author: PATRICK E. HIGGINBOTHAM, Circuit Judge:

text:
    Teresa GONZALEZ, Plaintiff-Appellant v. UNITED STATES of America; John Does A-Z, Defendants-Appellees
    No. 16-60062
    United States Court of Appeals, Fifth Circuit.
    FILED March 22, 2017

      Alben Norris Hopkins, Jr., Hopkins, Barvie & Hopkins, P.L.L.C., Gulfport, MS, for Plaintiff-Appellant.
    Cynthia Lynn Eldridge, Assistant U.S. Attorney, U.S. Attorney’s Office, Gulfport, MS, for Defendants-Appellees.
    Before HIGGINBOTHAM, JONES, and HAYNES, Circuit Judges.
   PATRICK E. HIGGINBOTHAM, Circuit Judge:

Teresa Gonzalez was injured while riding her bicycle over a ramp at De Soto National Forest. She sued various United States officials under the Federal Tort Claims Act (“FTCA”), 28 U.S.C. §§ 2671-2680, alleging they failed to inspect and maintain the bicycle trails, and failed to warn her of the hazard. The United States moved to dismiss, arguing that the FTCA’s “discretionary function exception” barred Gonzalez’s claims. The district court granted the motion. We AFFIRM.

I.

On July 28, 2012, Teresa Gonzalez and Robert Reville, Jr., went to the De Soto National Forest to ride their bicycles at the Bethel Bicycle Trails, which included the Couch Loop Trail. Before they began riding, Gonzalez did not look at the bulletin board at the park’s entrance, which contained a sign stating that the Couch Loop Trail was closed. They nevertheless embarked on the Couch Loop Trail. At some point, they took an “alternate route” to the left of the main trail that led to obstacles including a teeter-totter and a ramp. Neither attempted to ride over the teeter-totter, but both decided to ride over the ramp. Gonzalez had never jumped off a ramp before, and when she tried to do so, she fell off and suffered serious injuries.

Gonzalez assumed that the ramp' was part of the trail and built by the Forest Service. In fact, the ramp was built illegally by Gulf Coast Bicycle Club members, without the knowledge of the United States Forest Service (“USFS”). The USFS employees were not' aware of the ramp’s existence before Gonzalez’s accident. They were, however, aware of an unauthorized bridge further down the trail, which is why the Couch Loop Trail was closed on the day of Gonzalez’s accident.

USFS recreational technician Charles Grice had posted a sign at the trailhead bulletin board that stated the trail was closed, and also flagged the bridge area with boards, signs, and ribbons. The sign at the trailhead bulletin board stated: “Couch Trail CLOSED,” and in smaller type, “Bridge Out.” The sign was on an 8 ⅜* by 11" sheet of paper. Gonzalez claims that neither she nor Reville saw any signs, and that she would have obeyed any warning sign she 'saw.

De Soto National Forest is about 382,-000 acres. In 2012, Ronald Smith was the De Soto National Forest District Ranger, the highest ranking officer of a district. Two technicians were ' responsible for maintaining and inspecting the Bethel Bicycle Trails, full-time technician Charles Grice, and part-time, technician, Anthony Bond. Grice testified that-inspection and maintenance of the trails included identifying hazards, such as trees, and performing repair work. He spot-checked the trail and checked it when people called. If Grice found an unauthorized structure, he reported it to the ranger. He stated that he and Bond “bush hog the trail pretty much every year,” which includes clearing and cleaning the trail. Grice did not know whether he had bush hogged the teeter-totter and ramp area in 2012. The last time Grice remembered inspecting the Couch Loop Trail before Gonzalez’s accident was when he was inspecting a trail contractor’s work, however he could not remember when that was. Other than checking for unsafe structures or trees and bush hogging, there are no other scheduled inspections of the trail. Since January 2012, Grice was also responsible for posting any warning signs at the trailhead. Grice stated that no one instructed him about the placement of trail closure notices, and that “[w]e just put them on the bulletin board at the trailhead areas.” Grice and Bond were not allowed to post warning signs or close a trail without Ranger Smith’s authority.

A number of laws, regulations and policies affect the USFS, including the following that Gonzalez highlights in this appeal: (1) The Forest Service Manual — FSM-2300 Recreational, Wilderness, and Related Resource Management (“the Manual”); (2) The Forest Service Handbook — FSH 2309.18 — Trails Management Handbook (“the Handbook”); and (3) the Forest Service-EM7100-15 Sign and Poster Guidelines for the Forest Service (“Sign and Poster Guidelines”).

Gonzalez filed a complaint against the United States on February 21, 2014, asserting jurisdiction under 28 U.S.C. § 1346(B)(1). She advanced several negligence theories, essentially alleging that the United States failed to keep its premises safe, failed to perform inspections, and failed to warn of a dangerous condition. The United States moved to dismiss for lack of subject matter jurisdiction, arguing that the discretionary function exception to the FTCA’s waiver of sovereign immunity applied. It alternatively moved for summary judgment “because no USFS employee engaged in any negligent act or omission for which the United States may be held liable to the Plaintiff under the FTCA.” The district court granted the motion to dismiss based on the FTCA discretionary functions exception, not reaching the government’s alternative argument. Gonzalez appealed.

II.

“We review the district court’s dismissal for lack of subject-matter jurisdiction over [a plaintiffs] FTCA claim de novo.” “Lack of subject-matter jurisdiction may be found in the complaint alone, the complaint supplemented by the undisputed facts as evidenced in the record, or the complaint supplemented by the undisputed facts plus the court’s resolution of the disputed facts.” The district court here based its conclusion on the complaint and undisputed facts.

III.

The United States enjoys sovereign immunity from suit, meaning it cannot be sued without consent. “The FTCA is recognized as providing a waiver of sovereign immunity and provides the sole basis of recovery for tort claims against the United States.” This waiver, however, “is subject to several exceptions.” The exception relevant here is the “discretionary function exception,” which “preserves the federal government’s immunity ... when an employee’s acts involve the exercise of judgment or choice.” The exception is found in 28 U.S.C. § 2680(a): Any claim based upon an act or omission of an employee of the Government, exercising due care, in the execution of a statute of regulation, whether or not such statute or regulation be valid, or based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of the Government, whether or not the discretion involved be abused.

The Supreme Court has explained, “[t]he exception covers only acts' that are discretionary in nature, acts that ‘involv[e] an element of judgment or choice,’ [ ] and ‘it is the nature of the conduct, rather than the status of the actor’ that governs whether the exception applies.” “The basis for the discretionary function exception was Congress’ desire to ‘prevent judicial “second-guessing” of. legislative and administrative decisions grounded in social, economic, and political policy through the medium of an action in tort.’ ”

A two-prong test determines whether the exception applies: (1) “the conduct must be a ‘matter of choice for the acting employee[;]’ ” and (2) the “judgment [must be] of the kind that the discretionary function exception was designed to shield.” Both prongs must be met for the exception to apply. With respect to the first prong, “[i]f a statute, regulation, or policy leaves it to a federal agency to determine when and how to take action, the agency is not bound to act in a particular manner and the exercise of its authority is discretionary.” On the contrary, “[t]he requirement of judgment or choice is not satisfied if a ‘federal statute, regulation, or policy specifically prescribes a course of action for an employee to follow,’ because ‘the employee has no rightful option but to adhere to the directive.’ ” Regarding the second prong, the court “consider[s] whether the actions taken are ‘susceptible to policy analysis.’” “[T]he proper inquiry ... is not whether [the official] in fact engaged in a policy analysis when reaching his decision but instead whether his decision was ‘susceptible to policy analysis.’ ” In performing the two-prong test, “the question of whether the government was negligent is irrelevant.”

IV.

The FTCA’s discretionary function exception bars Gonzalez’s claims. The district court categorized Gonzalez’s claims into two groups: (1) the alleged failures to inspect and maintain the trails, and (2) the alleged failures to warn. We adopt the same useful organization.

Gonzalez alleges the government employees failed to meet a number of provisions from the Manual and Handbook. She argues that such provisions prescribe a course of action and contends that “routine property maintenance decisions are not susceptible to the kind of policy analysis shielded by the discretionary function [exception].” Gonzalez compares the government’s actions to those of a business operator who makes decisions about premises safety. The Government responds that Ranger Smith and the other USFS officials had discretion in maintaining and inspecting their trails. The Government argues that no specific law or policy proscribed how employees should inspect and maintain the trails, and that the Manual and Handbook offer “general guidance.” The Government urges, “[t]he determining factor is whether the challenged actions are ‘grounded in the policy of the regulatory regime,’ ” and concludes that “trail inspection and maintenance are part of the essence of the regulatory regime set forth in the Manual, the Handbook, and the other applicable regulations.” The Government asserts that the USFS balanced resources as per USFS policy, and followed the recommendations for maintaining bicycle trails.

In order to determine whether an official’s conduct was discretionary, we must first define that conduct. Gonzalez generally suggests that the conduct at issue is some version of “failing to inspect the trails as required." The Government, in turn, describes Gonzalez as arguing “that USFS failed to perform required inspections and maintenance of the Bethel Bicycle Trails” and “further ... that the National Quality Standards for Trails mandate hazard-free trails.” To different extents, each of the above framings assumes that there were clearly prescribed requirements — an inquiry for the first prong of the discretionary function test. Moreover, Gonzalez at times suggests that Grice and Bond failed altogether to inspect the trails — but the record belies this assertion.

The Eleventh Circuit in Autery v. United States confronted a similar gateway framing issue. In that case, after a black locust tree in the Great Smokey Mountain National Park fell on a car, the injured passenger and estate of a killed passenger brought an FTCA claim against the United States. In its discretionary function analysis, “[t]he government argue[d] that the conduct to be evaluated [was] ‘the Park Service’s decision to establish and implement a tree inspection program. Plaintiffs, on the other hand, contended] that ‘the conduct at issue [was] the park’s failure to carry out the mandates of its then existing policy of identifying and eliminating known hazardous trees.’ ” The Autery court rejected both descriptions. It explained that “[t]he tree inspection program was designed to identify which trees were hazardous. Whether park personnel had discretion in executing that plan is the relevant issue.” “[T]he relevant inquiry here,” the Autery Court concluded, “is whether controlling statutes, regulations and administrative policies mandated that the Park Service inspect for hazardous trees in a specific manner.” Similarly, the relevant inquiry in the present case is whether the controlling policies mandated the USFS to inspect and maintain the trails in a specific manner.

We find that they did not. Beginning with the first prong of the discretionary function exception test, the relevant Manual and Handbook provisions contemplate an element of choice as to how USFS employees inspect and maintain the trails. For example, Paragraph 2353.12 in the Manual instructs to “[m]anage each trail to meet the [trail management objectives] identified for that trail, based on applicable land management plan direction, travel management decisions, trail-specific decisions, and other related direction, as well as management priorities and available resources.” This language contains the direction to “meet” the identified objectives, but gives room for choice based on the evaluation of various factors. Moreover, although the objectives at 2353.02 list specific goals, they do not prescribe a certain course employees must take to reach those goals. In this way, the “provisions ... contain generalized, precatory, or aspirational language that is too general to prescribe a specific course of action for an agency or employee to follow.”

The Handbook, too, contemplates that employees have some discretion in maintaining the trails. For example, the exhibit in Chapter 10, Paragraph 18, for “trail operation and maintenance considerations” states that the considerations are “general guidelines for developing trail prescriptions and managing, operating, and maintaining National Forest System trails.” It further states that “[t]he considerations are a starting point and likely will need to be adapted to reflect local financial capability and other circumstances.” General guidelines for maintaining a trail encompass “acts that are discretionary in nature, acts that ‘involv[e] an element of judgment or choice.’” Here, because the “policy leaves it to a federal agency to determine when and how to take action, the agency is not bound to act in a particular manner and the exercise of its authority is discretionary.”

Gonzalez emphasizes one of the critical “National Quality Standards for Trails” in the Handbook that states: “hazards do not exist on or along the trail.” Gonzalez asserts, “[i]t is inconceivable that a Critical National Quality Standard to inspect the trails to ensure that hazards do not exist and to ‘prevent immediate and permanent injury to persons or property’ is a duty left up to the choice of low level Forestry Service personnel.” In response, the Government points to the footnote associated with the Critical National Quality Standards, which states “[i]f it cannot be met, action must be taken as soon as practicable to correct or mitigate the problem.” This language contemplates that the standard may not be met, which cuts against Gonzalez!s claim that the standard represents a mandatory prescription. Moreover, even if the standard that “hazards do not exist on or along the trail” is mandatory, the standard does not dictate how officials must meet that standard — which is what the challenged conduct concerns.

Gonzalez contends, “[inspecting the bicycle trail does not mean bush hogging some portion of the trail with easy access to a tractor on occasion.” But even setting aside Grice’s testimony to the contrary, Gonzalez cites to no provision prohibiting this understanding, nor prescribing a different understanding, of how the trails should be inspected. That the policies leave open the question of how to inspect the trails is evidence of choice. Gonzalez also argues that the officials were not familiar with the policies, but in doing so shifts the focus away from the discretionary function test and toward the merits of her negligence claims. Indeed, Grice testified he did not know what the National Quality Standards for trails were, and that he never read the “Trails Management Handbook, Trail Planning” document. Gonzalez emphasizes that Bond could not remember ever inspecting the area of the Couch Loop Trail where the accident occurred, nor did he recall seeing the regulations. Gonzalez also points out that Ranger Smith “had never read the Forestry Service Regulations.” Gonzalez asserts, “[tjhere is no ‘room for choice’ if you have no idea what the standards are for performing maintenance and inspections to begin with.” While the officials’ lack of familiarity with the policies may be strong evidence of a breached duty, such evidence does not affect the inquiry at hand: whether the challenged actions contained an element of judgment. Gonzalez’s arguments in this respect better inform the merits of her underlying claims, rather than whether the discretionary function exception applies. Based on the applicable policies, “there was ‘room for choice’ in making the allegedly negligent decision” to not inspect and maintain the trails in a certain way. At most, the USFS officials abused their discretion, but as the Court in Katrina Canal Breaches reminds, such “abuse [is] explicitly immunized by the [discretionary function exception].”

The challenged conduct also meets the second prong of the discretionary function exception test, as the manner in which the USFS officials inspected and maintained the trails was susceptible to policy considerations. Gonzalez asserts that, “[t]here should be little balance when it comes to the safety of the patrons versus the natural environment under the circumstances of this case. Certainly in this instance, removing the hazards and inspecting for additional hazards is reasonable and inexpensive.” However, this argument concerns whether the officials best balanced the policy considerations, when the inquiry is whether the challenged actions were susceptible to policy considerations. Indeed, the purpose of the discretionary function exception is “to prevent judicial second-guessing.”

In Gibson v. United States, this Court held that the discretionary function exception was not met, because the Federal Emergency Management Agency’s (“FEMA”) conduct in how to provide customers access to their trailers was not susceptible to policy analysis. In Gibson, the plaintiff “was at a FEMA storage site ... inspecting trailers that were to be sold at auction,” when he was injured while trying to exit one. Gibson brought suit under the FTCA, alleging a number of claims related to FEMA’s policies regarding access to the trailers. The government argued the discretionary function exception applied. Bypassing a determination on the first prong of the test, this Court held “that FEMA’s decision about how customers would enter and exit the trailers was not the type of judgment the discretionary function exception was designed to protect.” The Court compared FEMA’s trailer operation to that of a commercial business, and found that decisions regarding trailer access concerned “ ‘a mundane, administrative, garden-variety, housekeeping problem that is about as far removed from the policies applicable to ... FEMA’s[ ] mission as it is possible to get.’ ”

Gonzalez cites extensively to Gibson, while the Government attempts to distinguish it by arguing that in Gibson, the United States was acting as a commercial business, but in the present case it is operating wilderness. The Government’s suggestion that “wilderness cases” are distinct has merit. As the Gibson Court pointed out, “[r]ather differently, when the Government acts as landowner of wilderness, certain kinds of maintenance decisions have been found to contain multiple policy considerations.” The Gibson Court cited to Theriot v. United States; which concerned how the United States Army Corps of Engineers “was to notify the public of the existence of a sill,” and Hix v. U.S. Army Corps, of Engineers, which concerned how the government was to “replace warning signs near jetties in Galveston.” Unlike those decisions, which concerned public safety (Hix), dangerous objects, vessel traffic, and economics {Theriot), among others, in Gibson, “the Government operated as a commercial business and welcomed customers to its site as if it were managing a trailer showroom.”

Here, the government acts more like the manager of a wilderness area than the operator of a commercial business. Decisions about how to maintain bicycle trails running through 382,000 acres of land with only two recreation technicians seem to invite, if not require, “safety, financial, and other feasibility concerns.” Such decisions implicate resource allocation, wilderness considerations, and public safety; in other words, they are “administrative decisions grounded in social, economic, and political policy.”

Gaubert teaches that “[flor a complaint to survive a motion to dismiss, it must allege facts which would support a finding that the challenged actions are not the kind of conduct that can be said to be grounded in the policy of the regulatory regime.” The challenged actions here are grounded in USFS policy. Paragraph 2353.03 of the Manual states, for example: “Emphasize long-term cost effectiveness and need when developing or rehabilitating trails,” and “Provide a trail system that is environmentally, socially, and financially sustainable.” The decisions about how to inspect and maintain the bicycle trails are susceptible to policy considerations so as to satisfy the second prong of the discretionary function exception test.

Gonzalez’s failure to warn claims are also barred by the discretionary function exception. Gonzalez argues that the government had a duty to warn her about the ramp, and that, “[t]he Forestry Service Regulation do not give a choice on how to mark a trail.” Gonzalez points to a bevy of provisions describing sign standards, and ultimately argues, “the 8 ⅜ x 11 sheet of copy paper with small black letters posted amongst other cluttered papers was not a discretionary option for those in charge of maintenance and inspection.” Gonzalez avers the government’s “failure to adequately warn and notify [Gonzalez] of the trail closure involves considerations of safety, not public policy.” The Government responds by pointing out that the Couch Loop Trail was closed due to the.bridge, not the ramp. The Government insists that Grice’s notice on the trailhead followed Guidelines recommendations, and reiterates the district court’s conclusion that “the USFS could not possibly warn of a hazard it did not create and of which it had no knowledge.” The Government further contends that the decision of how to mark a trail as closed is “grounded in social, economic, and public policy,” such as aesthetic and recreation factors, which were similar to the policy considerations in Katrina Canal Breaches.

Once again, we must first define the challenged conduct. Gonzalez alleges the USFS “failfed] to adequately warn of a known condition and further to warn, based upon the passage of time, of a dangerous condition imputed to the Appellee which caused the Appellant’s injuries.” The Government characterizes the challenged conduct as “how to mark the trail as closed.” Notably, the district' court found that “the record reflects that the USFS was unaware of the ramp ... until after this incident, such that the ramp did not constitute a ‘known hazard.’ ” It further suggested that the USFS did not create the ramp. Because “[fjactual findings are reviewed for clear error,” and because the district court’s findings are grounded in the record, this Court accepts the findings that the USFS did not create the ramp, nor know about the ramp. Accordingly, the challenged conduct is the manner in which the trail was marked as closed based on a hazard not known, nor created, by the USFS. Given this, Gonzalez has not pointed to a policy that “specifically prescribes a course of action.” Indeed, it is difficult to conceive of a provision mandating the USFS take specific action to warn the public about unknown hazards.

But even if we do not accept the district court’s findings with respect to the USFS having no knowledge of the bridge, the discretionary function exception would still apply. The USFS’s decision to close the Couch Loop Trail in the way it did, i.e., by posting the 8 ⅛ x 11" notice at the trail-head, “involve[ed] ‘an element of judgment or choice.’ ” “If a statute, regulation, or policy leaves it to a federal agency or employee to determine when and how to take action, the agency is not bound to act in a particular manner and the exercise of its authority is discretionary.” The Sign and Poster Guidelines grant discretion in posting closure signs. For example, Chapter 1.3, .“Principles,” provides, “[s]igns and posters shall be designed, installed, positioned, and maintained to” “[f]ulfíll a legal requirement or an important need,” “[cjommand attention, “[cjonvey a clear, simple meaning,” “[cjommand respect,” and “[g]ive adequate time for proper response.” Although one could argue these points are mandatory, they do not prescribe how to fulfill them. Moreover, Chapter 5.1, the introduction to the “Trail Signing” chapter, states, “[t]his chapter provides standards and guidelines for the use of signs and posters on National Forest System trails.”

Still, other provisions in the Sign and Poster Guidelines contain specific instructions. For example, Chapter 1.7.1 indicates designs, colors and “word messages” for signs and posters. It states, “[standard colors have been established for specific purposes and types of signs. It is critical to use the colors specified consistently and only for these purposes to facilitate sign recognition and user response.” That being said, Table 5-1 in Chapter 5 blunts the force of Chapter 1.7.1’s directive when it gives a “selection guide for materials, colors, and finishes for trail signs, markers, and supports,” with several options based on various factors. Reviewing the provisions cumulatively, we detect the requisite element of discretion for the closure sign at issue.

Gonzalez points to Chapter 13.2.4, Sign Placement and Mounting,, directing to “[p]ost signs conspicuously. Avoid cluttering signs in one location or where objects may obscure them.” But even if this provision can be said to prescribe a specific course of action, Chapter 13.2, discussing “Safety Signs,” notes that “[tjhese do not include safety signs designed for roads, recreation sites, [or] trails.” Although Gonzalez argues “[t]he sign posted by Agent Grice does not meet the standards,” she does not explain how. Gonzalez avers, “Agent Grice acknowledged that the sign he posted did not meet the Forestry Standards,” but does not provide support. Gonzalez asserts, “[t]he Forestry Service Regulation^] ... provide the exact sign, color and instructions for closure of trails and notification of dangerous conditions to patrons on the government’s premise.” However, Gonzalez fails to specify what provisions regarding sign, color, and instructions the officials had no choice but to. follow with respect to creating or posting a closure sign. In short, Gonzalez fails to identify specific provisions that mandate an approach to creating or placing closure signs in these circumstances.

“The next question is whether the government’s decision as to the appropriate action for [marking the trail as closed] was based on considerations of public policy.” We find it was. For instance, Chapter 5.1 of the Sign and Poster Guidelines states, in relevant part, to select signs to consistently provide: “Route identification,” “Guidance and distance [information],” “Safety features, such as snow shelters and resorts,” “Route reassurance and confirmation,” “User safety: warnings of known hazards,” “Notice of restrictions where use control is necessary,” and “Protection of resources.” These factors — particularly public safety and the protection of resources — are similar to those that this Court has found satisfy the public policy prong of the discretionary function test.

Gonzalez cites to Cope v. Scott, for support that a government’s failure to place warning signs did not satisfy the policy prong of the discretionary function test. The D.C. Circuit in Cope found that “any discretion exercised by the government with respect to where and how to post signs warning of dangerous road conditions did not implicate ‘political, social, or economic’ policy choices.” But Cope is inapposite, as it involved signs on a roadway, not in the wilderness. Gonzalez additionally contends “[i]t is inconceivable that the public policy considerations of a pleasant nature experience in an aesthetic atmosphere forego basic patron safety standards.” Once again, this argument addresses whether the officials best balanced the policy considerations, when the inquiry is whether the challenged actions were susceptible to policy considerations. Gonzalez further maintains, “[t]hé Government offered no evidence to show that its failure to post standard signage as required by regulations for closures was as a result of a policy decision.” However, “the proper inquiry ... is not whether [the official] in fact engaged in a policy analysis when reaching his decision but instead whether his decision was ‘susceptible to policy analysis.’ ” Because the USFS’s decision about how to post notice of the closed trail was based on “considerations of social, economic, or political public policy” it satisfies the second prong of the discretionary function exception test.

AFFIRMED.

      . Gonzalez was injured on the ramp before making it to the bridge area.

      . Davila v. United States, 713 F.3d 248, 255 (5th Cir. 2013) (citation omitted).

      . In re FEMA Trailer Formaldehyde Prod. Liab. Litig. (Mississippi Plaintiffs), 668 F.3d 281, 287 (5th Cir. 2012) (citation omitted) [hereinafter In re FEMA Trailer].

      . Gonzalez contends that some facts the district court relied upon are disputed. We find the facts pertinent to analyzing the discretionary function exception are undisputed unless noted otherwise. See In re FEMA Trailer, 668 F.3d at 287 (court may take into account resolved disputed facts).

      . United States v. Navajo Nation, 537 U.S. 488, 502, 123 S.Ct. 1079, 155 L.Ed.2d 60 (2003) ("It is axiomatic that the United States may not be sued without its consent and that the existence of consent is a prerequisite for jurisdiction.” (quotation marks and citation omitted)); In re FEMA Trailer, 668 F.3d at 287.

      . In re FEMA Trailer, 668 F.3d at 287 (citing 28 U.S.C. § 1346 and § 2671, et seq.); In re Supreme Beef Processors, Inc., 468 F.3d 248, 252 n. 4 (5th Cir. 2006); accord Spotts v. United States, 613 F.3d 559, 566 (5th Cir. 2010).

      . Davila, 713 F.3d at 256.

      . United States v. Gaubert, 499 U.S. 315, 320-22, 111 S.Ct. 1267, 113 L.Ed.2d 335 (1991).

      . Tsolmon v. United States, 841 F.3d 378, 380 (5th Cir. 2016) (citation omitted).

      . Gaubert, 499 U.S. at 322, 111 S.Ct. 1267 (citations omitted).

      . Berkovitz by Berkovitz v. United States, 486 U.S. 531, 536-37, 108 S.Ct. 1954, 100 L.Ed.2d 531 (1988) (citation omitted).

      . Spotts, 613 F.3d at 567 (quoting Berkovitz by Berkovitz, 486 U.S. at 536, 108 S.Ct. 1954).

      . Berkovitz by Berkovitz, 486 U.S. at 536, 108 S.Ct. 1954; accord Tsolmon, 841 F.3d at 382.

      . Davila, 713 F.3d at 263.

      . Spotts, 613 F.3d at 567 (citation omitted).

      . Gaubert, 499 U.S. at 322, 111 S.Ct. 1267 (quoting Berkovitz, 486 U.S. at 536, 108 S.Ct. 1954)).

      . Gibson v. United States, 809 F.3d 807, 812 (5th Cir. 2016) (citation omitted).

      . Spotts, 613 F,3d at 572 (quoting Gaubert, 499 U.S. at 325, 111 S.Ct. 1267); accord In re FEMA Trailer Formaldehyde Prod. Liab. Litig. (Louisiana Plaintiffs), 713 F.3d 807, 810 (5th Cir. 2013).

      . See Young v. United States, 769 F.3d 1047, 1054 (9th Cir. 2014) (quotation marks and citation omitted).

      . See The Handbook, Exhibit 01 in Chapter 10, which states for Class 3 developed trails, which include the Bethel Bicycle Trails: “Mypically maintenance conducted every 1-3 years or in response to reports of trail or resource damage or significant obstacles to Managed Use and experience level.”

        . See Young, 769 F.3d at 1054; Autery v. United States, 992 F.2d 1523, 1527 (11th Cir. 1993) ("Before we address whether the government’s conduct violated a mandatory regulation or policy, we must determine exactly what conduct is at issue.”).

      . Autery, 992 F.2d at 1524.

      . Id. at 1527 (citations omitted).

      . See id.

      . Id. at 1528.

      . Id.

      . Freeman v. United States, 556 F.3d 326, 338 (5th Cir. 2009).

      . Emphasis added.

      . Emphasis added.

      . Gaubert, 499 U.S. at 322, 111 S.Ct. 1267 (citations omitted).

      . Spotts, 613 F.3d at 567 (citation omitted).

      . He also agreed he never read the "forest service handbook.”

      . Ashford v. United States, 511 F.3d 501, 505 (5th Cir. 2007) (citation omitted).

      . In re Katrina Canal Breaches Litigation, 696 F.3d 436, 450 (5th Cir. 2012). 28 U.S.C. § 2680(a) states in part: "Any claim ... based upon the exercise or performance or the failure to exercise or perform a discretionary function or duty on the part of a federal agency or an employee of 'the Government, whether or not the discretion involved be abused." (emphasis added).

      . Berkovitz by Berkovitz, 486 U.S. at 536-37, 108 S.Ct. 1954 (quotation marks and citation omitted).

      . See 809 F.3d 807, 816-17 (5th Cir. 2016).

      . Id. at 809.

      . Id.

      . See id. at 810 (e.g., "[flailing to provide stairs with handrails ... to inspect mobile homes”).

      . Id. at 809.

      . Id. at 813.

      . See id. at 816.

      . Id. at 816-17 (citation omitted).

      . Gibson, 809 F.3d at 815.

      . 245 F.3d 388 (5th Cir. 1998).

      . 155 Fed.Appx. 121 (5th Cir. 2005) (unpublished).

      . Gibson, 809 F.3d at 815 (citations omitted).

      . Id.

      . Spotts, 613 F.3d at 573.

      . Berkovitz by Berkovitz, 486 U.S. at 537, 108 S.Ct. 1954 (quotation marks and citation omitted).

      . Gaubert, 499 U.S. at 324-25, 111 S.Ct. 1267.

      . Gonzalez also at times asserts that the USFS failed to adequately warn people about the bridge; but this claim falls short. Gonzalez never made it to the bridge and was not injured on the bridge.

      . In re Katrina Canal Breaches Litig., 696 F.3d at 444 (citation omitted).

      . Gonzalez argues that the Mississippi case of Vu v. Clayton, 765 So.2d 1253 (Miss. 2000) supports her proposition that the government can be deemed to have constructive knowledge of a hazard based on the passage of time. However, Vu concerns a business invitee's premises liability claim based on Mississippi law, not whether constructive knowledge is a viable theory in an FTCA discretionary function exception analysis.

      . Berkovitz by Berkovitz, 486 U.S. at 536, 108 S.Ct. 1954.

      . Contra Young, 769 F.3d at 1054 (“In our view, the 'specific allegatio[n] of agency wrongdoing’ that we must use in determining whether the discretionary function exception applies in this case is Plaintiffs' allegation that NPS staff failed to warn of a known, latent hazard that the agency itself created.").

      . The challenged action would then be whether the controlling policies mandated the USFS mark the trail as closed in a specific manner.

      . In re Katrina Canal Breaches Litig., 696 F.3d at 449 (citations omitted).

      . Id. (quotation marks and citation omitted).

      . Emphasis added.

      . See In re Katrina Canal Breaches Litig., 696 F.3d at 452 ("[T]he ostensibly mandatory language, when read in light of the broad goals of the [policies], allowed for the exercise of judgment and choice.” (quotation marks and citation omitted)).

      . Emphasis added.

      . Theriot, 245 F.3d at 399.

      . See In re Katrina Canal Breaches Litig., 696 F.3d at 452 ("The regulation instructed, the Corps to consider several factors, some technical (e.g., shore erosion and accretion) but also many that concern policy (summarized by the catch-all ‘needs and welfare of the people’), satisfying prong two as well.”); Theriot, 245 F.3d at 399-400 (noting policy factors like “the degree of danger an object poses, the vessel traffic type and density, the location of the object in relation to the navigable channel, the history of vessel accidents, and the feasibility and economics, including costs, of erecting and maintaining physical markers in light of the available resources”).

      . 45 F.3d 445 (D.C. Cir. 1995).

      . Cope, 45 F.3d at 446.

      . Id. at 452 ( We agree that in certain circumstances, decisions will be exempt under the FTCA because they involve difficult policy judgments balancing the preservation of the environment against the blight of excess signs. But this is not one of those circumstances. Beach Drive is not the Grand Canyon’s Rim Drive, nor Shenandoah’s Skyline Drive. Here, the Park Service has chosen to manage the road in a manner more amenable to commuting through nature than communing with it.”).

      . Spotts, 613 F.3d at 572 (quoting Gaubert, 499 U.S. at 325, 111 S.Ct. 1267)).

      . Theriot, 245 F.3d at 397 (citation omitted).


source: Caselaw Access Project

author: CLAY, Circuit Judge.

license: Public Domain

text:
    Eloise HITCHCOCK; Sheryl Kae, Plaintiffs-Appellants, v. CUMBERLAND UNIVERSITY 403(B) DC PLAN; Cumberland University; John Does 1-10, Defendants-Appellees.
    No. 16-5942
    United States Court of Appeals, Sixth Circuit.
    Argued: January 25, 2017
    Decided and Filed: March 14, 2017

      ARGUED: Blair L. Byrum, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Ctíriae. Karla M. Campbell, BRANSTETTER, STRANCH & JENNINGS, PLLC, Nashville, Tennessee, for Appellants. Daniel W. Olivas, LEWIS, THOMASON, KING, KRIEG & WALDROP, P.C., Nashville, Tennessee, for Appellees. ON BRIEF: Blair L. Byrum, UNITED STATES DEPARTMENT OF LABOR, Washington, D.C., for Amicus Curiae. Karla M. Campbell, BRANSTETTER, STRANCH & JENNINGS, PLLC, Nashville, Tennessee, for Appellants. Charles W. Cagle, Laura H. Alrutz, Brian S. Faughnan, LEWIS, THOMASON, KING, KRIEG & WAL-DROP, P.C., Nashville, Tennessee, for Ap-pellees.
    Before: MERRITT, CLAY, and DONALD, Circuit Judges.
   CLAY, Circuit Judge.

OPINION

Eloise Hitchcock (“Hitchcock”) and Sheryl Kae (“Kae”) (collectively, “Plaintiffs”) appeal from the order entered by the district court granting the motion of the Cumberland University 403(b) DC Plan (the “Plan”) and Cumberland University (the “University”) (collectively, “Defendants”) to dismiss without prejudice this Employee Retirement Income Security Act (“ERISA”), 29 U.S.C. § 1001, et seq., action.

For the reasons that follow, we REVERSE the district court’s judgment and REMAND the case for further proceedings consistent with this opinion.

I. BACKGROUND

Statement of Facts

Plaintiffs were employees of the University and were participants in the Plan. Hitchcock was the director of the University’s library, and Kae was the director of business programs and a professor. Hitchcock worked at the University from August 27, 2007, to March 5, 2015. Kae worked at the University from January 31, 2012, to September 2014.

The Plan is a defined contribution pension plan sponsored by the University for its employees. In 2009, the University adopted a five percent matching contribution, whereby the University would match an employee’s contribution to the Plan up to five percent of the employee’s salary. The 2009 Summary Plan Description stated that “[i]f [the employee] contributed 5% or more of [their] Compensation[,] ... [the] Employer will make a Matching Contribution of 5% of [the employee’s] Compensation.” (R. 1-3, 2009 Summary Plan Description, Page ID #59-60.)

On October 9, 2014, the University amended the Plan to replace the five percent match with a discretionary match, whereby the University would determine the amount of the employer’s matching contribution on a yearly basis (the “amendment”). (Compare R. 1-2, 2014 Plan Document, Page ID #40 (plan document indicating that the employer’s matching contribution is discretionary and determined from year to year), with R. 1-1, 2009 Plan Document, Page ID #20 (plan document indicating that the employer’s matching contribution is five percent of the employee’s compensation if the employee contributes five percent or more of his or her compensation to the plan)).

The University made the amendment retroactive effective January 1, 2013. The University also announced that the employer matching contribution for the 2013-14 year would be zero percent, and on May 29, 2014, the University announced by way of email that the employer matching contribution for the 2014-15 year would be zero percent.

With regard to amending the Plan,.the 2009 Summary Plan Description states that:

The Plan will be amended from time to time to incorporate changes required by the law and regulations governing retirement plans. [The] Employer also has the right to amend the Plan to add new features or to change or eliminate various provisions. An Employer cannot amend the Plan to take away or reduce protected benefits under the Plan (e.g., the Employer cannot reduce the vesting percentage that applies to [the employee’s] current balance in the Plan).

(R. 1-3 at 66.)

With regard to receiving information about the Plan, the 2009 Summary Plan Description states that “all Plan Participants shall be entitled to ... [o]btain, upon request to the Employer, copies of documents governing the operations of the Plan, including ... updated Summary Plan Description.” (Id. at 70.)

As of the date of oral argument in this case on January 25, 2017, the University had not produced a summary plan description subsequent to the 2009 Summary Plan Description despite Plaintiffs’ repeated requests. Defendants have not provided formal written notice of the amendment regarding the matching provision, and have failed to provide formal written notice of the amendment regarding the annual matching provision within a reasonable period prior to the commencement of the Plan year.

Procedural History

On November 12, 2015, Plaintiffs filed a class action complaint against Defendants alleging the following: (1) wrongful denial of benefits on behalf of the benefits class, in violation of 29 U.S.C. § 1132(a)(1)(B) (Count I); (2) anti-cutback violation on behalf of the benefits class, in violation of 29 U.S.C. § 1054(g) (Count II); (3) failure to provide notice on behalf of the notice class, in violation of 29 U.S.C. § 1132(a)(3) (Count III); and (4) breach of fiduciary duty on behalf of the benefits and notice classes, in violation of 29 U.S.C. § 1104 (Count IV). On December 23, 2015, Defendants answered the complaint, and on February 9, 2016, Defendants filed a motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6).

On June 9, 2016, the district court construed Defendants’ motion to dismiss as a motion for judgment on the pleadings because it was filed after Defendants answered the complaint. The district court then granted the motion, dismissed the case without prejudice so that “Plaintiffs may administratively exhaust their claims,” and entered judgment. (R. 45, Order Granting Mot. to Dismiss, Page ID #830.) Specifically, the district court dismissed Counts I, II, and IV for failure to exhaust administrative claim procedures, and dismissed Count III based on Plaintiffs’ failure to state a claim upon which relief could be granted.

On June 22, 2016, Plaintiffs timely appealed the district court’s dismissal of Counts II, III, and IV.

II. DISCUSSION

A. Subject Matter Jurisdiction

As an initial matter, we address whether we have jurisdiction to adjudicate this appeal in light of the district court’s order, which states that Plaintiffs’ claims are dismissed without prejudice. The district court issued its order dismissing the “case” without prejudice, and on that same day, entered final judgment. Normally, a district court will dismiss a case without prejudice when it believes that the complaint can be saved by amendment. In such a case, a district court will not enter final judgment. Conversely, a district court will dismiss a case with prejudice and enter final judgment when it determines that no amendment can save a complaint from the strictures of the civil pleading requirements. Within thirty days after entry of judgment, the party appealing the order or entry of judgment must file the notice of appeal with the district court clerk. Fed. R. Civ. P. 4(a)(1)(A). In other words, a district court’s entry of judgment starts the clock on a party’s right to appeal. Here, the district court dismissed Plaintiffs’ complaint without prejudice and entered final judgment. Plaintiffs contend that we have jurisdiction pursuant to 28 U.S.C. § 1291.

Under § 1291, we have jurisdiction over “final decisions of the district courts of the United States.” 28 U.S.C. § 1291; see also Semerenko v. Cendant Corp., 223 F.3d 165, 172 (3d Cir. 2000) (noting that “a dismissal without prejudice is not a final and appealable order under § 1291, unless the plaintiff can no longer amend the complaint or unless the plaintiff declares an intention to stand on the complaint as dismissed”). “A court of appeals independently evaluates its appellate jurisdiction over cases.” United States v. Yeager, 303 F.3d 661, 664 (6th Cir. 2002). We must determine whether the district court intended its order to be final and appealable by dismissing all four claims without prejudice and entering final judgment.

We have explained that “ ‘[f]or a dismissal without prejudice to be inherently final, it must, as a practical matter, prevent the parties from further litigating the merits of the case in federal court.’ ” Robert N. Clemens Tr. v. Morgan Stanley DW, Inc., 485 F.3d 840, 845-46 (6th Cir. 2007) (quoting Yeager, 303 F.3d at 665). In Sanford v. Motts, 258 F.3d 1117, 1119 (9th Cir. 2001), the Ninth Circuit explained that “[w]here the district court dismisses an [entire] action without prejudice, ... the order is final and appealable.” Accord Thompson v. Mich. Dep’t of Corr., 23 Fed.Appx. 486, 487-88 (6th Cir. 2001) (explaining that “where the district court dismisses an action without prejudice, the order is final and appealable,” and that “[a] review of the judgment reflects that the district court clearly intended to dismiss the entire action” because it dismissed all of the plaintiffs’ claims without prejudice) (emphasis added).

In this ease, the district court must háve intended to dismiss Plaintiffs’ entire action without prejudice because the court dismissed all four of Plaintiffs’ claims and stated that it was dismissing the “case” without prejudice. Moreover, if it did not intend to dismiss the entire action, it would not have entered final judgment; rather, the court would have given Plaintiffs an opportunity to amend their complaint after they had exhausted their administrative remedies. See Clemens Tr., 485 F.3d at 845-46 (citing Thomas v. Kalu, 218 Fed.Appx. 509, 512 (7th Cir. 2007) (“[W]e consider the judgment final because the district court showed that it was ‘finished with the case’ by dismissing the entire action.”)).

Furthermore, by not attempting to amend their complaint or object to the district court’s entry of judgment, Plaintiffs must have intended to “stand” on the dismissed complaint. See Clemens Tr., 485 F.3d at 845 (citing Semerenko, 223 F.3d at 172 (noting that “a dismissal without prejudice is not a final and appealable order under § 1291, unless the plaintiff can no longer amend the complaint or unless the plaintiff declares an intention to stand on the complaint as dismissed”)).

Thus, we hold that we have subject matter jurisdiction' over Plaintiffs’ appeal because the district court dismissed the entire action without prejudice and entered final judgment, thereby piaking its order final and appealable under § 1291.

B. Failure to Exhaust Administrative Remedies

1. Preservation of Issue on Appeal

Defendants first contend that Plaintiffs did not raise below their argument-addressing whether the district court erred in applying the administrative exhaustion requirement to Counts II and IV.

Plaintiffs argue that that they did raise this argument before the district court as evidenced by the district court’s order addressing the issue. Plaintiffs further argue that they had to devote their initial response brief to Defendants’ admitted procedural error in filing a motion to dismiss rather than a motion for judgment-on the pleadings. The record clearly provides support for Plaintiffs’ contentions. (Compare R. 47, District Court Order, Page ID #836 (“ ‘[t]he Sixth Circuit has not determined whether [statutory violation claims] under ERISA [] must be administratively exhausted”)) with R. 23-1, Pls.’ Surreply, Page ID #333 n.2 (“ ‘The Third, Fifth, [ ] Tenth [and D.C.] Circuits also distinguish between claims for benefits and claims to enforce statutory rights. The Sixth Circuit has not reached the issue.”)

Therefore, we hold that Plaintiffs properly preserved this argument for appeal.

2. Standard of Review

“ ‘The district court’s decision regarding a motion for judgment on the pleadings pursuant to Federal Rule of Civil Procedure 12(c) is analyzed using the same de novo standard of review employed for a motion to dismiss under Rule 12(b)(6).’ ” Florida Power Corp. v. First-Energy Corp., 810 F.3d 996, 999-1000 (6th Cir. 2015) (quoting Tucker v. Middleburg-Legacy Place, 539 F.3d 545, 549 (6th Cir. 2008)). We take “as true all well-pleaded material allegations in the opposing party’s pleadings, and affirm the district court’s grant of the motion only if the moving party is entitled to judgment as a matter of law.” Id. (citing JPMorgan Chase Bank, N.A. v. Winget, 510 F.3d 577, 581 (6th Cir. 2007)). This non-deferential standard of review applies to the district court’s dismissal of Count III and whether Defendants violated § 1132(a)(3) of ERISA by failing to provide notice of the amendment prior to the start of the Plan year.

On the issue of what standard of review applies to the district court’s application of the exhaustion principles to Counts II and IV, the district court is usually afforded a more deferential standard of review. Costantino v. TRW, Inc., 13 F.3d 969, 974 (6th Cir. 1994) (citing Curry v. Contract Fabricators Inc. Profit Sharing Plan, 891 F.2d 842, 846 (11th Cir. 1990) (“[T]he decision whether to apply the exhaustion requirement is committed to the district court’s sound discretion and can be overturned on appeal only if the district court has clearly abused its discretion.”), abrogated on other grounds by Murphy v. Reliance Standard Life Ins. Co., 247 F.3d 1313 (11th Cir. 2001); and Baxter v. C.A. Muer Corp., 941 F.2d 451, 453-54 (6th Cir. 1991) (adopting abuse of discretion standard to a district court’s decision to apply exhaustion requirement)). Plaintiffs argue that the correct standard of review is de novo because the applicability of exhaustion principles to Counts II and IV is a question of law. Defendants argue that the correct standard of review is abuse of discretion.

The predominant issue here is whether exhaustion principles should apply to the anti-cutback and fiduciary duty claims, which is a question of law. Therefore, we review de novo the district court’s application of the exhaustion principles to Counts II and IV. See Harrow, 279 F.3d at 248; Diaz v. United Agric. Employee Welfare Benefit Plan & Tr., 50 F.3d 1478, 1483 (9th Cir. 1995) (“Because the potential applicability vel non of exhaustion principles is a question of law, we consider it de novo. But if that question gets an affirmative answer, the District Court’s decision not to grant an exception to the application of those principles is reviewed for an abuse of discretion.”).

3. Analysis

Plaintiffs argue that the district court erred in requiring exhaustion of administrative remedies for Counts II and IV because that holding is contrary to binding Sixth Circuit precedent and will place us in the minority of circuits which have addressed this issue. Plaintiffs further contend that the district court erred in dismissing Count III because Plaintiffs lacked the proper discovery to sufficiently argue why Defendants failed to provide notice of the amendment. Defendants argue in response that the district court did not err in dismissing the entire action because the complaint failed to sufficiently allege that Plaintiffs had standing to bring the action. Defendants next contend that the amendment was a business decision and not a fiduciary act by the University, and therefore, Count IV was properly dismissed. Defendants further contend that, in the event we determine to reconcile the circuit split on the application of administrative exhaustion to statutory ERISA claims, it urges us to adopt the nuanced approach developed by the Third Circuit in Cottillion v. United Refining Co., 781 F.3d 47, 54 (3d Cir. 2015). Under such an approach, Defendants argue that the district court correctly dismissed the complaint without prejudice to permit Plaintiffs to exhaust administrative remedies prior to filing suit in order to create a more comprehensive administrative record for their statutory claims.

a. Relevant Legal Principles

“There is no doubt about the centrality of ERISA’s object of protecting employees’ justified expectations of receiving the benefits their employers promise them.” Central Laborers’ Pension Fund v. Heinz, 541 U.S. 739, 743, 124 S.Ct. 2230, 159 L.Ed.2d 46 (2004). “ERISA § 502(a)(1)(B), 29 U.S.C. § 1132(a)(1)(B), provides a contract-based cause of action to participants and beneficiaries to recover benefits, enforce rights, or clarify rights to future benefits under the terms of an employee benefit plan.” Fallick v. Nationwide Mut. Ins. Co., 162 F.3d 410, 418 (6th Cir. 1998). Although the statute itself is ‘'silent as to whether exhaustion of administrative remedies is a prerequisite to bringing a civil actionf,] ... due to ERISA’s provision for the administrative review of benefits,” the courts, including this Circuit, have read an exhaustion requirement into the statute. Id.

The purposes of exhausting administrative remedies were discussed in Costanti-no:

(1) To help reduce the number of frivolous lawsuits under ERISA.
(2) To promote the consistent treatment of claims for benefits.-
(3) To provide a nonadversarial method of claims settlement.
(4) To minimize the costs of claims settlement for all concerned.
(5) To enhance the ability of trustees of benefit plans to expertly and efficiently manage their funds by preventing premature judicial intervention in their decision-making processes.
(6) To enhance the ability of trustees of benefit plans to correct their errors.
(7) To enhance the ability of trustees of benefit plans to interpret plan provisions.
(8) To help assemble a factual record which will assist a court in reviewing the fiduciaries’ actions.

Costantino, 13 F.3d at 975. “If these purposes would not be furthered, there would be no sense in exhausting administrative remedies.” Id.

The administrative exhaustion requirement includes an exception for circumstances “ ‘when resort to the administrative route is futile or the remedy inadequate.’ ” Id. at 974 (citation omitted). In order to satisfy the high standard of futility. “[a] plaintiff must show that ‘it is certain that his claim will be denied on appeal, not merely that he doubts that an appeal will result in a different decision.’ ” Fallick, 162 F.3d at 419 (citation omitted); see also Commc’ns Workers of Am. v. AT & T, 40 F.3d 426, 432 (D.C. Cir. 1994) (“The futility exception is ... quite restricted and has been applied only when resort to administrative remedies is clearly useless.”) (internal quotation marks and citations omitted). We have affirmed a district court’s finding of futility where the plaintiffs challenged the legality of a plan’s retroactive amendment. See Costantino, 13 F.3d at 975. A challenge to the “legality” of a plan’s amendment, rather than a challenge to the interpretation of an amendment, is futile because “if [plaintiffs were to resort to the administrative process, [the plan administrator] would merely recalculate their benefits and reach the same result.” Id.

Moreover, “[t]he anti-cutback rule serves a critical role in this [ERISA] enterprise by prohibiting pension plan amendments that decrease plan participants’ ‘accrued benefits.’ ” Thornton v. Graphic Commc’ns Conference of Intern. Broth. of Teamsters Supplemental Retire ment and Disability Fund, 566 F.3d 597, 601 (6th Cir. 2009). The Treasury has defined “accrued benefit” to mean “in the case of a plan which is not a defined benefit plan,” like the Plan in this case, “the balance of the employee’s account.” I.R.C. § 411(a)(7)(A)(ii).

b. Application

i. Standing

Defendants argue that the district court’s judgment should be affirmed because Plaintiffs do not have standing to sue in federal court. Defendants contend that Plaintiffs failed to allege that they made actual contributions to the Plan, which would have triggered a matching obligation by Defendants. Specifically, Defendants contend that the only allegation referencing any such contribution is stated in Paragraph 12, which reads that “[d]uring his or her tenure at Cumberland University, each Plaintiff participated in the Plan.” (R. 1, Complaint, Page ID #4 ¶ 12.) Defendants argue that Plaintiffs’ allegation that they participated in the Plan “during” their tenure does not mean that they contributed to the Plan during the time period affected by the amendment. Plaintiffs argue in response that Defendants waived this standing argument because they did not raise it below; and second, ERISA provides a cause of action to “participants” of such plans.

Plaintiffs have standing to sue because ERISA provides a cause of action to “participants” of employee pension plans. Only “participants” and “beneficiaries” as defined by ERISA have standing to sue under ERISA. 29 U.S.C. § 1132(a)(1). Under ERISA, “participant” is defined as “any employee or former employee of an employer ... who is or may become eligible to receive a benefit of any type from an employee benefit plan which covers employees of such employer.” 29 U.S.C. § 1002(7). Hitchcock worked at the University from August 27, 2007, to March 5, 2015, and Kae worked at the University from January 31, 2012, to September 2014. The retroactive amendment went into effect in January 2013, and lasted through the end of 2015. Hitchcock and Kae were employees of the University during the time disturbed by the Plan amendment, and therefore, were participants under ERISA.

ii. Exhaustion of Administrative Remedies

We next address whether the district court erred in holding that Plaintiffs must first exhaust administrative remedies before bringing suit on Counts II and TV. We hold that the district court erred.

In Costantino, we concluded that the district court did not abuse its discretion in ruling that the plaintiffs were not required to exhaust their administrative remedies prior to filing their ERISA action against the plan administrator. A group of retirees filed a class action against their former employer and the Secretary of the Board of Administrators of TRW’s Salaried Employees Pension Plan, alleging, inter alia, that the plan administrator’s retroactive amendment to the plan was unconstitutional and violated ERISA’s anti-cutback rules because it improperly calculated the retirees’ lump-sum distributions and eliminated retirement benefits they would have received but for the retroactive amendment. Id. at 972-73. One- of TRW’s arguments was that the plaintiffs’ claims should be dismissed for failure to exhaust administrative remedies. Id. at 973.

We affirmed the district court’s decision based on its reasoning that administrative exhaustion would be futile since the plaintiffs’ claims were “directed to the legality of [the plan administrator’s] amended [p]lan, not to a mere interpretation of it.” Id. at 975 (emphasis in original). We reiterated the district court’s reasoning that if the plaintiffs “were to resort to the administrative process, [the plan administrator] would merely recalculate their benefits and reach the same result.” Id. We also looked to the purposes underlying the administrative exhaustion requirement for further support. After reviewing the purposes, we specifically stated that:

This lawsuit can hardly be said to be frivolous, and there is little likelihood that this matter will become any less adversarial. Costs for all parties would probably increase if Plaintiffs were forced to go back through the administrative process. [The plan administrator] is unlikely to change it's position through a “correction of error” or different “interpretation” of the plan given its stance in the instant litigation, and the factual record is already well assembled. Consequently, exhaustion of administrative remedies in the present case would be. purposeless, as well as futile and inadequate.

Id. at 975.

Similarly, in Durand v. Hanover Ins. Group, Inc., 560 F.3d 436 (6th Cir. 2009), we held that a plan participant’s challenge to a plan’s methodology for calculating lump-sum distributions was not subject to ERISA’s administrative exhaustion requirement because the challenge was directed at the plan’s legality. In Durand, we echoed the rule set out in Costantino, “that, in an ERISA case, when the plaintiffs ‘suit [i]s directed to the legality of [a plan], not to a mere interpretation of it[,]’ exhaustion of the plan’s administrative remedies would be futile.” 560 F.3d at 439-40 (emphasis in original) (quoting Costantino, 13 F.3d at 975). In Durand, we compared the circumstances when administrative exhaustion would be required and when it would not. We explained that administrative exhaustion is required “when an ERISA plaintiff contends that his benefits were improperly calculated under the terms of a plan.” Id. at 439. We further explained that we enforce the exhaustion requirement because “ERISA plans are often complicated things, and the question whether a plan’s methodology was properly applied in a particular case is usually one best left to the plan administrator” because “[a]dministrators, not courts, are the experts in plan administration.” Id.

Notwithstanding, in cases where the plaintiff challenges the legality of a plan’s methodology, “the claimant typically concedes that her benefit was properly calculated under the terms of the plan as written, but argues that the plan itself is illegal in some respect.” Id. Because the question of legality “is one within the expertise of the courts[,]” the decision to require such a claimant to exhaust administrative remedies in order “to recalculate a benefit she concedes was already properly calculated under the terms of the plan as written, misses the point of the dispute.” Id. In situations where a claimant concedes her benefit was properly calculated under the terms of the plan as written, “exhaustion wastes resources rather than conserves them.” Id. Consequently, “we have held that, in an ERISA case, when the plaintiffs suit is directed to the legality of a plan, not to a mere interpretation of it, exhaustion of the plan’s administrative remedies would be futile.” Id. at 439-40 (emphasis in original) (internal quotation marks and brackets omitted).

In the instant case, Plaintiffs challenge the legality of the Plan amendment, i.e., the amendment that reduced the amount the employer contributed to the employee’s pension plan from five percent to a discretionary amount. As iterated in Du-rand, the legality of the amendment is a question best suited for the courts to decide. Contrary to the district court’s position, Plaintiffs are not challenging the calculation of their benefits nor are they only seeking monetary damages. Plaintiffs concede that their benefits were properly calculated. The district court improperly viewed Counts II and IV as additional claims for wrongful denial of benefits. The district court relied on the damages sought for Count I and the damages sought for Counts II and IV, and reasoned that because Counts II and IV sought damages in the same amount as Count I, Counts II and IV constituted wrongful denial of benefits claims dressed as statutory ERISA claims.

With respect to Count II, the district court expressly stated that “[b]eeause Plaintiffs did not exhaust their administrative remedies, this [wrongful denial of benefits claim] is [ ] dismissed.” (R. 47 at 836.) With respect to Count IV, the court explained how the complaint supported “Defendants!’] argufment] that the fiduciary-duty count is a repackaging for individual benefits.... [because] it asks for damages in the amount of the five percent matching that the Plan eliminated in its amendment.” (Id.) The record demonstrates the contrary. Plaintiffs brought their anti-cutback claim (Count II), to “obtain appropriate equitable relief to enforce the provisions of ERISA and the relevant plan.” (R. 1 at 9 ¶ 45.) Likewise, Plaiptiffs brought their breach of fiduciary duty claim (Count IV) to “obtain appropriate equitable relief on behalf of the plan itself.” (Id. at 11 ¶¶ 62-63.) The district court was incorrect in narrowly interpreting Plaintiffs’ statutory claims.

While it is true that the damages potentially recoverable for the statutory ERISA claims may be the same as the damages potentially recoverable for the wrongful denial of benefits claim, depending on the court’s determination of whether the amendment is legal, the resulting benefits are not the gravamen of Plaintiffs’ challenge. The record demonstrates that Plaintiffs were challenging the legality of the Plan amendment with Counts II and IV. It is a serious mischaracterization to simply say that because the denial of benefits claim and the statutory ERISA claims result in the same monetary sum, all must constitute denial of benefits claims. Our precedent indicates that administrative exhaustion is a futile requirement for statutory ERISA claims that challenge the legality of a plan amendment. If such exhaustion were required for those statutory claims, in order for Plaintiffs to receive proper resolution from the plan administrator, the administrator would need to determine whether the retroactive amendment was properly instituted in the first place, i.e., whether the amendment was legal. As stated in Du-rand, that is not the plan administrator’s role. It is the role of the courts to determine the legality of a plan amendment.

We note that the circuits are split on the issue of whether participants or beneficiaries of an ERISA plan “must exhaust internal plan remedies before suing plan fiduciaries on the basis of an alleged violation of duties imposed by the statute.” Mason v. Cont’l Grp., 474 U.S. 1087, 1087, 106 S.Ct. 8633, 88 L.Ed.2d 902 (1986) (White, J., dissenting from denial of certio-rari) (stating that “the Court should grant certiorari in this case in order to resolve the' uncertainty over the existence of an exhaustion requirement in cases of this kind”). “[W]e have not yet decided whether a beneficiary must exhaust' administrative remedies prior to bringing claims based on statutory rights[.]” Hill v. Blue Cross & Blue Shield of Mich., 409 F.3d 710, 717 (6th Cir. 2005). Rather, we have resolved the issue of administrative exhaustion for certain statutory claims in prior cases “on the grounds that exhaustion would be futile or that the fiduciary-duty claim is merely a repackaged claim for individual benefits which the beneficiary must administratively exhaust before filing suit.” Id.; see also Durand, 560 F.3d at 440. In prior ERISA cases, we have required the plaintiffs to either administratively exhaust their claims or plead futility, which is a high pleading standard to meet. Today, we resolve the question of whether participants or beneficiaries claiming statutory violations of an ERISA plan “must exhaust internal plan remedies before suing plan fiduciaries on the basis of an alleged violation of duties imposed by the statute.” Mason, 474 U.S. at 1087, 106 S.Ct. 8633 (White, J., dissenting from denial of certiorari). We hold that (1) there is no exhaustion requirement for ERISA claims alleging statutory, rather than plan-based, violations, and (2) Counts II and IV assert statutory violations not subject to the exhaustion requirement.

The Third, Fourth, Fifth, Ninth, Tenth, and D.C. Circuits “have all held exhaustion is not required when plaintiffs seek to enforce statutory ERISA rights rather than contractual rights created by the terms of the Plan.” Stephens v. Pension Benefit Guar. Corp., 755 F.3d 959, 965 (D.C. Cir. 2014) (discussing fiduciary breach claims) (citing Zipf v. AT & T, 799 F.2d 889, 891-94 (3d Cir. 1986) (retaliation claim); Smith v. Sydnor, 184 F.3d 356, 364-65 (4th Cir. 1999) (fiduciary breach claim); Galvan v. SBC Pension Benefit Plan, 204 Fed.Appx. 335, 338-39 (5th Cir. 2006) (fiduciary breach claim); Amaro v. Cont’l Can Co., 724 F.2d 747, 751-52 (9th Cir. 1984) (retaliation claim); Held v. Mfrs. Hanover Leasing Corp., 912 F.2d 1197, 1204-05 (10th Cir. 1990) (retaliation claim)).

Conversely, the Seventh and Eleventh Circuits “have held the exhaustion requirement applies even where plaintiffs assert statutory rights.” Stephens, 755 F.3d at 965 (citing Lindemann v. Mobil Oil Corp., 79 F.3d 647, 649-50 (7th Cir. 1996) (noting that requiring parties to exhaust administrative remedies for statutory claims would enable plan fiduciaries to compile a factual record that would assist the court in reviewing their action and would minimize the number of frivolous lawsuits by promoting a non-adversarial dispute resolution process)); see also Mason v. Cont’l Grp., 763 F.2d 1219, 1226-27 (11th Cir. 1985).

We agree with the Third, Fourth, Fifth, Ninth, Tenth, and D.C. Circuits. Thus, we hold that ERISA plan participants or beneficiaries do not need to exhaust internal remedial procedures before proceeding to federal court when they assert statutory violations of ERISA. See Stephens, 755 F.3d at 966.

We note that actions brought “to enforce the terms of a plan” are distinguishable from those brought “to assert rights granted by the federal statute.” Zipf, 799 F.2d at 891. In Zipf, the Third Circuit supported its holding that the exhaustion requirement is not applicable to statutory ERISA claims by first reasoning that “[t]he provision relating to internal claims and appeals procedures, Section 503, refers only to procedures regarding claims for benefits.” Id.; see also ERISA § 503, 29 U.S.C. § 1133 (requiring every employee benefit plan to “afford a reasonable opportunity to any participant whose claim for benefits has been denied for a full and fair review by the appropriate named fiduciary” (emphasis added)). The court then explained that “the legislative history suggests that the remedy for [claims based on violations of ERISA’s substantive guarantees] was intended to be provided by the courts.” Id. at 892.

The D.C. Circuit succinctly stated in Stephens that:

[w]hile plan administrators may have particular expertise in interpreting their pension plans’ terms, federal judges have particular expertise in interpreting statutory terms. And while consistent application of a pension plan’s terms might best be achieved by allowing plan administrators to interpret those terms in the first instance, consistent application of the law is best achieved by encouraging a unitary judicial interpretation of that law. Federal district courts also have the expertise to create a factual record, should that be necessary, and to encourage settlement of disputes where appropriate.

755 F.3d at 966.

We further note that this statutory claims exception to the exhaustion requirement does not apply to “plan-based claims ‘artfully dressed in statutory clothing,’ such as where a plaintiff seeks to avoid the exhaustion requirement by re-characterizing a claim for benefits as a claim for breach of fiduciary duty.” Id. at 966 n.7 (quoting Drinkwater v. Metro. Life Ins. Co., 846 F.2d 821, 826 (1st Cir. 1988)).

Plaintiffs’ anti-cutback and breach of fiduciary duty claims are properly characterized as statutory claims because they are claims asserting rights granted by ERISA. Section 1054(g) of ERISA substantively guarantees that an accrued benefit may not be decreased by an amendment of the plan which does not comply with the statute. 29 U.S.C. § 1054(g). Section 1104 of ERISA guarantees that a fiduciary of an employee benefit plan will discharge his or her duties “with the care, skill, prudence, and diligence under the circumstances then prevailing that a prudent man acting in a like capacity and familiar with such matters would use.” 29 U.S.C. § 1104(a)(1)(B).

“[T]he relevant inquiry is what forms the basis of [Plaintiffs’] right to relief: the contractual terms of the pension plan or the provisions of ERISA and its regulations.” Stephens, 755 F.3d at 967. The rights Plaintiffs assert — the right to receive accrued benefits which have not been decreased by an illegal amendment, and the right to have a fiduciary discharge his or her duties in accordance with the statute — are granted to them by ERISA, not by the Plan’s contractual terms. Thus, Plaintiffs assert statutory claims, which are not subject to the exhaustion requirement. '

We also reject Defendants’ suggestion that we follow the narrow approach outlined by the Third Circuit in Cottillion. In Cottillion, the Third Circuit refrained from ruling on the issue of whether administrative exhaustion applied to statutory ERISA claims, and instead affirmed the district court by holding that exhaustion would be futile. 781 F.3d at 54. If we were to follow Defendants’ suggestion, it would not resolve the issue of whether administrative exhaustion applies to statutory ERISA claims, and it would further delay our decision on that issue.

Therefore, we conclude that the district court erred in applying the administrative exhaustion principles to Counts II and IV.

iii. Failure to Provide Notice

Lastly, we address whether the district court erred in dismissing Count III for failure to state a claim. We hold that the district court erred.

In addition to dismissing Counts II and IV for failure to exhaust administrative remedies, the district court also dismissed Count III on two grounds. First, the district court concluded that Plaintiffs failed to plead Count III with particularity after finding that Plaintiffs did not respond to Defendants’ motion to dismiss. Specifically, the district court reasoned that since Plaintiffs failed to respond to Defendants’ argument concerning Count III, “[f]or this reason alone, Defendants’ motion to dismiss Count Three is granted.” (R. 47 at 837.) Second, the district court summarily concluded that Plaintiffs failed to state a claim upon which relief could be granted after it made an “independent review of the [merits of the] pleadings.” (Id.) The district court did not go into further analysis (or rather, any analysis) on how Plaintiffs failed to respond to the argument or why the complaint did not plead with particularity the claim that Defendants failed to give proper notice of the amendment to Plaintiffs..

In support of its conclusion that Plaintiffs waived any opposition to Defendants’ argument concerning Count III, the district court cited one of our unpublished opinions, Humphrey v. United States Att’y Gen.’s Office, 279 Fed.Appx. 328 (6th Cir. 2008). In Humphrey, the plaintiff failed to oppose the defendants’ motions to dismiss. As a result, we concluded that the plaintiff waived his appellate arguments. Id. at 331. Unlike the plaintiff in Humphrey, Plaintiffs in this case did oppose Defendants’ motion to dismiss., Plaintiffs explained why they were unable to present a proper argument in response to Defendants’ motion on Count III. Plaintiffs argued that they needed “discovery from Defendants about the various representations made to participants about their retirement benefits (for example, materials provided to employees by Defendants’ Human Resources Department) and required notices that were not made to participants (such as notice of plan amendments, updated summary plan description, etc.).” (R. 16, Pls.’ Resp. to Defs.’ Mot. to Dismiss, Page ID #167.) Plaintiffs further argued that the documents and facts needed to be discovered and that the failure to provide such discovery by Defendants rendered the motion to dismiss “null or at the very least premature.” (Id.)

We hold that the district court erred. Humphrey is distinguishable on the grounds that it involved a situation where the plaintiffs failed to oppose the motion altogether. Plaintiffs in this case opposed the motion as to Count III by arguing that they were unable to properly present an argument due to Defendants’ failure to provide the necessary discovery. Rather than dismiss the complaint, the district court should have allowed Plaintiffs an opportunity to formally request the documents. At the very least, the district court should have given Plaintiffs an opportunity to amend the complaint. On remand, the district court should determine whether Count III is a statutory ERISA claim not subject to the administrative exhaustion requirements.

4. Summary

We hold that the district court erred in applying the administrative exhaustion principles to Counts II and IV. As a matter of first impression, we hold that plan participants or beneficiaries, such as Plaintiffs here, need not exhaust administrative remedies before proceeding to federal court when they assert statutory violations under ERISA. The record in this case demonstrates that Plaintiffs asserted statutory violations of ERISA which challenged the legality of the Plan’s amendment. We further hold that the district court erred in finding that Plaintiffs failed to oppose Defendants’ argument as to Count III.

III. CONCLUSION

For the aforementioned reasons, we REVERSE the district court’s judgment and REMAND the case for further proceedings consistent with this opinion.

      . We would undoubtedly have subject matter jurisdiction over this case if the district court had dismissed the entire action with prejudice and entered final judgment.

      . The Department of Labor argues that we should review de novo the district court's application of exhaustion principles rather than abuse of discretion because a court’s review of the applicability of exhaustion principles is a question of law. (U.S. Dep’t of Labor Br. 9 (citing Harrow v. Prudential Ins. Co. of Am., 279 F.3d 244, 248 (3d Cir. 2002))).

      . We do not address whether Count III is a statutory claim because the district court did not dismiss Count III for failure to exhaust administrative remedies. Our disposition of Count III is discussed below in Section B.3.b.iii.

      . The United States Department of Labor, as amicus curiae, also supports the position that the district court erred in applying an administrative exhaustion requirement to Plaintiffs’ statutory ERISA claims.