Daniel Warmenhoven v. Netapp, Inc.

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

DANIEL WARMENHOVEN, No. 19-16960

Plaintiff-Appellant,

D.C. No.

v. 5:17-cv-02990-

BLF

NETAPP, INC.; NETAPP EXECUTIVE

MEDICAL RETIREMENT PLAN,

Defendants-Appellees. OPINION

Appeal from the United States District Court

for the Northern District of California

Beth Labson Freeman, District Judge, Presiding

Argued and Submitted February 10, 2021

San Francisco, California

Filed September 13, 2021

Before: Morgan Christen and Bridget S. Bade, Circuit

Judges, and Gary Feinerman, * District Judge.

Opinion by Judge Feinerman

*

The Honorable Gary Feinerman, United States District Judge for

the Northern District of Illinois, sitting by designation.

2 WARMENHOVEN V. NETAPP

SUMMARY **

ERISA

The panel affirmed in part and vacated in part the district

court’s summary judgment in favor of defendants on retired

executives’ claims that termination of the NetApp Executive

Medical Retirement Plan violated ERISA because they had

been promised lifetime benefits.

Only one plaintiff appealed. The panel affirmed the

district court’s judgment as to plaintiff’s direct claim for

benefits under 29 U.S.C. § 1132(a)(1)(B). The panel held

that the default rule under ERISA is that employers may

freely terminate welfare benefit plans. The panel concluded

that PowerPoint presentations summarizing the Plan for

participating executives did not override the default rule,

where certificates of insurance coverage included provisions

granting NetApp the authority to terminate benefits under

the Plan at any time. The panel held that the PowerPoint

presentations were not Plan documents because they did not

qualify as written instruments under 29 U.S.C. § 1102(b),

and they therefore could not vest lifetime benefits.

The panel vacated the judgment as to plaintiff’s

alternative claim for equitable relief under 29 U.S.C.

§ 1132(a)(3) and remanded for further proceedings on that

claim. Plaintiff alleged that, if the Plan did not grant him

vested lifetime benefits, then NetApp misrepresented the

nature of the Plan in the PowerPoints, in violation of the

fiduciary duties it owed as a Plan administrator. The panel

**

This summary constitutes no part of the opinion of the court. It

has been prepared by court staff for the convenience of the reader.

WARMENHOVEN V. NETAPP 3

held that the district court erred in in granting summary

judgment on the ground that NetApp did not commit a

remediable wrong under 29 U.S.C. § 1104(a)(1) by failing

to discharge its duties with respect to the Plan solely in the

interest of the participants and beneficiaries. Disagreeing

with the Seventh Circuit, the panel held that there is no

intentional deceit requirement under § 1104(a)(1). The

panel further held that the district court erred in concluding

that the fiduciary duty claim failed because plaintiff could

have examined the certificates of insurance to dispel any

misunderstanding arising from the PowerPoints. The panel

concluded that plaintiff did not forfeit any argument on the

remedy prong of his claim for equitable relief, an issue not

reached by the district court.

COUNSEL

J. Phillip Martin (argued) and Eric C. Kastner, Kastner Kim

LLP, Mountain View, California; Robert L. Rusky, San

Francisco, California; for Plaintiff-Appellant.

Laurie J. Hepler (argued), Greines Martin Stein & Richland

LLP, San Francisco, California; Clarissa A. Kang and Angel

L. Garrett, Trucker Huss, San Francisco, California; for

Defendants-Appellees.

4 WARMENHOVEN V. NETAPP

OPINION

FEINERMAN, District Judge:

In 2005, NetApp, Inc. created the NetApp Executive

Medical Retirement Plan, an employee welfare benefit plan

governed by the Employee Retirement Income Security Act

of 1974 (“ERISA”), 29 U.S.C. §§ 1001–1461, to provide

health insurance benefits to its retired senior executives. In

2016, NetApp implemented a phased termination of the

Plan. Daniel Warmenhoven and six other retired executives

sued NetApp and the Plan (together, “NetApp”), alleging

that terminating the Plan violated ERISA because they had

been promised lifetime benefits. The suit asserted two

distinct ERISA claims: (1) a direct claim for benefits under

§ 1132(a)(1)(B); and (2) an alternate claim for equitable

relief under § 1132(a)(3) to redress NetApp’s alleged

misrepresentations that the Plan would provide lifetime

benefits. The district court granted summary judgment to

NetApp on both claims.

Only Warmenhoven appeals. We have jurisdiction

pursuant to 28 U.S.C. § 1291. We affirm the district court’s

judgment as to Warmenhoven’s § 1132(a)(1)(B) claim,

vacate the judgment as to his § 1132(a)(3) claim, and remand

for further proceedings on the § 1132(a)(3) claim.

Background

I. The Plan’s Creation and Termination

Warmenhoven was NetApp’s Chief Executive Officer

from 1994 to 2009 and, after stepping down as CEO, served

as Executive Chairman of NetApp’s Board of Directors until

2014, formally retiring in April 2015. In 2003, at the request

of another senior NetApp executive, Warmenhoven asked

WARMENHOVEN V. NETAPP 5

the company’s Human Resources department to explore the

creation of an executive retiree health plan. After extensive

consideration, the Board’s Compensation Committee

adopted the Plan effective May 2005.

Some ten years later, in November 2015, the

Compensation Committee decided to close the Plan to any

new participants and to explore alternatives to the Plan for

existing participants. At that time, nine executives and

eighteen dependents were receiving health insurance

benefits under the Plan. The parties’ dispute over what

motivated the Compensation Committee’s decision—

NetApp asserts that the Plan’s increasing costs made the

benefit unsustainable at a time when it was laying off

thousands of employees, while Warmenhoven charges that

NetApp’s rationale was pretextual—is immaterial to this

appeal.

In April 2016, the Compensation Committee decided to

terminate the Plan. Under a new “Amended and Restated

Plan,” NetApp would reimburse participating retirees like

Warmenhoven for the cost of purchasing health insurance

themselves from 2017 through 2019, and then pay them a

lump sum at the Plan’s termination on December 31, 2019.

NetApp management met with the retirees to inform them of

the Amended Plan, and the retirees expressed their

disapproval. Despite the opposition from retirees, NetApp

went forward with the Amended Plan, giving formal notice

to Warmenhoven by letter dated November 16, 2016. The

Amended Plan took effect on January 1, 2017.

II. Documentation of the Plan’s Terms

As discussed below, the default rule under ERISA is that

employers may freely terminate welfare benefit plans like

the Plan. See 29 U.S.C. § 1051(1) (exempting welfare

6 WARMENHOVEN V. NETAPP

benefit plans from ERISA’s vesting provisions).

Warmenhoven filed this suit on the view that NetApp had

promised him that the health insurance benefits offered

under the Plan would last for his lifetime, overriding the

default rule that welfare benefits do not vest.

To support his view, Warmenhoven relies primarily on a

series of PowerPoint presentations that summarized the Plan

for participating executives. Although at least seven

versions of the PowerPoint were created over the years,

Warmenhoven personally saw only two.

The first was an April 2005 PowerPoint created by

NetApp Human Resources to describe the Plan to NetApp

management, including Warmenhoven in his role as CEO.

The PowerPoint stated that the Plan would provide medical

coverage to “a defined group of retiring executives as a fully-

insured plan.” It also stated that any company acquiring

NetApp would be required to provide an equivalent plan “for

the lives of the eligible employees.” NetApp does not

dispute that, as the PowerPoint suggested, it intended as of

April 2005 to maintain the health insurance benefit for the

participants’ lifetimes.

The second version of the PowerPoint that

Warmenhoven saw was a March 2014 version prepared

shortly before his retirement. That version stated that the

“Executive Medical Retirement Plan [was] adopted by

[NetApp] as a method to retain a defined group of senior

executives.” In more explicit terms than the April 2005

version, the March 2014 version promised that the “Plan

provides medical benefits for the retiree’s lifetime” and that

“[n]o retiree contributions [are] required.”

As further support for his view that he had been promised

lifetime benefits, Warmenhoven points to NetApp’s public

WARMENHOVEN V. NETAPP 7

disclosures in filings with the Securities and Exchange

Commission (“SEC”). Like the PowerPoints, NetApp’s

SEC disclosures stated that the Plan would provide lifetime

healthcare benefits to participants. For instance, a 2016

disclosure stated that “[c]overage continues through the

duration of the lifetime of the retiree or the retiree’s spouse,

whichever is longer.” The record does not contain evidence

that Warmenhoven personally reviewed the SEC filings, but

the filings do show that, as late as April 2016, NetApp was

telling the public that it intended to cover its retired

executives’ healthcare for their lifetimes.

NetApp focuses attention on a third category of

documents: the certificates of coverage prepared by the

health insurance companies with which NetApp contracted

to administer the Plan. NetApp hired Cigna to administer

the Plan at its inception in 2005. Cigna composed a separate

certificate for each year it administered the Plan, from 2005

to 2012. In 2013, NetApp replaced Cigna with

UnitedHealthcare (“UHC”), and UHC composed certificates

for the Plan from 2013 to 2016. As with the April 2005 and

March 2014 PowerPoints, Warmenhoven personally

received a copy of the 2015 UHC certificate.

The certificates of coverage primarily concerned the

details, which are not pertinent here, of health coverage for

the calendar year in question. The important provisions for

present purposes addressed Plan administration: how

coverage was paid for, who managed the Plan, and who had

the authority to alter the Plan’s terms. See 29 U.S.C.

§ 1102(b) (requiring that an ERISA plan’s written

instrument disclose this information). For example, the 2005

Cigna and 2015 UHC certificates each included a section

devoted to those disclosures, titled “ERISA Required

8 WARMENHOVEN V. NETAPP

Information” in the Cigna certificate and “ERISA

Statement” in the UHC certificate.

Notably, each certificate of coverage included at least

one provision granting NetApp the authority to terminate

benefits under the Plan at any time—directly contradicting

the PowerPoints’ promises of lifetime benefits. For

example, the ERISA disclosure in the 2005 Cigna certificate

stated:

The Employer as Plan Sponsor reserves the

right to, at any time, change or terminate

benefits under the Plan, to change or

terminate the eligibility of classes of

employees to be covered by the Plan, to

amend or eliminate any other plan term or

condition, and to terminate the whole plan or

any part of it.

The 2015 UHC certificate likewise stated: “Your employer,

as the Plan Sponsor, has the right to amend or terminate this

Plan at any time.”

III. Procedural History

Warmenhoven and six other retired executives filed this

lawsuit in May 2017, bringing two claims under ERISA.

The first claim alleged that the PowerPoints operated to vest

lifetime benefits and sought recovery of those benefits

directly under § 1132(a)(1)(B). The second claim, brought

in the alternative to the first, arose under § 1132(a)(3), which

allows suits for equitable relief to redress ERISA violations.

The plaintiffs alleged that, if the Plan did not grant them

vested lifetime benefits, then NetApp had misrepresented the

nature of the Plan, in violation of the fiduciary duties it owed

them as a plan administrator under § 1104(a)(1). Under the

WARMENHOVEN V. NETAPP 9

second claim, the plaintiffs sought several forms of equitable

relief: an injunction ordering continued benefits, reformation

of the plan documents, estoppel, and surcharge.

After conducting discovery, the parties cross-moved for

summary judgment. The district court granted NetApp’s

motion, denied the plaintiffs’ motion, and entered judgment

for NetApp. Gomo v. NetApp, Inc., No. 17-cv-022990-BLF,

2019 WL 4346581, at *13 (N.D. Cal. Sept. 12, 2019). As to

the § 1132(a)(1)(B) claim, the district court held that the

PowerPoints were not “plan documents,” and therefore that

their language could not vest lifetime benefits. Id. at *5–6.

Instead, the court held, the certificates of coverage were the

controlling plan documents, and they allowed free

amendment of the Plan. Id. at *7–9. As to the § 1132(a)(3)

claim, the court held that NetApp had committed no breach

of fiduciary duty because it had no intent to deceive and

because the plaintiffs could have examined the certificates

of coverage to dispel any misunderstanding arising from the

PowerPoints. Id. at *11–13.

Six of the seven plaintiffs timely appealed. After a

mediation conference, we granted the motions of five

plaintiffs to dismiss their appeals. Warmenhoven, the sole

remaining appellant, seeks reversal only of the grant of

summary judgment to NetApp, not the denial of his

summary judgment motion.

Discussion

I. Claim for Benefits Under § 1132(a)(1)(B)

Section 1132(a)(1)(B) “provides a right of action for plan

participants or beneficiaries ‘to recover benefits due . . .

under the terms of [a] plan, to enforce [ ] rights under the

terms of the plan, or to clarify [ ] rights to future benefits

10 WARMENHOVEN V. NETAPP

under the terms of the plan.’” Doe v. CVS Pharmacy, Inc.,

982 F.3d 1204, 1213 (9th Cir. 2020) (alterations in original)

(quoting 29 U.S.C. § 1132(a)(1)(B)), cert. granted, — S. Ct.

—, 2021 WL 2742790 (July 2, 2021). The plaintiff bears the

burden of proof on a § 1132(a)(1)(B) claim. See Muniz v.

Amec Constr. Mgmt., Inc., 623 F.3d 1290, 1294 (9th Cir.

2010).

To avoid summary judgment on his § 1132(a)(1)(B)

claim, Warmenhoven had to present evidence of a specific

plan document that vested lifetime benefits. The Plan was a

“welfare plan,” which ERISA defines to include “any plan,

fund, or program . . . maintained for the purpose of providing

. . . medical, surgical, or hospital care or benefits.”

29 U.S.C. § 1002(1). As noted, the default rule under

ERISA provides that welfare plans do not vest and can be

amended at any time: “Employers or other plan sponsors are

generally free under ERISA, for any reason at any time, to

adopt, modify, or terminate welfare plans.” Curtiss-Wright

Corp. v. Schoonejongen, 514 U.S. 73, 78 (1995); see

29 U.S.C. § 1051(1) (providing that ERISA’s vesting

provisions “apply to any employee benefit plan . . . other

than . . . an employee welfare benefit plan”). A plan may

override this default rule, but only if it does so expressly in

a plan document: “A contractual agreement for vesting of

benefits must be found in the plan documents.” Cinelli v.

Sec. Pac. Corp., 61 F.3d 1437, 1441 (9th Cir. 1995); accord,

e.g., Gable v. Sweetheart Cup Co., 35 F.3d 851, 855 (4th Cir.

1994) (“[A]ny participant’s right to a fixed level of lifetime

benefits must be ‘found in the plan documents and must be

stated in clear and express language.’”) (quoting Wise v. El

Paso Nat. Gas Co., 986 F.2d 929, 937 (5th Cir. 1993)).

“Plan document” is a term of art under ERISA. It does

not mean any writing related to a plan; rather, it means the

WARMENHOVEN V. NETAPP 11

formal “written instrument” that ERISA requires for each

employee benefit plan. 29 U.S.C. § 1102(a)(1) (“Every

employee benefit plan shall be established and maintained

pursuant to a written instrument.”); see Rhea v. Alan Ritchey,

Inc. Welfare Benefit Plan, 858 F.3d 340, 344 (5th Cir. 2017)

(“Courts often refer to written instruments as ‘plan

documents.’”). To qualify as a written instrument, a

document must satisfy the four requirements of § 1102(b);

specifically, the document must “(1) provide a policy and a

method for funding the plan, (2) describe a procedure for

plan operation and administration, (3) provide a procedure

for amending the plan, and (4) specify a basis for payments

to and from the plan.” Cinelli, 61 F.3d at 1441 (quoting

Watkins v. Westinghouse Hanford Co., 12 F.3d 1517, 1523

n.1 (9th Cir. 1993)) (citing 29 U.S.C. § 1102(b)). In a more

generic sense, the term “plan document” at times is used to

refer to the summary plan description (“SPD”), a less formal

document intended to give participants essential information

about their plan. See 29 U.S.C. §§ 1022, 1024(b) (requiring

the plan administrator to furnish plan participants and

beneficiaries with an SPD containing certain categories of

information); Prichard v. Metro. Life Ins. Co., 783 F.3d

1166, 1169 (9th Cir. 2015) (“[P]articularly in the context of

health plans, the SPD is sometimes argued to be the plan;

that is, to serve simultaneously as the governing plan

document.”). No party contends that any of the documents

at issue here functioned as an SPD for the Plan, so there is

no need to consider how the presence of an SPD among

those documents would affect the outcome of this appeal.

To avoid confusion, we will use the term “written

instrument”—the term used in ERISA—to refer to the

formal plan document required by § 1102(a)(1). See

Prichard, 783 F.3d at 1169 (distinguishing the SPD from the

“formal plan document” required under § 1102(a)(1)).

12 WARMENHOVEN V. NETAPP

Warmenhoven submits that the PowerPoint

presentations were plan documents that could and did vest

lifetime healthcare benefits. He does not argue, however,

that the PowerPoints met the criteria for a written instrument

under § 1102(b). Instead, he argues that NetApp’s promises

in the PowerPoints created an ERISA plan with lifetime

benefits. To support that proposition, Warmenhoven relies

on decisions such as Donovan v. Dillingham, 688 F.2d 1367

(11th Cir. 1982), Scott v. Gulf Oil Corp., 754 F.2d 1499 (9th

Cir. 1985), and Golden Gate Restaurant Ass’n v. City and

County of San Francisco, 546 F.3d 639 (9th Cir. 2008).

Warmenhoven’s argument is unpersuasive. As we

explained in Cinelli, the line of cases he invokes governs

“instances where a formal plan is absent and the question

remains whether a de facto plan has been created.” 61 F.3d

at 1443. In Scott, for instance, the plaintiffs alleged that their

employer made oral and written promises of severance pay.

754 F.2d at 1501. We concluded that such informal

commitments to provide benefits could create an ERISA-

governed plan in circumstances where there is no written

instrument, lest “employers . . . escape ERISA’s coverage

merely by failing to comply with its requirements.” Id. at

1503; see also Donovan, 688 F.2d at 1373 (holding that a

plan exists, whether “pursuant to a writing or not,” where “a

reasonable person could ascertain the intended benefits,

beneficiaries, source of financing, and procedures for

receiving benefits”). However, in situations where the plan

sponsor has prepared a written instrument, that line of

decisions has no application. See Golden Gate Rest. Ass’n,

546 F.3d at 652 (“All of the cases applying the Donovan

criteria address the question whether an informal, or de

facto, ERISA plan has been established, and all involve

some type of unwritten or informal promise made by an

employer to its employees.”).

WARMENHOVEN V. NETAPP 13

Given the limited reach of the decisions he invokes,

Warmenhoven must be understood as arguing that there was

no ERISA-compliant written instrument for the Plan, and

therefore that NetApp should be held to the less formal

promises it made in the PowerPoints to provide lifetime

health insurance benefits. Cinelli forecloses that theory by

holding that only a written instrument satisfying the

requirements of § 1102(b)—and not some other document—

can vest lifetime benefits.

In Cinelli, an insurance policy certificate stated that the

policy was terminable at any time, but a company board

resolution stated that the benefit was fully vested. 61 F.3d

at 1440–41. We noted that it was “clear that an insurance

policy may constitute the ‘written instrument’ of an ERISA

plan,” and asked whether the board resolution was “also a

plan document.” Id. at 1441. We held that the board

resolution was “not a plan document” because it did not meet

the criteria for a written instrument set forth in § 1102(b).

Id. at 1441–42, 1444. And because the resolution was not a

written instrument, it was “extrinsic evidence” that could

“not be used to alter the written terms of the plan,” which

provided that the life insurance benefit was terminable at any

time. Id. at 1444.

The upshot of Cinelli is that only a written instrument

satisfying the § 1102(b) criteria can vest lifetime benefits.

And we have since reaffirmed Cinelli’s teaching that the

§ 1102(b) criteria, and only those criteria, govern which

writings qualify as written instruments. See Mull ex rel. Mull

v. Motion Picture Indus. Health Plan, 865 F.3d 1207, 1209

(9th Cir. 2017) (examining the § 1102(b) criteria to

determine which documents were the written instrument);

accord, e.g., Rhea, 858 F.3d at 344 (holding that an SPD can

qualify as a written instrument if it meets the § 1102(b)

14 WARMENHOVEN V. NETAPP

criteria); Gable, 35 F.3d at 857 (applying § 1102(b) in

holding that a schedule promising lifetime benefits was not

a written instrument).

Ignoring these precedents, Warmenhoven does not argue

that the PowerPoints met the four requirements for “plan

documents” under § 1102(b). Indeed, he argues that the

district court “fundamentally misconstrued ERISA’s

governing principles” in “relying on . . . § 1102(b)” to

determine whether the PowerPoints were plan documents.

As we have explained, the district court correctly looked to

§ 1102(b) to determine whether the PowerPoints were

written instruments and thus whether they could vest lifetime

benefits. By deliberately choosing to stand on his flawed

argument that the PowerPoints created a vested ERISA plan

without there being any written instrument, and by declining

to argue in the alternative that he could prevail even if

§ 1102(b) applied, Warmenhoven has affirmatively waived

any argument under the proper legal standard that the

PowerPoints were written instruments. See Freedom From

Religion Found., Inc. v. Chino Valley Unified Sch. Dist. Bd.

of Educ., 896 F.3d 1132, 1152 (9th Cir. 2018) (per curiam)

(“It is well established that an appellant’s failure to argue an

issue in the opening brief, much less on appeal more

generally, waives that issue . . . .”); Alvarez v. Lopez,

835 F.3d 1024, 1028 (9th Cir. 2016) (finding an “intentional

waiver” where the appellant “deliberately steered” the court

away from an issue, thereby “preclud[ing] us from raising

[the issue] sua sponte”). That waiver conclusively defeats

his § 1132(a)(1)(B) claim because, under Cinelli, he bears

WARMENHOVEN V. NETAPP 15

the burden to prove that a specific written instrument vested

lifetime benefits. 1

II. Claim for Breach of Fiduciary Duty Under

§ 1132(a)(3)

Warmenhoven’s second claim alleges in the alternative

that, if the PowerPoint presentations did not vest lifetime

benefits, he is entitled under § 1132(a)(3) to equitable relief

to remedy NetApp’s misrepresentations that the Plan’s

health benefits were permanent. Section 1132(a)(3)

provides:

A civil action may be brought . . . (3) by a

participant . . . (B) to obtain other appropriate

1

Warmenhoven does not raise, and therefore has forfeited, any

argument that the PowerPoint presentations and the certificates of

coverage combined to form a written instrument under § 1102. See

Maloney v. T3Media, Inc., 853 F.3d 1004, 1019 (9th Cir. 2017) (holding

that arguments that are not presented in appellate briefs are forfeited).

We addressed a somewhat analogous argument in Mull. There,

participants in a health care plan sought a declaration that the plan could

not enforce against them recoupment provisions found only in the SPD

but not in the plan’s trust agreement. 865 F.3d at 1209. We held that

because the trust agreement met only three of the four § 1102(b) criteria,

it could not qualify on its own as the plan’s written instrument. Id. But

because the SPD met the remaining criterion, we held that “the two

documents together constitute[d] a plan,” id. at 1209–10, and therefore

that the SPD’s recoupment provisions were enforceable, id. at 1210–11.

Here, even if Warmenhoven had made an argument based on Mull, it

would have failed on the merits because the district court correctly held

that the certificates of coverage—which, as noted, expressly stated that

the Plan could be terminated at any time—by themselves qualified as the

Plan’s written instrument under § 1102. See Prichard, 783 F.3d at 1171

(holding that an insurance certificate was a plan’s written instrument).

Accordingly, there was no gap for the PowerPoint presentations to fill,

meaning that the PowerPoints did not form part of a written instrument

that could vest lifetime benefits.

16 WARMENHOVEN V. NETAPP

equitable relief (i) to redress [any act or

practice which violates any provision of Title

I of ERISA or the terms of the plan] or (ii) to

enforce any provisions of [Title I] or the

terms of the plan.

29 U.S.C. § 1132(a)(3). A § 1132(a)(3) claim has two

elements: “(1) that there is a remediable wrong, i.e., that the

plaintiff seeks relief to redress a violation of ERISA or the

terms of a plan; and (2) that the relief sought is appropriate

equitable relief.” Gabriel v. Alaska Elec. Pension Fund,

773 F.3d 945, 954 (9th Cir. 2014) (internal quotation marks

and citations omitted). The district court limited its analysis

to the first prong, granting NetApp summary judgment on

the ground that no reasonable factfinder could find that

NetApp committed a remediable wrong. 2019 WL 4346581,

at *11–13. We disagree with the district court’s conclusion

on that issue and therefore vacate its grant of summary

judgment to NetApp.

A. Remediable Wrong

Warmenhoven’s theory of remediable wrong is that

NetApp, a plan fiduciary, misrepresented the Plan’s terms by

promising in the PowerPoints that the Plan provided lifetime

benefits even though the written instrument included no such

guarantee. Warmenhoven argues that NetApp thus violated

§ 1104(a)(1), which provides that “a fiduciary shall

discharge his duties with respect to a plan solely in the

interest of the participants and beneficiaries . . . .” 29 U.S.C.

§ 1104(a)(1).

As we have held, “fiduciaries breach their duties if they

mislead plan participants or misrepresent the terms or

administration of a plan.” Barker v. Am. Mobil Power Corp.,

64 F.3d 1397, 1403 (9th Cir. 1995) (per curiam). For

WARMENHOVEN V. NETAPP 17

example, in Varity Corp. v. Howe, 516 U.S. 489 (1996), a

corporation spun off failing divisions into a new company

and, despite knowing that the new company would likely

fail, induced employees to transfer their benefits to the new

company through false promises that the benefits would

remain secure. Id. at 493–94. The Supreme Court held that

the corporation’s conduct violated its fiduciary duties as a

plan fiduciary, reasoning that “[t]o participate knowingly

and significantly in deceiving a plan’s beneficiaries in order

to save the employer money at the beneficiaries’ expense is

not to act ‘solely in the interest of the participants and

beneficiaries.’” Id. at 506 (quoting 29 U.S.C. § 1104(a)(1)).

In Varity, unlike here, the plan fiduciary intended to

mislead plan participants to the fiduciary’s benefit and the

participants’ detriment. That distinction grounded the

district court’s holding here that NetApp had committed no

remediable wrong: “An employer’s honest statements of

present intention to provide benefits at a particular level do

not give rise to liability for breach of fiduciary duties, simply

because the employer later changes the benefits.” Gomo,

2019 WL 4346581, at *12.

To support its holding, the district court relied heavily on

Frahm v. Equitable Life Assurance Society of the United

States, 137 F.3d 955, 960 (7th Cir. 1998), which held that

Varity recognizes a § 1104(a)(1) fiduciary duty claim only

in cases involving intentional deceit. The defendant in

Frahm changed its retiree health plan to require retirees to

bear more costs, and the retirees argued that the company

had previously promised in oral statements and letters not to

do so. Id. at 956–57. The Seventh Circuit held that such

informal promises could not give rise to liability under

§ 1104(a)(1) unless the fiduciary “set out to deceive or

disadvantage plan participants.” Id. at 960. In so holding,

18 WARMENHOVEN V. NETAPP

the Seventh Circuit relied on an analogy to tort law, noting

that an estoppel defense or fraud claim requires “lies” where

the speaker “actually had a different intention” than

expressed. Id. at 961.

Our circuit’s law holds otherwise. As a general matter,

we have rejected the use of tort law to ground the § 1104(a)

fiduciary duty, reasoning that the duty finds its roots in trust

law, not tort law. See King v. Blue Cross & Blue Shield of

Ill., 871 F.3d 730, 744 (9th Cir. 2017) (“The duty of loyalty

is one of the common law trust principles that apply to

ERISA fiduciaries, and it encompasses a duty to disclose.”

(quoting Washington v. Bert Bell/Pete Rozelle NFL Ret.

Plan, 504 F.3d 818, 823 (9th Cir. 2007))); Mathews v.

Chevron Corp., 362 F.3d 1172, 1183 (9th Cir. 2004) (“We

fail to see the logic in transplanting the element of scienter

from the tort of deceit into a statutory ERISA claim with

roots in the law of fiduciaries and trusts.”). Our approach

aligns with the Supreme Court’s understanding of ERISA

fiduciary duties. See Varity, 516 U.S. at 496 (“[W]e

recognize that [ERISA’s] fiduciary duties draw much of

their content from the common law of trusts, the law that

governed most benefit plans before ERISA’s enactment.”).

More to the point, we expressly rejected in Mathews the

analogy to fraud that the Seventh Circuit found compelling

in Frahm. The employer in Mathews argued that “the

plaintiffs must show scienter as they would if they were

suing under the common law cause of action for deceit,” that

is, “knowledge or belief on the part of the defendant that the

representation is false.” 362 F.3d at 1183 (alteration

omitted). Such evidence of knowing deceit is what the

district court demanded of Warmenhoven here: “Plaintiffs

have not submitted any evidence, and none appears in the

record, suggesting that NetApp did not intend to provide

WARMENHOVEN V. NETAPP 19

lifetime medical benefits under the Plan when it was

adopted.” Gomo, 2019 WL 4346581, at *12. Yet, as we

explained in Mathews, “[i]n articulating Ninth Circuit law in

this area, we have followed a line of cases from our sister

circuits that does not require a showing of intent.” 362 F.3d

at 1183.

In James v. Pirelli Armstrong Tire Corp., 305 F.3d 439

(6th Cir. 2002), one of the out-of-circuit cases we approved

in Mathews, company management made repeated oral

promises that, if employees took early retirement, their

health benefits would continue unchanged “during

retirement” and “during their lifetimes.” Id. at 443–44. But

in fact, the plan documents allowed amendments to the

health benefit plan, and, after the plaintiff employees retired,

the company raised the costs to them of securing health

benefits. Id. at 442, 444–45. The Sixth Circuit held that the

company thereby breached its fiduciary duty under

§ 1104(a)(1). Id. at 448, 455. In so holding, the court

rejected any scienter requirement: “A fiduciary breaches his

duty by providing plan participants with materially

misleading information, regardless of whether the

fiduciary’s statements or omissions were made negligently

or intentionally.” Id. at 449 (quotation marks omitted). And

the court held that the company breached its fiduciary duty

by “provid[ing], on its own initiative, materially misleading

and inaccurate information about the plan benefits.” Id.

at 455.

Returning to our precedents, the health care plan in King

denied coverage for a substantial medical bill on the ground

that the participant had reached her lifetime cap on benefits.

871 F.3d at 737–38. We held that the participant had a viable

fiduciary duty claim, explaining that although the plan

documents could be interpreted to impose a lifetime benefit

20 WARMENHOVEN V. NETAPP

cap, id. at 734–36, the documents’ lack of clarity on that

point violated the employer’s and the plan’s fiduciary duties

of disclosure, id. at 745. In support, we observed that

“[f]iduciaries breach their duties [under § 1104(a)] if they

mislead plan participants or misrepresent the terms or

administration of a plan,” id. at 744 (quoting Barker, 64 F.3d

at 1403), and that the employer and the plan had failed “to

‘provide sufficiently detailed information’ about whether the

lifetime benefit maximum applied,” id. at 745 (quoting Farr

v. U.S. W. Commc’ns, Inc., 151 F.3d 908, 915 (9th Cir.

1998)). Nowhere did King suggest that the defendants

harbored an intent to deceive plan participants or that such

intent was required to find a breach of fiduciary duty.

Under our circuit’s precedents, then, Warmenhoven’s

fiduciary duty claim survives summary judgment on the

remediable wrong issue, as there is a genuine dispute of

material fact as to whether NetApp incorrectly represented

to Plan participants that the Plan provided lifetime health

insurance benefits. A reasonable factfinder easily could read

the PowerPoints to convey a promise of lifetime benefits.

Yet NetApp had not memorialized that promise in any plan

document, and in fact the certificates of coverage said the

opposite. Our circuit law does not immunize NetApp from

liability for its false promises simply because it harbored no

ill will or intent to deceive. A reasonable factfinder could

conclude that NetApp failed “to convey complete and

accurate information material to [Warmenhoven’s]

circumstance,” Barker, 64 F.3d at 1403, and thus find a

violation of § 1104(a)(1) and a remediable wrong under

§ 1132(a)(3).

The district court also held that Warmenhoven’s

fiduciary duty claim failed because he could have examined

the certificates of coverage—which provided that the Plan

WARMENHOVEN V. NETAPP 21

could be terminated at any time—to dispel any

misunderstanding arising from the PowerPoints. In Pirelli,

the Sixth Circuit rejected the notion that “a reservation of

rights provision in the plan” automatically insulates the

employer from liability under § 1104(a)(1) if the employer

provides “false or inaccurate information about the future

benefits of a plan.” 305 F.3d at 455.

The district court read our decision in Pisciotta v.

Teledyne Industries, Inc., 91 F.3d 1326 (9th Cir. 1996), to

hold otherwise, citing it for the proposition that “a

reservation of rights contained in the Plan document is

effective if the document was available for review.” Gomo,

2019 WL 4346581, at *12 (citing Pisciotta, 91 F.3d at 1331).

But Pisciotta did not so hold as to a fiduciary duty claim

under § 1132(a)(3), as we addressed in that case only a direct

claim for benefits under § 1132(a)(1)(B). 91 F.3d at 1329–

31. In fact, when the plaintiffs in Pisciotta filed suit, our pre-

Varity circuit precedent did not permit § 1132(a)(3) claims

for individual relief by participants harmed by alleged

breaches of fiduciary duty. See Williams v. Caterpillar, Inc.,

944 F.2d 658, 665 (9th Cir. 1991) (holding that “a

fiduciary’s duty under ERISA runs to the plan as a whole

and not to the individual beneficiary”), abrogated in part by

Varity, 516 U.S. 489.

In sum, that NetApp lacked an intent to deceive and that

Warmenhoven could have reviewed the certificates of

coverage do not necessarily defeat his § 1132(a)(3) claim

based on NetApp’s misrepresentations in the PowerPoints.

To be clear, we do not pronounce on the ultimate question of

whether Warmenhoven will succeed, as certain aspects of

that claim may remain unresolved. On remand, NetApp may

press that issue or any other non-waived defenses it might

have, and we do not prejudge the result.

22 WARMENHOVEN V. NETAPP

B. Appropriate Equitable Relief

After holding that no reasonable factfinder could

conclude that Warmenhoven suffered a remediable wrong,

the district court declined to address whether he would be

entitled to appropriate equitable relief to redress any such

wrong. 2019 WL 4346581, at *13. Warmenhoven’s initial

brief does not address the remedy prong, either. NetApp

argues that Warmenhoven thereby forfeited any argument

that the district court’s treatment of the remediable wrong

prong prejudiced him, requiring that summary judgment on

the § 1132(a)(3) claim be affirmed.

We rejected a materially identical argument in Rodriguez

v. Hayes, 591 F.3d 1105 (9th Cir. 2010), and do so again

here. The appellees in Rodriguez argued for affirmance of

the district court’s judgment on a ground not reached by the

district court and contended that the appellant had waived

any opposition to that argument by not anticipating it in his

initial brief. Id. at 1118 & n.6. We disposed of the appellees’

“groundless” contention in a footnote:

We have previously held that the failure of a

party in its opening brief to challenge an

alternate ground for a district court’s ruling

given by the district court waives that

challenge. . . . Petitioner does not waive a

challenge to any ground for [the district

court’s ruling] in its opening brief on appeal

that was not relied on in the district court’s

order.

Id. at 1118 n.6. NetApp is thus wrong to suggest that an

appellant must address all possible alternate grounds for

affirmance—even those not ruled upon by the district

court—in an opening brief.

WARMENHOVEN V. NETAPP 23

Beyond forfeiture, the parties do not discuss the merits

of the remedy prong. In CIGNA Corp. v. Amara, 563 U.S.

421 (2011), the Supreme Court identified three traditional

equitable remedies available under § 1132(a)(3):

reformation, equitable estoppel, and surcharge. Id. at 440–

42. Especially because the parties do not address the issue

on appeal, the proper course is to allow the district court to

consider in the first instance the merits of NetApp’s

argument for summary judgment based on the remedy

prong. See ASSE Int’l, Inc. v. Kerry, 803 F.3d 1059, 1079

(9th Cir. 2015) (“[T]he issue . . . was not fully briefed, and

as it also has not been passed upon in the first instance by

the district court, we decline to reach the issue.”);

Reinkemeyer v. SAFECO Ins. Co. of Am., 166 F.3d 982, 985

(9th Cir. 1999) (“We decline to address the issue because it

was not reached by the district court and was not fully

briefed by the parties.”).

Conclusion

The district court’s judgment is AFFIRMED IN PART

as to Warmenhoven’s § 1132(a)(1)(B) claim, and

VACATED IN PART as to his § 1132(a)(3) claim. The

case is REMANDED to the district court for further

proceedings consistent with this opinion.