Right to a Jury Trial in ERISA Cases
By Charles C. Shulman, Esq.
There is a recent trend in some federal cases to allow requests for jury trials for ERISA claims, such as claims for benefits or breach of fiduciary duty claims, even though historically such claims were treated as equitable claims, not entitled to a jury trial. Three district cases allowing jury trials are in the Second Circuit and relate to excessive fee cases. Jury trial verdicts are unpredictable, particularly in complex ERISA fiduciary cases. In light of the possibility of a jury trial in excessive fee cases, increased emphasis and care should be taken in the selection and overseeing of service providers, bids from multiple recordkeepers should be compared and 401(k) plan investment funds should be selected and monitored based on advice of independent financial advisors.
1. Right to Jury Trial in ERISA Legal Claims
The Employee Retirement Income Security Act (ERISA) governing most pension and welfare plans does not explicitly address a plaintiff’s right to a jury trial, and legislative history to ERISA provides no guidance. Federal courts have looked to the Seventh Amendment to the Constitution, which guarantees the right to a jury trial in federal common law cases, but not in equitable cases. Historically, most ERISA claims have been viewed as equitable in nature and not entitled to a jury trial. However, some recent cases have granted jury trial requests for (i) ERISA claims that seek benefits under the plan and (ii) for ERISA claims that seek to make the plan whole for fiduciary breaches.
2. Jury Trials in Legal but Not Equitable Claims
Supreme Court: Right to a Jury Trial is for Legal but Not Equitable Claims. The Supreme Court has addressed the issue of the right to a jury trial for legal but not equitable claims on a number of occasions. For example, in the recent case of Securities and Exchange Commission v. Jarkesy, 603 U.S. 109 (2024), the Court held that that the SEC’s pursuit of civil penalties in securities fraud cases even within an administrative setting, was still considered a legal claim, not an equitable claim, and therefore the defendants could assert their right to a jury trial.
Two-Part Test to Determine if Right to Jury Trial Exists. To determine whether a particular action will resolve legal rights or equitable rights, courts examine both the nature of the issues involved and the remedy sought. See, e.g., Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 42 (1989), holding that Granfinanciera, S.A. had the right to a jury trial when sued by the trustee in bankruptcy (Nordberg) to recover allegedly fraudulent monetary transfer, stated that there are two tests to determine if a jury trial may be allowed: (i) the court compares the statutory action to 18th-century actions brought in the courts of England prior to the merger of the courts of law and equity; and (ii) the court examines the remedy sought and determine whether it is legal or equitable in nature. This case and other recent cases have noted that the second test is utilized more than the first test.
3. Jury Trial for ERISA § 502(a)(1)(B) Denial of Benefits Claims
Cases Denying Jury Trial for ERISA § 502(a)(1)(B) Claims for Benefits under the Plan. Most cases have denied jury trials for an ERISA denial of benefits claims under for ERISA § 502(a)(1)(B), viewing such claims as equitable, similar to enforcing a trust. Under ERISA § 502(a)(1)(B), a civil action may be brought by a participant or beneficiary to recover benefits due under the terms of his plan, to enforce his or her rights under the terms of the plan, or to clarify his or her rights to future benefits under the terms of the plan. For examples of cases that have denied jury trials in § 502(a)(1)(B) denial of benefits claims because they involve primarily equitable claims, see, e.g., Kramer v. American Electric Power Executive Severance Plan, 128 F.4th 739 (6th Cir. 2025) (employee brought action under ERISA § 502(a)(1)(B) for denial of severance benefits under executive severance plan and interference under ERISA; plaintiff asserted constitutional right to a jury trial for ERISA § 502(a)(1)(B) denial of benefits; court held that ERISA claim for denial-of-benefits is equitable in nature; thus, plaintiff was not entitled to a jury trial on ERISA claim for benefits); Graham v. Hartford Life & Accident Ins. Co., 589 F.3d 1345 (10th Cir. 2009) (the 7th Amendment guarantees no right to a jury trial in an ERISA § 502(a)(1)(B) action for benefits because the relief is equitable rather than legal); Wilkins v. Baptist Healthcare Sys. Inc., 150 F.3d 609, 616 (6th Cir. 1998) (former employee brought ERISA claim against employer and benefit plan administrator, alleging that the administrator’s denial of disability benefits violated ERISA; court held that a claim for denial of benefits was not a case for money damages and therefore plaintiff was not entitled to a jury trial); Biggers v. Wittek Industries, Inc., 4 F.3d 291 (4th Cir. 1993) (claim for benefits under an ERISA welfare plan was covered by ERISA, and because ERISA preempts his common law contract claim, the claim should have been tried by the court under the principles of ERISA); Bair v. General Motors Corp., 895 F.2d 1094 (6th Cir. 1990) (former employee sued former employer under ERISA, seeking special early retirement benefit; court rejected appellant’s argument that he was entitled to a jury merely because issues of contract law are involved in his claim).
Some Cases Allow Jury Trials for ERISA § 502(a)(1)(B) Denial of Benefits Claims. Some cases have held that jury trial requests were allowed even in claims for benefits under for ERISA § 502(a)(1)(B), as they were held to involve legal claims, like claims for damages. See, e.g., Cox v. Keystone Carbon Co., 861 F.2d 390 (3d Cir.1988) (court acknowledged the difference between the relief provided ERISA § 502(a)(1)(B), which is “legal,” and the relief provided ERISA § 502(a)(3)(A) & (B), which is “equitable,” citing Tull v. United States, 481 U.S. 412 (1987); remanded to district court to determine whether the § 502(a)(1)(B) claim was presented to it and if so, whether he was entitled to a jury trial thereunder); Rhodes v. Piggly Wiggly Alabama Distributing Co., Inc., 741 F. Supp. 1542 (N.D. Ala. 1990) (an action under ERISA § 502(a)(1) is legal in nature and there is a 7th Amendment right to jury trial).
4. Fiduciary Breach Claims under ERISA § 502(a)(2) are Held by Most Courts to be Equitable Claims Not Entitled to a Jury Trial
With regard to ERISA fiduciary claims under ERISA § 502(a)(2) to remedy fiduciary breaches under ERISA § 409(a), most courts have held that ERISA fiduciary claims are equitable in nature and are not entitled to a jury trial.See, e.g., Acument Global Technologies, Inc.. v. Towers Watson & Co., 998 F. Supp. 2d 111 (S.D.N.Y. 2014) (rejecting jury demand in ERISA fiduciary breach case because the remedy sought was the classic remedy against a fiduciary, namely, a surcharge to repair the damage his breach of duty inflicted upon the corpus that the fiduciary was charged to protect, which is an equitable claim); Bauer-Ramazani v. Teachers Insurance and Annuity Association of America-College Retirement and Equities Fund, No. 1:09–CV–190, 2013 WL 6189802 (D. Vermont 2013) (granting motion to strike jury demand in ERISA claim for breach of fiduciary duty, because the remedy plaintiffs seek under ERISA, the value of the use of the plan assets and disgorgement of any investment profits made through the use of plaintiffs’ funds, are equitable in nature); Carver v. Bank of New York Mellon, No. 15-CV-10180 (JPO), 2017 WL 1208598 (S.D.N.Y. 2017) (court concludes that the remedy sought by plaintiffs for defendants’ alleged breach of fiduciary duty is equitable in nature; defendants’ motion to strike plaintiffs’ demand for a jury trial was therefore granted); Divane v. Northwestern University, 953 F.3d 980 (7th Cir. 2020), vacated on other grounds, 142 S. Ct. 737 (2022) (court stated there would be no right to jury trial for fiduciary claim); In Re First American Corp. ERISA Litigation, No. SACV 07-01357-JVS (RNBx), 2009 WL 536254 (C.D. Cal. 2009) (overwhelming weight of authority in the federal courts holds that actions under ERISA § 502(a)(2) by participant, beneficiaries or fiduciaries to remedy alleged fiduciary violations of ERISA § 409(a) are equitable in nature and have no 7th Amendment jury trial right); Harmon v. Shell Oil Co., No. 3:20-cv-00021, 2023 WL 2474503 (S.D. Tex. Mar. 13, 2023) (given the equitable nature of the claims and relief that plaintiffs seek, court denied jury request).
5. Several Recent District Court Cases in the Second Circuit Have Allowed Jury Trials even for Fiduciary Breach Claims under ERISA § 502(a)(2)
Three recent district court decisions in the Second Circuit have granted jury trials in ERISA fiduciary breach cases.
a. Jury Trial Allowed in Garthwait v. Eversource Energy Service Company (D. Conn.) and rather than go to Jury Trial, Defendants Settled for $15 Million. In Garthwait v. Eversource Energy Service Company, No. 3:20-CV-00902, 2022 WL 17484817 (JCH) (D. Conn. Dec. 7, 2022), the court allowed a jury trial for the plaintiffs’ claim for Eversource to restore (“make good”) any losses caused by breaches of fiduciary duty related to the company’s 401(k) plan. In that case, participants in the 401(k) plan alleged breach of fiduciary duty by allowing underperforming investments in the choice of funds. The court held that the make-good claim was a legal remedy rather than an equitable remedy because it sought monetary damages to compensate for the losses caused by the alleged breaches, and therefore plaintiffs request for a jury trial with respect to the make-good claims was valid. The case was subsequently prepared for a jury trial scheduled for April 2023, but as a result of the risks of a jury trial the parties reached a $15 million settlement in September, 2023.
b. Jury Trial Allowed in Vellali v. Yale University (D. Conn.) but Jury Acquitted on Basis of “Could Have” Standard; Plaintiffs Appealing to Second Circuit. In Vellali v. Yale University, 662 F.Supp.3d 238 (D. Conn. Mar. 17, 2023), a class of participants in Yale University’s 403(b) Retirement Account Plan brought suit under ERISA § 502(a)(2) against the plan fiduciaries for breach of fiduciary duties and other ERISA claims in connection with alleged excessive recordkeeping and administrative fees, noting that the plan used multiple recordkeepers, and selected an imprudent choice of investment funds. The plaintiffs made a jury request. The district court stated that the remedy is legal in nature since they seek to recover damages out of the defendant’s assets rather than to recover specifically identifiable funds, and the court therefore held that the plaintiffs have the right to a jury trial in this case on their claims for money damages.
The jury in the Vellali v. Yale University case found in June 2023 that Yale University fiduciaries had breached their fiduciary duty of prudence by allowing unreasonable recordkeeping and administrative fees, but that the plaintiffs didn’t prove any resulting damages since Yale University demonstrated that a prudent fiduciary “could have” made the same decisions as to recordkeeping and administrative fees. The jury also sided with Yale University on the appropriateness of investment monitoring and share class selection. The plaintiffs appealed to the Second Circuit claiming that the jury instructions in the trial did not adequately guide the jury on how to assess damages, specifically regarding the “could have” versus “would have” standard for determining if a prudent fiduciary would have made the same decisions as the defendants. The appeal is pending.
c. Jury Trial Allowed in Khan v. Board of Directors of Pentegra Defined Contribution Plan (S.D.N.Y.) and Jury Awarded $38 million for Unreasonable Recordkeeping and Administrative Fees. In Khan v. Board of Directors of Pentegra Defined Contribution Plan, No. 20-CV-07561 (PMH), 2023 WL 6237862 (S.D.N.Y. Sept. 26, 2023), participants in the Pentegra Defined Contribution Plan for Financial Institutions (a multiple employer plan) brought suit under ERISA § 502(a)(2) alleging that plan fiduciaries at Pentegra and the Board breached their ERISA fiduciary duties by allowing unreasonable recordkeeping and administrative fees. The plaintiffs amended their claim to request a jury trial. The Southern District of New York in the 2023 case found that the ERISA § 502(a)(2) claim against the fiduciaries involves legal and equitable claims, and therefore held that the case should be bifurcated with the claim for money damages being tried before a jury, and the remaining equitable claims and prohibited transaction claims should be tried before the court.
On April 23, 2025, a jury in the U.S. District Court for the Southern District of New York rendered a unanimous verdict in Khan v. Board of Directors of Pentegra Defined Contribution Plan, that the defendants breached their fiduciary duties under ERISA in connection with administration and fees charged for participation in the Pentegra pooled 401(k) plan, and as a result, the jury awarded the plaintiffs damages exceeding $38 million. A court decision regarding the equitable and prohibited transaction claims had not yet been issued, and according to a May 2, 2025 S.D.N.Y. court order, the parties in Khan v. Board of Directors of Pentegra Defined Contribution Plan, have reached a settlement in principle for the remaining claims.
6. Points to Consider in Light of Possibility of Jury Trials for Excessive Fee Cases
● The intricacies of ERISA excessive fee cases make jury trials particularly unpredictable.
● In light of the possibility of a jury trial in excessive fee cases, increased emphasis and care should be taken in the selection and overseeing of service providers and in reviewing the fee structures from time to time.
● Bids from multiple recordkeepers should be compared.
● 401(k) plan investment funds should be selected and monitored based on advice of independent financial advisors, and the funds’ returns and risks should be benchmarked.
● Recordkeepers with a relationship with the plan sponsor should be avoided.
● It would be interesting to see if this trend to allow jury trials in ERISA fiduciary excessive fee cases spreads beyond the Second Circuit.
