Abraham Fotta, individually and on behalf of all other persons similarly situated v. Trustees of the United Mine Workers of America, Health

PRECEDENTIAL
Filed February 11, 2003
UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT
No. 01-2097
ABRAHAM FOTTA, individually and
on behalf of all other persons
similarly situated,
Appellant
v.
TRUSTEES OF THE UNITED MINE WORKERS
OF AMERICA, HEALTH AND RETIREMENT FUND
OF 1974; MICHAEL HOLLAND; DONALD
PIERCE; ELLIOT SEGAL;
JOSEPH STAHL, II
Appeal from the United States District Court
for the Western District of Pennsylvania
(D.C. Civil Action No. 97-cv-00566)
District Judge: Honorable William L. Standish
Submitted Under Third Circuit LAR 34.1(a)
January 14, 2002
Before: ALITO and ROTH, Circuit Judges
SCHWARZER,* District Judge
(Opinion filed: February 11, 2003)
_________________________________________________________________
* Honorable William W Schwarzer, Senior District Court Judge for the
Northern District of California, sitting by designation.
OPINION OF THE COURT
ROTH, Circuit Judge:
Appellant, Abraham Fotta, is a disabled miner who had
to wait nine years to receive his disability payments. He has
now received all the delayed payments but has sued his
pension fund, claiming that S 502(a)(3)(B) of the Employee
Retirement Income Security Act of 1974 (ERISA) entitles
him to the interest that would have accumulated on his
delayed payments. After a bench trial, the District Court
held that Fotta was not entitled to interest because he
failed to prove his disability payments were withheld
wrongfully. Fotta raises three issues on appeal. First, did
the District Court err by requiring Fotta to prove that the
withholding of his disability payments was wrongful?
Second, if so, did the District Court err when it found that
his payments were not wrongfully withheld? Finally, did the
District err in denying class certification to Fotta to

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represent a class of miners who have received delayed
disability payments? After careful consideration, we believe
that the District Court correctly answered each of these
questions and we will affirm its judgment.
I. Factual and Procedural History
On July 23, 1984, Abraham Fotta, while on his job for
the United States Steel Mining Company, Inc., stepped off
a motor, twisting his ankle and, as has ultimately been
determined, aggravating a pre-existing condition. On the
day of the injury, Fotta worked through his shift. He told
his foreman about the injury, but no accident report was
filed. Fotta waited until the following day to visit his
employer’s physician, Dr. Eisley. Dr. Eisley found that Fotta
had a synovial cyst (a type of tumor) in his ankle and
referred him to Dr. Mitchell, an orthopedic surgeon. Dr.
Mitchell operated to remove the tumor and at the same
time treated Fotta for a fractured ankle.
Following the surgery, Fotta’s 18 year litigation odyssey
began. He first filed a claim for Workmen’s Compensation
2
benefits, which was denied on May 10, 1985. The
Workmen’s Compensation Referee found that Fotta had
failed to prove that the mine accident caused his disability.
Based on a report from Dr. Mitchell, the Referee concluded
that Fotta’s disability was caused by his pre-existing
villonodular synovitis (recurring ankle cysts), not his
accident. Fotta twice appealed this decision, and the
Workmen’s Compensation Appeals Board twice affirmed the
Referee. Fotta then appealed to the Pennsylvania Supreme
Court.
On July 15, 1985, when his second appeal to the
Workmen’s Compensation Appeal Board was pending, Fotta
received some good news. The Social Security
Administration had awarded him disability benefits on the
basis of a malignant synovial tumor of the right ankle.
Fotta was then able to embark on the next phase of his
search for disability benefits. On February 7, 1986, he
submitted an application for disability benefits to
defendant, the United Mine Workers of America Health and
Retirement Fund of 1974. The Fund provides disability
payments when an applicant proves that (1) he was
involved in a mine accident, (2) he received a Social
Security Disability Insurance award, (3) he is an employee
covered by the plan, and (4) the mine accident caused the
disability. See Section 615.1.12 of the Fund’s Pension
Processing Manual. When the cause of the disability is not
obvious, a mine accident that "substantially aggravates" a
pre-existing condition can fulfill the fourth condition.
The Fund gathered information concerning Fotta’s
application. It received records from the Social Security
Administration, from Fotta’s employer, and from Drs.
Mitchell and Eisley. The Fund also reviewed records of the

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Workmen’s Compensation proceedings. After considering
this information, the Fund informed Fotta, in a letter dated
November 18, 1987, that his application had been denied
because he did not "establish that [his] disability was
caused by a mine accident." The letter also stated that
Fotta could call if he had any questions and that, if he was
not satisfied that the decision was correct, he could request
a hearing within 90 days. Fotta did not take any action in
response to this denial of benefits.
3
Fotta did, however, persist in his Workmen’s
Compensation appeals. After almost six years of litigation,
the Pennsylvania Supreme Court rewarded Fotta’s
perseverance. On June 1, 1993, the court reversed the
Workmen’s Compensation Appeal Board and granted Fotta
Workmen’s Compensation benefits.
Buoyed by this success, Fotta returned to his claim for
disability benefits from the Fund. On June 15, 1993, he
sent the Fund a copy of the Pennsylvania Supreme Court’s
decision. The opinion mentioned a letter from Dr. Mitchell
that the Fund had not previously seen. The letter stated
that "the majority of [Fotta’s] disability is due to the
pigmented villonodular synovitis but the alleged traumatic
ankle injury also is contributing to his incomplete
recovery." Fotta v. Workmen’s Compensation Appeal Board,
626 A.2d 1144, 1146 (Pa. 1993). Despite Fotta’s failure to
appeal the November 18, 1987, denial of disability benefits,
the Fund on November 1, 1993, decided in light of the new
information that Fotta had established that a mine accident
substantially aggravated his pre-existing ankle cysts and
awarded disability benefits to Fotta. The Fund initially
awarded him $18,835 in retroactive payments. After
adjusting the starting date, the Fund paid him an
additional $1,965.
Fotta, however, was not satisfied. He asked the Fund for
interest on the retroactive payments. When the Fund
declined to pay him interest, Fotta sued the Fund and the
individual defendants in the United States District Court
for the Western District of Pennsylvania. He alleged that by
failing to pay him interest on his retroactive payments, the
Fund violated ERISA requirements promulgated at 29
U.S.C. S 1001 et seq.
The District Court originally dismissed his law suit for
failure to state a claim under ERISA. Fotta appealed. In
Fotta v. Trustees of the United Mine Workers of America
Health & Retirement Fund of 1974, 165 F.3d 209 (3rd Cir.
1998) (Fotta I), we reversed and remanded the case to the
District Court. We held that S 502(a)(3)(B), which empowers
courts to award appropriate equitable relief to redress
violations of ERISA or ERISA regulated plans, provides a
cause of action for interest on delayed pension benefits
4

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even when the beneficiary acquired the delayed benefits
without resorting to litigation.
On remand, the District Court held a bench trial and
concluded that Fotta was not entitled to relief because he
had failed to show that the delay in paying his disability
was due to any wrongful conduct by the Fund. The District
Court also denied Fotta’s request for class certification
because he had failed to demonstrate that the proposed
class met the commonality requirement of Federal Rule of
Civil Procedure 23(a). Fotta appealed.
II. Jurisdiction and Standard of Review
Because Fotta sued under the Employee Retirement
Income Security Act of 1974, 29 U.S.C. S 1001 et seq, the
District Court had federal question jurisdiction under 28
U.S.C. S 1331. We have appellate jurisdiction under 28
U.S.C. S 1291.
The decision to award pre-judgment interest is within the
discretion of the District Court, see Fotta, 165 F.3d at 214,
but we exercise plenary review over its interpretation and
application of legal precedent. Holmes v. Pension Plan of
Bethlehem Steel Corp., 213 F.3d 124 (3rd Cir. 2000). We
review the District Court’s decision to deny class
certification for an abuse of discretion. Id. at 136
III. Discussion
A. The Claim for Interest
Fotta contends that the District Court used the wrong
standard to evaluate his claim for interest. He claims in
addition that, even if the District Court had applied the
correct standard, it erred in finding that he failed to satisfy
it.
1. Must Fotta prove that the Fund acted wrongfully?
Fotta’s primary claim is that the District Court
misapplied S 502(a)(3)(B), using the wrong standard to
evaluate his claim for interest. The District Court held that
the Fund is liable for interest only if Fotta can show that
5
the Fund "wrongfully delayed" his disability benefits. Fotta
contends that he need not prove the Fund acted wrongfully.
He asserts that S 502(a)(3)(B) makes the Fund
presumptively liable for interest whenever ERISA benefits
are delayed, regardless of the reason.
Section 502(a)(3)(B) allows a beneficiary of an ERISA plan
to sue for "other appropriate equitable relief," which we
have held includes interest on delayed payments. See, e.g.,
Anthuis v. Colt Industries Operating Corp., 971 F.2d 999,
1010 (3d Cir. 1992); Fotta I, 165 F.3d at 209. Section

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502(a)(3)(B) does not, however, allow a beneficiary to sue for
equitable relief for any reason, but only "(i) to redress
[violations of ERISA or the terms of an ERISA plan] or (ii) to
enforce any provisions of this subchapter or the terms of
the plan." 29 U.S.C. S 1132(a)(3)(B). As we emphasized in
Fotta I, S 502(a)(3)(B) "does not . . . authorize appropriate
equitable relief at large, but only ‘appropriate equitable
relief ’ for the purpose of ‘redress[ing any] violations or
enforc[ing] any provisions of ERISA or an ERISA plan.’ "
Fotta I, 165 F.3d at 213 (citing Mertens v. Hewitt
Associates, 508 U.S. 248, 253 (1993)). Accordingly, an
ERISA beneficiary who seeks interest on delayed payments
must first prove that those payments were withheld in
violation of his ERISA plan or of ERISA itself. See Jackson
v. Fotris Benefits Ins. Co., 245 F.3d 748, 749-50 (8th Cir.
2001) (requiring "a showing that the plan was breached
before interest on back payments may be awarded under
[S 502(a)(3)(B)]."); Holmes, 213 F.3d at 128 (noting that
"ERISA permits actions to recover interest on wrongly
withheld benefits"); Clair v. Harris Trust & Sav. Bank, 190
F.3d 495, 497-99 (7th Cir. 1999) (holding that ERISA
"authorizes suit to redress plan violations," but concluding
there was no breach of ERISA or terms of the plan);
Anthuis, 971 F.2d at 1007-08 (upholding an award of
prejudgment interest when the plaintiff ’s severance benefits
were withheld in violation of an ERISA plan). We conclude
that it is clear from the case law that unless a beneficiary
proves his payments were wrongfully withheld, he is not
entitled to interest.
Fotta argues that our opinion in Fotta I contradicts this
rule. Fotta cites a single sentence from that opinion: "We
6
now make explicit that interest is presumptively
appropriate when ERISA benefits have been delayed." Fotta
I at 214. From this, he argues that interest is presumptively
appropriate whenever benefits are delayed whether they are
delayed wrongfully or not. There is no reason, however, to
believe that Fotta I made liability to pay interest
independent of wrongdoing.
In fact, Fotta I did not even address the issue of liability.
It determined who has a cause of action under
S 502(a)(3)(B). Before Fotta I, only an ERISA beneficiary who
had brought a legal action to recover wrongfully withheld
benefits could sue for interest under S 503(a)(3)(B). See,
e.g., Anthuis, 971 F.2d at 1010. In Fotta I, we were asked
to decide whether a beneficiary who recovered wrongfully
withheld benefits without resorting to litigation could sue
under S 502(a)(3)(B). Fotta I, 165 F.3d at 211. ("This appeal
raises an issue of first impression for this court: whether a
beneficiary who has been able to receive his her benefits
due under an ERISA plan only after considerable delay, but
without resorting to litigation to recover that payment, has
a cause of action [under S 503(a)(3)(B)].") We determined
that S 503(a)(3)(B) did provide a cause of action for such
plaintiffs. We did not, however, address the standard of

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liability that would trigger an obligation to pay interest.
Because Fotta I did not change the standard of liability,
the District Court applied the correct standard: a
beneficiary is presumptively entitled to interest on his
delayed benefits only if those benefits were wrongfully
withheld or wrongfully delayed, that is, only if they were
withheld or delayed in violation of ERISA or an ERISA plan.
2. Did the Fund Act Wrongfully?
Assuming for the sake of argument that the District
Court applied the correct standard, Fotta advances an
alternative agument. He urges us to reverse the District
Court on the basis that the Fund did wrongfully delay his
benefits.
In order to prove the Fund acted wrongfully, Fotta must
meet a high standard. The Fund’s plan grants the Fund
discretion in making eligibility determinations, giving it in
7
Article VIII.A, B(a) "full and final determination as to all
issues concerning eligibility for benefits." Thus, the Fund’s
eligibility determinations are wrongful only if they are
arbitrary and capricious. See Moats v. UMWA Health &
Retirement Funds, 981 F.2d 685, 687 (3rd Cir. 1992).
The Fund provides disability benefits only when the
applicant has carried his burden of proving that a mine
accident either directly caused his disability or caused his
disability by substantially aggravating a pre-existing
condition. When the Fund rejected Fotta’s claim for
disability benefits on November 18, 1987, it concluded that
it had insufficient evidence of a mine accident to conclude
that a mine accident had caused Fotta’s disability by
substantially aggravating a pre-existing condition.
Fotta challenges this holding. Fotta claims that the Fund
acted arbitrarily in several ways. He claims that the Fund
failed to inform him of the true reason for its denial. Fotta
received the November 18, 1987, letter, however, that
informed him he did not qualify for benefits, stating "Your
application was denied because: You have not established
that your disability was caused by a mine accident." This
same letter informed Fotta that, if he was not satisfied that
this decision was correct, he could request a hearing.
Fotta next claims that the Fund acted arbitrarily and
capriciously by failing to ask him for additional medical
data or by failing to get more medical data itself. The Fund,
however, was diligent in collecting data. It requested
medical information from Fotta’s employer and examined
medical reports from Drs. Mitchell and Eisley. It also
examined the records of the Social Security Administration
and the findings of the Workmen’s Compensation Referee.
The Fund’s decision to rest on this information would not
appear to be arbitrary and capricious.

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Fotta also claims the Fund acted arbitrarily and
capriciously because it concluded there was no mine
accident when it was the fault of Fotta’s employer, not of
Fotta, that no accident report had been filed. The Fund’s
Pension Processing Manual, however, permits the
establishment of the occurrence of a mine accident by an
accident report, an employer statement or Workmen’s
8
Compensation records. Fotta could have demonstrated the
occurrence of the mine accident without an "accident
report" per se, as he ultimately did in the Workmen’s
Compensation proceedings. The employer’s failure to file an
accident report did not, therefore, preclude Fotta from
receiving benefits.
Fotta finally alleges that the Fund acted arbitrarily and
capriciously by "acknowled[ing] the existence of a causal
link between some incident and the injury, contrary to the
worker’s compensation finding." As support for this
allegation, Fotta points to a December 30, 1996, note of a
Clinical Consultant from the Fund’s Central Office that,
"Based on Mitchell’s report I accept that there was an ankle
injury and that it aggravated a pre-existing tumor." Fotta
does not go on, however, to cite the remainder of the
paragraph which indicates that the consultant was not
convinced how the ankle was injured or where. This report
is not, therefore, inconsistent with the November 18, 1987,
denial of benefits on the basis of lack of evidence that a
mine accident caused the disability.
We also note a second reason to uphold the denial of
interest. Fotta did not request a hearing to challenge the
November 18, 1987, denial of benefits and he waited six
years before he presented a renewed request to the Fund
for benefits. Section 502(a)(3)(B) allows a plan beneficiary to
obtain "appropriate equitable relief " when his benefits have
been wrongfully withheld, and, although "interest is
presumptively appropriate," Fotta I at 214, it remains an
equitable remedy subject to the usual conditions. One of
the reasons for denying an equitable remedy is delay by the
claimant. As the Eighth Circuit has stated, "prejudgment
interest should ordinarily be granted unless exceptional or
unusual circumstances exist making the award of interest
inequitable. Such circumstances may include bad faith or
dilatoriness by the claimant." Stroh Container Co. v. Delphi
Industries, Inc. 783 F2d 743, 751 (8th Cir. 1986). We
conclude from the facts of this case that Fotta’s delay in
seeking his benefits would make an award of interest
inequitable.
B. Denial of Class Certification
Fotta also contends that the District Court abused its
discretion by denying his motion for class certification on
9

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the ground that the putative class did not meet the
"commonality" requirement of Federal Rule of Civil
Procedure 23. Fotta proposed a class of more than 116,000
miners who are receiving or have received disability benefits
following some kind of administrative delay. He argues that,
because all the members of the class are presumptively
entitled to interest, they share a common question of
whether interest is available and what the correct rate of
interest should be. Because, however, the putative
members of the class are not entitled to interest if their
benefits were not wrongfully delayed, they do not share
common issues of law or fact and thus do not meet the
requirements of Rule 23.
A district court can only certify a proposed class if the
class meets all four requirements of Rule 23(a) of the
Federal Rules of Civil Procedure: numerosity, commonality,
typicality, and adequacy of representation. See F.R.C.P.
23(a); In re Prudential Ins. Co. of America Sales Litig., 148
F.3d 283, 308-09 (3rd Cir. 1998). Our holding that an
ERISA beneficiary is entitled to interest only if the benefits
were wrongfully withheld or wrongfully delayed requires us
to conclude that the putative class members share no
common issues of law or fact. To decide whether each
putative class member would be entitled to interest, the
District Court would have to determine whether the Fund
wrongfully withheld or wrongfully delayed payment for each
class member. The District Court would also have to
determine the remedy for each class member, an individual
determination. As we stated in Holmes v. Pension Plan of
Bethlehem Steel Corp., 213 F.3d 124 (3rd Cir. 2000), a
belief that "the interest entitlement of every class member
can be calculated using a single, objective formula . . .
ignores [Fotta I’s] clear holding that interest on delayed
ERISA benefits is an equitable remedy dependent upon the
individual facts of each claim." Id. at 137. Because both
liability and the appropriate remedy must be determined for
each plaintiff, no common issues of law or fact exist. We
cannot, therefore, say that the District Court abused its
discretion in denying class certification.
IV. Conclusion
For the reasons stated above, we will affirm the judgment
of the District Court.
10
SCHWARZER, Senior District Judge, concurring:
I concur in the result reached by the majority but write
separately because I arrive at that result by a substantially
different route. In Fotta v. Trustees of the United Mine
Workers of America, Health and Retirement Fund, 165 F.3d
209 (3d Cir. 1998) (Fotta I), this court held that a fund
beneficiary may bring an action under the Employee
Retirement Income Security Act, 29 U.S.C. SS 1001--1461

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(ERISA), to recover interest from the plan on benefits paid
after some delay. Specifically, we held that ERISA
S 502(a)(3)(B), 29 U.S.C. 1132(a)(3)(B), which permits a
beneficiary "to obtain other appropriate equitable relief (i) to
redress [violations of ERISA or of the terms of an ERISA
plan] or (ii) to enforce any provisions of this subchapter or
the terms of the plan[,]" provides a cause of action for a
beneficiary to recover interest on benefit payments.
The District Court held, and the majority agrees, that to
recover interest on delayed payments a beneficiary must
prove that benefits were withheld in violation of his ERISA
plan or of ERISA itself, i.e., that the denial was arbitrary
and capricious. The majority finds support for its position
in Fotta I, which states, quoting from Mertens v. Hewitt
Associates, 508 U.S. 248, 253 (1993), that S 502(a)(3)(B)
"does not . . . authorize appropriate equitable relief at large,
but only ‘appropriate equitable relief ’ for the purpose of
redress[ing any] violations or enforc[ing] any provisions of
ERISA or an ERISA plan." Op. at 6. But the majority fails
to quote this court’s statement immediately following: "As
we noted above, payment for the time value of money, when
appropriate, is an implicit term of the underlying
contractual obligation. Therefore, an award of interest is an
equitable remedy enforcing an ERISA plan provision, albeit
an implied one, within the meaning of section 502(a)(3)(B)."
165 F.3d at 213.
Fotta makes clear, therefore, that the delay in payment of
benefits to which the beneficiary is entitled is a violation of
the plan without more and that recovery of interest enforces
the plan. The Fotta I court repeatedly and consistently
refers to interest to compensate for delay in payment
without ever qualifying that the delay must be shown to
have been wrongful. Analogizing the instant claim to an
11
award of prejudgment interest, it explained that
"prejudgment interest typically is granted to make a
plaintiff whole because the defendant may wrongly benefit
from use of plaintiff ’s money," quoting Schake v. Colt
Industries, 960 F.2d 1187, 1192 n.4 (3d Cir. 1992)
(emphasis added); see also Anthuis v. Colt Industries, 971
F.2d 999, 1009 (3d Cir. 1992).
Thus, wrongfulness is an element of the beneficiary’s
claim only in the sense that the plan’s withholding of his
money is wrongful in unjustly enriching the plan and
depriving the beneficiary. That the court did not intend to
condition the cause of action to recover interest on delayed
benefits upon proof of a further violation of the plan or of
ERISA is confirmed by the court’s statement of its rationale:
The principles justifying prejudgment interest also
justify an award of interest where benefits are delayed
but paid without the beneficiary’s having obtained a
judgment. The concerns animating our decisions in
Schake and Anthuis -- viz., making the claimant whole

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and preventing unjust enrichment -- are not
diminished merely because the plan has paid the
overdue benefits without the claimant having resorted
to litigation to secure payment. A late payment of
benefits effectively deprives the beneficiary of the time
value of his or her money whether or not the
beneficiary secured the overdue benefits through a
judgment as the result of ERISA litigation.
Unjust enrichment principles also apply with equal
force in this setting. To hold that the absence of a
judgment deprives the injured beneficiary of the time
value of his or her money would create a financial
incentive for plans to delay payment and thus retain
interest that rightfully belongs to the beneficiary.
165 F.3d at 212.
The majority also cites Holmes v. Pension Plan of
Bethlehem Steel Corp., 213 F.3d 124 (3d Cir. 2000), which
considered Fotta I, albeit in the context of determining the
appropriate rate of interest to be paid on delayed pension
benefits. The court, in passing and without discussion,
referred to Fotta I as holding that a beneficiary was entitled
12
to interest on "wrongfully withheld benefits" whether
recovered through judicial action or through nonjudicial
means. Id. at 131. In the context of the Fotta I rationale,
however, which the Holmes court adopted, that statement
cannot fairly be interpreted as imposing a condition of proof
of more than unjustified delay. Thus, the court described
"Fotta’s two primary justifications for interest awards: (1)
ensuring full compensation to the plaintiff; and (2)
preventing unjust enrichment," id. at 132, and it noted that
"Fotta did not impose a requirement of culpability [on the
defendant’s part . . .]." Id. at 133.
A case squarely in point not cited by the majority is
Dunnigan v. Metropolitan Life Ins. Co., 277 F.3d 223 (2d Cir.
2002). Dunnigan sued on her own behalf and on behalf of
a class of similarly situated beneficiaries of MetLife’s ERISA
plan to recover interest on benefits paid subsequent to the
date when the participant was entitled to receive payment.
The district court dismissed the action for failure to allege
bad faith on the part of MetLife. The court of appeals
reversed. It held first that interest may be recovered under
S 502(a)(3)(B) "[w]hen benefits are paid only after the date
on which the beneficiary was entitled to receive them . . .
[because] the beneficiary has not received the full value of
what was promised and, to the same degree, the plan has
realized an unjust enrichment (assuming the lateness was
unjustified)." 277 F.2d at 229. It then held that no showing
of bad faith is required, stating:
The opinions of the Third and Seventh Circuits have
recognized that interest can be appropriate, equitable
"make whole" relief under S 502(a)(3)(B), without any

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requirement that a plaintiff allege or prove bad faith on
the part of the defendant. See Clair v. Harris Trust &
Savings Bank, 190 F.3d 495, 498-499 (7th Cir. 1999)
. . . . Fotta v. Trustees of the United Mine Workers, 165
F.3d 209, 213 (3d Cir. 1998). . . .
277 F.3d 229-30. The court went on to state:
Dunnigan’s complaint alleges that she was entitled to
disability benefits, and that the payment of those
benefits was delayed nearly five years . . . . [I]t asserts
that payment of her benefits was unreasonably delayed
13
and made long after she was entitled to receive them.
Such a delay enriches the fiduciary at the expense of
the beneficiary. Unless such a delay is justified, we see
no reason why it does not constitute a breach of
fiduciary duty.
277 F.3d at 230.
The majority also cites Clair v. Harris Trust & Savings
Bank, 190 F.3d 495 (7th Cir. 1999), yet that case lends no
support to its position. While the case was ultimately
decided on the merits of the beneficiaries’ claims, it had
this to say about their entitlement to interest on delayed
ERISA benefits:
The defendants’ position would have the odd
implication that if the settlement date were June 30,
1990, and the bank did not cut a check to the retiring
employee until July 1, 1991, the employee would have
no redress, since he would have received his full plan
benefits, albeit ten months after the last date on which
he was entitled to receive them under the terms of the
plan. The violation of the plan would be plain , but there
would be no remedy.
190 F.3d at 498 (emphasis added).
Only one case appears to be in agreement with the
majority. In Jackson v. Fortis Benefits Ins. Co. , 245 F.3d
748, 750 (8th Cir. 2001), the court affirmed the denial of
interest on delayed benefit payments, holding that"a
showing [is required] that the plan was breached before
interest on the back payments may be awarded under
ERISA." It reached that decision on the authority of Clair,
Holmes and Fotta I and Dependahl v. Falstaff Brewing
Corp., 653 F.2d 1208 (8th Cir. 1981). As the foregoing
discussion shows, Clair, Holmes and Fotta I do not support
the court’s holding; those cases stand for the proposition
that an unjustified delay in payment of benefits constitutes
a violation of the plan entitling beneficiaries to claim
interest. And in Dependahl, the Eighth Circuit awarded
prejudgment interest, not on the ground that an ERISA
violation had been proved (which was necessarily true since
plaintiffs had obtained judgment) but on equitable grounds.

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Quoting from Hodgson v. American Can Co. , 440 F.2d 916,
14
922 (8th Cir. 1971), the court said, "From the inception of
the discrimination, American Can was unjustly enriched
and the female employees were damaged. During the entire
period American Can has had the use of the money, and
therefore equity and justice requires payment by way of
interest for its use." It continued:
We believe these same considerations should be
followed in an award of prejudgment interest with
regard to an ERISA violation. The former executives
[plaintiffs] have been denied their contractual
severance benefits for a period of approximately four
years before final judgment was rendered. Falstaff has
continued to have the use of this money. Furthermore,
the exact amount of the liability on the plans was never
in issue. The only question was whether the employee
benefit plan was binding in light of the "just cause"
exception. Under these circumstances, an award of
prejudgment interest is necessary in order that the
plan participants obtain "appropriate equitable relief."
29 U.S.C. s 1132(a)(3)(B).
653 F.2d 1218. Upon analysis, therefore, Fortis provides
scant support for the majority’s position.
In sum, the authorities (with the questionable exception
of Fortis) establish that an ERISA beneficiary makes out a
cause of action for interest where payment of benefits has
been unjustifiably delayed without proof that the plan’s
action was wrongful in the sense of arbitrary or capricious.
Prejudgment interest is, however, an equitable remedy.
"[A]warding prejudgment interest is within the district
court’s discretion, ‘given in response to considerations of
fairness and denied when its exaction would be
inequitable." Fotta I, 165 F.3d at 213 (quoting Anthuis v.
Colt Indus. Operating Co., 971 F.2d 999, 1109 (3d Cir.
1992)). The court added that "interest is presumptively
appropriate when ERISA benefits have been delayed." 165
F.3d at 214. To the same effect, see Holmes, 213 F.3d at
131.
Here, the District Court rejected the interest claim
because the delay in payment was due to plaintiff ’s failure
to provide the Fund an accident report, an employer
15
statement or Workmen’s Compensation records to establish
the occurrence of a mine accident as required under the
Fund’s rules. The court found, moreover, that after the
Pennsylvania Supreme Court decision which first
established plaintiff ’s eligibility, the Fund promptly
processed plaintiff ’s claim and made a lump--sum
payment of the benefits he would have received had he

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established eligibility at the time of his original application.
Thus, the Court implicitly found that the delay was
justified. In these circumstances, it could not be said that
the District Court abused its discretion.
A True Copy:
Teste:
Clerk of the United States Court of Appeals
for the Third Circuit
16

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