Sereboff v. Mid Atlantic Medical Services, Inc. - Oral Argument - March 28, 2006

Sereboff v. Mid Atlantic Medical Services, Inc.

Media for Sereboff v. Mid Atlantic Medical Services, Inc.

Audio Transcription for Opinion Announcement - May 15, 2006 in Sereboff v. Mid Atlantic Medical Services, Inc.

Audio Transcription for Oral Argument - March 28, 2006 in Sereboff v. Mid Atlantic Medical Services, Inc.

John G. Roberts, Jr.:

We'll hear argument first this morning in Sereboff v. Mid Atlantic Medical Services.

Mr. Stris.

Peter K. Stris:

Thank you, Mr. Chief Justice, and may it please the Court--

The question presented today is whether a claim for contractual reimbursement is cognizable under section 502(a)(3) of ERISA.

In this case, MAMSI, the fiduciary of an ERISA plan, seeks monetary reimbursement from the Sereboffs, two beneficiaries of the plan.

MAMSI has consistently taken the position that its money claim is governed exclusively by the terms of its contract with the Sereboffs.

This contract expressly disclaims and replaces most equitable principles.

At its core, MAMSI's claim is nothing more than a request for money damages.

This claim is not cognizable under ERISA because MAMSI is not entitled to any relief that was typically available at equity.

David H. Souter:

May I ask you this?

If the... if the day before the settlement was consummated, the plan had gone into court and had said the... the beneficiaries plan to settle the case and they've indicated that they're not going to give us any of the settlement in accordance with the terms of the contract and we want an injunction preventing their distribution to anyone but... but us, if the... if the judge believed that and believed that under the contract, the plan was entitled to reimbursement, could the judge have enjoined the... the distribution of the funds to the... you know, to the extent of the plan's claim?

Peter K. Stris:

Well, what I would say, Justice Souter, is that an injunction to... merely to prohibit distribution would be equitable relief.

David H. Souter:


Peter K. Stris:

That doesn't necessarily mean, however, that once that injunction issued, the plan could enforce the terms of the contract under ERISA.

David H. Souter:

Well, it could enforce the injunction.

Peter K. Stris:

It could enforce the injunction provided that... that the injunction was not a mandatory injunction.

This Court in GreatWest clearly held that a mandatory injunction under 502(a)(3), saying pay us this money that's due under the contract, is not--

David H. Souter:

Yes, but that... that was... that was an ex post remedy and there were no identifiable funds.

What we're talking about here is an ex ante injunction and the funds are identifiable.

And you are telling me that, in fact, all the... all the equity court could have said was, don't pay yourself?

Peter K. Stris:


David H. Souter:

It could not have said, give the $75,000, or whatever it is, to the plan?

Peter K. Stris:

--I... I would say two things, Justice Souter.

The first is that, respectfully, I don't think GreatWest made the distinction that a mandatory injunction was impermissible because it was ex post.

I think GreatWest squarely held that a mandatory injunction is just a clever attempt by lawyers to enforce a contract for legal damages.

David H. Souter:

Well, when we get down to clever attempts, aren't we at the clever attempt point when... when you say that they can enjoin the distribution to anybody else, including themselves, but they can't tell them to pay the money to... to GreatWest?

I mean, isn't that the point at which we get to silliness?

Peter K. Stris:

I don't... I don't think that's true, Your Honor, because we do not take the position that MAMSI or an ERISA plan doesn't have alternative remedies.

Of course, there... that... that should... that consideration should be irrelevant because either the claim is legal or equitable, and there are many claims that beneficiaries have for the violation of a plan term that--

David H. Souter:

But you... in any case, I don't want to prolong this unduly.