Browning Corp. Intern. v. Lee

Decision Date13 January 1986
Docket NumberCiv. A. No. 4-85-472-E.
Citation624 F. Supp. 555
PartiesBROWNING CORPORATION INTERNATIONAL v. Doyce LEE, Commissioner of Insurance for the State of Texas (Successor to Tom Bond and E.J. Voorhis, former Commissioners of Insurance), and James P. Odiorne, Liquidator, (Succesor to Anthony G. Harris, former Liquidator.)
CourtU.S. District Court — Northern District of Texas

Sterling W. Steves, Steves, Leonard & Jones, Fort Worth, Tex., for plaintiff.

Allene D. Evans, Asst. Atty. Gen., Ins., Banking & Securities Div., Austin, Tex., Robert R. Bodoin, McLean Sanders Price Head & Ellis, Fort Worth, Tex., for defendants.

MEMORANDUM OPINION AND ORDER

MAHON, District Judge.

Before the Court is Defendants Doyce Lee, Commissioner of Insurance for the State of Texas and James T. Odiorne, Liquidator's motion to dismiss for failure to state a claim and for lack of jurisdiction to which the plaintiff has responded. A hearing was held on the motion on January 2, 1986. After carefully considering the arguments of counsel, the briefs filed, the record and the applicable law, the Court makes the following determination.

The suit was filed on July 26, 1985 and is the third in a series of related suits involving the Ministers' Benefit Trust ("MBT"), an entity established in 1978 pursuant to a trust agreement by employer-churches and church schools to provide certain benefits to its eligible employees. Plaintiff is a third party administrator of the trust. In this suit, plaintiff seeks (1) a declaratory judgment that the MBT is an employee benefit plan under the Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. ("ERISA"); and (2) an injunction against Defendant Odiorne, enjoining him from administering the affairs of the MBT and from prosecuting the claims now pending before the 200th Judicial District Court, Travis County, Texas.

The first suit was brought in 1980 by the Attorney General of Texas against the MBT, its trustee and the members of its Benefit Committee, alleging that the MBT was engaged in the insurance business in Texas without complying with the rules and regulations of the State Insurance Board. The MBT was duly served but failed to answer and a default judgment was entered against it. The other parties agreed to the rendition of a judgment finding the law and facts to be as alleged by the State. On January 5, 1981, a "Consent Permanent Injunction and Order Appointing Permanent Receiver" was filed declaring that the MBT be permanently enjoined from conducting insurance or any other business; that the MBT was insolvent and unable to remedy its insolvency; and that it was necessary to appoint the liquidator for the State Board of Insurance as receiver of the MBT pursuant to Tex.Ins.Code Ann. art. 21.28 (Vernon's 1981). The MBT has never attempted, either directly or by collateral attack, to set aside this judgment.

The second suit was filed on July 28, 1981 by Anthony G. Harris, after being appointed permanent receiver of the MBT, against Bob Browning, Plaintiff Browning Corporation International, the trustee of the MBT and the members of the Benefit Committee of the MBT. After Anthony Harris resigned as Liquidator, Defendant Odiorne replaced him as plaintiff in this lawsuit. The complaint alleges mismanagement, preferential payment of claims and the charging of grossly excessive fees. This case is presently set for trial in the 200th Judicial District Court for January 27, 1986.

In the present suit, plaintiff seeks a declaration that the MBT is an employee benefit plan governed by ERISA. Because ERISA displaced applicable state law in the regulation of private employee benefit plans, if the MBT is such a plan, then it is governed by ERISA and not by Texas insurance law. As such, plaintiff asserts that the state district court had no jurisdiction to appoint a receiver for the MBT and presently has no jurisdiction to determine the receiver's claims against representatives and third-party administrators of the MBT.

In their motion to dismiss, defendants claim that (1) the complaint fails to state a claim because plaintiff has no standing to assert the rights of the MBT and (2) this Court lacks subject matter jurisdiction because both the U.S. Department of Labor and the state district court have already determined that the MBT is an insurance company and not an employee benefit plan within the meaning of ERISA. In the event this Court does have jurisdiction to hear plaintiff's claims, defendants argue that such claims should be raised as a defense in the state court proceeding and request this Court to decline to exercise its jurisdiction. In response, plaintiff argues that federal courts have exclusive jurisdiction to determine whether an employee benefit plan is subject to ERISA.

Not only has plaintiff been unable to cite and the Court unable to find any case authority for plaintiff's proposition that ...

To continue reading

Request your trial
7 cases
  • Weiner v. Blue Cross of Maryland, Inc., Civ. No. PN-89-2256.
    • United States
    • United States District Courts. 4th Circuit. United States District Court (Maryland)
    • February 5, 1990
    ...The applicability of ERISA, however, is a matter that state courts can and indeed must resolve. See, e.g., Browning Corp. Int'l v. Lee, 624 F.Supp. 555, 557 (N.D.Tex.1986) (state courts must have ability to determine if ERISA governs particular employee benefit plan to effectively enforce s......
  • Knapp v. Cardinale
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Eastern District of California
    • July 15, 2013
    ...of an ERISA plan. SeeWeiner v. Blue Cross & Blue Shield of Maryland, Inc., 925 F.2d 81, 83 (4th Cir.1991); Browning Corp. Int'l v. Lee, 624 F.Supp. 555, 557 (N.D.Tex.1986). Many courts have also assumed concurrent jurisdiction to decide ERISA plan status without specifically addressing the ......
  • Knapp v. Cardinale, Case No. C-12-05076-RMW
    • United States
    • United States District Courts. 9th Circuit. United States District Courts. 9th Circuit. Northern District of California
    • July 15, 2013
    ...of an ERISA plan. See Weiner v. Blue Cross & Blue Shield of Maryland, Inc., 925 F.2d 81, 83 (4th Cir. 1991); Browning Corp. Int'l v. Lee, 624 F. Supp. 555, 557 (N.D. Tex. 1986). Many courts have also assumed concurrent jurisdiction to decide ERISA plan status without specifically addressing......
  • Blue Cross and Blue Shield of Maryland, Inc. v. Weiner, 88-5518
    • United States
    • United States Courts of Appeals. United States Court of Appeals (11th Circuit)
    • April 5, 1989
    ...746, 27 L.Ed.2d 669 (1971) (federal courts should generally refrain from enjoining pending state proceedings); Browning Corp. Int'l. v. Lee, 624 F.Supp. 555, 557 (N.D.Tex.1986) (state courts must have ability to determine if ERISA governs particular employee benefit plan to effectively enfo......
  • Request a trial to view additional results

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT