The opinion of the court was delivered by: Larimer, Chief Judge.
The complaint alleges that in 1968, M & F adopted a retirement
benefit plan for its employees. M & F purchased the Plan from
New England, which had drafted it. Although M & F was the Plan
administrator, New England did provide certain services to M & F
with respect to the Plan's administration, including calculation
of employee benefits.
Plan benefits were calculated based on employees'
compensation. In 1982, M & F modified its compensation structure
for certain salespersons to provide for a salary plus
commissions.*fn1 The Plan provided that commissions would be
excluded from benefit calculations, however.
In 1984, M & F, upon defendant's recommendation, executed a
restatement of the Plan in order to remain in compliance with
certain statutory changes. New England prepared the restatement,
and on June 25, 1987,*fn2 Scott Fields, M & F's Secretary and
Treasurer, signed the restatement on behalf of M & F. The
signature page stated, inter alia, that M & F "ha[d] received,
read, accept[ed] and incorporate[ed] by reference" the restated
Plan. See Affidavit of Stephen Chiumenti, Esq. (Docket Item 6)
Ex. A. It further stated, "It is understood that [New England]
shall not be responsible for the tax and legal aspects of the
Plan and Trust, full responsibility for which is assumed by [M &
F], which hereby acknowledges that it has consulted legal and
tax counsel to the extent considered necessary." Id.
Unlike the original Plan, the restatement contained a
provision stating that commissions would be included in
benefit calculations. Plaintiff alleges that, despite the
statement that M & F had read and accepted the restated Plan, in
fact neither Fields nor anyone else from M & F had read the
restated Plan when Fields signed it. M & F alleges that it was
unaware that the restated Plan provided that commissions were to
be included, and that M & F, relying on defendant's
representations that no substantive changes had been made to the
terms of the original Plan, simply assumed that commissions
remained excluded as before.
In May 1996, M & F decided to terminate the Plan, resulting in
lump-sum distributions of accrued benefits to the covered
employees. The distributions, however, allegedly came up some
$62,000 short of the amount to which the employees were
entitled. At this stage of the proceedings, it is not entirely
clear why that occurred, but it appears that plaintiff alleges
that the shortfall was related to the fact that the Plan as
restated called for the inclusion of commissions in calculating
benefits. At any rate, M & F eventually made up the shortfall
out of its own funds by paying its employees the additional
amounts owed. M & F also alleges that it incurred other expenses
due to this error because it was forced to reprocess the
termination of the Plan in order to comply with Internal Revenue
Defendant asserts two grounds in support of its motion to
dismiss. First, defendant alleges that plaintiffs claims are
preempted by ERISA, and that because M & F has not asserted an
ERISA claim, the complaint must be dismissed.
Second, defendant contends that M & F's claims are
time-barred. Citing 29 U.S.C. § 1113, defendant states that the
limitations period for a breach of fiduciary duty claim is six
years after the last act that constituted part of the breach, or
three years after the earliest date on which the plaintiff
either had actual knowledge of the breach, or on which a report
from which the plaintiff could reasonably be expected to have
obtained knowledge of the breach was filed with the Secretary of
Labor, whichever period ends first. Here, defendant states, the
last act that was part of the alleged breach could have occurred
no later than 1987, when Scott Fields signed the restated Plan
on M & F's behalf. According to defendant, then, the limitations
period ended in 1993 at the latest, well before the complaint
was filed in 1998.
Defendant also asserts that even if plaintiffs claims are not
preempted by ERISA, they are time-barred under New York law,
which provides limitations periods of six years for breach of
contract, and three years for negligence and breach of the duty
of due care. Again, according to defendant, the last date on
which those periods could have commenced was 1987.
M & F denies that its claims are preempted by ERISA. M & F
contends that it is not asserting a claim for benefits or for
equitable relief under ERISA, but simply a straightforward
common-law claim for damages based on ...