United States District Court, D. Kansas
MEMORANDUM AND ORDER
JULIE A. ROBINSON, District Judge.
Plaintiffs filed this lawsuit against Boilermaker-Blacksmith National Pension Trust ("Trust") alleging violations under the Employee Retirement Income Security Act of 1974 ("ERISA"). Plaintiffs claim that they were denied benefits under their plan and that requested information was not provided as required under 29 U.S.C. § 1132(c)(1)(B). Plaintiffs seek restoration of their benefits plus interest as well as $28, 700 in damages related to the failure to disclose. Defendant moves to dismiss these claims under Fed.R.Civ.P. 12(b)(6) on the grounds that the cause of action is barred by res judicata and alternatively, for failure to state a claim upon which relief can be granted. As explained more fully below, Defendant's motion is granted in part, with leave for Plaintiffs to amend the complaint.
Plaintiffs previously filed an action in state court against the Trust, seeking to recover benefits from the Trust alleging violations of state trust law. The lawsuit was removed to this Court, Case No. 14-cv-2319-RDR. Judge Rogers granted the Trust's motion to dismiss on the grounds that Plaintiffs' claims are governed exclusively by ERISA, and thus Plaintiffs' state law claims were preempted by federal law. The court went on to discuss that even if Plaintiffs had brought their claims against the Trust under ERISA, their allegations were insufficient to state a claim, noting that Plaintiffs had not alleged the Trust's denial of their pension benefits was an abuse of discretion or arbitrary and capricious, that Plaintiffs did not allege that they had exhausted their available administrative remedies prior to filing their action, and that their claims were not plausible. Plaintiffs appealed that decision to the United States Court of Appeals for the Tenth Circuit, which dismissed the appeal for lack of prosecution.
Plaintiffs filed their Verified Complaint in this Court on February 23, 2015. Plaintiffs acknowledge they originally brought a claim under Kansas trust laws, which was dismissed because they had not exhausted their administrative remedies. Plaintiffs allege they have now exhausted their administrative remedies and appealed the denial of their claims as required by the Plan. Those appeals were denied on December 15, 2014, because they were untimely and because the Trust must honor the Notice of Levy received from the IRS. Plaintiffs claim they were denied benefits under their plan and that requested information was not provided as required under 29 U.S.C. § 1132(c)(1)(B). Plaintiffs seek restoration of their benefits plus interest as well as damages for $28, 700 related to the failure to disclose.
II. Legal Standard
To survive a motion to dismiss, a claim must be plausible on its face. In presenting such a claim, a plaintiff must provide enough facts to convince a court that he has a "reasonable likelihood of mustering factual support for these claims." These facts must be examined in the light most favorable to the non-moving party. A court must draw on its own reason and experience to determine whether a claim is plausible on its face. Unsupported legal conclusions are not entitled to the same assumption of truth as facts.
A pro se filing is to be "liberally construed." Pro se complaints must be held to less stringent standards. It is not the role of a court to act as an advocate for a pro se party. The court should consider the merits of the arguments presented by the pro se party, even if an argument is inartfully made. Dismissal of pro se claims is only appropriate when it is clear that "the plaintiff cannot prevail on the facts he has alleged and it would be futile to give him an opportunity to amend."
Plaintiffs seek the restoration of their benefits and interest under 29 U.S.C. § 1132(a). A participant may bring a suit "to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan." A participant in a plan may also file an action based upon an "Administrator's refusal to supply requested information." Defendant moves to dismiss Plaintiffs' complaint under the doctrine of res judicata and, alternatively, for failure to state a claim. The Court addresses each issue in turn.
A. Res Judicata
Plaintiffs allege that Defendant withheld benefits from an ERISA governed plan after receiving a tax levy and failed to disclose information as required by ERISA. Plaintiffs made the same allegations in their state law claims. In dismissing those claims, Judge Rogers determined that Plaintiffs' claims were governed exclusively by ERISA and thus preempted by federal law. Judge Rogers further noted that even if Plaintiffs had alleged ERISA claims, Plaintiffs did not exhaust their administrative remedies, making an opportunity to amend the complaint futile. Plaintiffs exhausted their administrative remedies after the dismissal of their state law claims and now bring their claims under ERISA. Defendant argues that Plaintiffs are barred from suit under the doctrine of res judicata.
Considering the procedural history of the case and the limited jurisdictional basis for the decision of Judge Rogers, the Court finds that the order dismissing Plaintiffs' state law claims as preempted by federal law is not a decision having full res judicata effect. Instead, dismissal for want of subject matter jurisdiction operates as res judicata only as to future jurisdictional issues. Moreover, it is clear that a claim falls under the doctrine of res judicata only if a judgment on the merits of the action has been reached. In the previous case, the Court noted that even if Plaintiffs had brought their claims under ERISA, they had not exhausted administrative remedies available to them. Courts have recognized a requirement to exhaust administrative remedies as implicit within ERISA. ERISA claims that have been dismissed for failure to exhaust administrative remedies are presumed to have been dismissed without prejudice. Thus, examining the record before the Court, it is apparent that Judge Rogers did not have the opportunity to address the merits of ...