16-977-cv, 16-3549-cv In re: DeRogatis

16-977-cv, 16-3549-cv In re: DeRogatis

United States Court of Appeals FOR THE SECOND CIRCUIT ______________

August Term, 2017

(Argued: November 1, 2017 Decided: September 14, 2018)

Docket Nos. 16‐977‐cv, 16‐3549‐cv ______________

IN RE: EMILY DEROGATIS* ______________ Docket No. 16‐977‐cv EMILY DEROGATIS,

Plaintiff–Counter‐Defendant– Appellant,

—v.—

BOARD OF TRUSTEES OF THE WELFARE FUND OF THE INTERNATIONAL UNION OF OPERATING ENGINEERS LOCAL 15, 15A, 15C & 15D, AFLCIO; TRUSTEE JAMES T. CALLAHAN; TRUSTEE THOMAS A. CALLAHAN; TRUSTEE FRANCIS DIMENNA; TRUSTEE JOHN BRUNETTI,

Defendants–Counter‐Claimants– Appellees. ______________ Docket No. 16‐3549‐cv EMILY DEROGATIS,

Plaintiff–Consolidated‐Counter‐ Defendant–Appellant,

* The Clerk of Court is directed to amend the captions as set forth above.

—v.—

BOARD OF TRUSTEES OF THE CENTRAL PENSION FUND OF THE INTERNATIONAL UNION OF OPERATING ENGINEERS AND PARTICIPATING EMPLOYERS, PLAN ADMINISTRATOR; MICHAEL R. MURPHY, TRUSTEE; TERRENCE E. MCGOWAN, TRUSTEE; BRIAN E. HICKEY, TRUSTEE; JOHN DUFFY, TRUSTEE; ROBERT P. MCCORMICK; NOEL C. BORCK, TRUSTEE; PAUL O. GEHL, TRUSTEE; J. PATRICK TIELBORG, TRUSTEE; PAUL C. BENSI, TRUSTEE,

Defendants–Appellees,

JAMES T. CALLAHAN, TRUSTEE,

Defendant–Consolidated Defendant– Consolidated‐Counter‐Claimant– Appellee,

TRUSTEE FRANCIS DIMENNA; JOHN BRUNETTI; TRUSTEE THOMAS A. CALLAHAN; BOARD OF TRUSTEES OF THE WELFARE FUND OF THE INTERNATIONAL UNION OF OPERATING ENGINEERS LOCAL 15, 15A,15C &15D, AFL‐CIO,

Consolidated‐Defendants– Consolidated‐Counter‐Claimants. ______________

Before:

LYNCH, CARNEY, Circuit Judges, and VITALIANO, District Judge.† ______________

In these tandem cases, plaintiff‐appellant Emily DeRogatis appeals the judgment of the District Court (McMahon, C.J.) awarding summary judgment to defendants‐ appellees, the trustees of two union‐affiliated employee benefit plans, on her claims for relief asserted under the Employee Retirement Income Security Act (“ERISA”), 29

Judge Eric N. Vitaliano, of the United States District Court for the Eastern District of New †

York, sitting by designation.

et seq. The benefit plans at issue are the Pension Plan, which governed benefits payable to Emily as a surviving spouse after the death of her husband, Frank, and the Welfare Plan, which governed the DeRogatises’ entitlement to health benefits during and after Frank’s lifetime. The conflict arises primarily because of certain oral miscommunications by Plan personnel to the DeRogatises before Frank’s death in 2011. As to No. 16‐3549‐cv: On de novo review, we conclude that the Pension Fund trustees correctly denied DeRogatis’s request for an augmented survivor benefit following her husband’s death. We therefore affirm the District Court’s decision denying DeRogatis’s claim under ERISA § 502(a)(1)(B) against the Pension Fund for benefits due. As to DeRogatis’s claim under ERISA § 502(a)(3) for breach of fiduciary duty, the District Court reasoned that a plan administrator cannot be held liable for unintentional misrepresentations made about the plan’s operation by its non‐fiduciary, “ministerial” agent and on this basis denied the claim. We reject that ruling. Nonetheless, we affirm the judgment denying DeRogatis relief under this section because the Pension Plan’s summary plan description (“SPD”) adequately described the eligibility requirements for the benefits in question and thereby satisfied the trustees’ fiduciary duty to provide complete and accurate information to plan participants and beneficiaries. In No. 16‐3549‐cv, the summary judgment entered for the Pension Fund defendants is therefore AFFIRMED. As to No. 16‐977‐cv: DeRogatis asserts an ERISA § 502(a)(3) claim for breach of fiduciary duty against the trustees of the Welfare Fund. The District Court granted summary judgment for defendants on this claim on the same “ministerial employee” ground as described above. We again reject that analysis. We disagree, too, with the District Court’s conclusion that the Welfare Plan SPD explained clearly its participants’ options to receive post‐retirement health benefits. Given the evidence that Welfare Fund agents misstated material aspects of those same benefits when communicating with the DeRogatises, we identify an open question of material fact concerning whether the Welfare Fund trustees breached their fiduciary duty to provide plan participants with complete and accurate information about their benefits. We therefore vacate the judgment entered in favor of the Welfare Fund defendants. On remand, the Welfare Fund defendants may yet be entitled to summary judgment if they demonstrate that DeRogatis is not entitled to any equitable relief, thereby negating the final element of DeRogatis’s § 502(a)(3) claim. Accordingly, in No. 16‐977‐cv, the judgment for the Welfare Fund defendants is VACATED and the cause is REMANDED for further proceedings consistent with this opinion. ______________

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ROBERT L. LIEBROSS, Law Office of Robert L. Liebross, New York, NY (Edgar Pauk, Law Office of Edgar Pauk, Brooklyn, NY, on the brief), for Emily DeRogatis.

JAMES M. STEINBERG (Joseph H. Green, on the brief), Brady McGuire & Steinberg P.C., Tarrytown, NY for Defendants–Counter‐Claimants–Appellees in Docket No. 16‐977.

LISA M. GOMEZ (David R. Hock, Michael S. Adler, on the brief), Cohen, Weiss and Simon LLP, New York, NY, for Defendants‐Appellees and James T. Callahan, Trustee, in Docket No. 16‐3549. ______________ SUSAN L. CARNEY, Circuit Judge:

Plaintiff Emily DeRogatis’s husband, Frank DeRogatis, a long‐time operator of

heavy machinery on construction sites and a member of the International Union of

Operating Engineers “Local 15” in New York City, succumbed to lung cancer in

September 2011 at the age of 61. These tandem cases, in which his widow Emily asserts

claims for relief under the Employee Retirement Income Security Act (ERISA),

et seq., against multiemployer benefit plans, arise from events that occurred in

the months preceding Frank’s untimely death, when the couple was endeavoring to

secure Emily’s financial future.

Frank was a participant in two multiemployer benefit plans affiliated with

Local 15: a Pension Plan, which provided pension and survivor benefits, and a Welfare

Plan, which provided health benefits. When he died, Emily became entitled to a

monthly survivor benefit through the Pension Plan.1 The monthly payments that she

1 When describing events occurring while Frank was still alive, we refer to Emily and Frank DeRogatis by their first names. With regard to later events, we use either “DeRogatis” or “Emily” to refer to Emily as a claimant and litigant.

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received were several hundred dollars lower than the amount she had expected,

however. She sought to obtain the difference in suits against the administrators of each

Plan filed in the United States District Court for the Southern District of New York. Both

suits hinge on the effect to be afforded certain potentially misleading representations

that were made to the DeRogatises before Frank’s death about how and when they

should apply for the desired benefits.

The first suit, filed in 2013 and which on appeal is No. 16‐3549, focuses on the

Pension Plan. In it, Emily named as defendants the Plan’s administrators: the board and

several individual trustees of the Central Pension Fund of the International Union of

Operating Engineers and Participating Employers (collectively, the “Pension Fund”).2

She asserted two claims against the Pension Fund: first, a claim for benefits due under

ERISA section 502(a)(1)(B), in which she argued that the clear terms of the Pension Plan

entitled her to the augmented survivor benefit; and second, a claim for breach of

fiduciary duty under ERISA section 502(a)(3), based on her contention that Frank

missed his opportunity to apply for the augmented benefit because of

misrepresentations made by the Fund’s agents.3

2 The Pension Fund defendants comprise the parties styled in the caption for Docket

No. 16‐3549 as defendants‐appellees. The Pension Fund is a trust fund, which cannot itself be sued under the ERISA rights of action that DeRogatis here asserts. The defendants named in Emily’s lawsuit are the Pension Fund’s trustees, who make payments from the Fund pursuant to the terms of the Pension Plan and any applicable collective bargaining agreements. See

(c)(5) (defining the processes for establishing and managing funds for multiemployer benefit plans). In this opinion, we use the “the Pension Fund” to refer collectively to the Fund’s board and trustees, who are suable under ERISA in their capacity as administrators of the Pension Plan (as explained further in Discussion Section III, below).

3 As do the parties, we generally refer to the relevant statutes by their ERISA section numbers rather than by their sections as codified in title 29 of the United States Code. For the reader’s

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In the tandem suit, filed in 2014 and which on appeal is No. 16‐977, Emily sued

the Welfare Plan’s administrators: the board and several individual trustees of the

Welfare Fund of the International Union of Operating Engineers Local 15, 15A, 15C &

15D, AFL‐CIO (collectively, the “Welfare Fund”).4 She brought an ERISA claim for

breach of fiduciary duty under section 502(a)(3), but the relief she sought did not

pertain to health benefits under the Welfare Plan. Rather, she argues that

misrepresentations by Welfare Fund agents about Welfare Plan benefits caused Frank to

delay applying for retirement, thereby sacrificing an augmented survivor benefit under

the Pension Plan. Emily thus seeks to hold the Welfare Fund liable for the decrease in

Emily’s Pension Fund survivor benefits.

The District Court (McMahon, Chief Judge) granted summary judgment to both

sets of defendants on all claims.

With respect to Emily’s section 502(a)(1)(B) claim against the Pension Fund for

benefits due, we conclude, on de novo review, that the Pension Fund was entitled to

reference, we provide here a list of the ERISA sections cited in this opinion, along with their corresponding Code citations and statutory titles:  ERISA § 3,

(Definitions);  ERISA § 102,

(Summary plan description);  ERISA § 205,

(Requirement of joint and survivor annuity and preretirement survivor annuity);  ERISA § 404,

(Fiduciary duties); and  ERISA § 502,

(Civil enforcement).

4 The Welfare Fund defendants comprise the parties styled in the caption for Docket No. 16‐977 as defendants–counter‐claimants–appellees. The “counter‐claimants” designation reflects that in the early stages of the litigation, the Welfare Fund asserted a counterclaim against DeRogatis. The parties eventually stipulated that the Welfare Fund would withdraw the counterclaim with prejudice, and it is not at issue on appeal. We use “the Welfare Fund” to refer collectively to the Welfare Fund board and trustees.

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summary judgment. The plain terms of the Pension Plan establish that Emily was not

entitled to the augmented survivor benefit that she seeks, notwithstanding any

erroneous advice that she may have received. We therefore affirm the District Court’s

decision in No. 16‐3549 on Emily’s section 502(a)(1)(B) claim.

As for her claims in both suits for breach of fiduciary duty under ERISA section

502(a)(3), the District Court granted summary judgment to each Fund on the grounds

that ERISA fiduciaries such as the defendant trustees cannot be held liable for

misrepresentations made to plan participants by non‐fiduciary, “ministerial”

employees. We disagree with the District Court in this regard. We have long interpreted

ERISA to require that Plan fiduciaries provide “complete and accurate” information to

plan members and beneficiaries about their benefits. Estate of Becker v. Eastman Kodak

Co.,

(2d Cir. 1997). We have in the past permitted plaintiffs to pursue

claims for breach of that fiduciary duty that are based on a combination of unclear

written plan materials and misrepresentations made by plan agents who were not

themselves fiduciaries. See

That approach governs Emily’s claims here.

Notwithstanding that disagreement, however, we find that the Pension Plan’s

summary plan description (“SPD”) clearly communicated the eligibility requirements

for the various pension and survivor benefits available under that plan, thereby

satisfying the Pension Fund’s fiduciary duty to provide complete and accurate

information. For that reason, the misrepresentations made by Plan agents do not

establish a breach of that Fund’s fiduciary duty, and we accordingly affirm the District

Court’s award of summary judgment in favor of the Pension Fund on Emily’s section

502(a)(3) claim in No. 16‐3549.

As to the Welfare Fund, however, we rule that the SPD provided by those

trustees fell short of providing the requisite clear explanation of participants’ options to

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receive post‐retirement health benefits. Further, the record contains evidence suggesting

that Welfare Fund agents misstated the Plan’s health benefits when communicating

with the DeRogatises before Frank’s death. When we consider together the SPD and the

statements by Welfare Fund agents, we identify an open question of material fact

concerning whether the Welfare Fund trustees breached their fiduciary duty to provide

the DeRogatises with complete and accurate information about their benefits under the

Plan. In No. 16‐977, therefore, we vacate the judgment entered in the Welfare Fund’s

favor, and we remand the cause to the District Court for further proceedings consistent

with this opinion.

In sum, and for reasons set forth further below, we AFFIRM the District Court’s

judgment in favor of the Pension Fund on all claims asserted in No. 16‐3549; and we

VACATE the judgment entered in favor of the Welfare Fund in No. 16‐977 on

DeRogatis’s section 502(a)(3) claim for breach of fiduciary duty and REMAND that

cause to the District Court for further proceedings consistent with this opinion.

BACKGROUND

The facts as stated in this section are drawn from the extensive summary

judgment record. Although the parties agree on the basic timeline of relevant events,

they dispute many of the finer details, as noted in the sections that follow. Because the

appeals challenge orders granting summary judgment to defendants, we present here

the version of the facts most favorable to DeRogatis’s claims, and we draw all

reasonable inferences in her favor. See Nickʹs Garage, Inc. v. Progressive Cas. Ins. Co.,

(2d Cir. 2017).

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I. The Pension Plan and the Welfare Plan

Frank DeRogatis, the late husband of Emily DeRogatis, worked as an operating

engineer until shortly before his death in September 2011. As a member of Local 15 of

the International Union of Operating Engineers in New York City, Frank was eligible to

participate in union‐affiliated multiemployer employee benefit plans. These included

the Pension Plan, which provides pension and survivor benefits to participants and

their families, and the Welfare Plan, which provides health benefits.5

A. Pension and survivor benefits available under the Pension Plan

Under the Pension Plan, participants can choose among various options as to

both the timing of their retirements and the structure of their pension and survivor

benefits. The following summary of those benefits is drawn from the summary plan

description that the Pension Fund distributed to Plan members.6 (As described below in

Discussion Section II.B, the parties dispute the precise mechanisms by which members

may qualify for certain benefits, and also whether the SPD accurately reflects the

binding terms of the Pension Plan.)

1. Pension benefits

As Pension Plan members accumulate years of qualifying work experience, they

become eligible under the Plan for different forms of retirement: “early” (at age 55),

5 For definitions of these statutory terms of art, see ERISA §§ 3(1) (welfare plans), 3(2)(A) (pension plans), 3(37)(A) (multiemployer plans).

6 The Pension Fund amended the Pension Plan SPD on August 1, 2011, shortly before Frank died. No party has alerted the Court to any material differences between the two versions of the SPD that were in effect during the time period at issue in these appeals. In this opinion, we cite to the August 1, 2011 version of the Pension Plan SPD, and we speak in the present tense as to what the Pension and Welfare Plans offer and the SPDs state, without regard to any subsequent changes, as these are not reflected in the record.

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“special” (at age 62), and “normal” (at age 65). Each form of retirement is linked to

different types of pension and survivor benefits. In the months preceding Frank’s death

at age 61, he was eligible for “early” retirement, but not yet for “special” or “normal”

retirement. A Pension Plan member who wishes to retire must select among the various

forms of pension benefits that are available to him (or her) under the Plan. The Pension

Fund will not begin to pay pension benefits until the retiree has selected a benefit type,

and, once the selection is made, it cannot be changed.

The Plan provides that, for all three retirement statuses (early, special, and

normal), the “normal form of benefit” for a married retiree is the qualified joint and

survivor annuity (the “Joint Annuity” pension). Pension App’x 1805.7 With a Joint

Annuity pension, the retiree accepts a lower monthly benefit payment during his

lifetime in exchange for the right to designate his spouse as an additional beneficiary;

after the retiree dies, the spouse is entitled to receive a portion of the annuity payment

for his or her lifetime.8

A retiree who selects the Joint Annuity pension must, at the time of benefit

election, designate a spousal benefit percentage of between 50 and 100%. The higher the

spousal benefit percentage after the retiree’s death, the lower the monthly benefit

amount will be during the retiree’s lifetime.

Record citations to the “Pension App’x” refer to the joint appendix filed in No. 16‐3549. 7

Citations to the “Welfare App’x” refer to the joint appendix filed in No. 16‐977.

8 The Plan also allows retirees, including married retirees, to choose a benefit structure that does not include a spousal entitlement. If a retired Plan member selects the Joint Annuity benefit but outlives his spouse, then the Pension Fund will increase the member’s monthly benefit payment after the spouse’s death to the amount he would have received under the “single life annuity” benefit.

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2. Survivor benefits

The Joint Annuity pension features a survivor benefit, as described above: if a

retiree receiving a Joint Annuity pension dies, the retiree’s spouse will receive the

designated spousal entitlement until the spouse’s own death. If a Pension Plan member

was not already receiving a pension benefit at the time of his death, however, the

amount and duration of the payable death and survivor benefits will depend on several

factors. For a member in Frank’s position—someone who, at the time of death, was both

married and eligible for “early” retirement—the member’s spouse is entitled to a

qualified preretirement survivor annuity (the “Preretirement Annuity”) equivalent to

50% of the member’s accrued retirement benefit. This “50%” Preretirement Annuity is

not necessarily equivalent to the survivor payment under a “50%” Joint Annuity,

however.9 In this instance, the Fund calculated Emily’s monthly Preretirement Annuity

payment as $787, an amount midway between the estimated survivor benefit payments

she would have received under a 50% Joint Annuity (approximately $590) and a 100%

Joint Annuity (approximately $1,080).

B. Health benefits available under the Welfare Plan

The Welfare Plan provides Local 15 members with coverage for their healthcare

costs. Unlike many employer‐sponsored health plans, the Welfare Plan does not

designate an annual enrollment period during which eligible employees may sign up to

9 For this reason, we find potentially misleading the parties’ references to a “50% Preretirement Annuity” benefit. As a matter of law, the payments under a Preretirement Annuity can be no smaller than the payments a surviving spouse would have received under the Plan’s 50% Joint Annuity. See ERISA § 205(e)(1). The Preretirement Annuity payments can be larger, however, as turned out to be the case for Emily. To minimize confusion, in this opinion we refer simply to the “Preretirement Annuity” survivor benefit, as contrasted with the Joint Annuity pension and survivor benefit that is available at multiple spousal benefit percentage levels.

11

receive benefits. Rather, Plan members intermittently accrue coverage for the future

based on the number of hours they have worked.

Thus, every four months, members submit their employment records for the

preceding four‐month coverage‐accrual period. The Welfare Fund tallies each member’s

hours of qualifying labor, then credits the member with up to twelve months of future

healthcare coverage. Early retirement does not affect an entitlement to future healthcare

coverage that has already accrued in this way. Thus, if a member earns twelve months

of future coverage and then elects to take early retirement four months after coverage

has begun, the member remains entitled to the remaining eight months of coverage

under the Welfare Plan.10

C. The relationship between the Welfare Fund and the Pension Fund

The Welfare Fund maintains an office in New York City to serve Local 15’s

members. The Pension Fund, in contrast, operates from its headquarters in Washington,

D.C., and has no office in New York City. The two Plans have no direct formal

affiliation with each other, but employees at the Welfare Fund office nonetheless

provide certain services to Pension Plan members. For example, Local 15 members who

visit the Welfare Fund’s New York office may obtain copies of the Pension Plan SPD,

and may also submit Pension Plan applications for retirement and pension. If a Local 15

member asks questions about Pension Plan benefits, Welfare Fund employees generally

direct the member to contact the Pension Fund directly. At their depositions, however,

Although the parties’ portrayals of the Welfare Plan’s operation in this regard coincide, they 10

diverge on the question whether the Welfare Plan SPD describes those procedures with the reasonable clarity to which its members are entitled under the law. See Discussion Section III.B.3, below.

12

some Welfare employees testified that they occasionally helped Local 15 members

identify relevant pages in the Pension Plan SPD, or glanced through a member’s

Pension Plan application to check for completeness before it was submitted. In addition,

when a member scheduled a meeting with Welfare Fund employees to discuss

retirement, it was not unusual for the Welfare employees to contact the Pension Fund

and request a pension benefit estimate on the member’s behalf.

II. The DeRogatises’ interactions with the Funds

Frank was diagnosed with lung cancer in January 2011. He died in September. In

the intervening nine months, he and Emily discussed Frank’s benefit plans with two

Welfare Fund employees in New York City: Patrick Keenan (an office administrator)

and Richard Lopez (a claims specialist).11 Following Frank’s death, Emily applied to the

Pension Fund for the 100% Joint Annuity benefit that she understood Frank had elected

for her, but received instead the (smaller) Preretirement Annuity.

A. Interactions with Patrick Keenan

In early March, approximately two months after Frank’s diagnosis was made, he

and Emily met with Keenan at the Welfare Fund’s New York office to discuss Frank’s

possible retirement. Keenan described Frank’s post‐retirement options for health

benefits under the Welfare Plan and for pension benefits under the Pension Plan, and

gave the DeRogatises a copy of the Pension Plan retirement application. Frank told

Keenan that he wanted to elect the 100% Joint Annuity benefit.12

The details of these interactions are disputed. For purposes of this appeal, the Court must take 11

as accurate the account provided by Emily, the non‐moving party. Nickʹs Garage,

.

Emily testified in deposition that, after Frank expressed this desire, Keenan “gave him a paper 12

to sign.” Pension App’x 2183. Emily presumed that the document recorded Frank’s request for the 100% Joint Annuity. The record on appeal does not contain any document from the March

13

After the meeting, Keenan sent Frank a letter dated March 11, 2017, responding

to questions raised at the meeting about “what type of Pension, Welfare and Annuity

benefits Emily would be entitled to receive if, while actively working, [Frank] passed

away” and, in the alternative, “what benefits [Frank] and Emily would be entitled to

receive if [Frank] elected to retire.” Pension App’x 901–02 (emphases in original). Keenan

attached to the letter a copy of the Pension Plan SPD, as well as a pension benefit

estimate that he had acquired from the Pension Fund on Frank’s behalf. The estimate

document showed the benefit payments that Frank and Emily could expect to receive

under the Joint Annuity at the various spousal benefit percentage levels, as well as

under a single life annuity without a spousal benefit.

With respect to the benefits that Emily would receive if Frank died “while

actively working,” Keenan’s letter directed Frank to consult the Pension Plan SPD

provisions that discuss Preretirement Annuities, and stated that, under the Welfare

Plan, Emily would be entitled to three years of health coverage following Frank’s death.

Id. at 901 (emphasis omitted). The letter then turned to the benefits that would be

available if Frank “elected to retire.” Id. at 902 (emphasis omitted). It cited to section 8 of

the Pension Plan SPD, which defines the options for pension benefits (including the

Joint Annuity) and for death and survivor benefits (including the Preretirement

Annuity). The letter also referenced the attached estimate document, which it described

as listing “the percentage and corresponding dollar amounts for each of the [Joint

Annuity] options that the [] Pension Fund provides.” Id.

2011 meeting that bears Frank’s signature, however, nor has any party identified a Pension Plan document that would allow members to elect a form of pension benefit before applying for retirement. Thus, while Emily’s recollection of Frank signing a paper in Keenan’s office might explain her subjective expectation that she would receive the 100% Joint Annuity survivor benefit, the Court does not find it reasonable to infer from her testimony that Frank signed a document effecting his election of that benefit.

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As to health benefits, the letter did not address the consequences of early

retirement, the only type of retirement for which Frank was eligible. Instead, the letter

stated that if Frank “met the eligibility requirements for normal retirement,” or if he

retired after receiving a Social Security disability award, the Welfare Plan would

provide Frank and Emily with “active [health] benefits until such time that [the

benefits] would expire.” Id. at 902 (emphasis added). The letter referred to the

corresponding provisions in the Welfare Plan SPD but offered no further explanation as

to when the DeRogatises’ health benefits would expire after Frank’s “normal”

retirement.

Emily acknowledges that, when Keenan’s letter arrived, she did not read it

closely, and neither she nor Frank reviewed the cited portions of the Pension and

Welfare Plan documents.

B. Interaction with Richard Lopez

Frank was hospitalized with pneumonia in late July of 2011. While he was in the

hospital, he and Emily completed the Pension Plan application for “early” retirement

and Emily brought it with her to the Welfare Fund office in early August.13 In the

vestibule of the office, she spoke with Lopez, a Welfare Fund claims specialist, telling

him that Frank had lung cancer and intended to retire, but that she had not yet

13 In its 2015 opinion, the District Court cited the amended complaint for the proposition that Frank “had selected the 100% survivor’s benefits option on his pension application.” DeRogatis v. Bd. of Trs. of the Cent. Pension Fund of the Int’l Union of Operating Eng’rs. (“DeRogatis I”), No. 13 CIV. 8788,

, at *2 (S.D.N.Y. Apr. 2, 2015). The summary judgment record includes a copy of Frank’s signed retirement application, however, and nowhere on the application form do we see any mention of the 100% Joint Annuity or of any other form of pension benefit. See Pension App’x 1000–02. We are not aware of any record evidence suggesting that Frank elected a particular form of pension benefit in his retirement application.

15

submitted the retirement application because she did not have all of the necessary

supporting documents.

Lopez advised Emily not to file the application. He explained that if Frank

retired before reaching age 62 the following spring, the DeRogatises would lose their

health benefits under the Welfare Plan unless Frank had received a Social Security

disability award.

Lopez’s statement was accurate insofar as a Welfare Plan member who retires

stops accruing additional months of health coverage under the Plan. That was not how

Emily interpreted Lopez’s comments, however. Rather, she (reasonably enough)

understood him to be saying that Frank would lose his health benefits immediately upon

taking early retirement. At the time of Emily’s visit, however, Frank had already earned

future health coverage through April 2012, and as discussed above, he would remain

entitled to those additional months of coverage even if he retired in the interim.14

Emily was concerned about the cost of Frank’s mounting medical bills, and so,

on Lopez’s advice as she understood it, she decided not to submit Frank’s retirement

application. Instead, she applied on Frank’s behalf for the Welfare Plan’s short‐term

disability benefit, which would provide a limited stream of income while Frank was too

sick to work. Emily did not contact the Pension Fund in Washington directly or

otherwise seek to confirm what she understood from Lopez about Frank’s current

eligibility for health, pension, or survivor benefits.

Lopez’s statement about the DeRogatises’ options for post‐retirement health coverage was 14

potentially misleading in another respect as well: he did not mention the possibility of extending health coverage for up to 18 months after Frank terminated his employment, as permitted under the Consolidated Omnibus Budget Reconciliation Act of 1985 (“COBRA”), 29 U.S.C. §§ 1161–62.

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C. Emily’s application for survivor benefits

Frank died in September 2011 without having filed a retirement application with

the Pension Fund. Later that month, Emily applied for survivor benefits, expecting to

receive the 100% Joint Annuity that Frank had intended for her. As of March 2011, the

100% Joint Annuity benefit was estimated at $1,076 per month. In response to her

application, however, the Pension Fund determined that she was entitled only to the

Preretirement Annuity, which provided a monthly payment of $787, a difference of

almost $300.

To challenge this determination, Emily pursued several rounds of administrative

appeal with the Pension Fund, initially proceeding pro se and later with the benefit of

counsel. During these appeals, she sent to the Fund the early retirement application that

Frank had signed, but that had not been submitted, before his death. At the close of

these proceedings, the Pension Fund reaffirmed its conclusion that Emily was not

entitled to the 100% Joint Annuity, notwithstanding the posthumously filed retirement

application. It continued to pay her the Preretirement Annuity.

III. Procedural history

A. DeRogatis’s claims

In December 2013, while her administrative appeals were ongoing, Emily sued

the Pension Fund in the Southern District of New York seeking two types of relief: an

injunction requiring the Pension Fund to provide her with the 100% Joint Annuity

survivor benefit going forward, and monetary compensation for the shortfall in the

survivor benefit payments she had already received. She asserted two causes of action

under ERISA: first, a claim for benefits due from the Pension Plan under section

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502(a)(1)(B); and second, a claim for breach of fiduciary duty under section 502(a)(3).15

The fiduciary breach claim rested on misrepresentations alleged to have been made by

Keenan and Lopez in their capacity as apparent agents of the Pension Fund.

The following year, in November 2014, DeRogatis separately sued the Welfare

Fund, also in the Southern District of New York. She asserted a single claim against the

Welfare Fund under section 502(a)(3), for breach of fiduciary duty based on Lopez’s

alleged misrepresentations. She sought monetary relief sufficient to compensate her,

both retrospectively and prospectively, for the difference between the Preretirement

Annuity that she was receiving from the Pension Fund and the 100% Joint Annuity to

which she claimed she was entitled.

B. The District Court’s decisions

The District Court consolidated the two cases in March 2015. Over the following

one and one‐half years, the District Court issued multiple orders that collectively de‐

consolidated the two cases and granted summary judgment to all defendants on all

claims.16

In this lawsuit, as in the suit against the Welfare Fund, DeRogatis asserted an additional claim 15

under ERISA § 502(a)(3)(B) for “other appropriate equitable relief.” The District Court construed those claims as duplicative of the claims for breach of fiduciary duty, which arise under the same provision of ERISA and which appeared to target the same alleged ERISA violations. On appeal, DeRogatis has not challenged that construction.

16 See DeRogatis I,

(granting the Pension Fund’s motion for summary judgment as to DeRogatis’s claim for benefits due, but denying the motion as to her claim for breach of fiduciary duty); DeRogatis v. Bd. of Trs. of the Cent. Pension Fund of the Int’l Union of Operating Eng’rs (“DeRogatis II”),

(S.D.N.Y. 2016) (granting summary judgment to the Welfare Fund on the fiduciary breach claim), reconsid. denied (“DeRogatis III”), No. 13 CIV. 8788,

(S.D.N.Y. Apr. 1, 2016) (rejecting DeRogatis’s additional arguments as to fiduciary breach and de‐consolidating the two cases); DeRogatis v. Bd. of Trs. of the Cent. Pension Fund of the Int’l Union of Operating Eng’rs & Participating Emp’rs (“DeRogatis IV”), No. 13 CIV.

18

With respect to DeRogatis’s claim against the Pension Fund for benefits due, the

District Court found no abuse of discretion in the Fund’s determination that, under the

terms of the Pension Plan, Emily was entitled only to the Preretirement Annuity benefit,

and not the 100% Joint Annuity benefit. As to the claims for breach of fiduciary duty,

the court concluded that both Funds were entitled to summary judgment because

Keenan and Lopez performed the type of “ministerial” functions that do not give rise to

fiduciary duties.17 The court further concluded that neither Fund was liable under the

theory of fiduciary breach articulated in Estate of Becker v. Eastman Kodak Co.,

(2d Cir. 1997), in which we held that a plan administrator may be liable for fiduciary

breach based on a combination of unclear summary plan descriptions and misleading

statements made by benefits counselors. In the District Court’s view, each Fund had

issued sufficiently clear plan documents to warrant summary judgment in their favor

even under a Becker theory. The court entered final judgment in both cases and these

appeals followed. We heard the appeals in tandem.

DISCUSSION

On appeal, DeRogatis challenges the District Court’s summary judgment

decisions as to each of her three ERISA claims.18 As noted, we review grants of

8788,

(S.D.N.Y. Sept. 19, 2016) (granting summary judgment to the Pension Fund on the claim for fiduciary breach).

The District Court identified a genuine dispute of material fact as to whether Keenan and 17

Lopez acted as apparent agents of the Pension Fund in their interactions with the DeRogatises, DeRogatis I,

, at *10, but as explained above, the court ultimately granted summary judgment to the Pension Fund on other grounds.

DeRogatis also purports to appeal separately the District Court’s denial of her motion to 18

reconsider the grant of summary judgment to the Welfare Fund. DeRogatis’s motion for reconsideration merely restated her argument under Becker, a theory that she had already articulated—and thus preserved for appeal—in her opposition to the Welfare Fund’s motion for summary judgment. See, e.g., Vega v. Hempstead Union Free Sch. Dist.,

, 80 n.5 (2d Cir.

19

summary judgment de novo, resolving all ambiguities and drawing all reasonable

inferences in favor of the non‐moving party. Nickʹs Garage,

. For the

reasons set forth below, we affirm the award of summary judgment to the Pension

Fund on DeRogatis’s claim for benefits due. As for DeRogatis’s claims for breach of

fiduciary duty, we affirm the grant of summary judgment to the Pension Fund and

vacate the grant of summary judgment to the Welfare Fund.

I. The summary judgment standard

A party moving for summary judgment bears the burden of “show[ing] that

there is no genuine dispute as to any material fact and [that] the movant is entitled to

judgment as a matter of law.” Fed. R. Civ. P. 56(a). In this case, defendants moved for

summary judgment on claims for which DeRogatis would have borne the ultimate

burden of proof at trial. In such a posture, the moving defendants may “satisfy [their]

burden of production under Rule 56” by “negat[ing] an essential element of the

[plaintiff’s] claim,” whether by submitting undisputed evidence to that effect or by

demonstrating the insufficiency of the plaintiff’s own evidence. Nickʹs Garage,

. By the same token, the moving defendants will be denied summary judgment “if

the evidence is such that a reasonable [factfinder] could return a verdict for the

[plaintiff].” Anderson v. Liberty Lobby, Inc.,

(1986).

2015). We therefore address her Becker argument in our de novo review of the District Court’s summary judgment decision, rather than under the “abuse of discretion” standard we apply when reviewing denials of motions for reconsideration. See Stevens v. Miller,

(2d Cir. 2012).

20

II. DeRogatis’s claim against the Pension Fund for benefits due

Section 502(a)(1)(B) of ERISA authorizes a “participant or beneficiary” to bring a

civil action to “recover benefits due to him under the terms of his plan.”19

(a)(1)(B). DeRogatis invokes this provision to challenge the Pension Fund’s

decision to award her the Preretirement Annuity survivor benefit instead of the (larger)

100% Joint Annuity benefit. Under the terms of the Pension Plan, she argues, she was

entitled to the 100% Joint Annuity based on the application for early retirement that

Frank signed, but did not submit, before his death. We conclude that the terms of the

Plan support the Pension Fund’s decision. We therefore affirm the award of summary

judgment to the Pension Fund on this section 502(a)(1)(B) claim.

A. Judicial review of benefit denials

Courts interpret ERISA plans “according to federal common law.” Fay v. Oxford

Health Plan,

(2d Cir. 2002). We “review the Plan as a whole, giving

terms their plain meanings,” and construing any ambiguities “in favor of the plan

beneficiary.”

When a plaintiff asserts a claim for benefits due, we review the plan

administrator’s decision de novo unless “‘the benefit plan gives the administrator . . .

discretionary authority to determine eligibility for benefits or to construe the terms of

the plan,’ in which case an arbitrary and capricious standard applies.” Halo v. Yale

Health Plan, Dir. of Benefits & Records Yale Univ.,

(2d Cir. 2016) (quoting

Firestone Tire & Rubber Co. v. Bruch,

(1989)). Even when the plan confers

19 We begin by addressing this claim because, where “adequate relief is available under [§ 502(a)(1)(B)],” there is “no need . . . to also allow equitable relief under § 502(a)(3),” the section under which DeRogatis asserts her claims for breach of fiduciary duty. Frommert v. Conkright,

(2d Cir. 2006); see also Varity Corp. v. Howe,

(1996) (“[W]here Congress elsewhere provided adequate relief for a beneficiary’s injury, there will likely be no need for further equitable relief.”).

21

such discretion, we review de novo those cases in which a plan “fail[s] to comply with

the Department of Labor’s claims‐procedure regulation[s],” unless that failure “was

inadvertent and harmless” with regard to the claim at issue. Id. at 58 (emphasis in

original).

B. The claim for benefits due under the Pension Plan

DeRogatis concedes that the Pension Plan vests the Pension Fund with

discretionary authority to interpret and apply the Plan. She argues, still, that her

benefits denial should be reviewed de novo because the Pension Fund failed to comply

with certain federal regulations when it adjudicated her appeals. We need not assess

DeRogatis’s assertion of regulatory noncompliance, however, because we conclude that

the Pension Fund’s benefits determination survives de novo review.

The Pension Fund invoked section 12.01 of the Plan as the basis for its denial of

DeRogatis’s request for a 100% Joint Annuity. That section, which appears in the Plan

under the heading “Death of Employee,” provides as relevant here: “The

[Preretirement] Annuity payable to a Qualified Spouse, who survives a Participant with

a Vested Interest and who dies prior to his Annuity Starting Date, shall be an amount

equal to fifty percent (50%) of such Participant’s Accrued Benefit on the date of his

death.” Pension App’x 197. This provision clearly applies in this instance, given that, at

the time of Frank’s death, he was eligible for early retirement (he had a “Vested

Interest”), but had not applied for retirement or begun receiving a pension benefit (he

died “prior to his Annuity Starting Date”). The Fund thus acted properly in awarding

DeRogatis the Preretirement Annuity, defined under the Plan as the benefit payable to a

“Qualified Spouse[] who survives a deceased Participant with a Vested Interest, as

provided in Section 12.01.” Id. at 100.

22

DeRogatis argues, however, that another Plan provision, section 10.03, entitles

her to the 100% Joint Annuity based on Frank’s signed application for early retirement,

which she submitted to the Pension Fund in connection with her administrative appeals

after Frank died. Section 10.03, which appears in the Plan under the heading “Payment

of Retirement Benefits,” instructs that:

An application for retirement benefit payments must be filed by the Participant for benefit payments to commence. . . . If the application is filed at any time after the first month for which the Participant could have been entitled to such benefits, it will be accepted as an application for benefits as of the earliest date the Participant was entitled to such benefits, up to twelve (12) months immediately preceding the month in which the application is filed.

Id. at 180.

On its face, this language appears to permit retroactive applications for

retirement benefits even if a Plan member is no longer alive when the application is

filed; after all, it makes no mention of death of the “Participant.” DeRogatis’s argument

fails to account, however, for the difference between an application for retirement status

and an application for the “retirement benefit payments” adverted to in section 10.03. A

Pension Plan member begins the retirement process by applying for a particular form of

retirement, such as “early” or “normal” retirement. Once the Pension Fund confirms

that the member is eligible for the retirement status sought, id. at 121, the Fund sends

the member an estimate of the payment amount the member would receive under each

type of pension benefit, including, if applicable, the Joint Annuity at different spousal

percentage levels, id. at 169–70. The member must then return a form in which he

designates the desired pension benefit structure. Id. The Pension Fund does not begin

making benefit payments until it receives the completed election form. Id. at 180.

23

Frank did not apply for retirement before his death, and so the Pension Fund

never sent him a final benefit estimate, nor did he complete a benefit election form.

Section 10.03 thus does not apply, and Plan section 12.01, relied on by the Pension Fund,

controls. After his death, therefore, Frank was not eligible for the 100% Joint Annuity

benefit.20

In an attempt to defeat this conclusion, DeRogatis points to her 2011 meeting

with Keenan, when Frank stated that he wanted Emily to receive the 100% Joint

Annuity. She argues that Frank’s statement then should excuse the absence of a written

benefit election later. Her position has some basic appeal, but we are mindful that—as

the Supreme Court has emphasized—section 502(a)(1)(B)’s language “speaks of

enforcing the terms of the plan, not of changing them.” CIGNA Corp. v. Amara,

(2011) (emphases in original) (internal quotation marks and alterations

omitted). DeRogatis has not identified any Pension Plan provision that would permit a

member to elect the 100% Joint Annuity by making an oral representation before

retirement in lieu of submitting a written benefit election after retirement. Neither the

statute nor the Plan envision discretionary amendments to the Plan’s terms, whether by

plan administrators or reviewing courts. See id.; Pension App’x 103 (Pension Plan

section 2.03 requires the Pension Fund trustees, in administering the Plan, to “act in a

20 In line with this conclusion, we note further that the Pension Plan SPD states that only living members may file applications for retroactive benefits, as discussed below in Discussion Section III.B.2. As “important as [SPDs] are,” however, “their statements do not themselves constitute the terms of the plan for purposes of § 502(a)(1)(B).” CIGNA Corp. v. Amara,

(2011) (emphasis in original). While a “court [may] look outside the plan’s written language in deciding what [the plan’s] terms are, i.e., what the language means,” a court may not use section 502(a)(1)(B) to enforce SPD language that is inconsistent with the plan document.

. We thus analyze DeRogatis’s claim for benefits due by looking to the terms of the Pension Plan itself. Because we conclude that the Plan unambiguously establishes the DeRogatises’ eligibility for pension and survivor benefits, we need not look beyond the four corners of the Plan document to the SPD or other material.

24

uniform manner under like circumstances with respect to all similarly situated

Participants”).

Taking a different tack, DeRogatis next counters that the Joint Annuity benefit is

an ERISA‐mandated form of joint and survivor benefit, and that the Pension Fund

“cannot condition entitlement to [mandatory benefits] on requiring the participant to

make an election.” Pension App’t Reply Br. 19. What DeRogatis fails to mention,

however, is that the ERISA provision on which she relies requires the Pension Fund to

offer both a joint and survivor annuity benefit (available to a “vested participant who

does not die before the annuity starting date”) and a preretirement annuity benefit

(available to the spouse of a “vested participant who dies before the annuity starting

date”). ERISA § 205(a).21

On de novo review, we therefore conclude that the Pension Fund acted in

accordance with the Plan and the statute when it awarded Emily a Preretirement

Annuity, the benefit prescribed in Plan section 12.01 for the surviving spouse of a

member who dies without having both retired and begun receiving a pension benefit.

For these reasons, we affirm the District Court’s grant of summary judgment to the

Pension Fund on DeRogatis’s claim under section 502(a)(1)(B) for benefits due.

III. The claims against both funds for breach of fiduciary duty

Section 502(a)(3) of ERISA authorizes plan participants, beneficiaries, and

fiduciaries to initiate a civil action “to enjoin any act or practice which violates any

provision of [ERISA] or terms of the plan, or [] to obtain other appropriate equitable

relief.”

(a)(3). This section allows plan beneficiaries to bring individual

The Pension Fund is subject to these requirements by virtue of its design as a “defined 21

benefit” plan. ERISA § 205(b)(1).

25

actions seeking injunctive relief for an asserted breach of fiduciary duty. See Bell v.

Pfizer, Inc.,

(2d Cir. 2010). Our precedent holds that, to state a claim

under section 502(a)(3) for fiduciary breach based on a defendant’s alleged failure to

provide complete and accurate information about plan benefits, a plaintiff must

establish three elements: (1) the defendant was performing a fiduciary function when it

engaged in the conduct at issue in the complaint; (2) the defendant breached a fiduciary

duty; and (3) the plaintiff is entitled to equitable relief. See

at 73–74; Amara, 563 U.S.

at 443–45.

DeRogatis asserts that the Pension Fund clothed Keenan and Lopez (Welfare

Fund employees) with apparent authority to speak on the Pension Fund’s behalf, and

that, through their misrepresentations, the Pension Fund breached a fiduciary duty to

appropriately advise the DeRogatises about how to obtain their pension and survivor

benefits. In similar vein, DeRogatis asserts that the Welfare Fund breached a duty when

Lopez misstated the DeRogatises’ eligibility for post‐retirement health coverage. Each

set of misrepresentations, she argues, caused her and her husband to delay submitting

Frank’s retirement application, thereby inadvertently forfeiting the opportunity to

apply for the 100% Joint Annuity benefit. She seeks equitable relief that would make her

whole, whether by enjoining the Pension Fund to provide her with the 100% Joint

Annuity benefit for her lifetime, or by imposing a surcharge on one or both Plans that

would compensate her for the difference between the Preretirement Annuity she is

currently receiving and the 100% Joint Annuity that Frank intended her to have.

For the reasons set forth below, we conclude that the District Court erred in

holding that neither Fund performed a fiduciary function through Keenan and Lopez

when those agents communicated with the DeRogatises about their benefits. We

nonetheless affirm the court’s award of summary judgment to the Pension Fund,

26

concluding that the Fund fulfilled its fiduciary duty of communication in this instance

through its written summary plan description.

With respect to the Welfare Fund, however, we perceive a dispute of material

fact bearing on the question of fiduciary breach: that is, whether the Fund’s written plan

materials, combined with purported misrepresentations by the Fund’s employees,

failed to adequately inform the DeRogatises about the effect that Frank’s early

retirement would have on the couple’s health benefits under the Welfare Plan. We

therefore vacate the award of summary judgment to the Welfare Fund and remand to

the District Court for consideration of whether, on the present record, a factfinder could

reasonably conclude that DeRogatis is entitled to equitable relief. If not, then the

Welfare Fund may be entitled to summary judgment, notwithstanding the dispute of

fact as to whether the Fund breached a fiduciary duty.

A. Fiduciary function

As administrators of their respective plans, the Pension and Welfare Fund

trustees act as fiduciaries when they communicate with Plan members and Plan

beneficiaries about their benefits. The fiduciary quality of their function continues when

they communicate on those key topics through the statements of agents who do not,

themselves, meet the definition of a “fiduciary” in their own right. We therefore reject

the Funds’ contention that they cannot be liable for breach of fiduciary duty based on

statements made by non‐fiduciary, “ministerial” employees. Accordingly, we conclude

that neither Fund demonstrated an entitlement to summary judgment based on the

“fiduciary function” element of Emily’s claims for breach of fiduciary duty: a factfinder

could reasonably conclude that the Funds performed a fiduciary function when speaking

through the Welfare Fund’s ministerial employees.

27

1. Legal standard

The Supreme Court has established the context for our consideration of such

section 502(a)(3) claims as Emily asserts here: “In every case charging breach of ERISA

fiduciary duty, . . . the threshold question is . . . whether [the defendant] was acting as a

fiduciary (that is, was performing a fiduciary function) when taking the action subject to

complaint.” Pegram v. Herdrich,

(2000). As relevant for these appeals,

ERISA provides that a “person is a fiduciary with respect to a plan to the extent [that]

he exercises any discretionary authority or discretionary control respecting

management of [the] plan,” or “has any discretionary authority or discretionary

responsibility in the administration of [the] plan.” ERISA § 3(21)(A). Therefore, we

determine whether an individual or entity is an ERISA fiduciary “by focusing on the

function performed, rather than on the title held.” Blatt v. Marshall & Lassman,

(2d Cir. 1987).

Shortly after ERISA’s enactment in 1974, the Department of Labor (“DOL”)

issued guidance on several “aspects of fiduciary responsibility” arising under the new

statute.

.75‐8 (1975). In the guidance document, DOL explained that a

plan employee does not act as a fiduciary when “perform[ing] purely ministerial

functions . . . within a framework of policies, interpretations, rules, practices and

procedures made by other persons . . . because [he] does not have discretionary

authority or [] control respecting management of the plan.”

at D‐2(A). As examples

of ministerial functions, it cited (among other functions) “[a]pplication of rules

determining eligibility for participation or benefits” and “orientation of new

participants and advising participants of their rights and options under the plan.”

at

D‐2(Q)(1), (7).

28

In Varity Corp. v. Howe,

(1996), however, the Supreme Court clarified

that plan administrators act as fiduciaries when they “answer[] beneficiaries’ questions

about the meaning of the terms of a plan so that those beneficiaries can more easily

obtain the plan’s benefits.”

at 502–03. In Varity, the Court’s specific holding

concerned “information [provided] about the likely future of plan benefits”—that is, a

prediction about whether the plan would continue to exist.

(emphasis added).

In determining that plan administrators act as fiduciaries when sharing such

information, however, the Court observed more generally that ERISA “requires

administrators to give beneficiaries certain information about the plan,” and that

“administrators, as part of their administrative responsibilities, frequently offer

beneficiaries more than the minimum information that the statute requires.”22

The

Court instructed that administrators perform a fiduciary function when they provide

information to help “beneficiaries to make [] informed choice[s]” about the plan,

whether that information concerns the benefits currently available under the plan, or

the ongoing integrity of the plan itself. Id.

2. Conduct by Keenan and Lopez on behalf of the Funds

The District Court awarded summary judgment to both Funds based in part on

its conclusion that, in advising the DeRogatises, Welfare Fund employees Keenan and

Lopez performed purely ministerial functions, and therefore, that their conduct could

not give rise to a breach of fiduciary duty. We agree with the District Court that a non‐

22 The Pension and Welfare Funds administer their respective plans, and so clearly fall within Varity’s core holding. This Court has since cautioned, however, that Varity’s holding does not necessarily apply to other types of ERISA fiduciaries who do not share plan administrators’ statutory “responsib[ility] for meeting ERISA’s disclosure requirements.” In re Citigroup ERISA Litig.,

(2d Cir. 2011), abrogated on other grounds by Fifth Third Bancorp v. Dudenhoeffer,

(2014).

29

fiduciary plan employee is not personally bound by the fiduciary duties imposed by

ERISA, and is therefore not personally subject to liability for fiduciary breach. See

ERISA § 404;

.75‐8. DeRogatis did not name Keenan or Lopez as

defendants in either of her lawsuits, however.23 Rather, she sued each Fund’s board and

individual trustees.

As administrators of their respective plans, the trustees act as fiduciaries when

they communicate with plan members and beneficiaries about plan benefits. See Varity,

516 U.S. at 502–03. That fiduciary function encompasses communications conducted by

issuing written plan materials like summary plan descriptions, as well as through

members’ individualized consultations with benefits counselors. See

(noting the

fiduciary function of “answering beneficiaries’ questions” about plan benefits); see also,

e.g., Bouboulis v. Transp. Workers Union,

, 58, 66 (2d Cir. 2006) (concluding that

a union, when acting as a fiduciary, may be liable for intentional misrepresentations

about benefits that were made to members by union “officers [and] staff”). Thus, the

Funds may perform a fiduciary function through ministerial agents without converting

those individual agents themselves into fiduciaries.

23 This difference in posture distinguishes the present appeal from Tocker v. Kraft Foods North America, Incorporated Retirement Plan,

(2d Cir. 2012), a non‐precedential summary order in which this Court concluded that a human resources employee, Robert Varone, acted in a ministerial capacity “when he researched and communicated to [plaintiff] the benefits [plaintiff] would receive” under the company’s retirement plan.

. The District Court cited Tocker as “the Second Circuit’s most on‐point application of ERISA’s definition of a fiduciary to plan employees.” DeRogatis II,

. In Tocker, however, Varone was named as a defendant. The “only issue” decided in Tocker was whether Varone himself “acted in a fiduciary capacity.”

. The Tocker panel did not address the question presented in this appeal: whether the conduct of a plan employee might contribute to a finding that the plan’s administrator breached a fiduciary duty.

30

As we have described, Keenan and Lopez were Welfare Fund employees, and it

is undisputed that they acted within the scope of their employment when they

communicated with members of Local 15 about health benefits. In addition, as we will

explain, we may assume without deciding that the District Court correctly discerned a

dispute of material fact as to whether Keenan and Lopez acted with apparent authority

as agents of the Pension Fund, as well as of the Welfare Fund. Thus, for purposes of this

appeal, we treat Keenan and Lopez as agents of the Welfare Fund when they advised the

DeRogatises regarding health benefits, and as agents of the Pension Fund when they

offered advice regarding pension benefits: we may presume that those communicative

activities constituted fiduciary conduct attributable to each set of plan administrators.

A. Breach of a fiduciary duty

Having determined that the Pension and Welfare Funds performed a fiduciary

function when they communicated with the DeRogatises about plan benefits, the Court

must next consider whether the District Court could reasonably conclude that either

Fund breached a fiduciary duty in carrying out that obligation.

In Estate of Becker v. Eastman Kodak Co.,

(2d Cir. 1997), we held that a

fiduciary may be liable for fiduciary breach if a plan member is misled due to a

combination of an unclear summary plan description and misrepresentations by the

fiduciary’s agents.

. Here, we agree with the District Court’s conclusion that the

Pension Plan SPD clearly communicates the eligibility requirements for pension and

survivor benefits, thereby precluding liability under Becker. Because the Pension Fund

has negated the “fiduciary breach” element of DeRogatis’s section 502(a)(3) claim, we

affirm the grant of summary judgment to the Pension Fund. As to the Welfare Fund,

however, we conclude that under Becker, DeRogatis may be able to show a breach a

fiduciary duty. The Welfare Fund is thus not entitled to summary judgment based on

31

this element of DeRogatis’s claim, and we must vacate and remand the District Court’s

judgment in this regard.24

1. Legal standard

a. The fiduciary duties imposed by ERISA

Section 404 of ERISA defines multiple fiduciary duties, two of which are relevant

for these appeals. The first is the duty of loyalty, which requires fiduciaries to “discharge

[their] duties with respect to a plan solely in the interest of the participants and

beneficiaries and [] for the exclusive purpose of: (i) providing benefits to participants

and their beneficiaries; and (ii) defraying reasonable expenses of administering the

plan.” ERISA § 404(a)(1)(A). The second is the duty of prudence, which requires

fiduciaries to “discharge [their] duties . . . with the care, skill, prudence, and diligence

under the circumstances . . . that a prudent [person] acting in a like capacity and

familiar with such matters would use.” Id. § 404(a)(1)(B).

The statute “does not . . . elaborate in any detail on the duties owed by a

fiduciary” beyond the text just quoted, and so “courts have . . . been called upon to

define the scope of a fiduciary’s responsibilities.” Becker,

(internal

quotation marks omitted). To assist in that endeavor, the Supreme Court has explained

that “these fiduciary duties draw much of their content from the common law of

trusts,” Varity,

, subject to the caveat that “trust law does not tell the

entire story,”

. Courts must be mindful to preserve ERISA’s “careful balanc[e]”

between the interests of “ensuring fair and prompt enforcement of rights under a plan

On remand, the Welfare Fund may be able to establish its entitlement to summary judgment 24

based on the final element of DeRogatis’s claim of fiduciary breach, the availability of equitable relief. We briefly discuss this element—and our reasons for declining to adjudicate it in this appeal—in Discussion Section III.C, below.

32

and the encouragement of the creation of such plans.” Conkright v. Frommert,

(2010) (internal quotation marks omitted).

b. Fiduciary breach based on misrepresentations

We have long recognized that fiduciaries breach their duty of loyalty if they

“knowingly or intentionally mislead plan beneficiaries as to changes—whether effective

or under consideration—to employee benefit plans.” Bell,

; see also Varity,

. In that context, we have endorsed theories of liability that rest on material

omissions as well as affirmative misstatements. See, e.g., Devlin v. Empire Blue Cross &

Blue Shield,

(2d Cir. 2001) (“When a plan administrator affirmatively

misrepresents the terms of a plan or fails to provide information when it knows that its

failure to do so might cause harm, the plan administrator has breached its fiduciary

duty to individual plan participants and beneficiaries.” (alteration omitted)). But see

Varity,

(declining to “reach the question whether ERISA fiduciaries have

any fiduciary duty to disclose truthful information on their own initiative, or in

response to employee inquiries”).

DeRogatis has not accused either plan of intentionally misleading her or her

husband about their benefits. To establish a breach of fiduciary duty based on

unintentional misrepresentations, DeRogatis must satisfy the more restrictive standard

that we recognized in Estate of Becker: Fiduciaries have a duty to “provide [participants]

with complete and accurate information” about plan benefits,25 and they breach that

25 Becker did not expressly link this fiduciary duty to any of the duties defined in the ERISA statute. Communicating about plan benefits is a fiduciary function, as explained above in Discussion Section III.A.1. While the duty of loyalty prohibits a fiduciary from intentionally misleading a plan member or beneficiary, the duty of prudence imposes a different kind of guardrail: when communicating about benefits, fiduciaries must act “with [] care, skill, prudence, and diligence.” ERISA § 404(a)(1)(B). In other words, they must “provide . . . complete and accurate information.” Becker,

.

33

duty if their agent inadvertently misleads participants about a benefits question on

which the summary plan description, too, is unclear.

. This understanding

of liability builds on plan administrators’ statutory obligation to distribute an SPD that

is “written in a manner calculated to be understood by the average plan participant,”

and that is “sufficiently accurate and comprehensive to reasonably apprise []

participants and beneficiaries of their rights and obligations under the plan.” ERISA

§ 102(a).

Under the pension plan at issue in Becker, an employee seeking to retire had to

submit a retirement application form and comply with various other “necessary

formalities” to qualify for payments.

. The defendant company would not

issue any such payments, however, unless the employee “survived until the ‘effective

date’ of retirement,” which it construed as “the first day of the month after an

employee’s election to retire.”

(emphasis omitted).

On a putative recipient’s challenge to this approach, the Becker panel found it

“questionable whether the SPD clearly alert[ed] participants to the fact that an

employee who elects to retire but dies before the first day of the next month loses her

vested retirement benefits.”

That precise circumstance befell the unsuspecting Carol

Becker, who was terminally ill, but who delayed in filing her retirement papers after a

benefits counselor assured her that she could “take [her] retirement any time [she felt]

like it.”

. The panel declined to decide “whether the SPD was, by itself, so

ambiguous and incomplete as to violate [ERISA]”; for purposes of determining liability,

it was sufficient that the benefits counselor “exacerbated the lack of clarity inherent in

the SPD and thereby provided Becker with materially misleading information.”

. “Taking these circumstances together,” the panel concluded, the employer

34

“breached its fiduciary duty to provide Becker with complete and accurate information

about her retirement options.”26 Id.

2. The Pension Fund

Emily asserts here that the Pension Fund breached its fiduciary duty by failing to

appropriately advise her and Frank that, if Frank did not retire before his death, he

would forfeit his right to the 100% Joint Annuity survivor benefit. We agree with the

District Court’s conclusion, however, that the Pension Plan SPD contained all the

information necessary for the couple to ascertain their rights regarding pension and

survivor benefits. Under Becker, that conclusion is decisive as to the Pension Fund’s

liability.

Under the boldfaced heading “How Your Pension, Disability Or Survivor Benefit

is Paid,” section 8 of the SPD describes the Joint Annuity (available to a plan member

who is married on the date of retirement) and the Preretirement Annuity (awarded to

the surviving spouse of a member who “die[s] before the commencement of retirement

benefits”). Pension App’x 1805–06. A few pages later, under the boldfaced heading

“Benefits Payable in the Event of Your Death,” section 9 of the SPD repeats the message

that the Preretirement Annuity is the benefit provided to the surviving spouse of a

member who “had a right to an early retirement benefit,” but who “had not yet

applied” at the time of death. Id. at 1809 (para. 4). In addition, the SPD expressly

prohibits posthumous applications for retirement benefits by instructing members as

We note that Becker involved a claim of fiduciary breach based on misrepresentations to a plan 26

member, while Emily’s claims rely in part on alleged misrepresentations that Lopez made to her when Frank—the plan member—was not present. Emily received health benefits through Frank’s membership in the Welfare Fund, however, and the fiduciary duties of loyalty and prudence run to both members and beneficiaries, see ERISA § 404(a)(1). Defendants have not argued that Becker’s holding does not apply to misrepresentations made to plan beneficiaries, and we see no reason that its rule should be limited to one class or the other.

35

follows: “In the event you delay in applying for pension benefits, you will receive

retroactive payments to your date of eligibility, . . . provided you are still alive as of the date

the application is received.” Id. at 1815 (emphasis added). In contrast, it advises that “if

you were receiving a normal, special, or early retirement benefit,” then “[a] death

benefit will be paid under the rules for the type of monthly benefit you elected at the

date of your retirement,” and refers the reader to section 8 “[f]or details.” Id. at 1809

(para. 1).

We conclude that, unlike the SPD at issue in Becker, the Pension Plan SPD

“clearly alerts” plan members to the conditions under which their spouses qualify for

pension and survivor benefits, including the 100% Joint Annuity that Emily hoped for

and the Preretirement Annuity that she ultimately received. Becker,

. Thus,

even if Keenan and Lopez did act as the Pension Fund’s agents when they discussed

Frank’s retirement options with one or both of the DeRogatises, and even if Keenan or

Lopez did unintentionally misstate the eligibility requirements for pension and survivor

benefits, the Pension Plan SPD is sufficiently clear to preclude the Pension Fund from

being found culpable for fiduciary breach under a Becker theory.27

27 At least one circuit has suggested that an ERISA fiduciary may breach a duty because of unintentional misrepresentations even when the SPD is clear if there is no evidence that the plaintiff knew or should have known of the applicable SPD provisions at the time of the relevant conduct. See Krohn v. Huron Mem’l Hosp.,

(6th Cir. 1999) (“Providing a summary plan description [four] years before the request for information does not excuse [the fiduciary] from its duty to respond fully and accurately to later inquiries regarding benefits.”). We need not consider any such qualification of Becker because, even under a modified theory, DeRogatis would be unable to show a fiduciary breach. In March 2011, six months before Frank’s death, Keenan sent the DeRogatises a copy of the Pension Plan SPD and specifically cited to the relevant sections on pension and survivor benefits. See Background Section II.A, above; cf. Krohn,

(“[I]t would have been preferable for [the fiduciary] to refer the plaintiff to her [SPD] . . . , and to have given her an additional copy if she had lost her own, than to have” answered her questions through a personnel assistant “in such a careless and incomplete manner.”).

36

We therefore affirm the District Court’s grant of summary judgment to the

Pension Fund on this section 502(a)(3) claim.

3. The Welfare Fund

Emily asserts that, applying Becker principles, the Welfare Fund should be found

to have breached its fiduciary duty to her because neither its Plan documents nor its

agents clearly explained how Frank’s retirement would affect the DeRogatises’

entitlement to health coverage. We conclude that, drawing all reasonable inferences in

her favor, the current record supports that assertion. The Welfare Fund has thus failed

to negate the “breach of duty” element of DeRogatis’s section 502(a)(3) claim, and

further proceedings are necessary.

a. The Welfare Plan SPD

The Welfare Plan SPD runs 156 pages in length and contains neither a table of

contents nor an index. After a brief introduction, the SPD delivers the bulk of its

substantive provisions in a series of alphabetized sections covering topics ranging from

the highly specific to the most generic. (Under the letter E, for example, members can

find information about “Epidural Steroid Injections/Nerve Blockers,” followed by a

section that sweepingly addresses “Exclusions, Exceptions and Plan Limitations.” See

Welfare App’x 678.) The SPD does not contain an alphabetized section named

“retirement” or a relevant cross‐reference for persons seeking information about health

benefits post‐retirement. After the alphabetized sections, the SPD introduces two other

sections discussing benefits for retired Plan members (whom it refers to as “Pension

Members”). The SPD concludes with two sections containing general guidance for Plan

37

members, which contain the following directives: “Read this book in its entirety,” and

“When in doubt ...... ASK!”28

at 766–67.

One of the non‐alphabetized sections toward the end of the SPD is called

“Benefits and Provisions For Pension Members And their Eligible Dependents who are

not eligible for Medicare Benefits.” Id. at 731. In that section, the SPD states that health

benefits for retirees “who are age 62 . . . are generally the same as for active members,”

and directs readers to consult the alphabetized “Eligibility” section. Id. This end‐of‐SPD

section (regarding “Benefits and Provisions . . .”) makes no mention of those “early”

retirees who have not reached the age of 62, and therefore fails entirely to advise a

member in Frank’s position about how early retirement would affect his and his

spouse’s health benefits.

The cited “Eligibility” section further contributes to the SPD’s opacity on this

question. This section is divided into subsections specific to various local unions within

the International Union of Operating Engineers. Those subsections are further divided

into sub‐subsections that define the eligibility rules for the occupants of different roles

within each union (e.g., “Owner Operators” in Local 15D). The relevant section for

28 Its length and structure alone raise a serious question about whether the Welfare Plan SPD fails to satisfy ERISA’s mandate that plan fiduciaries circulate a summary plan description “written in a manner calculated to be understood by the average plan participant.” ERISA § 102(a); see Becker,

(“In assessing the adequacy of an SPD, we consider the document as a whole.”); Amara, 563 U.S. at 437–38 (contrasting the “simplicity and comprehensibility” of an optimal SPD with the “qualifications and nuances” that may be necessary in the full plan description); see also, e.g., Silva v. Metro. Life Ins. Co.,

(8th Cir. 2014) (finding a breach of fiduciary duty where the administrator failed to issue an SPD and instead disseminated a plan description that was “nearly 100 pages long” and that “contain[ed] technical language unlikely to be read or understood by ‘the average plan participant’”). We need not decide this question, however, in light of our conclusion that the SPD, taken together with representations made by the Welfare Fund’s agents, failed to convey “complete and accurate information” as required by Becker,

.

38

Frank, a non‐owner member of Local 15, describes the system by which non‐retired

members earn entitlement to future health coverage, as we have outlined above in

Background Section I.B. In describing that system, however, the SPD occasionally uses

the term “benefit periods” to refer to both the four‐month periods during which

participants accrue future coverage (also referred to as “redemption periods”), as well as

the ensuing periods of four to twelve months during which participants receive coverage

(also referred to as “coverage periods”).29 See

at 662–64.

Then, five pages after the “Local 15” subsection, under the heading “Eligibility

requirements for members who elect early retirement,” the SPD provides almost

impenetrably as follows: “If you elect for early retirement your coverage will cease with

this Plan upon the normal cessation of the benefit period you are covered through at the

time of early retirement approval from the [] Pension Fund.” Id. at 669. Because the SPD

has suggested two mutually exclusive definitions for the operative term “benefit

period,” a diligent member consulting the SPD might understandably remain unsure

about when his health coverage will cease after he takes “early” retirement.30

Moreover, a member of Local 15 might not realize that this provision applies to

him at all. The section dedicated to Local 15 does not direct members to read on for

information about retirement. After the SPD discusses each union (ending with

Local 15D), it introduces the discussion of early retirement using a small‐font

subheading—the same type of subheading used to introduce the various roles within

The SPD contains a “definitions” section, but the terms “benefit period,” “redemption 29

period,” and “coverage period” are not defined in that section.

In addition, in a puzzling lapse, this section does not even mention the possibility of 30

extending coverage under COBRA, a statutorily required option discussed above at note 14. Rather, the Plan’s section on COBRA is located under the letter C, a full 25 pages away from the section addressing early retirement under the heading of “Eligibility.”

39

each union. With no large‐font heading announcing policies of general applicability, a

skimming reader might reasonably (but incorrectly) assume that the “Local 15” section

is self‐contained, and that all the small‐font subheadings that appear under “Local 15D”

apply only to that local union, and not to the others.

For these reasons, we disagree with the District Court’s conclusion that the

Welfare Plan SPD clearly explained all the information the DeRogatises needed to

understand their options for health benefits after Frank’s retirement. After considering

the SPD’s structure, formatting, and substance, as described above, we find it at least

“questionable” whether the SPD “clearly alerts participants” to the consequences of

early retirement for their health benefits. Becker,

.

We emphasize, moreover, that retirement is not a “remote or idiosyncratic

contingency,” but rather an expected—indeed, anticipated—milestone for many union

members. Id.; see also ERISA § 102(b) (providing that SPDs must inform members about

“the plan’s requirements respecting eligibility for participation and benefits,” as well as

the “circumstances which may result in . . . ineligibility, or denial or loss of benefits”). It

is, therefore, eminently reasonable for members to expect the SPD to address that

scenario.

b. The Welfare Fund’s communications with the DeRogatises

The next step in determining whether the Welfare Fund breached a fiduciary

duty requires us to consider whether the Fund’s various communications with the

DeRogatises “exacerbated the lack of clarity inherent in the SPD and thereby provided

[the DeRogatises] with materially misleading information.” Becker,

.

40

Again, drawing all reasonable inferences in Emily’s favor, we conclude that this issue

presents a genuine dispute of material fact.31

Keenan’s March 2011 letter purported to explain the benefits that the

DeRogatises “would be entitled to receive if [Frank] elected to retire,” but spoke only to

a scenario in which Frank “met the eligibility requirements for normal retirement.”

Welfare App’x 230 (emphasis added, other emphases omitted). Keenan’s letter did not

discuss the effects of early retirement—the only retirement option that was available to

Frank at the time of his death. Moreover, Keenan’s letter stated, somewhat

tautologically, that Frank’s health benefits would continue after (normal) retirement

“until such time that they would expire,”

and cited to the Welfare SPD pages

discussed above. The letter thus did not mitigate the plan’s imprecise use of the term

“benefit period.” As for Lopez, Emily understood him to be suggesting, inaccurately,

that the DeRogatises’ health benefits would expire immediately upon Frank’s retirement.

She testified, moreover, that he expressly advised her to delay filing Frank’s retirement

application.

The Welfare Fund defendants parry that, in April 2011, Frank received a check

stub with a benefits summary stating that his health coverage “extended thru” April

2012. Id. at 258. That check stub, the Fund argues, effectively notified Emily of the

duration of Frank’s future coverage. We are unpersuaded by the Welfare Fund’s

argument. The check stub’s pronouncement did nothing to cure the inconsistencies and

Because the District Court found the Welfare Plan SPD sufficiently clear to foreclose liability 31

under Becker, the court did not consider whether the Welfare Fund’s agents made misrepresentations when communicating with the DeRogatises. Given the amply developed record, we see no need to remand on this narrow question.

41

omissions contained in the SPD or the inaccuracies in Lopez’s advice concerning the

effect of retirement on previously credited healthcare coverage.

Looking at the various ways in which the Welfare Fund communicated with the

DeRogatises in the months preceding Frank’s death, we see a genuine dispute of

material fact bearing on whether the Fund breached its fiduciary duty to provide the

couple with “complete and accurate information” about their benefits, taking into

account (1) the murky SPD, (2) the letter from Keenan, and (3) Lopez’s statements.

Becker,

. We thus conclude that the Welfare Fund is not entitled to

summary judgment based on this element of DeRogatis’s claim under section 502(a)(3).

B. Appropriate equitable relief

Although we conclude that the Welfare Fund is not entitled to summary

judgment based on either of the first two elements of DeRogatis’s section 502(a)(3) claim

(fiduciary function and fiduciary breach), the Fund may yet be able to negate the third

element: the availability of appropriate equitable relief. The District Court did not reach

this third element in light of its decision to award summary judgment to the Fund on

other grounds. In this section, we briefly review the standard governing equitable relief

under section 502(a)(3) to help frame the District Court’s analysis on remand of the

question whether, based on the present record, DeRogatis may be entitled to some form

of appropriate equitable relief.

1. Legal standard

Section 502(a)(3) authorizes courts to remedy a breach of fiduciary duty by

“enjoin[ing] any act or practice which violates [ERISA] or the terms of the plan,” or by

ordering “other appropriate equitable relief.”

(a)(3). The Supreme Court

has interpreted this provision as making available “those categories of relief that . . .

were typically available in equity.” Amara,

(internal quotation marks and

42

emphasis omitted). In addition to injunctions, plaintiffs asserting a claim under

section 502(a)(3) may seek remedies such as estoppel, equitable reformation of plan

terms, or a monetary “surcharge” to recompense “a loss resulting from a [fiduciary’s]

breach of duty, or to prevent the [fiduciary’s] unjust enrichment.”

at 440–42. The

showing required of a plaintiff proceeding under section 502(a)(3) thus depends in part

on the particular form of equitable relief sought. See

at 443–44 (noting that

“detrimental reliance” is a required element for estoppel, but not for reformation or

surcharge). If the plaintiff is not entitled to any form of equitable relief, however, then

the plaintiff has failed to state a claim under section 502(a)(3).

2. Relief

Emily asserts that, but for the Welfare Fund’s fiduciary breach, Frank would

have timely retired and applied for (and received) the 100% Joint Annuity. The 100%

Joint Annuity is a benefit defined under the Pension Plan, however, not the Welfare

Plan. Even if Emily successfully proved that the Welfare Fund breached a fiduciary

duty, the District Court could not enjoin the Welfare Fund to enroll her in a survivor

benefit over which that Fund has no control. Even so, DeRogatis might be entitled to an

equitable surcharge remedy that would compensate her for the difference between the

100% Joint Annuity and the Preretirement Annuity, both retrospectively and on an

ongoing basis. See Amara, 563 U.S. at 441–42.

The District Court did not determine what equitable relief, if any, might be

available against the Welfare Fund, nor did the parties brief the issue on appeal. On

remand, the District Court should consider whether Emily will be entitled to a

surcharge or some other form of “appropriate equitable relief” under ERISA

section 502(a)(3) if she successfully proves that the Welfare Fund breached a fiduciary

duty.

43

CONCLUSION

For the reasons set forth above, we AFFIRM the judgment of the District Court in

favor of the Pension Fund in the case designated No. 16‐3549, and we VACATE the

District Court’s judgment in favor of the Welfare Fund in the case designated

No. 16‐977 and REMAND that cause for further proceedings consistent with this

opinion.

44