Kelly v. Altria Client Services, LLC, Nos. 25-1350, 25-2080, __ F.4th __, 2026 WL 2293854 (4th Cir. Aug. 10, 2026) (Before Circuit Judges Quattlebaum, Benjamin, and Berner)

This week’s notable decision primarily addresses whether a delay in the timing of a transaction in a plan participant’s retirement account can give rise to ERISA liability. However, the lasting impact of this case likely has nothing to do with that issue. Instead, the case will likely be remembered for its handling of a collateral question also decided by the court: what types of documents are covered by ERISA’s disclosure provision located at 29 U.S.C. § 1024(b)(4)? Read on to learn the Fourth Circuit’s answer.

The plaintiff in the case was Richard Kelly, who worked for Philip Morris USA and its successor Altria Client Services for over two decades. He maintained a 401(k) account in Altria’s Deferred Profit-Sharing Plan for Salaried Employees even after his position was eliminated in 2010.

In 2020, anticipating a post-election stock market rally, Kelly decided to liquidate his account, transfer the proceeds to a Goldman Sachs account, and reinvest quickly, while also preserving favorable tax treatment for his non-Altria shares. On November 2, the day before the election, Kelly and his Goldman Sachs advisors called Fidelity Workplace Services, the plan’s corporate recordkeeper, to set the strategy in motion.

Fidelity told Kelly the stock sales would settle in two business days, and that the subsequent in-kind distribution of his non-Altria shares could take up to ten business days, with Fidelity holding the proceeds until the entire transfer was ready to move to Goldman Sachs. When Kelly was unhappy with this response, the representative added, “the liquid portion, you’re right, it would just take a day or two and then once it’s available, you can move that out.”

However, the full transfer was not complete until November 12. Kelly contended that Fidelity had misled him about how quickly he would have access to his money, and that had he understood the true timeline, he “would have made different decisions.”

Kelly pursued that complaint as a formal benefits claim, which Altria denied, concluding that Fidelity had acted in a timely fashion and did not give Kelly substantively incorrect information.

Kelly thus sued Altria, the plan, and Fidelity, eventually asserting three claims: (1) a denial-of-benefits claim against Altria and the plan under 29 U.S.C. § 1132(a)(1)(B); (2) a breach-of-fiduciary-duty claim against Fidelity under § 1132(a)(3), based on its allegedly misleading statements about transfer timing; and (3) a claim against Altria for refusing to produce, upon request, the Administrative Services Agreement (ASA) between Altria and Fidelity governing Fidelity’s recordkeeping role under § 1024(b)(4).

The district court proceedings went poorly for Kelly. The district court granted defendants summary judgment in a March 2025 order (as we discussed in our April 2, 2025 edition), and followed that up with an attorney’s fees award against him (covered in our August 20, 2025 edition). Kelly appealed to the Fourth Circuit, which issued this published decision.

Tackling the benefits claim first, the appellate court applied the abuse of discretion standard because the plan gave Altria “discretionary power to determine all questions that arise under the Plan,” including “the amount of any benefit to which any person is entitled to under the Plan.” Under this standard, the court found Altria’s process “reasoned” and “principled”: it gave Kelly a fair hearing, considered his claims in a deliberative meeting, reviewed the call transcripts, and considered a detailed presentation of the facts.

The court acknowledged Kelly’s frustration with Fidelity’s comment that his funds might be available earlier, but noted that Fidelity explicitly told Kelly “that the cash rollover to the Fidelity IRA would take approximately three to five business days, and that the in-kind distribution could take seven to ten business days.” Furthermore, Altria reasonably concluded that Fidelity completed its tasks “within the time frame quoted for the rollover of the cash and well before the time frame quoted for the rollover of the in-kind stock.”

Thus, the court moved on to Kelly’s breach of fiduciary duty claim. The Fourth Circuit agreed with the district court that Fidelity’s ministerial recordkeeping functions – answering participant calls, providing balances, processing distribution requests – did not make it a “functional fiduciary” under 29 U.S.C. § 1002(21)(A).

Kelly argued that “the way Fidelity performed those duties made it a functional fiduciary,” but the Fourth Circuit disagreed. The court noted that Kelly had already decided, before ever calling Fidelity, to exit the plan entirely and move his money to Goldman Sachs, and thus Fidelity did not offer him advice or guide his participation in the plan in any way.

Furthermore, the court concluded that even if Fidelity was a fiduciary, there was no breach. Fidelity’s estimates proved accurate and it completed the requested transactions within the estimated timeframes. The isolated comment Kelly seized on about “the liquid portion” was “sandwiched between several statements that the transaction would take seven to ten days,” an estimate that was repeated to Kelly in future conversations. “Less than perfect customer service? Perhaps. Breach of fiduciary duty? No.”

Kelly had better luck with his statutory penalty claim under § 1024(b)(4). Altria had argued, and the district court agreed, that the ASA merely “memorialize[d] Fidelity’s obligations to provide certain services to Altria” rather than “establishing or operating” the plan itself, and thus Altria was not required to produce the ASA.

The Fourth Circuit examined the text of the statute, focusing on the words “established or operated.” While the ASA obviously did not “establish” the plan, the court held it plainly helped the plan “operate,” because “operate” means to function, work, or produce an effect. The ASA directed Fidelity to field participant calls, process transactions, and report fund data. Because these duties “help the plan work or perform part of its process…the ASA was a document under which the plan operated.”

In so ruling, the Fourth Circuit distinguished its 1996 decision in Faircloth v. Lundy Packing Co., which had excluded appraisal reports and meeting minutes from § 1024(b)(4)’s ambit but included funding and investment policies. The court found that the ASA more closely resembled the latter, which was consistent with the Tenth Circuit’s 2024 decision in M.S. v. Premera Blue Cross (the case of the week in our October 9, 2024 edition) and the Seventh Circuit’s 2009 decision in Mondry v. American Family Mutual Insurance Co.

Finally, the court affirmed the award of attorney’s fees against Kelly in a footnote, finding no abuse of discretion in the district court’s balancing of the relevant factors.

As a result, Kelly’s appeal was mostly unsuccessful. However, the Fourth Circuit’s ruling in his favor on his document disclosure claim gives ERISA plaintiffs further ammunition in their efforts to expand the scope of documents that are subject to statutory penalty exposure.

Below is a summary of this past week’s notable ERISA decisions by subject matter and jurisdiction.

Arbitration

Seventh Circuit

PHI Health, LLC v. Health Care Service Corp., No. 26 C 2954, 2026 WL 2254879 (N.D. Ill. Aug. 5, 2026) (Judge Matthew F. Kennelly). PHI Health provided out-of-network air ambulance services to patients covered by health plans administered by Health Care Service Corporation, which operates various Blue Cross Blue Shield entities. PHI alleges that HCSC issued underpayments for twelve of PHI’s air ambulance transports. PHI invoked the dispute resolution process under the federal No Surprises Act (NSA), culminating in independent dispute resolution (IDR) proceedings. PHI prevailed in those proceedings, but PHI alleges HCSC failed to pay within the NSA’s 30-day statutory deadline and did not seek vacatur, modification, or correction of the awards. (PHI contends that this reflects a broader HCSC pattern of underpaying and delaying claims, and then ignoring awards once they are obtained.) PHI thus filed this action asserting six claims. Three seek to enforce the IDR award under the NSA itself (Count 1), the Federal Arbitration Act (FAA) (Count 2), or the Illinois Uniform Arbitration Act (IUAA) (Count 3). The remaining claims seek declaratory and injunctive relief (Count 4), relief under ERISA §§ 502(a)(1)(B) and 502(a)(3) (Count 5), and relief under the Illinois Consumer Fraud and Deceptive Business Practices Act (Count 6). HCSC moved to dismiss the complaint for failure to state a claim. Addressing the NSA claim first, the court held that the NSA contains neither an express nor implied private right of action to enforce or confirm IDR awards. The court acknowledged that the statute has “shall be binding” language which is “rights-creating,” but that was insufficient; “Congress must intend to create a private remedy.” The NSA has an administrative enforcement scheme empowering HHS, the Department of Labor, and the Department of Treasury to assess penalties against noncompliant insurers, and this choice of remedy suggested that Congress did not intend a judicially implied private right of action. PHI contended that regulatory review was not “a true enforcement mechanism,” but the court responded that it was “not a court’s role…to step in and create a private right of action simply because private enforcement may provide a more effective remedy than the mechanism Congress chose.” In so ruling, the court agreed with the Fifth Circuit’s decision in Guardian Flight LLC v. HCSC (discussed in Your ERISA Watch’s June 18, 2025 edition) and the majority of district courts (including two other judges in the same district) over contrary decisions. As for the FAA and IUAA claims, the court ruled that both statutes require a written agreement to arbitrate before a court may confirm an award, and no such agreement existed here. PHI argued that HCSC’s participation in the IDR process constituted agreement to arbitrate, but the court rejected this, joining other courts that have held that the FAA cannot be used to enforce NSA awards absent an actual written arbitration agreement. On PHI’s ERISA claims, the court found PHI’s theory of standing conflated Article III standing with ERISA’s separate “zone of interests” requirement. Although the court agreed that patients had validly assigned their benefits to PHI, PHI’s claim in this action was not based on those benefits but on HCSC’s failure to pay IDR awards, which was a duty HCSC owed independently to PHI. “The patients could not bring a claim to enforce the awards, and thus the patients have no claim to assign to PHI. The Court thus concludes that PHI cannot bring a claim to enforce the NSA awards under ERISA because the claim does not fall within the Act’s zone of interests.” The court also ruled that PHI did not have any independent claim under ERISA because it never alleged it was a “participant,” “beneficiary,” or “fiduciary,” which is required in order to obtain relief under ERISA’s civil enforcement scheme. On PHI’s Illinois Consumer Fraud Act claim, PHI conceded it was not a “consumer” and thus had to satisfy the “consumer nexus” test, which required showing the disputed conduct occurred “primarily and substantially” in Illinois. The court ruled that PHI failed this test. PHI did not render services in Illinois, the affected patients were not Illinois residents, and PHI’s argument that HCSC’s Illinois headquarters directed claims-processing policy did not relate to conduct directed at the Illinois market or consumers. Finally, the court dismissed PHI’s claim for declaratory/injunctive relief. Because this claim was derivative of the other counts, and no viable underlying claim survived, it could not proceed independently. The court thus granted HCSC’s motion to dismiss in its entirety, but gave PHI leave to amend.

Attorneys’ Fees

Fifth Circuit

Krongold v. American Air Liquide Holdings, Inc., No. 4:24-CV-01971, 2026 WL 2230506 (S.D. Tex. July 27, 2026) (Magistrate Judge Christina A. Bryan). Plaintiff Martin Krongold worked as a mechanical engineer for Messer Griesheim Industries (MGI) from 1984 to 1991, and then at American Air Liquide Holdings, Inc. until 2016. Air Liquide assumed sponsorship of the MGI pension plan through a 2004 acquisition. In 2021, as Krongold approached retirement age, Air Liquide informed him that his MGI and Air Liquide pension benefits would be calculated separately, rather than combined. Krongold thus brought this action against Air Liquide, asserting a benefits claim (Count I), “for his car allowance,” and an equitable estoppel claim (Count II), arguing that his MGI and Air Liquide pension benefits should be combined. The court granted summary judgment to Krongold on Count I in 2024 (Air Liquide did not oppose his motion), and in 2025 the court held a bench trial on Count II. The court “concluded that while Defendant made material misrepresentations to Plaintiff, Plaintiff did not prove reasonable detrimental reliance or extraordinary circumstances.” Thus, judgment was entered in Air Liquide’s favor on Count II. At issue now is attorney’s fees. The court declined to award them to Air Liquide, and Krongold’s motion for fees was referred to the assigned magistrate judge, who issued this ruling. Krongold sought “almost one million dollars” in his motion. This relief consisted of three parts: (1) $238,431.50 in attorney’s fees; (2) $13,088.63 in expenses; and (3) “‘other remedies’ totally unrelated to fees and costs,” including prejudgment interest of $396,327.68, statutory penalties of $140,250, an accounting of benefits from August 2021, and “gross-ups” to account for tax liability ($172,998.15) and Medicare ($19,547.06). The court quickly disposed of the third category, finding it “easily rejected.” The court ruled that a post-judgment fee motion cannot be used to assert new claims for relief not awarded in the final judgment, and that tax consequences are not one of the factors to be considered in awarding fees. Next, the court rejected category two, holding that 28 U.S.C. § 1920 strictly limits recoverable costs to those enumerated in the statute and that any recoverable costs should have been included in Krongold’s previously filed bill of costs. “The Court finds no good cause to entertain a second request for additional costs, many of which are not taxable under § 1920.” Thus, the court turned to category one, “[t]he only appropriate relief Plaintiff seeks in his motion[.]” The court found that Krongold achieved “some degree of success on the merits” by prevailing on his car allowance claim, but achieved no success on his equitable estoppel claim. As a result, the court limited fee eligibility to work performed on Count I between the filing of the complaint and the 2024 summary judgment ruling in Krongold’s favor on that count. Because Krongold’s fee motion did not segregate fees attributable to the recoverable Count I from the unrecoverable Count II, the court applied a percentage-reduction approach. First, limiting the fee request to invoices predating October 17, 2024 reduced the lodestar to $110,350.80. The court then found, based on the billing entries (which included extensive discovery and legal research specific to the equitable estoppel theory), that the bulk of the time expended during this period was still attributable to the more complex and discovery-intensive Count II rather than the simpler Count I benefits claim. Thus, the court applied a further 70% reduction, yielding a final recommended fee award of $33,105.24. The court found this to be “consistent with the Fifth Circuit’s guidance that attorneys’ fees ‘must be reasonable under the particular circumstances of the case and must have some reasonable relationship to the amount in controversy or to the complexity of the issue to be determined.’” The court declined to award any additional fees for time spent preparing the fee motion itself because the motion “seeks excessive fees, overly broad relief, and is longer than necessary.” Finally, the court recommended denying prejudgment interest entirely, reasoning that such interest compensates for the “use of funds,” and Krongold “has never applied for distribution of his benefits. Thus, the car allowance issue did not delay or deprive Plaintiff of the use of his money.” The parties were given 14 days to appeal this ruling to the district court judge.

Ninth Circuit

Wagoner v. State Indus. Prods. Corp., No. CV-25-01763-PHX-JJT, 2026 WL 2247759 (D. Ariz. Aug. 4, 2026) (Judge John J. Tuchi). This is one of two cases this week involving plaintiff Gary L. Wagoner. Wagoner is a physician who has brought numerous unsuccessful cases in Arizona federal court, both in his name and in the name of trusts he controls, attempting to recover assigned benefit payments from insurers of ERISA-governed health plans. In this particular case, Wagoner sued State Industrial Products Corporation regarding underpaid medical claims relating to services he provided to a patient in 2018. The court has already dismissed all of Wagoner’s claims with prejudice (see our coverage in our January 7, 2026 edition for more details), and separately denied his motion for relief from that judgment. Wagoner then filed a motion for leave to amend and a motion for sanctions, both of which were quickly denied in this order. The court found that Wagoner’s motion to amend was procedurally improper, his claims were still defective, and that he inappropriately filed “several documents…on the public record that contain personal identifying information and medical records of his former patient, a non-party to this action,” which the court ordered sealed. The court also found no unreasonable or bad faith conduct by defendant that would support sanctions. On the other hand, the court noted that Wagoner sent defendant a demand letter threatening extensive discovery and reputational harm in which he stated, “[T]his process does not end quietly; it ends with headlines higher D&O premiums, and copycat litigation[.]” Wagoner declared that he “cannot be priced out, delayed, or worn down” unless defendant settled. He also filed complaints against defendant with the Arizona Attorney General and the FBI, using those filings as leverage to demand a large settlement and withdrawal of defendant’s fee motion. In short, “it is Plaintiff’s own conduct that is of great concern to this Court and will expound on this point further in the next section.” That section involved defendant’s motion for attorney’s fees. Applying the Ninth Circuit’s five-factor Hummell test for fee awards under ERISA, the court found the factors favored an award. On culpability/bad faith, the court found Wagoner acted in bad faith by initially pleading around ERISA to avoid preemption and by using the litigation as leverage for a settlement demand, evidenced by his threatening demand letter. On ability to pay, the court rejected Wagoner’s claimed financial hardship, noting he provided no supporting detail, had inflated his claimed damages from $6,945 in the original pleading to over $311,000 post-dismissal apparently to manufacture an appearance of hardship, and maintained an ongoing chiropractic practice. The remaining factors (deterrence, benefit to other plan participants, and relative merits) likewise favored defendant, particularly since Wagoner did not meaningfully contest them and his “new evidence” of bad faith (pre-authorization letters followed by a coverage denial) did not establish any unlawful conduct. Thus, the court turned to calculating a reasonable award. Applying the lodestar method, the court found defense counsel’s hourly rates ($360 and $305) reasonable and consistent with market rates, but reduced several billing entries by 40% as excessive (e.g., over 20 hours spent on a reply brief raising largely the same arguments as the original motion) or insufficiently itemized (block-billed entries mixing multiple tasks). The court also disallowed entirely certain unexplained or unverifiable entries, including communications with an unidentified individual not otherwise appearing in the record. After these reductions, the court approved $25,625.30 in fees and $954.06 in costs.

Breach of Fiduciary Duty

Sixth Circuit

Greenwood v. Cigna Health & Life Ins. Co., No. 4:25-CV-1759, 2026 WL 2263158 (N.D. Ohio Aug. 6, 2026) (Judge John R. Adams). Ross Greenwood was a beneficiary of a self-insured ERISA-governed health plan administered by Cigna Health and Life Insurance Company which covered medically necessary residential mental health treatment. Greenwood was admitted for residential treatment for major depression in 2024, but Cigna denied benefits for his stay. In this action Greenwood alleges that Cigna improperly relied on the MCG Behavioral Health Guidelines in finding his stay not medically necessary. Based on this theory he is pursuing class relief based on ERISA claims for breach of fiduciary duty, violation of plan terms, and breach of co-fiduciary duty. For remedies, he seeks declaratory and injunctive relief to prohibit Cigna’s ongoing use of the MCG Guidelines, and also reprocessing of his claims without application of those guidelines. Notably, Greenwood did not bring a claim for failure to pay plan benefits. Cigna moved to dismiss on several grounds, but argued principally that because Greenwood was no longer a plan beneficiary he did not have standing to seek equitable relief. The court agreed, resolving the motion entirely on that ground. It explained that Article III requires an “injury in fact” that is “concrete and particularized,” “actual or imminent, not conjectural or hypothetical,” is fairly traceable to the defendant’s conduct, and likely to be redressed by a favorable decision. According to the court, Greenwood’s allegations fell short regarding the “concrete stake” element: “Under the facts alleged here, to the extent that Greenwood seeks to prohibit the use of the MCG Guidelines in the future, his status as a former plan participant compels the conclusion that he does not have a concrete stake in the outcome. Any future processing of mental health claims under the existing plan will never impact Greenwood. Accordingly, regardless of any argument surrounding statutory standing, Greenwood cannot meet the requirement of Article III standing.” Greenwood argued that his request for reprocessing of his claim supported standing, but the court disagreed because “the complaint wholly fails to allege in his complaint that such a remedy would actually redress his injury.” The court ruled that in order to have standing, Greenwood “must, at a minimum, allege that reprocessing will remedy that injury. In other words, Greenwood must allege that absent use of the MCG Guidelines, he would be entitled to benefits.” However, Greenwood’s allegations did not support such a conclusion: “The denial of his benefits makes clear that the finding of medical necessity was not based solely on the MCG Guidelines. Rather, the denial letter detailed that Cigna relied on more than the Guidelines in denying the claim.” As a result, Greenwood’s reprocessing request failed for redressability reasons. The court thus ruled that Greenwood did not have standing, granted Cigna’s motion, and dismissed Greenwood’s complaint.

Eighth Circuit

Hodges v. Washington Regional Med. System, No. 5:26-CV-05070, 2026 WL 2296091 (W.D. Ark. Aug. 10, 2026) (Judge Timothy L. Brooks). Plaintiffs Donald Hodges and Joyce Kendrick are participants in the Washington Regional 401(k) Plan, a defined-contribution plan sponsored by their employer, Washington Regional Medical System (WRMS), to which employees contribute tax-deferred wages matched by WRMS. From 2016 to 2024, the plan’s most popular investment option was the American Century (AC) Target Date Fund, which held between 68% and 76% of plan assets. (Target date funds allocate assets based on a participant’s expected retirement date, shifting that mix as retirement approaches.) Plaintiffs contend in this putative class action that the AC fund underperformed comparable target date funds for years. To support their underperformance theory, plaintiffs compared the AC fund’s returns to four other target date fund families: the American Funds Retirement Series, Vanguard Target Retirement Series, T. Rowe Price Target Series, and BlackRock LifePath Index series. Plaintiffs contend that these funds “consistently outperformed most alternatives,” and, based on their large market share, were “the most often selected TDF options.” In Count I they contend that WRMS and its pension committee breached their ERISA fiduciary duties both by initially selecting the AC fund and by continuing to retain it despite its underperformance, and in Count II they allege that defendants derivatively breached their duty to monitor the plan’s fiduciaries. Defendants moved to dismiss for failure to state a claim. The court relied on Eighth Circuit precedent in stating that a fiduciary-breach claim requires more than an allegation that costs were too high or returns too low; a plaintiff must supply “a sound basis for comparison – a meaningful benchmark.” As a result, plaintiffs were required to present comparator funds that “hold similar securities, have similar investment strategies, and reflect a similar risk profile.” Plaintiffs contended that their four alternative funds were prominent, high-market-share TDF families, but this was insufficient for the court: “the fact that certain TDFs are ‘the top 5 largest’ and ‘account[ ] for 80% of all TDF-invested dollars’ does not make them comparable benchmarks to other TDFs.” The court stated that “fiduciaries select TDFs for any number of reasons” and plaintiffs cited no authority treating market prominence as a proxy for similar strategy or risk. Furthermore, the complaint “is silent about whether the comparators they have selected hold similar securities, have similar strategies, and reflect a similar risk profile as compared to AC TDF. The lack of such facts is fatal to the Complaint[.]” The court highlighted plaintiffs’ concession that they selected comparators sharing only “the same retirement-allocation purpose and the same glide-path [to retirement] structure” as the AC fund while acknowledging those comparators might carry “relatively more (or less) risk.” Plaintiffs argued they neutralized any such differences by applying their own “risk-adjusted performance metrics,” but the court concluded that risk-adjusted ratios “are not magic wands that equalize any two investments as meaningful benchmarks in the first place[.]” As a result, plaintiffs did not meet their burden of pleading meaningful benchmarks, and defendants’ motion to dismiss Count I was granted. The duty-to-monitor claim in Count II fell with it because it was derivative of Count I. The complaint was dismissed without prejudice.

Scholin v. Digi-Key Corp., No. 26-CV-1485 (JMB/LIB), 2026 WL 2234404 (D. Minn. Aug. 3, 2026) (Judge Jeffrey M. Bryan). In our second case involving American Century this week, plaintiff Paige Scholin is a former employee of Digi-Key Corporation and a participant in the company’s 401(k) Profit Sharing Plan. She alleges in this putative class action that from 2018 through at least the end of 2023, the plan retained target date funds (TDFs) managed by American Century. Scholin alleges these TDFs “consistently underperformed other prudent target date series options” across all metrics, including investment performance, risk-adjusted performance, and market acceptance of glide path and investment philosophy. Thus, she contends that the fiduciary defendants should have removed the TDFs from the plan’s menu by early 2020 at the latest. As in the Hodges case discussed above, Scholin presented as comparators four alternative TDF series that performed better: the Capital Group Target Retirement Series (American Funds), Vanguard Target Retirement Series, T. Rowe Price Target Series, and BlackRock LifePath Index series. She brought two claims under ERISA: (1) breach of the fiduciary duty of prudence under 29 U.S.C. § 1104(a)(1)(B), and (2) failure to adequately monitor plan fiduciaries. Defendants moved to dismiss both for failure to state a claim. On Scholin’s prudence claim, the court held that she failed to plead a “meaningful benchmark” for comparison as required by Eighth Circuit precedent. The court acknowledged that Scholin had presented four comparators, but the complaint contained no factual detail about their glide paths, specific investment holdings, objectives, or risk profiles, nor any explanation of how their structures were “sufficiently similar” to the plan’s TDFs. “Absent such allegations, the composition of these comparator TDFs ‘remains a mystery[.]’” The court also noted additional concerns that the complaint focused on poor fund performance rather than alleging a flawed decision-making process, and lacked detail on the “duration and magnitude” of the TDFs’ underperformance. However, the court’s ruling was not based on these concerns because the benchmark deficiency was sufficient to grant defendants’ motion. As for the failure to monitor claim, because it was derivative of Scholin’s underlying fiduciary breach claim, it necessarily failed as well. Defendants’ motion was thus granted, albeit without prejudice.

Ninth Circuit

Andrews v. Wilson Electric Services Corp., No. CV-24-00995-PHX-DJH, 2026 WL 2283444 (D. Ariz. Aug. 7, 2026) (Judge Diane J. Humetewa). Plaintiffs Daniel Andrews and Matthew Baker are employees of Wilson Electric Services Corporation (WESC) and participants in the company’s ERISA-governed Employee Stock Ownership Plan (ESOP). Naturally, the ESOP contains company stock, but it also has an “Other Investments Account” (OIA) containing more than $11 million. Plaintiffs allege that WESC, its plan committee, and six individual defendants who served on WESC’s board kept the OIA “invested exclusively in bank deposit and money market accounts during all or most of the subject period,” generating minimal returns. This meant that “the OIA funds depreciated in real value, and the retirement savings of ESOP participants effectively shrunk.” Plaintiffs’ operative third amended complaint asserts that defendants breached their fiduciary duty of prudence under 29 U.S.C. § 1104(a)(1) by failing to invest the OIA consistent with the ESOP’s retirement-savings objectives. The complaint also contains derivative claims for failure to monitor and co-fiduciary liability. Defendants moved to dismiss, arguing that (1) the Ninth Circuit’s 2025 decision in Anderson v. Intel (discussed in our May 28, 2025 edition and currently scheduled to be argued before the Supreme Court on October 6) foreclosed plaintiffs’ theory, (2) ERISA’s diversification exemption for ESOPs barred plaintiffs’ claims, (3) plaintiffs’ own allegations showed that the OIA was invested prudently, (4) the individual defendants were not adequately alleged as fiduciaries, and (5) the monitoring and co-fiduciary claims failed for being derivative of other failed claims. Regarding Anderson, the court found that defendants “overstate the import of the case and its impact on the present matter.” It stated that Anderson held only that a plaintiff relying on a purely circumstantial, underperformance-based theory must compare the challenged fund to a “meaningfully similar” benchmark. Defendants argued that under Anderson plaintiffs “cannot challenge a fiduciary’s risk-mitigation objective,” but the court noted that defendants “do not address whether there is a stated risk-mitigation objective here.” Instead, the ESOP’s stated purpose was to let participants “share in the growth and prosperity” of the company and “accumulate capital for their future economic security.” Defendants “do not identify any information establishing that a risk-minimization strategy was communicated to plan participants.” Furthermore, plaintiffs cleared Anderson’s requirement for a meaningful benchmark. The complaint identified specific comparator ESOPs that invested 60% to 95% of similar OIA balances in stocks, and cited a broader dataset showing that among comparable ESOPs, the median allocation to cash and short-term treasuries was just 17%, not 100% as here. The court found these allegations “sufficient to avoid dismissal.” The court added that, regardless of any comparators, plaintiffs had alleged a “mismatch” between the OIA’s all-cash allocation and the ESOP’s stated purpose of providing growth-oriented retirement benefits, which further supported a finding of a breach of the duty of prudence. The court relied on two 2026 district court decisions from the Ninth Circuit to support this argument, Moran v. ESOP Committee and Dawson-Roberts v. Norman S. Wright Mech. Equip. Moving on to defendants’ argument regarding ERISA’s diversification exception for ESOPs, the court again followed Moran and Dawson-Roberts, holding that the exception in 29 U.S.C. § 1104(a)(2) is limited in application to “qualifying employer securities,” and says nothing about the prudent management of non-employer-security assets like the OIA. The court also rejected defendants’ argument that the complaint actually pled prudent investment, clarifying that plaintiffs challenged only the OIA’s cash allocation, not the ESOP’s broader mix of WESC stock and other holdings. As for the individual defendants, the court found plaintiffs’ allegations “a bit thin,” but adequate, because plaintiffs alleged that each individual served on the board, which in turn directed the committee’s plan investment decisions. Finally, because plaintiffs’ prudence claim survived, the derivative failure to monitor and co-fiduciary claims survived as well. Thus, defendants’ motion to dismiss was denied in full.

Class Actions

Ninth Circuit

Bozzini v. Ferguson Enterprises LLC, No. 22-CV-05667-AMO, 2026 WL 2255455 (N.D. Cal. Aug. 5, 2026) (Judge Araceli Martínez-Olguín). This is a class action concerning alleged fiduciary breaches in the management of a retirement plan sponsored by Ferguson Enterprises LLC. Plaintiffs asserted four claims for relief under ERISA against Ferguson and related entities, contending that they breached their duty of prudence by allowing the plan to retain underperforming funds, not investing in lower cost shares, choosing actively managed funds instead of passively managed index funds, and declining to invest in better-performing funds. The court previously granted defendants’ motion to dismiss two of the four claims, leaving only the breach of prudence and failure to monitor claims, which centered on allegations of excessive recordkeeping fees. The parties subsequently negotiated a class settlement. Plaintiffs’ first motion for preliminary approval was denied in January of this year, as the court identified multiple deficiencies under the Northern District of California’s Procedural Guidance for Class Action Settlements (the “Guidelines”). Plaintiffs thus filed an amended motion attempting to cure the deficiencies identified. As the court explained in this order, they were unsuccessful. The court ruled that plaintiffs failed to correct several previously identified problems and identified additional new deficiencies. First, the court found unexplained discrepancies in the class definition as set forth in the operative complaint, the settlement agreement, and the long form notice to class members. Second, although plaintiffs represented that the settlement released only the surviving claim for excessive recordkeeping fees, the settlement agreement’s actual “Released Claims” definition swept more broadly, covering far more claims without adequate explanation for the discrepancy. Third, the proposed notice improperly directed objecting class members to send objections to both the parties’ counsel and the court, instead of just the court. It also imposed an objector disclosure requirement not authorized by the Guidelines, and failed to clearly state that the court cannot modify the settlement’s terms. The notice also contained outdated courthouse information. Fourth, the proposed schedule did not afford class members the Guidelines-required minimum of 35 days to opt out or object to the settlement and fee motion, nor did it give the court adequate time to review objections and responses before the final fairness hearing. Fifth, the court identified an unexplained discrepancy between the settlement agreement’s stated cap on settlement administration fees ($110,000) and the figure represented in the motion and notice ($120,000), as well as the motion’s omission of a separate recordkeeper fee (capped at $1,500) that was listed in the agreement. Sixth, plaintiffs cited two comparator cases to support their motion but failed to provide the specific comparative metrics the Guidelines require. The court also gave instructions regarding any amended motion, directing plaintiffs to provide specific case citations with pincites supporting comparable language, ideally summarized in easy-to-read comparison charts, and reminded plaintiffs to submit Word-format versions of proposed orders and notices as required by the Guidelines. As a result, plaintiffs’ motion was denied and they will have to try a third time.

Schuman v. Microchip Technology Inc., No. 16-CV-05544-HSG, 2026 WL 2227356 (N.D. Cal. Aug. 3, 2026) (Judge Haywood S. Gilliam, Jr.). When we last checked in on this case in our June 10, 2026 edition, it was scheduled to go to trial on July 13. As explained below, that did not happen. As a refresher, this is a long-running class action filed in 2016 alleging that Microchip Technology and related defendants failed to pay severance benefits owed under the Atmel Corporation U.S. Severance Guarantee Benefit Program. Crucial to the case was the allegation that defendants improperly solicited releases from class members in exchange for only partial benefits. Indeed, 215 of the 220 class members signed releases in exchange for partial severance. In 2023 the court granted partial summary judgment to defendants on this issue, ruling that the named plaintiffs’ releases were enforceable under a six-factor test. Plaintiffs appealed, and the Ninth Circuit reversed in a published opinion, articulating a new non-exhaustive nine-factor test for evaluating release enforceability. This test included consideration of whether the fiduciary engaged in improper conduct in obtaining the release, a factor the Ninth Circuit stated “may weigh particularly heavily” against enforceability. (This ruling was Your ERISA Watch’s case of the week in our June 11, 2025 edition.) After remand, the district court denied defendants’ motions to decertify the class and reopen discovery. Defendants apparently did not like which way the wind was blowing, and on the eve of trial the parties reached a $13 million settlement. In this order the court approved plaintiffs’ motion for preliminary approval of the settlement under Federal Rule of Civil Procedure 23(e). At the outset, because the settlement class definition mirrored the class already certified, and was recently examined in the court’s June order, the court found no need to revisit its prior Rule 23(a)/(b) analysis and thus provisionally certified the class. As for the settlement itself, it proposed that the five class members who never signed releases would receive 100% of their unpaid severance benefits plus interest, while the two named plaintiffs and the 213 class members who did sign releases would receive 80% of unpaid severance plus interest. The named plaintiffs would also receive $10,000 incentive awards, and class counsel would seek attorneys’ fees not exceeding $3.5 million. The court noted that the settlement contained a “clear sailing” provision by which defendants would not challenge plaintiffs’ fees, but the court was not concerned because the proposed fees were below the lodestar and were negotiated only after the substantive settlement terms were set. Furthermore, the fee award would not reduce class recovery and class members were receiving a substantial remedy; indeed, “[w]hen accounting for interest…Class Members’ recovery will exceed 100% of their unpaid severance amounts.” The court further found the settlement “within range of possible approval” given significant litigation risk. The court noted that the Ninth Circuit’s new multi-factor release-enforceability test would need to be litigated, and it was possible that predominance issues could undermine class certification. The court thus determined that “the settlement amount, given these risks, weighs strongly in favor of granting preliminary approval.” The court further approved the proposed notice plan, but directed counsel to include specific language stating the deadlines for filing and objecting to the attorneys’ fees and incentive award motions. The court also ordered the parties to meet and confer to set a schedule for finalizing approval of the settlement.

Disability Benefit Claims

Fourth Circuit

Wingfield v. United of Omaha Life Ins. Co., Civ. No. 3:25-11648-MGL, 2026 WL 2268478 (D.S.C. Aug. 6, 2026) (Judge Mary Geiger Lewis). Troy Wingfield was employed by Still Hopes Episcopal Retirement Community and was covered by his employer’s ERISA-governed long-term disability benefit plan, which was insured and administered by United of Omaha Life Insurance Company. Wingfield filed a claim for benefits under the plan, but United denied it. Wingfield alleges that he appealed, informed United that he was obtaining medical records, and asked United for an extension to submit those records, but United “completely ignored” the request and upheld its decision. Wingfield thus filed this action, asserting a single claim for plan benefits under 29 U.S.C. § 1132(a)(1)(B). However, rather than seeking a benefits award outright, the complaint asked only “that Plaintiff is entitled to a remand of his claim to Defendant for a full and fair review.” Wingfield contended that United “failed to allow a reasonable time period for Plaintiff to submit, and for Defendant to consider, important evidence Plaintiff intended to provide in support of his appeal.” Wingfield filed a motion to remand, which the court decided in this order. The court explained that remand to a plan administrator is a discretionary remedy, “most appropriate ‘where the plan itself commits the trustees to consider relevant information which they failed to consider.’” However, that remedy was inappropriate here because the medical records Wingfield wanted more time to gather were irrelevant to why his claim was actually denied. The plan required Wingfield to satisfy a 90-day waiting period, but United’s records showed that he was out of work for only 49 days. United’s denial letters repeatedly informed Wingfield that because he returned to work, with no loss in earnings, he did not satisfy the plan’s definition of disability. United’s final denial specifically noted that Wingfield’s appeal offered “no explanation” of how the additional records he sought “may be relevant to the denial of the claim given this was not a medical decision denial.” Because Wingfield’s only claim was a request for remand, and the court found remand “pointless,” it denied his motion and dismissed the case without prejudice. In doing so the court expressly declined to decide whether United “provided Wingfield with a sufficient opportunity in which to provide supporting documentation, as required by regulation.”

Ninth Circuit

Mendoza v. First Unum Life Ins. Co., No. 25-3080, __ F. App’x __, 2026 WL 2295887 (9th Cir. Aug. 10, 2026) (Before Circuit Judges Rawlinson, Sanchez, and Tung). Siam Mendoza submitted a claim for ERISA-governed long-term disability benefits after he was hospitalized for COVID-like symptoms in 2021. The plan’s insurer, First Unum Life Insurance Company, denied his claim, contending that Mendoza was not disabled throughout the plan’s elimination period. Mendoza thus brought this action seeking plan benefits under 29 U.S.C. § 1132(a)(1)(B). Under de novo review the district court concluded that Mendoza had not carried his burden to prove that he was disabled and entitled to benefits. (Your ERISA Watch covered this decision in our May 21, 2025 edition.) Mendoza appealed to the Ninth Circuit, which affirmed in this brief memorandum disposition, rejecting all four grounds Mendoza raised on appeal. First, it held the administrative record adequately supported the district court’s factual finding that Mendoza was not disabled under the plan: “After comparing the assessments from Plaintiff’s and Defendant’s set of experts, the district court found that Plaintiff had not met his burden to show he was disabled. That is enough to survive clear error review.” Second, Mendoza argued the district court erred by crediting First Unum’s non-examining, record-reviewing physicians over his own physicians. The court noted that courts are not required to give special deference to examining physicians, citing the Supreme Court’s 2003 decision in Black & Decker Disability Plan v. Nord. The Ninth Circuit added that the district court’s ruling was partly based on Mendoza’s own experts, who found that his “cognitive test performance was within normal limits.” Third, Mendoza contended that First Unum’s earlier payment of short-term disability benefits should have created a legal presumption that he was also disabled for long-term disability purposes. The court rejected this, stating that “no such presumption exists under our caselaw, and we have rejected similar propositions… Instead, our caselaw treats prior payment of benefits merely as relevant evidence of disability.” The district court was thus free to weigh, rather than defer to, the prior payments. Finally, Mendoza argued the district court improperly upheld the denial based on rationales First Unum never raised during the administrative claims process, contrary to the Ninth Circuit’s decision in Collier v. Lincoln Life that a court “clearly errs by adopting a newly presented rationale” not raised below. Mendoza asserted two examples: an inference that testing by one of his physicians showed signs of malingering, and a determination that witness statements submitted with his administrative appeal were not credible because they conflicted with the medical evidence. The panel disagreed that these were truly new rationales, and instead found that “those ‘new’ issues are merely subsidiary to a pre-litigation rationale that Defendant asserted in its denial of Plaintiff’s claim: that Plaintiff’s ‘self-reported symptoms are disproportionate’ to his ‘clinically unremarkable’ medical testing results.” In short, the court viewed the district court’s findings as simply elaborations on the original denial rationale rather than freestanding new grounds for denial. As a result, the court affirmed the judgment in First Unum’s favor.

ERISA Preemption

Third Circuit

Bowden v. Express Scripts, Inc., No. 3:25-cv-261, 2026 WL 2272715 (W.D. Pa. Aug. 6, 2026) (Judge Robert J. Colville). Garrett Bowden has health insurance through UPMC Health Plan (also known as Highmark) and is a longtime patient of Martella’s Pharmacies, “which Plaintiff describes as a critical healthcare provider in Cambria County and its surrounding areas that operates six community-based retail pharmacy locations and serves thousands of Cambria County and neighboring community residents.” Bowden is suing Express Scripts, Inc. (ESI) in its capacity as the pharmacy benefits manager for UPMC/Highmark members. ESI had a provider agreement with Martella’s, but in 2025 ESI announced it was dropping Martella’s from its network. Bowden alleges that this resulted in higher out-of-pocket costs, loss of home-delivery and adherence-packaging services, and increased health risks. He brought this putative class action in state court asserting state law causes of action. Defendants removed it to federal court based on ERISA and Class Action Fairness Act (CAFA) preemption and Bowden moved to remand. His motion was unsuccessful, as the court agreed with defendants that his claims were preempted by ERISA. (We covered this ruling in our September 24, 2025 edition). The court gave Bowden an opportunity to amend his complaint, which he took advantage of, asserting new state law claims in an effort to stay out of ERISA’s clutches. The amended complaint dropped any express reference to health benefits and instead pled a third-party-beneficiary breach of contract claim (based on the ESI-Martella’s provider agreement), a tortious interference with prospective economic relations claim, and once again a claim for violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law (UTPCPL). Bowden stressed in his new complaint that his class does “not seek to recover benefits or enforce plan terms[,]” but instead seeks “to enforce independent contractual and statutory duties owed to them as third-party beneficiaries and Pennsylvania consumers.” Bowden also renewed his motion to remand, while defendants moved to dismiss the new complaint. Bowden also moved for a preliminary injunction to reinstate Martella’s network status. The court denied Bowden’s renewed remand motion, holding that his new claims remained completely preempted by ERISA. The court’s analysis was the same as before “because, while Plaintiff has renamed his claims, the underlying facts and relief sought remain materially unchanged. As the Court previously noted, a plaintiff ‘cannot circumvent the preemptive reach of ERISA by artful pleading.’” Applying the two-part test from Aetna v. Davila, the court asked whether Bowden could have brought his claims under ERISA § 502(a) and whether any legal duty independent of the plan supported them. On the first question, the court found it “abundantly clear” that Bowden’s actual grievance was that Martella’s was no longer in-network, and “network scope” is a core aspect of plan benefit design. “Accordingly…Plaintiff’s claims implicate the administration of a health benefit plan,” and thus failed prong one of Davila. On the second question, the court found no independent duty could rescue Bowden’s claims. The breach of contract claim failed because Bowden cited no authority allowing him to sue as a third-party beneficiary of a PBM-pharmacy contract. The court reasoned that allowing such a remedy would mean “any health benefit plan participant would be able to circumvent the broad preemptive effect of ERISA.” Furthermore, if Bowden was correct, and ESI had breached its contract with Martella’s, “it is Martella’s, not Plaintiff,” who must pursue relief. The tortious interference claim also failed. That tort’s first element requires a relationship between the plaintiff and a third party which did not exist here; instead, Bowden was asserting interference with Martella’s relationships. This was misleading because Bowden’s real issue was “whether Defendants’ removal of Martella’s as an in-network provider complied with the requirements of the putative class members’ health benefit plans.” The same analysis applied to Bowden’s UTPCPL claim, as “Plaintiff provide[d] no basis to revisit” the court’s analysis of that claim from his first complaint. As an independent, alternative basis for jurisdiction, the court also found CAFA’s requirements met and rejected Bowden’s invocation of the local controversy exception as unsupported. Thus, the court granted defendants’ motion to dismiss and denied Bowden’s motions to remand and for a preliminary injunction. However, the court agreed to give Bowden one final opportunity to replead claims under ERISA.

Torsiello Plastic Surgery & Wound Care LLC v. K.B., No. 25-18323, 2026 WL 2295345 (D.N.J. Aug. 10, 2026) (Judge Julien Xavier Neals). Patient K.B. underwent five knee surgeries in 2019 while covered under an ERISA-governed health plan administered by Oxford Health Insurance (a subsidiary of UnitedHealthcare). Plaintiff Torsiello Plastic Surgery & Wound Care LLC performed four of the five procedures. Plaintiff alleges that K.B. and her husband agreed to pay for the services rendered and assigned plaintiff their right to seek reimbursement from Oxford. According to the complaint, Oxford reimbursed only a fraction of the billed charges, leaving K.B. with substantial unpaid balances. Plaintiff thus sued K.B., Oxford, and UnitedHealthcare. Count One “‘interpleads all of the Defendants – in an effort to have the appropriate party/parties pay the appropriate amounts to the Plaintiff’ for services rendered,” while Count Two alleges that “Plaintiff deserves to be compensated for the value of said medical services from those who benefited.” Defendants removed the case to federal court, asserting ERISA preemption. They then moved to dismiss on four grounds: (1) United was an improper defendant, (2) Count One failed as a matter of law because it did not state a true interpleader action, (3) any ERISA benefits claim embedded in the complaint failed as a matter of law, and (4) Count Two was preempted. Plaintiff did not oppose the motion, but the motion was denied regardless because the court found it did not have subject matter jurisdiction. The court explained that removal requires that a federal issue appear on the face of a well-pleaded complaint. Count One, though mislabeled as interpleader, “resembles an ordinary breach of contract claim,” and Count Two sounded in common-law unjust enrichment. “No element of Counts One or Two requires the Court to interpret federal law.” The court thus turned to defendants’ complete preemption argument, applying the Third Circuit’s two-prong Pascack Valley test, which asks (1) whether the plaintiff could have brought its claim under ERISA § 502(a)(1)(B), and (2) whether an independent legal duty is implicated. The court found no need to discuss prong two because prong one was not satisfied. A healthcare provider is not a “participant” or “beneficiary” authorized to sue under § 502(a), and can only obtain standing derivatively through a valid assignment of benefits from a plan participant. Here, however, the plan contained an anti-assignment clause, and thus plaintiff was not the “type of party” who could bring a § 502(a) claim. Complete preemption therefore did not apply, the court lacked subject matter jurisdiction, and it remanded the case to state court, denying defendants’ motion to dismiss as moot. In a footnote, the court noted that defendants had advanced substantially similar, unsuccessful ERISA-preemption removal arguments in other cases, and warned them that continuing to do so might expose them to attorney’s fees and sanctions.

Sixth Circuit

Turner v. Transamerica Investors Securities, LLC, No. 2:26-CV-117, 2026 WL 2240172 (S.D. Ohio Aug. 4, 2026) (Judge Algenon L. Marbley). Jessica Turner requested a hardship distribution from her retirement plan to buy a house. In this pro se action she alleges defendants Transamerica Investors Securities, LLC, Transamerica Retirement Advisors, LLC, and Pension Design Group, LLC denied her request and gave her inaccurate information, forcing her to secure real estate financing on worse terms when closing on her home. Turner originally sued, pro se, in state court, but the Transamerica defendants removed the case to federal court, asserting that ERISA governed her claims and that Pension Design Group, LLC was defunct. Turner then moved for leave to file an amended complaint, and then five days later filed a “Notice of Voluntary Dismissal of All Federal Claims and Motion to Remand,” which attached yet another amended complaint which dropped all ERISA references and instead asserted only state law claims. In this order the court considered the first motion to be moot given the new complaint presented in the second motion. It then denied the second motion. The court ruled that Turner could not simply attach a revised pleading to her remand motion and treat it as automatically superseding her prior complaint. Because she had already amended once, she needed either defendants’ written consent or leave of court, neither of which she had acquired. Even if Turner wanted to sever her federal claims while preserving her state law claims, she had to follow Federal Rule of Civil Procedure 21, not Rule 41, which only allowed her to dismiss an entire action. As for allowing Turner to amend, the court declined, holding that her proposed state law claims were merely her original ERISA claims recast to evade federal jurisdiction. Applying the artful pleading doctrine, the court explained that a plaintiff cannot circumvent removal by disguising claims that are “essentially federal” as state law claims, and that removal remains proper where there is federal preemption. Here that was the case. ERISA’s preemption provision supersedes state laws relating to employee benefit plans, and Turner’s proposed contract, negligence, and fiduciary duty claims all arose from the same denial of her hardship distribution request under her ERISA-governed retirement plan. As a result, Turner’s claims impermissibly attempted to create an end-run around ERISA’s civil enforcement scheme and were preempted. Turner tried to rely on the Supreme Court’s 2025 decision in Royal Canin v. Wullschleger, but the court ruled that it was distinguishable because it did not address the artful pleading doctrine or ERISA preemption, and did not require the court to treat her newly proposed pleading as the operative complaint. The court closed by noting that it would approve substitution of Capital Pension Group, LLC for the defunct Pension Design Group, LLC upon proper motion.

Exhaustion of Administrative Remedies

Seventh Circuit

Stempel v. Unum Life Ins. Co. of Am., No. 24 C 6077, 2026 WL 2241244 (N.D. Ill. Aug. 4, 2026) (Judge John F. Kness). James A. Stempel was an attorney for Kirkland & Ellis LLP and a participant in its ERISA-governed long-term disability benefit plan, which was insured and administered by Unum Life Insurance Company of America. Stempel filed a claim for benefits under the plan, but Unum denied the claim in August of 2021, sending a letter with appeal instructions. Stempel claims he submitted his appeal in January of 2022, followed by another letter in July of 2022. In 2023 Stempel sent an inquiry, to which Unum responded it had never received his prior letters and that his deadline to appeal had expired. Stempel thus filed this action, asserting a single claim for recovery of benefits under ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B). The parties agreed to submit the threshold issue of whether Stempel exhausted his administrative remedies to the court under Federal Rule of Civil Procedure 52. The court first ruled that exhaustion was required by the plan. Stempel contended that the requirement was in the summary plan description, not in the plan, and was thus unenforceable, but the court found that the summary plan description was incorporated into the plan and thus its exhaustion provisions applied. The court further ruled that no exception to the exhaustion requirement existed because Stempel “was given explicit instructions regarding the review process,” and “[n]othing in the record of this case suggests that Plaintiff’s appeal would certainly have been denied.” The court thus turned to whether Stempel had exhausted, declaring that the issue “boils down to the mailbox rule, a federal common law presumption that mail properly sent is received.” The court ruled that Stempel could not avail himself of the presumption because he could not show that his letters were “properly sent.” The court was skeptical of Stempel’s factual account, noting that he offered no witnesses, no electronic copies, and inconsistent testimony about which laptop the letters were drafted on and whether the laptop had been recycled. The copy of the envelope he produced for the January 2022 letter was unstamped, unpostmarked, and incorrectly addressed. The court highlighted that Stempel alleged he began drafting the January 2022 appeal letter in March of 2021, which was before his claim was denied in August of 2021, which the court found “an unlikely circumstance.” The court also used Stempel’s experience against him, noting that he was “a former partner in a highly successful corporate restructuring practice” and thus should have “exhibited a level of sophistication of execution beyond what he exhibited here” and should have been “aware of the importance of maintaining orderly records.” Furthermore, neither of Stempel’s first two alleged letters were sent by trackable methods, although his 2023 letter was, which hurt his credibility. Unum’s mail room supervisor offered testimony about the company’s mail-handling protocols and its retention of digital mail records for at least seven years, and asserted that Unum had conducted a thorough search of both digital records and its physical facility that found no trace of either 2022 letter. Even if Stempel could invoke the presumption, however, the court found that Unum had rebutted it with its detailed evidence of non-receipt. As a result, because Stempel could not establish that he timely mailed his appeal, he failed to exhaust administrative remedies. Judgment was issued in Unum’s favor.

Pleading Issues & Procedure

Second Circuit

Cunningham v. Cornell University, No. 16-cv-6525 (PKC), 2026 WL 2269035 (S.D.N.Y. Aug. 6, 2026) (Judge P. Kevin Castel). This decade-old case is familiar to ERISA practitioners for its ascent to the Supreme Court last year. In that appeal the high court ruled that plaintiffs alleging prohibited transaction claims under ERISA Section 406(a) do not also have to plead that their claims are not covered by the exemptions in Section 408. In short, the court held that the exemptions in Section 408 are affirmative defenses for defendants to prove, not for plaintiffs to negate in their complaints. (We covered this decision as our case of the week in our April 23, 2025 edition.) Now the case is back in the district court. As a reminder, plaintiffs are participants in the Cornell University Retirement Plan and the Cornell University Tax Deferred Annuity Plan who sued Cornell and other fiduciaries of the plans, alleging they engaged in prohibited transactions under ERISA when they allowed the plan to pay recordkeeping fees to third-party administrators TIAA-CREF and Fidelity. Plaintiffs seek to make defendants “personally liable to make good to the Plans all losses to the Plans resulting from each breach of fiduciary duty, and to otherwise restore the Plans to the position they would have occupied,” along with more conventional equitable relief such as removal of fiduciaries, an accounting, and plan reformation. In 2018, after the district court dismissed plaintiffs’ prohibited transactions claim, defendants moved to strike plaintiffs’ jury demand on the claims then remaining, and the court denied that motion in part, holding that the “make good” relief sought by plaintiffs was legal, not equitable, and therefore triable to a jury. Now that the case has returned to district court, defendants have renewed their motion to strike the jury demand, arguing that recent appellate decisions have undercut the district court’s previous ruling. The court applied the two-part test from Tull v. United States, which required the court to first compare the ERISA claim to its 18th-century common-law analogue, and second (and “more important”) examine whether the remedy sought is legal or equitable. On the first prong, the court agreed with defendants (and “plaintiffs now appear to concede”) that breach of fiduciary duty claims would historically have been brought in equity. On the second prong, the court also agreed with defendants that “the Complaint’s request for relief in the form of removal of fiduciaries, an accounting, reformation of the Plans and ‘other equitable or remedial relief as the Court deems appropriate’ are traditional equitable remedies for which the prohibited transaction claim need not be tried to a jury.” However, the court again arrived at a different conclusion regarding plaintiffs’ request for “make good” relief. The court relied on the Second Circuit’s 2005 decision in Pereira v. Farace for the proposition that restitution only lies in equity if it seeks to “to restore to the plaintiff particular funds or property in the defendant’s possession.” Here, however, defendants never possessed the recordkeeping fees at issue because they were paid to TIAA-CREF and Fidelity, not defendants. Thus, “make good” monetary relief demanded from defendants is “legal in nature,” not equitable restitution. The court rejected defendants’ argument that two intervening decisions had overtaken Pereira. It found that the Second Circuit’s 2020 decision in Sullivan-Mestecky v. Verizon Communications Inc. answered a different question regarding equitable remedies under ERISA and did not address jury issues, and thus could not have overruled Pereira “sub silentio.” As for the Supreme Court’s 2024 decision in SEC v. Jarkesy, the court found it cut against defendants because it reaffirmed that “money damages are the prototypical common law remedy,” and asked whether a monetary remedy “restore[s] the status quo.” Here, “the defendant fiduciaries never possessed the fees that are the subject of the prohibited transaction claim and recovery is sought from the personal assets of the defendants,” and thus ordering them to pay from their own assets was a personal, legal liability and not a restoration of the status quo. The court closed by noting that it was joining three sister courts in the Circuit (Vellali v. Yale University, Khan v. Board of Directors of Pentegra Defined Contribution Plan, and Garthwait v. Eversource Energy Co.), all of which had denied similar motions to strike jury demands. As a result, if this case is tried, part of it will go a jury.

Third Circuit

Birmelin v. Verizon Pension Plan for Assocs., No. 3:24-cv-1369, 2026 WL 2268378 (M.D. Pa. Aug. 6, 2026) (Judge Julia K. Munley). Kelly Birmelin is the widow of Michael Birmelin, a former Verizon employee who died in 2023. As his surviving spouse, Birmelin claims she is entitled to survivor pension benefits under the Mid-Atlantic Plan of the Verizon Pension Plan for Associates. The plan informed her that she qualified for only 65% of the available survivor annuity, but Birmelin contends that her husband’s accumulated vacation and sick time should have been credited toward his years of service, and that doing so would result in 100% of the available benefit. Birmelin filed this action in state court, asserting two counts: a declaratory judgment claim seeking recalculation of her husband’s employment time and a declaration that she is owed 100% of benefits, and a breach of contract claim alleging the plan violated the pension plan’s terms. What happened next is disputed. Birmelin says she served the complaint on the plan by certified mail to a post office box, that the plan never answered, and the state court entered a default judgment in her favor. The plan says it was never properly served, filed a state-court petition to open or strike the default, and removed the case to federal court before that petition was decided. The plan then filed a motion to dismiss for failure to state a claim based on ERISA preemption and failure to exhaust administrative remedies. Last year the court agreed that Birmelin’s claims were preempted, but ruled that it could not adjudicate the motion to dismiss until the state court default issue had been cleared up. (Your ERISA Watch covered this ruling in our September 24, 2025 edition.) The plan thus followed up with a motion to strike or vacate the default judgment, which placed two motions on the court’s plate. Addressing default first, the court first rejected the plan’s argument that the judgment was void for lack of service under Federal Rule of Civil Procedure 60(b)(4). The plan argued that Birmelin served it at the wrong address, but the court ruled that Birmelin had properly served the plan at the address listed in the summary plan description (SPD) for the plan administrator. The court was unimpressed by the plan’s attempt to recast the address as merely a “service center” distinct from the plan administrator: “Arguments caked in administrative sludge are not persuasive.” However, Birmelin’s victory on the service issue did not win the day. The court noted that the Third Circuit “does not favor entry of defaults or default judgments” and resolves doubtful cases in favor of deciding them on the merits. The court applied the Third Circuit’s four-factor test for excusable neglect under Rule 60(b)(1) – prejudice to the plaintiff, a meritorious defense, culpability, and the availability of alternative sanctions – and found in favor of the plan on each factor. First, Birmelin showed only delay, not lost evidence or impaired proof. Second, the plan’s preemption and exhaustion defenses were meritorious. Third, routing mail through a third-party vendor’s courier reflected carelessness rather than bad faith. Fourth, an “admonishment” to the plan for its confusing SPD language was an adequate alternative to default. Turning to the motion to dismiss, the court quickly reaffirmed that Birmelin’s state law claims were preempted by ERISA and therefore must be dismissed. It granted Birmelin leave to replead claims arising under ERISA. Furthermore, because the parties agreed Birmelin had not exhausted the plan’s claim and appeal procedures, the court stayed and administratively closed the case to allow for those procedures, ordering the parties to give periodic status reports.

Sixth Circuit

Tascarella v. Aptiv US Gen. Servs. Partnership, No. 26-3101, __ F. App’x __, 2026 WL 2243787 (6th Cir. Aug. 4, 2026) (Before Circuit Judges Batchelder, Moore, and Thapar). Aptiv Corporation offered Daniel Tascarella the position of plant manager of an Ohio manufacturing facility beginning in September of 2025. Tascarella “was particularly attracted to Aptiv’s ostensibly immediate vesting of employment benefits,” and began work. However, within a couple of days Tascarella began experiencing severe medical symptoms, including dizziness, temporary loss of consciousness, and drops in blood pressure. He was subsequently diagnosed with liver cirrhosis, portal hypertension, hepatic encephalopathy, and stage-four liver failure, with his doctor recommending a liver-transplant listing. Tascarella was approved for disability benefits and informed Aptiv he would need an indefinite leave extension. In response, Aptiv terminated Tascarella, citing “the ‘critical’ nature of the plant-manager position and the ‘undue burden’ of leaving that position vacant for an indefinite, months-long period.” Aptiv also offered a severance package that Tascarella considered insufficient. Tascarella thus sued Aptiv in state court asserting ERISA interference and various claims under state law, and moved for a temporary restraining order (TRO) and a preliminary injunction. The state court issued an ex parte TRO before Aptiv was able to remove the case to federal court. After a hearing, the district court denied Tascarella’s motion for a preliminary injunction, so Tascarella appealed. (Your ERISA Watch covered this ruling in our February 11, 2026 edition.) At the outset, the Sixth Circuit acknowledged that the district court erred by requiring Tascarella to prove his entitlement to an injunction by “clear and convincing evidence.” However, the appellate court noted that it could affirm on any ground supported by the record, and thus this legal error did not require reversal because Tascarella still failed to show irreparable harm under the correct standard. The court explained that “the irreparable-harm factor is ‘indispensable,’” and even a strong showing on the other relevant factors “will not overcome a lack of irreparable harm because ‘[i]f the plaintiff isn’t facing imminent and irreparable injury, there’s no need to grant relief now as opposed to at the end of the lawsuit.’” The court stated that losing employment, salary, disability benefits, life insurance, and retirement benefits are “quintessentially reparable by money damages,” and a delay in receiving compensation is not, by itself, irreparable harm. There was “no indication from the record that Aptiv would not be able to reinstate or compensate Tascarella should he prevail on the merits of his claims.” Tascarella argued that an injunction was required because he might lose the ability to reinstate his long-term disability and life insurance coverage, but the court found this speculative, and, in any event, these harms were fully compensable through money damages. Tascarella also argued that he “faces significant medical bills and an inability to obtain other income and benefits, both due to his liver condition,” thus warranting an injunction. However, the Sixth Circuit noted that the district court found that Tascarella was eligible for Medicare, Social Security benefits, and COBRA continuation coverage, and that he “‘has not pled a financial barrier to [his] obtaining [the] coverage’ or healthcare that he needs.” Tascarella could not rely on his wife’s needs either, because she too was eligible for COBRA continuation and had since become Medicare-eligible. Thus, “Tascarella’s assertion of ‘great undue hardship’ and a ‘great risk of being unable to obtain needed medical treatment’ is unavailing here, too.” As a result, the Sixth Circuit affirmed the ruling below, and Tascarella’s case will have to proceed without any interim relief.

Provider Claims

Ninth Circuit

Wagoner v. Local 428 Trustees of the Operating Engineers Health & Welfare Trust Fund, No. CV-26-03543-PHX-KML, 2026 WL 2247857 (D. Ariz. Aug. 4, 2026) (Judge Krissa M. Lanham). In our second Gary Wagoner case of the week (see above under “Attorneys’ Fees”) – curiously issued on the very same day as our first one – Wagoner provided medical services in 2019 and 2020 to a participant in the Local 428 Trustees of the Operating Engineers Health and Welfare Trust Fund, a self-funded multi-employer ERISA welfare benefit plan. Wagoner submitted claims to the Fund totaling $378,971.62 but the fund allegedly systematically denied or underpaid those claims. Wagoner filed suit in Arizona state court, asserting state law claims and, in the alternative, ERISA claims under § 502(a)(1)(B) (for plan benefits) and § 502(a)(3) (for equitable relief). Wagoner applied for entry of default in state court, but the Fund subsequently removed the case to federal court and then filed a motion to dismiss. The Fund argued that Wagoner’s state law claims were preempted by ERISA, that the governing plan’s anti-assignment clause barred Wagoner from pursuing any ERISA claims, and that the claims were untimely. Wagoner opposed, first arguing that the state court default entry barred the motion, and alternatively addressing the merits. The court addressed the default issue first, finding no evidence that default had actually been entered in state court before removal, and even if it had been entered, “any delay in appearing was brief, the Fund has now appeared, and the Fund has meritorious defenses.” Thus, the court ruled that any purported default was vacated. On the merits, the court noted that Wagoner had filed numerous similar suits in recent years, several of which had resulted in rulings that his state law claims were preempted by ERISA. “Despite this case raising the same type of claims, Wagoner does not address the governing law nor identify any way in which his state-law claims might avoid preemption.” Indeed, the court noted that Wagoner effectively conceded that both sets of his claims arose from the same underlying facts by alleging ERISA claims in the alternative. The court thus found Wagoner’s state law claims to be preempted. As for Wagoner’s claims under ERISA, the court noted that he was bringing them as an assignee and not on his own behalf. However, the plan at issue contained an anti-assignment clause. The court stated that anti-assignment clauses in ERISA plans are valid and enforceable, and considered the plan documents as incorporated by reference into the complaint. (The court rejected Wagoner’s attempt to dispute the authenticity of the plan because the document he submitted contained the same relevant language as the document offered by the Fund.) Examining that language, the court found that while the plan permitted a participant to “request” that benefit payments be directed to a provider, this did not constitute an assignment because the plan specifically stated that “coverage and your rights to receive any benefits under this Plan may not be assigned.” Furthermore, directing payment to a provider “is not an assignment of any right under this Plan or under ERISA…and is not an assignment of any legal or equitable right to institute any court proceeding.” As a result, the anti-assignment provision was enforceable and prevented Wagoner from bringing his ERISA claims. The court granted the Fund’s motion in full and directed judgment in the Fund’s favor.

Retaliation Claims

Sixth Circuit

Hoxworth v. Erard, No. 1:26-CV-626, 2026 WL 2274159 (W.D. Mich. Aug. 7, 2026) (Judge Hala Y. Jarbou). Jeffrey Hoxworth worked for SDI Consulting, LLC for more than 20 years, was a member of SDI, owned one-third interest in the company, and participated in the company’s 401(k) plan. Hoxworth alleges that SDI withheld money from his wages for his 401(k) contributions but failed to transfer those funds to the plan. In early 2026 he sent SDI a letter raising 401(k) and pay issues and informed SDI that he was resigning effective April 11, 2026. Hoxworth alleges SDI placed him on administrative leave the very next day and terminated him a week later, citing performance problems it had never previously raised. Hoxworth sued SDI, along with JAE Consulting LLC (a fellow member of SDI) and Jeremy Erard (JAE’s owner and SDI’s managing member), asserting ERISA claims for the unremitted 401(k) contributions and for retaliation, in addition to claims under the Fair Labor Standards Act and state law. Erard and JAE were parties to an Operating Agreement, which was executed alongside Hoxworth’s 2018 buyout of Hoxworth’s SDI ownership stake, that required arbitration of disputes among SDI’s members. Defendants jointly moved to compel arbitration of all of Hoxworth’s claims, and alternatively moved to dismiss the ERISA claims for lack of Article III standing and the ERISA retaliation claim for failure to state a claim. The court first addressed standing. Defendants argued that Hoxworth’s 401(k) claim had had already been resolved by a prior Department of Labor consent order against SDI and Erard covering the same conduct. The court disagreed, stating that the record did not indicate that the DOL settlement was coextensive with Hoxworth’s claimed damages or that his losses had been fully redressed. Any risk of a double recovery, the court held, was a merits issue to be addressed later, not a basis to find lack of standing. Turning to arbitrability, the court found that the Operating Agreement’s arbitration clause governed the ERISA claims against JAE and Erard, regardless of forum selections clauses in Hoxworth’s separate Employment and Redemption Agreements, because all three contracts were executed as one interrelated transaction and had to be read together. JAE, as an actual signatory, could compel arbitration outright. Erard, though not a signatory, could enforce the clause under Michigan agency-law principles because he had signed the Operating Agreement as JAE’s agent. However, the court changed course regarding SDI, ruling that it could not invoke the arbitration clause because the Operating Agreement expressly disclaimed third-party beneficiaries, and SDI was not JAE’s agent. The court also held that it was required to resolve the issue of whether non-signatories could enforce the arbitration agreement, instead of an arbitrator, under the Supreme Court’s 2024 decision in Coinbase, Inc. v. Suski. (The court even concluded that this decision “implicitly overruled” a Sixth Circuit decision to the contrary.) Thus, in the end Hoxworth will have to arbitrate his claims against JAE and Erard, but his claims against SDI remained in federal court. The court stayed the non-arbitrable claims pending arbitration, however, because they were “inherently inseparable” from the arbitrable claims. As for the merits of Hoxworth’s ERISA retaliation claim, the court held Hoxworth adequately alleged that SDI fired him because he complained about his 401(k) contributions. Termination two months before his planned resignation date was an adverse action, and the one-day gap between his complaint letter and his administrative leave, followed by termination a week later, was close enough in time to support an inference of retaliatory causation. The court found this reinforced by SDI’s reliance on performance problems it had never previously raised. Defendants’ motion to dismiss the retaliation claim was thus denied.

Seventh Circuit

Tallon v. United Airlines, Inc., No. 25 C 7529, 2026 WL 2294706 (N.D. Ill. Aug. 10, 2026) (Judge Jorge L. Alonso). Michael Tallon, a United Airlines pilot, alleges that in 2023 he suffered a head injury when he tripped during a layover in the Azores. Tallon further alleges that when he raised the issue with United and his union, the Air Line Pilots Association (ALPA), they directed him into the Human Intervention Motivation Study (HIMS) program, a substance-abuse treatment and monitoring track developed by the Federal Aviation Administration. They did not arrange for any care for his head injury. Instead, ALPA’s HIMS representative told Tallon that “if he did not confess to a drinking problem, he would never fly for United again.” Tallon denied having a drinking problem but enrolled in HIMS under “coercion and duress,” worried that he might suffer “loss of benefits…or termination.” Tallon alleges that over the following two years, he underwent repeated evaluations that increasingly indicated he did not have alcohol dependence, yet United continued to require additional testing which he ultimately refused. He was removed from HIMS, issued a noncompliance charge, and eventually terminated in 2025. He now brings this action against United, ALPA, and two examining physicians, alleging claims including disability discrimination and retaliation, Rehabilitation Act violations, civil RICO claims, and state-law fraud and tortious interference claims. Most relevant to us, Count IV alleges that United and ALPA violated ERISA § 510, 29 U.S.C. § 1140, which makes it unlawful to discharge or discriminate against a plan participant “for the purpose of interfering with the attainment of any right to which such participant may become entitled under the plan.” Tallon’s theory was that by pressuring him into the HIMS program, defendants interfered with his long-term disability (LTD) benefit rights under United’s collective bargaining agreement with ALPA. This was because participation in the HIMS program, which acts as a form of disability coverage, “puts this bargained-for LTD benefit at risk.” All four defendants moved to dismiss. On the ERISA count, United and ALPA argued that the claim was precluded by the Railway Labor Act (RLA), which governs airline-industry collective bargaining agreements, and, alternatively, that Tallon failed to plausibly allege the required causal connection between his benefits and his termination. The court agreed on both grounds and dismissed the ERISA claim. First, applying the RLA’s “minor dispute” doctrine, which gives the RLA precedence in “controversies over the meaning of an existing collective bargaining agreement in a particular fact situation,” the court explained that Tallon’s claim must be arbitrated under the RLA because it involved interference with a bargained-for benefit. Independent of preclusion, the court held the claim implausible on the merits. Tallon’s own allegations showed that he applied for and received full LTD benefits, including back pay, for his head injury, and was only terminated afterward when he failed to complete the HIMS program’s required testing. As a result, “it is not plausible that his termination was motivated by his receipt of ERISA benefits.” The court granted defendants’ motion to dismiss Tallon’s other federal claims as well for a variety of reasons. It also declined to exercise supplemental jurisdiction over his state law counts, although it identified several issues with them “in hopes of heading off issues that might recur if Plaintiff files a second amended complaint.” The dismissal was without prejudice.

Statute of Limitations

Third Circuit

Fernandez v. Famiglio, No. 26-CV-0105, 2026 WL 2227138 (E.D. Pa. July 31, 2026) (Judge Chad F. Kenney). Sacha Fernandez alleges in this pro se action that she was employed by Peter Famiglio from 2014 to 2020, during which time she participated in an ERISA-governed 401(k) retirement plan. She alleges that she discovered company misconduct, and after her employment ended, Famiglio’s brother, an attorney, threatened to sue her and withhold her 401(k) funds if she spoke up. Fernandez filed this action; one of her claims was for statutory penalties for failure to provide plan documents under ERISA, 29 U.S.C. §§ 1024, 1132(c). Famiglio filed a motion to dismiss, which was granted in May of this year. The court specifically ruled that Fernandez’s statutory penalty claim was time-barred because her claim accrued by 2020 at the latest, but she did not file this action until 2026. (See our June 3, 2026 edition for more details about this decision.) Now, Fernandez has moved for reconsideration of that order. She submitted fifteen exhibits and a proposed second amended complaint with more detailed factual allegations regarding her document requests. The court emphasized that “[a] motion for reconsideration is an ‘extremely limited’ remedy, which courts grant ‘only to correct manifest errors of law or fact or to present newly discovered evidence.’” Fernandez did not qualify for relief under this standard. The court stated that although ten of the fifteen exhibits attached to the SAC were new to the record, they were available to Fernandez when she filed her initial complaint and thus did not qualify as “newly discovered” evidence justifying reconsideration. Moreover, the court had already accepted Fernandez’s factual allegations as true, and thus the additional details “do not change the outcome.” Fernandez also identified no intervening change in controlling law. The court then revisited the legal issue and determined once again that Fernandez’s claim was time-barred. The court explained that her claim was governed by Pennsylvania’s analogous two-year statute of limitations for civil penalty and forfeiture actions. Because she submitted her request for plan documents on July 24, 2020, defendant’s response was due by the end of August 2020 and her claim accrued then. She thus had until August of 2022 to file suit, but she waited until 2026. Fernandez argued that her “inability to access the governing Plan documents impaired her ability to understand the procedures applicable to her retirement-plan claims, including where such claims should be brought.” However, the court stated, “This is not an extraordinary circumstance.” The court held that “Defendant’s failure to furnish the requested information within the thirty-day deadline should have been sufficient to alert Plaintiff that she had an actionable claim.” Fernandez also argued that her originally filed complaint in state court should have tolled her deadline, but this argument did not work either: “[E]ven if the state action did toll the statute of limitations, reconsideration must still be denied because Plaintiff’s initial state court action was itself untimely… Plaintiff did not file her state court action until December 15, 2023, over a year after the statute of limitations had run.” Fernandez’s motion for reconsideration was thus denied.

Withdrawal Liability & Unpaid Contributions

Ninth Circuit

City of Tacoma v. Western Metal Industry Pension Fund, No. 25-4055, __ F. App’x __, 2026 WL 2295813 (9th Cir. Aug. 10, 2026) (Before Circuit Judges McKeown, N.R. Smith, and Christen). Western Metal Industry Pension Fund is a multiemployer pension plan governed by ERISA. The City of Tacoma was a contributing employer to the plan under a series of collective-bargaining agreements, but it withdrew from the plan after its obligations under those agreements ended. The parties disagreed regarding how much withdrawal liability Tacoma owed, so the parties took the dispute to arbitration. The arbitrator ruled that the plan’s actuary erred by calculating Tacoma’s withdrawal liability using interest-rate assumptions published by the Pension Benefit Guaranty Corporation (PBGC) rather than a rate that reflected the “best estimate of anticipated experience under the plan,” as required by 29 U.S.C. § 1393(a)(1). The arbitrator ordered the plan to recalculate Tacoma’s liability using a 7% interest rate instead, the same rate the plan used to calculate minimum-funding contributions for participating employers. The district court confirmed the award and the plan appealed to the Ninth Circuit, which affirmed in this unpublished memorandum disposition, ruling that the district court “simply followed controlling precedent… Because the PBGC rates were not based on the Plan’s assets and did not account for any future experience of the Plan, the actuary’s use of those rates was improper.” The Ninth Circuit also rejected the plan’s challenge to the 7% interest rate. It emphasized the deference owed to the arbitrator’s factual findings under 29 U.S.C. § 1401(c), which directs courts to presume an arbitrator’s findings of fact are correct unless rebutted “by a clear preponderance of the evidence.” The plan’s actuary testified in her deposition that the 7% rate was “based on expected returns of the assets of the [P]lan,” and the arbitrator found that this rate “best reflect[ed] the anticipated experience under the [P]lan.” The plan did not sufficiently rebut the presumption that these conclusions were correct. The court noted that in a previous case (GCIU-Employer Retirement Fund v. MNG Enterprises, Inc.) it had similarly upheld an arbitral award ordering recalculation of withdrawal liability using a plan’s own minimum-funding interest rate, which supported the result here. Finally, the panel denied Tacoma’s request for appellate attorney’s fees and costs under 29 U.S.C. § 1451(e), which gives courts discretion to award fees to a prevailing party in multiemployer plan litigation. Applying the court’s five-factor test from Cuyamaca Meats, the panel found that two factors cut against an award: the plan’s ability to pay the fees, and the fact that an award would not particularly benefit the plan’s participants. The panel also concluded, “Our decision today will provide sufficient deterrent value.” Thus, the court affirmed the judgment in Tacoma’s favor, but exercised its discretion to deny the city’s fee request.