An IRA owner sometimes has a claim against an investment advisor or a company for losses in connection with products or services provided to the IRA. Such a claim may be based on fraud, misappropriation, breach of contract, or other default in duties owed to the customer, or it may simply be part of a class action brought on behalf of many shareholders. The IRA owner normally brings the claim (or joins the class action) in his own name, not in the name of the IRA; a custodial IRA is not an "entity" that can file a lawsuit or claim.
If the IRA owner, in his own name, recovers money on such a claim, the question becomes, how can this money be restored to the IRA? If he just deposits the money into the IRA, wouldn't that be an "excess contribution?"