United States District Court, D. Maryland
ELLEN LIPTON HOLLANDER, District Judge.
Plaintiffs Esli Perez Melendez ("E. Perez"), Alvaro Perez Melendez ("A. Perez"), Herber Arriaza Monroy ("H. Arriaza"), and David Arriaza Monroy ("D. Arriaza"), have filed suit on behalf of nearly 40 Spanish-speaking current and former employees of defendant Hatfield's Equipment & Dedication Services Inc. ("Hatfield's"). Plaintiffs, who worked on Hatfield's concrete crew, have also sued Maureen Hatfield ("Ms. Hatfield"); Kenneth P. Hatfield ("Mr. Hatfield"); and Hatfield Equipment & Dedication Services Inc. Profit Sharing Plan ("Hatfield Plan" or "the Plan"). They allege that defendants failed to comply with the reporting and disclosure requirements of the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. §§ 1001 et seq. and failed to provide plan documents upon request, as mandated by ERISA.
In particular, in their Amended Complaint (ECF 14), plaintiffs allege that defendants were required to make plan disclosures in a manner calculated to be understood by the average participant under ERISA §§ 102(a), (b), and 104(b), and that "[t]he average participant in the Defendant Plan speaks and reads Spanish as his primary language, " and therefore was unable to understand plan disclosures made in English. Am. Comp. ¶ 72. Further, plaintiffs allege: "Defendant Plan did not distribute notices of plan contribution allocations, statements of profits upon which contributions would be calculated, or other documents that would permit the participants to calculate their benefits." Id. at ¶¶ 45. Finally, plaintiffs allege that they were not provided the documents they requested, as required by ERISA.
The Amended Complaint contains two counts, each seeking relief under a separate ERISA provision. Count I seeks equitable relief under 29 U.S.C. § 1132(a)(3), specifically asking the Court to (1) "Order Defendants to issue plan documents and benefit statements in Spanish, " and (2) "Order Defendants to remit surcharge to Plaintiff class members who never received plan documents (in English or Spanish) in accordance with ERISA when they became participants and did not receive benefits statements written in Spanish." Id. ¶ 89. Count II asks the Court to (1) "Award Plaintiffs and class members who wrote Defendants requesting plan documents penalties pursuant to 29 U.S.C. § 1132(c)(1)(B) for untimely submitted plan documents and failure to respond to document requests, " and (2) "appropriate equitable relief for Defendants' breaches of their fiduciary duties" under 29 U.S.C. § 1132 (a)(3). Id.
Defendants filed a Motion to Dismiss the Amended Complaint ("Motion, " ECF 20), along with a memorandum of law ("Memo, " ECF 20-1), supported by several exhibits. Plaintiffs filed an opposition to the Motion (ECF 23), and defendants filed a Reply (ECF 24).
No hearing is necessary to resolve the Motion. See Local Rule 105.6. For the reasons that follow, I will grant the Motion in part and deny it in part.
Plaintiffs are current and former employees of Hatfield's and participants in the Hatfield Plan. Mr. Hatfield is the principal owner and registered agent of Hatfield's, a Maryland corporation with its headquarters in Annapolis Junction, Maryland. Ms. Hatfield is the Trustee of the Plan. Hatfield's is registered as the "Plan Administrator" and the "plan sponsor" under 29 U.S.C. § 1002(16)(A)-(B).
1. General allegations
Plaintiffs allege that "no member of the class... timely received a SPD [Summary Plan Description] which complied with ERISA's statutory requirement or corresponding regulatory provisions at the time of becoming a participant." Am. Comp. ¶ 38. According to plaintiffs, "none of the required plan documents have been written to be understood by the average plan participant because they are not in Spanish, a language read and spoken by the average plan participant of the Defendant Plan." Id. ¶ 37. Plaintiffs also claim that "[t]he Plan did not issue statements to participants regarding their accounts until on or about 2009, when the Plan provided statements for plan year 2008, " and that "[p]laintiffs received plan benefit statements on an erratic basis which appear to reflect service credit and benefit credit, without explanation of how the credit is determined." Id. ¶ 39-40.
2. Allegations Specific to E. Perez
According to the Complaint (ECF 1), E. Perez worked for Hatfield's from August 20, 2002, until September 26, 2012. ECF 1 ¶ 6. He was terminated from Hatfield's in September 2012. On October 9, 2012, E. Perez wrote a letter to Mr. Hatfield stating, ECF 20-2:
"I would  like to inquire about any information I am entitled to have with regards to how to access the Profit Sharing Plan dated 12/31/2008 that is still active for the account created for me during my course of employment and any other benefits I may be entitled to during my tenure at your company."
On November 13, 2012, Pension Design Group, which plaintiffs allege is the "third party administrator of the Plan, " sent a letter to E. Perez advising him to mail his request directly to Hatfield's. Am. Comp. ¶ 51. On December 5, 2012, E. Perez sent Hatfield's a letter requesting information about his pension benefits. The subject line of the letter was "Re: Request for Copy of Profit Sharing Plan" and, in the body of the letter, E. Perez requested "a copy of [his] Hatfield Equipment and Dedication Services, Inc. Profit Sharing Plan." Id. ¶ 52. Ms. Hatfield sent an undated letter in response, stating: "Our plan distributions are calculated at the end of the year. At that time employees who have ended employment with the company during the year will be sent a distribution packet." She did not provide a copy of the Profit Sharing Plan. Id. ¶ 53; ECF 20-3.
Richard Renner, counsel for plaintiffs, called Pension Design Group in March 2013 to inquire about E. Perez's Profit Sharing Plan account. Pension Design Group allegedly stated that Mr. E. Perez's account became active in 2007 but gave no further information. Am. Comp. ¶ 54.
On February 14, 2013, E. Perez received a letter from Pension Design Group explaining his options for obtaining his retirement benefits from the Plan. The letter did not provide him with the Plan Document or with any information about his accrued benefits. It only contained the forms required for E. Perez to elect to receive either a distribution or direct rollover to another plan. Am. Comp. ¶ 56.
E. Perez wrote to Pension Design Group through his legal representative on April 22, 2013. Id. ¶ 57; ECF 20-4. E. Perez's counsel requested "copies of any and all documents relating to the status or condition of Hatfield Equipment & Dedication Inc. Profit Sharing Plan and all other pertinent information, " as well as all "records regarding the participation of" E. Perez in the plan. Am. Comp. ¶ 57; ECF 20-4.
On April 25, 2013, Pension Design Group wrote a letter to E. Perez's counsel advising that it was not the Plan Administrator and that "[a]ny matters concerning the profit sharing plan maintained by Hatfield Equipment & Dedication Inc. should be directed to them." Pension Design Group copied Ms. Hatfield on the letter. Am. Comp. ¶ 58; ECF 23-1.
E. Perez's counsel contacted Hatfield's on July 3, 2013, to request "copies of any and all documents relating to the status or condition of Hatfield Equipment & Dedication Inc. Profit Sharing Plan, and all other ...