When Is a Plan Administrator a Fiduciary?

Here is a fascinating decision out of the federal district court for Rhode Island arising out of a dispute over plan contributions required of a contractor under collective bargaining agreements in the construction context. What I most liked about the case is its discussion of the challenge to the plaintiffs’ standing to bring an ERISA action, on the ground that the plaintiffs were not participants, beneficiaries or fiduciaries of the plans in question. The central issue concerned whether the plaintiffs qualified as fiduciaries for these purposes, and the court’s primary analysis was directed at whether one of the plaintiffs, who was the plan administrator, qualified as a fiduciary.

The district court concluded that it did, and in addressing this issue, provides a terrific synopsis of the law in the First Circuit concerning when an entity qualifies as a fiduciary for these purposes, and in particular when a plan administrator qualifies for that status. The court stated (I have omitted the voluminous citations to statute and case law, but it is here in the opinion itself for those of you who are interested):  

An ERISA fiduciary includes any person who "has any discretionary authority or discretionary responsibility in the administration of [an employee benefit] plan." ERISA also provides that a fiduciary "exercises any discretionary authority or discretionary control respecting management of [a] plan or exercises any authority or control respecting management or disposition of its assets." In addition: [r]egulations promulgated by the Department of Labor interpreting ERISA make clear that the administrator and trustees of a pension plan are fiduciaries within the meaning of the statue, for a plan administrator or a trustee of a plan must, b[y] the very nature of his position, have discretionary authority or discretionary responsibility in the administration of the plan within the meaning of section 3(21)(A)(iii) . . . . Thus, at least according to many courts that have addressed the issue, a plan administrator is per se a fiduciary. The Court of Appeals for the First Circuit appears to have expressed a similar tenet, although recently, the court has characterized this as an assumption, not a holding. Absent any clear authority in any circuit to the contrary, this court will also proceed on this assumption. Consequently, because the plan administrator is named as a plaintiff in this suit, and is acting in a fiduciary capacity, he therefore must be considered a fiduciary within the meaning of 29 U.S.C. § 1132(e)(1). Accordingly, because the plan administrator has standing this court has jurisdiction to hear the claims.

The case is Rhode Island Carpenters Annuity Fund v. Trevi Icos Corp.