Earlier this morning, the Supreme Court of the United States issued a unanimous opinion in Intel Corp. Investment Policy Committee v. Sulyma, No. 18-1116, October Term, 2019. Justice Alito authored the Court’s opinion. A copy of the opinion can be found here. The opinion interprets ERISA’s statute of limitations and repose found in Section 413 of the statute, 29 U.S.C. § 1113. Mr. Sulyma was represented by several friends of the firm: R. Joseph Barton of Block and Leviton, Joseph Creitz of Creitz & Serebin, and Gregory Porter of Bailey and Glasser. Matthew Wessler of Gupta Wessler lead the brief writing team and argued the case before the Court for Mr. Sulyma.
Section 413 of ERISA provides:
No action may be commenced under this subchapter with respect to a fiduciary’s breach of any responsibility, duty, or obligation under this part, or with respect to a violation of this part, after the earlier of–
(1) six years after (A) the date of the last action which constituted a part of the breach or violation, or (B) in the case of an omission the latest date on which the fiduciary could have cured the breach or violation, or
(2) three years after the earliest date on which the plaintiff had actual knowledge of the breach or violation;
except that in the case of fraud or concealment, such action may be commenced not later than six years after the date of discovery of such breach or violation.
29 U.S.C. § 1113 (emphasis added). The issue in Sulyma was described as follows: “whether a plaintiff necessarily has ‘actual knowledge’ of the information contained in disclosures that he receives but does not read or cannot recall reading.” The Court held “that he does not and therefore affirmed” the decision of the U.S. Court of Appeals for the Ninth Circuit.
The Court explained that the statutory text is unambiguous and means what it says. It noted, “Although ERISA does not define the phrase ‘actual knowledge,’ its meaning is plain. Dictionaries are hardly necessary to confirm the point, but they do. When Congress passed ERISA, the word ‘actual’ meant what it means today: ‘existing in fact or reality.'” Thus, in order for Section 413’s three-year statute of limitations provision to apply, “the plaintiff must in fact have become aware of” the alleged fiduciary breach giving rise to his or her cause action. In so doing, the Court expressly rejected Intel’s position that making information available to a plan participant that he or she may not have ever read was sufficient to put the participant on notice of an alleged fiduciary breach.
The Sulyma decision is a great victory for plan participants and for common sense. We are thrilled for our friends who represent Mr. Sulyma and for the positive impact this decision will have on plan participants in the future.
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