Cgi Technologies and Solutions v. Rhonda Rose

Opinion by Judge GOULD; Concurrence by Judge SCHROEDER; Dissent by Chief District Judge BEISTLINE.

OPINION

Rhonda Rose (“Rose”) appeals the district court’s grant of partial summary judgment in favor of CGI Technologies and Solutions, Inc. (“CGI”) in its action seeking “appropriate equitable relief’ under § 502(a)(3) of the Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C. § 1001 , et seq. CGI appeals the district court’s grant of partial summary judgment in favor of Rose’s counsel and co-defendant, Nelson Langer Engle, PLLC (“NLE”), dismissing NLE from the action. CGI also appeals the district court’s grant of proportional fees and costs to NLE, deducted from CGI’s recovery from Rose. We affirm in part and reverse in part, remanding the matter to the district court for further proceedings consistent with our decision.

I

Rose was employed by CGI which provides to its employees and their dependents a self-funded welfare benefits plan (“the Plan”) governed by ERISA. The Plan includes a subrogation and reim *1116 bursement clause that expressly: (1) gives to CGI the right to full reimbursement for medical expenses paid on behalf of the beneficiary from any…

concurring:

I concur in Judge Gould’s good opinion. It reaches the right result, and reconciles ERISA’s statutory language, giving courts power to fashion “appropriate equitable relief,” ERISA § 502(a)(3), with Supreme Court discussions of the statute. The ERISA Plan document in this case provided that if the Plan paid out benefits to a beneficiary who later recovered tort damages from a third party, the Plan would have a first priority for total reimbursement from the recovery — even when, as in this case, the recovery represented a small fraction of the beneficiary’s damages and the beneficiary would be left with very little. This unfairness was magnified by a provision purporting to disclaim the equitable common fund doctrine — a provision that, if enforced, would mean the Plan would not have to contribute to the fees of the attorneys who recovered the money from which the Plan would be reimbursed.

The district court considered itself bound to apply the provisions of the Plan document. The result — leaving the beneficiary here vastly undercompensated for her actual damages, and the Plan unjustly enriched — is manifestly unfair. It is also inconsistent with Congress’s purpose…

dissenting:

I respectfully dissent. While the majority reaches a fair result under the facts presented, it does so at the expense of the plain language of the Plan and effectively usurps the role of Congress in establishing restrictions on how such plans may manage themselves. In my view, the District Court granted “appropriate equitable relief’ when it enforced the reimbursement provision of the Plan. The majority expresses no opinion as to whether CGI is entitled to reimbursement, but simply states that, in the interest of eliminating unjust enrichment, the District Court should have considered the make-whole doctrine and the common fund doctrine in its determination of what constituted an appropriate equitable remedy under 29 U.S.C. § 1132 (a)(3). Yet, in reaching its conclusion, the majority disregards the fact that both doctrines are disclaimed in the language of the Plan. By expressly abandoning both doctrines, the Plan precludes their application. While I can understand the merits of these doctrines, I do not believe that we can now inject principles into the Plan that the Plan purposefully and specifically excluded. I do not view the “appropriate equitable relief’…

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CGI TECHNOLOGIES AND SOLUTIONS 

INC, in its capacity as sponsor and fiduciary for CGI Technologies and Solutions, Inc Welfare Benefit Plan, No. 11-35127 Plaintiff-Appellee,  D.C. No. v. 2:10-cv-00298-RSM

RHONDA ROSE; NELSON LANGER

ENGLE PLLC,

Defendants-Appellants. 

CGI TECHNOLOGIES AND SOLUTIONS 

INC, in its capacity as sponsor and fiduciary for CGI Technologies and Solutions, Inc Welfare Benefit No. 11-35128 Plan, Plaintiff-Appellant,  D.C. No. 2:10-cv-00298-RSM v. OPINION

RHONDA ROSE; NELSON LANGER

ENGLE PLLC,

Defendants-Appellees.  Appeal from the United States District Court for the Western District of Washington Ricardo S. Martinez, District Judge, Presiding

Argued and Submitted February 9, 2012—Seattle, Washington

Filed June 20, 2012

7219 7220 CGI TECHNOLOGIES AND SOLUTIONS v. ROSE Before: Mary M. Schroeder and Ronald M. Gould, Circuit Judges, and Ralph R. Beistline, Chief District Judge.*

Opinion by Judge Gould; Concurrence by…