Local 6-0682 International Union of Paper, Allied-Industrial, Chemical & Energy… v. National Industrial Group Pension Plan, an ERISA pension plan

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RECOMMENDED FOR FULL-TEXT PUBLICATION
Pursuant to Sixth Circuit Rule 206
ELECTRONIC CITATION: 2003 FED App. 0326P (6th Cir.)
File Name: 03a0326p.06
UNITED STATES COURT OF APPEALS
FOR THE SIXTH CIRCUIT
_________________
LOCAL 6-0682
INTERNATIONAL UNION OF
PAPER, ALLIED-INDUSTRIAL,
CHEMICAL & ENERGY
WORKERS, AFL-CIO, CLC,
ex rel National Industrial
Group Pension Plan, f/k/a
Local 7682, United
Paperworkers International
Union,
Plaintiff-Appellant,
v.
NATIONAL INDUSTRIAL
GROUP PENSION PLAN, an
ERISA pension plan;
NATIONAL INDUSTRIAL
GROUP PENSION PLAN
ADMINISTRATIVE AGENCY,
and its administrator, a
foreign corporation,
Defendants-Appellees.
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No. 01-2680
2 Local 6-0682 Int’l Union of Paper v. Nat’l
Industrial Group Pension Plan, et al.
No. 01-2680
*The Honorable David A. Katz, United States District Judge for the
Northern District of Ohio, sitting by designation.
Appeal from the United States District Court
for the Western District of Michigan at Grand Rapids.
No. 00-00419—Robert Holmes Bell, Chief District Judge.
Argued: April 30, 2003
Decided and Filed: September 11, 2003
Before: MOORE and ROGERS, Circuit Judges; KATZ,
District Judge.*
_________________
COUNSEL
ARGUED: Jeffrey A. Heldt, KORNEY & HELDT,
Bingham Farms, Michigan, for Appellant. Patrick F. Hickey,
DYKEMA GOSSETT, Detroit, Michigan, for Appellees.
ON BRIEF: Jeffrey A. Heldt, KORNEY & HELDT,
Bingham Farms, Michigan, for Appellant. Patrick F. Hickey,
DYKEMA GOSSETT, Detroit, Michigan, for Appellees.
_________________
OPINION
_________________
ROGERS, Circuit Judge. Plaintiff Local 6-0682 (“Union”)
appeals the district court’s grant of summary judgment to the
defendants National Industrial Group Pension Plan
(“NIGPP”) and the National Industrial Group Pension Plan
Administrative Agency (“Agency”). The Union seeks to
recover benefits under the Employee Retirement Income
Security Act of 1974 (“ERISA”), 29 U.S.C. §§ 1001–1461,

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No. 01-2680 Local 6-0682 Int’l Union of Paper v. Nat’l
Industrial Group Pension Plan, et al.
3
for the Agency’s negligence in providing, as a courtesy, a
benefits-amount quotation that turned out to be erroneous.
Because we decline to infer a federal common law cause of
action for negligence in giving advice to the Union regarding
ERISA plan benefits, we affirm.
The Union is the exclusive bargaining agent for its
approximately 350 members, all of whom are employed by
the Kalamazoo facility of Checker Motor Corp. (“Checker”).
Pursuant to an agreement between the Union and Checker, all
members participate in the NIGPP, a multi-employer pension
plan that is an “employee pension benefit plan” within the
meaning of ERISA, 29 U.S.C. § 1002(2)(A), and
consequently is governed by and subject to ERISA. The
NIGPP, in turn, is administered by the Agency. The Agency
itself is a “third-party administrator” in ERISA parlance. See
Freimark & Thurston Agency, Inc. v. Nat’l City Bank of
Dayton, 231 F. Supp. 2d 713, 720 n.8 (S.D. Ohio 2002).
In March of 1999 the Union and Checker were re-
negotiating their collective bargaining agreement. On
March 15, before the parties had begun negotiating pension
benefits, the Agency sent the Union a Supplement Quotation
letter to aid the Union in its pension negotiations. The letter
explained that “[t]his quotation . . . is consistent with the
applicability of your last certified increase” and stated that
“[a] $.10 increase in the rate of contribution will provide a
$3.55 increase in Benefit Level.” The Agency routinely sends
such Supplement Quotations to its participant groups on the
eve of collective bargaining—a service it provides as a
courtesy and not as a matter of statutory or contractual
obligation.
The Agency in the past had calculated the Union’s benefits
increases with the understanding that the increases would
apply to “all service,” which includes a participant’s past
service years. The Supplement Quotation, however,
incorrectly assumed, without stating, that the increased
4 Local 6-0682 Int’l Union of Paper v. Nat’l
Industrial Group Pension Plan, et al.
No. 01-2680
benefit would apply to “future service only.” Consequently,
the Supplement Quotation’s prediction of “a $3.55 increase in
Benefit Level” overstated the return the Union members
would receive in exchange for Checker’s $.10 increase in the
rate of contribution.
The parties became aware of the error only after the Union
had negotiated a $.10 per hour increase in the contribution
rate with Checker, at which time it was essentially too late to
change anything. At that point the Agency sent the Union a
letter explaining its error; it apologized, but it did not adjust
the Union members’ benefits to the Supplement Quotation’s
$3.55 level. Later, however, the Agency retroactively
increased the Union members’ benefits three
times—apparently due to the NIGPP’s favorable economic
performance—to a total benefit level that exceeded even the
inflated level provided in the Supplement Quotation.
The Union filed a negligence suit against the Agency and
NIGPP in district court, seeking to recover on behalf of its
members the difference between the benefits predicted in the
Supplement Quotation and the benefits actually received
(without regard to the later increases). The district court
dismissed the case, finding that the Union lacked statutory
standing to bring an ERISA claim, and that its negligence
claim was preempted by ERISA. On appeal the Union bases
jurisdiction for its suit solely on ERISA, because the NIGPP
plan that the Agency administers is an ERISA plan and
because the Union characterizes the suit as one “by and on
behalf of participants to enforce rights and obtain relief under
ERISA.”
We review de novo the district court’s order granting
summary judgment. Bush v. Dictaphone Corp., 161 F.3d
363, 367 (6th Cir. 1999). Viewing all of the evidence in the
light most favorable to the Union as the non-moving party,
we may affirm only if there is no genuine issue of material

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No. 01-2680 Local 6-0682 Int’l Union of Paper v. Nat’l
Industrial Group Pension Plan, et al.
5
1The statute’s standing provision, § 502, lists four categories of
“[p]ersons empowered to bring a civil action”—namely, participants,
beneficiaries, plan fiduciaries, and the Secretary of Lab or— and this list
is exclusive. 29 U.S.C. § 1 132 (a); Whitworth Bros. Storage Co. v. Cen t.
States, Southeast & Southwest Areas Pension Fund, 794 F.2d 221, 228
(6th Cir. 1986) (holding that the court had no jurisdiction under § 502 to
consider the ERISA claim of an employer—a p arty not listed in
§ 502 — because “C ongress intend ed to limit the parties who could
maintain actions pursuant to section 502,” and “section 502 is an
exclusive grant of jurisdiction”). Unions are not included in the § 502 list,
and though a union might qualify as a “fiduciary” under § 502(a)(3), 29
U.S.C. § 113 2(a)(3), see Forys v. United Food & Commercial Worker’s
Int’l Union, 829 F.2d 603 (7th Cir. 1987 ), the Union m akes no effort to
show how it fits this catego ry. See also New Jersey State AFL-CIO v.
New Jersey, 747 F.2d 891, 893 (3d Cir. 19 84) (“It is clear fro m the statute
that labo r unions are neither participants nor beneficiaries”).
2Though, as is mentioned below, ER ISA does allow participants and
beneficiaries to seek equitable relief for certain disclosures, see generally
ERISA § 502(a)(3), 29 U.S.C. § 1132(a)(3), it does not allow money
damages in such cases. See M ertens v. He witt Assocs., 508 U.S. 248, 255
(1993) (holding that compensatory damages are legal damages, and
consequently are not available under § 50 2(a)(3)).
fact and the Agency is entitled to judgment as a matter of law.
Id. at 368.
The Union does not argue that it has statutory standing
under ERISA.1 Even where parties that have statutory
standing are concerned, ERISA itself provides no cause of
action to recover money damages for a third-party
administrator’s negligence.2 The Union proposes that we
overcome both difficulties by creating a federal common law
cause of action for negligence under ERISA, a cause of action
that would allow a party to recover money damages from a
third-party administrator for injuries proximately caused by
the administrator’s negligence in making ERISA-plan-related
6 Local 6-0682 Int’l Union of Paper v. Nat’l
Industrial Group Pension Plan, et al.
No. 01-2680
3Though the parties discuss preemption, strictly speaking preemption
is not an issue here because the Union brings its negligence action under
E RIS A— which provides no such cause of action— and not und er state
law. Hence the question is not whether E RISA preempts wha t would
otherwise be a valid state law cause of action, but whether the Union has
a cause of action under federal law.
disclosures.3 Further, in light of the facts of this case it is
evident that the Union would have this cause of action extend
to negligence in disclosures that are offered gratuitously, out
of no obligation either under contract or under ERISA.
Federal courts do have a certain latitude to create federal
common law under ERISA. See Firestone Tire & Rubber Co.
v. Bruch, 489 U.S. 101, 110 (1989) (noting that “we have held
that courts are to develop a ‘federal common law of rights and
obligations under ERISA-regulated plans’”) (quoting Pilot
Life Ins. Co. v. Dedeaux, 481 U.S. 41, 56 (1987)). This
authority, however, is limited to instances in which ERISA is
“silent or ambiguous,” Muse v. IBM, 103 F.3d 490, 495 (6th
Cir. 1996), where there is an “awkward gap in the statutory
scheme,” Tassinare v. Am. Nat’l Ins. Co., 32 F.3d 220, 225
(6th Cir. 1994), or where it may “be said that federal common
law is essential to the promotion of fundamental ERISA
policies.” Id.
The present case is not such an instance. First, the problem
is not that ERISA is silent on the issue of misleading or
inaccurate disclosures; rather, it allows recovery for such
disclosures under some circumstances, but not under those
presented here. See, e.g., Drennan v. Gen. Motors Corp., 977
F.2d 246, 251 (6th Cir. 1992) (“Misleading communications
to plan participants ‘regarding plan administration (for
example, eligibility under a plan, the extent of benefits under
a plan) will support a claim for a breach of fiduciary duty.’”)
(quoting Berlin v. Mich. Bell Tel. Co., 858 F.2d 1154, 1163
(6th Cir. 1988)); Krohn v. Huron Mem. Hosp., 173 F.3d 542,
547 (6th Cir. 1999) (“[A] fiduciary breaches its duties by

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No. 01-2680 Local 6-0682 Int’l Union of Paper v. Nat’l
Industrial Group Pension Plan, et al.
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materially misleading plan participants, regardless of whether
the fiduciary’s statements or omissions were made
negligently or intentionally.”). Second, though ERISA’s
failure to provide a remedy for the Union might conceivably
be described as a “gap in the statutory scheme,” the Union has
given us no reason to believe that the gap is “awkward,” or
that creation of the Union’s proposed cause of action is
“essential to the promotion of fundamental ERISA policies.”
Tassinare, 32 F.3d at 225.
Consequently, we find the Union’s claims without merit,
and we AFFIRM the judgment of the district court.

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