Metaxas v. Gateway Bank F.S.B.

• Court: District Court, N.D. California
• Decided: July 18, 2024
• Docket: 3:20-cv-01184
• Status: Unknown

Opinion

1 2 3 4 UNITED STATES DISTRICT COURT 5 NORTHERN DISTRICT OF CALIFORNIA 6 7 POPPI METAXAS, Case No. 20-cv-01184-EMC

8 Plaintiffs, ORDER GRANTING IN PART AND 9 v. DENYING IN PART DEFENDANT’S MOTION TO DISMISS 10 GATEWAY BANK, F.S.B., et al., 11 Defendant. Docket No. 127

12 13 This is an ERISA denial of benefits case involving whether Plaintiff is entitled to benefits 14 under the terms of a supplemental executive retirement plan. Plaintiff was the President and Chief 15 Executive Officer for Defendant Gateway Bank prior to her disability and was a beneficiary of 16 supplemental retirement benefits under it. Plaintiff brings against Defendant three claims of (1) a 17 denial of benefits claims under ERISA §502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B); (2) breach of 18 duty of good faith under ERISA §502(a)(3), 29 U.S.C. § 1132(a)(3N); and (3) failure to produce 19 required documents under ERISA §502(a)(1)(A), 29 U.S.C. § 1132(c). 20 Now pending is the Defendant’s motion to dismiss Plaintiff’s complaint pursuant to Fed. 21 R. Civ. P. 12(b)(6) for failure to state a claim. Docket No. 119. For the following reasons, the 22 Court GRANTS IN PART AND DENIES IN PART Defendant’s motion to dismiss the denial of 23 benefits claim without prejudice with leave to amend. The Court GRANTS Defendant’s motion 24 to dismiss Plaintiff’s claim for equitable relief with leave to amend. The Court GRANTS 25 Defendant’s motion to dismiss claim for failure to produce documents without prejudice and with 26 leave to amend. 27 1 I. FACTUAL AND PROCEDUAL BACKGROUND 2 The Plaintiff’s alleged facts are as follows. Plaintiff was President and CEO of Defendant 3 Gateway Bank. Docket No. 113 (“SC”) ¶ 8. In 2004, in return for Plaintiff’s agreement to remain 4 its CEO, Defendant agreed to increase Plaintiff’s compensation by approximately $300,000 per 5 year in the form of deferred compensation. Id. ¶ 9. Over the next seven years as part of the 6 deferred compensation, Defendant purchased a $5 million life insurance policy (“Policy”) from an 7 insurance company, NY Life, on Plaintiff’s life that would fund a customized Supplemental 8 Executive Retirement Plan (“PLAN.”). The PLAN started in January 2005. 9 The PLAN offered Disability and Termination benefits to certain key employees of the 10 Bank, including Plaintiff. Id. ¶ 18. Around the inception of the PLAN, Defendant created three 11 accounts in its general ledger that related to the accounting of Defendant’s PLAN benefit 12 obligation to Plaintiff and/or Plaintiff’s deferred compensation used to purchase the Policy. Id. ¶ 13 20. As of March 2010, Defendant’s general ledger carried a liability for Plaintiff’s PLAN benefits 14 of $1,236,448.04. Id. ¶¶ 26. As of June 2010, the cash value of the Policy was $1,867,581. Id. ¶¶ 15 26, 27. In April 2010, Defendant derecognized the accrued liability of Plaintiff’s PLAN benefit on 16 the Defendant’s general ledger. Id. ¶ 28. The value of PLAN benefits ($1,236,448.04) added to 17 Defendant’s general ledger and increased Defendant’s capital. Id. ¶ 29. 18 In March 2013, Plaintiff filed a claim for Disability and Termination benefits to Defendant. 19 Id. ¶ 37. On February 25, 2016, Defendant denied Plaintiff’s claim. Id. ¶ 38. During the 20 pendency of her claim, Plaintiff requested multiple times that Defendant produce certain 21 documents to which she was entitled pursuant to ERISA, the applicable Department of Labor 22 regulations, and the terms of the PLAN. Id. ¶ 39. In August 2016, Plaintiff appealed Defendant’s 23 denial. In May 2017, Defendant’s Administrative Committee upheld the decision to deny 24 Plaintiff’s benefit. Id. ¶¶ 40-41. 25 In February 2020, Plaintiff filed an initial Complaint in this court seeking plan benefits 26 pursuant to ERISA §502(a)(1)(B) and equitable relief pursuant to ERISA §502(a)(3). Id. ¶ 42. In 27 August 2022, the Court issued an order at summary judgment remanding the matter to 1 under the terms of the PLAN. Docket No. 90. In March 2023, Defendant’s Administrative 2 Committee, after reconsidering Plaintiff’s claim for Termination benefit, under Section 5.3(b) of 3 the PLAN, found she was entitled to $9.252.95 per month since Plaintiff’s retirement date on May 4 1, 2013. Id. ¶ 62. 5 In May 2023, Plaintiff again filed an appeal of Administrative Committee decision that 6 addressed (1) the correct amount of past and future benefits due, which she argues should be at 7 least $19,626.16 per month; (2) interests on back benefits due for the past thirteen years; and (3) 8 the failure to produce documents and information relevant to Plaintiff’s claim. Id. ¶¶ 63, 75. In 9 June 2023, Defendant issued checks for the benefits, although various taxes were withheld on the 10 checks and Defendant allegedly failed to specify withholding information as require by California 11 Labor Code § 226, et seq. Id. ¶ 65. 12 Then, in March 2024, the Court reopened the case pursuant to Rule 60(b)(6) and granted 13 Plaintiff leave to amend to file a Supplemental Complaint. Docket No. 112. Plaintiff’s 14 Supplemental Complaint addresses post-remand issues. Plaintiff now bring three claims against 15 Defendant: (1) failure to pay benefits due in violation of ERISA § 502(a)(1)(B), 29 U.S.C. § 16 1132(a)(1)(B); (2) equitable relief from breach of duty of good faith under ERISA § 502(a)(3), 29 17 U.S.C. § 1132(a)(3); and (3) failure to produce documents under ERISA § 502(a)(1)(A), 29 U.S.C. 18 § 1132(c). See SC. Plaintiff seeks damages, equitable damages and punitive damages. Id. ¶¶ 18- 19 19. Defendant now moves to dismiss the SC under Fed. R. Civ. P. 12(b)(6). See Docket No. 119 20 (“Mot.”). 21 II. LEGAL STANDARD 22 A. Failure to State a Claim (Rule 12(b)(6)) 23 Federal Rule of Civil Procedure 8(a)(2) requires a complaint to include “a short and plain 24 statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). A 25 complaint that fails to meet this standard may be dismissed pursuant to Rule 12(b)(6). See Fed. R. 26 Civ. P. 12(b)(6). To overcome a Rule 12(b)(6) motion to dismiss after the Supreme Court’s 27 decisions in Ashcroft v. Iqbal, 556 U.S. 662 (2009) and Bell Atlantic Corporation v. Twombly, 550 1 claim has at least a plausible chance of success.’” Levitt v. Yelp! Inc., 765 F.3d 1123, 1135 (9th 2 Cir. 2014). The Court “accept[s] factual allegations in the complaint as true and construe[s] the 3 pleadings in the light most favorable to the nonmoving party.” Manzarek v. St. Paul Fire & 4 Marine Ins. Co., 519 F.3d 1025, 1031 (9th Cir. 2008). But “allegations in a complaint . . . may not 5 simply recite the elements of a cause of action [and] must contain sufficient allegations of 6 underlying facts to give fair notice and to enable the opposing party to defend itself effectively.” 7 Levitt, 765 F.3d at 1135 (quoting Eclectic Props. E., LLC v. Marcus & Millichap Co., 751 F.3d 8 990, 996 (9th Cir. 2014)). “A claim has facial plausibility when the Plaintiff pleads factual 9 content that allows the court to draw the reasonable inference that the Defendant is liable for the 10 misconduct alleged.” Iqbal, 556 U.S. at 678. “The plausibility standard is not akin to a 11 ‘probability requirement,’ but it asks for more than a sheer possibility that a defendant has acted 12 unlawfully.” Id. (quoting Twombly, 550 U.S. at 556). 13 III. DISCUSSION 14 A. Claim 1: PLAN Benefit 15 ERISA § 502(a)(1)(B) provides that a plan participant may bring a civil action “to recover 16 benefits due to him under the terms of his plan; to enforce his rights under the terms of the plan, or 17 to clarify his rights to future benefits under the terms of the plan.” ERISA § 502(a)(1)(B), 29 18 U.S.C. § 1132(a)(1)(B). To state a claim for denial of benefits under ERISA, a plaintiff must 19 allege plausible facts showing they were owed benefits under the …Plan. This requires a plaintiff 20 to allege (1) the existence of an ERISA plan, and to identify (2) “the provisions under the plan that 21 entitle [them] to benefits.” Doe One v. CVS Pharmacy, Inc., 384 F. Supp. 3d 967, 992 (N.D. Cal. 22 2018) (citing B.R. v. Beacon Health Options, No. 16-cv-04576-MEJ, 017 U.S. Dist. LEXIS 23 194501, 2017 WL 5665667, at *3 (N.D. Cal. Nov. 27, 2017)). See also Steelman v. Prudential 24 Ins. Co. of Am. 2007 U.S. Dist. LEXIS 30149 (E.D. Cal. Apr. 4, 2017) (Ruling that a plaintiff who 25 brings a claim for benefits under ERISA must identify a specific plan term that confers the benefit 26 in question.). A plan is established if a reasonable person “can ascertain the benefits, a class of 27 beneficiaries, the source of financing, and procedures for receiving benefits.” Donovan v. 1 Here, Plaintiff clearly has stated a claim for denial of benefits under ERISA for two 2 reasons. First, her allegations sufficiently establish both the existence of an ERISA plan and 3 identify the relevant provisions. Plaintiff alleges that “the Gateway Bank Supplemental Executive 4 Retirement Plan (hereinafter the “SERP” of the “PLAN”) was an employee benefit plan within the 5 meaning of ERISA § 3(1) (29 U.S.C. §1002(1)), sponsored by Defendant Gateway…” SC ¶ 5. 6 She then alleges that the PLAN offered Plaintiff Disability and Termination benefits, id. ¶¶ 18-19, 7 that she filed a claim for Disability and Termination benefits in March 2013, and that Defendant 8 denied her claim in February 2016. Id. ¶¶ 37-38. 9 In contrast, in Doe One v. CVS Pharmacy Inc., 348 F. Supp. 3d 967, 993 (N.D. Cal. 2018), 10 aff’d in part, vacated in part, remanded sub nom, Doe v. CVS Pharmacy, Inc., 982 F.3d 1204 (9th 11 Cir. 2020), this Court dismissed a denial of benefits claim because plaintiffs failed to identify any 12 specific term in their plan that conferred the benefits they were allegedly denied. There, Plaintiff 13 argued in broad language that they were “entitled to prescription medication benefits under the 14 terms of their plan,” but they were unable to point to any allegations specifying which term under 15 the plan entitled them to such a benefit. Id. at 992. See also Black v. Greater Bay Bancorp Exec. 16 Supplemental Comp. Benefits Plan, No. 16-cv-00486-EDL, 2016 U.S. Dist. LEXIS 197555, 2016 17 WL 11187255, at *19 (N.D. Cal., July 25, 2016) (finding that although the plaintiff referred to 18 general plan summary and other broad allegations on violating plan terms, their allegation was 19 insufficient to support their benefit claim because they failed to allege specific provision of the 20 plan.); Forest Ambulatory Surgical Assocs., L.P. v. United Healthcare ins. Co., No. 10-CV- 21 04911-EJD, 2011 WL 2748724, at*15 (N.D. Cal. July 13, 2011) (“[C]onclusory allegations are 22 insufficient to meet the Twombly and Iqbal pleading standards … allegations must be sufficient to 23 raise the existence of an ERISA plan above [a] speculative level.”). 24 Unlike the broad, conclusory allegations of a denial of benefits in Doe One, Black, and 25 Forest Ambulatory, here, Plaintiff has identified not only the Gateway Bank Supplemental 26 Executive Retirement Plan (the “PLAN”) but also specifically the Disability and Termination 27 benefits provisions within the PLAN under Section 5.3(b) of the PLAN and alleges that those 1 Section 5.3(b) reads:

2 if a Participant’s employment terminates prior to the participant’s Retirement Date under any other circumstances that those described 3 in section 5.3(a) (employment terminates for Good Reason within twenty-four months following a Change in Control), the benefit 4 payable, in lieu of any other benefit under this Article V, shall be the Participants’ Accrued Benefit determined on the date of termination. 5 Therefore, Plaintiff successfully alleges the PLAN term that entitles her of Termination Benefits. 6 Secondly, the Defendant’s PLAN Administrative Committee even found on remand that 7 Plaintiff was entitled to Termination benefits under Section 5.3(b) of the PLAN in the amount of 8 $9,252.95 per month commencing on her retirement date of May 1, 2013. SC ¶ 62. Defendant 9 was clearly aware of a specific provision that entitled Plaintiff to benefits and conceded that she 10 was entitled to a specific amount. Thus, it is simply implausible that Defendant was not on notice 11 of Plaintiff’s claim that she is entitled to relief under the PLAN. 12 Plaintiff also alleges that she is entitled to (1) improper tax withholding, (2) interest on all 13 back benefits due, (2) financial costs as a result of having the benefit withheld, and (3) the amount 14 of increased taxes she will have pay due to having the benefit withheld for thirteen-years. SC ¶ 75 15 (E)—(H). However, Plaintiff fails to allege any PLAN terms or statute that entitles her to interest 16 and tax withholding on top of the PLAN benefits, and thus she does not sufficiently plead the 17 benefits claim. See Kopelev v. Boeing Co., No. LACV 20-05805-VAP (KSx), 2021 U.S. Dist. 18 LEXIS 110104 (C.D. Cal. June 9, 2021) (dismissing plaintiff’s claim for benefits because plaintiff 19 has not cited any authority to show, nor is the Court aware of any, that the recovery of a tax 20 withholding is a Plan “benefit” to which she is entitled as a beneficiary.) 21 Therefore, the Court DENIES IN PART dismissal of Plaintiff’s claim for PLAN benefit. 22 The Court GRANTS dismissal of Plaintiff’s claim to interest and tax withholding with leave to 23 amend. Plaintiff should amend her complaint to include statutory basis, ERISA provision, or 24 PLAN terms that entitles her to the interest and tax withholding benefits on top of the Termination 25 Benefit. 26

27 1 B. Claim 2: Equitable Relief 2 Plaintiff also seeks equitable relief for Defendant’s alleged breach of duty of good faith 3 under ERISA § 502(a)(3) and the general good faith standard under contract law. Here, Plaintiff 4 seeks an equitable lien on Defendant’s general assets; a constructive trust on the cash value of the 5 New York Life Insurance Policy which informally funds the SERP; an order requiring Defendant 6 to “properly account for all SERP related funds”; an injunction to prevent Defendant from altering 7 the New York Life Insurance Policy; the appointment of an independent trustee to administer the 8 SERP; disgorgement of profits from derecognition and elimination of SERP liability; interest and 9 financing costs; and a monetary award in the amount of increased taxes she must pay associated 10 with SERP benefits. SC ¶ 95(1)-(8)). 11 ERISA §502(a)(3) states:

12 A civil action may be brought… (3) by a participant, beneficiary, or fiduciary (A) …or (B) to obtain other appropriate equitable relief (i) 13 to redress [any act or practice which violates any provision of Title I of ERISA or the terms of the plan] 14 or (ii) to enforce any provisions of this subchapter or the terms of the plan. 15 29 U.S.C. § 1132(a)(3). § 502(a)(3) does not, however, “authorize ‘appropriate equitable relief’ at 16 large, but only ‘appropriate equitable relief’ for the purpose of ‘redress[ing any] violations or . . . 17 enforc[ing] any provisions of ERISA or an ERISA plan.’” Harris Tr. & Sav. Bank v. Salomon 18 Smith Barney, inc., 530 U.S. 238, 246 (2000). 19 Plaintiff’s claim of equitable relief fails for the reasons below. 20 1. Fiduciary Duties 21 Plaintiff first alleges that Defendant owed her a duty of good faith and fair dealing under 22 the express terms of the PLAN because Defendant is a party to the PLAN Agreement, the plan 23 sponsor, plan administrator, and fiduciary of the Gateway Bank and shareholders. SC ¶ 78. 24 However, Plaintiff concedes that as a “top-hat” plan, the PLAN is exempted from ERISA 25 fiduciary duties. Oppo. at 9. See also Gilliam v. Nevada Power Co., 488 F.3d 1189, 1193 (“Top- 26 hat plans form a rare sub-species of ERISA plans, and Congress created a special regime to cover 27 them.”). A top-hat plan is a plan “which is unfunded and is maintained by an employer primarily 1 for the purpose of providing deferred compensation for a selected group of management or highly 2 compensated employees.” ERISA § 401(a), 29 U.S.C. § 1001(a); Gilliam v. Nevada Power Co., 3 488 F. 3d 1189, 1192-93 (9th Cir, 2007). ERISA exempts such plans “from the 4 fiduciary, funding, participation, and vesting requirements applicable to other employee benefit 5 plans.” Duggan v. Hobbs, 99 F.3d 307, 310 (9th Cir. 1996); 29 U.S.C. § 1001(a). 6 The first question is whether the Plaintiff can bring an ERISA claim against a non- 7 fiduciary. Harris Trust & Sav. Bank v. Salomon Smith Barney, Inc., 530 U.S. 238, 245-57 (2000) 8 holds that plaintiff can bring an ERISA § 502(a)(3) claim against a non-fiduciary who knowingly 9 participates in the fiduciary’s violation of ERISA, but its liability is limited to appropriate 10 equitable relief. See id; See also LD v. United Behavioral Health, 508 F. Supp. 3d 583 (N.D. Cal. 11 2020) (finding that a nonfiduciary defendant who knowingly participated in the fiduciary 12 defendant’s action in misleading plaintiff’s health insurance calculation as a proper defendant for 13 plaintiff’s equitable relief claim pursuant to ERISA §502(a)(3).). 14 Here, the PLAN fiduciary is the administrative committee of Gateway. See Docket No. 15 119-2 at PDF 10, Exh. 1, Section 7.1 (“SERP is administered by an Administrative Committee 16 consisting of no less than three persons appointed by the Board of Directors of Gateway Bank.”). 17 However, since the administrative committee consist of no less than three persons appointed by 18 Defendant’s Board, given the overlap in membership, Defendant arguably was aware of the 19 Administrative Committee’s conduct and their breach of the PLAN term. Id. The Court assumes 20 arguendo that the knowledge element of non-fiduciary duty is met. However, for the reason set 21 forth below, no ERISA claim for equitable relief against Defendant is stated 22 To state a § 502(a)(3) claim against a non-fiduciary, Plaintiff must allege that Defendant 23 (1) commit a remediable wrong, i.e., that the plaintiff seeks relief to redress a violation of ERISA 24 or the terms of the plan, and (2) the relief sought is appropriate equitable relief. Gabriel v. Alaska 25 Elec. Pension Fund, 773 F.3d 945, 954 (9th Cir. 2014); Gamino v. Spcp Grp., LLC, No. 5:21-cv- 26 01466-SB-SHK, 2022 U.S. Dist. LEXIS 21799, at*9 (C.D. Cal. Feb. 2, 2022). Plaintiff has 27 successfully alleged the remediable wrong. However, she fails to establish that the relief she seeks 1 2 a. Remediable wrong 3 As for the first element, Plaintiff adequately alleged a violation of ERISA and specifically 4 identified the relevant provisions in the PLAN that entitle her to benefits, for the reasons stated 5 earlier. 6 b. Appropriate equitable relief 7 As for the second element, “appropriate equitable relief” refers to “those categories of 8 relief that traditionally (i.e., prior to the merger of law and equity) were typically available in 9 equity.” CIGNA Corp.v. Amara, 563 U.S. 421 (2011). The Supreme Court has identified three 10 traditional equitable remedies that may be available under § 502(a)(3): (1) reformation of the 11 terms of the plan when there is evidence of a mistake of fact or law that affected the terms of the 12 instrument, (2) equitable estoppel holding the fiduciary to “what it had promised” and the person 13 entitled to benefits “in the same position he would have been in had the representations been true,” 14 and (3) surcharge or monetary “compensation.” Id. at 443. 15 Here, Plaintiff seeks additional monetary relief beyond the PLAN benefits. What she 16 seeks amounts to an equitable surcharge against Defendant to compensate her for the financial 17 losses over and above her PLAN benefit as the consequence of Defendant’s breach. SC ¶ 93. 18 Equitable surcharge is relief in the form of monetary “compensation” for a loss resulting from a 19 trustee's breach of duty or to prevent the trustee's unjust enrichment – essentially what Plaintiff 20 seeks here. CIGNA Corp.v. Amara, 563 U.S. at 442 (2011). Unjust enrichment occurs when a 21 trustee (or a fiduciary) gains a benefit by breaching his or her duty. Gabriel v. Alaska Elec. 22 Pension Fund, 773 F.3d 945, 958 (9th Cir. 2014). However, a claim for equitable surcharge lies 23 only against a fiduciary. As noted in Amara., where the plan participants sues a defendant who 24 was not a trustee, the asserted “make-whole relief” (otherwise characterized as a surcharge) 25 constitutes compensatory damages which “traditionally speaking, was legal, not equitable, in 26 nature.” CIGNA Corp.v. Amara, 563 U.S. at 442 (2011); See Mertens v. Hewitt Associates, 508 27 U.S. 248, 250, 262-63 (1993) (finding that ERISA does not authorize suits for money damages 1 because plaintiff sought legal relief (compensatory damage) instead of appropriate equitable 2 relief). 3 Plaintiff also alleges that she is entitled to interest, financial costs, and compensation for 4 the increased taxes due to the withheld benefit. SC ¶ 95 (7), (8). However, the statutory provision 5 explicitly authorizing a beneficiary to bring an action to enforce his rights under the plan—§ 6 502(a)(1)(B)—says nothing about the recovery of extracontractual damages, even if there is a 7 delay in processing a disputed claim. Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 8 105 (1985). 9 Plaintiff tries to allege that even without a fiduciary duty, Defendant still owes her a 10 general duty of good faith under contract law. Oppo. at 10, 11. She cites Buster v. Comp. Comm, 11 of the Bd. Of Dirs. Of Mechanics Bank 2016 WL 4492577 (N.D. Cal. 2016) (finding that although 12 the defendant had no fiduciary duties to the plaintiff, plaintiff’s equitable relief claim stands 13 because defendant’s breach of contract thus breached the general duty of good faith in contract 14 law.). However, Buster is distinguishable. Id. In Buster, the plaintiff sought equitable 15 reformation and estoppel regarding the retirement agreement the defendant made. Id. at 11. This 16 Court granted the relief because they found the Agreement was misrepresented and the defendant 17 “cheat[ed] a retiree.” Id. at 14. 18 Here, Plaintiff does not allege any misrepresenting or misleading action in the PLAN from 19 Defendant, and Plaintiff seeks equitable surcharge, instead of reformation and estoppel. In the 20 Supplemental Briefing, Plaintiff failed to provide additional cases that support her use of duty of 21 good faith in contract law for top-hat plans under ERISA sufficient to support a claim for 22 equitable relief as sought here. Docket No. 126. (“SP”). Therefore, the duty of good faith is not 23 an appropriate basis to grant an equitable surcharge. 24 The Court GRANTS Defendant’s motion to dismiss the claim for equitable relief with 25 leave to amend. Plaintiff may amend the complaint to assert other equitable relief, if applicable. 26 C. Claim 3: Failure to produce required documents 27 Plaintiff seeks penalties under ERISA § 502(a)(1)(A) [§ 1132(c)(1).] A civil action may be brought . . . by a participant or beneficiary . . . 1 for the relief provided for in subsection (c) of this section.

2 Section 502(c) allows a court in its discretion to provide penalties against any administrator “who 3 fails to . . . comply with a request for any information which such administrator is required by this 4 subchapter to furnish to a participant . . . in the amount of up to $100 a day from the date of such 5 failure or refusal.” 29 U.S.C. § 1132(c); see also Kurisu v. Svenhard Swedish Bakery 6 Supplemental Key Mgmt. Ret. Plan, No. 20-cv-06409-EMC, 2021 U.S. Dist. LEXIS 142823, 7 at*25 (N.D. Cal. July 30, 2021). Further, a valid request for documents under Section 502(c) must 8 give the plan administrator “clear notice of what information the beneficiary desires.” Anderson v. 9 Flexel, Inc., 47 F.3d 243, 248 (7th Cir. 1995). 10 Here, Plaintiff alleges that Defendant failed to produce the documents she requested, 11 including documents regarding Defendant’s merger with Royal Business Bank, further evidence 12 for the SERP Committee’s review of her benefits claim, and other relevant documents. SC ¶¶ 46- 13 7, 50. Plaintiff alleges that Defendant produced three (3) of the documents requested, but she 14 failed to specify what they were. Id. at 52. Defendant makes two counterarguments. First, they 15 are not the proper defendant, and second, Plaintiff does not allege they improperly withheld plan 16 documents in violation of ERISA. See Mot. at 13-5. 17 1. Proper Defendant 18 Defendant argues that it is not a proper party under Section 502(c) because the company is 19 not an administrator of the PLAN. Mot. ¶ 14. 20 Penalties under Section 502(c)(1) can only be asserted against the Plan Administrator. 21 Sgro v. Danone Waters of N. Am., Inc., 532 F.3d 940, 945; see also Moran v. Aetna Life Ins. Co., 22 872 F.2d 296, 299 (9th Cir. 1989) (finding that court should strictly apply § 502(c) statutory 23 penalties to those who fall within the explicit definition of plan administrator.). 24 ERISA defines a plan administrator as: 25 (i)the person specifically so designated by the terms of the 26 instrument under which the plan is operated; (ii) if an administrator is not so designated, the plan sponsor; or (iii) 27 in the case of a plan for which an administrator is not 1 29 U.S.C. § 1002(16)(A); Castillo v. Cmty. Child Care Council of Santa Clara Cnty., Inc., No. 17- 2 cv-07243-SVK, 2018 U.S. Dist. LEXIS 88061, at*32 (N.D. Cal. May 24, 2018). An 3 “administrator” is typically the person or entity designated as such in the documents governing the 4 ERISA plan. ERISA § 3(16), 29 U.S.C. § 1002(16). Further, The Ninth Circuit has “effectively 5 closed the door” on claims asserting liability based on the defendant being a de facto administrator 6 –a party not named in the plan as an administrator but exercises administrative functions regarding 7 the plans. Ford v. MCI Commc'ns Corp. Health & Welfare Plan, 399 F.3d 1076, 1081-82 (9th 8 Cir. 2005). When plans have designated administrators, courts have rejected extending plan 9 administrator liability beyond that designated administrator. See e.g. Castillo v. Cmty. Child Care 10 Council of Santa Clara Cty., Inc., No. 17-cv-07243-SVK, 2018 U.S. Dist. LEXIS 88061, at *34 11 (N.D. Cal. May 24, 2018). 12 The PLAN documents clearly state the PLAN administrator is the administrative 13 committee consisting of more than three Board-appointed persons. Docket No. 119-2 at PDF 10, 14 Exh. 1, Section 7.1 (“SERP is administered by an Administrative Committee consisting of no less 15 than three persons appointed by the Board of Directors of Gateway Bank.”). See Fenwick v. 16 Merril Lynch & Co., 2007 U.S. Dist. LEXIS 15122 at *6-7 (D. Conn.) (finding that named 17 companies were not proper defendants because the plan “unambiguously designates the 18 Committee as the plan administrator”). 19 The Court GRANTS Defendant’s motion to dismiss the claims against Defendant without 20 prejudice and gives Plaintiff leave to amend the complaint to name the proper defendant. 21 2. Plaintiff’s Request 22 Plaintiff alleges that Defendant failed to produce requested documents relevant to the 23 PLAN and Plaintiff’s benefits in violation of ERISA § 502(c). 24 ERISA provides remedies for a plan administrator's failure to comply with a request by a 25 participant or a beneficiary for certain plan information. ERISA § 502(a)(1)(A), (c), 29 U.S.C. § 26 1132(a)(1)(A), (c). Specifically, a plan administrator has thirty days to respond to the written 27 request of a plan participant or beneficiary to furnish a copy of the latest summary plan description 1 or other plan documents. ERISA also requires plan administrators to furnish with a plan 2 participant or beneficiary a statement of accrued benefits if they request one in writing. ERISA § 3 105(a), 29 U.S.C. § 1021(a). Failure to respond to a written request for such information can 4 subject an employer to a fine of $ 110 for each day that the employer fails to respond. 29 C.F.R. § 5 2575. 6 As an initial matter, the Court thus does not consider Plaintiff’s requests made three years 7 before the filing of the initial complaint in February 2020 because they fall outside the statute of 8 limitations. ERISA contains no limitations period for actions to recover penalties for failure to 9 furnish plan documents under § 502(c), 29 U.S.C.A. § 1132(c). Wilson v. Garcia, 471 U.S. 261, 10 266–67 (1985). Federal courts have therefore borrowed state limitations periods for penalties that 11 are created by statute. The court in California, an ERISA § 502(c) claim has a three-year statute of 12 limitations. Anderson v. Intel Corp. Inv. Policy Comm., 602 F. Supp. 3d 1238 (N.D. Cal. 2022) 13 (finding that a three-year limitations period, by contrast, applies to actions “upon a liability created 14 by statute, other than a penalty.”). Cal. Civ. Proc. Code § 338(a). Plaintiff does not contest the 15 statute of limitations in the Opposition. See Oppo. 16 Next, Plaintiff made three requests in 2022 to Defendant for documents regarding (1) 17 Gateway’s merger with Royal Business Bank as it relates to what entity would be liable to 18 Plaintiff for her benefits due, (2) information relating to various insurance claims of Gateway, and 19 (3) unspecified documents that are “relevant to her claims.” See SC ¶¶ 47-50. 20 However, Plaintiff fails to allege a specific ERISA provision that requires Defendant to 21 produce the requested documents. In LD v. United Behavioral Health, this Court dismissed the 22 plaintiff’s claim under § 502(c) because although the plaintiff cited the disclosure requirement of 23 29 U.S.C. § 1024(4) and 1022, his request that defendants disclose their methodology to calculate 24 reimbursements did not fall within that provision or any other alleged provision. 2020 U.S. Dist. 25 LEXIS 155224 at *13-14 (N.D. Cal. Aug. 26, 2020). There, the alleged ERISA disclosure 26 provisions § 1024(4) and 1022 required a plan administrator to disclose, upon request, a summary 27 plan description and other plan documents such as an annual report, a terminal report, a bargaining 1 operated. Id. 2 Here, Plaintiff has alleged that Section 8.3 of the PLAN provides that a claimant may 3 examine “pertinent documents.” SC ¶ 98. 4 Section 8.3 reads:

5 Any person whose claim or request is denied or who has not received a response within 30 days may request a review by notice 6 given in writing to the Committee. The claim or request shall be reviewed by the Committee who may, but shall not be required to, 7 grant the claimant a hearing. On review, the claimant may have representation, examine the pertinent documents, and submit issues 8 and comments in writing. 9 However, Plaintiff does not allege any specific ERISA provision that requires Defendant to 10 disclose the documents she requested besides the PLAN term, and the PLAN term did not include 11 any reference to ERISA. Id. Plaintiff is therefore given leave to amend her complaint to allege a 12 specific ERISA provision that requires Defendant to disclose the information she requested about 13 Gateway’s merger with Royal Business Bank and which entity would be liable to her for benefits 14 due. 15 To the extent that Plaintiff alleges Defendant failed to disclose additional requested 16 documents that are “relevant to her claim,” (SC ¶ 46), she is also given leave to amend her 17 complaint to allege with further specificity the types of documents she requested and the specific 18 ERISA provision that would govern the disclosure of those documents. See 29 U.S.C. § 19 1024(a)(6) (Providing that an administrator shall, upon written request of any participant or 20 beneficiary, furnish a copy of the latest updated summary, plan description, and the latest annual 21 report, any terminal report, the bargaining agreement, trust agreement, contract, or other 22 instruments under which the plan is established or operated.). See also 29 CFR § 2520.104b-1. 23 (Providing that the plan administrator must furnish certain material to individual participants and 24 beneficiaries upon their request, plan summaries, the latest annual report, and the bargaining 25 agreement, trust agreement, contract, or other instruments under which the plan is established or 26 operated available at all times in their principal offices.). 27 Therefore, the Court GRANTS Defendant’s motion to dismiss Plaintiff’s claim for failure 1 that Defendant is the PLAN administrator but should be given leave to amend the complaint to 2 name the proper defendants. Plaintiff has also not sufficiently alleged that she requested 3 Defendant to provide documents which are required to be disclosed under ERISA, but should be 4 given leave to amend the complaint to identify documents requested and which specific ERISA 5 provision governs each such request. 6 IV. CONCLUSION 7 For the reasons above, the Court GRANTS IN PART AND DENIES IN PART 8 Defendant’s motion to dismiss the denial of benefits claim with leave to amend. It also GRANTS 9 Defendant’s motion to dismiss the claim for equitable relief with leave to amend. The Court 10 GRANTS Defendant’s motion to dismiss the breach of the duty of good faith in contract claim 11 with leave to amend. The Court GRANTS Defendant’s motion to dismiss the claim for failure to 12 produce ERISA required documents with leave to amend.

13 14 IT IS SO ORDERED. 15 16 Dated: July 18, 2024 17 18 ______________________________________ 19 EDWARD M. CHEN United States District Judge 20

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