23-247 Spillane v. N.Y.C. Dist. Council of Carpenters
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
SUMMARY ORDER RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
1 At a stated term of the United States Court of Appeals for the Second Circuit, 2 held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of 3 New York, on the 22nd day of January, two thousand twenty-four. 4 5 PRESENT: 6 MICHAEL H. PARK, 7 EUNICE C. LEE, 8 SARAH A. L. MERRIAM, 9 Circuit Judges. 10 __________________________________________ 11 12 Patrick Brendan Spillane, Debra Spillane, AKA 13 Deborah Spillane, 14 15 Plaintiffs-Appellants, 16 17 v. 23-247 18 19 New York City District Council of Carpenters 20 and Joiners of America, New York City District 21 Council of Carpenters Pension Fund, New York 22 City District Council of Carpenters Welfare 23 Fund, Joseph A. Geiger, as Trustee, Eddie 24 McWilliams, Kristin O’Brien, as Executive 25 Director of the New York City District Council of 26 Carpenters Benefit Funds, 27 28 Defendants-Appellees. * 29 __________________________________________ 30
* The Clerk of Court is respectfully directed to amend the caption accordingly. 1 FOR APPELLANTS: ROBERT K. ERLANGER, Erlanger Law Firm, PLLC, 2 New York, NY. 3 4 FOR UNION APPELLEES: GILLIAN COSTELLO (James M. Murphy on the brief), 5 Spivak Lipton LLP, New York, NY. 6 7 FOR FUND APPELLEES: MARTY GLENNON (John H. Byington, III on the 8 brief), Archer, Byington, Glennon & Levine, LLP, 9 Melville, NY. 10 11 Appeal from a judgment of the United States District Court for the Southern District of
12 New York (Torres, J.).
13 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND
14 DECREED that the judgment of the district court is AFFIRMED.
15 Plaintiff Patrick Brendan Spillane is a retired, dues-paying carpenter of New York City
16 District Council of Carpenters and Joiners of America (the “Union”). He and his beneficiary,
17 Debra Spillane (his wife), sued the Union, the Union’s Director of Area Standards Eddie
18 McWilliams, New York City District Council of Carpenters Pension Fund (the “Pension Fund”),
19 New York City District Council of Carpenters Welfare Fund (the “Welfare Fund”) (collectively,
20 the “Funds”), Joseph A. Geiger as Trustee of the Funds, and Kristin O’Brien as Executive Director
21 of the Funds. Plaintiffs allege that the Funds improperly terminated his pension and welfare
22 benefits following a Union trial at which Spillane was convicted of working as a carpenter for a
23 non-union company, Anfield Interiors, Inc. Spillane brought claims against the Union for
24 violating the Labor-Management Reporting and Disclosure Act (“LMRDA”) under 29 U.S.C. §§
25 411(a), 412, and 529; against the Funds for denial of benefits and breach of fiduciary duties under
26 the Employment Retirement Income Security Act of 1974 (“ERISA”) § 502(a)(1)(B), 29 U.S.C.
27 § 1132(a)(1)(B), and § 502(a)(3), 29 U.S.C. § 1132(a)(3), respectively; and against McWilliams
28 for prima facie tort under New York law. The district court determined that it had jurisdiction 2 1 under 29 U.S.C. § 412, deemed the LMRDA claim under 29 U.S.C. § 529 to be abandoned,
2 declined to exercise supplemental jurisdiction over the prima facie tort claim, and dismissed the
3 remaining causes of action for failure to state a claim. Spillane now appeals the district court’s
4 dismissals of his LMRDA claim under 29 U.S.C. § 411(a) and the ERISA claims. We assume
5 the parties’ familiarity with the underlying facts, the procedural history of the case, and the issues
6 on appeal.
7 “We review de novo the dismissal of a complaint pursuant to Fed. R. Civ. P. 12(b)(6),
8 accepting the alleged facts as true and drawing all reasonable inferences in plaintiffs’ favor.”
9 Allen v. Credit Suisse Secs. (USA) LLC, 895 F.3d 214, 222 (2d Cir. 2018).
10 I. LMRDA Claim
11 The district court properly dismissed Spillane’s unexhausted LMRDA claim against the
12 Union. See Paulino v. N.Y. Printing Pressman’s Union, Local Two, 301 F. App’x 34, 38 (2d Cir.
13 2008) (citing Maddalone v. Local 17, United Bhd. of Carpenters & Joiners of Am., 152 F.3d 178,
14 186 (2d Cir. 1998) (“The requirement that a plaintiff exhaust internal union remedies under the
15 LMRDA lies within the court’s discretion.”). LMRDA § 101(a)(4) states that a Union member
16 “may be required to exhaust reasonable hearing procedures . . . before instituting legal or
17 administrative proceedings” against the Union or its officers. 29 U.S.C. § 411(a)(4). In
18 determining whether to require a party to exhaust internal remedies, courts look to (1) “whether
19 union officials are so hostile to the employee that he could not hope to obtain a fair hearing on his
20 claim”; (2) “whether the internal union appeals procedures would be inadequate either to reactivate
21 the employee’s grievance or to award him the full relief he seeks”; and (3) “whether exhaustion of
22 internal procedures would unreasonably delay the employee’s opportunity to obtain a judicial
23 hearing on the merits of his claim.” Howd v. United Food & Com. Workers Union, Local 919,
3 1 383 F. App’x 38, 40 (2d Cir. 2010) (quoting Maddalone, 152 F.3d at 186). Spillane does not
2 contend that he exhausted his available remedies after being convicted at the Union trial. 2
3 Additionally, he has not shown that the Union officials were hostile to him, that the Union appeal
4 procedures were inadequate, or that abiding by Union procedures would unreasonably delay his
5 opportunity to be heard in court.
6 Spillane now argues that exhausting administrative remedies would have been futile
7 because of the district council’s hostility towards him and Anfield; the bias of a “crony [Trial
8 Committee] and ineffectual Trial Chair”; and the fact that his similarly situated fellow carpenter
9 Fitzsimons “exhausted his internal remedies to no avail.” Appellants’ Br. at 31-32. His claims
10 of futility, however, are speculative and insufficient to show that pursuing an administrative appeal
11 would have been futile.
12 Spillane failed to exhaust administrative remedies or to show that doing so would have
13 been futile, so we affirm the district court’s dismissal of Spillane’s LMRDA claim.
14 II. ERISA Claims
15 1. ERISA § 502(a)(1)(B), Denial of Benefits
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23-247 Spillane v. N.Y.C. Dist. Council of Carpenters
UNITED STATES COURT OF APPEALS FOR THE SECOND CIRCUIT
SUMMARY ORDER RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE 32.1 AND THIS COURT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.
1 At a stated term of the United States Court of Appeals for the Second Circuit, 2 held at the Thurgood Marshall United States Courthouse, 40 Foley Square, in the City of 3 New York, on the 22nd day of January, two thousand twenty-four. 4 5 PRESENT: 6 MICHAEL H. PARK, 7 EUNICE C. LEE, 8 SARAH A. L. MERRIAM, 9 Circuit Judges. 10 __________________________________________ 11 12 Patrick Brendan Spillane, Debra Spillane, AKA 13 Deborah Spillane, 14 15 Plaintiffs-Appellants, 16 17 v. 23-247 18 19 New York City District Council of Carpenters 20 and Joiners of America, New York City District 21 Council of Carpenters Pension Fund, New York 22 City District Council of Carpenters Welfare 23 Fund, Joseph A. Geiger, as Trustee, Eddie 24 McWilliams, Kristin O’Brien, as Executive 25 Director of the New York City District Council of 26 Carpenters Benefit Funds, 27 28 Defendants-Appellees. * 29 __________________________________________ 30
* The Clerk of Court is respectfully directed to amend the caption accordingly. 1 FOR APPELLANTS: ROBERT K. ERLANGER, Erlanger Law Firm, PLLC, 2 New York, NY. 3 4 FOR UNION APPELLEES: GILLIAN COSTELLO (James M. Murphy on the brief), 5 Spivak Lipton LLP, New York, NY. 6 7 FOR FUND APPELLEES: MARTY GLENNON (John H. Byington, III on the 8 brief), Archer, Byington, Glennon & Levine, LLP, 9 Melville, NY. 10 11 Appeal from a judgment of the United States District Court for the Southern District of
12 New York (Torres, J.).
13 UPON DUE CONSIDERATION, IT IS HEREBY ORDERED, ADJUDGED, AND
14 DECREED that the judgment of the district court is AFFIRMED.
15 Plaintiff Patrick Brendan Spillane is a retired, dues-paying carpenter of New York City
16 District Council of Carpenters and Joiners of America (the “Union”). He and his beneficiary,
17 Debra Spillane (his wife), sued the Union, the Union’s Director of Area Standards Eddie
18 McWilliams, New York City District Council of Carpenters Pension Fund (the “Pension Fund”),
19 New York City District Council of Carpenters Welfare Fund (the “Welfare Fund”) (collectively,
20 the “Funds”), Joseph A. Geiger as Trustee of the Funds, and Kristin O’Brien as Executive Director
21 of the Funds. Plaintiffs allege that the Funds improperly terminated his pension and welfare
22 benefits following a Union trial at which Spillane was convicted of working as a carpenter for a
23 non-union company, Anfield Interiors, Inc. Spillane brought claims against the Union for
24 violating the Labor-Management Reporting and Disclosure Act (“LMRDA”) under 29 U.S.C. §§
25 411(a), 412, and 529; against the Funds for denial of benefits and breach of fiduciary duties under
26 the Employment Retirement Income Security Act of 1974 (“ERISA”) § 502(a)(1)(B), 29 U.S.C.
27 § 1132(a)(1)(B), and § 502(a)(3), 29 U.S.C. § 1132(a)(3), respectively; and against McWilliams
28 for prima facie tort under New York law. The district court determined that it had jurisdiction 2 1 under 29 U.S.C. § 412, deemed the LMRDA claim under 29 U.S.C. § 529 to be abandoned,
2 declined to exercise supplemental jurisdiction over the prima facie tort claim, and dismissed the
3 remaining causes of action for failure to state a claim. Spillane now appeals the district court’s
4 dismissals of his LMRDA claim under 29 U.S.C. § 411(a) and the ERISA claims. We assume
5 the parties’ familiarity with the underlying facts, the procedural history of the case, and the issues
6 on appeal.
7 “We review de novo the dismissal of a complaint pursuant to Fed. R. Civ. P. 12(b)(6),
8 accepting the alleged facts as true and drawing all reasonable inferences in plaintiffs’ favor.”
9 Allen v. Credit Suisse Secs. (USA) LLC, 895 F.3d 214, 222 (2d Cir. 2018).
10 I. LMRDA Claim
11 The district court properly dismissed Spillane’s unexhausted LMRDA claim against the
12 Union. See Paulino v. N.Y. Printing Pressman’s Union, Local Two, 301 F. App’x 34, 38 (2d Cir.
13 2008) (citing Maddalone v. Local 17, United Bhd. of Carpenters & Joiners of Am., 152 F.3d 178,
14 186 (2d Cir. 1998) (“The requirement that a plaintiff exhaust internal union remedies under the
15 LMRDA lies within the court’s discretion.”). LMRDA § 101(a)(4) states that a Union member
16 “may be required to exhaust reasonable hearing procedures . . . before instituting legal or
17 administrative proceedings” against the Union or its officers. 29 U.S.C. § 411(a)(4). In
18 determining whether to require a party to exhaust internal remedies, courts look to (1) “whether
19 union officials are so hostile to the employee that he could not hope to obtain a fair hearing on his
20 claim”; (2) “whether the internal union appeals procedures would be inadequate either to reactivate
21 the employee’s grievance or to award him the full relief he seeks”; and (3) “whether exhaustion of
22 internal procedures would unreasonably delay the employee’s opportunity to obtain a judicial
23 hearing on the merits of his claim.” Howd v. United Food & Com. Workers Union, Local 919,
3 1 383 F. App’x 38, 40 (2d Cir. 2010) (quoting Maddalone, 152 F.3d at 186). Spillane does not
2 contend that he exhausted his available remedies after being convicted at the Union trial. 2
3 Additionally, he has not shown that the Union officials were hostile to him, that the Union appeal
4 procedures were inadequate, or that abiding by Union procedures would unreasonably delay his
5 opportunity to be heard in court.
6 Spillane now argues that exhausting administrative remedies would have been futile
7 because of the district council’s hostility towards him and Anfield; the bias of a “crony [Trial
8 Committee] and ineffectual Trial Chair”; and the fact that his similarly situated fellow carpenter
9 Fitzsimons “exhausted his internal remedies to no avail.” Appellants’ Br. at 31-32. His claims
10 of futility, however, are speculative and insufficient to show that pursuing an administrative appeal
11 would have been futile.
12 Spillane failed to exhaust administrative remedies or to show that doing so would have
13 been futile, so we affirm the district court’s dismissal of Spillane’s LMRDA claim.
14 II. ERISA Claims
15 1. ERISA § 502(a)(1)(B), Denial of Benefits
16 The district court correctly held that Spillane’s claim under ERISA § 502(a)(1)(B), 29
17 U.S.C. § 1132(a)(1)(B), against the Pension Fund for denial of benefits is time-barred. The Plan’s
18 limitation period clause states: “Any action by a Participant, Spouse or Beneficiary under ERISA
19 Section 502(a) following an adverse benefit determination on review must be filed within 365 days
20 from the date of notice of the adverse benefit determination.” Joint App’x at A-56 to -57
21 (emphasis added). A one-year limitations period from the conclusion of internal review is
2 The Union denied Spillane’s attempt to internally appeal as untimely. Spillane did not allege in his complaint, nor does he argue now, that his appeal was timely or that he in fact exhausted his available remedies. 4 1 reasonable and enforceable. See Heimeshoff v. Hartford Life & Acc. Ins. Co., 571 U.S. 99, 109-
2 10 (2013) (“[A] hypothetical 1-year limitations period commencing at the conclusion of internal
3 review would be reasonable.”).
4 Spillane also fails to state an ERISA claim of denial of benefits against the Welfare Fund.
5 Even assuming the claim against the Welfare Fund was not time-barred, Spillane fails to show that
6 the Welfare Fund’s determination was arbitrary or capricious. See Ocampo v. Bldg. Serv. 32B-J
7 Pension Fund, 787 F.3d 683, 690 (2d Cir. 2015) (“[W]here the written plan documents confer
8 upon a plan administrator the discretionary authority to determine eligibility, we will not disturb
9 the administrator’s ultimate conclusion unless it is arbitrary and capricious.” (internal quotation
10 marks omitted)). The Welfare Fund’s Summary Plan Description (“SPD”) defines “disqualifying
11 employment” as “any work in the states of New York and New Jersey that falls under the trade
12 jurisdiction of the [Union] for an employer who is not required to contribute to the Welfare Fund
13 on your behalf.” Joint App’x at A-63. The plain language of the SPD allowed the Funds to rely
14 on the Union’s determination that Spillane’s job was a covered employment in order to make its
15 own determination to terminate Spillane’s health care coverage. Moreover, even if Spillane’s
16 interpretation of what constitutes disqualifying employment might be rational, the Fund’s
17 reasonable interpretation prevails. See McCauley v. First Unum Life Ins. Co., 551 F.3d 126, 132
18 (2d Cir. 2008) (“Where both the plan administrator and a spurned claimant offer rational, though
19 conflicting, interpretations of plan provisions, the administrator’s interpretation must be allowed
20 to control.” (quoting Pulvers v. First UNUM Life Ins. Co., 210 F.3d 89, 92-93 (2d Cir. 2000)).
21 The district court thus properly dismissed Spillane’s ERISA § 502(a)(1)(B) claim for
22 denial of benefits.
5 1 2. ERISA § 502(a)(3), Breach of Fiduciary Duties
2 The district court also properly determined that Spillane fails to state a claim under ERISA
3 § 502(a)(3), 29 U.S.C. § 1132(a)(3), against the Funds for breach of fiduciary duties because he
4 does not allege specific factual allegations to support his claim. As an initial matter, neither David
5 Stewart (Funds’ Executive Director) nor Paul Capurso (Union President and Trustee) is a named
6 defendant. Second, the Amended Complaint does not make any specific factual allegations
7 concerning Geiger, Capurso, or Stewart. Third, Spillane takes issue with Geiger and his allegedly
8 conflicting roles as Funds Trustee and the Union Executive Secretary Treasurer. But a “trustee
9 under ERISA may wear different hats,” and is not precluded from having “financial interests
10 adverse to beneficiaries.” Pegram v. Herdrich, 530 U.S. 211, 225 (2000). “Employers, for
11 example, can be ERISA fiduciaries and still take actions to the disadvantage of employee
12 beneficiaries, when they act as employers” as long as “the fiduciary with two hats wear[s] only
13 one at a time, and wear[s] the fiduciary hat when making fiduciary decisions.” Id. Moreover,
14 the Amended Complaint does not allege and Spillane does not contend in his briefing that Geiger’s
15 involvement in benefit determinations somehow breached his fiduciary duties. The allegations in
16 the Amended Complaint concerning Geiger consist of speculation and unsubstantiated name-
17 calling. See, e.g., A-14 to -15, A-17 to -18, A-27, A-35 (referring to Union officials and members
18 of the Trial Committee as Geiger’s “cronies” or “crony tools”).
19 Additionally, Spillane provides no separate basis for his breach of fiduciary duty claim
20 differentiating it from his denial of benefits claim. 3 See Aracich v. Bd. of Trs. of Emp. Benefit
3 Defendants argue that a breach of fiduciary duty claim provides only for equitable relief while Spillane seeks only monetary damages. But Spillane asks in his Amended Complaint for “an injunction ordering specific performance” requiring the Funds to restore his pension benefits and health care coverage. Joint App’x at A-39. 6 1 Funds of Heat & Frost Insulators Local 12, No. 22-2544, 2023 WL 4692316, at *5 (2d Cir. July
2 24, 2023) (rejecting two contentions because they did not state an independent ERISA claim for
3 breach of fiduciary duties but were duplicative of plaintiff’s ERISA claim for denial of benefits);
4 Xiaohong Xie v. JPMorgan Chase Short-Term Disability Plan, No. 15-cv-04546, 2017 WL
5 2462675, at *4 (S.D.N.Y. June 7, 2017) (“[C]ourts in this Circuit have repeatedly rejected attempts
6 to repackage claims for wrongful denial of benefits under Section 502(a)(1) as claims for breaches
7 of fiduciary duties under Section 502(a)(3).” (quotation marks omitted)). Moreover, Spillane
8 seeks the same relief in his claim for breach of fiduciary duty as he does in his claim for denial of
9 benefits. 4 The district court thus properly dismissed Spillane’s claim for breach of fiduciary
10 duties under ERISA § 502(a)(3).
11 We have considered all of Spillane’s remaining arguments and find them to be without
12 merit. For the foregoing reasons, the judgment of the district court dismissing the ERISA and
13 LMRDA claims is AFFIRMED.
14 FOR THE COURT: 15 Catherine O’Hagan Wolfe, Clerk of Court
4 In addition to the same request for relief, Spillane seeks disgorgement of pension benefits and a “surcharge from the breaching fiduciaries.” Joint App’x at A-39. These are monetary damages that ERISA § 502(a)(3) does not provide. 7