Burstein v. Retirement Account Plan for Employees of Allegheny Health Education & Research Foundation

Opinions of the United

2003 Decisions States Court of Appeals

for the Third Circuit

7-2-2003

Burstein v. Retirement Account

Precedential or Non-Precedential: Precedential

Docket No. 02-2666

Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_2003

Recommended Citation

"Burstein v. Retirement Account" (2003). 2003 Decisions. Paper 330.

http://digitalcommons.law.villanova.edu/thirdcircuit_2003/330

This decision is brought to you for free and open access by the Opinions of the United States Court of Appeals for the Third Circuit at Villanova

University School of Law Digital Repository. It has been accepted for inclusion in 2003 Decisions by an authorized administrator of Villanova

University School of Law Digital Repository. For more information, please contact Benjamin.Carlson@law.villanova.edu.

PRECEDENTIAL

Filed July 2, 2003

UNITED STATES COURT OF APPEALS

FOR THE THIRD CIRCUIT

No. 02-2666

WILLIAM H. BURSTEIN, M.D.; EFRAIN J. CRESPO, M.D.;

RICHARD R. AUSTIN; ELEANOR HING FAY;

JEAN B. HAAS, individually and on behalf of others

similarly situated,

Appellants

v.

RETIREMENT ACCOUNT PLAN FOR EMPLOYEES OF

ALLEGHENY HEALTH EDUCATION AND RESEARCH

FOUNDATION, c/o Administrator Dwight Kasperbauer,

individually and as Plan Administrator, and named

fiduciary; DAVID C. McCONNELL; WILLIAM F. ADAM; J.

DAVID BARNES; RALPH W. BRENNER; DOROTHY

MCKENNA BROWN; FRANK V. CAHOUET; DOUGLAS D.

DANFORTH; RONALD R. DAVENPORT; HARRY R.

EDELMAN, III; ROBERT L. FLETCHER; IRA J. GUMBERG;

ROBERT M. HERNANDEZ; FRANCIS B. NIMICK, JR.;

ROBERT B. PALMER; ROBERT M. POTAMKIN; DAVID W.

SCULLEY; W. P. SNYDER, III; MELLON BANK NA;

PENSION BENEFIT GUARANTY CORPORATION, as

successor-in-interest

On Appeal from the United States District Court

for the Eastern District of Pennsylvania

(D.C. Civ. No. 98-cv-06768)

District Judge: Honorable Charles R. Weiner

Argued: April 24, 2003

Before: SCIRICA, Chief Judge, AMBRO and

GARTH, Circuit Judges

2

(Opinion Filed: July 2, 2003)

Jay W. Eisenhofer (argued)

Denise T. DiPersio

Grant & Eisenhofer, P.A.

1201 North Market Street,

Suite 2100

Wilmington, DE 19801

Mark J. Krum

1515 Market Street, Suite 1100

Philadelphia, PA 19102

Counsel for Appellants

John F. Schultz (argued)

Kristofor T. Henning

Drinker, Biddle & Reath, LLP

18th & Cherry Streets

One Logan Square

Philadelphia, PA 19103

Counsel for Appellees

Retirement Account Plan and

Kasperbauer

David J. Laurent

Babst, Calland, Clements &

Zomnir, P.C.

Two Gateway Center

8th Floor

Pittsburgh, PA 15222

Counsel for Appellee McConnell

David L. McClenahan (argued)

William T. Cullen

Wendy E. D. Smith

Kirkpatrick & Lockhart

535 Smithfield Street

Henry W. Oliver Building

Pittsburgh, PA 15222

Counsel for Appellees Adam, Brown,

Danforth, Edelman, Fletcher,

Gumberg, Hernandez, Nimick,

Palmer, Potamkin,and Sculley

3

Thomas J. Farrell

Thieman & Farrell

436 Seventh Avenue

2312 Koppers Building

Pittsburgh, PA 15219

Counsel for Appellee Barnes

Michele Langer

Marvin, Larsson, Henkin &

Scheuritzel

1500 Market Street

Centre Square West, Suite 3510

Philadelphia, PA 19102

Counsel for Appellee Brenner

James J. Restivo, Jr.

Perry A. Napolitano

Daniel E. Wille

Reed Smith

435 Sixth Avenue

Pittsburgh, PA 15219

Counsel for Appellee Cahouet

Anthony W. Clark

Eric M. Davis

Skadden, Arps, Slate, Meagher

& Flom

One Rodney Square

P.O. Box 636

Wilmington, DE 19899

Henry P. Wasserstein

Jonathan L. Frank

Skadden, Arps, Slate, Meagher

& Flom

Four Times Square

New York, NY 10036

Counsel for Appellee Snyder

4

Jay H. Calvert, Jr.

Joseph B.G. Fay

Steven D. Spencer

Morgan, Lewis & Bockius LLP

1701 Market Street

Philadelphia, PA 19103

Counsel for Appellee

Mellon Bank, N.A.

James J. Keightley,

General Counsel

Jeffrey B. Cohen,

Deputy General Counsel

Deborah West,

Senior Assistant General Counsel

Sara B. Eagle (argued)

Joseph M. Krettek

Pension Benefit Guaranty

Corporation

Office of the General Counsel

1200 K Street, N.W.

Washington, DC 20005

Counsel for Appellee Pension Benefit

Guaranty Corporation

OPINION OF THE COURT

GARTH, Circuit Judge:

The plaintiff-appellants in this ERISA case appeal from

the district court’s dismissal of their First Amended

Complaint for failure to state a claim and also challenge the

denial of their motion to file a Second Amended Complaint

as futile.

The plaintiffs are five former employees of the now-

bankrupt Allegheny Health Education and Research

Foundation (“AHERF ”). These plaintiffs sought to recover

benefits that they believed they had accrued through

AHERF ’s Retirement Account Plan. They also sought to

represent a class of similarly situated persons, though that

issue is not before us. The plaintiffs filed various claims

5

under provisions of the Employee Retirement Income

Security Act of 1974, 88 Stat. 891, as amended, 29 U.S.C.

§ 1001 et seq.

As we will explain, in the course of resolving this appeal,

we join several other Circuits in ruling that when a

summary plan description under ERISA conflicts with the

complete, detailed ERISA plan document, a plan participant

may nevertheless state a claim for plan benefits based upon

terms contained in the summary plan description.

Therefore, and for further reasons specified in this

opinion, we will reverse the dismissal of the plaintiffs’ claim

for plan benefits against the Plan itself and against the

Pension Benefit Guaranty Corporation (“PBGC”) as Plan

administrator, as distinct from guarantor. We will also

reverse the dismissal of the plaintiffs’ claim for breach of

fiduciary duty against Dwight Kasperbauer, the Plan’s

former administrator. However, we will affirm the dismissal

of the remaining counts and of all other defendants, and

will also direct the district court to permit the plaintiffs to

make a final effort at amending the complaint. Finally, in

light of our disposition, which reverses the district court’s

dismissal of certain counts, we will also reverse the district

court’s ruling that the plaintiffs’ motion for class

certification was moot, inasmuch as the counts we are

reversing must once again receive the district court’s

attention.

I.

Since this appeal is from a Rule 12(b)(6) motion to

dismiss as well as from the denial of leave to file an

amended complaint, we have derived our explication of the

facts from the allegations contained in the plaintiffs’ First

Amended Complaint, supplemented by some additional

facts alleged in the proposed Second Amended Complaint.

A. The Parties

The plaintiffs-appellants in this case are William H.

Burstein, M.D., Efrain J. Crespo, M.D., Richard R. Austin,

Eleanor Hing Fay, and Jean B. Haas. According to the

6

proposed Second Amended Complaint (“SAC” or

“complaint”), Burstein was employed as a doctor at AHERF

for four years, and became an employee of the Tenet

Healthcare Corporation when Tenet purchased some of

AHERF ’s assets. Crespo had been employed as a doctor by

AHERF for “less than five years,” SAC ¶ 13, and also

became a Tenet employee. Austin had been employed by

AHERF as director of major gifts and planned giving at St.

Christopher’s Hospital for three and a half years. Hing Fay

had been employed by AHERF for two and three-quarters

years in the Corporate and Foundation Relations

department at St. Christopher’s Hospital for Children. Haas

had been employed by AHERF for one year in the

development office of (we assume) St. Christopher’s Hospital.1

AHERF laid off Austin, Hing Fay, and Haas on September

30, 1998, and Tenet did not hire them.2

There are several defendants-appellees in this case. They

are: (1) the Plan itself; (2) the PBGC;3 (3) Dwight

Kasperbauer, the former Plan administrator, and a former

executive vice president and chief of human resources at

AHERF; (4) the Plan’s former asset manager, David

McConnell, who had been AHERF ’s chief financial officer;

(5) the members of the Plan sponsor’s Board of Trustees

(“AHERF Trustees”);4 and (6) the Plan’s custodial trustee,

Mellon Bank.

1. The complaint does not specify at which “Development Office” Haas

worked. SAC ¶ 19.

2. We will refer to these five plaintiffs collectively as “Burstein.”

3. The PBGC “is a wholly owned United States Government corporation

. . . The PBGC administers and enforces Title IV of ERISA. Title IV

includes a mandatory Government insurance program that protects the

pension benefits of [tens of millions of] private-sector American workers

who participate in plans covered by the Title.” Pension Ben. Guar. Corp.

v. LTV Corp., 496 U.S. 633, 636-37 (1990) (citing 29 U.S.C. § 1302)

(other citations omitted).

Burstein has sued PBGC both in its role as statutory guarantor under

Title IV of ERISA and in its role as the substituted administrator for

Kasperbauer, the former Plan administrator. As substituted

administrator, PBGC now administers the terminated Plan. We explain

this distinction in Part III, infra.

4. The AHERF Trustees, according to the complaint, are William F.

Adam, J. David Barnes, Ralph W. Brenner, Dorothy McKenna Brown,

7

B. The Events Leading to the Lawsuit

In 1988, AHERF, which operated hospitals and other

health-care facilities in western Pennsylvania, began

acquiring hospitals and associated physician practices and

medical schools in the Philadelphia area.

AHERF had begun to experience significant financial

losses by the late 1990s. In July 1998, AHERF filed for

bankruptcy. The complaint alleges that AHERF, a non-

profit corporation, was profligate in its expenditures and

generous (to a fault) in furnishing its executives with

compensation, stock options, travel opportunities, and the

like. SAC ¶¶ 43-44, 49, 51, 53, 55.

In the months prior to filing for bankruptcy, AHERF

made an $89 million payment on a line of credit to Mellon

Bank (the Plan’s custodial trustee), id. ¶ 47, and the

complaint alleges that Mellon Bank, and certain trustees

with relationships to the bank, exerted improper influence

to secure this payment. Id. ¶ 48.

The bankruptcy court auctioned off AHERF ’s assets,

including eight Philadelphia-area hospitals. The eight

hospitals were purchased by Tenet, a for-profit health care

company. The Retirement Account Plan was not acquired

by Tenet. SAC ¶¶ 56-57.

AHERF ’s Retirement Account Plan was a defined benefit

pension plan under ERISA.5 The AHERF Plan was a “cash

Frank V. Cahouet, Douglas D. Danforth, Ronald R. Davenport, Harry R.

Edelman, III, Robert L. Fletcher, Ira J. Gumberg, Robert M. Hernandez,

Francis B. Nimick, Robert B. Palmer, David W. Sculley, and W.P. Snyder,

III. SAC ¶¶ 24-34, 36-39. Our disposition of claims against the AHERF

Trustees does not require differentiating among them except where

noted.

5. According to ERISA,

The term “defined benefit plan” means a pension plan other than an

individual account plan; except that a pension plan which is not an

individual account plan and which provided a benefit derived from

employer contributions which is based partly on the balance of the

separate account of a participant—

8

balance plan,”6 a form of a defined benefit plan under

ERISA in which “the employer’s contribution is made into

hypothetical individual employee accounts.” SAC ¶ 66. The

complaint alleged that because the Plan “speaks in terms of

a participant’s ‘account,’ many participants are fooled into

thinking that the cash balance plan works like a defined

contribution plan.” Id. Under a cash balance plan, however,

(A) for the purposes of section 202 . . . shall be treated as an

individual account plan, and

(B) for the purposes of paragraph (23) of this section and section

204 . . . shall be treated as an individual account plan to the extent

benefits are based upon the separate account of a participant and

as a defined benefit plan with respect to the remaining portion of

benefits under the plan.

29 U.S.C. § 1002(35). ERISA defines an individual account plan (or

“defined contribution plan”) as “a pension plan which provided for an

individual account for each participant and for benefits based solely

upon the amount contributed to the participant’s account, and any

income, expenses, gains and losses, and any forfeitures of accounts of

other participants which may be allocated to such participant’s account.”

Id. § 1002(34).

6. The Employee Benefits Security Administration (the agency of the

Department of Labor responsible for administering and enforcing

provisions of Title I of ERISA) has explained the difference between

traditional defined benefit pension plans and cash balance plans as

follows:

While both traditional defined benefit plans and cash balance plans

are required to offer payment of an employee’s benefit in the form of

a series of payments for life, traditional defined benefit plans define

an employee’s benefit as a series of monthly payments for life to

begin at retirement, but cash balance plans define the benefit in

terms of a stated account balance. These accounts are often referred

to as hypothetical accounts because they do not reflect actual

contributions to an account or actual gains and losses allocable to the

account.

U.S. Department of Labor, Employee Benefits Security Administration,

“Frequently Asked Questions about Cash Balance Pension Plans,” at

http://www.dol.gov/ebsa/FAQs/faq_consumer_cashbalanceplans.html

(as visited May 23, 2003) (emphasis added).

9

if the plan terminates, “it is possible that the plan will be

underfunded as to some or all of the participants.” Id.

Indeed, ERISA does not require that the cash-balance

plan sponsor fund the plan fully for all participants; rather,

it only requires that these plans be funded for those

participants whose benefits had vested prior to the plan’s

(partial) termination.7 Burstein has not claimed that AHERF

failed to fund the Plan in accordance with these minimum

standards.

Burstein alleges that he was surprised to learn that

AHERF had not funded the Plan for the benefits he believed

had accrued. According to the complaint, the Plan

administrator, defendant Kasperbauer, mailed form letters

dated November 25, 1998, to various former employees.

The complaint alleges that the letter sent to Burstein was

addressed to “Former AHERF Employees who Transferred

to Tenet or the New University.” This letter explained that

a partial plan termination had occurred, but that any

person who had not completed five years of service with

AHERF would not be entitled to any benefits:

As you may be aware, the Retirement Account Plan

also contains a provision, required by the Internal

Revenue Code, concerning vesting in the event of a

partial plan termination. Specifically, this provision

states that, if there is a partial plan termination, the

nonvested benefits of affected participants will become

vested “to the extent funded.” We believe that a partial

plan termination did occur because of the sale of the

hospitals to Tenet and the sale of Allegheny University

of the Health Sciences. However, because nonvested

accrued benefits under the Plan are not “funded” within

the meaning of this provision, you will not be entitled to

any benefits from the Plan if, as of Nov. 10, 1998, you

have not completed at least five years of vesting service.

Letter from Kasperbauer to Burstein at 1, A233 (emphasis

in original).

7. ERISA outlines the minimum funding standards for employee pension

benefit plans. See 29 U.S.C. § 1082. The Internal Revenue Code also

imposes minimum funding standards for a plan’s qualification for

preferential tax treatment. See 26 U.S.C. § 412.

10

The PBGC and AHERF agreed on September 30, 1999,

that the Plan should be deemed terminated as of August

25, 1999, based on PBGC’s determination that the Plan

would be unable to pay benefits when they became due.

Accordingly, the PBGC took over the Plan on September 30,

1999. See Agreement for Appointment of Trustee and

Termination of Plan, A526-27.

C. Procedural History Leading to the Proposed Second

Amended Complaint

On December 30, 1998, shortly after receiving the letters

from Kasperbauer (but before the PBGC took over the Plan

on September 30, 1999), Burstein filed the initial complaint

in the United States District Court for the Eastern District

of Pennsylvania. The bankruptcy court for the Western

District of Pennsylvania stayed the case in April 1999 at the

request of AHERF ’s bankruptcy trustee. In July 2000, the

bankruptcy court lifted the stay. Burstein filed the First

Amended Complaint on August 10, 2000, and the

defendants moved to dismiss. In addition to opposing the

motion to dismiss, Burstein sought leave to file a proposed

Second Amended Complaint.

D. The Claims in the Second Amended Complaint

The Second Amended Complaint contains eleven counts,

which can be grouped into three categories of claims,8

though, as the district court explained, Burstein did not

fully specify the connection between his claims and the

provisions of ERISA. See Burstein v. Retirement Account

Plan for Employees of Allegheny Health, Education and

Research Foundation, ___ F. Supp. 2d ___, 2002 WL

31319407, at *7 (E.D. Pa. May 30, 2002). The complaint

contains class action allegations, but the issue of class

certification is not before us on appeal in view of the fact

that the district court denied Burstein’s motion to file the

Second Amended Complaint. Because we are reversing on

some counts of the First Amended Complaint, we deem it

8. In addition to the first ten counts that fit within the three categories,

Count XI is a claim for attorneys’ fees. SAC ¶ 207.

11

appropriate for the district court to reconsider its class

certification ruling in light of this opinion.9

Category One: Claims for Plan Benefits (Counts VII-X)

One category of counts (Counts VII-X) in Burstein’s

Second Amended Complaint involves claims for plan

benefits under ERISA § 502(a)(1)(B), 29 U.S.C.

§ 1132(a)(1)(B)10 against the Plan and the PBGC.11

9. The district court denied Burstein’s motion for class certification as

moot in light of its dismissal of the complaint for failure to state a claim.

In view of our disposition, we will reverse the order denying class

certification.

10. This provision of ERISA provides that a plan participant may bring a

civil action “to recover benefits due to him under the terms of his plan,

to enforce his rights under the terms of the plan, or to clarify his rights

to future benefits under the terms of the plan.” 29 U.S.C. § 1132(a)(1)(B).

11. At oral argument, Mr. Eisenhofer, counsel for Burstein, conceded

that, in his view, apart from the Plan and the PBGC, none of the other

defendants were proper defendants with respect to this category of

counts.

THE COURT: . . . I don’t understand how any one of the

defendants you have named can be liable other than the Plan, and

I realize the Plan has very lean pockets.

How do you get Mr. Kasperbauer as a defendant? And he’s the

only administrator that I know of.

MR. EISENHOFER: I believe we get him as defendant on the

breach of fiduciary duty claim.

THE COURT: What about the benefits claim? . . .

MR. EISENHOFER: I don’t believe that Mr. Kasperbauer is an

appropriate — there’s [an] appropriate remedy against Mr.

Kasperbauer on the benefits [claim].

THE COURT: So that the only appropriate defendant in the

category of benefits claim, then, would be the Plan, and you feel that

you should be able to litigate that or go beyond at least the 12(b)(6)

as to the Plan, am I correct?

MR. EISENHOFER: The Plan, and to the extent that PBGC stands

as the successor in interest to the Plan . . .

Tr. of Oral Arg. at 26-27.

12

Count VII asserts that Burstein “became eligible to vest

in 100% of [his] accrued benefits” “[w]hen AHERF partially

terminated the Plan.” SAC ¶¶ 186-189.

Count VIII alleges that the “PBGC is obligated, as the

statutory trustee [i.e., substituted administrator] of the

Plan,” to pay benefits to Burstein. SAC ¶¶ 190-194. As we

explain in note 23, infra, Kasperbauer, at this time, was no

longer the administrator of the Plan, and the Plan had

PBGC as its substitute administrator. As such, PBGC, as

administrator, had the obligation of distributing Plan assets

according to statute. Hence, counsel’s colloquy, reproduced

at note 11, supra, must be understood as relieving all

defendants other than the Plan and the Plan’s present

administrator, PBGC, from liability under the claim for plan

benefits.

Count IX alleges that the “PBGC is statutorily required to

insure the payment of all nonforfeitable benefits.” SAC

¶¶ 195-200.

Count X alleges that because the PBGC collected

premiums from AHERF to insure plan assets, “the PBGC

created an insurer-insured relationship with Plaintiffs”

obligating the PBGC to pay benefits. SAC ¶¶ 201-206.

Taken together, then, Counts VII-X may be read as

claims for plan benefits, but only against the Plan and the

PBGC. (But see infra, where we have held that PBGC may

be liable as substituted administrator but not as a

guarantor. See infra note 23 and Part III(D)).

Category Two: Equitable Estoppel Claim (Count VI)

Count VI alleges an equitable estoppel claim against

Kasperbauer, McConnell, and the Trustees, alleging that

they intended to induce, should have anticipated, or in any

event are responsible for, Burstein’s reliance on

“misrepresentations in the Plan Brochure and SPD.” SAC

¶¶ 179-185.

Category Three: Claims for Breach of Fiduciary Duty

(Counts I-V)

Counts I-V of the Second Amended Complaint allege

various breaches of alleged fiduciary duty. Count I alleges

13

that Kasperbauer, McConnell, and the AHERF Trustees

breached their fiduciary duties to Burstein in violation of

ERISA § 404(a), 29 U.S.C. § 1104(a), by representing,

“through the Plan Brochure, the SPD and/or verbal

communications,” that if the Plan was terminated, all

participants would automatically become vested and

entitled to benefits.

Count II alleges that Kasperbauer, McConnell, Mellon

Bank, and the AHERF Trustees failed to warn Burstein

of AHERF ’s imminent bankruptcy and the Plan’s

underfunding. Further, Count II alleges that the defendants

had failed to warn Burstein that he had been misled about

his benefits under the Plan Brochure and SPD. Count II

charges that such failures to warn constitute a failure to

discharge fiduciary duties.

Count III alleges that Kasperbauer, McConnell, and the

AHERF Trustees mismanaged plan assets “in one of the

most favorable investment climates in history, resulting in

an asset shortfall,” and allowed an “$89 million payment to

Mellon Bank.” SAC ¶¶ 156-61.

Count IV alleges that Mellon Bank mismanaged plan

assets and “improperly influenced AHERF to make an $89

million payment” prior to AHERF ’s bankruptcy filing. SAC

¶¶ 162-72.

Count V alleges that certain AHERF Trustees (Cahouet,

Barnes, Gumberg, Adam, and Fletcher) held positions or

were affiliated with Mellon Bank, and improperly influenced

AHERF to make the $89 million payment to the bank.

Burstein claims that this action breached these Trustees’

fiduciary duties. SAC ¶¶ 173-178.

These claims for breach of fiduciary duty under ERISA

are brought pursuant to ERISA § 502(a)(3)(B), 29 U.S.C.

§ 1132(a)(3)(B). See Varity Corp. v. Howe, 516 U.S. 489, 515

(1996). We discuss these claims infra in Part V.12

12. We note that the Supreme Court has drawn a distinction between

legal and equitable remedies in detailing what remedies are available

under ERISA § 502(a)(3)(B) in its recent decision in Great-West Life &

Annuity Insurance Co. v. Knudson, 534 U.S. 204 (2002).

14

E. The District Court’s Decision

In a memorandum opinion and order dated May 30,

2002, the district court granted all of the defendants’

motions to dismiss the First Amended Complaint with

prejudice for failure to state a claim; denied Burstein’s

motion to file a Second Amended Complaint as futile; and

denied the motion for class certification as moot.

The district court first held that Burstein could not

recover under his claims for plan benefits, citing our

decision in Gridley v. Cleveland Pneumatic Co., 924 F.2d

1310 (3d Cir. 1991). The district court held that, under

ERISA § 502(a)(1)(B), “employees cannot recover from the

Plan[,] benefits which are allegedly granted or due under a

summary plan description [SPD] or other secondary

document.” Burstein, ___ F. Supp. 2d ___, 2002 WL

31319407, at *7 (citing Gridley, 924 F.2d at 1318). Under

the district court’s reading of Gridley, because the explicit

terms of the Plan Document itself did not provide Burstein

with a right to benefits, Burstein could not rely on terms of

the SPD to assert a claim for benefits.

The district court next dismissed Burstein’s equitable

estoppel claim, questioning whether the elements of an

equitable estoppel claim could be satisfied, but holding that

Burstein had no standing to enforce the Plan against the

defendants named in this count.

Finally, the district court dismissed all of the breach of

fiduciary claims, holding that all but one of the defendants,

though named fiduciaries, were not fiduciaries for the

purposes of events identified by Burstein that could give

rise to claims for breach of fiduciary duty. As to the claims

against Kasperbauer, the administrator, for breach of

fiduciary duty relating to alleged misrepresentations in the

SPD and Plan brochure, the district court held that

Burstein might have been able to state a claim if he had

alleged that there was reliance to his detriment on the

alleged misrepresentations. Holding that no such

detrimental reliance had been pled, the district court

dismissed the claim against Kasperbauer.

Burstein filed a timely notice of appeal on June 13, 2002.

This appeal followed.

15

II.

The district court had subject matter jurisdiction of this

civil action arising under ERISA pursuant to 29 U.S.C.

§ 1132(f) and 28 U.S.C. § 1331, and, with respect to claims

against the PBGC, pursuant to 29 U.S.C. § 1303(f). We have

jurisdiction over this appeal from the district court’s final

judgment pursuant to 28 U.S.C. § 1291.

We have plenary review of the district court’s grant of a

motion to dismiss for failure to state a claim pursuant to

Fed. R. Civ. P. 12(b)(6). See Nami v. Fauver, 82 F.3d 63, 65

(3d Cir. 1996). In considering an appeal of a granted Rule

12(b)(6) motion, we do not analyze whether Burstein will

ultimately prevail, but only whether he is entitled to offer

evidence to support his claims, attributing all reasonable

inferences in favor of Burstein. Thus, we will affirm the

district court’s order granting the defendants’ motion to

dismiss only if it appears that Burstein could prove no set

of facts that would entitle him to relief. See Conley v.

Gibson, 355 U.S. 41, 45-46 (1957); Nami, 82 F.3d at 65.13

III.

We first examine the district court’s dismissal of

Burstein’s claims for plan benefits. (Category One —

Counts VII - X).

A.

Burstein alleges that language in both the Plan Brochure

and the Summary Plan Description gave rise to his claims

for plan benefits. The complaint alleges that the Plan

Brochure “conveys the impression that each participant has

a funded ‘account’ under the Plan in which they accrue

13. We review a district court’s decision denying leave to file an amended

complaint for abuse of discretion. See, e.g., Bailey v. United Airlines, 279

F.3d 194, 203 (3d Cir. 2002). Our determination that the district court

should allow Burstein to file a Third — and final — Amended Complaint

results from our holding that the district court erred in dismissing the

entire complaint for failure to state a claim, and should not be read as

critical of the district court’s denial of leave to amend. See infra note 32.

16

retirement benefits.” SAC ¶ 75. Specifically, Burstein points

to the Plan Brochure’s statements that:

“AHERF contributes to your account each year based

on your pay, age and service. Your account earns

interest at a guaranteed individual rate.” . . . [and]

“You have your own interest bearing account that is

completely funded by the organization.”

Id.

In addition, Burstein cited statements in the Plan

Brochure such as:

• “Retirement Account Plan 100% funded by AHERF ”;

• “You own your account after five years”;

• “You always own your account”; and

• “Guaranteed Interest . . . the minimum amount

your account will earn is 5% per year . . . You will

receive an account statement at least once a year

showing how your account has grown.”

SAC ¶ 76.14

The complaint alleged that the Summary Plan

Description “reinforces the impression created by the Plan

Brochure that each participant had a fully funded account

in which retirement benefits were accrued and grew each

year,” SAC ¶ 83, and cites various statements describing

how “your account is credited.” Id. The SPD states:

A special account is used to record your annual

retirement credits and other increases in your benefit

14. The Plan Brochure to which Burstein refers is significantly different

and less detailed than the SPD or the Plan Document itself. A plan

brochure is distinct from a plan document in that it is neither

comprehensive or detailed, and is more akin to a commonplace flyer.

Whereas Congress has expressed its intent with respect to SPDs, it has

not expressed any such intent with respect to plan brochures. See 29

U.S.C. § 1022; see also discussion infra at pages 22-24. Accordingly, a

plan brochure cannot form the basis for plan benefits. Although Burstein

has pointed to language in the Plan Brochure, our decision here pertains

only to the SPD, not to the Plan Brochure.

17

amount. While your account balance under the

Retirement Account Plan is a way of expressing your

plan benefit, no plan assets are specifically allocated to

your plan account. Instead they are held in a trust for

all participants.

SAC ¶ 86. The complaint alleges that though a reader “may

understand from this language . . . that the funds . . . are

not held separately,” nonetheless such a reader would

interpret the language “to mean that sufficient assets to

fund the individual account balances have been set aside

and are held in trust.” Id.

The complaint alleges that the SPD explains that once a

participant is vested, he or she has “a nonforfeitable right

to the value of [his or her] account.” SAC ¶ 87 (quoting SPD

at 14, A208). In general, under the Plan, a participant is

not deemed vested until he or she has completed five years

of service. Central to this case, however, the SPD provides

that a plan participant will become vested upon the

termination of the Plan:

If the Plan is terminated you will automatically become

vested in your account, regardless of how many years

of service you have earned. No more annual retirement

credits will be made to your account, but you will

continue to receive interest credits until payments from

your account begin.

SAC ¶ 87 (quoting SPD at 25, A219) (emphasis added).

By contrast, the language of the Plan Document imposes

a significant qualification on a Plan participant’s vesting in

his or her account:

Upon the termination or partial termination of the

Plan, the right of all affected participants to benefits

accrued to the date of such termination or partial

termination shall become nonforfeitable (within the

meaning of Treas. Reg. § 1.411(a)-4) to the extent

funded as of such date.

Plan § 16.2, A400 (emphasis added).15

15. We note that this Plan Document language is patterned after

§ 411(d)(3) of the Internal Revenue Code, which states that a plan will

not be qualified for preferential tax treatment unless it:

18

The SPD differed from the Plan Document in the way it

described the terms of vesting and funding. In this case,

however, AHERF — presumably by design — funded the

Plan at the minimum level permissible under ERISA. These

minimum ERISA funding standards did not require AHERF

to fund the Plan for those participants who had not yet met

the five-year service requirement for vesting.16

B.

The district court held that the conflict between the terms

of the SPD and the terms of the Plan Document did not

permit Burstein to state a claim that he was “due” benefits

within the meaning of ERISA § 502(a)(1)(B). The district

court grounded this conclusion on its interpretation of our

decision in Gridley v. Cleveland Pneumatic Co., 924 F.2d

1310 (3d Cir.), cert. denied, 501 U.S. 1232 (1991). The

district court read Gridley to hold that a court must only

look to the Plan Document, and therefore determined that

the language contained in the SPD could not operate to

create a right to plan benefits.

On appeal, Burstein argues that the district court

misinterpreted Gridley. He argues that an SPD can be

considered in assessing what benefits are “due” under a

claim for plan benefits pursuant to ERISA § 502(a)(1)(B).

Kasperbauer and the PBGC take the contrary position that

provides that—

(A) upon its termination or partial termination, or

(B) in the case of a plan to which section 412 does not apply,

upon complete discontinuance of contributions under the plan,

the rights of all affected employees to benefits accrued to the date of

such termination, partial termination, or discontinuance, to the extent

funded as of such date, or the amounts credited to the employees’

accounts, are nonforfeitable. . . .

26 U.S.C. § 411(d)(3) (emphasis added).

16. As we have noted, there is no allegation that the way in which the

Plan was funded violated ERISA’s funding requirements. We also are not

informed whether it is typical that a plan sponsor will fund a plan at the

minimum level that ERISA permits.

19

Gridley has “squarely held” that an SPD cannot allow for

recovery of benefits under § 1132(a)(1)(B). Kasperbauer Br.

at 29-30; see also PBGC Br. at 12 n.8 (also citing Gridley).

After a careful and thorough review of Gridley, we have

concluded that the language in Gridley on which the

district court relied constitutes dictum, and therefore does

not bind us in determining whether a conflict between an

SPD and a plan document can give rise to a claim for plan

benefits.17

In Gridley, this Court examined the availability of certain

benefits under a life insurance plan. Gridley, 924 F.2d at

1311. Gridley based her claim on language in an “overview

brochure” that conflicted with, or was silent about,

additional requirements contained in the plan document

language. Id. at 1314.

The district court held in favor of Gridley on the grounds

that the brochure constituted a “summary plan

description,” the terms of which were enforceable. Id. at

1315. The Gridley Court reversed the district court’s

decision, “both because the new overview brochure. . . was

not a summary plan description and because a summary

plan description is not a ‘plan’ within the meaning of

Section 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B).” Id. at 1316.

The Court explained that the overview brochure on which

Mrs. Gridley based her claim did not constitute a “summary

plan description” for several reasons:

First, the new overview brochure . . . contains an

important internal reference to “summary plan

descriptions.” . . .

Second, the new overview brochure . . . lacks virtually

all of the categories of information required by ERISA

for summary plan descriptions. Under 29 U.S.C.

§ 1022(b), a summary plan description must contain

12 categories of information . . . The new overview

17. See Third Circuit Internal Operating Procedure 9.1 (“It is the

tradition of this court that the holding of a panel in a precedential

opinion is binding on subsequent panels. Thus, no subsequent panel

overrules the holding in a precedential opinion of a previous panel. Court

en banc consideration is required to do so.”).

20

brochure’s . . . description of the life insurance plans,

however, lacks any information relating to all but two

of these categories . . .

Third, the new overview brochure . . . contains

extraordinarily perfunctory descriptions of subjects

treated in other company documents that

unquestionably constituted summary plan

descriptions. . . .

Finally, the new overview brochure . . . was plainly an

updated version of the earlier overview brochure . . .

which was not a summary plan description. As already

noted, when Mr. Gridley received the earlier overview

brochure . . . at the beginning of his employment, he

was also given summary plan descriptions for some of

the company’s plans. In light of these detailed

documents, there can be no doubt that the cursory

descriptions of the same plans in the earlier overview

brochure . . . did not constitute the summary plan

descriptions for those plans.

Id. at 1316-17 (citations and footnote omitted).

Thus, in Gridley we held no more than: Gridley could not

recover benefits because there was no summary plan

description on which to base her claim, since the overview

brochure on which she relied did not constitute an SPD.

Our holding in Gridley that there was no SPD cannot be

read as stating that the terms of a plan document override

the language of the SPD where they conflict. This being so,

Gridley is not a holding that the plan document is superior

to, or trumps, the SPD, and accordingly, it cannot bind us

to this principle as precedent.

It is true that Gridley does discuss the term “plan” as it

appears in ERISA, and claims that it does not encompass

a summary plan description. See id. at 1318. However,

once Gridley held that no summary plan description

existed, its discussions as to the place of a summary plan

description in the statutory scheme can constitute no more

than dictum. And while the district court understandably

may have been influenced by that dictum, neither we nor

the district court are bound to respect it as precedent.

21

Our understanding of Gridley is fortified by the decisions

of several other Circuits, all of which have held that a

summary plan description will govern over contradictory or

conflicting terms in the Plan Document. For example, the

Eleventh Circuit has declared, in a much-cited opinion:

It is of no effect to publish and distribute a plan

summary booklet designed to simplify and explain a

voluminous and complicated document, and then

proclaim that any inconsistencies will be governed by

the plan. Unfairness will flow to the employee for

reasonably relying on the summary booklet.

McKnight v. Southern Life and Health Ins. Co., 758 F.2d

1566, 1570 (11th Cir. 1985).

The Second Circuit has agreed with this view of the

summary plan description:

[O]nly the Booklet, not the Plan itself, was distributed

to employees. The Booklet purported to summarize the

Plan. ERISA and the regulations promulgated under it

require that employees be given such summaries. . . .

Thus, the statute contemplates that the summary will be

an employee’s primary source of information regarding

employment benefits, and employees are entitled to rely

on the descriptions contained in the summary. To allow

the Plan to contain different terms that supersede the

terms of the Booklet would defeat the purpose of

providing the employees with summaries.

Heidgerd v. Olin Corp., 906 F.2d 903, 907-08 (2d Cir. 1990)

(citing 29 U.S.C. § 1022; 29 C.F.R. § 2520.102-2(a) (1989)).

In addition to the Eleventh and Second Circuits, the

Fourth, Fifth, Sixth, Seventh, Eighth, Ninth, and Tenth

Circuits have all adopted similar views (though somewhat

varying in scope, precise context, and extent) that if the

SPD language differs from or conflicts with the plan

language, it is the SPD language that will control.18

18. See Pierce v. Security Trust Life Ins. Co., 979 F.2d 23, 27 (4th Cir.

1992) (per curiam) (“if there was a conflict between the complexities of

the plan’s language and the simple language of the SPD, the latter would

control”); Hansen v. Continental Ins. Co., 940 F.2d 971, 982 (5th Cir.

22

Today, we join with the other Courts of Appeals that have

considered this issue, and hold that, where a summary

plan description conflicts with the plan language, it is the

summary plan description that will control. We are satisfied

that this holding, as we have stated it, is faithful to

Congressional intent. The ERISA provision governing

summary plan descriptions expresses Congress’s desire

that the SPD be transparent, accurate, and comprehensive:

A summary plan description of any employee benefit

plan shall be furnished to participants and

beneficiaries as provided in section 1024(b) of this title.

The summary plan description shall include the

information described in subsection (b) of this section,

shall be written in a manner calculated to be

understood by the average plan participant, and shall

be sufficiently accurate and comprehensive to

reasonably apprise such participants and beneficiaries

of their rights and obligations under the plan. A

1991) (“the summary plan description is binding, and . . . if there is a

conflict between the summary plan description and the terms of the

policy, the summary plan description shall govern. Any other rule would

be, as the Congress recognized, grossly unfair to employees and would

undermine ERISA’s requirement of an accurate and comprehensive

summary.”); Edwards v. State Farm Mut. Auto Ins. Co., 851 F.2d 134,

136 (6th Cir. 1988) (“statements in a summary plan are binding and if

such statements conflict with those in the plan itself, the summary shall

govern”); Senkier v. Hartford Life & Acc. Ins. Co., 948 F.2d 1050, 1051

(7th Cir. 1991) (“The insured is protected by the fact that, in the event

of a discrepancy between the coverage promised in the summary plan

document and that actually provided in the policy, he is entitled to claim

the former.”); Barker v. Ceridian Corp., 122 F.3d 628, 633 (8th Cir. 1997)

(“Summary plan descriptions are considered part of ERISA plan

documents. . . . Adequate disclosure to employees is one of ERISA’s

major purposes. . . . Because of the importance of disclosure, in the

event of a conflict between formal plan provisions and summary plan

provisions, the summary plan description provisions prevail.”) (citations

omitted); Atwood v. Newmont Gold Co., 45 F.3d 1317, 1321 (9th Cir.

1995) (“Where the SPD . . . differs materially from the terms of the plan,

the SPD is controlling.”); Chiles v. Ceridian Corp., 95 F.3d 1505, 1515

(10th Cir. 1996) (“Because the SPD best reflects the expectations of the

parties to the plan, the terms of the SPD control the terms of the plan

itself.”).

23

summary of any material modification in the terms of

the plan and any change in the information required

under subsection (b) of this section shall be written in

a manner calculated to be understood by the average

plan participant and shall be furnished in accordance

with section 1024(b)(1) of this title.

29 U.S.C. § 1022(a) (emphasis added).19 See also 29 U.S.C.

§ 1022(b) (setting forth information that must be included

in an SPD). Indeed, § 1022(b) requires that an SPD provide

“the plan’s requirements respecting eligibility for

participation and benefits; a description of the provisions

providing for nonforfeitable pension benefits; [and]

circumstances which may result in disqualification,

ineligibility, or denial or loss of benefits.” Id.

Thus, “ERISA requires, in no uncertain terms, that the

summary plan description be ‘accurate’ and ‘sufficiently

comprehensive to reasonably apprise’ plan participants of

their rights and obligations under the plan.” Hansen, 940

F.2d at 981 (quoting 29 U.S.C. § 1022). The SPD is the

document to which the lay employee is likely to refer in

obtaining information about the plan and in making

decisions affected by the terms of the plan. Indeed, the SPD

in this case suggests that the Plan Document is not

provided to employees as a matter of course, but must be

either inspected on AHERF ’s designated premises or

requested in writing. The front page of the SPD, after

explaining that the “[P]lan [D]ocument always governs” if

there is a difference between the SPD “booklet” and the

“official [P]lan [D]ocument,” describes how and where a

participant may read the official Plan Document:

You may look at the [P]lan [D]ocument during regular

business hours at the Allegheny Health, Education and

Research Foundation, Benefit Service Center, Suite

260, One Allegheny Center, Pittsburgh, Pennsylvania

15512-5408. You also may obtain a copy of the official

[P]lan [D]ocument by writing to the Benefit Service

19. Section 1024(b) provides detailed requirements as to how a plan

administrator must publish and furnish summary plan descriptions to

plan participants or beneficiaries.

24

Center. A small charge may be made to cover the

copying costs.

SPD at 1, A195. The relative inaccessibility of AHERF ’s

Plan Document serves to highlight that, as Congress

intended, the SPD is the primary document on which plan

participants must rely.

Some of the defendants-appellees argue that an SPD is,

by its nature, a summary, and cannot include all the terms

contained in the full Plan. Of course this is so, and it would

defeat the purposes of having a summary of a full plan

document if the SPD were to parrot all the terms of the

plan document. In this case, however, the conflict between

the SPD and the Plan Document is unquestionably

material. The SPD indicates to the Plan participant that the

Plan assets are held in a trust and that benefits will

“automatically vest” upon Plan termination. But, as we

have earlier noted, the Plan Document here does not

provide for full funding or for unqualified vesting. The fact

that the AHERF Retirement Account plan would not be fully

funded is never expressed in the Summary Plan

Description.

As we have explained, the SPD states, “If the plan is

terminated you will automatically become vested in your

account, regardless of how many years of service you have

earned.” SPD at 25, A219 (emphasis added). By contrast,

the Plan says:

Upon the termination or partial termination of the Plan,

the rights of all affected participants to benefits

accrued to the date of such termination or partial

termination shall become nonforfeitable (within the

meaning of Treas. Reg. § 1.411(a)-4) to the extent

funded as of such date.

Plan § 16.2, A400 (emphasis added).

The difference that exists between the SPD and the Plan

Document respecting how much would be available to a

vested participant is not only stark but presents a material

conflict that the PBGC does not address. It does not

address that conflict because, under its reading of Gridley,

it is the Plan Document that governs, whereas under our

25

interpretation and reading of Gridley, it is the SPD that

governs. Hence, where the PBGC finds no conflict — we do.

The PBGC’s argument that the SPD is “silent” with respect

to partial termination is unavailing. We are satisfied that “[i]f

the plan is terminated,” that termination applies with equal

force to a completed termination as well as to a partial

termination of the Plan. Thus, we reject the PBGC’s

argument that no conflict exists.

C.

We also conclude that a plan participant who seeks to

claim plan benefits on the basis of a conflict between an

SPD and a plan document need not plead reliance on the

SPD. We recognize that other Courts of Appeals that have

spoken to this issue have taken differing positions on this

question.

The Eleventh Circuit, for example, has declared: “We . . .

hold that, to prevent an employer from enforcing the terms

of a plan that are inconsistent with those of the plan

summary, a beneficiary must prove reliance on the

summary.” Branch v. G. Bernd Co., 955 F.2d 1574, 1579

(11th Cir. 1992). The First, Fourth, and Seventh Circuits

have similarly required reliance.20

The Sixth Circuit, by contrast, has disclaimed the

necessity of reliance. In Edwards v. State Farm Mutual Auto

Ins. Co., 851 F.2d 134 (6th Cir. 1988), the Sixth Circuit

explained that, “[a]lthough in the instant case, the appellee

20. See Govoni v. Bricklayers, Masons and Plasterers Int’l Union, 732

F.2d 250, 252 (1st Cir. 1984) (“[c]ase law suggests . . . that to secure

relief, Govoni must show some significant reliance upon, or possible

prejudice flowing from, the faulty plan description”); Aiken v. Policy

Mgmt. Sys. Corp., 13 F.3d 138, 141-42 (4th Cir. 1993) (holding that

showing of reliance or prejudice necessary, but reversing and remanding

district court’s grant of summary judgment against plan participant for

“for further development of the record on the issue of reliance or

prejudice”); Health Cost Controls of Illinois, Inc. v. Washington, 187 F.3d

703 (7th Cir. 1999) (if “the plan and the summary plan description

conflict, the former governs . . . unless the plan participant or

beneficiary has reasonably relied on the summary plan description to his

detriment”), cert. denied, 528 U.S. 1136 (2000).

26

relied to his detriment . . . existing precedent does not

dictate that a claimant who has been misled by summary

descriptions must prove detrimental reliance. Congress has

promulgated clear directives prohibiting misleading

summary descriptions. This court elects not to undermine

the legislative command by imposing technical

requirements upon the employee.” Id. at 137.

The Second Circuit has not provided a definitive answer

to this question. In Feifer v. Prudential Insurance Co. of

America, 306 F.3d 1202 (2d Cir. 2002), that court stated,

“Unlike most other circuits, this Court has not yet decided

whether a showing of these factors [i.e., reliance or

prejudice] is ever necessary for a plaintiff to succeed in an

action brought under ERISA.” Id. at 1213. The Fifth Circuit

has also avoided answering the question. See Rhorer v.

Raytheon Engineers and Constructors, Inc., 181 F.3d 634,

644 n.12 (5th Cir. 1999) (“This Court has never held that

an ERISA claimant must prove reliance on a summary plan

description in order to prevail on a claim to recover

benefits,” and also explaining that precedent had

acknowledged the reliance issue but had not resolved

whether reliance is a necessary element).

Upon consideration of the “reliance” issue, we now hold

that a plan participant who bases a claim for plan benefits

on a conflict between an SPD and plan document need

neither plead nor prove reliance on the SPD.

Claims for ERISA plan benefits under ERISA

§ 502(a)(1)(B) are contractual in nature. Cf. Feifer, 306 F.3d

at 1210 (“A claim under § 1132(a)(1)(B), ‘in essence, is the

assertion of a contractual right.’ . . . In interpreting plan

terms for purposes of claims under § 1132(a)(1)(B), we apply

a federal common law of contract, informed both by general

principles of contract law and by ERISA’s purposes as

manifested in its specific provisions.”) (quoting Strom v.

Goldman, Sachs & Co., 202 F.3d 138, 142 (2d Cir. 1999)).

Our determination that a SPD controls over the plan

document where the two conflict does not change the

contractual character of these claims. Instead, our holding

recognizes that because Congress requires that an SPD be

“sufficiently accurate and comprehensive to reasonably

27

apprise . . . participants . . . of their rights and obligations,”

29 U.S.C. § 1022(a), the SPD serves as a summary of the

contract’s (i.e., the plan document’s) key terms. If an SPD

conflicts with a plan document, then a court should read

the terms of the “contract” to include the terms of a plan

document, as superseded and modified by conflicting

language in the SPD. And, just as a court’s enforcement of

a contract generally does not require proof that the parties

to the contract actually read, and therefore relied upon, the

particular terms of the contract, we are persuaded that

enforcement of an SPD’s terms under a claim for plan

benefits does not require a showing of reliance.21 As the

Second Circuit has explained,

[W]e are unaware of caselaw to the effect that a plaintiff

must show reliance or prejudice to enforce terms of a

plan. Such a limitation on the reliance or prejudice

requirement is consistent with the principle that an

action under ERISA to enforce plan terms sounds in

contract, and a plaintiff generally need not show

equitable factors such as reliance or prejudice to

enforce contractual terms.

Feifer, 306 F.3d at 1202.22 Based upon our view of

Congress’s intent, an SPD furnishes the plan’s terms to the

extent that it conflicts with (and thus supersedes) the

language of a formal plan document. We thus hold that, in

enforcing an SPD’s terms, a participant does not need to

plead reliance or prejudice, since the claim for plan benefits

under ERISA § 502(a)(1)(B) is contractual.

Accordingly, in light of our conclusion that a summary

plan description controls over a plan document where the

two conflict, and thus serves as a source for benefits due

21. Indeed, as the Second Circuit has noted, “those courts that have

imposed requirements such as reliance or prejudice did so only where

plaintiffs sought to enforce provisions other than those that the court

deemed ‘plan’ terms.” Feifer, 306 F.3d at 1213 (citing, inter alia, Gridley).

22. In Feifer, the Second Circuit did not deal with an SPD that conflicted

with a formal plan document; rather, it treated the relevant summary

documents in the case before it as constituting the plan. See Feifer, 306

F.3d at 1202 (“the Program Summary (with the accompanying

memorandum) was the plan”) (emphasis in original).

28

under an ERISA plan, we hold that Burstein has stated a

claim against the Plan itself for plan benefits and thus

against the PBGC as administrator.23

D.

We reach a different conclusion as to claims against the

PBGC in its role as guarantor. As the district court

concluded, see Burstein, ___ F. Supp. 2d ___, 2002 WL

31319407, at *9, the statute governing the PBGC’s

guarantee of benefits does not require PBGC to guarantee

the benefits at issue here.

The Supreme Court has outlined the limited role of the

PBGC as guarantor:

When a plan covered under Title IV terminates with

insufficient assets to satisfy its pension obligations to

the employees, the PBGC becomes trustee of the plan,

taking over the plan’s assets and liabilities. The PBGC

then uses the plan’s assets to cover what it can of the

benefit obligations. . . . The PBGC then must add its

own funds to ensure payment of most of the remaining

“nonforfeitable” benefits, i.e., those benefits to which

participants have earned entitlement under the plan

terms as of the date of termination. ERISA does place

limits on the benefits PBGC may guarantee upon plan

termination, however, even if an employee is entitled to

greater benefits under the terms of the plan. . . .

Finally, active plan participants (current employees)

cease to earn additional benefits under the plan upon

its termination and lose entitlement to most benefits not

yet fully earned as of the date of plan termination.

23. Because Kasperbauer ceased to be the administrator of the Plan once

the Plan was terminated, the PBGC was obliged to take over the

administration of the Plan. To the extent that the PBGC took the place

of the Plan administrator, Burstein, if he was to prove that benefits are

due him under the language of the SPD, could seek to enforce his claim

for benefits against the Plan, with PBGC as its administrator. In such a

case, PBGC, as Plan administrator, would allocate funds from Plan

assets pursuant to the asset allocation priorities contained in 29 U.S.C.

§ 1344.

29

Pension Ben. Guar. Corp. v. LTV Corp., 496 U.S. 633, 637-

38 (1990) (emphasis added) (citations omitted).

The statutory provision covering the single-employer plan

guarantee, 29 U.S.C. § 1322, provides as follows:

Subject to the limitations contained in subsection (b) of

this section, the [PBGC] shall guarantee, in accordance

with this section, the payment of all nonforfeitable

benefits (other than benefits becoming nonforfeitable

solely on account of the termination of a plan) under a

single-employer plan which terminates at a time when

this subchapter applies to it.

29 U.S.C. § 1322(a) (emphasis added).

The bold text above, which qualifies the statutory

guarantee requirement, is directly applicable to this

situation. PBGC’s obligation to guarantee certain benefits

does not apply to benefits that have become nonforfeitable

solely on account of the termination of the plan.24 The

benefits claimed by Burstein, even if due under the Plan by

virtue of the SPD’s language, would have become

“nonforfeitable” (vested) solely due to the plan’s partial

termination. See SPD at 25, A219 (“If the Plan is terminated

you will automatically become vested in your account,

regardless of how many years of service you have earned.”)

(emphasis added).25

Under the plain terms of 29 U.S.C. § 1322(a), the PBGC,

in its guaranty role, is not responsible for guaranteeing or

insuring plan benefits that become vested solely as a result

of a plan termination. We hold that here, where the

complaint may be read only to allege that the claimed

benefits vested as a result of the partial termination,

§ 1322(a)’s exception for benefits that “become

nonforfeitable solely on account of the termination of a

24. A “nonforfeitable benefit” means “a benefit for which a participant

has satisfied the conditions for entitlement under the plan or the

requirements of this chapter.” 29 U.S.C. § 1301(a)(8). See also Mead

Corp. v. Tilley, 490 U.S. 714, 717 n.1 (1989) (quoting same).

25. As we explained supra, the SPD’s language relating to “termination”

encompasses “partial termination” for the purpose of examining whether

benefits were due under the Plan.

30

plan” applies with equal force to benefits that have become

nonforfeitable solely on account of a partial termination of a

plan that is later terminated.

We therefore conclude that Burstein has failed to state a

claim against the PBGC, in its role as guarantor. Section

1322(a) precludes the federal courts from ordering as relief

to Burstein the payment of these benefits out of PBGC’s

own guarantee funds. Accordingly, we will affirm the

district court’s dismissal of claims against PBGC as

guarantor.

IV.

Burstein also seeks relief under an equitable estoppel

theory against Kasperbauer, McConnell, and the AHERF

trustees. This claim arises under Count VI, which we have

characterized as Category Two. We have held that to state

a cause of action for equitable estoppel under ERISA

§ 502(a)(3), 29 U.S.C. § 1132(a)(3), an “ERISA plaintiff must

establish (1) a material representation, (2) reasonable and

detrimental reliance upon the representation, and (3)

extraordinary circumstances.” Curcio v. John Hancock Mut.

Life Ins. Co., 33 F.3d 226, 235 (3d Cir. 1994).

First and foremost, Burstein has alleged no extraordinary

circumstances. We have held that “ ‘extraordinary

circumstances’ generally involve acts of bad faith on the

part of the employer, attempts to actively conceal a

significant change in the plan, or commission of fraud.”

Jordan v. Federal Express Corp., 116 F.3d 1005, 1011 (3d

Cir. 1997). None has been alleged here. Furthermore, “we

have consistently rejected estoppel claims based on simple

ERISA reporting errors or disclosure violations, such as a

variation between a plan summary and the plan itself, or an

omission in the disclosure documents.” Kurz v. Philadelphia

Elec. Co., 96 F.3d 1544, 1553 (3d Cir. 1996) (emphasis

added).

Moreover, we are aware that the district court held that

equitable estoppel claims could not run in any event

against Kasperbauer, McConnell, or the AHERF Trustees,

because these defendants have no power over, or present

relationship to, the Plan. Hence, Burstein had no claim

31

against them under an equitable estoppel theory, which

sought to estop them from enforcing the Plan in any

manner other than in accordance with the SPD.

Additionally, Burstein did not argue on appeal that

equitable estoppel applied to the PBGC. We hold that the

district court did not err in dismissing Burstein’s equitable

estoppel claims.

V.

We will affirm the district court’s dismissal of all but one

of the claims for breach of fiduciary duty. Counts I-V of the

complaint, which we have characterized as Category Three,

deal with alleged breaches of fiduciary duty.

ERISA sets out certain obligations for fiduciaries.26 Under

ERISA § 502(a)(3)(B), 29 U.S.C. § 1132(a)(3)(B), a plan

participant may have a cause of action for a breach of

fiduciary duty.27 To allege and prove a breach of fiduciary

duty for misrepresentations,

26. Under ERISA, a fiduciary:

shall discharge his duties with respect to a plan solely in the

interest of the participants and beneficiaries and—

(A) for the exclusive purpose of:

(I) providing benefits to participants and their beneficiaries; and

(ii) defraying reasonable expenses of administering the plan;

(B) with the care, skill, prudence, and diligence under the

circumstances then prevailing that a prudent man acting in a like

capacity and familiar with such matters would use in the conduct

of an enterprise of a like character and with like aims; . . .

(D) in accordance with the documents and instruments governing

the plan insofar as such documents and instruments are consistent

with the provisions of this subchapter and subchapter III of this

chapter.

29 U.S.C. § 1104(a).

27. Section 502(a)(3) of ERISA provides that a plan participant may bring

a civil action “(A) to enjoin any act or practice which violates any

provision of this subchapter or the terms of the plan, or (B) to obtain

other appropriate equitable relief.” 29 U.S.C. § 1132(a)(3).

32

a plaintiff must establish each of the following

elements: (1) the defendant’s status as an ERISA

fiduciary acting as a fiduciary; (2) a misrepresentation

on the part of the defendant; (3) the materiality of that

misrepresentation; and (4) detrimental reliance by the

plaintiff on the misrepresentation.

Daniels v. Thomas & Betts Corp., 263 F.3d 66, 73 (3d Cir.

2001). We evaluate the dismissal of the breach of fiduciary

duty claims with this framework in mind.

A.

The district court rejected all of Burstein’s breach of

fiduciary duty claims, holding that Burstein failed to state

a claim. We agree with the district court as to all but one

of the breach of fiduciary duty claims.

“ERISA . . . defines ‘fiduciary’ not in terms of formal

trusteeship, but in functional terms of control and authority

over the plan.” Mertens v. Hewitt Associates, 508 U.S. 248,

262 (1993). As the district court properly noted, “[f]iduciary

duties ‘attach not just to particular persons, but to

particular persons performing particular functions.’ ”

Burstein, ___ F. Supp. 2d ___, 2002 WL 31319407, at *15

(quoting Hozier v. Midwest Fasteners, Inc., 908 F.2d 1155,

1158 (3d Cir. 1990)). “[U]nder ERISA, a person ‘is a

fiduciary with respect to a plan’ only ‘to the extent’ that ‘he

has any discretionary authority or discretionary

responsibility in the administration of such plan.’ ” Varity

Corp., 516 U.S. at 527 (quoting 29 U.S.C. § 1002(21)(A)(iii));

see also Confer v. Custom Eng’g Co., 952 F.2d 34, 36 (3d

Cir. 1991) (“In determining who is a fiduciary under ERISA,

courts consider whether a party has exercised discretionary

authority or control over a plan’s management, assets, or

administration.”).

The district court dismissed Counts II through V,

inclusive, and Count I as to all named defendants but

Kasperbauer, based on its analysis of those defendants’

functions with respect to the Plan. Count I, against

Kasperbauer, McConnell, and the AHERF Trustees, was for

misrepresentations based on the SPD, Plan Brochure, and

verbal representations. Count II, against Kasperbauer,

33

McConnell, the AHERF Trustees, and Mellon Bank, was for

“failure to disclose material information.” Counts III-V

alleged “mismanagement of plan assets.”28

After an independent and careful review of the record, we

are satisfied that the district court’s analysis respecting all

of Burstein’s claims against Kasperbauer, McConnell, the

AHERF Trustees,29 and Mellon Bank, except for Count I as

to Kasperbauer, was correct. The district court properly

dismissed these claims either because the defendants other

than Kasperbauer did not hold fiduciary positions that

could render them liable, or because the assets alleged to

be Plan assets were not Plan assets. Except for the claims

that Burstein has alleged against Kasperbauer and that

pertain to Kasperbauer’s fiduciary responsibilities, we have

considered Burstein’s “breach of fiduciary duty” arguments

on appeal against the other defendants and conclude that

they are without merit. We also conclude that Burstein’s

claims against Kasperbauer, other than the claims in Count

I (misrepresentation), were properly dismissed by the

district court.

B.

With respect to Count I (“Claim . . . for Breach of

Fiduciary Duties — Misrepresentation”), the district court

stated that Kasperbauer, as Plan administrator, “was

clearly a fiduciary . . . for purposes of . . . communicating

with plan participants.” Burstein, ___ F. Supp. 2d ___, 2002

WL 31319407, at *16. Kasperbauer does not dispute his

fiduciary status for these purposes.

In analyzing whether Burstein had stated a claim against

28. Count III named Kasperbauer, McConnell, and the AHERF Trustees

as defendants. Count IV named Mellon Bank. Count V named particular

AHERF Trustees: Cahouet, Barnes, Gumberg, Adam, and Fletcher.

29. As we have stated, the AHERF Trustees named in the complaint are

William F. Adam, J. David Barnes, Ralph W. Brenner, Dorothy McKenna

Brown, Frank V. Cahouet, Douglas D. Danforth, Ronald R. Davenport,

Harry R. Edelman, III, Robert L. Fletcher, Ira J. Gumberg, Robert M.

Hernandez, Francis B. Nimick, Robert B. Palmer, David W. Sculley, and

W.P. Snyder, III. See note 4, supra.

34

Kasperbauer, the district court looked to our decision in In

re Unisys Corp. Retiree Medical Ben. ERISA Litigation

(Unisys II), 57 F.3d 1255 (3d Cir. 1995), cert. denied, 517

U.S. 1103 (1996), in which we described the elements of an

ERISA breach of fiduciary duty claim as “proof of fiduciary

status, misrepresentations, company knowledge of the

confusion and resulting harm to the employees.” Id. at

1265.

As noted above, the district court determined that the

“proof of fiduciary status” element had been met. The

district court also held, and Kasperbauer does not

challenge on appeal, that statements in the SPD and Plan

Brochure could be misleading, thus meeting the

“misrepresentation” element.30

30. The district court stated:

With regard to the content of the SPD, the court cannot say as a

matter of law that the statement that participants would vest in their

accounts upon termination regardless of how many years of service

they had completed, without advising participants that they only

received a vested right to those accounts to the extent funded, is not

a “material misrepresentation” or “incomplete, inconsistent, or

contradictory disclosure.” A factfinder could reasonably conclude

based on the unqualified statement in the SPD that participants who

had not otherwise vested could reasonably expect to receive the value

of their account upon termination, regardless of whether the Plan was

adequately funded. . . . Further, in light of the conclusion that the

disclosures in the SPD may qualify as incomplete disclosures, the

court cannot say as a matter of law that the lack of information

regarding Plan termination in the Plan Brochure was not also a

material omission. . . .

We reach the same conclusion with regard to statements in the SPD

and the [Plan] Brochure that plaintiffs claim led them to believe that

they had individual accounts and a nonforfeitable right to the funds

in those accounts. Although the SPD unambiguously explained that

the accounts were only hypothetical and that participants’ benefits

were pooled in a single trust account, the Plan Brochure did not

contain such an explanation and describes participants’ interests in

the Plan as individual “accounts” which they “own.”

Burstein, ___ F. Supp. 2d ___, 2002 WL 31319407, at *17-*18 (emphasis

added) (citations omitted).

35

In addition, the district court determined that “the

allegations in Count I and throughout the rest of the

proposed Second Amended Complaint, if true, can

reasonably support an inference that Kasperbauer was

aware of Plan participants’ misunderstanding as to the

scope of their rights to retirement benefits upon

termination.” Burstein, ___ F. Supp. 2d ___, 2002 WL

31319407, at *18. For this reason, the district court stated

that the “Second Amended Complaint adequately alleges

that Kasperbauer knew of the confusion created.” Id.

Kasperbauer does not challenge this conclusion on appeal.31

The district court concluded, however, that the fourth

element of an ERISA breach of fiduciary duty claim —

which it termed “causation” or “resulting harm,” based on

its use of Unisys II as the guiding precedent — had not

been met. The district court explained that “in the context

of a breach of fiduciary duty claim premised on a

misrepresentation or omission, it is difficult to conceive of

any type of causation other than some kind of detrimental

reliance by the plan beneficiary.” Burstein, ___ F. Supp. 2d

___, 2002 WL 31319407, at *19. The district court also

cited our cases that identified detrimental reliance as an

element of a breach of fiduciary duty claim based upon a

misrepresentation. See id. (citing, inter alia, Adams v.

Freedom Forge Corp., 204 F.3d 475, 492 (3d Cir. 2000); In

re Unisys Corp. Retiree Medical Benefit “ERISA” Litigation

31. In Daniels, we did not identify “knowledge of the confusion” as an

element of a breach of fiduciary duty claim. See Daniels, 263 F.3d at 73.

Instead, we identified the third element as the “materiality” of the

misrepresentation. Id. Our formulation in Adams v. Freedom Forge Corp.,

204 F.3d 475 (3d Cir. 2000), combines these ideas by requiring that, to

state a claim for breach of fiduciary duty, the fiduciary, among other

things, must have “made a material misrepresentation that would

confuse a reasonable beneficiary about his or her benefits.” Id. at 492.

Though the Adams court did not use the word “knowledge,” the

requirement that a misrepresentation must “confuse a reasonable

beneficiary” suggests that a fiduciary, as an objective matter, knew or

should have known that a beneficiary would be confused. Because

Kasperbauer has conceded this element, at least for purposes of the

motion to dismiss, we need not parse out precisely what role “knowledge”

has in stating a claim for breach of fiduciary duty.

36

(Unisys III), 242 F.3d 497, 507-09 (3d Cir.), cert. denied,

534 U.S. 1018 (2001)).

The district court held that Burstein had failed to plead

reliance; rather, he had alleged only the mere “expectation

that benefits would materialize,” without alleging “reliance

on that expectation.” Id. (emphasis in original). The court

found “telling” that, in its view, Burstein had failed to cite

an action taken in reliance on this expectation by the time

of his Second Amended pleading. Id. at *20.

On appeal, Burstein argues that the district court’s

reading of our precedent to require pleading of detrimental

reliance constituted error. Pointing to the “resultant harm”

language from Unisys II, Burstein claims that detrimental

reliance is one of many ways to show “resultant harm.”

Unisys II, 57 F.3d at 1265. This view, however, does not

comport with our explicit identification in Daniels of

detrimental reliance as a necessary element of a breach of

fiduciary duty claim based on misrepresentation. See

Daniels, 263 F.3d at 73. As we have recited, in order to

state a claim for misrepresentation by an ERISA fiduciary,

Burstein must allege the four elements found in Daniels: (1)

that Kasperbauer was acting as a fiduciary; (2) that

Kasperbauer made misrepresentations; (3) that the

misrepresentations are material; and (4) that Burstein relied

on the misrepresentations to his detriment. Id. Even in cases

prior to Daniels, we had also explained that detrimental

reliance is an element of an ERISA breach of fiduciary

claim. See Adams, 204 F.3d at 492 (3d Cir. 2000) (“An

employee may recover for a breach of fiduciary duty if he or

she proves that an employer, acting as a fiduciary, made a

material misrepresentation that would confuse a reasonable

beneficiary about his or her benefits, and the beneficiary

acted thereupon to his or her detriment.”) (emphasis added)

(citing Unisys II); see also Unisys III, 242 F.3d 497, 505 (3d

Cir. 2001) (quoting Adams).

Our jurisprudence therefore requires “detrimental

reliance” as an element of a breach of fiduciary duty claim.

See Daniels; Adams; Unisys III. Burstein argues that “[i]n

some cases, causation may be established based upon the

employee’s expectancy interest in the misrepresented

benefits.” Burstein Reply Br. at 10-11 (emphasis added)

37

(citing Unisys III, 242 F.3d at 506 n.7). The footnote to

which Burstein points in Unisys III, 242 F.3d at 506 n.7,

however, does not refer to an “expectancy interest” as an

element of an ERISA breach of fiduciary duty, but rather to

the character of potential ERISA remedies. Indeed, the very

next footnote in Unisys III, id. at 506 n.8, reiterates

that “detrimental reliance is a necessary element of a

breach of fiduciary duty of this kind,” i.e., involving

misrepresentations.

As counsel for Burstein conceded at oral argument, the

proposed Second Amended Complaint cannot be read to

plead detrimental reliance. In answer to our questions at

oral argument, however, counsel represented to us that, if

Burstein was given yet another opportunity to plead

reliance, he could do so.

During counsel’s opening argument, counsel stated that

the element of detrimental reliance had been pled in the

proposed Second Amended Complaint. See Tr. of Oral Arg.

at 23 (“It’s in our proposed Second Amend[ed] Complaint.

That’s absolutely in our proposed Second Amended

Complaint.”). After reviewing the complaint, however, the

following colloquy between the Court and counsel occurred

during counsel’s rebuttal argument:

THE COURT: Mr. Eisenhofer. Were you able to find

the provisions [concerning detrimental reliance]?

MR. EISENHOFER: I’ll tell you, what I found was, I

found a way in which we pled the element of resulting

harm, because that is what we understood from this

Court’s opinions were the elements of the breach of

fiduciary duty claim, and one of the ways to show

resulting harm was through detrimental reliance.

THE COURT: Did you plead detrimental reliance?

MR. EISENHOFER: We did not plead specifically that

the receipt of less compensation and benefits for being

employed at AHERF when they were led to believe that

they would receive it[; we] did not say that that

constitutes detrimental reliance. We did plead the loss

of expectancy in the compensation of benefits. That’s

what I recall.

38

Tr. of Oral Arg. at 57-58.

The Court questioned counsel further on the choice not

to plead detrimental reliance:

THE COURT: Isn’t that a different animal?

MR. EISENHOFER: I don’t believe so, your Honor. I

believe that the element of breach of fiduciary duty is

the resulting harm, and one of the ways in which this

Court has said you can show resulting harm is

detrimental reliance. Another way in which you can

show resulting harm is to receive something less than

what you have been led to believe you would.

THE COURT: Well, your opponent said it was a

deliberate decision on your part, because you feared

problems with a possible class certification motion later

on.

MR. EISENHOFER: They may be giving me a little bit

more credit than I deserve, your Honor.

Tr. of Oral Arg. at 58-59.

Counsel then sought to argue that (contrary to what we

have held, supra) detrimental reliance is not a necessary

element of a breach of fiduciary duty. The Court then asked

whether, if it were to disagree, Burstein would be able to

plead detrimental reliance:

THE COURT: Let’s assume for the moment that we

don’t agree with you on that, and the question then

becomes, can you, in good faith, state that these

plaintiffs relied on the Summary Plan Description by

some action that they took, and that as a result of that

reliance, they were thereafter harmed?

MR. EISENHOFER: I believe so, your Honor. I mean,

I think that the element that has been —

THE COURT: There has to be more than just beliefs,

though, because what you’re asking us to do is to

reverse [the District Court,] send it back for a Third

Amended Complaint so that you can state precisely

what Judge Ambro has informed you must be stated.

And there’s no point in our sending it back and holding

39

that he abused his discretion . . . if indeed, you don’t

know that you can do that. . . .

MR. EISENHOFER: Your Honor, as I said, I believe

that we can do that as to these plaintiffs. I think that

the element that has been missing . . . from the

argument, because I don’t know that is dispositive . . .

is that the misstatements in the Summary Plan

Description were not the only misstatements. . . .

[T]here was a whole other brochure which created a

whole host of different misunderstandings on the part

of these persons which are all part of the mix.

THE COURT: . . . The question in my mind is, how

do . . . we then turn around and say . . . to the District

Court judge who has assembled in his mind [the

defendants’] arguments and yours and who said

plaintiffs still didn’t do this [i.e., plead detrimental

reliance]? How do we tell him that he abused his

discretion?

MR. EISENHOFER: Your Honor, what I would

suggest is that we thought that we pled the element of

harm. . . .

Our position had been that detrimental reliance is

not the sole way in which you can show causation, but

having an expectancy in these benefits is implicitly

relying upon their existence.

To the extent that this Court disagrees with our

argument on the expectancy and the implicit nature of

the reliance in having that expectancy, I would ask for

leave to replead to meet that standard, but . . . I’m

hopeful that the Court not eliminate the expectancy at

the motion to dismiss stage as a possible way of

showing harm . . .

Tr. of Oral Arg. at 62-66.

It is our understanding, therefore, that Mr. Eisenhofer,

counsel for Burstein, has represented to this Court that

Burstein can and will plead the element of detrimental

reliance in alleging the breach of fiduciary duty by

Kasperbauer. We emphasize that it is on the basis of Mr.

Eisenhofer’s representation that we will direct the district

40

court to permit Burstein to file a Third — and final —

Amended Complaint so that Burstein, if he can, may plead

detrimental reliance on the Summary Plan Description.32

To simplify the morass which may have been created by

our permitting the Second Amended Complaint to be filed,

even though we have affirmed the district court’s dismissal

of many of its counts and defendants, our direction that the

district court permit a Third and final Amended Complaint

to be filed should be read as requiring the following:

1. Burstein, in conformance with this opinion, is to

eliminate and delete all but the actionable claims against

those defendants who we have held may be liable. This

means that where the district court has dismissed

particular defendants, and we have affirmed those

dismissals, Burstein may not allege the same claims

against them.

2. Thus, where we have affirmed the district court’s

dismissal of Count VI, Burstein may not reallege those

claims.

3. Where Burstein’s counsel has represented to us that

detrimental reliance can be pled in his cause of action

asserted against Kasperbauer for breach of fiduciary duty,

he may do so if indeed there has been detrimental reliance.

If he cannot plead such reliance, then his complaint must

delete the claim for breach of fiduciary duty.

Thus, the remaining viable portions of the Second

Amended Complaint (which had not been filed) may now be

transferred to Burstein’s Third and final Amended

Complaint, and the district court, after such filing, may

again exercise its discretion in reviewing the Third

Amended Complaint.

32. We do so particularly since we are reversing and remanding to the

district court in any event. Thus, in so instructing the district court, we

emphasize that we do not fault the district court for denying Burstein’s

motion for leave to file the proposed Second Amended Complaint. Under

the district court’s reading of Gridley, the district court could well have

considered filing a new complaint to be futile.

41

VI.

We summarize our holdings in this case.

Because we hold that a plan beneficiary may state a

claim for plan benefits based on a conflict between a

summary plan description and a plan document, we will

reverse the dismissal of the claim for plan benefits

pursuant to 29 U.S.C. § 1132(a)(1)(B) (Counts VII and VIII)

only as against the Plan itself, and the PBGC as

administrator of the Plan, and will affirm the dismissal of

all other defendants.

Because 29 U.S.C. § 1322(a) specifically limits the

responsibility of the PBGC to guarantee plan benefits and

excludes from that guarantee those benefits that — as in

this case — have become nonforfeitable “solely” as a result

of the Plan’s partial termination, we will affirm the

dismissal of the claim for plan benefits against the PBGC in

its role as guarantor. (Counts IX-X).

We will affirm the dismissal of the equitable estoppel

claim (Count VI) against all defendants because the relief

Burstein seeks with respect to the equitable estoppel claim

is no longer viable (as injunctive relief is unavailable) and

because extraordinary circumstances were not pled.

We will affirm the dismissal of all defendants but

Kasperbauer on the breach of fiduciary duty claims (Count

I, except as to Kasperbauer, and Counts II through V,

inclusive). We will reverse the district court’s dismissal of

the claim for breach of fiduciary duty against Kasperbauer

(Count I as to Kasperbauer), as Kasperbauer was the only

plan fiduciary with responsibilities related to the Summary

Plan Description.

Based upon the representation that counsel for Burstein

made to this Court, we will direct the district court, on

remand, to permit Burstein to file a final, Third Amended

Complaint as described above.

Given our disposition of these claims, we will also reverse

the denial of the motion for class certification as moot. We

express no opinion as to whether a class should be

42

certified, and instead leave that determination to the

district court’s discretion in the first instance.33

Thus, we will AFFIRM IN PART and will REVERSE IN

PART the judgment of the district court, and will REMAND

for further proceedings consistent with this opinion.

A True Copy:

Teste:

Clerk of the United States Court of Appeals

for the Third Circuit

33. The district court is free, in its full discretion, to hold hearings if

deemed necessary or to take other actions deemed appropriate based on

the remaining issues before it.