                                                                                                                           Opinions of the United
1995 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit


9-8-1995

Secretary of Labor v Compton
Precedential or Non-Precedential:

Docket 93-2019




Follow this and additional works at: http://digitalcommons.law.villanova.edu/thirdcircuit_1995

Recommended Citation
"Secretary of Labor v Compton" (1995). 1995 Decisions. Paper 153.
http://digitalcommons.law.villanova.edu/thirdcircuit_1995/153


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                   UNITED STATES COURT OF APPEALS
                       FOR THE THIRD CIRCUIT
                            ____________

                             No. 93-2019
                             ____________

                 ROBERT B. REICH, Secretary of the
                 United States Department of Labor,
                              Appellant

                                 v.

            FRED COMPTON, JOSEPH McHUGH, JOHN NIELSON,
FREDERICK HAMMERSCHMIDT, GERSIL N. KAY, THE FIDELITY-PHILADELPHIA
  TRUST COMPANY, and THE INTERNATIONAL BROTHERHOOD OF ELECTRICAL
                   WORKERS, LOCAL UNION NO. 98,
                             Appellees

                         __________________

           ON APPEAL FROM THE UNITED STATES DISTRICT COURT
              FOR THE EASTERN DISTRICT OF PENNSYLVANIA
                       (D.C. Civil No. 88-7920)
                         ____________________

                       ORDER AMENDING OPINION
                        ____________________


Present:   BECKER, ALITO, and GIBSON,* Circuit Judges:



           IT IS ORDERED THAT the opinion in the above matter is

hereby amended as follows:

           1. The following text on page 33 is deleted:
           We know of no way, and the Secretary has not
           suggested one, that EMA and Local 98 could
           have forced the Plan to divest itself of the
           note in a timely fashion. We also note that
           ERISA had not been

________________________




                                  1
*Hon. John R. Gibson, United States Circuit Judge for the Eighth
Circuit, sitting by designation.




                               2
enacted at the time of the first transaction. Thus, we conclude
that EMA and Local 98 did not engage in an "act or practice"
prohibited by ERISA and therefore they cannot be held liable by
the Secretary pursuant to section 502(a)(5). On the other hand,
EMA and Local 98 were clearly active parties in the second
transaction and therefore the Secretary has a cause of action
against them on this transaction.


            In the place of this text, the following text is

inserted:
            Without deciding whether there is a theory
            under which parties such as EMA and Local 98
            could be held liable based on a transaction
            of this nature, we affirm the decision of the
            district court with respect to this
            transaction because here the Secretary has
            not presented such a theory to us in a timely
            and adequate manner.



            2. On pages 29-30, the following text is deleted:
            Second, the legislative history of ERISA appears to
            contradict the position advocated by EMA and Local 98.
            The Senate Report stated

                      The bill also makes a party in
            interest who participates in a prohibited
            transaction . . . personally liable for any
            losses sustained by the plan and for any
            profits made through using plan assets. . . .
            This liability is appropriate because in
            these situations often the party in interest
            is a major beneficiary of a fiduciary breach.

            S. Rep. No. 93-383, 93rd Cong., 2d Sess. (1974),
            reprinted in 1974 U.S.C.A.A.N. 4890, 4989.


            3.   On page 30, line 6, "Third" is changed to




                                  3
"Second."   On page 31, line 17, "Fourth" is changed to "Third."
                          /s/ Samuel A. Alito

________________________________
                              Circuit Judge

Dated:   September 8, 1995




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