(Slip Opinion) OCTOBER TERM, 2007 1
Syllabus
NOTE: Where it is feasible, a syllabus (headnote) will be released, as is
being done in connection with this case, at the time the opinion is issued.
The syllabus constitutes no part of the opinion of the Court but has been
prepared by the Reporter of Decisions for the convenience of the reader.
See United States v. Detroit Timber & Lumber Co., 200 U. S. 321, 337.
SUPREME COURT OF THE UNITED STATES
Syllabus
LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.,
ET AL.
CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE FOURTH CIRCUIT
No. 06–856. Argued November 26, 2007—Decided February 20, 2008
Petitioner, a participant in a defined contribution pension plan, alleged
that the plan administrator’s failure to follow petitioner’s investment
directions “depleted” his interest in the plan by approximately
$150,000 and amounted to a breach of fiduciary duty under the Em
ployee Retirement Income Security Act of 1974 (ERISA). The District
Court granted respondents judgment on the pleadings, and the
Fourth Circuit affirmed. Relying on Massachusetts Mutual Life Ins.
Co. v. Russell, 473 U. S. 134, the Circuit held that ERISA §502(a)(2)
provides remedies only for entire plans, not for individuals.
Held: Although §502(a)(2) does not provide a remedy for individual in
juries distinct from plan injuries, it does authorize recovery for fidu
ciary breaches that impair the value of plan assets in a participant’s
individual account. Section 502(a)(2) provides for suits to enforce the
liability-creating provisions of §409, concerning breaches of fiduciary
duties that harm plans. The principal statutory duties imposed by
§409 relate to the proper management, administration, and invest
ment of plan assets, with an eye toward ensuring that the benefits
authorized by the plan are ultimately paid to plan participants. The
misconduct that petitioner alleges falls squarely within that category,
unlike the misconduct in Russell. There, the plaintiff received all of
the benefits to which she was contractually entitled, but sought con
sequential damages arising from a delay in the processing of her
claim. Russell’s emphasis on protecting the “entire plan” reflects the
fact that the disability plan in Russell, as well as the typical pension
plan at that time, promised participants a fixed benefit. Misconduct
by such a plan’s administrators will not affect an individual’s enti
tlement to a defined benefit unless it creates or enhances the risk of
2 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
Syllabus
default by the entire plan. For defined contribution plans, however,
fiduciary misconduct need not threaten the entire plan’s solvency to
reduce benefits below the amount that participants would otherwise
receive. Whether a fiduciary breach diminishes plan assets payable
to all participants or only to particular individuals, it creates the kind
of harms that concerned §409’s draftsmen. Thus, Russell’s “entire
plan” references, which accurately reflect §409’s operation in the de
fined benefit context, are beside the point in the defined contribution
context. Pp. 4–8.
450 F. 3d 570, vacated and remanded.
STEVENS, J., delivered the opinion of the Court, in which SOUTER,
GINSBURG, BREYER, and ALITO, JJ., joined. ROBERTS, C. J., filed an opin
ion concurring in part and concurring in the judgment, in which KEN
NEDY, J., joined. THOMAS, J., filed an opinion concurring in the judg
ment, in which SCALIA, J., joined.
Cite as: 552 U. S. ____ (2008) 1
Opinion of the Court
NOTICE: This opinion is subject to formal revision before publication in the
preliminary print of the United States Reports. Readers are requested to
notify the Reporter of Decisions, Supreme Court of the United States, Wash
ington, D. C. 20543, of any typographical or other formal errors, in order
that corrections may be made before the preliminary print goes to press.
SUPREME COURT OF THE UNITED STATES
_________________
No. 06–856
_________________
JAMES LARUE, PETITIONER v. DEWOLFF, BOBERG
& ASSOCIATES, INC., ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FOURTH CIRCUIT
[February 20, 2008]
JUSTICE STEVENS delivered the opinion of the Court.
In Massachusetts Mut. Life Ins. Co. v. Russell, 473 U. S.
134 (1985), we held that a participant in a disability plan
that paid a fixed level of benefits could not bring suit
under §502(a)(2) of the Employee Retirement Income
Security Act of 1974 (ERISA), 88 Stat. 891, 29 U. S. C.
§1132(a)(2), to recover consequential damages arising from
delay in the processing of her claim. In this case we con
sider whether that statutory provision authorizes a par
ticipant in a defined contribution pension plan to sue a
fiduciary whose alleged misconduct impaired the value of
plan assets in the participant’s individual account.1 Rely
ing on our decision in Russell, the Court of Appeals for the
——————
1 As its names imply, a “defined contribution plan” or “individual
account plan” promises the participant the value of an individual
account at retirement, which is largely a function of the amounts
contributed to that account and the investment performance of those
contributions. A “defined benefit plan,” by contrast, generally promises
the participant a fixed level of retirement income, which is typically
based on the employee’s years of service and compensation. See
§§3(34)–(35), 29 U. S. C. §§1002(34)–(35); P. Schneider & B. Freedman,
ERISA: A Comprehensive Guide §3.02 (2d ed. 2003).
2 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
Opinion of the Court
Fourth Circuit held that §502(a)(2) “provides remedies
only for entire plans, not for individuals. . . . Recovery
under this subsection must ‘inure[ ] to the benefit of the
plan as a whole,’ not to particular persons with rights
under the plan.” 450 F. 3d 570, 572–573 (2006) (quoting
Russell, 473 U. S., at 140). While language in our Russell
opinion is consistent with that conclusion, the rationale for
Russell’s holding supports the opposite result in this case.
I
Petitioner filed this action in 2004 against his former
employer, DeWolff, Boberg & Associates (DeWolff), and
the ERISA-regulated 401(k) retirement savings plan
administered by DeWolff (Plan). The Plan permits par
ticipants to direct the investment of their contributions in
accordance with specified procedures and requirements.
Petitioner alleged that in 2001 and 2002 he directed De-
Wolff to make certain changes to the investments in his
individual account, but DeWolff never carried out these
directions. Petitioner claimed that this omission “de
pleted” his interest in the Plan by approximately
$150,000, and amounted to a breach of fiduciary duty
under ERISA. The complaint sought “ ‘make-whole’ or
other equitable relief as allowed by [§502(a)(3)],” as well as
“such other and further relief as the court deems just and
proper.” Civil Action No. 2:04–1747–18 (D. S. C.), p. 4, 2
Record, Doc. 1.
Respondents filed a motion for judgment on the plead
ings, arguing that the complaint was essentially a claim
for monetary relief that is not recoverable under
§502(a)(3). Petitioner countered that he “d[id] not wish for
the court to award him any money, but . . . simply
want[ed] the plan to properly reflect that which would be
his interest in the plan, but for the breach of fiduciary
duty.” Reply to Defendants Motion to Dismiss, p. 7, 3 id.,
Doc. 17. The District Court concluded, however, that since
Cite as: 552 U. S. ____ (2008) 3
Opinion of the Court
respondents did not possess any disputed funds that
rightly belonged to petitioner, he was seeking damages
rather than equitable relief available under §502(a)(3).
Assuming, arguendo, that respondents had beached a
fiduciary duty, the District Court nonetheless granted
their motion.
On appeal petitioner argued that he had a cognizable
claim for relief under §§502(a)(2) and 502(a)(3) of ERISA.
The Court of Appeals stated that petitioner had raised his
§502(a)(2) argument for the first time on appeal, but nev
ertheless rejected it on the merits.
Section 502(a)(2) provides for suits to enforce the liabil
ity-creating provisions of §409, concerning breaches of
fiduciary duties that harm plans.2 The Court of Appeals
cited language from our opinion in Russell suggesting that
that these provisions “protect the entire plan, rather than
the rights of an individual beneficiary.” 473 U. S., at 142.
It then characterized the remedy sought by petitioner as
“personal” because he “desires recovery to be paid into his
plan account, an instrument that exists specifically for his
benefit,” and concluded:
“We are therefore skeptical that plaintiff’s individ
ual remedial interest can serve as a legitimate proxy
for the plan in its entirety, as [§502(a)(2)] requires.
To be sure, the recovery plaintiff seeks could be seen
——————
2 Section 409(a) provides:
“Any person who is a fiduciary with respect to a plan who breaches
any of the responsibilities, obligations, or duties imposed upon fiduciar
ies by this title shall be personally liable to make good to such plan any
losses to the plan resulting from each such breach, and to restore to
such plan any profits of such fiduciary which have been made through
use of assets of the plan by the fiduciary, and shall be subject to such
other equitable or remedial relief as the court may deem appropriate,
including removal of such fiduciary. A fiduciary may also be removed
for a violation of section 411 of this Act.” 88 Stat. 886, 29 U. S. C.
§1109(a).
4 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
Opinion of the Court
as accruing to the plan in the narrow sense that it
would be paid into plaintiff’s plan account, which is
part of the plan. But such a view finds no license in
the statutory text, and threatens to undermine the
careful limitations Congress has placed on the scope
of ERISA relief.” 450 F. 3d, at 574.
The Court of Appeals also rejected petitioner’s argument
that the make-whole relief he sought was “equitable”
within the meaning of §502(a)(3). Although our grant of
certiorari, 551 U. S. ___ (2007), encompassed the
§502(a)(3) issue, we do not address it because we conclude
that the Court of Appeals misread §502(a)(2).
II
As the case comes to us we must assume that respon
dents breached fiduciary obligations defined in §409(a),
and that those breaches had an adverse impact on the
value of the plan assets in petitioner’s individual account.
Whether petitioner can prove those allegations and
whether respondents may have valid defenses to the claim
are matters not before us.3 Although the record does not
reveal the relative size of petitioner’s account, the legal
issue under §502(a)(2) is the same whether his account
includes 1% or 99% of the total assets in the plan.
As we explained in Russell, and in more detail in our
later opinion in Varity Corp. v. Howe, 516 U. S. 489, 508–
512 (1996), §502(a) of ERISA identifies six types of civil
actions that may be brought by various parties. The
second, which is at issue in this case, authorizes the Secre
tary of Labor as well as plan participants, beneficiaries,
and fiduciaries, to bring actions on behalf of a plan to
——————
3 For example, we do not decide whether petitioner made the alleged
investment directions in accordance with the requirements specified by
the Plan, whether he was required to exhaust remedies set forth in the
Plan before seeking relief in federal court pursuant to §502(a)(2), or
whether he asserted his rights in a timely fashion.
Cite as: 552 U. S. ____ (2008) 5
Opinion of the Court
recover for violations of the obligations defined in §409(a).
The principal statutory duties imposed on fiduciaries by
that section “relate to the proper management, admini
stration, and investment of fund assets,” with an eye
toward ensuring that “the benefits authorized by the plan”
are ultimately paid to participants and beneficiaries.
Russell, 473 U. S., at 142; see also Varity, 516 U. S., at
511–512 (noting that §409’s fiduciary obligations “relat[e]
to the plan’s financial integrity” and “reflec[t] a special
congressional concern about plan asset management”).
The misconduct alleged by the petitioner in this case falls
squarely within that category.4
The misconduct alleged in Russell, by contrast, fell
outside this category. The plaintiff in Russell received all
of the benefits to which she was contractually entitled, but
sought consequential damages arising from a delay in the
processing of her claim. 473 U. S., at 136–137. In holding
that §502(a)(2) does not provide a remedy for this type of
injury, we stressed that the text of §409(a) characterizes
the relevant fiduciary relationship as one “with respect to
a plan,” and repeatedly identifies the “plan” as the victim
of any fiduciary breach and the recipient of any relief. See
id., at 140. The legislative history likewise revealed that
“the crucible of congressional concern was misuse and
——————
4 The record does not reveal whether the alleged $150,000 injury
represents a decline in the value of assets that DeWolff should have
sold or an increase in the value of assets that DeWolff should have
purchased. Contrary to respondents’ argument, however, §502(a)(2)
encompasses appropriate claims for “lost profits.” See Brief for Re
spondents 12–13. Under the common law of trusts, which informs our
interpretation of ERISA’s fiduciary duties, see Varity, 516 U. S., at
496–497, trustees are “chargeable with . . . any profit which would have
accrued to the trust estate if there had been no breach of trust,” includ
ing profits forgone because the trustee “fails to purchase specific
property which it is his duty to purchase.” 1 Restatement (Second)
Trusts §205, and Comment i, §211 (1957); see also 3 A. Scott, Law on
Trusts §§205, 211 (3d ed. 1967).
6 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
Opinion of the Court
mismanagement of plan assets by plan administrators.”
Id., at 141, n. 8. Finally, our review of ERISA as a whole
confirmed that §§502(a)(2) and 409 protect “the financial
integrity of the plan,” id., at 142, n. 9, whereas other
provisions specifically address claims for benefits. See id.,
at 143–144 (discussing §§502(a)(1)(B) and 503). We there
fore concluded:
“A fair contextual reading of the statute makes it
abundantly clear that its draftsmen were primarily
concerned with the possible misuse of plan assets, and
with remedies that would protect the entire plan,
rather than with the rights of an individual benefici
ary.” Id., at 142.
Russell’s emphasis on protecting the “entire plan” from
fiduciary misconduct reflects the former landscape of
employee benefit plans. That landscape has changed.
Defined contribution plans dominate the retirement
plan scene today.5 In contrast, when ERISA was enacted,
and when Russell was decided, “the [defined benefit] plan
was the norm of American pension practice.” J. Langbein,
S. Stabile, & B. Wolk, Pension and Employee Benefit Law
58 (4th ed. 2006); see also Zelinsky, The Defined Contribu
tion Paradigm, 114 Yale L. J. 451, 471 (2004) (discussing
the “significant reversal of historic patterns under which
the traditional defined benefit plan was the dominant
paradigm for the provision of retirement income”). Unlike
the defined contribution plan in this case, the disability
plan at issue in Russell did not have individual accounts;
——————
5 See, e.g., D. Rajnes, An Evolving Pension System: Trends in Defined
Benefit and Defined Contribution Plans, Employee Benefit Research
Institute (EBRI) Issue Brief No. 249 (Sept. 2002), http://www.ebri.org/
pdf/briefspdf/0902ib.pdf (all Internet materials as visited Jan. 28, 2008,
and available in Clerk of Court’s case file); Facts from EBRI: Retire
ment Trends in the United States Over the Past Quarter-Century
(June 2007), http://www.ebri.org/pdf/publications/facts/0607fact.pdf.
Cite as: 552 U. S. ____ (2008) 7
Opinion of the Court
it paid a fixed benefit based on a percentage of the em
ployee’s salary. See Russell v. Massachusetts Mut. Life
Ins. Co., 722 F. 2d 482, 486 (CA9 1983).
The “entire plan” language in Russell speaks to the
impact of §409 on plans that pay defined benefits. Mis
conduct by the administrators of a defined benefit plan
will not affect an individual’s entitlement to a defined
benefit unless it creates or enhances the risk of default by
the entire plan. It was that default risk that prompted
Congress to require defined benefit plans (but not defined
contribution plans) to satisfy complex minimum funding
requirements, and to make premium payments to the
Pension Benefit Guaranty Corporation for plan termina
tion insurance. See Zelinsky, 114 Yale L. J., at 475–478.
For defined contribution plans, however, fiduciary mis
conduct need not threaten the solvency of the entire plan
to reduce benefits below the amount that participants
would otherwise receive. Whether a fiduciary breach
diminishes plan assets payable to all participants and
beneficiaries, or only to persons tied to particular individ
ual accounts, it creates the kind of harms that concerned
the draftsmen of §409. Consequently, our references to
the “entire plan” in Russell, which accurately reflect the
operation of §409 in the defined benefit context, are beside
the point in the defined contribution context.
Other sections of ERISA confirm that the “entire plan”
language from Russell, which appears nowhere in §409 or
§502(a)(2), does not apply to defined contribution plans.
Most significant is §404(c), which exempts fiduciaries from
liability for losses caused by participants’ exercise of con
trol over assets in their individual accounts. See also 29
CFR §2550.404c–1 (2007). This provision would serve no
real purpose if, as respondents argue, fiduciaries never
had any liability for losses in an individual account.
We therefore hold that although §502(a)(2) does not
provide a remedy for individual injuries distinct from
8 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
Opinion of the Court
plan injuries, that provision does authorize recovery for
fiduciary breaches that impair the value of plan assets
in a participant’s individual account. Accordingly, the
judgment of the Court of Appeals is vacated, and the
case is remanded for further proceedings consistent with
this opinion.6
It is so ordered.
——————
6 After
our grant of certiorari respondents filed a motion to dismiss
the writ, contending that the case is moot because petitioner is no
longer a participant in the Plan. While his withdrawal of funds from
the Plan may have relevance to the proceedings on remand, we denied
their motion because the case is not moot. A plan “participant,” as
defined by §3(7) of ERISA, 29 U. S. C. §1002(7), may include a former
employee with a colorable claim for benefits. See, e.g., Harzewski v.
Guidant Corp., 489 F. 3d 799 (CA7 2007).
Cite as: 552 U. S. ____ (2008) 1
Opinion of ROBERTS, C. J.
SUPREME COURT OF THE UNITED STATES
_________________
No. 06–856
_________________
JAMES LARUE, PETITIONER v. DEWOLFF, BOBERG
& ASSOCIATES, INC., ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FOURTH CIRCUIT
[February 20, 2008]
CHIEF JUSTICE ROBERTS, with whom JUSTICE KENNEDY
joins, concurring in part and concurring in the judgment.
In the decision below, the Fourth Circuit concluded that
the loss to LaRue’s individual plan account did not permit
him to “serve as a legitimate proxy for the plan in its
entirety,” thus barring him from relief under §502(a)(2) of
the Employee Retirement Income Security Act of 1974
(ERISA), 29 U. S. C. §1132(a)(2). 450 F. 3d 570, 574
(2006). The Court today rejects that reasoning. See ante,
at 4, 7–8. I agree with the Court that the Fourth Circuit’s
analysis was flawed, and join the Court’s opinion to that
extent.
The Court, however, goes on to conclude that §502(a)(2)
does authorize recovery in cases such as the present one.
See ante, at 7–8. It is not at all clear that this is true.
LaRue’s right to direct the investment of his contributions
was a right granted and governed by the plan. See ante,
at 2. In this action, he seeks the benefits that would
otherwise be due him if, as alleged, the plan carried out
his investment instruction. LaRue’s claim, therefore, is a
claim for benefits that turns on the application and inter
pretation of the plan terms, specifically those governing
investment options and how to exercise them.
It is at least arguable that a claim of this nature prop
erly lies only under §502(a)(1)(B) of ERISA. That provi
2 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
Opinion of ROBERTS, C. J.
sion allows a plan participant or beneficiary “to recover
benefits due to him under the terms of his plan, to enforce
his rights under the terms of the plan, or to clarify his
rights to future benefits under the terms of the plan.” 29
U. S. C. §1132(a)(1)(B). It is difficult to imagine a more
accurate description of LaRue’s claim. And in fact claim
ants have filed suit under §502(a)(1)(B) alleging similar
benefit denials in violation of plan terms. See, e.g., Hess v.
Reg-Ellen Machine Tool Corp., 423 F. 3d 653, 657 (CA7
2005) (allegation made under §502(a)(1)(B) that a plan
administrator wrongfully denied instruction to move
retirement funds from employer’s stock to a diversified
investment account).
If LaRue may bring his claim under §502(a)(1)(B), it is
not clear that he may do so under §502(a)(2) as well.
Section 502(a)(2) provides for “appropriate” relief. Con
struing the same term in a parallel ERISA provision, we
have held that relief is not “appropriate” under §502(a)(3)
if another provision, such as §502(a)(1)(B), offers an ade
quate remedy. See Varity Corp. v. Howe, 516 U. S. 489,
515 (1996). Applying the same rationale to an interpreta
tion of “appropriate” in §502(a)(2) would accord with our
usual preference for construing the “same terms [to] have
the same meaning in different sections of the same stat
ute,” Barnhill v. Johnson, 503 U. S. 393, 406 (1992), and
with the view that ERISA in particular is a “ ‘ comprehen
sive and reticulated statute’ ” with “carefully integrated
civil enforcement provisions,” Massachusetts Mut. Life Ins.
Co. v. Russell, 473 U. S. 134, 146 (1985) (quoting Nach
man Corp. v. Pension Benefit Guaranty Corporation, 446
U. S. 359, 361 (1980)). In a variety of contexts, some
Courts of Appeals have accordingly prevented plaintiffs
from recasting what are in essence plan-derived benefit
claims that should be brought under §502(a)(1)(B) as
claims for fiduciary breaches under §502(a)(2). See, e.g.,
Coyne & Delany Co. v. Blue Cross & Blue Shield of Va.,
Cite as: 552 U. S. ____ (2008) 3
Opinion of ROBERTS, C. J.
Inc., 102 F. 3d 712, 714 (CA4 1996). Other Courts of
Appeals have disagreed with this approach. See, e.g.,
Graden v. Conexant Systems Inc., 496 F. 3d 291, 301 (CA3
2007).
The significance of the distinction between a
§502(a)(1)(B) claim and one under §502(a)(2) is not merely
a matter of picking the right provision to cite in the com
plaint. Allowing a §502(a)(1)(B) action to be recast as one
under §502(a)(2) might permit plaintiffs to circumvent
safeguards for plan administrators that have developed
under §502(a)(1)(B). Among these safeguards is the re
quirement, recognized by almost all the Courts of Appeals,
see Fallick v. Nationwide Mut. Ins. Co., 162 F. 3d 410,
418, n. 4 (CA6 1998) (citing cases), that a participant
exhaust the administrative remedies mandated by ERISA
§503, 29 U. S. C. §1133, before filing suit under
§502(a)(1)(B).* Equally significant, this Court has held
that ERISA plans may grant administrators and fiduciar
ies discretion in determining benefit eligibility and the
meaning of plan terms, decisions that courts may review
only for an abuse of discretion. Firestone Tire & Rubber
Co. v. Bruch, 489 U. S. 101, 115 (1989).
These safeguards encourage employers and others to
undertake the voluntary step of providing medical and
retirement benefits to plan participants, see Aetna Health
Inc. v. Davila, 542 U. S. 200, 215 (2004), and have no
doubt engendered substantial reliance interests on the
part of plans and fiduciaries. Allowing what is really a
claim for benefits under a plan to be brought as a claim for
breach of fiduciary duty under §502(a)(2), rather than as a
claim for benefits due “under the terms of [the] plan,”
§502(a)(1)(B), may result in circumventing such plan
——————
* Sensibly, the Court leaves open the question whether exhaustion
may be required of a claimant who seeks recovery for a breach of
fiduciary duty under §502(a)(2). See ante, at 4, n. 3.
4 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
Opinion of ROBERTS, C. J.
terms.
I do not mean to suggest that these are settled ques
tions. They are not. Nor are we in a position to answer
them. LaRue did not rely on §502(a)(1)(B) as a source of
relief, and the courts below had no occasion to address the
argument, raised by an amicus in this Court, that the
availability of relief under §502(a)(1)(B) precludes LaRue’s
fiduciary breach claim. See Brief for ERISA Industry
Committee as Amicus Curiae 13–30. I simply highlight
the fact that the Court’s determination that the present
claim may be brought under §502(a)(2) is reached without
considering whether the possible availability of relief
under §502(a)(1)(B) alters that conclusion. See, e.g.,
United Parcel Service, Inc. v. Mitchell, 451 U. S. 56, 60, n.
2 (1981) (noting general reluctance to consider arguments
raised only by an amicus and not considered by the courts
below). In matters of statutory interpretation, where
principles of stare decisis have their greatest effect, it is
important that we not seem to decide more than we do. I
see nothing in today’s opinion precluding the lower courts
on remand, if they determine that the argument is prop
erly before them, from considering the contention that
LaRue’s claim may proceed only under §502(a)(1)(B). In
any event, other courts in other cases remain free to con
sider what we have not—what effect the availability of
relief under §502(a)(1)(B) may have on a plan participant’s
ability to proceed under §502(a)(2).
Cite as: 552 U. S. ____ (2008) 1
THOMAS, J., concurring in judgment
SUPREME COURT OF THE UNITED STATES
_________________
No. 06–856
_________________
JAMES LARUE, PETITIONER v. DEWOLFF, BOBERG
& ASSOCIATES, INC., ET AL.
ON WRIT OF CERTIORARI TO THE UNITED STATES COURT OF
APPEALS FOR THE FOURTH CIRCUIT
[February 20, 2008]
JUSTICE THOMAS, with whom JUSTICE SCALIA joins,
concurring in the judgment.
I agree with the Court that petitioner alleges a cogniza
ble claim under §502(a)(2) of the Employee Retirement
Income Security Act of 1974 (ERISA), 29 U. S. C.
§1132(a)(2), but it is ERISA’s text and not “the kind of
harms that concerned [ERISA’s] draftsmen” that compels
my decision. Ante, at 7. In Massachusetts Mut. Life Ins.
Co. v. Russell, 473 U. S. 134 (1985), the Court held that
§409 of ERISA, 29 U. S. C. §1109, read together with
§502(a)(2), authorizes recovery only by “the plan as an
entity,” 473 U. S., at 140, and does not permit individuals
to bring suit when they do not seek relief on behalf of the
plan, id., at 139–144. The majority accepts Russell’s
fundamental holding, but reins in the Court’s further
suggestion in Russell that suits under §502(a)(2) are
meant to “protect the entire plan,” rather than “the rights
of an individual beneficiary.” Ante, at 4–8; see Russell,
supra, at 142. The majority states that emphasizing the
“entire plan” was a sensible application of §§409 and
502(a)(2) in the historical context of defined benefit plans,
but that the subsequent proliferation of defined contribu
tion plans has rendered Russell’s dictum inapplicable to
most modern cases. Ante, at 6–7. In concluding that a
loss suffered by a participant’s defined contribution plan
2 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
THOMAS, J., concurring in judgment
account because of a fiduciary breach “creates the kind of
harms that concerned the draftsmen of §409,” the majority
holds that §502(a)(2) authorizes recovery for plan partici
pants such as petitioner. Ante, at 7–8.
Although I agree with the majority’s holding, I write
separately because my reading of §§409 and 502(a)(2) is
not contingent on trends in the pension plan market. Nor
does it depend on the ostensible “concerns” of ERISA’s
drafters. Rather, my conclusion that petitioner has stated
a cognizable claim flows from the unambiguous text of
§§409 and 502(a)(2) as applied to defined contribution
plans. Section 502(a)(2) states that “[a] civil action may be
brought” by a plan “participant, beneficiary or fiduciary,”
or by the Secretary of Labor, to obtain “appropriate relief”
under §409. 29 U. S. C. §1132(a)(2). Section 409(a) pro
vides that “[a]ny person who is a fiduciary with respect to
a plan . . . shall be personally liable to make good to such
plan any losses to the plan resulting from each [fiduciary]
breach, and to restore to such plan any profits of such
fiduciary which have been made through use of assets of
the plan by the fiduciary . . . .” 29 U. S. C. §1109(a) (em
phasis added).
The plain text of §409(a), which uses the term “plan”
five times, leaves no doubt that §502(a)(2) authorizes
recovery only for the plan. Likewise, Congress’ repeated
use of the word “any” in §409(a) clarifies that the key
factor is whether the alleged losses can be said to be losses
“to the plan,” not whether they are otherwise of a particu
lar nature or kind. See, e.g., Ali v. Federal Bureau of
Prisons, ante, at 4 (noting that the natural reading of
“any” is “one or some indiscriminately of whatever kind”
(internal quotation marks omitted)). On their face,
§§409(a) and 502(a)(2) permit recovery of all plan losses
caused by a fiduciary breach.
The question presented here, then, is whether the losses
to petitioner’s individual 401(k) account resulting from
Cite as: 552 U. S. ____ (2008) 3
THOMAS, J., concurring in judgment
respondents’ alleged breach of their fiduciary duties were
losses “to the plan.” In my view they were, because the
assets allocated to petitioner’s individual account were
plan assets. ERISA requires the assets of a defined con
tribution plan (including “gains and losses” and legal
recoveries) to be allocated for bookkeeping purposes to
individual accounts within the plan for the beneficial
interest of the participants, whose benefits in turn depend
on the allocated amounts. See 29 U. S. C. §1002(34) (de
fining a “defined contribution plan” as a “plan which pro
vides for an individual account for each participant and for
benefits based solely upon the amount contributed to the
participant’s account, and any income, expenses, gains
and losses, and any forfeitures of accounts of other par
ticipants which may be allocated to such participant’s
account”). Thus, when a defined contribution plan sus
tains losses, those losses are reflected in the balances in
the plan accounts of the affected participants, and a recov
ery of those losses would be allocated to one or more indi
vidual accounts.
The allocation of a plan’s assets to individual accounts
for bookkeeping purposes does not change the fact that all
the assets in the plan remain plan assets. A defined con
tribution plan is not merely a collection of unrelated ac
counts. Rather, ERISA requires a plan’s combined assets
to be held in trust and legally owned by the plan trustees.
See 29 U. S. C. §1103(a) (providing that “all assets of an
employee benefit plan shall be held in trust by one or more
trustees”). In short, the assets of a defined contribution
plan under ERISA constitute, at the very least, the sum of
all the assets allocated for bookkeeping purposes to the
participants’ individual accounts. Because a defined
contribution plan is essentially the sum of its parts, losses
attributable to the account of an individual participant are
necessarily “losses to the plan” for purposes of §409(a).
Accordingly, when a participant sustains losses to his
4 LARUE v. DEWOLFF, BOBERG & ASSOCIATES, INC.
THOMAS, J., concurring in judgment
individual account as a result of a fiduciary breach, the
plan’s aggregate assets are likewise diminished by the
same amount, and §502(a)(2) permits that participant to
recover such losses on behalf of the plan.*
——————
* Of course, a participant suing to recover benefits on behalf of the
plan is not entitled to monetary relief payable directly to him; rather,
any recovery must be paid to the plan.