## Facts

- A multiple-employer trust, Union Insurance Trust (UIT), enabled small employers to obtain group health insurance for employees through a blanket policy issued to UIT.
- Employers subscribed to UIT to provide health coverage to their employees (and, where applicable, dependents) and funded coverage through premiums/contributions.
- The Secretary of Labor sued UIT’s trustees and related entities, alleging they acted as ERISA fiduciaries and breached fiduciary duties under ERISA Title I, Part 4.
- The district court dismissed for lack of subject-matter jurisdiction, concluding there were no ERISA “employee benefit plans,” and a circuit panel affirmed.
- The Eleventh Circuit granted rehearing en banc to determine whether the UIT arrangements involved ERISA-covered plans and thus supported federal jurisdiction.

## Issues

1. Whether employers’ arrangements to provide health benefits through UIT constituted “employee welfare benefit plans” under ERISA.
2. Whether the existence (or nonexistence) of ERISA plans determined federal subject-matter jurisdiction over the Secretary’s fiduciary-duty claims under ERISA § 502(a).

## Decision

- The en banc Eleventh Circuit reversed the dismissal and remanded.
- The court held that subscribing employers’ arrangements to provide health benefits through UIT constituted ERISA employee welfare benefit plans.
- Because ERISA plans were present, the district court had subject-matter jurisdiction over the Secretary’s ERISA fiduciary-breach action.

## Legal Principles

- An ERISA “employee welfare benefit plan” may exist even without a formal written plan; the inquiry turns on surrounding circumstances.
- A plan exists if a reasonable person can ascertain: (1) intended benefits, (2) a class of beneficiaries, (3) the source of financing, and (4) procedures for receiving benefits.
- The mere purchase of insurance is not dispositive; the focus is whether an employer has established or maintained an ongoing plan, fund, or program to provide covered benefits.
- Multi-employer trust participation does not categorically fall outside ERISA; courts must apply a functional, fact-dependent analysis rather than rely on labels or the insurance/trust form.
- ERISA fiduciary duties and ERISA-based federal jurisdiction depend on the existence of an ERISA-defined employee benefit plan.

## Conclusion

The court held that employers’ use of a multiple-employer insurance trust to provide health coverage can constitute ERISA welfare benefit plans when the benefits, beneficiaries, funding, and benefit-claim procedures are reasonably ascertainable, thereby supporting federal jurisdiction over ERISA fiduciary-duty claims.


Donovan v. Dillingham, 688 F.2d 1367 (11th Cir. 1982) (en banc)