The equitable remedies prong of ERISA was, for many years, a place where theoretically good claims went to die: courts were wary of providing expansive recovery under it, and thus a plaintiff who could not fit a claim within the confines of the denial of benefits or breach of fiduciary duty causes of action under ERISA was unlikely to recover by relying on the equitable remedies prong, no matter how factually compelling the plaintiff’s case. As I explained in my recent article, “Looking Closely at Operational Competence: ERISA Litigation Moves Away from Doctrine and Towards a Careful Review of Plan Performance,” recent case law, including from the Supreme Court, has completely changed this dynamic, and made equitable relief a viable manner of targeting harms arising from ERISA governed plans when those harms could not support claims for denied benefits or for fiduciary breach.
A decision last week out of the United States District Court for the District of Rhode Island, Blue Cross & Blue Shield of Rhode Island v. Korsen, provides an outstanding roadmap for making out an equitable relief claim under ERISA in 2013, after the lay of the land for such claims was revamped by the Supreme Court in Amara. You can do worse – much worse – than to follow the judge’s framework to determine whether you have a viable equitable relief claim and, if so, the best way to present each element.
In addition, though, the Court touched on a fundamental issue in equitable relief litigation under ERISA, which has engendered some controversy over the years, namely, is the outcome of equitable relief claims under ERISA dependent solely on whether the precise elements of such claims as set forth in Supreme Court decisions exist, or can courts go beyond those and rely on the general and long standing principles of equity to decide such claims? In short, do such claims rise or fall only on whether the exact principles detailed in the Sereboff line of cases and Amara are met (such as the recovery is one allowed in the days of the divided bench, and a designated fund is being targeted)? Or can the court, even if these elements are satisfied, still reject such claims if needed to “do equity,” in the old vernacular – i.e., to be fair?
The Court in Korsen gives a compelling argument for the latter.
And finally, by the way, in the old – and I was hoping by now discarded – vernacular, a hat tip to @Jon Pincince for bringing the case to my attention.