Plaintiff points to the defendants' distribution of the plan brochures to its workers as evidence of deliberate false representations warranting imputation of a plan. Again, however, under the case law the Court must find that ERISA does not provide a remedy for an employer's fraud or negligent misrepresentation in cases where no plan as been "established or maintained" as determined by "express terms" or "surrounding circumstances." Two recent court of appeals decisions address the issue of whether an employer's distribution of a summary plan description evidences establishment of a plan, Wickham v. Northwestern Nat. Ins. Co., 908 F.2d 1077 (1st Cir.), cert. denied, 112 L. Ed. 2d 586, 111 S. Ct. 581 (1990) (life insurance plan), and Kanne v. Connecticut General Life Ins. Co., 867 F.2d 489 (9th Cir. 1988), cert. denied, 492 U.S. 906, 106 L. Ed. 2d 566, 109 S. Ct. 3216 (1986) (medical insurance plan). Both cases indicate that an employer's distribution of "such a booklet, detailing ERISA rights, is strong evidence that the employer has adopted an ERISA regulated plan." Wickham, 908 F.2d at 1083; see Kanne, 867 F.2d at 491-93. Again, however, both cases dealt with situations in which the employers maintained established benefit plans and in no way required the courts, as here, to fashion an employee benefit plan out of whole cloth.
Finally, the Court acknowledges plaintiff's argument that, although defendants never adopted a plan, their withholding of fringe benefits based on the false representation that they were investing these funds places them within the scope of ERISA's fiduciary provisions. The Court finds that this argument is answered by plaintiff's own acknowledgment that "normally, plan participants are do not have standing under ERISA to directly sue their employer for failing to contribute to an employee plan" and "are restricted to suing derivatively, on behalf of the plan, and then only if the plan's trustees breach their fiduciary duties by not suing the employer." Plaintiff's Memo at 10. See Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 141-143, 87 L. Ed. 2d 96, 105 S. Ct. 3085 (1985). While here there is no plan on behalf of which the plaintiff might sue, the Court rejects plaintiff's contention that "ERISA's remedial purposes can be achieved only by allowing the employees to sue their employer for relief that ordinarily is available only to the plan, plan administrator or trustee." Plaintiff's Memo at 10. On the contrary, in addition to actions in tort and contract available to plaintiff in state court, the Davis Bacon Act provides a process for recourse and restitution through the Department of Labor, including referral to the United States Attorney for prosecution in appropriate cases. See 40 U.S.C. 276a et seq. and 29 C.F.R. Part 5 (1991).
The Court is not unmindful of the strong equities presented by the plaintiff's case. Notwithstanding the clear suggestion of intentional or negligent wrongdoing by the plaintiffs, however, the Court finds no legal basis for extending even the elastic fiduciary provisions of ERISA to the bounds indicated here. Accordingly, the Court finds as a matter of law that the defendants did not establish a employee benefit plan subject to ERISA, and that the plaintiff therefore fails to state a federal cause of action upon which relief can be granted. In the absence of a federal question, the Court lacks subject matter jurisdiction to consider plaintiff's claims and dismisses this suit on that account.
Judge George H. Revercomb
EDITOR'S NOTE: The following court-provided text does not appear at this cite in 790 F. Supp. 12.
ORDER - March 31, 1992, Filed
For the reasons set forth in the accompanying Memorandum and Opinion, it is
ORDERED that this suit is DISMISSED for lack of subject matter jurisdiction under 28 U.S.C. 1331.
Judge George H. Revercomb