United States District Court, N.D. California
For Richard Todd Thomas, Plaintiff: Steven M. Olson, Steven Marc Olson, LEAD ATTORNEYS, Law Office of Steven M. Olson, Santa Rosa, CA.
Steven Marc Olson, Creditor, Pro se, Santa Rosa, CA.
For Steven Marc Olson, Creditor: Steven Marc Olson, Santa Rosa, CA.
For James S. Bostwick, Professional Corporation, Creditor: Peter Logan Simon, LEAD ATTORNEY, Beyers Costin Simon, Santa Rosa, CA.
For James S. Bostwick, Defendant: Suzanne K. Babb, LEAD ATTORNEY, Beyers Costin Simon P.C., Santa Rosa, CA.
ORDER DENYING MOTION TO ALTER OR AMEND JUDGMENT Re: Dkt. No. 92
JOSEPH C. SPERO, United States Magistrate Judge.
This is a case for breach of fiduciary duty under the Employee Retirement Income Security Act (" ERISA"), specifically 29 U.S.C. § § 1109(a) and 1132(a)(2). The Court previously entered judgment in favor of Plaintiff Richard Todd Thomas. Defendant James S. Bostwick now moves pursuant to Rule 59(e) of the Federal Rules of Civil Procedure for the Court to alter or amend its previous judgment (the " Motion, " dkts. 92, 93). The Court finds the matter suitable for resolution without oral argument and vacates the hearing scheduled for November 19, 2014. See Civ. L.R. 7-1(b). Mr. Bostwick's arguments are largely improper efforts to relitigate matters previously considered and decided, or to raise arguments that could have been made before the entry of judgment. The Court also finds Mr. Bostwick's arguments unpersuasive on their merits. Accordingly, for the reasons discussed below, Mr. Bostwick's Motion is DENIED.
This Order assumes the parties' familiarity with the facts of the case, which are set forth in more detail in the Court's previous order on the parties' cross motions for judgment (the " Order, " dkt. 85). In brief, Mr. Thomas was employed as an accountant by James S. Bostwick, Professional Corporation (the " Corporation") from 1996 to 2005. Joint Statement of Undisputed Facts (" JSUF, " dkt. 51) ¶ 1. During that time, he embezzled vast sums of money from the Corporation, for which the Corporation obtained both a civil judgment and a restitution order. Id. ¶ ¶ 3-4.
Mr. Bostwick was the president of the Corporation and the trustee of trusts relating to certain defined-contribution profit-sharing plans (the " Plans") set up for the Corporation's employees. Id. ¶ 8. In 2008 and 2009, the Corporation liquidated the trusts, which " are no longer in existence." Id. ¶ 9. Mr. Bostwick requested that Mr. Thomas consent to transfer Mr. Thomas's share of the Plans to the Corporation in partial satisfaction of his judgment debts. Id. ¶ 19. Mr. Thomas declined to so consent, but the funds were transferred anyway and the Corporation deposited the checks. Id. ¶ ¶ 11, 19.
Mr. Thomas brought this action against Mr. Bostwick for breach of fiduciary duty under sections 409(a) and 502(a)(2) of ERISA, 29 U.S.C. § 1109(a), 1132(a)(2). The parties waived their rights to live testimony and stipulated that the Court should enter judgment based on cross-motions for judgment and the parties' Joint Statement of Undisputed Facts. See Stipulation (dkt. 53). The Court entered judgment in favor of Mr. Thomas, holding that ERISA did not permit the transfer of benefits to the Corporation and that Mr. Thomas could recover from Mr. Bostwick personally for his breach of fiduciary duty, so long as his recovery was limited to the benefits that he should have received. See generally Order Granting Pl.'s Mot. for J. & Denying Def.'s Mot. for Summ. J. (" Order, " dkt. 85). The Court relied, inter alia, on the Supreme Court's decision in Guidry v. Sheet Metal Workers Nat'l Pension Fund, 493 U.S. 365, 110 S.Ct. 680, 107 L.Ed.2d 782 (1990), in holding that the transfer was impermissible, and on the Supreme Court's decision in LaRue v. DeWolff, Boberg & Assocs., Inc., 552 U.S. 248, 128 S.Ct. 1020, 169 L.Ed.2d 847 (2008) and the Seventh Circuit's decision in Harzewski v. Guidant Corp., 489 F.3d 799 (7th Cir. 2007), in holding that Mr. Thomas could obtain a monetary judgment against Mr. Bostwick. See generally Order.
Mr. Bostwick now moves under Rule 59(e) for the Court to alter or amend its previous judgment, based on four arguments. First, Mr. Bostwick argues that Mr. Thomas's claim was barred because he failed to first exhaust the Plans' claims procedures. Mot. at 2-3. Second, he argues that relief was not available under section 502(a)(2) because Mr. Thomas should have brought his claim against the Plans under section 502(a)(1)(B). Id. at 3-4. Third, he contends that no breach occurred because the transfer was within the discretion of the plan ...