>Affirming the decision of the US District Court for the Middle District of Pennsylvania, the US 3rd Circuit Court of Appeals has dismissed the case of Monique Ericson, who alleged a fiduciary breach under ERISA regarding asset allocation in a former employer’s 401(k) plan.
>Ericson had sued Greenberg & Co., where she worked from 1997 to 1999, alleging a fiduciary breach due to a heavy allocation in money market funds. When Ericson left the company, she received a rollover sum of over $10,000 in an individual retirement account. Two years later, she launched the suit, asserting that the Mark Greenberg, who administered the account, had breached her rights under ERISA by not investing in index funds. She sought $2,572 in lost investment returns and over $600,000 in penalties for a failure to provide plan documents.
>Circuit Judge Marjorie Rendell, writing for the court, ruled that because the suit was launched two years after the payout of benefits, Ericson was not a participant, and therefore could not sue under ERISA. Since she was not eligible to receive benefits at the time of the lawsuit, the lawsuit was dismissed.
“Ericson did not meet the statutory definition of ‘participant’ as it is defined in ERISA,” Rendell said in reiterating the lower court’s ruling, adding: “Because ERISA limits the ability to file suit under its provisions to ‘participants,’ the District Court dismissed the case for lack of subject matter jurisdiction.” Rendell, joined by Judge Michael Fisher and Senior Judge William Yohn, agreed with the lower court’s ruling in dismissing the case.
>The opinion in Ericson v. Greenberg & Co. is available here .