Rahm v. Halpin’s Empirical Analysis
566 F.3d 286 · 2009
Citation profile
4 federal appellate · 1 district ·
Relationships
Applies 11 U.S.C. § 523 · 18 U.S.C. § 664 (Welfare and Pension Plans Disclosure Act) · 29 U.S.C. § 1002 (§ 3 of the Employee Retirement Income Security Act of 1974) · 29 U.S.C. § 1104 (§ 404 of the Employee Retirement Income Security Act of 1974) · 29 U.S.C. § 1109 (§ 409 of the Employee Retirement Income Security Act of 1974)
Relies on Firestone Tire and Rubber Company v. Bruch · Skidmore v. Swift & Co. · Nationwide Mutual Insurance v. Darden · Community for Creative Non-Violence v. Reid · United States v. Shabani
Most-quoted passages
The sentences later courts lift from this opinion, ranked by how many decisions quote each — the parts of the opinion doing the work. These counts are smaller than the citation total above because most of the 16 citing decisions cite the case generally; a passage count includes only decisions quoting that exact language verbatim.
“We agree with the Department’s interpretation that employer contributions become assets only after being paid. Under “ordinary notions of property rights,” if a debtor fails to meet its contractual obligations to a creditor, the creditor does not automatically own a share in the debtor’s assets. The creditor, rather, has a “chose in action,” an assignable contractual right to collect the funds owed by the debtor. See Mexican Nat’l R.R. Co. v. Davidson, 157 U.S. 201, 206 , 15 S.Ct. 563 , 39 L.Ed. 672 (1895). As one treatise explains, “[t]he terms ‘dioses in actions’ and ‘debts’ are used by courts to represent the same thing when viewed from opposite sides. The chose in action is the right of the creditor to be paid, while the debt is the obligation of the debtor to pay.” 63C Am.Jur.2d Property § 22 (2008). Accordingly, the unpaid amounts are debts; they are not assets held in trust for the benefit of the creditor. Trust law similarly supports this analysis. Cf. Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 110-11 , 109 S.Ct. 948 , 103 L.Ed.2d 80 (1989) (directing courts to consider trust law when “de velop[ing] a federal common law of rights and obligations under ERISA-regulated plans.” (internal quotation marks omitted)). Under well-settled principles of trust law, a debtor-creditor relationship is not a fiduciary relationship. See Restatement (Third) of Trusts § 5(k) & cmt. k (indicating that the relationship of a debtor to a creditor is not fiduciary in nature; rather”
1 later decision quote this exact passage · from the majority“When an employer misappropriates contributions that the employee has made to ERISA funds, the Secretary [of the Department of Labor] sues the employer directly. In contrast, when an employer fails to pay contributions, and the plan’s fiduciaries do not pursue the claim, the Secretary typically sues the fiduciaries for failing to enforce the plan’s rights.... In these cases, the Department’s position is that the employer’s failure to pay its contributions does not constitute a breach of fiduciary duty, and the Department lacks the authority to sue the employer directly.”
1 later decision quote this exact passage · from the majority“if unpaid employer contributions were plan assets, the employer would automatically become an ERISA fiduciary once it failed to make the payments. As such, the employer would owe the plan undivided loyalty at the expense of competing obligations — some fiduciary — to the business, and to others such as employees, customers, shareholders and lenders, and an undifferentiated portion of the companies[’] assets would be held in trust for the plan. It is difficult to envision how proprietors could ever operate a business enterprise under such circumstances.”
1 later decision quote this exact passage · from the majority
How this case has been treated — in progress
Whether each later court followed, distinguished, criticized, or overruled this decision. The treatment classification (task #35) runs highest-cited cases first and lights up here as it reaches this one.