TERRANCE BERGER and DONALD LAXTON v. AXA NETWORK LLC and EQUITABLE LIFE ASSURANCE SOCIETY OF THE UNITED STATES

In the
United States Court of Appeals
For the Seventh Circuit
____________
No. 05-2495
T ERRANCE B ERGER and D ONALD L AXTON ,
Plaintiffs-Appellants,
v.
AXA N ETWORK LLC and EQUITABLE L IFE
A SSURANCE S OCIETY OF THE U NITED S TATES ,
Defendants-Appellees.
____________
Appeal from the United States District Court
for the Northern District of Illinois, Eastern Division.
No. 03 C 125—Elaine E. Bucklo, Judge.
____________
A RGUED F EBRUARY 14, 2006—DECIDED A UGUST 18, 2006
____________
Before BAUER , R IPPLE and W ILLIAMS , Circuit Judges.
R IPPLE , Circuit Judge. Section 510 of the Employee Retire-
ment Income Security Act (“ERISA”), 29 U.S.C. § 1140,
prevents employers from altering their workers’ employ-
ment status for the purpose of interfering with rights under
an ERISA-qualified benefit plan. The named plaintiffs in
this class action, two insurance salesmen, have invoked
§ 510 against their employers, AXA Network LLC and
the Equitable Life Assurance Society of the United States
(collectively, “AXA”). They allege that AXA intentionally

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2 No. 05-2495
deprived them of benefits by changing the way that insur-
ance salesmen are defined as full-time employees of the
company. The district court awarded summary judgment
to AXA on the ground that the limitation period applicable
to the plaintiffs’ claim had expired; it ruled alternatively
that the plaintiffs’ assertions failed as a matter of law. We
agree with the district court that the plaintiffs’ claim is time-
barred. Accordingly, we affirm the judgment of the district
court on that ground and find it unnecessary to reach the
merits.
I
BACKGROUND
A. Facts
In this de novo review of the district court’s grant of
summary judgment to AXA, we must construe the facts in a
manner that resolves all reasonable inferences in the non-
movant’s favor. See Scaife v. Cook County, 446 F.3d 735, 738-
39 (7th Cir. 2006). Indeed, there is little dispute concerning
the basic facts. The defendants in this action, AXA Network
LLC and the Equitable Life Assurance Society of the United
States—to whom we refer collectively as “AXA”—are
insurance brokerage subsidiaries of the France-based AXA
Financial, Inc. Both subsidiaries are headquartered in New
York City and provide the same pension and welfare
benefits to their employees, agents and managers through
a number of ERISA-qualified plans. AXA maintains a
network of agency offices throughout the United States.
Each satellite office employs a staff of insurance salesmen
who work locally, selling policies to customers in their
region. The lead plaintiffs in this action, Terrance Berger
and Donald Laxton, are Illinois residents who signed on as

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No. 05-2495 3
insurance salesmen with a local AXA office near Chicago in
the early 1980s. After having worked for the company for
three years, each entered into an agreement with AXA
known as the “14th Edition” contract that permitted them to
sell AXA policies as independent contractors.
AXA insurance salesmen, despite being independent
contractors, were able to participate in the company’s
ERISA-qualified plans. To become eligible, they had to be
considered an “employee” under the Internal Revenue
Code, which includes “full-time life insurance sales-
man” within the definition of “employee.” 26 U.S.C.
§ 3121(d)(3)(B). An IRS regulation, in turn, defines a “full-
time insurance salesman” as an individual “whose entire or
principal activity is devoted to the solicitation of life
insurance or annuity contracts, or both, primarily for one
life insurance company.” 26 C.F.R. § 31.3121(d)-1(d)(3)(ii).
This definition is a default; the employer and employee may
choose to redefine “full-time” status via contract, so long as
they act reasonably. See Brian E. Gates, Internal Revenue
Manual § 4.23.5-3 (2005).
At the time that the plaintiffs entered into their 14th
Edition contracts with AXA, the company employed
essentially an “honor system” to qualify salesmen as full-
time agents. Under this system, salesmen were asked, upon
contracting with AXA, to complete a FICA form indicat-
ing whether they intended to devote their principal business
activity to the solicitation of life insurance or annuity
policies for AXA. Assuming they answered affirmatively,
AXA then applied a presumption that agents who had
submitted an appropriate FICA form were statutory em-
ployees. When Mr. Berger and Mr. Laxton entered into 14th
Edition contracts with AXA, both indicated on their FICA
forms that they intended to devote their principal business

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4 No. 05-2495
activity to selling AXA policies. AXA then relied on these
representations to qualify them as full-time agents and to
allow them to participate in AXA’s ERISA-qualified plans.
In the mid-1990s, senior management at AXA began
recommending that the company do away with the “honor
system” and no longer accept a salesman’s representation
that he was committed to selling AXA policies full-time.
Instead, management proposed a new policy that tied
statutory employee status to an objective measure of annual
insurance sales. The idea was that this objective formula
more accurately measured the agents’ intent to devote their
principal business activity to selling AXA policies. The
proposal was adopted, and AXA announced that, starting
January 1, 1999, agents under 14th Edition contracts who
failed to meet a specified sales goal during the preceding
year no longer would be considered statutory employees.
The plaintiffs were alerted to this policy change by letters
from AXA headquarters, dated February 6, 1998. In 1999,
Mr. Berger failed to meet the new annual sales threshold
and lost his status as a statutory employee. Mr. Laxton met
the same fate the following year. As a result, they were no
longer eligible to participate in AXA’s benefit plans. From
1999 to 2004, several thousand other AXA agents lost full-
time status and plan eligibility as a result of the change in
policy.
B. District Court Proceedings
On January 7, 2003, Mr. Berger and Mr. Laxton filed a
three-count complaint alleging that AXA’s 1999 change in
the way it classified agents violated § 510 of ERISA, see 29

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No. 05-2495 5
1 Only the ERISA count survived a motion to dismiss. The other
allegations are not before us in this appeal.
U.S.C. § 1140. 1 In 2004, the district court granted the plain-
tiffs’ motion for certification of a class consisting of the
thousands of other insurance agents who had been reclassi-
fied by AXA and denied eligibility for benefits.
AXA then moved for summary judgment, asking the court
to dismiss the class action on the ground that the plaintiffs’
claims were time-barred or, alternatively, on the ground
that they failed as a matter of law. The district court granted
the motion. Because § 510 lacks a statute of limitations, the
court borrowed a limitations period from the law of New
York, the state that, in its view, had the most significant
relationship to the dispute. The court determined that the
most analogous claim for relief under New York law is a
claim for retaliatory discharge under the state’s workers’
compensation law; New York law bars such claims after two
years, see N.Y. Work. Comp. Law § 120. The court then
rejected the plaintiffs’ theory that each yearly denial of full-
time status started the limitations clock anew. The court
held that the plaintiffs’ claims accrued in 1998, when they
first learned of AXA’s decision to change the way it classi-
fied insurance salesmen, or, at the latest, when the policy
became effective in January 1999. In either case, the plain-
tiffs’ failure to institute this action until January 7, 2003,
barred their claim under the applicable two-year statute of
limitations.
The district court held, alternatively, that the plaintiffs’
grievance under § 510 failed as a matter of law. That section,
which is designed to protect the employment relationship
from being changed in ways intended to deny benefits, did
not, according to the court, apply to the present dispute. In

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6 No. 05-2495
2 For instance, claims under Part 4 of ERISA, the sections
governing plan fiduciaries, expire within six years or three years,
depending on when the plaintiff knows or should know of the
fiduciary’s breach. See 29 U.S.C. § 1113. Similarly, actions under
Subtitle E, the special provisions for multiemployer plans, id.
§§ 1381-1453, must be brought within six years from when they
arose or three years from when the underlying actions were
(continued...)
the court’s view, the employment relationship between
AXA and its salesmen had not been altered by the 1999
change in policy. What had changed was that, instead of
taking an agent’s word that he was committed to selling
AXA policies full-time, AXA had chosen to employ a
concrete sales calculus in order to make the full-time
determination objective. This change, the district court
concluded, did not offend § 510.
II
DISCUSSION
We first address whether the district court correctly
determined the appropriate limitations period for an action
under § 510 of ERISA, see 29 U.S.C. § 1140. In examining this
problem, we must confront several difficult methodological
issues that have “spawned a vast amount of litigation” and
“uncertainty for both plaintiffs and defendants.” Jones v.
R.R. Donnelley & Sons Co., 541 U.S. 369, 377, 379 (2004).
A.
In enacting ERISA, Congress supplied an express limita-
tions period for several parts of the statute; 2 it did not,

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No. 05-2495 7
2 (...continued)
discovered. However, § 510, id. § 1140, was codified in Part 5 of
ERISA, “Administration and Enforcement,” to which the statute
of limitations in § 1113 expressly does not apply.
3 See Tolle v. Carroll Touch, Inc., 977 F.2d 1129, 1137 (7th Cir. 1992)
(“Congress did not provide a statute of limitations for claims
premised upon Section 510 of ERISA.”). We note, additionally,
that it is not uncommon for Congress to omit limitations periods
from federal statutes. See, e.g., Goodman v. Lukens Steel Co., 482
U.S. 656, 660-61 (1987) (discussing the omission in 42 U.S.C. §
1981); Wilson v. Garcia, 471 U.S. 261, 266-67 (1985) (discussing the
omission in 42 U.S.C. § 1983).
4 Section 1658(a) was a response to the host of “practical
problems” that arise from the practice of borrowing state statutes
of limitations to fill gaps in federal statutes. As the House Report
to § 1658(a) described, reliance on analogous state statutes
obligates judges and lawyers to determine the most analo-
gous state law claim; it imposes uncertainty on litigants;
reliance on varying state laws results in undesirable variance
among the federal courts and disrupts the development of
federal doctrine on the suspension of limitation periods.
H.R. Rep. No. 101-734, at 24 (1990), as reprinted in 1990
U.S.C.C.A.N. 6860, 6870.
however, provide one for actions grounded in § 510. 3
Section 510 also was enacted too early to permit us to apply
the default four-year federal limitations period contained in
28 U.S.C. § 1658(a). That statute functions as a catch-all
limitations period for federal causes of action that do not
have their own limitations periods. 4 The catch-all, however,
applies only to those causes of action created after 1990.
Although the Supreme Court has held that, under certain
circumstances, a new amendment to an older federal statute

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8 No. 05-2495
can trigger § 1658(a), see Jones, 541 U.S. at 382, § 510 of
ERISA has not been amended since its original enactment in
1974.
Because Congress has failed to provide any statutory
direction, our inquiry must be guided by principles of
federal common law. The basic approach is well-settled.
When Congress fails to provide a statute of limitations for
a federal claim and § 1658(a) is not applicable, federal courts
must borrow the most analogous statute of limitations from
state law. See Reed v. United Transp. Union, 488 U.S. 319, 323
(1989); Teumer v. Gen. Motors Corp., 34 F.3d 542, 546-47 (7th
Cir. 1994). The Supreme Court has recognized a limited
exception to this general rule:
We decline to borrow a state statute of limitations only
when a rule from elsewhere in federal law clearly
provides a closer analogy than available state statutes,
and when the federal policies at stake and the
practicalities of litigation make that rule a significantly
more appropriate vehicle for interstitial lawmaking.
Reed, 488 U.S. at 324 (internal quotation marks omitted). The
Supreme Court also has made clear, however, that this
exception is “a closely circumscribed[,] . . . narrow exception
to the general rule,” id. at 324, and that state law remains the
“lender of first resort,” N. Star Steel Co. v. Thomas, 515 U.S.
29, 34 (1995). In any event, borrowing directly from federal
law in this case is foreclosed by our prior cases. See, e.g.,
Teumer, 34 F.3d at 546-47 (applying a state limitations period
to a claim under § 510); Tolle v. Carroll Touch, Inc., 977 F.2d
1129, 1137 (7th Cir. 1992) (same).
In Teumer, we held that “the five-year statute of limita-
tions governing retaliatory discharge claims in Illinois
should apply to all § 510 actions in which Illinois limitations

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No. 05-2495 9
5 See Teumer v. Gen. Motors Corp., 34 F.3d 542, 547 (7th Cir. 1994)
(“Because Illinois is both the forum state and the state in
which the significant events of this case took place, we will
refer to its law without resolving the difficult question of
what is the proper choice-of-law rule when selecting state
limitation periods for federal claims.”).
6 We do not believe that the Supreme Court decided this issue by
implication in North Star Steel Co. v. Thomas, 515 U.S. 29 (1995),
although one of our sister circuits appears to have thought
otherwise, see Int’l Union, United Plant Guard Workers of America
v. Johnson Controls World Servs., 199 F.3d 903, 905 (11th Cir. 1996).
(continued...)
law is to be borrowed.” Teumer, 34 F.3d at 550. However, in
Teumer, we did not have to choose between the law of
Illinois and the law of another state in borrowing a state
statute of limitations. 5 In the present case, by contrast, the
parties dispute whether Illinois or New York law ought to
supply the limitations period. Illinois is the forum state and
home to the named plaintiffs in this class action. New York,
on the other hand, is the location of AXA’s headquarters,
where the plan is administered and where the decisions at
issue in this case were made. It is also the state whose
substantive law is, by the terms of the plan, applicable to
disputes arising under that contract.
In order to determine whether Illinois or New York law
ought to supply the limitations period, we first must
identify a choice of law rule or methodology that will permit
our determination to be a principled one. The Supreme
Court has not set forth a definitive choice of law formula to
govern the selection of a limitations period. See Auto Workers
v. Hoosier Cardinal Corp., 383 U.S. 696, 705 n.8 (1966) (reserv-
ing the question). 6 However, its rulings on related issues

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10 No. 05-2495
6 (...continued)
As recently as last Term, the Supreme Court recognized that this
issue has yet to be resolved. See Jones v. R.R. Donnelley & Sons Co.,
541 U.S. 369, 378 (2004) (“The practice of borrowing state statutes
of limitation also forced courts to address the frequently present
problem of a conflict of laws in determining which State statute
was controlling, the law of the forum or that of the situs of the
injury.” (internal quotation marks and alterations omitted)).
7 See, e.g., Wang Labs., Inc. v. Kagan, 990 F.2d 1126, 1128 (9th Cir.
1993) (“We decide as a matter of federal law which state
statute of limitations is appropriate.”); Gluck v. Unisys Corp.,
960 F.2d 1168, 1179 (3d Cir. 1992) (“If a statute of limitations of a
state other than the forum state were implicated in the litigation
of a federal claim, then federal, not state, choice of law principles
would govern.”); Champion Int’l Corp. v. United Paperworkers Int’l
Union, 779 F.2d 328, 332-34 (6th Cir. 1985) (holding that federal
law, rather than a state borrowing statute, should govern the
choice between the forum state’s statute of limitations and that of
another state in an action under the federal labor laws).
and the experience of our sister circuits provide helpful
guidance.
B.
We begin our journey with a principle upon which there
is no real disagreement: In fashioning a choice of law rule to
govern our quest for the most appropriate state limitations
period, our task, when the underlying claim is a federal
claim, is to fashion a federal choice of law rule. 7 This princi-
ple is really nothing more than a corollary principle to the
more general maxim that, when state law is borrowed in a
federal question suit, the choice of “which [state] law to
select is itself a question of federal law.” Resolution Trust

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No. 05-2495 11
8 Subsequently, the primary holding of Chapman was over-
ruled by the Supreme Court in Atherton v. FDIC, 519 U.S. 213
(1997). We later recognized that Chapman’s “ruling on
choice-of-law, however, presumably remains controlling prec-
edent.” FDIC v. Wabick, 335 F.3d 620, 625 n.2 (7th Cir. 2003).
Corp. v. Chapman, 29 F.3d 1120, 1124 (7th Cir. 1994) (citation
omitted) (emphasis added). In Chapman, we explained:
What law Illinois courts would choose is . . . irrelevant.
This is not a diversity case, where Erie would require
the forum court to apply the whole law of the state,
including its choice of law principles. Klaxon Co. v.
Stentor Electric Manufacturing Co., 313 U.S. 487, 61 S. Ct.
1020, 85 L.Ed. 1477 (1941). It is a suit by a federal agency
invoking federal jurisdiction per 12 U.S.C. § 1441a(l)(1),
which says that suits to which the [Resolution Trust
Corp.] is a party “shall be deemed to arise under the
laws of the United States”. Federal law may well look to
state law for substantive principles, see United States v.
Kimbell Foods, Inc., 440 U.S. 715, 727-29, 99 S. Ct. 1448, 59
L.Ed.2d 711 (1979), but which law to select is itself a
question of federal law, as Kimbell Foods and O’Melveny
& Myers [v. FDIC, 512 U.S. 79, 114 S. Ct. 2048, 129
L.Ed.2d 67 (1994),] show. The Supreme Court in
O’Melveny & Myers did not ask what law a state court
would have selected; it approached the question as one
for independent decision.
Id.8
This general principle is easily applicable to the borrow-
ing of a state statute of limitations to fill a gap left open in a
federal statute. Unlike when our jurisdiction is based on
diversity of citizenship, the exercise of federal question

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12 No. 05-2495
9 See infra note 14.
jurisdiction does not implicate concerns of federalism and
interstate comity. “State legislatures do not devise their
limitations periods with national interests in mind.” Reed,
488 U.S. at 324 (internal quotation marks omitted); Gluck v.
Unisys Corp., 960 F.2d 1168, 1179 n.8 (3d Cir. 1992) (“A
state court or legislature does not necessarily seek to further
or even consider federal laws when it develops its choice of
law provisions.”). In federal question cases, we must ensure
only that the borrowed limitations period is compatible with
the purpose of the federal statute. In view of this general
principle, we now must evaluate several possible methodol-
ogies for determining which state’s law should apply.
One possible approach would be simply to choose, in
every case, the forum state’s law as the source of the
applicable limitations period. The prime advantage of this
approach is its simplicity; neither the court nor the parties
remain in doubt concerning which state’s law ought to
apply. Certainly, predictability and ease of administration
are factors long recognized in the fashioning of any choice
of law tool. See Restatement (Second) of Conflict of Laws
§ 6(2). 9
This approach is not without disadvantages, however. The
selected limitations period, drawn in rote fashion from the
forum state’s law, may have only a limited relationship to
the federal cause of action and its underlying policies. When
a state, either by statute or by case law, makes a certain
limitations period applicable to a particular state cause of
action, a conscious decision is made that the public policy of
the state ought to permit suit on that state-created cause of
action only for the length of time permitted by that limita-
tions period. Whatever the reasons for the state’s policy on

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No. 05-2495 13
how long a state cause of action ought to remain alive, those
policy concerns may not have much relevance to the
congressional policies that animate a federal cause of action
in the district court under the court’s federal question
jurisdiction. See Reed, 488 U.S. at 324; Gluck, 960 F.2d at 1179
n.8.
The force of this criticism partially is assuaged, no doubt,
by the fact that the state limitations period is linked to a
state cause of action that at least somewhat resembles the
federal cause of action. Here, for instance, the state limita-
tions period typically borrowed in § 510 actions is the one
that applies to the state cause of action for retaliatory
discharge, a cause of action that embodies at least some of
the same protective policy concerns that are contained in
§ 510. See Teumer, 34 F.3d 547 (noting that § 510 protects
workers against “the disruption of employment privileges
to punish (i.e. retaliate for) the exercise of benefit rights”
(emphasis omitted)).
Nevertheless, we must conclude that the automatic
application of the forum state’s statute of limitations does
risk endangering federal policies by displacing them in
favor of state concerns that are driven by local geographical
factors or local interests and that are different from or
even inimical to national policy interests. “Federal law is no
judicial chameleon, changing complexion to match that of
each state wherever lawsuits happen to be commenced.”
D’Oench, Duhme & Co. v. FDIC, 315 U.S. 447, 471-72 (1942)
(Jackson, J., concurring).
A second possible approach is to fashion a choice of law
rule as a matter of federal common law by relying on the
approach to statutes of limitations set forth in the Restate-
ment (Second) of Conflict of Laws. See Held v. Mfrs. Hanover

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14 No. 05-2495
10 Section 142 provides:
Whether a claim will be maintained against the defense of
the statute of limitations is determined under the principles
stated in § 6. In general, unless the exceptional circumstances
of the case make such a result unreasonable:
(1) The forum will apply its own statute of limitations
barring the claim.
(2) The forum will apply its own statute of limitations
permitting the claim unless:
(a) maintenance of the claim would serve no
substantial interest of the forum; and
(b) the claim would be barred under the statute of
limitations of a state having a more significant
relationship to the parties and the occurrence.
Restatement (Second) of Conflict of Laws § 142.
11 See also Keeton v. Hustler Magazine, Inc., 465 U.S. 770, 778 (1984)
(“There has been considerable academic criticism of the rule
that permits a forum State to apply its own statute of limita-
tions regardless of the significance of contacts between the forum
State and the litigation.”).
Leasing Corp., 912 F.2d 1197, 1202 (10th Cir. 1990) (discussing
this approach). The Restatement has a special section
devoted to the selection of an appropriate statute of limita-
tions: Section 142. 10 This section was revised in 1988 to
reflect “the emerging trend” in the way courts were ap-
proaching limitations questions. See Reinke v. Boden, 45 F.3d
166, 168-69 (7th Cir. 1995). The comments to the revision
observed that, in the period after the adoption of the Second
Restatement in 1971, many courts had ceased to “character-
ize the issue of limitations as ipso facto procedural and
hence governed by the law of the forum.” Restatement
(Second) of Conflict of Laws § 142 cmt. e. 11 Instead, these
courts had decided that a claim should not be maintained

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No. 05-2495 15
12 Section 6(2) states that
the factors relevant to the choice of the applicable rule of law
include
(a) the needs of the interstate and international systems,
(b) the relevant policies of the forum,
(c) the relevant policies of other interested states and the
relative interests of those states in the determination of
the particular issue,
(d) the protection of justified expectations,
(e) the basic policies underlying the particular field of
law,
(f) certainty, predictability and uniformity of result, and
(g) ease in the determination and application of the law
to be applied.
Restatement (Second) of Conflict of Laws § 6(2).
“if it is barred by the statute of limitations of the state
which, with respect to the issue of limitations, is the state of
the most significant relationship to the occurrence and the
parties.” Id. As revised, section 142 resolves limitations
conflicts through the Restatement’s general, multi-factor
“interest analysis,” id. § 6(2), 12 despite retaining “a decided
forum bias.” Eugene F. Scoles et al., Conflict of Laws 130
(4th ed. 2004).
Application of the Restatement approach to the task
before us requires a significant amount of prudence and
caution. Full-scale implementation of the Restatement
would amount to using a tool created for one task to
accomplish another. Section 142 provides that, if the forum
has a longer statute of limitations that would permit the
claim, the longer period should apply unless there is no
“substantial” forum interest and the “state having a more
significant relationship to the parties and the occurrence”

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16 No. 05-2495
would bar the claim. Restatement (Second) of Conflict of
Laws § 142(2)(a), (b). This task of accommodating the
interests of two states is, of course, not the appropriate focus
of the judicial inquiry in the task before us. Our task is not
to reconcile the competing interests of Illinois and New York
but to identify the state statute of limitations that is most
compatible with the underlying policies of the federal cause
of action before us, ERISA § 510. From this perspective,
Restatement § 142 is a helpful tool in our task only insofar
as it counsels that the appropriate statute of limitations, in
certain cases, may not be that of the jurisdiction in which the
court sits, but rather one from another jurisdiction that has
a more significant relationship with the parties and with the
transaction.
Our examination of these two approaches convinces us
that neither is a totally effective tool in identifying the
appropriate statute of limitations for a claim based on
federal law. Total adherence to forum law would provide a
great deal of certainty and avoid a “trial within a trial” on
the statute of limitations issue. Certainly, “ ‘[f]ew areas of
the law stand in greater need of firmly defined, easily
applied rules than does the subject of periods of limitations.’ ”
Wilson v. Garcia, 471 U.S. 261, 266 (1985) (quoting Chardon v.
Fumero Soto, 462 U.S. 650, 667 (1983) (Rehnquist, J., dissent-
ing)). There will be occasions, however, when the statute of
limitations of another state ought to be applied—not
because that state has a greater interest in the application of
its own law as opposed to the law of the forum—but
because application of that state’s law is more consistent
with the federal policies embodied in the substantive federal
statute. See Gluck, 960 F.2d at 1179 & n.8.
Because both of the methodologies that we have out-
lined are tools created for other tasks, some of our sister

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No. 05-2495 17
13 The Third and Ninth Circuits have employed this approach. See
Wang Labs., 990 F.2d at 1128; Gluck, 960 F.2d at 1179.
circuits have suggested a third approach. Under this
approach, a federal court selects a statute of limitations from
the forum state’s law unless another state has more signifi-
cant contacts with the dispute. 13 This approach gives
adequate, indeed great, weight to the concerns of predict-
ability, certainty and ease of administration. It also en-
sures at least some minimum congruence between the
policy concerns underlying the federal cause of action and
those underlying the state cause of action from which the
limitations period is borrowed.
We believe that this approach has significant merit.
However, the congruence may be truly minimal, and
therefore we hesitate to characterize forum law as the
“presumptive” choice. In our view, it is preferable to refer
to the forum’s limitations period instead as a starting
point. If another state with a significant connection to the
parties and to the transaction has a limitations period that
is more compatible with the federal policies underlying
the federal cause of action, that state’s limitations law ought
to be employed because it furthers, more than any other
option, the intent of Congress when it created the underly-
ing right.
C.
We now must apply this approach to the case before us.
In our view, New York is the state with the most significant
relationship to the parties and to the transaction. The
occurrence at issue here was the corporate decision on the
part of AXA to alter the criterion for determining wheth-

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18 No. 05-2495
14 Cf. Restatement (Second) Conflict of Laws § 192 cmt. h (noting
that, with respect to group life insurance policies, rights against
the insurer are usually governed by the law that governs the
master policy (usually the place of the corporate headquarters)
because it is “desirable that each individual insured should enjoy
the same privileges and protections”).
15 The plan’s choice-of-law provision cannot control our inquiry
for two reasons. First, it would be against the weight of precedent
to apply a broad choice-of-law provision to limitations issues
where, as here, the provision does not extend expressly
to statutes of limitations, see R.68-1, Ex.25 at 279 (“To the ex-
tent ERISA is not applicable or does not preempt state law, the
laws of the State of New York shall govern.”). See Cole v. Mileti,
133 F.3d 433, 437-38 (6th Cir. 1998); Gluck, 960 F.2d at 1179; Trs.
Operative Plasterers’ & Cement Masons’ Local Union Officers &
Employees Pension Fund v. Journeymen Plasterers’ Protective &
Benevolent Soc’y, Local Union No. 5, 794 F.2d 1217, 1221 (7th Cir.
1986). Second, the plaintiffs’ claim does not arise out of the
plan itself. Rather, it is an action for interference with the
employment status of the salesmen that in turn ends up denying
(continued...)
er an employee ought to be considered a full-time insurance
salesman. That change was made by AXA management in
New York and documented by evidence and by witnesses
in New York. Moreover, the decision was applicable to all
AXA’s salesmen, not simply to those in Illinois. Although
the named plaintiffs reside in Illinois, other members of the
class reside in states other than Illinois. Thus, Illinois is
simply a spoke rather than the hub of this lawsuit. 14 Addi-
tionally, although not dispositive to our decision today, it is
not entirely irrelevant that the plan chose New York law to
govern non-ERISA disputes arising out of the document.
Although the choice of law clause does not apply directly to
the problem before us, 15 its presence serves as strong

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No. 05-2495 19
15 (...continued)
them benefits under the plan. The plan’s contractual choice-of-
law provision cannot control a claim under § 510 that is by
definition extra-contractual.
evidence of the parties’ “justified expectations,” see Restate-
ment (Second) of Conflict of Laws § 6(2), that New York law
would fill in the necessary gaps in federal ERISA law.
We recognize, of course, that Illinois, as the forum state
and home to the named plaintiffs, has some connection with
this action. Indeed, the comments to Restatement § 142
recognize that, at least in state court litigation, the decision
of which state’s law to apply “becomes difficult in situations
where, although the forum is not the state of the most
significant relationship to important issues in the case, some
forum interest would be served by entertainment of the
claim,” as, for example, “where the domicil of the plaintiff
is in the state of the forum.” Id. § 142 cmt. g. However, the
comments go on to say that, “[i]n such a situation, the forum
should entertain the claim only in extreme and unusual
circumstances.” Id. This latter statement, made by the
Restatement authors in the context of state conflicts jurispru-
dence, seems even more important in the context of ERISA,
where uniformity of treatment among beneficiaries is a
primary concern. See generally Pilot Life Ins. Co. v. Dedaux,
481 U.S. 41, 56 (1987) (discussing the legislative history of
ERISA on the need for uniformity of treatment). Indeed,
were we to follow the plaintiffs’ theory to its logical end,
this class action would be governed by a “crazy quilt” of
limitations periods and the federal interest in uniformity
would be rendered nugatory. Doe v. Blue Cross & Blue Shield,
112 F.3d 869, 874 (7th Cir. 1997). We conclude therefore that
application of New York limitations law to the present

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20 No. 05-2495
dispute better serves the federal policies at issue in this case
and should displace the law of the forum.
D.
Now that we have selected New York law as the source of
the applicable limitations period, we must “ ‘characterize
the essence of’ the federal claim in question and find the
most analogous cause of action.” Teumer, 34 F.3d at 547
(citing Wilson, 471 U.S. at 267-70). In Teumer, we held that
allegations similar to the ones set forth in this complaint
most resembled the tort of retaliatory discharge under
Illinois law, which, like § 510, encompasses “discharges that
either retaliate against or interfere with the exercise of
favored rights.” Teumer, 34 F.3d at 549 (emphasis in origi-
nal). Noting that § 510 protects workers against the “dis-
ruption of employment privileges to prevent (i.e. interfere
with) the vesting or enjoyment of benefit rights,” we
concluded that the Illinois tort of retaliatory discharge
captured “ ‘the essence of’ the federal claim in question” and
was therefore “the most analogous cause of action.” Teumer,
34 F.3d at 546-47 (emphasis in original) (quoting Wilson, 471
U.S. at 267-70).
Like Illinois, New York has a retaliatory discharge
cause of action, contained in New York Workers’ Compen-
sation Law § 120. Section 120 provides in pertinent part:
It shall be unlawful for any employer or his or her
duly authorized agent to discharge or in any other
manner discriminate against an employee as to his or
her employment because such employee has claimed or
attempted to claim compensation from such employer,
or because he or she has testified or is about to testify in
a proceeding under this chapter and no other

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No. 05-2495 21
valid reason is shown to exist for such action by the
employer.
Any complaint alleging such an unlawful discrimina-
tory practice must be filed within two years of the
commission of such practice. . . .
N.Y. Work. Comp. Law § 120. The Second Circuit, relying
expressly on our analysis in Teumer, held that section 120 of
the workers’ compensation law provides the closest New
York analog to a suit under § 510. See Sandberg v. KPMG Peat
Marwick, L.L.P., 111 F.3d 331, 335-36 (2d Cir. 1997). Noting
that section 120 protects against the same employer actions
as § 510, including employer interference with obtaining
benefits, our colleagues on the Second Circuit believed the
parallel between the New York statute and § 510 to be
“obvious.” Id. at 336. We agree; the plaintiffs’ therefore had
two years to institute this proceeding.
E.
Finally, we must determine what event started the
clock running on the two-year limitations period. This
question of “accrual” is decided by reference to federal
common law. See Tolle, 977 F.2d at 1138 (citing Delaware
State Coll. v. Ricks, 449 U.S. 250 (1980)). We begin our
analysis by identifying the alleged unlawful conduct that
forms the basis for the claim and then ascertaining
when this act occurred. See Tolle, 977 F.2d at 1139. After
fixing the date of the alleged unlawful act, we then deter-
mine when the plaintiffs discovered “an injury resulting
from this unlawful act.” Id. In this case, for the plaintiffs’
claims to have been timely under the applicable two-year
statute of limitations, those claims must have accrued
some time after January 7, 2001.

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22 No. 05-2495
16 Finally, the plaintiffs argue that, even if they discovered the
factual basis for their claim as early as January 1999, they suffered
(continued...)
In an action under § 510, the unlawful act is the deci-
sion to interfere purposefully with a plan “participant’s
ability to collect benefits to which the participant would
otherwise be entitled or from taking actions to prevent
such a participant from collecting benefits to which he or
she may become entitled.” Id. Because an employer
can violate this prohibition before a participant has applied
for or even becomes entitled to benefits, the accrual of a
§ 510 claim turns on the discovery of the decision to inter-
fere with benefits rather than on the eventual effect of that
decision. This was our reasoning in Tolle, in which
we rejected a plaintiff’s claim that her § 510 claim accrued
on the date that her termination went into effect instead
of on the date of the defendant’s earlier decision to termi-
nate her. We held that “it is the decision and the partici-
pant’s discovery of this decision that dictates accrual.” Id. at
1140-41; see also Teumer, 34 F.3d at 550.
As a result, we cannot accept the plaintiffs’ contention that
“[i]t is the application of the policy to a particular plaintiff,
not the existence of the policy in the abstract, that violates
the law and causes injury to each employee.” Appellants’
Br. at 23. Here, the plaintiffs’ § 510 claim is directed at
AXA’s 1998 change in its method for determining a sales-
man’s full-time status. As in Tolle, the plaintiffs’ discovery
of their employer’s allegedly unlawful decision put them on
notice of a potential ERISA violation and provided the
factual basis for their claim. The clock started running at this
moment, not when the plaintiffs eventually failed to meet
their sales quotas and ultimately lost eligibility. 16

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No. 05-2495 23
16 (...continued)
a continuing violation each time that AXA terminated their plan
eligibility for failure to meet the new sales quotas. As authority
for this proposition, the plaintiffs rely on Bazemore v. Friday, 478
U.S. 385 (1986), a case in which black agricultural workers were
permitted to recover for a pattern of salary discrimination that
began prior to the enactment of the civil rights laws; the Court
allowed the claims because each week’s discriminatory paycheck
was considered to be a new and actionable wrong. The plaintiffs
in this case have not alleged a continuing wrong. Although the
plaintiffs may have felt the continuing effects of their ineligibility
for ERISA benefits, their allegations make clear that AXA’s
wrongful conduct, if any, involved the decision to change the way
it classified insurance salesmen. There are no allegations that,
once AXA had changed its policy, it then applied the new policy
in a discriminating manner among salesmen. The plaintiffs
therefore have alleged one violation not several, and it must be
from the date of this single violation that the plaintiffs’ time for
filing their claim began to run. Cf. Delaware State Coll. v. Ricks, 449
U.S. 250, 258 (1980) (“It is simply insufficient for [the plaintiff] to
allege that his termination gives present effect to the past illegal
act and therefore perpetuates the consequences of forbidden
discrimination.” (internal quotation marks omitted)).
Because the plaintiffs brought this action more than two
years after their claim accrued, the district court properly
dismissed the action as time-barred.
Conclusion
For the foregoing reasons, the judgment of the district
court is affirmed.
A FFIRMED

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24 No. 05-2495
A true Copy:
Teste:
________________________________
Clerk of the United States Court of
Appeals for the Seventh Circuit
USCA-02-C-0072—8-18-06

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