Narrative Opinion Summary
In this case, Ferfolia Funeral Homes Inc. sought to dismiss a complaint filed by the Pension Benefit Guaranty Corporation (PBGC), arguing that it was filed past the statute of limitations. Ferfolia, an Ohio-based entity with a defined-benefit pension plan under ERISA, terminated the plan in 2003 and distributed benefits in 2005. PBGC discovered discrepancies in these distributions and filed suit in 2011. The legal dispute hinged on when the cause of action for the statute of limitations began, with PBGC asserting it started with the improper distributions in 2005, while Ferfolia argued for the plan's termination date in 2003. The court applied the standard for a motion to dismiss under Fed. R. Civ. P. 12(b)(6), assuming the truth of the plaintiff's allegations. It concluded that the cause of action accrues when a breach occurs, supporting PBGC's timeline. The court distinguished between types of plan terminations, noting that standard terminations don't activate the statute of limitations until an ERISA violation occurs. Consequently, the court ruled PBGC's complaint was timely, and Ferfolia's motion to dismiss was denied.
Legal Issues Addressed
Accrual of Cause of Actionsubscribe to see similar legal issues
Application: A cause of action accrues when a breach occurs, and a plaintiff must have a 'complete and present cause of action' to file suit.
Reasoning: The Supreme Court has stated that a limitations period does not begin until a plaintiff has a 'complete and present cause of action,' meaning that the plaintiff must be able to file suit for relief.
Distinction Between Types of Pension Plan Terminationssubscribe to see similar legal issues
Application: The statute of limitations is not activated in standard terminations until an ERISA violation occurs, unlike distress or PBGC-initiated terminations.
Reasoning: In contrast, a standard termination involves plans with sufficient assets to cover liabilities, meaning there is no employer liability or PBGC claim on the termination date.
Standard for Motion to Dismiss under Fed. R. Civ. P. 12(b)(6)subscribe to see similar legal issues
Application: The court must presume all allegations in the complaint to be true and dismiss only if no set of facts supports the plaintiff's claim.
Reasoning: The standard for reviewing a motion to dismiss under Fed. R. Civ. P. 12(b)(6) dictates that all allegations in the complaint are presumed true, and the complaint is construed liberally in favor of the non-moving party.
Statute of Limitations under ERISAsubscribe to see similar legal issues
Application: The statute of limitations for PBGC's claim under ERISA is determined based on when the cause of action arose, specifically linked to the date of improper distributions, not the plan termination date.
Reasoning: PBGC asserts that the cause of action accrued on April 29, 2005, when Ferfolia made incorrect distributions to plan participants, while Ferfolia claims it arose on the plan's termination date, July 14, 2003.