Kane v. UPS Pension Plan Board of Trustees
MEMORANDUM OPINION. Signed by Judge Richard D Bennett on 10/23/13. (c/m apls, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
Civil Action No. RDB-11-3719
UPS PENSION PLAN BOARD
Plaintiff Gregory Kane (“Plaintiff”) brings this action for alleged violations of the
Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. (“ERISA”). 1
Presently pending before this Court is Kane’s Motion to Reinstate a Claim (ECF No. 38). 2
Specifically, Plaintiff seeks to reinstate Count II of his original Compliant, which alleged that
Defendant UPS Pension Plan Board of Trustees (“Defendant”) breached its fiduciary duties
under § 404 of ERISA “by failing to administer the plan in a prudent manner in the interests of
the Plan’s participants; and by failing to administer the plan” consistent with the statutory
mandates of ERISA § 404(a)(1)(D). See Pl.’s Compl. ¶ 42. UPS Pension Board opposes
Plaintiff’s Motion on the grounds that the motion is untimely; that there is no good cause to
permit amendment at this stage of the proceeding; and that amendment would be futile under
See generally Def.’s Mem. Opp’n, ECF No. 42.
The Court has reviewed the
As is common practice, this Court will refer to sections of ERISA by the section numbers contained within the
statute itself rather than the United States Code. Cf. Coyne & Delaney Co. v. Blue Cross & Blue Shield of Va., 102
F.3d 712, 714 (4th Cir. 1996). Citations, however, are to the United States Code for purposes of quick reference.
In addition, both parties have filed Cross Motions for Summary Judgment (ECF Nos. 33 and 34). This Court will
rule on those Motions by separate Memorandum Opinion and Order at a future date.
submissions by both parties and finds that no hearing is necessary. See Local Rule 105.6 (D.
Md. 2011). For the reasons that follow, Plaintiff Kane’s Motion to Reinstate a Claim (ECF No.
38) is DENIED.
FACTUAL & PROCEDURAL BACKGROUND
For purpose of this Motion, this Court accepts as true the facts alleged in the Plaintiffs’
Complaint. See Aziz v. Alcolac, Inc., 658 F.3d 388, 390 (4th Cir. 2011). Plaintiff filed this
action on December 23, 2011, asserting a claim for improper denial of benefits under ERISA §
502(a)(1)(B) (“Count I”) and a claim for breach of fiduciary duty pursuant to ERISA § 502(a)(2)
(“Count II”). On March 12, 2012, the parties stipulated to a voluntary dismissal of Count II
without prejudice. See Stipulation of Dismissal, ECF No. 5 (“The parties stipulate that Plaintiff
dismisses Count II without prejudice to reinstate the claim as if originally filed on December 23,
2011. . . .”).
This Court issued the original Scheduling Order (ECF No. 10) on March 14, 2012.
Subsequently, this Court granted the parties’ Joint Proposal to Modify the Scheduling Order
(ECF No. 13) and moved the deadlines for amendment of pleadings and for requesting discovery
to May 29, 2012.3 See Modified Scheduling Order, ECF No. 14. Thereafter, Plaintiff filed a
Motion for Limited Discovery (ECF No. 15), which this Court granted in part and denied in part
on November 19, 2012. See Order, ECF No. 26. Discovery was to be completed by February
27, 2013. Id.
Then, in March 2013, this Court granted the parties’ proposal to extend the deadline for
dispositive motions to May 15, 2013 in order to “permit Plaintiff sufficient time to review the
remaining documents and secure any remaining information related to the same.” See Joint
In addition, the Court set the discovery cut-off date for 90 days after any order granting discovery. See Modified
Scheduling Order, ECF No. 14.
Status Report and Consent Request, ECF No. 27; Order, ECF No. 28. On May 8, 2013, Plaintiff
moved for an additional extension, stating that four additional items had not been produced until
April 29, 2013, and that time was too short to review the materials before the dispositive motion
deadline due to various conflicts in the schedules of Plaintiff and Plaintiff’s counsel. See
Unopposed Req. of Pl. Extension Deadline, ECF No. 29. The Court granted this request and
extended the dispositive motion deadline to June 14, 2013. See Order, ECF No. 30. Thereafter,
this Court granted the parties’ Joint Motion to Set Briefing Schedule (ECF No. 31), which
established the following schedule for the parties’ cross-motions for summary judgment:
Plaintiff’s Motion – June 14, 2013
Defendant’s Response and Cross-Motion – July 3, 2013
Plaintiff’s Reply and Response to Cross-Motion – July 23, 2013
Defendant’s Reply – August 9, 2013
In accordance with this schedule, Plaintiff filed his Motion for Summary Judgment on-time on
June 14, 2013. Notably, Plaintiff claimed he was entitled to judgment on Count II, but he did not
move to reinstate his claim. See Pl.’s Mem. Supp. Mot. Summ. J., ECF No. 33-1, at 21-25. On
July 3, 2013, Defendant filed its timely Response and Cross-Motion for Summary Judgment
(ECF No. 34-1), in which Defendant noted that Count II had been dismissed. On July 22—the
day before the deadline—Plaintiff moved for a three day extension to file his Response. After
this Court granted the extension (ECF No. 36), Plaintiff filed his Reply and Opposition (ECF No.
37) on July 27, 2013. Contemporaneously, Plaintiff filed the pending Motion to Reinstate a
Claim (ECF No. 38).
STANDARD OF REVIEW
When a party seeks leave to amend a pleading after the deadline set in the court’s
scheduling order, the party must satisfy both the “good cause” standard of Rule 16(b)(4) and
Rule 15(a)(2)’s standard for amending pleadings. See CBX Tech., Inc. v. GCC Tech., LLC, JKB3
10-2112, 2012 WL 3038639, at *3 (D. Md. July 24, 2012); see also Nourison Rug Corp. v.
Parvizian, 535 F.3d 295, 298–99 (4th Cir. 2008) (“[A]fter the deadlines provided by a
scheduling order have passed, the good cause standard must be satisfied to justify leave to
amend.”); Odyssey Travel Center, Inc. v. RO Cruises, Inc., 262 F. Supp. 2d 618, 631 (D. Md.
2003)(“[O]nce the scheduling order’s deadline for amendment of the pleadings has passed, a
moving party first must satisfy the good cause standard of Rule 16(b); if the moving party
satisfies Rule 16(b), the movant then must pass the tests for amendment under [Rule] 15(a).”).
Under the “good cause” analysis required by Rule 16(b) of the Federal Rules of Civil
Procedure, the timeliness of the motion to amend “and the reasons for its tardy submission” are
more important than the substance of the proposed amendment. Rassoull v. Maximus, Inc., 209
F. R. D. 372, 373-74 (D. Md. 2002). A court’s scheduling order “‘is not a frivolous piece of
paper, idly entered, which can be cavalierly disregarded by counsel without peril.’” Potomac
Electric Power Co. v. Electric Motor Supply, Inc., 190 F.R.D. 372, 376 (D. Md.1999) (quoting
Gestetner v. Case Equipment Co., 108 F.R.D. 138, 141 (D. Me. 1985)). “‘Properly construed,
“good cause” means that scheduling deadlines cannot be met despite a party’s diligent efforts.’ . .
. Carelessness is not compatible with a finding of diligence and offers no reason for a grant of
relief.” Potomac Elec., 190 F.R.D. at 375 (citations omitted). In determining whether “good
cause” exists, a court must consider the “danger of prejudice to the non-moving party, the length
of the delay and its potential impact on judicial proceedings, the reason for the delay, and
whether the movant acted in good faith.” Tawwaab v. Virginia Linen Service, Inc., 729 F. Supp.
2d 757, 768-69 (D. Md. 2010) (internal quotation marks and citation omitted). Importantly,
“good cause” generally exists where at least some of the evidence necessary to prove the
plaintiff’s claim did not come to light until after the amendment deadline; however, leave to
amend will be denied if the plaintiff cannot account, to the court’s satisfaction, for his failure to
discover the evidence earlier, or if that failure was the result of carelessness. Id. (citing In re
Lone Star Indus., Inc. Concrete R.R. Cross Ties Litig., 19 F.3d 1429 (Table) (4th Cir. 1994);
Whichard v. Specialty Restaurants Corp., 220 F.R.D. 439, 441 (D. Md. 2004).
Rule 15(a) of the Federal Rules of Civil Procedure provides the general rules for
amending pleadings, and satisfaction of the requirements of Rule 15(a) constitutes the second
step for the analysis for a motion to amend a pleading after the deadline prescribed in the
scheduling order has passed. Specifically, Rule 15(a) requires that, after a responsive pleading is
served, a plaintiff may amend his complaint “by leave of court or by written consent of the
adverse party.” In general, leave to amend a complaint pursuant to Rule 15(a) shall be “freely”
granted “when justice so requires.” Fed. R. Civ. P. 15(a)(2); see also Lance v. Prince George’s
County, Md., 199 F. Supp. 2d 297, 300-01 (D. Md. 2002). The matter, however, is committed to
the discretion of the district court, see Simmons v. United Mortg. & Loan Inv., LLC, 634 F.3d
754, 769 (4th Cir. 2011), and the district judge may deny leave to amend “when the amendment
would be prejudicial to the opposing party, the moving party has acted in bad faith, or the
amendment would be futile.” Equal Rights Center v. Niles Bolton Assocs., 602 F.3d 597, 603
(4th Cir. 2010); see also Foman v. Davis, 371 U.S. 178, 182 (1962).
Plaintiff Kane seeks to reinstate Count II of his original Complaint, which alleged a
breach of fiduciary duty pursuant to § 502(a)(2) of ERISA. However, this Court entered a
revised scheduling order (ECF No. 13) on March 28, 2012, and subsequent orders set the
deadline for dispositive motions as June 14, 2013. Plaintiff’s Motion to Reinstate a Claim did
not come until July 27, 2013. Thus, Plaintiff’s attempt to amend its pleadings came after the
Court issued a scheduling order and after the deadline for dispositive motions; accordingly,
Plaintiff must satisfy both the “good cause” standard of Rule 16(b) and the requirements of Rule
15(a) for amendment of pleadings. As explained herein, Plaintiff’s attempt to reinstate Count II
fails in both respects.
Good Cause Under Rule 16(b)
Plaintiff has failed to demonstrate any good cause for reinstating his claim only at this
stage in the proceeding. Plaintiff baldly alleges that “[u]pon completion of discovery, . . .
Plaintiff concluded that Count II has merit, and will affect other UPS employees who were
similarly situated to Plaintiff.” See Mot. Reinstate Claim, ECF No. 38, at 1. In his Reply Brief,
Kane further states:
The Defendant stipulated that Plaintiff could reinstate
Count II. Doc. No. 37 at 13-15. That stipulation reserved Plaintiff’s
right to reinstate the claim if the record developed facts supporting
the claim. Plaintiff argues that such facts have been developed
supporting the breach of fiduciary duty claim. For the reasons
described above, it does not follow that Plaintiff’s motion to
reinstate this claim should be denied or that the motion is untimely.
Pl.’s Reply, ECF No. 43, at 6. Thus, Plaintiff relies on the mere fact that Defendant initially
agreed in principle to the notion that Plaintiff could reinstate the claim; however, nowhere does
Plaintiff explain why the request for reinstatement comes only at this stage in the proceeding.
While Plaintiff alludes to new evidence, he has not identified any particular piece of evidence
that was previously unknown or undiscovered.
Moreover, Plaintiff has received a number of extensions of various scheduling deadlines
over the span of this litigation. In particular, after Plaintiff received some final discovery on
April 29, 2013, this Court permitted an extension of the dispositive motion deadline. Despite
this extension, Plaintiff did not seek to reinstate the claim until forty-three days after the
dispositive motions deadline.4
In light of these factual circumstances, Plaintiff has not provided the Court with any
justification for his delay. In particular, Plaintiff has failed to demonstrated in any way why the
evidence could not have been discovered earlier or that the delay was not the result of
carelessness. See Tawwaab v. Virginia Linen Service, Inc., 729 F. Supp. 2d 757, 768-69 (D. Md.
2010). Accordingly, Kane has failed to demonstrate good cause for amendment of his Complaint
at this stage of the proceeding.
A. Amendment under Rule 15(a) & the Futility Standard.
Even if Kane had demonstrated good cause for reinstatement of Count II, Plaintiff’s
Motion must be denied because the claim is ultimately futile. Plaintiff seeks to reinstate Count II
of his original Complaint, which states:
Pursuant to ERISA § 502(a)(2), Plaintiff alleges that Defendant
breached its fiduciary duties under ERISA §§ [sic] 404, 29 U.S.C.
§ 1104, by failing to administer the plan in a prudent manner in the
interests of the Plan’s participants, and failing to administer the
plan consistent with its terms as required under ERISA §
Pl.’s Compl. ¶ 42.
Section 502 contains the provisions for civil enforcement of ERISA.
502(a)(1)(B) provides for a civil action “by a participant or beneficiary” “to recover benefits due
to him under the terms of his plan, or to enforce his rights under the terms of the plan, or to
clarify his rights to future benefits under the terms of the plan.” 29 U.S.C. § 1132(a)(1)(B). As
In addition, Kane was alerted to the problem by Defendant’s July 3, 2013 Memorandum in Opposition and CrossMotion for Summary Judgment (ECF No. 34-1), which pointed out that Count II had not been reinstated.
the Supreme Court of the United States has summarized, the purpose of § 502(a)(1)(B) is to
redress individuals’ claims for denial of benefits:
If a participant or beneficiary believes that benefits promised to
him under the terms of the plan are not provided, he can bring suit
seeking provision of those benefits. A participant or beneficiary
can also bring suit generically to “enforce his rights” under the
plan, or to clarify any of his rights to future benefits.
Aetna Health Inc. v. Davila, 542 U.S. 200, 210 (2004). Thus, § 502(a)(1)(B) is the mechanism
by which individuals may collect benefits due. This is precisely the claim that Plaintiff has made
in Count I.
In contrast, § 502(a)(2) provides a remedy for injuries to the plan as a whole rather than
individual injuries. 5 LaRue v. DeWolff, Boberg & Associates, 552 U.S. 248, 256 (2008).
Specifically, § 502(a)(2) provides for a civil suit “by the Secretary, or by a participant,
beneficiary or fiduciary for appropriate relief” for a breach of a fiduciary duty by plan
administrators. 6 29 U.S.C. § 1132(a)(2).
Section 404 enumerates the particular duties of
fiduciaries. In particular, plan fiduciaries must act “with the care, skill, prudence, and diligence
under the circumstances then prevailing that a prudent man acting in a like capacity and familiar
with such matters would use in the conduct of an enterprise of a like character and like aims.” 29
In LaRue, the Court also recognized a narrow exception to this general rule, holding that that a plaintiff could
recover under § 502(a)(2) for “fiduciary breaches that impair the value of plan assets in a participant’s individual
account” under a defined contribution plan. 552 U.S. at 256. This exception does not apply in this case, however,
because Plaintiff’s claims relate to a pension plan—not a defined contribution plan.
Specifically, § 502(a)(2) states that “[a] civil action may be brought by the Secretary, or by a participant,
beneficiary or fiduciary for appropriate relief under section  of this title.” 29 U.S.C. § 1132(a)(2). In turn, the
relevant portion of § 409 reads:
Any person who is a fiduciary with respect to a plan who breaches any of the
responsibilities, obligations, or duties imposed upon fiduciaries by this
subchapter shall be personally liable to make good to such plan any losses to the
plan resulting from each such breach, and to restore to such plan any profits of
such fiduciary which have been made through use of assets of the plan by the
fiduciary, and shall be subject to such other equitable or remedial relief as the
court may deem appropriate, including removal of such fiduciary.
29 U.S.C. § 1109(a). The duties of plan fiduciaries are laid out in § 404, as explained infra.
U.S.C. § 1104(a)(1)(B).
In addition, § 404(a)(1)(D) requires fiduciaries to act “in accordance
with the documents and instruments governing the plan insofar as such documents and
instruments are consistent with the provisions of this subchapter and subchapter III of this
chapter.” 29 U.S.C. § 1104(a)(1)(D). Notably, however, the duties imposed upon fiduciaries
“‘relate to the proper management, administration, and investment of fund assets,’ with an eye
toward ensuring that ‘the benefits authorized by the plan’ are ultimately paid to participants and
beneficiaries.” LaRue v. DeWolff, Boberg & Associates, 552 U.S. 248, 253 (2008) (quoting
Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 142 (1985)). Thus, “§ 502(a)(2) does
not provide a remedy for individual injuries distinct from plan injuries.” Id. at 256.
Here, the gravamen of the Complaint is that the Defendant improperly calculated Kane’s
benefits by failing to credit all of the hours Plaintiff worked while transitioning from a part-time
employee to a full-time position. Essentially, he argues that greater benefits are owed to him.
Thus, Count II of Plaintiff’s Complaint is the epitome of a personal claim for an individual
injury—the type of claim that is specifically barred under § 502(a)(1)(B). See Varity Corp. v.
Howe, 516 U.S. 489, 512 (1996) (“ERISA specifically provides a remedy for breaches of
fiduciary duty with respect to the interpretation of plan documents and the payment of claims,
one that is outside the framework of the second subsection and cross-referenced § 409, and one
that runs directly to the injured beneficiary. § 502(a)(1)(B).”). Moreover, because Plaintiff’s
Count II fails to state a claim, amendment and/or reinstatement would be futile. See Wonasue v.
University of Maryland Alumni Ass’n, --- F.R.D. ---, No. PWG-11-2657, 2013 WL 3009316, at
*3 (D. Md. June 14, 2013) (stating that futility may be found where “the proposed amended
complaint fails to state a claim under the applicable rules and accompanying standings” (internal
quotation marks omitted)).7
For the reasons stated above, Plaintiff Gregory Kane’s Motion to Reinstate a Claim (ECF
No. 38) is DENIED.
A separate Order follows.
October 23, 2013
Richard D. Bennett
United States District Judge
Because there is no good cause for reinstatement of Count II and because reinstatement of Count II would be
futile, this Court need not address Defendant’s additional argument that Count II is barred by ERISA’s statute of
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