Rollins v. Kjellstrom & Lee, Inc.

• Decision Date: 15 May 2015
• Docket Number: C/A No. 4:11–70079–JFA.,CR No. 4:02–992–JFA.
• Court: U.S. District Court — Eastern District of Virginia
• Parties: Diana ROLLINS, Executor of the Estate of Millard Anthony Rollins, Plaintiff, v. KJELLSTROM & LEE, INC., and Mutual of Omaha Insurance Company, Defendants.

109 F.Supp.3d 869

Diana ROLLINS, Executor of the Estate of Millard Anthony Rollins, Plaintiff,

v.KJELLSTROM & LEE, INC., and Mutual of Omaha Insurance Company, Defendants.

CR No. 4:02–992–JFA.

C/A No. 4:11–70079–JFA.

United States District Court, E.D. Virginia, Richmond Division.

Signed May 15, 2015.

Adam Nephi Harrison, Barbara Allyn Queen, Lisa Kim Newstein Lawrence, Lawrence & Associates, Richmond, VA, for Plaintiff.

Carson W. Johnson, Jeremy David Capps, Harman Claytor Corrigan & Wellman, Robert Barnes Delano, Jr., Sands Anderson PC, Richmond, VA, for Defendants.

MEMORANDUM OPINION

M. HANNAH LAUCK, District Judge.

This matter comes before the Court on Defendants Kjellstrom & Lee, Inc. ("K & L") and Mutual of Omaha Insurance Company's ("Mutual of Omaha") (collectively, the "Defendants") Motions to Dismiss the matter against them pursuant to Federal Rule of Civil Procedure 12(b)(6)¹ and Plaintiff Diana Rollins' Motion to Remand pursuant to 28 U.S.C. § 1447(c).² (ECF Nos. 3, 6, 12.) The parties filed responses in opposition to the motions, and the moving parties filed replies. (ECF Nos. 10, 11, 14–19.) The matter is ripe for disposition.

The Court dispenses with oral argument because the materials before the Court adequately present the facts and legal contentions, and argument would not aid the decisional process. The Court exercises jurisdiction pursuant to 28 U.S.C. § 1331.³ For the reasons that follow, the Court will deny the Motion to Remand, grant the Motions to Dismiss, and grant Rollins leave to amend.

I. Standards of Review

A. Federal Rule of Civil Procedure 12(b)(6)

"A motion to dismiss under Rule 12(b)(6) tests the sufficiency of a complaint; importantly, it does not resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses." Republican Party of N.C. v. Martin, 980 F.2d 943, 952 (4th Cir.1992) (citing 5A Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1356 (1990) ). In considering a motion to dismiss for failure to state a claim, a plaintiff's well-pleaded allegations are taken as true and the complaint is viewed in the light most favorable to the plaintiff. Mylan Labs., Inc. v. Matkari, 7 F.3d 1130, 1134 (4th Cir.1993) ; see also Martin, 980 F.2d at 952.

The Federal Rules of Civil Procedure "require[ ] only ‘a short and plain statement of the claim showing that the pleader is entitled to relief,’ in order to ‘give the defendant fair notice of what the ... claim is and the grounds upon which it rests.’ " Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 167 L.Ed.2d 929 (2007) (second alteration in original) (quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957) ). Plaintiffs cannot satisfy this standard with complaints containing only "labels and conclusions" or a "formulaic recitation of the elements of a cause of action." Id. (citations omitted); see also Ashcroft v. Iqbal, 556 U.S. 662, 679, 129 S.Ct. 1937, 173 L.Ed.2d 868 (2009). Instead, a plaintiff must assert facts sufficient "to raise a right to relief above the speculative level," Twombly, 550 U.S. at 555, 127 S.Ct. 1955 (citation omitted), stating a claim that is "plausible on its face," id. at 570, 127 S.Ct. 1955, rather than merely "conceivable." Id. In order for a claim or complaint to survive dismissal for failure to state a claim, the plaintiff must "allege facts sufficient to state all the elements of [his or] her claim." Bass v. E.I. DuPont de Nemours & Co., 324 F.3d 761, 765 (4th Cir.2003) (citing Dickson v. Microsoft Corp., 309 F.3d 193, 213 (4th Cir.2002) ; Iodice v. United States, 289 F.3d 270, 281 (4th Cir.2002) ).

"If, on a motion under Rule 12(b)(6)..., matters outside the pleadings are presented to and not excluded by the court, the motion must be treated as one for summary judgment under Rule 56," and "[a]ll parties must be given a reasonable opportunity to present all the material that is pertinent to the motion." Fed.R.Civ.P. 12(d) ; see Laughlin v. Metro. Wash. Airports Auth., 149 F.3d 253, 260–61 (4th Cir.1998) ; Gay v. Wall, 761 F.2d 175, 177 (4th Cir.1985). However, "a court may consider official public records, documents central to plaintiff's claim, and documents sufficiently referred to in the complaint [without converting a Rule 12(b)(6) motion into one for summary judgment] so long as the authenticity of these documents is not disputed." Witthohn v. Fed. Ins. Co., 164 Fed.Appx. 395, 396–97 (4th Cir.2006) (citing Alt. Energy, Inc. v. St. Paul Fire & Marine Ins. Co., 267 F.3d 30, 33 (1st Cir.2001) ; Phillips v. LCI Int'l, Inc., 190 F.3d 609, 618 (4th Cir.1999) ; Gasner v. Cnty. of Dinwiddie, 162 F.R.D. 280, 282 (E.D.Va.1995) ).

Rollins attaches to her Complaint: (1) a letter dated June 14, 2000 from Jim Pritchett, Jr., Senior Vice President of K & L, to her late husband, Millard Anthony Rollins ("Mr. Rollins") (the "Offer Letter") (Compl. Ex. A, ECF No. 1–3); (2) the Group Term Life and AD & D Insurance Summary of Coverage (the "Summary") (Compl. Ex. B, ECF No. 1–3); (3) a Certificate of Insurance issued by United of Omaha Life Insurance Company ("United of Omaha") to K & L (the "Certificate") (Compl. Ex. C, ECF No. 1–3); and, (4) a portion of K & L's Handbook for Salaried Employees (the "Handbook") (Compl. Ex. D, ECF No. 1–3).

The Defendants attach to the Notice of Removal the insurance policy issued by United of Omaha to K & L (the "Policy"), its summary plan description ("Summary Plan Description"), and its summary of coverage ("Summary of Coverage") (Not. Removal Ex. 5, ECF Nos. 1–7, 1–8). The Summary Plan Description states that it provides information required to be "furnished to eligible participants in an employee benefits plan" under ERISA. (Not. Removal Ex. 5, Summ. Plan Description 41, ECF No. 1–8). The Summary Plan Description identifies K & L as the Plan Administrator. Id.

The Court will consider all the documents filed. Rollins sufficiently referred to all of her exhibits in her Complaint, as well as the Policy and related documents attached to the Notice of Removal. The documents are central to Rollins' claims, and neither party disputes their authenticity. The Court may thus consider these documents. See Witthohn, 164 Fed.Appx. at 396–97 (citations omitted).

B. Remand Pursuant to 28 U.S.C. § 1447(c), Removal via 28 U.S.C. § 1441(a), and Federal Question Jurisdiction under 28 U.S.C. § 1331

"Under the removal statute, ‘any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant’ to federal court." Aetna Health Inc. v. Davila, 542 U.S. 200, 207, 124 S.Ct. 2488, 159 L.Ed.2d 312 (2004) (quoting 28 U.S.C. § 1441(a) ). "One category of cases of which district courts have original jurisdiction is ‘[f]ederal question’ cases: cases "arising under the Constitution, laws, or treaties of the United States." " Id. (alteration in original) (quoting 28 U.S.C. § 1331 ). A defendant may remove a state action to federal court if the district court would have "original jurisdiction" over the action. Met. Life Ins. Co. v. Taylor, 481 U.S. 58, 63, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987) (quoting 28 U.S.C. § 1441(a) ). "If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded." 28 U.S.C. § 1447(c).

Generally, whether subject matter jurisdiction exists turns on the plaintiff's " ‘well-pleaded complaint.’ " Davila, 542 U.S. at 207, 124 S.Ct. 2488 (citing Franchise Tax Bd. of Cal v. Constr. Laborers Vacation Trust for S. Cal., 463 U.S. 1, 9–10, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983) ). A federal defense, because it does not appear on the face of the complaint, cannot usually provide a basis for removal. Taylor, 481 U.S. at 63, 107 S.Ct. 1542 (citation omitted); Smith v. Logan, 363 F.Supp.2d 804, 808 (E.D.Va.2004) (citing Caterpillar, Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987) ). "However, if a state law cause of action has been completely preempted by federal law, any claim based on the completely preempted state law is considered a federal claim arising under federal law." Smith, 363 F.Supp.2d at 808 (citing Caterpillar, 482 U.S. at 393, 107 S.Ct. 2425 ). Accordingly, a defendant may remove a state action to federal court if the claim comes within the scope of the preempting federal law, "even if pleaded in terms of state law," because the cause of action "is in reality based on federal law." Davila, 542 U.S. at 207–08, 124 S.Ct. 2488 (citing Beneficial Nat'l Bank v. Anderson, 539 U.S. 1, 8, 123 S.Ct. 2058, 156 L.Ed.2d 1 (2003) ). Because the interplay between ERISA preemption doctrines becomes complicated in removal actions, see Gross v. St. Agnes Health Care, Inc., No. ELH–12–2990, 2013 WL 4925374, at *7 (D.Md. Sept. 12, 2013), the Court will address the preemption issues in detail below.

II. Procedural and Factual Background

A. Summary of Allegations in Rollins' Complaint⁴

K & L employed Rollins' late husband, Millard Anthony Rollins ("Mr. Rollins"), for over 28 years. June 14, 2000, K & L Senior Vice President Jim Pritchett, Jr. sent a letter to Mr. Rollins offering the position of Superintendent, detailing that K & L would provide Mr. Rollins with various benefits including "[l]ife insurance at twice [his] annual salary." (Offer Letter 1.) K & L's Handbook also stated that K & L "provides fully paid life insurance to all salaried full time employees upon their first day of employment. This life insurance is in an amount equal to [two] times [the employee's] annual base salary." (Compl. ¶ 21; Handbook VI–3.)

In 2007, Mr. Rollins obtained the United of Omaha Policy through K & L.⁵ The Policy's Summary includes that, effective January 1, 2008, "[a]ll eligible salaried employees earning $100,000 or more" were eligible to receive "an amount of life insurance equal to [two] times your annual salary, up to $200,000." (Summary 1 (capitalization corrected)...