Third Circuit Lacks Jurisdiction Over Interlocutory Appeal of Order Finding ERISA Governs DuPont Pension Trust

In Wright v. Elton Corporation, et al., No. 20-3343, 2021 WL 5822306 (3d Cir. Dec. 7, 2021), the Third Circuit dismissed for lack of jurisdiction the interlocutory appeal of First Republic Trust Company of Delaware, LLC (the “Trustee”), wherein it appeals an order denying a motion to clarify a ruling that ERISA governs the Mary Chichester duPont Clark Employee Pension Trust (the “Trust”). The Trust was created to provide retirement benefits to household employees of the duPont family. Plaintiffs are the grandchildren of the Trust’s Settlor, who sued the Trustee and other Trust administrators alleging that they violated ERISA by improperly operating the Trust and mishandling the Trust’s assets.

The district court bifurcated the case to determine first whether ERISA governed the Trust. The parties filed cross-motions for summary judgment on this issue and the district court held that ERISA governed the Trust because, among other things, “there is a documented history of a multi-decade effort to provide pension benefits to the family’s long-term domestic employees.” The Trustee moved for clarification of the order as to whether it requires the Trustees to currently operate and manage the Trust in accordance with ERISA’s requirements. The district court denied the motion because it found that the Trustee was asking the court to revisit its previous rulings and attempting to abdicate any responsibility to operate the Trust in compliance with the law. The Trustees appealed this clarification order.

The Third Circuit found that it did not have jurisdiction because the order does not grant an injunction. An order grants an injunction when it is directed to a party, enforceable by contempt, and designed to accord or protect some or all of the substantive relief sought by a complaint in more than a temporary fashion. Here, the order does not instruct the Trustee regarding what it is supposed to do. The order also does not modify an injunction because the initial order was not an injunction. The parties only sought a decree concerning the governing law. A decree stating what law applies is not an injunction. The district court has not yet decided whether the defendants violated ERISA. Even if the initial order was an injunction, the clarification order does not modify it. The court dismissed the appeal of the district court’s clarification order.