Perez v. Silva et al
MEMORANDUM AND ORDER granting 53 Motion of AmeriGuard Security Services, Inc. for Leave to Amend to Include a Cross-Claim; granting in part and denying in part 78 Motion of plaintiff to Deem Admitted Plaintiffs Requests for Admissions. Signed by Judge James K. Bredar on 2/21/2017. (jnls, Deputy Clerk)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
THOMAS E. PEREZ,
Secretary of Labor,
United States Department of Labor,
RICARDO SILVA et al.,
CIVIL NO. JKB-15-3484
MEMORANDUM AND ORDER
Now before the Court are two motions:
Defendant AmeriGuard Security Services, Inc.’s Motion for Leave to Amend to Include a
Cross-Claim (ECF No. 53), and
Plaintiff Secretary Thomas E. Perez’s Motion to Deem Admitted Plaintiff’s Requests for
Admissions (ECF No. 78).
AmeriGuard’s motion has been opposed by Plaintiff and Defendants Charles Ezrine and
State Employee Benefits, Inc. (“SEBI”) (ECF Nos. 57 & 58), and AmeriGuard has filed replies
to both responses in opposition (ECF Nos. 61 & 62).
Plaintiff’s motion was opposed by
Defendants Ezrine and SEBI (ECF No. 79); no reply was filed. No hearing is required. Local
Rule 105.6 (D. Md. 2016). AmeriGuard’s motion will be granted, and Plaintiff’s motion will be
granted in part and denied in part.
I. AmeriGuard’s Motion to Amend
A. Standard for Motion to Amend
In the circumstances presented here, when a party’s motion to amend pleadings is filed
within the deadline that has been set in a scheduling order for filing motions for amendment of
pleadings, a motion for permission to amend is governed by Rule 15(a), which directs the Court
to “freely give leave when justice so requires.” The Fourth Circuit has stated that leave to amend
under Rule 15(a) should be denied only in three situations: when the opposing party would be
prejudiced, when the amendment is sought in bad faith, or when the proposed amendment would
be futile. Laber v. Harvey, 438 F.3d 404, 426 (4th Cir. 2006). A proposed amendment is
considered futile if it cannot withstand a motion to dismiss. Perkins v. United States, 55 F.3d
910, 917 (4th Cir. 1995).
This action was brought by Plaintiff against seven Defendants, alleging violations of the
Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001 et seq. Specifically,
Plaintiff alleges the Maryland Association of Correctional & Security Employees, Inc.
(“MACSE”) (a union of correctional and security employees), Ricardo Silva (president and chief
executive officer of MACSE and of Ricardo Silva & Associates, Inc.), AmeriGuard (a security
services company that provided security guards at the Centers for Medicare and Medicaid
Services), State Employee Benefits, Inc. (“SEBI”) (owned by Ezrine), and Ezrine were
fiduciaries with respect to the Maryland Association of Correctional Security Employees Health
& Welfare Plan (“Health Plan”) and the Maryland Association of Correctional & Security
Employees Retirement Plan (“Retirement Plan”). Plaintiff alleges Defendants breached their
fiduciary duties to the Health Plan and the Retirement Plan, inter alia, by not providing proper
documentation for the Plans, by not establishing or maintaining proper procedures for funding
and administering the Plans, by improperly commingling MACSE’s assets with the Plans’ assets,
by charging improper administrative fees, by using one Plan’s assets to pay another Plan’s
expenses, and by improperly transferring Plan assets to MACSE’s general operating account.
(Compl., ECF No. 1.) Plaintiff seeks various forms of relief including requiring “MACSE, Silva,
SEBI, Ezrine, and AmeriGuard to jointly and severally restore all losses caused to the Plans as a
result of their fiduciary breaches.” (Id. Prayer for Relief.)
AmeriGuard is alleged to never have signed a plan document for the Health Plan (id.
¶ 25), to “have never appointed or even attempted to appoint a separate employer trustee to
administer the Plans” (id. ¶ 27), to have never taken “any actions to monitor the Health Plan
trustee or administrators” (id. ¶ 28), and to have never taken “any actions to monitor the
Retirement Plan trustee or administrators” (id. ¶ 29). Otherwise, the allegations are largely
focused on the actions or inactions of MACSE, Silva, SEBI, and Ezrine.
Within the time set by the Court’s scheduling order (ECF No. 47), AmeriGuard moved to
amend its answer by adding a cross-claim against Silva, MACSE, Ezrine, and SEBI. (ECF
No. 53.) Its basic gist is that AmeriGuard’s conduct in relation to the Plans was, at best,
tangential to the much greater involvement of the other co-Defendants.
AmeriGuard seeks indemnification by and contribution from its four co-Defendants.
Taking first the opposition by Ezrine and SEBI, the Court is unpersuaded that they will
be prejudiced or suffer undue delay by the Court’s allowance of the cross-claim in the case.
They claim they had no fiduciary responsibilities—a determination that cannot be made at this
juncture of the case—and, therefore, it would be unfair to require them to defend AmeriGuard’s
cross-claim. The scheduling order has been amended more than once, and time remains for the
parties to engage in appropriate discovery on the cross-claim. Ezrine and SEBI also contend that
AmeriGuard should have known of the basis for its cross-claim sooner, but AmeriGuard
responds that it was only in the litigation of this case that it became aware of the facts giving rise
to the cross-claim. The Court perceives no unnecessary delay by AmeriGuard in seeking to
bring this cross-claim, especially since its motion was timely filed according to the scheduling
order. Ezrine’s and SEBI’s objections are without merit.
The Court has also considered Plaintiff’s opposition, but finds it, too, is unmeritorious.
The Court notes that Plaintiff’s filing is captioned, “Secretary of Labor’s Opposition to
Defendant AmeriGuard Security Services, Inc.’s Motion to Amend Answer and Motion to
Dismiss Cross-Claims”; however, the filing was not properly docketed as a motion. Beyond
that, the Court sees two problems with Plaintiff’s “motion to dismiss”:
first, it was filed
speculatively while the amended answer and cross-claim is, as yet, undocketed; second,
AmeriGuard’s filing is a cross-claim against co-Defendants, not a counterclaim against Plaintiff.
Plaintiff fails to explain how he has standing to file a motion under Federal Rule of Civil
Procedure 12(b)(6)—the stated basis for Plaintiff’s “motion” (Pl.’s Opp’n Supp. Mem. 9, ECF
No. 58-1)—when that rule is clearly addressed to the procedure for a defendant’s potential
responses to a claim made in a pleading against that defendant. The Court finds no standing by
Plaintiff to seek dismissal under Rule 12(b)(6), and to the extent Plaintiff’s filing constitutes a
motion, it is denied.
The core of Plaintiff’s opposition is his contention that AmeriGuard’s indemnification
and contribution claims are not available under ERISA, a fact that renders AmeriGuard’s motion
to amend futile. In reality, the Circuits are split on the issue, compare Chesemore v. Fenkell, 829
F.3d 803, 811-13 (7th Cir. 2016) (“ERISA’s grant of equitable remedial power and its
foundation in principles of trust law permit the courts to order contribution or indemnification
among cofiduciaries based on degrees of culpability”), cert. dismissed, No. 16-473 (R46-005),
2017 U.S. LEXIS 907 (Jan. 19, 2017), and Chemung Canal Trust Co. v. Sovran Bank/Maryland,
939 F.2d 12, 15-18 (2d Cir. 1991) (“incorporating traditional trust law’s doctrine of contribution
and indemnity into the law of ERISA is appropriate”), with Travelers Cas. & Sur. Co. of
America v. IADA Services, Inc., 497 F.3d 862, 867 (8th Cir. 2007) (“ERISA does not create a
right of contribution for Travelers against IADA Services, another fiduciary”), and Kim v.
Fujikawa, 871 F.2d 1427, 1432-33 (9th Cir. 1989) (“we cannot agree with Fujikawa’s contention
that Congress implicitly intended to allow a cause of action for contribution under ERISA”), and
the Fourth Circuit has not yet decided the question. Within the Fourth Circuit, district courts are
also of two minds. See, e.g., Openshaw v. Cohen, Klingenstein & Marks, Inc., 320 F. Supp. 2d
357, 363-64 (D. Md. 2004) (finding no right of contribution); Cooper v. Kossan, 993 F. Supp.
375, 376-77 (E.D. Va. 1998) (finding right of contribution).
As did the court in Cooper, this Court finds more persuasive the rationale of courts that
allow a claim for contribution. Id. at 377. One reason for finding such a right is that, in enacting
ERISA, Congress was focused on providing remedies for plan beneficiaries and participants and
was content on letting courts applying traditional principles of trust law to fill the gaps. Id.
Additionally, disallowance of contribution claims would “frustrate ERISA’s purpose of deterring
plan abuse by allowing breaching fiduciaries to escape the consequences of their actions.” Id.
“‘Full responsibility should not depend on the fortuity of which fiduciary a plaintiff elects to
sue.’” Id. (quoting Chemung, 939 F.2d at 16). Moreover, a contribution claim in this kind of
case “does not conflict with ERISA’s enforcement scheme, and it promotes both the enforcement
of strict fiduciary standards of care as well as the beneficiaries’ best interests.” Id. Finally, the
Supreme Court has generally endorsed use of the common law of trusts as a touchstone for
analysis of ERISA “[unless] it is inconsistent with the language of the statute, its structure, or its
purposes.” Hughes Aircraft Co. v. Jacobson, 525 U.S. 432, 447 (1999), quoted in Harris Trust
& Sav. Bank v. Salomon Smith Barney Inc., 530 U.S. 238, 250 (2000).
In contrast, the Court finds less persuasive the cases that rest upon Congress’s omission
of express language in favor of fiduciaries being able to seek indemnification and contribution.
See, e.g., Kim, 871 F.2d at 1432-33. Because allowance of a contribution claim does no violence
to ERISA’s remedial scheme and because it is consistent with the statutory grant of judicial
authority to grant “appropriate equitable relief” in response to a claim by an ERISA plan
participant, beneficiary, or fiduciary, 29 U.S.C. § 1132(a)(3), the Court concludes it is proper to
allow AmeriGuard’s cross-claim. Thus, its motion to amend is not futile and will be granted.
II. Plaintiff’s Motion to Deem Admitted Plaintiff’s Requests for Admissions
Plaintiff moves the Court to deem admitted Plaintiff’s requests for admissions that were
served upon Silva, who has proceeded pro se in this case. Plaintiff has clearly established that
Silva has responded to neither the requests themselves nor Plaintiff’s communications about the
need for Silva’s responses to the requests.
Under Rule 36(a)(3),
A matter is admitted unless, within 30 days after being served, the party to whom
the request is directed serves on the requesting party a written answer or objection
addressed to the matter and signed by the party or its attorney. A shorter or
longer time for responding may be stipulated to under Rule 29 or be ordered by
Thus, Plaintiff is entitled to have its motion granted, with one qualification. Defendants Ezrine
and SEBI have pointed out to the Court that Plaintiff served forty-four requests for admission on
Silva, but the Court’s Local Rule 104.1 limits a party to serving no “more than thirty (30)
requests for admission (other than requests propounded for the purpose of establishing the
authenticity of documents or the fact that documents constitute business records), including all
parts and sub-parts.” (Defs.’ Ezrine et al.’s Opp’n 2.) 1 In keeping with Local Rule 104.1,
Plaintiff’s motion will be granted as to its first thirty requests for admission and as to requests
forty-one through forty-four, which come under the rule’s exception for requests seeking
authentication of documents.
For the foregoing reasons, IT IS HEREBY ORDERED:
1. Defendant AmeriGuard Security Services, Inc.’s Motion for Leave to Amend to Include a
Cross-Claim (ECF No. 53) IS GRANTED.
2. The Clerk shall docket ECF No. 53-1 as AmeriGuard’s Amended Answer with
3. Cross-Defendants SHALL ANSWER in the time accorded by the Federal Rules.
4. Plaintiff’s Motion to Deem Admitted Plaintiff’s Requests for Admissions (ECF No. 78)
IS GRANTED as to requests one through thirty and forty-one through forty-four and IS
DATED this 21st day of February, 2017.
BY THE COURT:
James K. Bredar
United States District Judge
The Court is mindful that Ezrine and SEBI do not technically have standing to oppose Plaintiff’s motion
because they are not the ones at whom the motion is directed. However, the Court considers it significant that
Plaintiff filed no reply and did not refute Ezrine’s and SEBI’s volunteered observation, which is a valid point.
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