DOL civil actions.
ERISA Section 502 permits the DOL to file the following civil actions:
1. Suits to enforce Title I of ERISA (Protection of Employee Benefit Rights);
2. Suits to require disclosure of individual benefit statements, in accordance with ERISA Section 105(c);
3. Suits to enforce the fiduciary provisions of ERISA and to make the plan whole for any losses resulting from a breach of fiduciary duty; and
4. Suits to collect civil penalties for:
(a) The failure or refusal to file an Annual Report;
(b) A violation of the prohibited transaction provisions; and
(c) Situations in which a breaching fiduciary or a person who knowingly participates in a fiduciary breach is required to make restitution to the plan.
The Fifth Circuit Court of Appeals has held that the DOL's interest in bringing an ERISA action is to safeguard the integrity of the pension system. (1)
ERISA Section 502(j) provides that in all civil actions brought by the DOL, attorneys appointed by the Secretary of Labor may represent him or her. The exception to this general rule is cases presented to the Supreme Court, which will be subject to the direction and control of the Attorney General.
Actions brought by the DOL are subject to the civil procedure rules regarding: (1) standing to sue; (2) jurisdiction over the claim by the court hearing the proceedings; (3) the proper venue of the suit; and (4) under certain circumstances, the seeking of equitable relief, injunctive relief and/or attorneys' fees.
The Fourth Circuit Court of Appeals has ruled that there is no personal ERISA action allowed for a fiduciary's failure to carry out participant investment instructions. (2) The participant's claim for damages, equal to the losses which resulted when the plan administrator failed to carry out the instructions, was not actionable under ERISA's breach of fiduciary duty provision or under ERISA's other appropriate equitable relief provision. The Court, in relying on Mertens v. Hewitt, (3) and Great-West Life and Annuity Insurance Co. v. Knudsen, (4) confirmed that ERISA Sections 1132(a)(2) and 1132(a)(3) provide for forms of equitable relief (unjust enrichment, unlawful possession, or self-dealing) that fall outside of the relief requested by the plaintiff. As such, a motion for judgment on the pleadings in favor of the defendants was affirmed.
785. Can the DOL intervene in an existing ERISA-related civil action?
A copy of all complaints filed in civil actions brought by a participant, beneficiary or a fiduciary regarding alleged violations of ERISA must be served upon the Secretary of Labor.
As a result of an Eleventh Circuit decision, the Secretary of Labor may sue a plan fiduciary for money damages even though an identical claim by a class of plan participants against the same fiduciary was the subject of a final judgment or court-approved settlement. See Q 514. (1)
The Secretary of Labor has the right, in his discretion, to intervene in any action, with the exception of suits brought under Title IV (Plan Termination Insurance). (2)
(1.) Donovan v. Cunningham, 716 F.2d 1455 (5th Cir. 1983).
(2.) LaRue v. DeWolff, Boberg & Associates, Inc., 2006 WL 1668873 (4th Cir. 2006).
(3.) 508 U.S. 248 (1993).
(4.) 435 U.S. 204 (2002).
(1.) Herman v. South Carolina National Bank, 140 F.3d 1413 (11th Cir. 1998), cert. denied, 119 S.Ct. 1030 (1999).
(2.) ERISA Sec. 502(h).