Appeal from the United States District Courtfor the Central District of CaliforniaStephen V. Wilson, District Judge, PresidingArgued and SubmittedSeptember 13, 1999--Pasadena, CaliforniaFiled February 10, 2000Before: Betty B. Fletcher and Harry Pregerson,Circuit Judges, and Charles R. Weiner, 1Senior District Judge.Opinion by Judge B. Fletcherciaries under the Employee Retirement Income Security Act(ERISA) seeking to enforce an ERISA plan's contractualreimbursement provisions do not fall within the statute's civilenforcement provisions, is still binding Ninth Circuit prece-dent.After suffering injuries in a car accident, appellee RobertEllis received more that $561,145 in benefits for himself andhis health-care providers from the group medical plan ofappellant Reynolds Metals Company. The plan contained aprovision requiring participants to reimburse the plan for itspayment for health-care services if they received payment fortheir underlying injuries from a third party.Ellis settled a claim against the third parties responsible forthe accident, but refused to pay Reynolds for any of the bene-fits he received from the plan. Reynolds sued to enforce thecontractual reimbursement provision.In FMC Medical Plan v. Owens, 122 F.3d 1258 (9th Cir.1997), the court held that ERISA actions by fiduciaries seek-ing to enforce an ERISA plan's contractual reimbursementprovisions do not fall within the statute's civil enforcementprovisions.Reynolds contended that although its appeal was essentiallyindistinguishable from Owens, that case was wrongly decidedand conflicted with Supreme Court and Ninth Circuit author-ity.[1] ERISA provides for a federal cause of action for civilclaims aimed at enforcing the provisions of an ERISA plan.To make such a claim, a plaintiff must fall within one ofERISA's specific enforcement provisions, which detail whomay bring suit and what remedies are available.[2] To prevail, Reynolds had to demonstrate that it was anERISA fiduciary, and that it was seeking equitable, ratherthan legal relief. [3] The sole issue was whether reimburse-ment under the contractual provisions of the ERISA plan wasproperly characterized as "equitable."[4] While Reynolds couched its remedial prayers in equita-ble language, a court must look to the substance of the remedysought, rather than the label placed on that remedy.[5] Reynolds failed to demonstrate that Owens conflictedwith any binding Supreme Court or Ninth Circuit authority.[6] This case was controlled by Owens . The district court'sdismissal of Reynolds' action had to be affirmed.
_____________________________COUNSEL Edward A. Scallet, LeBoeuf, Lamb, Green & MacRae, Wash-ington, D.C., for the plaintiff-appellant.James B. Kropff, Girardi & Keese, Los Angeles, California,for the defendant-appellee.
_____________________________OPINION B. FLETCHER, Circuit Judge:Reynolds Metals Company seeks reimbursement for pay-ments it made to Robert Ellis because Ellis received a thirdparty settlement from an accident in which he was injured.We have previously held, in FMC Medical Plan v. Owens,122 F.3d 1258, 1262 (9th Cir. 1997), that actions brought byfiduciaries under the Employee Retirement Income SecurityAct of 1974 ("ERISA") against beneficiaries to enforce reim-bursement clauses (also known as "subrogation " clauses) con-tained in ERISA plans should be dismissed. This case iscontrolled by Owens. Therefore, we affirm the district court'sdismissal of this action.Robert Ellis, the defendant, was an employee of ReynoldsMetals Company ("Reynolds Metals") and a beneficiary in itsgroup medical plan. Ellis was involved in an auto accident in1994 and was seriously injured. In the aftermath of the acci-dent, the plan paid "no less than $561,145.21" in benefits toEllis and his health care providers.The plan contains a contractual reimbursement provisionwhich states: "If the Plans paid for health care services, sup-plies or treatment and you receive payment from a third party,you must reimburse the Plans, but not more than the amountof the third-party payment you received." The plan furtherspecifies that reimbursement is required whether paymentsreceived are partly or entirely "for health care expenses as theresult of a legal settlement or other action arising from anaccident, injury or illness."Sometime in 1997, Ellis settled a claim against the third-parties responsible for the accident, receiving an amount inexcess of the benefits paid to him by the plan. Since that time,he has refused to reimburse Reynolds Metals for any of thebenefits paid to him.On August 15, 1997, Reynolds Metals filed suit in federaldistrict court seeking to enforce the contractual reimburse-ment provision pursuant to ERISA S 502(a)(3), 29 U.S.C.S 1132(a)(3). In lieu of answering the complaint, Ellis madea motion to dismiss the action and the district court grantedthe motion.[1] ERISA provides for a federal cause of action for civilclaims aimed at enforcing the provisions of an ERISA plan.See 29 U.S.C. S 1132(e)(1). In order to make such a claim,however, a plaintiff must fall within one of ERISA's nine spe-cific civil enforcement provisions, each of which details whomay bring suit and what remedies are available. See 29 U.S.C.S 1132(a)(1)-(9). Reynolds Metals invokes the third of thenine categories, which provides that a civil action may bebrought: (3) by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which violates any provi- sion of this subchapter or the terms of the plan, or (B) to obtain other appropriate equitable relief (i) to redress such violations or (ii) to enforce any provi- sions of this subchapter or the terms of the plan;29 U.S.C. S 1132(a)(3).[2] To prevail, Reynolds Metals must demonstrate (1) thatit is an ERISA fiduciary, and (2) that it is seeking equitable,rather than legal, relief. See Administrative Comm. v. Gauf,188 F.3d 767, 770 (7th Cir. 1999); Owens, 122 F.3d at 1260.[3] Because there is no serious dispute regarding the statusof Reynolds Metals as a fiduciary, the sole issue is whetherthe relief the plaintiff seeks -- namely, reimbursement underthe contractual reimbursement provisions of the ERISA plan-- is properly characterized as "equitable" within the meaningof S 1132(a)(3).In Owens, FMC, an ERISA fiduciary, brought suit againstJeffrey Owens, an FMC employee and beneficiary of theERISA plan, to enforce a contractual reimbursement provi-sion. Owens was injured in an automobile accident. As aresult of the accident, FMC paid benefits to Owens totalingroughly $50,000. Owens subsequently settled his claimagainst the driver of the other car for $100,000. The FMCplan included a contractual reimbursement provision. Prior topaying benefits, FMC also required that Owens sign an addi-tional agreement restating his reimbursement obligation. Thisobligation notwithstanding, Owens refused to reimburse FMCfor the benefits he had received. FMC brought suit in federalcourt seeking to obtain "equitable reimbursement. " Owens,122 F.3d at 1259.In Owens, we concluded that the relief FMC sought wasnot equitable within the meaning of S 1132(a)(3). See id. at1262. In reaching this conclusion, we rejected several alterna-tive interpretations of the remedy FMC sought. The opinionbegins by rejecting the notion that the remedy sought wasequivalent to the equitable remedy of subrogation, noting thatFMC was not "stepping into the shoes" of its beneficiary inan effort to proceed directly against the third-party tortfeasor.See id. at 1260. The opinion next distinguishes the requestedreimbursement remedy from restitution, explaining that resti-tution requires the showing of fraud or wrong-doing. See id.at 1261. Owens, in contrast, had rightfully received the bene-fits to which he was entitled. Finally, we rejected the confla-tion of reimbursement with the remedy of constructive trust.See id. A constructive trust remedy is appropriate only wherethere has been a breach of fiduciary duty and an "ill-gotten"gain, neither of which is present in the typical action seekingcontractual reimbursement.[4] Reynolds Metals admits that its appeal is effectivelyindistinguishable from Owens in that it is an effort by anERISA fiduciary to enforce contractual reimbursement provi-sions against beneficiaries. While it is true that the plaintiffhere couched its remedial prayers in equitable language, it isclear that a court must look "to the substance of the remedysought, . . . rather than the label placed on that remedy." Id.at 1261 (quoting Watkins v. Westinghouse Hanford Co., 12F.3d 1517, 1528 n.5 (9th Cir. 1993)); see also Mertens v.Hewitt Associates,
508 U.S. 248, 255
(1993) ("Although theyoften dance around the word, what petitioners in fact seek isnothing other than compensatory damages . . . ."). Wedeclined "to extend the interpretation of section 1132(a)(3) toinclude a claim for reimbursement." Owens, 122 F.3d at 1262.2The existence of such controlling Ninth Circuit precedentshould end the matter. See Roundy v. Commissioner, 122 F.3d835, 837 (9th Cir. 1997) ("A three-judge panel is bound by aprior judgment of this court unless the case is taken en bancand the prior decision is overruled."). However, ReynoldsMetals contends that Owens was wrongly decided and urgesthe panel to call for an initial hearing en banc. See Ninth Cir-cuit General Rule 5.2.b.Reynolds Metals contends that Owens directly conflictswith both Supreme Court and Ninth Circuit authority. Takingtheir lead from the Eleventh Circuit, Reynolds Metals attacksOwens as based on an "unduly narrow reading of Mertens."Blue Cross & Blue Shield v. Alabama, 138 F.3d 1347, 1353n.5 (11th Cir. 1998). In Mertens, the question was whetherERISA authorizes suits for money damages against nonfidu-ciaries who knowingly participate in a fiduciary's breach ofduty. The parties focused on the propriety of the relief, ratherthan the availability of an action under ERISA against a non-fiduciary, leading the Supreme Court to limit its attention tothe phrase "other appropriate equitable relief " in S 1132(a)(3).See Mertens,
508 U.S. at 254
-55. The Court concluded that"equitable relief" in the context of S 1132(a)(3) must beunderstood to mean "those categories of relief that weretypically available in equity (such as injunction, mandamus,and restitution, but not compensatory damages)." Id. at 256(emphasis in original).The panel in Owens relied heavily on Mertens, and there isnot a conflict between the two opinions. Reynolds Metals sug-gests that Owens conflicts with Mertens because Owens barsall claims for monetary relief under S 1132(a)(3). This badlymischaracterizes the Owens opinion -- the opinion accepts, asdoes Mertens, that restitution and constructive trust remediesmay be appropriate under S 1132(a)(3), provided some fraudor wrong-doing is shown. See Owens, 122 F.3d at 1261.Reynolds Metals also suggests that Owens conflicts withVerity Corp. v. Howe,
516 U.S. 489
(1996). In Verity, theSupreme Court held that S 1132(a)(3) supports a cause ofaction for individual beneficiaries who allege that a plan fidu-ciary made material misrepresentations about their benefits.Reynolds Metals views this holding as amounting to anendorsement of tort damages under S 1132(a)(3) and abrogat-ing the narrow reading of Mertens adopted by our court inOwens. This argument is meritless. The remedy the SupremeCourt endorsed in Verity was reinstatement, a traditionallyequitable one. See id. at 495 (monetary relief not at issue).Moreover, given that the beneficiaries' action was premisedon a breach of fiduciary duty, Verity involved a circumstancewhere fraud and "ill-gotten" gain figured prominently.Reynolds Metals also claims that Owens represents anintra-circuit split with two other Ninth Circuit authorities.This is not the case. The first decision Reynolds Metals relieson, Chitkin v. Lincoln Nat'l Life Ins. Co., 1993 WL 484720(9th Cir. Nov. 24, 1993), is an unpublished memorandum dis-position, and thus is not binding precedent.3 The second opin-ion relied upon by Reynolds Metals, Pacificare, Inc. v.Martin, 34 F.3d 834 (9th Cir. 1994), also creates no intra-circuit conflict. Although Pacificare involved a contractualreimbursement provision, we never reached the question ofwhether reimbursement was an "equitable" remedy underS 1132(a)(3). See id. at 838 ("Thus far, Pacificare has not pur-sued a claim for equitable relief under section 1132(a)(3), andneither party has developed the arguments to support or rejectsuch a claim.").[5] In summary, Reynolds Metals has failed to demonstratethat Owens conflicts with any binding Supreme Court orNinth Circuit authority. This undercuts its claim that an initialhearing en banc is necessary.[6] This case is controlled by Owens, which holds thatactions by ERISA fiduciaries seeking to enforce an ERISAplan's contractual reimbursement provisions do not fall withinS 1132(a)(3). Therefore, we affirm the district court's dis-missal of Reynolds Metals' action. AFFIRMED.
___________________________FOOTNOTES 1 Charles R. Weiner, Senior United States District Judge for the EasternDistrict of Pennsylvania, sitting by designation.2 Owens rests its dismissal on the lack of subject matter jurisdiction. Butsee Cement Masons Health and Welfare Trust Fund for Northern Califor-nia v. Stone, 197 F.3d 1003, 1008 (9th Cir. 1999) (reaffirming the substan-tive holding in Owens but dismissing on the merits rather than on subjectmatter jurisdiction). For our purposes, in evaluating the substantive hold-ing of Owens requiring the dismissal of reimbursement claims for thirdparty settlements under ERISA, the dismissal could be based either onlack of subject matter jurisdiction or on the merits.3 The fact that the memorandum disposition was published as an appen-dix to the district court's opinion on remand does not transform the dispo-sition into binding precedent.