Hanna Furst, et al. v. Linda Mayne, et al.

• Court: District Court, D. Arizona
• Decided: January 5, 2026
• Docket: 2:20-cv-01651
• Status: Unknown

Opinion

1 WO 2 3 4 5 6 IN THE UNITED STATES DISTRICT COURT 7 FOR THE DISTRICT OF ARIZONA

9 Hanna Furst, et al., No. CV-20-01651-PHX-DLR

10 Plaintiffs, ORDER

11 v.

12 Linda Mayne, et al.,

13 Defendants. 14 15 16 According to the operative complaint, Plaintiff’s parents formed DHF Corporation 17 in the 1980s and were the company’s sole shareholders. (Doc. 1 at ¶ 15.) DHF Corporation 18 formed the DHF Corporation Profit Sharing Plan (the “Plan”), which the complaint alleges 19 is a defined contribution, individual account, employee pension benefit plan covered by 20 the Employment Retirement Income Security Act (“ERISA”). (Id. at ¶¶ 10, 16.) The Plan 21 sponsor is DHF Corporation; the sole employee-participant of the Plan was Plaintiff’s 22 father; and prior to February 2018, the Plan trustees and administrators were Plaintiff’s 23 parents. (Id. at ¶¶ 17-19.) In February 2018, Plaintiff and his sister, Defendant Linda 24 Mayne, were appointed as the Plan’s new co-trustees. (Id. at ¶ 21.) The complaint accuses 25 Defendant of breaching her fiduciary duties under ERISA. (Id. at ¶¶ 96-107.) 26 At issue is Plaintiff’s motion under Federal Rule of Civil Procedure 12(b)(1) to 27 dismiss his own case without prejudice for lack of subject-matter jurisdiction. (Doc. 168.) 28 Plaintiff contends that now, after five years of litigation and “[u]pon further review,” he 1 “had determined that the [P]lan is not an ERISA-covered plan as a matter of law,” and 2 therefore the Court lacks subject-matter jurisdiction because his complaint invoked only 3 this Court’s federal question jurisdiction. (Id. at 1; Doc. 1 at ¶ 5.) 4 In response, Defendant conspicuously avoids stating whether she agrees with 5 Plaintiff’s jurisdictional analysis. The response does not say whether Defendant agrees the 6 Plan is not governed by ERISA, or whether Defendant agrees that this issue is jurisdictional 7 in nature. And notably, Defendant previously took the position that the Plan is governed 8 by ERISA because it “adopts ERISA and incorporates ERISA standards[.]” (Doc. 91 at 7.) 9 Instead, Defendant responds that she does not oppose dismissal but asks that the Court 10 dismiss the case with prejudice. (Doc. 169.) In reply, Plaintiff argues that dismissals for 11 lack of subject-matter jurisdiction ordinarily operate without prejudice. (Doc. 170.) 12 The Court denies Plaintiff’s Rule 12(b)(1) motion because it is predicated on the 13 erroneous assumption that the issue of whether the Plan is governed by ERISA is 14 jurisdictional. “[T]o ask whether the alleged Plan is subject to ERISA is a merits question.” 15 Daniels-Hall v. National Educ. Ass'n, 629 F.3d 992, 997-98 (9th Cir. 2010) (emphasis 16 added). “Whether a particular ‘Plan’ is an employee benefit pension plan, and thus whether 17 a particular defendant is subject to ERISA, is therefore a question on the merits of the 18 claim, not an issue of subject matter jurisdiction.” Id. (cleaned up). 19 Although the Court denies Plaintiff’s Rule 12(b)(1) motion, it will order Plaintiff to 20 show cause in writing why this case should not be dismissed with prejudice because 21 Plaintiff now admits that he cannot prove an essential element of his case—namely, that 22 the Plan is subject to ERISA. 23 IT IS ORDERED as follows: 24 1. By no later than January 12, 2026, Plaintiff shall show cause in writing, limited 25 to 5 pages, why this case should not be dismissed with prejudice because 26 Plaintiff now admits that he will be unable to prove that the Plan is subject to 27 ERISA. 28 2. By no later than January 20, 2026, Defendant may reply to Plaintiff’s response 1 to this Court’s order to show cause. Any such reply is likewise limited to 5 pages 2 and should address whether Defendant agrees that the Plan is not subject to 3 ERISA, notwithstanding Defendant’s contrary position earlier in this litigation. 4 (See Doc. 91 at 7.) 5 Dated this 2nd day of January, 2026. 6 7

9 Do . Rayes 10 United States District Judge 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28

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