider the attorney’s fees issue in her pursuant to ERISA § 502(g), 29 U.S.C. discretion. The Magistrate Judge entered § 1132(g). His motion was granted, but he a judgment, pursuant to our opinion and was awarded less than he requested. order, that completely disposed of the Skretvedt appealed that award, which was docketed at No. 03-2805 and has since incapability benefits claim. [8] DuPont been decided by another panel of this
Court.
is final under 28 U.S.C. § 1291. See, e.g. Where, as here, the parties have Abrams v. Lightolier Inc. , 50 F.3d 1204,
consented under 28 U.S.C. § 636(c)(1) to 1209 n.1 (3d Cir. 1995).
allowing a magistrate judge to “conduct
any or all proceedings in a jury or nonjury The judgment entered by the civil matter and order the entry of Magistrate Judge with respect to judgment in the case,” id. , 28 U.S.C. incapability benefits reads in its entirety: § 636(c)(3) provides for an “appeal “Pursuant to the Order of the Third Circuit directly to the appropriate United States Court of Appeals dated October 5, 2001, court of appeals from the judgment of the Judgment is entered on behalf of the magistrate judge in the same manner as an plaintiff on his claim for incapability appeal from any other judgment of a benefits.” Ordinarily, “[w]here the order district court.” ; see also Fed. R. Civ. P. appealed from finds liability and imposes 73(c). Accordingly, final order a monetary remedy, but does not reduce jurisdiction to review such an order arises that award to a specific figure, this court from 28 U.S.C. § 636(c)(3) to the extent it will usually find the order interlocutory.”
subsequently granted T&P benefits without Skretvedt’s having to seek a judgment. Neither party, however, sought Century Glove, Inc. v. First Am. Bank of formally to dispose of the claim for T&P New York , 860 F.2d 94, 98-99 (3d Cir. benefits ( e.g. , by dismissing Count V 1988); see Prod. and Maint. Employees’ voluntarily to the extent that it sought T&P Local 504 v. Roadmaster Corp. , 954 F.2d benefits or moving for summary judgment 1397, 1401 (7th Cir. 1992) (“A decision on mootness grounds because the benefits awarding but not quantifying damages had been paid voluntarily). normally is not final because it leaves a question that is not collateral to the merits In disposing of Skretvedt’s Other to be resolved in the district court.”). Claims Brief, the Magistrate Judge, as However, “even when a judgment fails to noted already, addressed on the merits fix the amount of damages, if the Skretvedt’s arguments with respect to determination of damages w ill be various other benefits sought in other mechanical and uncontroversial, so that counts of his complaint ( e.g. , Count VII the issues the defendant wants to appeal for TRASOP benefits, Count VIII for STD before that determination is made are very benefits). This had no effect on the unlikely to be mooted or altered by it—in finality of the August 21, 2002, order, but legal jargon, if only a ‘ministerial’ task with respect to the claim for T&P benefits remains for the district court to perform— that remained pending, the August 21, then immediate appeal is allowed.” at 2002, opinion and order did not explicitly 1401. dispose of that claim. While the order did
While the Magistrate Judge did not address Skretvedt’s additional request in quantify the accrued incapability benefits his complaint for interest on the delayed due to Skretvedt, DuPont applied a payment of those benefits, the claim for “mechanic al” formu la under t he T&P benefits itself was not directly incapability plan and awarded Skretvedt
back incapability benefits. Skretvedt’s
only issue with the application of that
Skretvedt in calculating his award was
formula was whether he should have been
“mechanical” and Skretvedt only disputes
credited for six additional months of
one aspect of that application (which was
company service because, in his view, he
fully disposed of by the Magistrate Judge),
was entitled to six months of STD
we conclude that the Magistrate Judge’s
benefits, and his length of service with
order (and order on reconsideration)
DuPont should have been extended by six
“end[ed] the litigation on the merits” with
months. The Magistrate Judge addressed
respect to that claim and “le[ft] nothing for
this argument, and Skretvedt now raises it
the court to do but execute the judgment.”
on appeal.
Gerardi v. Pelullo
,
Accordingly, because applying the Cir. 1994) (internal quotation marks and terms of the incapability benefits plan to citations omitted).
addressed. With respect to Skretvedt’s claim for the underlying award of T&P benefits, Ordinarily, in the absence of a Fed. he represented to the Magistrate Judge that R. Civ. P. 54(b) certification, “there is no DuPont had paid those benefits. See Other final order if claims remain unresolved and Claims Brief at 1 (“T&P Plan benefits their resolution is to occur in the district recently were granted by DuPont’s claims court.” Aluminum Co. of Am. v. Beazer agent, Aetna.”). Skretvedt did not argue East, Inc. , 124 F.3d 551, 557 (3d Cir. that DuPont in any way failed to award 1997). We recognized in Beazer East , T&P benefits or miscalculated the award however, that of T&P benefits, except as noted infra note to determine the effect of a 14. The Magistrate Judge also recognized district court’s decision–and in her August 21, 2002, opinion that T&P therefore to determ ine benefits had been awarded. See Magis. whether there is a final Judge Op. at 2 (“[Subsequent to Skretvedt ord er–it is so m e ti m es I ,] the DuPont Board of Benefits and necessary to look beyond Pensions granted plaintiff [T&P] benefits, the pleadings. A final order and [i]ncapability benefits approving a is not absent just because start date of February 8, 1995.”). the district court failed to Accordingly, we determine that the claim adjudicate all of the claims for T&P benefits was sufficiently resolved that were at one time in the August 21, 2002, opinion and order p l e a d e d . I n s t e a d , a n where the Magistrate Judge recognized a p p e l l a t e c o ur t m u s t that payment of T&P benefits was moot. determine whether, at the That order was therefore a final order [10] time it is examining its
jurisdiction, there remain judgment on a claim that has been unresolved issues to be abandoned’ by a party. Lusardi v. Xerox adjudicated in the district Corp. , 975 F.2d 964, 970 n. 9 (3d court.
Cir.1992) (quoting Jones v. Celotex Corp. 867 F.2d 1503, 1503-04 (5th Cir. 1989) at 560. [9] (per curiam)).”) (additional citation omitted).
The August 21, 2002, order also met *11 within the meaning of 28 U.S.C. § 1291. relevant portions of the Magistrate Judge’s
August 21, 2002, decision on appeal
address purely legal issues in the context
III. Standard of Review
of what is essentially a summary judgment
“[W]e must look to the course of
determination. “Inasmuch as we are
the proceedings in the district court and the
deciding this appeal by resolving questions
basis for its decision to determine the
of law, we are exercising
de novo
[
i.e.
,
standard of review.”
Blasband v. Rales
plenary] review.”
Bowers v. Nat’l
58’s separate document requirement where this case dealt with the Magistrate Judge’s it (1) is self-contained and separate from legal determinations. “The decision to the opinion, (2) sets forth the relief deny a Motion for Reconsideration is granted, and (3) omits the District Court’s within the discretion of the District Court, reasons for disposing of the parties’ but ‘if the court’s denial was based upon motions as it did).
the interpretation and application of a legal
The outstanding claim for statutory
precept, review is plenary.’”
Le v. Univ. of
attorney’s fees and costs under ERISA had
Pa.
,
(“When an outstanding claim
for
IV. Claims Litigated Other Than
attorneys’ fees is by a statutory prevailing
Those Remanded by
Skretvedt I
party, the unresolved issue of those fees
does not prevent judgment on the merits
As noted, on remand from
Skretvedt
from being final.”) (citing
Budinich v.
I
, Skretvedt
raised various claims
Becton Dickinson & Co.
, 486 U.S. 196,
regarding TRASOP benefits, medical
202 (1988));
Napier v. Thirty or More
premiums, STD benefits, and other claims
asserted in various counts in his complaint
Unidentified Fed. Agents
,
following entry of judgment involves
considerations distinct from the underlying
merits of the action itself.”).
claims in his prior appeal to our Court. challenge the Magistrate Judge’s grant of
summary judgment in favor of DuPont
We have held on numerous
with respect to these ancillary claims in his
occasions that “[a]n issue is waived unless
first appeal to our Court and thus clearly
a party raises it in its opening brief, and for
waived any arguments in favor of reversal
those purposes a passing reference to an
with respect to those claims, having
issue will not suffice to bring that issue
achieved success on the issues he did
before this court.”
Laborers’ Int’l Union
appeal in
Skretvedt I
, Skretvedt now seeks
v. Foster Wheeler Corp.
,
were not raised in a party’s prior appeal
and that were not explicitly or implicitly
Skretvedt’s opening brief from
remanded for further proceedings. “An
Skretvedt I
at one point averred generally
issue that is not addressed in an appellant’s
that he sought “to secure employee
brief is deemed waived on appeal.
benefits under related plans of the DuPont
Appellants’ alternative
theor[ies] of
company” after referencing incapability
recovery [were] not before this court in the
benefits. Appellant’s
Skretvedt I
Opening
earlier appeal;
a fortiori
, [they] could not
Brief at 3. Skretvedt additionally indicated
be remanded
to
the district court.
that he sought the “status of [a] retiree
Consequently, we cannot consider [them]
under the “[incapability benefits] pension
here [on appeal from the District Court’s
plan and related plans.”
Id.
Of course,
proceedings on remand].”
Wisniewski v.
“where important and complex issues of
Johns-Manville Corp.
,
was not raised on a prior
appeal,”
Munoz v. County of
Imperial
,
Moore, J. Lucas & T.
at 802 n.2 (quoting
Airlines, Inc. Laffey v. Northwest
(D.C. Cir. 1984)) (alterations omitted). , 740 F.2d 1071, 1089-90
Currier, ¶ 30.416[2], p. 517
Practice Moore’s Federal
(3d ed. 1984). When the
estoppel is operative in
proceedings in the same
case on remand, courts
Our decision in
Cowgill
rested
frequently speak in terms of
primarily on collateral estoppel, which we
the law of the mandate or
described as, at least in this context,
the law of the case rather
incorporating
the same underlying
than collateral estoppel but
principle as the so-called “mandate rule.”
the underlying principle is
Under the mandate rule, a species of the
the same.
Todd & Co., Inc.
law of the case doctrine, “a trial court must
v. S.E.C.
,
circumstances, address claims that ancillary claims Skretvedt waived in his consider arguments with respect to the interest prior appeal. “The judicial system’s administration dictates extraordinary circumstances, should not be permitted to relitigate issues Accordingly, we shall not now in finality and that, absent in efficient litigants Skretvedt previously abandoned. claims asserted in his complaint other than 1 4 Accordingly, we dismiss the portion of benefits, respectively, and address herein Counts I and V for incapability and T&P Skretvedt’s current appeal addressing only relief requested with respect to those counts. that they have already had a fair
opportunity to contest.”
Cowgill
, 832 F.2d
With respect to STD benefits, we will
at 802 (quoting
Todd & Co., Inc. v. S.E.C.
not now consider, for example, whether
this second appeal, given the absence of a
s h o w i n g o f a n y e x t r a o rd i n a r y Skretvedt has requested additionally
that damages (“tax compensation”) be
awarded with respect to the increased tax
part and reverses in part, all
liability he incurred because his accrued
issues necessarily disposed
ERISA benefits were paid in a single tax
of in the affirmance become
year. Had DuPont properly approved his
law of the case even though
benefits claim when it was submitted, he
the case is remanded for
suggests, his tax liability would have been
pro ce e d i n g s o n o t h er
lower because benefit payments would
issues).
have been made monthly and he would not
Cowgill
,
In light of Skretvedt’s clear waiver accrued benefits in a single tax year. of the ancillary claims, we need not rely on Skretvedt argues that the Magistrate Judge the mandate rule or law of the case in failed to apply Gelof v. Papineau , 829 F.2d reaching our determination. Skretvedt had 452, 455 n.2 (3d Cir. 1987), a case under a full and fair opportunity to litigate the the Age Discrimination in Employment ancillary claims in his prior appeal, and did Act. Putting aside that Gelof is not an not do so. Thus we see no basis under the ERISA case, it also did “not address . . . facts of this case for applying any of the whether such an award should be made in exceptions to the law of the case doctrine. all back pay cases” because of the See In re City of Phila. Litig. , 158 F.3d defendant’s “concession that the judgment 711, 718 (3d Cir. 1998) (discussing should properly include the negative tax exceptions to the law of the case doctrine). impact of a lump sum payment as an
V. Interest on the Delayed Payment of Benefits element of damages. . . .” Id. Skretvedt’s Other Claims Brief he would be entitled to tax compensation remedy. He does argue, however, that tax identified any term in any of his ERISA as a matter of “contract,” but he has not plans that would provide for such a § 502(a)(3)(B). As the Court of Appeals restitution, presumably under ERISA compensation is due him as a matter of for the First Circuit has suggested under analogous facts, “[t]his argument is highly Skretvedt additionally suggests that payment of incapability and T&P benefits under Counts I and V, respectively. inter alia sought, forms of benefits under our decision in request for interest with respect to both The Magistrate Judge analyzed Skretvedt’s , interest on the delayed , which held that a claimant whose ERISA benefits were delayed but Fotta I judgment having been entered) could, ultimately paid voluntarily (without a court under some circumstances, assert a cause dubious; the tax payments at issue would
seem to be completely distinct from any
ill-gotten profits which might properly be
made subject to a viable restitution claim.”
Armstrong v. Jefferson Smurfit Corp. , 30 § 502(a)(3)”); Armstrong , 30 F.3d at 13 F.3d 11, 13 n.5 (1st Cir. 1994).
(
Mertens
“compels the conclusion that
Skretvedt’s
claim
for
ta x
plaintiffs are precluded from recovering
compensation would seem to be no more
damages for the federal and state tax
than an ordinary claim for money damages
liabilities they incurred on . . . lump sum
as compensation for losses suffered.
payments”);
see also Harsch v. Eisenberg
,
Mertens v. Hewitt Associates
, 508 U.S.
claims for money damages are not
We do not read our mandate in
permissible under § 502(a)(3)(B) because
Skretvedt I
as having precluded Skretvedt
they are “the classic form of legal relief”
from seeking interest with respect to the
and are therefore not within the scope of
claims for incapability and T&P benefits
“appropriate equitable relief” allowed
that were on limited remand. The
under § 502(a)(3)(B). Accordingly, we see
Magistrate Judge clearly had authority to
no basis for such a claim to be brought
conduct further proceedings with respect
under § 502(a)(3)(B).
See Farr v. U.S.
to interest on those remanded claims, as
West Communications, Inc.
,
of action under ERISA § 502(a)(3)(B) to interest earned on withheld benefits.
for interest on that delayed payment as a
A.
Prejudgment Interest on a
form of “appropriate equitable relief.”
Judgment Procured Pursuant to
Fotta I
,
We conclude first that Great-West enforce his rights under the does not apply to Skretvedt’s claim for terms of the plan, or to clarify his rights to future prejudgment interest with respect to incapability benefits awarded pursuant to benefits under the terms of a court judgm ent unde r ERIS A the plan. . . .
§ 502(a)(1)(B). We then address
separately Skretvedt’s claims for interest Skretvedt’s request for interest with
with respect to T&P benefits, which his respect to ERISA benefits he was awarded employer voluntarily paid after several years of litigation, and conclude that p u r s u a n t t o a j u dg m e n t u n d e r § 502(a)(1)(B) is no more than an ordinary Great-West does not preclude a claim under ERISA § 502(a)(3)(B) for restitution request for prejudgment interest on a by way of a constructive trust with respect judgment obtained pursuant to a federal
statute. Our Court in
Anthuis v. Colt
Industries Operating Corp.
,
Id.
payments for other than standards in granting prejudgment delinquent contributions, we interest”).
have held generally that
Anthuis
relied in part on the
“[i]n the absence of an
Supreme Court’s determination in
Board
e x p l i c i t c o n g r e s s io n a l
of Commissioners of Jackson County,
directive, the awarding of
Kansas v. United States
,
Billings v. United States
232 U.S. 261, 284-288, 34
at 1009 (alterations in original);
see
S.Ct. 421, 425-427, 58
also Schake v. Colt Indus. Operating Corp.
L.Ed. 596 [(1914)]. For in
Severance Plan for Salaried, Nonunion
t h e a b s e n c e o f a n
Employees
,
light of general principles A n t h u i s , w e a p p l i e d B o a r d o f deemed relevant by the Commissioners in determining that a Court. See, e.g. , Royal successful ERISA plaintiff could obtain Indemnity Co. v. United prejudgment interest as part of his or her , States [313 U.S. 289, award of delayed ERISA benefits. 295-97, 61 S.Ct. 995, 997,
998,
Ambromovage v. United Mine Workers of
Id.
Aa.
,
Applying Board of Commissioners Rodgers and determining that “[t]he or Rodgers , we have in the past purposes of the provisions of the determined that prejudgment interest is Taft-Hartley Act under which this lawsuit available with respect to judgments proceeded is the protection of pension obtained pursuant to several statutes that are silent as to its exaction. [18] Moreover, in beneficiaries and union members. It would
not be inconsistent with these purposes to award aggrieved members of those , See, e.g. Gov’t of V. I. v. Davis , 43 income.”). protected classes interest on lost F.3d 41, 47 (3d Cir. 1994) (citing Rodgers
and holding that prejudgment interest “is
and
Anthuis Schake
are by no means
an aspect of the victim’s actual loss which
alone in concluding that a successful
must be accounted for in the calculation of
ERISA plaintiff may be entitled to
restitution
in order
to effect
full
prejudgment interest as part of his or her
compensation” under the Victim and
benefits award.
See, e.g.
,
Cottrill v.
Witness Protection Act);
Poleto v. Consol.
Sparrow, Johnson & Ursillo, Inc., et al. Rail Corp.
, 826 F.2d 1270, 1274-79 (3d
Although we wrote in the context of Anthuis the statutory provision of ERISA benefits having been awarded pursuant to under which a plaintiff could obtain § 502(a)(1)(B), we did not make explicit in prejudgment interest as part of her or his
benefits award. But we did not suggest the trial court.”) ( ); en banc Hansen v. (5th Cir. 1991) (“[T]o determine whether , 940 F.2d 971, 984 n.11 Cont’l Ins. Co. appropriate equitable plaintiff to pursue such a claim as “other that it would be necessary for a prevailing § 502(a)(3)(B). We now make explicit relief” under an award of prejudgment interest is
appropriate, the court must determine
that, in accordance with Board of granted would otherwise fall Commissioners and Rodgers , an ERISA short of making the claimant plaintiff who prevails under § 502(a)(1)(B) whole because he or she has in seeking an award of benefits may been denied the use of the request prejudgment interest under that money which was legally section as part of his or her benefits award. due. Awarding prejudgment interest is intended to serve Accordingly, the Supreme Court’s at least two purposes: to decision in Great-West , interpreting the c o m p e n sate prev ailin g extent of “appropriate equitable relief” parties for the true costs of available under ERISA § 502(a)(3)(B), money damages incurred, does not apply to the availability of and, where liability and the prejudgment interest on a benefits award amount of damages are obtained under § 502(a)(1)(B). We fairly certain, to promote therefore reverse the M agistrate Judge’s s e t tl e m e n t a n d d e t e r denial of prejudgment interest with respect attempts to benefit from the to the delayed payment of Skretvedt’s inherent delays of litigation. incapability benefits so that the Court may Thus prejudgment interest exercise its discretion in the first instance should ordinarily be granted in determining whether prejudgment unl e s s e xcep tional o r interest is appropriate. Under Anthuis , unusual circumstances exist [a]s a general rule , making the award of interest prejudgment interest is to be inequitable.
awarded when the amount
of the underlying liability is
reaso nably capable of
Anthuis
,
F.2d 745, 752 (8th Cir. 1986) (internal citations omitted)).
award for an ERISA plaintiff who is
We recognize that we have “not . . .
successful under § 502(a)(1)(B). To the
offer[ed] extensive guidance for deciding
extent that
Fotta II
discusses a successful
what rate of interest is appropriate in a
ERISA plaintiff needing
to use
given case.”
Holmes v. Pension Plan of
§ 502(a)(3)(B) to “sue for interest,” in the
Bethlehem Steel Corp.
,
v. Matson Navigation Co.
,
the rate of prejudgment interest is We believe the distinction is committed to the discretion of the district unpersuasive. The principles court.”). justifying p r e j u d g me nt B. Interest on the Delayed Payment interest also justify an award
of Benefits Under § 502(a)(3)(B)
of interest where benefits
able to receive his or her benefits due
question: can “a beneficiary who has been
considerable delay, but without resorting
under an ER ISA plan only after
assert] a cause of action under ERISA.”
Fotta I
,
U n j u s t
e n r i c h m e n t
“prejudgment interest” with respect to the
We refer to “interest” and not
plaintiff seeking to recover interest on the
, as a
Fotta I
cause of action discussed in delayed payment of benefits where there is
“interest.”
seek “prejudgment” interest, but merely
no underlying court judgment does not
a judgment deprives the
To hold that the absence of
principles also apply with
equal force in this setting.
money would create a
time value of his or her
injured beneficiary of the
financial incentive for plans
to delay payment and thus
*22
retain interest that rightfully
While not
ruling out
that
belongs to the beneficiary.
§ 502(a)(1)(B) might “provide[] a possible
statutory basis” for a claimant to bring a
Fotta I
,
Fotta I wisely noted that making the voluntarily by DuPont in the late stages of claimant whole and unjust enrichment are this litigation. concerns equally present with respect to both of these scenarios ( i.e. , where benefits have been awarded pursuant to a judgment and where benefits have been without resort to a judgment). withheld but are ultimately awarded similarly held that a cause of action may Other circuit courts have since be maintained for interest on the delayed payment of benefits as “appropriate equitable relief” under § 502(a)(3)(B). See
Dunnigan v. Metro. Life Ins. Co. , 277 F.3d 223, 229 (2d Cir. 2002) (“Where interest is Indeed, this case presents an even sought to make the plaintiff whole by more compelling example than Fotta I , as eliminating the effect of a defendant's Skretvedt did have to resort to litigation breach of a fiduciary duty, we see no and was only paid T&P benefits reason why such interest should not be
Hewitt Associates
, 508 U.S. 248 (1993),
that “the term ‘equitable relief’ in §
1.
Great-West
and Equitable
502(a)(3) must refer to ‘those categories of
Versus Legal Restitution
relief that were typically available in
In
Great-West
the Supreme Court
equity.’”
Great-West
, 534 U.S. at 210
reiterated its earlier holding in
Mertens v.
(quoting
Mertens
,
Court then clarified that restitution, a remedy Fotta I generally regarded as equitable and therefore within the scope of deemed ‘appropriate equitable relief’ relief available under § 502(a)(3)(B), in within the scope of § 502(a)(3)(B).”); see fact exists in two forms: legal restitution also Kerr v. Charles F. Vatterott & Co. and equitable restitution. Only the latter 184 F.3d 938, 946 (8th Cir. 1999) form of restitution, the Supreme Court (§ 502(a)(3) supports a claim for interest held, is available under § 502(a)(3)(B). Id. on the delayed payment of benefits to at 212-13 (“[N]ot all relief falling under prevent unjust enrichment where “the the rubric of restitution is available in wrongdoer . . . use[d] the withheld benefits equity. . . . [R]estitution is a legal remedy or retain[ed] interest earned on the funds when ordered in a case at law and an during the time of the dispute”). The equitable remedy . . . when ordered in an Court of Appeals for the Seventh Circuit equity case, and whether it is legal or has specifically suggested that such equitable depends on the basis for the restitutionary relief is available through a plaintiff’s claim and the nature of the constructive trust. See Clair v. Harris underlying remedies sought.”) (internal Trust and Savings Bank , 190 F.3d 495, quotation marks and alterations omitted). 498-99 (7th Cir. 1999) (“[P]laintiffs are asking . . . that the court impress a This distinction between legal constructive trust on the interest that the restitution and equitable restitution turns defendants earned on benefits withheld in on the following: violation of the terms of the plan. A In cases in which the constructive trust . . . is an equitable plaintiff “could not assert remedy commonly sought and granted in title or right to possession of cases of unjust enrichment. . . . If A particular property, but in wrongfully appropriates money or other which nevertheless he might property belonging to B, the court can be able to show just grounds order A to hold the property in trust for B. for recovering money to pay That is the nature of the relief sought by for some benefit the the plaintiffs in this case [and] Health Cost defendant had received from Controls [ v. Washington , 187 F.3d 703, him,” the plaintiff had a 710 (7th Cir. 1999)] holds that such relief right to restitution at law is squarely within the scope of section through an action derived 502(a)(3)(B).”).
from the common-law writ case of the equitable lien) to of assumpsit. 1 [Dan B. a plaintiff who was, in the Dobbs, Law of Remedies: eyes of equity, the true Damages–Equity–Restituti owner. But where “the on ] § 4.2(1), at 571 [(2d ed. property [sought to be 1993)]. . . . In such cases, recovered] or its proceeds the plaintiff’s claim was have been so dissipated so considered legal because he that no product remains, [the s o u g h t “ t o o b t ai n a plaintiff’s] claim is only that judgment imposing a merely of a general creditor,” and personal liability upon the the plaintiff “cannot enforce defendant to pay a sum of a constructive trust of or an money.” Restatement of equitable lien upon other Restitution § 160, Comment property of the [defendant].” a , pp. 641-642 (1936). Restatement of Restitution, supra , § 215, Comment a , at
* * * 867. Thus, for restitution to In contrast, a plaintiff could lie in equity, the action seek restitution in equity generally must seek not to ordinarily in the form of a impose personal liability on constructive trust or an the defendant, but to restore equitable lien, where money to the plaintiff particular or property identified as funds or property in the b e l o n g i n g i n g o o d defendant’s possession. conscience to the plaintiff
could clearly be traced to
particular funds or property
Great-West
,
order a defendant to transfer Res titution in equity was title (in the case of the “ordinarily in the form of a constructive constructive trust) or to give trust or an equitable lien, where money or a security interest (in the *25 property identified as belonging in good Skretvedt seeks legal relief.” Magis. conscience to the plaintiff could clearly be Judge Op. at 9. The Magistrate Judge traced to particular funds or property in the perceived in Great-West a per se defendant’s possession.” Great-West , 534 pronouncement that where a plaintiff seeks U.S. at 213 (citing 1 Dan B. Dobbs, Law of an award that ultimately involves money Remedies: Damages–Equity–Restitution § (regardless whether that award consists of 4.3(1), at 587-88 (2d ed. 1993) (“Dobbs”); a constructive trust over funds that “belong Restatement of Restitution § 160 cmt. a, at in good conscience to the plaintiff” and 641-42 (1936); George E. Palmer, Law of can “clearly be traced to particular funds in Restitution § 1.4, at 17 (1978) (“Palmer”); the defendant’s possession”), such an id. § 3.7, at 262). award is a claim for legal relief and is not
Without examining the specific available under § 502(a)(3)(B). [25] forms of equitable restitution addressed in Our reading, however, is that Great-West , the Magistrate Judge in this Great-West did not adopt such a rule. case concluded that “the [Supreme] Court Instead, the Supreme Court indicated that, clearly indicated [in Great-West ] that to determine whether a specific form of claims for monetary damages, for the most underlying relief requested is available part, will be claims for legal relief. Here, under § 502(a)(3)(B), we must consider Skretvedt seeks money to compensate for whether that relief was typically available the lost interest caused by DuPont’s at law or in equity and, in the case of delayed payment. Thus, the Great-West restitutionary relief, whether the relief decision compels this court to find that requested was in fact a form of equitable
restitution. additional form of equitable restitution, an The Court also noted that an general rule that an action sounding in accounting for profits, is outside the 2. R e e x a m i n i n g I n t e r e s t U n d e r Restitutionary Award of § 502(a)(3)(B) a Analyzing the propriety of an equitable restitution must not seek to impose personal liability on the defendant.
“If, for example, a plaintiff is entitled to a
interest award under § 502(a)(3)(B) again
determination,
Great-West
indicated that
in light of
Great-West
, we start with
courts should “consult[], as we have done,
whether a claim for interest on the late
standard current works such as Dobbs,
payment of funds would generally be one
Palmer, Corbin, and the Restatements,
at law or one in equity. It is clear that a
which make the answers clear.”
Great-
claim for interest alone (
i.e.
, where the
West
, 534 U.S. at 217. Accordingly, we
underlying obligation had already been
inquire whether Skretvedt may seek
paid) on a late payment (
e.g.
, an overdue
interest on the delayed payment of his
loan) was traditionally not permitted at
T & P be ne fits
thro u g h e q u i t ab le
law.
See Stuart v. Barnes
,
Given the Supreme Court’s determination in Great-West that only profits remedy. See Parke v. First equitable restitution is available under § Reliance Standard Life Ins. Co. , ___ F.3d ___, 2004 W L 1144787, at *3-*7 (8th Cir. 502(a)(3)(B), we now determine whether a claim for interest on wrongfully withheld 2004) (“an award of interest on wrongfully ERISA funds is equitable, as opposed to delayed benefits remains permissible under [§ 502](a)(3)(B) after [ Great-West through legal, restitution. In making this
an accounting for profits] as a remedy for *27 According to Dobbs, a constructive a breach of a fiduciary duty to a trust can be imposed “upon any beneficiary”); see also Dunnigan v. Metro. identifiable kind of property or entitlement Life Ins. Co. , 214 F.R.D. 125, 134-35 in the defendant’s hands if, in equity and (S.D.N.Y. 2003) (“ Great-West has no conscience, it belongs to the plaintiff.” bearing on [an action for interest on the Dobbs § 4.3(2), at 589-90. A constructive delayed payment of benefits under trust is “only used when the defendant has § 502(a)(3)] because the relief [plaintiff] a legally recognized right in a particular seeks–an accounting of [the fiduciary’s] asset [, which] may even be a fund of profits made on withheld disability money like a bank account.” Id. at 591. benefits–is a form of relief ‘typically The constructive trust has what Dobbs available in equity’. . . .”). calls the “important characteristic” of
With respect to the accounting for allowing a plaintiff to “obtain, not merely profits remedy, however, the Supreme what he lost, but gains received by the Court in Dairy Queen, Inc. v. Wood , 369 defendant from the property’s increase in U.S. 469 (1962), cautioned that value, from its transfer, from its use in a
[t]he necessary prerequisite business operation.” Id. at 592. to the right to maintain a Dobbs is consistent with the suit for an equitable Restatement of Restitution, which suggests accounting, like all other that a constructive trust arises “[w]here a equitable remedies, is . . . person holding title to property is subject the absence of an adequate r e m e d y a t l a w .
Consequently, in order to
maintain such a suit on a where the legal issues are cause of action cognizable too complicated for the jury at law, as this one is, the adequately to handle alone, plaintiff must be able to the burden of such a show that the ‘accounts showing is considerably between the parties’ are of increased and it will indeed such a ‘complicated nature’ be a rare case in which it that only a court of equity can be met.
can satisfactorily unravel at 478 (footnotes omitted). Dairy them. In view of the powers Queen appears to cast some doubt on the given to District Courts by purely equitable nature of the accounting Federal Rule of Civil for profits remedy. We proceed with the Procedure 53(b) to appoint constructive trust remedy because it is masters to assist the jury in clear that this remedy would have been those exceptional cases typically available in equity.
to an equitable duty to convey it to another plaintiff. . . .
on the ground that he would be unjustly at 643-44. Dobbs, Palmer, and the enriched if he were permitted to retain it. . Restatement all make clear that the . .” Restatement of Restitution § 160, at constructive trust remedy typically would 640-41; see also Palmer § 1.3, at 12 (“In allow Skretvedt, in equity, to force DuPont the cases as a whole, constructive trust is to disgorge the gain it received on his accepted as a technique to be used in withheld benefits under a restitutionary working out solutions to problems of theory. unjust enrichment. . . .”). Generally, a constructive trust is imposed “to restore to 3. Specific Funds Traceable the plaintiff property of which he has been to an ERISA Plan unjustly deprived and to take from the We must still determine, however, defendant property the retention of which whether the restitution Skretvedt seeks is by him would result in a corresponding with respect to “money or property unjust enrichment of the defendant. . . .” identified as belonging in good conscience Restatement of Restitution § 160, cmt. d, to the plaintiff [that can] clearly be traced at 643. Even where the to particular funds or property in the
plaintiff . . . has not suffered defendant’s possession.” Great-West , 534 a loss or . . . has not suffered U.S. at 204; see also Palmer § 3.7, at 262 (in “most of the restitution cases the a loss as great as the benefit received by the defendant[,] equitable relief sought by the plaintiff is with respect to specific property, usually to . . . the defendant is compelled to surrender the obtain either specific restitution or a lien benefit on the ground that he on the property”).
would be unjustly enriched DuPont, seizing on this aspect of if he were permitted to Great-West , argues that Skretvedt seeks to retain it, even though that make it and the defendant ERISA plans enrichment is not at the “personally liable” for “interest” on the expense or wholly at the delayed payment of his ERISA benefits in expense of the plaintiff. violation of Great-West . We disagree. Thus, if the defendant has Skretvedt’s cause of action under made a profit through the § 502(a)(3)(B) is against the relevant violation of a duty to the ERISA plans whereby he seeks restitution plaintiff to whom he is in a by way of a constructive trust over the fiduciary relation, he can be actual funds wrongfully earned by those compelled to surrender the profit to the plaintiff,
although the profit was not
made at the expense of the
*29
plans.
[27]
In our case, we need not even look
plaintiff must identify money or property
that is “clearly . . . trace[able] to particular
funds or property in the defendant’s
Harris Trust
the Supreme Court looked to ,
transaction unlawful.” at 251. Indeed, as several circuit courts have
noted, the Senate Finance Committee, in its report on ERISA , specifically *30 benefits were wrongfully withheld or
wrongfully delayed, that is, . . . withheld or delayed in violation of ERISA or an [29] ERISA plan.” 319 F.3d at 617. If u n l e s s e x c e p t i o n a l o r u n u s u a l “interest is presumptively appropriate . . . benefits were wrongfully withheld, at 618 (internal quotation marks and citations [30] omitted). interest inequitable [, such as] bad faith or dilatoriness by the claimant.” Id. circumstances exist making the award of 124, 131-34 (3d Cir. 2000). In , 213 F.3d Plan of Bethlehem Steel Corp. Holmes v. Pension our prior holding in in an award for the delayed payment of benefits under ERISA § 502(a)(3)(B) since its discretion in awarding interest on the Holmes we held that a District Court did not abuse the Treasury Bill yield rate as calculated in delayed payment of pension benefits under 28 U.S.C. § 1961 because, according to the District Court in that case, requiring the Our determination in Fotta II that a ERISA plan to disgorge its profits “would be essentially punitive in nature, and . . . district court must consider whether punitive measures were inappropriate benefits were wrongfully withheld or where the delayed payment of benefits was wrongfully delayed was based on the fact inadvertent rather than intentional.” at that § 502(a)(3)(B) “does not . . . authorize 132 (internal quotation marks and citations appropriate equitable relief at large , but omitted). only ‘appropriate equitable relief’ for the To the extent that Skretvedt seeks
purpose of ‘redress[ing any] violations or on remand a constructive trust to disgorge enforc[ing] any provisions of ERISA or an the gain of his ERISA plans, it would ERISA plan.” Fotta II , 319 F.3d at 616 seem, in light of Great-West , that the (quoting Fotta I , 165 F.3d at 213 (citing actual gain (if any) made on withheld Mertens , 508 U.S. at 253)) (internal benefits would be an appropriate subject of quotation marks omitted; emphasis in a constructive trust. See Dobbs § 4.3(2), at original). 592 (“The constructive trust has [an]
Of course, to the extent that especially important characteristic[:] . . . Skretvedt seeks prejudgment interest on under the rules for following property or his incapability benefits, which were money into its product, the plaintiff may awarded by court judgment pursuant to obtain . . . gains received by the defendant § 502(a)(1)(B), wrongful withholding or from the property’s increase in value. . . wrongful delay is not per se relevant, as .”). prejudgment interest in that context However, the Eighth Circuit in
derives from § 502(a)(1)(B) and the Parke , applying the accounting for profits District Court’s exercise of discretion in remedy, has noted that awarding interest. See supra Section V-A.
[a] defendant . . . Great-West may have changed the “gains” from the wrongful
nature of how “interest” is to be calculated
*31 C. Postjudgment Interest w i t h h o l d in g o f plaintiff’s benefits even if specific financial profit. In the plaintiff does not prove receives a benefit from particular, money. having control over the (“[U]ntil the plaintiff is § 3.6(2), at 344 n.22 paid, the defendant has the See the defendant [Dobbs] t h e Skretvedt seeks incapability benefits after the Magistrate award of interest and prejudgment interest Id. postjudgment interest, presumably on any district court.” “[i]nterest shall be allowed on any money judgment in a civil case recovered in a he receives on remand from this opinion Judge’s December 13, 2001, judgment. and to the extent DuPont delayed in paying 28 U.S.C. § 1961 provides that use of funds that ought to go With respect to Skretvedt’s to the discharge of his
obligation of the plaintiff.
That is a benefit. The the use of money . . . to which the plaintiff defendant may [choose] not was entitled” but “did not actually reap [to] use the funds or collect interest or profits.” Dobbs § 3.6(2), at i n t e r e s t o n t h e m . 344. This treatise indicates that the Nevertheless, he has a “clearest case for [such interest] liability benefit found in his power for unrealized gains occu rs with to do so.”). fiduciaries who are under a duty to invest Parke , ___ F.3d at ___, 2004 WL funds for the benefit of the plaintiff but 1144787, at *7 (third alteration in fail[] to do so.” Id. at 345.
original). Thus, while Parke suggested We need not, and cannot, address that it may be possible to disgorge a today whether interest or actual gain is to defendant’s actual gain if “specific be awarded to Skretvedt under § financial profit” can be shown, the Court 502(a)(3)(B), however, as the Magistrate concluded that “[i]n the particular context Judge could determine that Skretvedt is of withheld benefits under ERISA, . . . not entitled to such an award under Fotta [i]nterest is, in many respects, the only II and a record has not been developed as way to account for this gain and therefore to the actual gain, if any, made by the is an appropriate measure of the extent to relevant ERISA plans.
which [a defendant] was unjustly In reaching that
enriched.” , no judgment exists supra As noted conclusion, Parke relied on a section of with r e s p ec t to T & P bene fits . Dobbs suggesting that interest, as opposed Accordingly, there is no basis for an award to a defendant’s actual gain, is available as of postjudgment interest under § 1961 with restitution where the defendant “has had respect to these benefits.
underlying incapability benefits award,
determined that postjudgment interest
there was a delay between the Magistrate
under § 1961 “properly runs from the date
Judge’s December 13, 2001, judgment
of the entry of judgment.”
Kaiser
awarding incapability benefits and DuPont
Aluminum & Chem. Corp. v. Bonjorno
,
having paid those benefits on March 6,
F.2d 1144, 1177-78 (3d Cir. 1993), that
,
See, e.g. Cottrill v. Sparrow,
(1st Cir. 1996) (“ERISA provides for
,
1993) ( en banc ) (“In contrast to the district
court’s discretion in the awarding of
pre-judgment interest, federa l law
mandates the awarding of post-judgment
postjudgment
interest statute allows
interest. 28 U.S.C. § 1961 (1988). While
interest on “all money
judgments,”
ERISA does not specifically address
including
those
in ERISA cases.”)
post-judgment interest, it does provide that
(internal citations and quotation marks
the statute is not to be construed to ‘alter,
omitted);
Mansker v. TMG Life Ins. Co.
amend, modify, invalidate, impair, or
54 F.3d 1322, 1331 (8th Cir. 1995) (“28
supersede any law of the United States.’
U.S.C. § 1961 provides the proper measure
29 U.S.C. § 1144(d) (1988). Therefore,
for determining rates of both prejudgment
the federal post-judgment interest statute,
and postjudgment interest” in ERISA
28 U.S.C. § 1961 (1988), is applicable in
cases);
Carriers Container Council, Inc. v.
ERISA cases.”);
Caffey v. UNUM Life Ins.
Mobile S.S. Ass’n, Inc. et al.
, 948 F.2d
Co.
, 302 F.3d 576, 586 (6th Cir. 2002)
1219, 1226 (11th Cir. 1991) (upholding
(“The statute mandates the imposition of
application of § 1961 to an ERISA award);
post-judgment interest, thus removing the
I.A.M. Nat. Pension Fund, Plan A, A
award of such interest from the discretion
Benefits v. Slyman Indus., Inc.
, 901 F.2d
of the District Court. The federal
127, 130 (D.C. Cir. 1990) (same).
to pursue postjudgment interest with
respect to DuPont’s four month delay in
However, while postjudgment
paying incapability benefits.
interest can begin to accrue on a non-final
judgment under
Iron Ore
, the phrase “any
With respect
to postjudgment
money judgment” in § 1961(a) “requires
interest on the Magistrate Judge’s award of
that the judgment at issue award a fixed
any prejudgment interest for incapability
amount of fees to the prevailing party in
benefits, postjudgment interest should be
order to trigger the post-judgment interest
calculated based upon the underlying
period.”
Eaves v. County of Cape May
judgment and award of prejudgment
receive postjudgment interest on any award of prejudgment interest under [33] A circuit split has developed on this ERISA § 502(a)(1)(B) with respect to issue, however. The Ninth Circuit, incapability benefits, should the Magistrate looking to “practical considerations,” has Judge award prejudgment interest in determined that postjudgment interest exercising her discretion, as discussed under § 1961 begins to run only where a above in Section V-A.
final, appealable judgment has been
entered.
See Dishman v. UNUM Life Ins.
,
agreeing with Iron Ore , has determined
availability of post-judgment interest on an delayed payment of T&P benefits; and (3) award of interest for the delayed payment postjudgment interest on both of those o f T&P b en efits u n der ER I S A awards. We remand for the M agistrate § 502(a)(3)(B). We need not address this Judge to reconsider in the first instance issue today, as the Magistrate Judge might whether Skretvedt is entitled in light of determine that Skretvedt is not entitled to this opinion to prejudgment interest on the a constructive trust for interest under Fotta award of incapability benefits and/or II because there was not a wrongful interest on the delayed payment of T&P withholding of or delay in paying T&P benefits, without prejudice to Skretvedt’s benefits. ability to file a timely motion for postjudgment interest on any resulting
Conclusion award of prejudgment interest (with We reverse the Magistrate Judge’s respect to incapability benefits) or interest August 21, 2002, and November 12, 2002, (with respect to T&P benefits). The orders only with respect to their denial of: appeal is dismissed otherwise to the extent (1) prejudgment interest on the award of it seeks to address claims raised in the incapability benefits; (2) interest on the complaint other than Counts I and V for
i n c a p a b i l i t y a n d T & P b e n e f i t s , respectively.
Supreme Court held that the
pre decessor statute to
section 1961[] did not apply
to equitable decrees, relying
on the use of the word
“ j u d g m e n t ” , a s
distinguished from “decree”,
the equitable counterpart.
C h i e f J u s t i c e T a n e y
explained that, “[the statute]
is confined, in plain terms,
to judgments at law.” Id. at 125-26 (noting a “hesitancy” to
interpret § 19 61 as man dati ng
postjudgment interest on back-pay awards
under the Fair Labor Standards Act when
those awards are procured under a section
of that Act arguably providing for relief
that is equitable in nature, but nonetheless
allowing for postjudgment interest on
other grounds) (footnote omitted).
Notes
[9]
See also Hindes v. F.D.I.C.
, 137 F.3d
the procedural requirements of Fed. R.
148, 156 n.3 (3d Cir. 1998) (“We have
Civ. P. 58 for an order that begins the
case law indicating that ‘[a]n order that
running of the time for appeal.
See Local
effectively ends the litigation on the merits
Union No. 1992 of the Int’l Bhd. of Elec.
is an appealable final judgment even if the
Workers v. The Okonite Co.
,
[20] We recognize that the panel in
Fotta
whether such an award is precluded by the
federal statute that gives rise to the cause
II
, in a case where there had been no
of action, and if such an award is not
underlying
judgment representing an
precluded, whether it would further the
award of benefits under § 502(a)(1)(B),
congressional policies embodied in the act.
construed
Anthuis
as allowing for an
ERISA does not preclude an award of
award of prejudgment interest under
prejudgment interest. Furthermore, . . . we
§ 502(a)(3)(B).
have no doubt[] that an award of
Fotta I
. . . determined who
prejudgment interest under ERISA furthers
has a cause of action under
the purposes of that statute by encouraging
§ 502(a)(3)(B). Before
Fotta
plan providers to settle disputes quickly
I
, o n l y a n E R I S A
and fairly, thereby avoiding the expense
beneficiary who had brought
and difficulty of federal litigation.”)
a legal action to recover
(internal citation omitted);
Bricklayers’
w r o n g f u l l y w i t h h e l d
Pension Trust Fund v. Taiariol
, 671 F.2d
benefits could sue
for
988, 989 (6th Cir. 1982) (“The general rule
i n t e r e s t u n d e r
is that in the absence of a statutory
[§ 502(a)(3)(B)].
See, e.g.
,
provision the award of prejudgment
Anthuis
,
[25] Without deciding the issue, the Court
constructive trust on particular property
held by the defendant, he may also recover
of Appeals for the Eleventh Circuit has
profits produced by the defendant’s use of
also suggested that
Great-West
“raises the
that property, even if he cannot identify a
question whether § 502(a)(3) ever allows
particular res containing the profits sought
an award of interest for delayed benefits or
to be recovered.
See
1 Dobbs § 4.3(1), at
whether such a claim is an impermissible
588;
id.
, § 4.3(5), at 608.”
Great-West
attempt to dress an essentially legal claim
[27] As a record has not been developed contemplated that “appropriate equitable as to whether Skretvedt’s ERISA plans relief” under § 502(a)(3)(B) would have, in fact, profited with respect to the include, “[f]or example, . . . a constructive withholding of Skretvedt’s benefits during trust [to] be imposed on the plan assets. . . the relevant time period, or whether those .” S. Rep. No. 93-383, reprinted in 1974 plans have retained funds from that period U.S.C.C.A.N. 4890, 4989; see Harsch v. (as opposed to having, at least Eisenberg , 956 F.2d 651, 656 (7th Cir. hypothetically speaking, transferred their 1992) (quoting the above language); funds to a third party), we express no Novak v. Andersen Corp. , 962 F.2d 757, opinion as to the entit(ies) that would 760 (8th Cir. 1992) (same); Sokol v. properly be the subject of a judgment Bernstein , 803 F.2d 532, 538 (9th Cir. entered pursuant to § 502(a)(3)(B). 1986) (same).
[34] We expressed this concern in Brock that “the better rule is for plaintiffs to be entitled to post-judgment interest from the v. Richardson , 812 F.2d 121 (3d Cir. date of entry of the initial, partial judgment 1987): . . . , even though that judgment was not In Perkins v. Fourniquet , 55 yet appealable.” Skalka v. Fernald Envtl. U.S. (14 How.) 328, 330, 14 Restoration Mgmt. Corp. , 178 F.3d 414, L.Ed. 441 (1853), the 429 (6th Cir. 1999).