Burks v. Amerada Hess Corp.

• Decision Date: 07 December 1993
• Docket Number: No. 92-5290,92-5290
• Citation: 8 F.3d 301
• Parties: 9 IER Cases 44, 17 Employee Benefits Cas. 2174, Pens. Plan Guide P 23894J Thomas H. BURKS, Plaintiff-Appellee, v. AMERADA HESS CORPORATION and Alan Fuller, Defendants-Appellants.
• Court: U.S. Court of Appeals — Fifth Circuit

Page 301

8 F.3d 301

9 IER Cases 44, 17 Employee Benefits Cas. 2174,

Pens. Plan Guide P 23894J

Thomas H. BURKS, Plaintiff-Appellee, v. AMERADA HESS CORPORATION and Alan Fuller, Defendants-Appellants.

No. 92-5290.

United States Court of Appeals, Fifth Circuit.

Dec. 7, 1993.

Thomas H. Wilson, W. Carl Jordan, Christopher V. Bacon, Vinson & Elkins, Houston, TX, Joel B. Sheffield, Ramey & Sheffield, Sulphur Springs, TX, for defendants-appellants.

Sybil Colson, Coy Johnson, Sulphur Springs, TX, for plaintiff-appellee.

Appeal from the United States District Court for the Eastern District of Texas.

Before WISDOM, HIGGINBOTHAM, and SMITH, Circuit Judges.

JERRY E. SMITH, Circuit Judge:

Thomas H. Burks was an employee of Amerada Hess Corporation ("Hess") who suffered an on-the-job injury and filed for workers' compensation. Shortly thereafter, Hess fired Burks, allegedly for using company property for his personal benefit during work hours. Burks contended that he was fired in retaliation for making a workers' compensation claim, and he filed suit in Texas state court against Hess and Alan Fuller, a Hess manager. Later he amended his complaint, alleging intentional infliction of emotional distress, unlawful termination, slander, libel, and defamation, all arising from the termination of employment and the denial of his long-term benefits. The defendants removed to federal court, basing jurisdiction upon the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. §§ 1001-1461. After Burks amended his complaint once again, the district court remanded to state court. Because we find that the district court abused its discretion by remanding, we reverse.

I.

Burks's original petition in state court, filed in March 1991, claimed that Hess fired him in retaliation for filing a worker's compensation claim and alleged the following:

Defendant's firing of Plaintiff is a violation of Article 8307(c) Texas Revised Civil Statutes which prevents employers from firing workers who have filed worker's compensation claims.... As a result of Defendant's unlawful action, Plaintiff has suffered damages. Plaintiff Burks has suffered lost wages in the past and will suffer lost wages in the future. Plaintiff has also as a result of his employment, received additional benefits such as health insurance and retirement benefits. As a result of his firing, Plaintiff will not [sic] longer receive such benefits.

In April 1992, Burks replaced the original petition with a first amended petition containing the following language:

Defendant's firing of Plaintiff is a violation of Article 8307(c) Texas Revised Civil Statutes which prevents employers from firing workers who have filed worker's compensation claims. Plaintiff was fired immediately upon his return to work from being off due to an on-the-job injury, and further his employer denied his long-term disability benefits. The defendants' actions constitute an intentional infliction of emotional distress.

* * * * * *

Plaintiff would further show the Court that during his employment with AMERADA HESS CORPORATION he worked overtime and was never compensated for it or received any comp time. Plaintiff has overtime due and owing in the amount of $30,000.00.

Within thirty days of the filing of the second amended petition, Hess removed the case on the ground that Burks's claim for elimination of long-term disability benefits was preempted by ERISA.

In September 1992, Burks filed his second amended petition, which was identical to the first amended petition except that it omitted the paragraph containing the overtime compensation claim. Thus, the second amended petition contained the following statement:

Defendant's firing of Plaintiff is a violation of Article 8307(c) Texas Revised Civil Statutes which prevents employers from firing workers who have filed worker's compensation claims. Plaintiff was fired immediately upon his return to work from being off due to an on-the-job injury, and further his employer denied his long-term disability benefits. The defendants' actions constitute an intentional infliction of emotional distress.

In November 1992, the district court ordered the case remanded to state court ¹ and rejected Hess's motion to reconsider the remand, holding that the emotional distress claim contained in the second amended complaint was not preempted.

II.

The first issue we must deal with is whether we have appellate jurisdiction over the remand order. At first glance, 28 U.S.C. § 1447(d) appears to preclude appellate review of any remand order. It reads,

An order remanding a case to the State court from which it was removed is not reviewable on appeal or otherwise, except that an order remanding a case to the State court from which it was removed pursuant to section 1443 of this title shall be reviewable by appeal or otherwise.

Despite its broad language, § 1447(d) applies only to remands made pursuant to § 1447(c). Thermtron Prods. v. Hermansdorfer, 423 U.S. 336, 350-52, 96 S.Ct. 584, 593-94, 46 L.Ed.2d 542 (1976). Section 1447(c) provides two grounds for remand: (1) a defect in removal procedure and (2) lack of subject matter jurisdiction. The district court's rationale for remanding is that it has discretion not to exercise its jurisdiction over pendent state claims. ² Because this rationale is not a ground for remand under § 1447(c), ³ we can review the remand order. ⁴ J.O. v. Alton Community Unit School Dist. 11, 909 F.2d 267 (7th Cir.1990) (order based upon district court's discretion to remand pendent state claims is reviewable); Rothner v. City of Chicago, 879 F.2d 1402 (7th Cir.1989) (same) (dictum); In re Life Ins. Co. of N. Am., 857 F.2d 1190, 1193 n. 1 (8th Cir.1988); Scott v. Machinists Automotive Trades Dist. Lodge No. 190, 827 F.2d 589, 592 (9th Cir.1987) (same).

III.

We review as a matter of law the district court's decision to remand the case. Although the district court ostensibly exercised its discretion to remand a case in which federal jurisdiction has disappeared, see Carnegie-Mellon, a district court has no discretion to remand a matter in which a federal-law claim still exists. In re Wilson Indus., 886 F.2d 93, 96 (5th Cir.1989). Because the first and second amended complaints contain a claim that is preempted by federal law, the district court could not decline to hear the removed case.

Burks's second amended petition contains a claim that the denial of employee benefits by Hess constituted an intentional infliction of emotional distress. ⁵ The second amended petition reads,

Plaintiff was fired immediately upon his return to work from being off due to an on-the-job injury, and further his employer denied his long-term disability benefits. The defendants' actions constitute an intentional infliction of emotional distress. [Emphasis added.]

The district court held that Burks's complaint, although inartfully pleaded, merely asserted a claim for emotional distress arising from wrongful termination and did not assert a claim for emotional distress arising from denial of benefits. We disagree.

We interpret the language quoted above to allege two different claims: first, that the firing of Burks was an intentional infliction of emotional distress; and second, that the denial of long-term disability benefits was an intentional infliction of emotional distress. The conjunctive phrase "and further" distinguishes the two claims. Also, the allegation of intentional infliction of emotional distress in the second sentence appears to relate back to both "actions": the wrongful discharge and the denial of benefits.

Further evidence that the two claims are separate can be found in Burks's response to Hess's motion for partial summary judgment [N]either is Summary Judgment proper as to the Plaintiff's claim for intentional infliction of emotional distress. The Defendant's [sic] actions in this case are extreme and outrageous. The Plaintiff was terminated the day he attempted to return from his injury. His attempting to return to work was against his doctor's recommendation. The Defendant's [sic] then advised the other employees of the company that the Plaintiff had been terminated for misconduct which was not true. The Defendant's [sic] conduct was further outrageous in that they attempted to get him to sign a release releasing them from all claims for wrongful termination and attempted to deny him employee benefits to which he was rightly entitled. These benefits were reinstated after action by the Plaintiff's lawyer. The Plaintiff has made no claim for the denial of these benefits but rather the Defendant's [sic] actions show their outrageous behavior. [Emphasis added.]

Thus, in the district court Burks sought to isolate the denial of benefits as an independent act that inflicted emotional distress.

In our view, Burks's second amended complaint alleges that Hess denied to him his employee benefits and that such denial was an intentional infliction of emotional distress. ⁶ As we held in Brown v. Southwestern Bell Tel. Co., 901 F.2d 1250, 1254 (5th Cir.1990), a cause of action for infliction of emotional distress arising from the denial of employee benefits is preempted by ERISA. ⁷

The preemption clause in ERISA preempts all state laws that relate to ERISA plans. ⁸ A state cause of action for emotional distress arising from the denial of employee benefits determines when an employer can and cannot terminate an employee's benefits.

This is not a case in which the loss of benefits is merely an element in damages related to a claim for wrongful discharge. Burks's complaint expressly says that--independently of the wrongful discharge--his denial of benefits is illegal under state law.

IV.

Burks argues, alternatively, that if the second amended complaint is preempted by ERISA, the original petition also was preempted by ERISA. Since Hess's notice of removal was filed more than thirty days after Hess received Burks's original petition, Burks argues...