ERISA – Breach of Fiduciary Duty; Standing: Overfunded Plan 

Posted: 1:00 am Mon, November 9, 2009
By admin
Tags: ERISA

Where a plaintiff, who was a participant in a defined-benefit pension plan, brought an action under ERISA against plan fiduciaries for breach of fiduciary duty, also alleging that they engaged in prohibited transactions, summary judgment for the defendants is affirmed under the circuit precedent of Harley v. Minnesota Mining & Manufacturing Co., which held that a plan participant suffers no injury and thus may not bring an action claiming liability under Section 1109 for alleged breach of fiduciary duties when a plan is overfunded. Judgment is affirmed.

Dissenting opinion by Bye, J.: “I believe the Supreme Court’s recent decision in Sprint Communications Co. v. APCC Services, Inc.,…compels us to reach a different result in this case than the result reached in Harley v. Minnesota Mining & Manufacturing Co. I therefore respectfully dissent….

“Because Harley would compel a result opposite the one we reach when applying Sprint and Vermont Agency, the Supreme Court’s decisions necessarily cast doubt on Harley. Under Sprint and Vermont Agency, McCullough’s Article III standing to sue under sec.1132(a)(2) turns not on whether he suffered an injury, but on whether the Plan suffered a concrete injury which can be redressed through this lawsuit.”