Equity, ERISA, and the Surcharge Remedy

Today I filed an amicus brief supporting a grant of certiorari in Aldridge v. Regions Bank. At issue is a circuit split about whether surcharge counts as “appropriate equitable relief” under ERISA. The yes answer is based on surcharge being a traditional equitable remedy related to an accounting; the no answer is based on surcharge being monetary recovery for losses, which looks like damages. I think the yes answer is right, even though the opinions on the other side of the split are by Judge Richardson (4th) and Judge Murphy (6th).

Here is the introduction to the argument:

Over the last three decades, this Court has had about a dozen cases interpreting “equitable relief” under various provisions of the Employee Retirement Income Security Act of 1974 (ERISA). It is time for another.

There is confusion in the lower courts about whether this Court really meant what it said in CIGNA Corp. v. Amara, 563 U.S. 421 (2011), namely, that “surcharge” is an equitable remedy available under ERISA. That confusion, caused in part by tensions in this Court’s precedents, has now generated a sharp circuit split. The petition in this case is an ideal vehicle to resolve the split and clear up the confusion. The Court should reaffirm that surcharge is an equitable remedy available under 29 U.S.C. § 1132(a)(3).

This brief will concisely make two points. First, surcharge is an equitable remedy, a position adopted by this Court previously but ignored in practice by several Circuits. Second, if the Court grants the petition for certiorari with respect to the first question presented, it should also take up the second question presented. Amicus takes no position on the substantive merits of this case, i.e., whether there was in fact a violation of ERISA or a breach of contract.

And here’s a point that some readers may find interesting about how the Supreme Court’s “disfavored precedent” (to use the term of Curt Bradley and Tara Grove) can linger on, zombie-like, in circuit court cases.

Indeed, this is one instance of a recurring precedential problem that only this Court can solve. Here’s the pattern: Case A, a decision of this Court, takes a particular path, and that decision then gets encased in circuit precedent. Then along comes Case B, which corrects Case A in some respect and points in a different direction. But because Case B does so delicately, offering a harmonious rather than repudiatory reading of Case A, some of the lower courts persist in following their prior precedent. The pattern recurs in a number of contexts. See, e.g., Curtis Bradley & Tara Leigh Grove, Disfavored Supreme Court Precedent in the Lower Federal Courts, 111 Va. L. Rev. 1353, 1385–88 (2025) (discussing Lemon v. Kurtzman, 403 U.S. 602 (1971)); Bray, Equity, Law, and the Seventh Amendment, supra, at 478–82 (discussing Chauffeurs Local No. 391 v. Terry, 494 U.S. 558 (1990)). The older case, mistaken in some respect, gets locked into circuit precedent, and dislodging it requires the explicit statement of this Court. That is exactly what happened in the case below. See Aldridge, 144 F.4th at 849 (relying on circuit precedent from a decade prior to Amara and stating that “[w]e must follow [it] until the Supreme Court or our en banc court overturns it”).

You can read the full brief here (it’s short!). And a big thank you to Mark Boyko of Bailey & Glasser for assistance.

The cert petition, by the UVA Supreme Court Litigation Clinic, is available here.