United States District Court, D. South Carolina, Greenville Division
The Michelin Retirement Plan; The Investment Committee of the Michelin Retirement Plan, Plaintiffs,
Chicago Transit Authority Retiree Health Care Trust, Intervenor Plaintiff,
Dilworth Paxson LLP; BFG Socially Responsible Investments, Ltd.; Burnham Financial Group, Inc.; Burnham Securities, Inc.; COR Fund Advisors, LLC; GMT Duncan, LLC; Thorsdale Fiduciary and Guaranty Company Ltd.; Valor Group Ltd.; Wakpamni Lake Community Corp.; Wealth-Assurance AG; Wealth Assurance Private Client Corporation; Timothy B. Anderson; Jon Michael Burnham; Devon D. Archer; Bevan T. Cooney; Hugh Dunkerley; Jason W. Galanis; John P. Galanis; Gary T. Hirst; Frankie D. Hughes; and Michelle A. Morton, Defendants, Frankie D. Hughes, Counter Claimant,
The Michelin Retirement Plan; The Investment Committee of the Michelin Retirement Plan, Counter Defendants.
C. COGGINS, JR. UNITED STATES DISTRICT JUDGE
matter is before the Court on a Motion to Dismiss filed by
Defendants Dilworth Paxson, LLP (“Dilworth”) and
Timothy B. Anderson (collectively, the “DP
Defendants”). ECF No. 301. Plaintiffs filed a Response
in Opposition, and the DP Defendants filed a Reply. ECF Nos.
309, 315. In accordance with 28 U.S.C. § 636(b) and
Local Civil Rule 73.02(B)(2) (D.S.C.), this matter was
referred to United States Magistrate Judge Jacquelyn D.
Austin for pre-trial proceedings and a Report and
Recommendation (“Report”). On January 28, 2019,
the Magistrate Judge issued a Report recommending that the
Motion to Dismiss be granted. ECF No. 408. Plaintiffs and the
DP Defendants filed objections to the Report and Replies to
the objections. ECF Nos. 423, 424, 433, 434.
Magistrate Judge makes only a recommendation to this Court.
The recommendation has no presumptive weight, and the
responsibility to make a final determination remains with the
Court. See Mathews v. Weber, 423 U.S. 261 (1976).
The Court is charged with making a de novo determination of
any portion of the Report of the Magistrate Judge to which a
specific objection is made. The Court may accept, reject, or
modify, in whole or in part, the recommendation made by the
Magistrate Judge or recommit the matter to the Magistrate
Judge with instructions. See U.S.C. § 636(b). The Court
will review the Report only for clear error in the absence of
an objection. See Diamond v. Colonial Life & Accident
Ins. Co., 416 F.3d 310, 315 (4th Cir. 2005) (stating
that “in the absence of timely filed objection, a
district court need not conduct a de novo review, but instead
must only satisfy itself that there is no clear error on the
face of the record in order to accept the
recommendation.” (citation omitted)).
Court notes that neither party has objected to the Magistrate
Judge's conclusion that Plaintiffs have standing to
assert claims against the DP Defendants, that Plaintiffs
suffered an Article III injury in fact, and that the
Investment Committee is a fiduciary that is statutorily
authorized to bring claims. The Court has reviewed this
portion of the Report for clear error; finding none, the
Court adopts the reasoning of the Magistrate Judge with
respect to these conclusions. The Court now turns to the
Magistrate Judge found that Count II fails to state a claim
against the DP Defendants because the relief they request is
not available in an ERISA § 502(a)(3) claim.
Specifically, she determined that Plaintiffs are seeking only
“actual damages and consequential damages . . . costs
and attorneys' fees”, which are not available under
§ 502(a)(3). ECF No. 408 (citing ECF No. 1 at 57).
object to the Magistrate Judge's recommendation and argue
that a request for monetary relief can be a request for
appropriate equitable relief as recognized in CIGNA Corp.
v. Amara, 563 U.S. 421 (2011). Plaintiffs contend that
Amara was decided after the case relied on by the
Magistrate Judge, Hornady Transp. LLC v. McLeod Health
Servs., Inc., 773 F.Supp.2d (D.S.C. 2011), and
enunciated a broader scope of equitable relief available
under § 502(a)(3), including disgorgement and surcharge.
Court has thoroughly reviewed the record, applicable law, and
the Report of the Magistrate Judge. Having done so, the Court
agrees with the recommendation of the Magistrate Judge that
Plaintiffs' requested relief is not available in a §
502(a)(3) claim. Plaintiffs are correct that Amara recognized
a broader category of equitable relief available under §
502 (a)(3), including “restitution, disgorgement,
accounting for profits, etc.” Pender v. Bank of Am.
Corp., 736 Fed.Appx. 359, 368 (4th Cir. 2018), cert.
denied, 139 S.Ct. 1261 (2019). However, here, Plaintiffs have
not requested restitution,  disgorgement, accounting for
profits, surcharge, or any other kind of equitable relief
available pursuant to § 502(a)(3). Moreover, there is no
allegation that the DP Defendants received any of the
transfers or misused any of Plaintiffs' assets such that
an equitable remedy would be appropriate. Plaintiffs'
objections are overruled with respect to Count
Defendants argue that if Count II is dismissed, this Court
lacks personal jurisdiction over the DP Defendants with
respect to a state law claim for professional
negligence once the ERISA claim against them has been
dismissed. It appears this argument was not directly
addressed by the Magistrate Judge. Upon review, the Court
agrees that, because Plaintiffs can no longer rely on
ERISA's nationwide service of process provision, it lacks
personal jurisdiction over the DP Defendants to decide a
state law claim for professional negligence.
federal court may exercise personal jurisdiction over a
defendant in the manner provided by state law. Fed.R.Civ.P.
4(k)(1)(A). Thus, "for a district court to validly
assert personal jurisdiction over a non-resident defendant,
two conditions must be satisfied. First, the exercise of
jurisdiction must be authorized by the long-arm statute of
the forum state, and, second, the exercise of personal
jurisdiction must also comport with Fourteenth Amendment due
process requirements." Christian Sci. Bd. of Dirs.
of First Church of ...