Guenther v. Lockheed Martin Corp., No. 17-16984 (9th Cir. 2020)
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The Ninth Circuit affirmed the district court's order granting summary judgment in favor of defendants in an action under the Employee Retirement Income Security Act (ERISA), alleging that a fiduciary breached its duty to make accurate representations to a beneficiary.
The panel first held that defendants did not waive their statute of limitations affirmative defense. The panel applied Intel Corp. Inv. Policy Committee v. Sulyma, 140 S. Ct. 768 (2020), which held that "actual knowledge" requires more than merely a possible inference from ambiguous circumstances, but rather knowledge that is actual. The panel held that the record establishes that the beneficiary had actual knowledge of the alleged breach and failed to bring suit within the three-year statute of limitations prescribed under ERISA. In this case, the district court correctly determined that the beneficiary had actual knowledge of the alleged misrepresentation when he received a letter from defendants regarding the bridging of service under the retirement plan. Therefore, the beneficiary's claim is time-barred. Furthermore, there is no exception for fraudulent concealment that triggers the six-year statute of limitations here. Finally, the panel held that the district court did not abuse its discretion in denying the beneficiary's post-judgment motion for reconsideration.
Court Description: Employee Retirement Income Security Act. Affirming the district court’s summary judgment in favor of defendants, the panel held that a claim of breach of fiduciary duty in violation of the Employee Retirement Income Security Act was time-barred under 29 U.S.C. § 1113(2), which provides that such a claim must be brought within three years of the date on which the plaintiff obtained “actual knowledge” of the breach. First, the panel held that the defendant did not waive its statute of limitations affirmative defense, raised in answer to a second amended complaint filed during proceedings on remand from this court, either by litigating the case to judgment without ever raising the defense or by compelling plaintiff to exhaust administrative remedies without asserting the defense. Addressing the merits of the defense, the panel applied Intel Corp. Inv. Policy Committee v. Sulyma, 140 S. Ct. 768 (2020), which held that “actual knowledge” requires more than merely a possible inference from ambiguous circumstances, but rather knowledge that is actual. Plaintiff alleged that in a letter regarding bridging of service under a retirement plan, defendant breached its duty to make accurate representations to a beneficiary. The panel concluded that the sending of this letter provided the basis for plaintiff’s claim, and he had actual knowledge of GUENTHER V. LOCKHEED MARTIN 3 defendant’s alleged misrepresentation upon receipt of the letter. The panel held that actual knowledge does not mean that a plaintiff has knowledge that the underlying action violated ERISA, not does it merely mean that the plaintiff has knowledge that the underlying action occurred. Instead, the defendant must show that the plaintiff was actually aware of the facts constituting the breach, as well as the nature of the breach. The panel concluded that plaintiff’s suit was barred by the statute of limitations because he did not file suit within three years of obtaining actual knowledge of the alleged breach. The panel held that an exception for fraudulent concealment, triggering application of ERISA’s six-year statute of limitations, did not apply. The panel also held that the district court did not abuse its discretion in denying plaintiff’s post-judgment motion for reconsideration.
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