Burks v. Ret. Sys. of Ala. (Ex parte Ret. Sys. of Ala.)

• Decision Date: 12 June 2015
• Docket Number: 1140170.
• Citation: 182 So.3d 527
• Parties: Ex parte The RETIREMENT SYSTEMS OF ALABAMA et al. (In re James B. Burks II et al. v. The Retirement Systems of Alabama et al.).
• Court: Alabama Supreme Court

182 So.3d 527

Ex parte The RETIREMENT SYSTEMS OF ALABAMA et al.

(In re James B. Burks II et al.

v.The Retirement Systems of Alabama et al.).

1140170.

Supreme Court of Alabama.

June 12, 2015.

Leura Canary and JoClaudia Moore, Retirement Systems of Alabama, Montgomery, for petitioners.

Joe R. Whatley, Jr., and Charlene P. Ford of Whatley Kallas, LLP, Birmingham; Randy Beard of Beard & Beard, Guntersville; and Joseph C. Espy III of Melton, Espy & Williams, P.C., Montgomery, for respondents.

BRYAN, Justice.

The Retirement Systems of Alabama ("RSA"), the Teachers' Retirement System of Alabama ("TRS"), the Public Education Employees' Health Insurance Plan ("PEEHIP"), the Public Education Employees' Health Insurance Fund ("PEEHIF"), the Board of Control of TRS ("the TRS Board"), the Board of Control of PEEHIP ("the PEEHIP Board"), David G. Bronner, as chief executive officer of RSA and as secretary-treasurer of TRS and PEEHIP, and various members of the TRS Board and of the PEEHIP Board in their official capacities¹ (hereinafter collectively referred to as "the PEEHIP defendants") seek mandamus review of the Montgomery Circuit Court's denial of their motion to dismiss the claims filed against them by James B. Burks II, Eugenia Burks, Martin A. Hester, Jacqueline Hester, Thomas Highfield, Carol Ann Highfield, Jake Jackson, and Melinda Jackson, individually and on behalf of a class of similarly situated individuals (hereinafter collectively referred to as "the public-education plaintiffs").

For the reasons set forth herein, the petition is granted in part and denied in part and a writ is issued directing the Montgomery Circuit Court to dismiss all the public-education plaintiffs' claims against RSA, PEEHIP, the PEEHIP Board, PEEHIF, TRS, the TRS Board, the members of the TRS Board, and Bronner, in his capacity as chief executive officer of RSA and as secretary-treasurer of TRS; to dismiss all the public-education plaintiffs' state-law claims against the members of the PEEHIP Board and Bronner, in his capacity as secretary-treasurer of PEEHIP; and to dismiss the public-education plaintiffs' claims against the members of the PEEHIP Board and Bronner, in his capacity as secretary-treasurer of PEEHIP, for monetary relief, pursuant to § 1983. The petition is denied with regard to the public-education plaintiffs' claims for injunctive relief, pursuant to § 1983, against the members of the PEEHIP Board and Bronner, in his capacity as secretary-treasurer of PEEHIP.

Facts and Procedural History

PEEHIP, which is managed by the PEEHIP Board, provides group health-insurance benefits to public-education employees in Alabama. Each year, the PEEHIP Board submits "to the Governor and to the Legislature the amount or amounts necessary to fund coverage for benefits authorized by this article for the following fiscal year for employees and for retired employees as a monthly premium per active member per month." § 16–25A–8(b), Ala.Code 1975. That monthly premium is paid by employers for each of their active members ("the employer contribution"). See § 16–25A–8(a), Ala.Code 1975.

In addition, "[e]ach employee and retired employee [is] entitled to have his or her spouse and dependent children, as defined by the rules and regulations of the [PEEHIP] board, included in the coverage provided upon agreeing to pay the employee's contribution of the health insurance premium for such dependents." § 16–25A–8(e), Ala.Code 1975. Section 16–25A–1(8), Ala.Code 1975, provides, in pertinent part, that "[i]ndividual premiums may include adjustments and surcharges for ... family size including, but not limited to, a husband and wife both being covered by a health insurance plan as defined herein." The employer contribution, as well as "all premiums paid by employees and retired employees under the provisions of this section and any other premiums paid under the provisions of this article," are deposited into PEEHIF. § 16–25A–8(f), Ala.Code 1975.

In May 2014, the public-education plaintiffs, who are all public-school educators and PEEHIP participants married to other public-school educators and PEEHIP participants and who have dependent children, sued the PEEHIP defendants, alleging:

"Until 2009, each participating educator in each school system received the full allotment provided by their employer [ (i.e., the employer contribution) ], regardless of marital status. For example, under the pre–2009 policy, a husband and wife in the public school system in 2013 would have each received an allotment of $714 for a total of $1428 to spend on health insurance. Accordingly, the couple would have no out-of-pocket costs for health insurance.

"However, in 2009, [the PEEHIP defendants] implemented a policy whereby a wife and husband who are both educators in the public school system and who have dependent children would receive a single allotment, rather than two. Based on this policy, two educators who are married to each other and who have dependent children received a single allotment of $714 rather than each receiving an individual allotment of $714.

"Accordingly, since 2009 public school educators who are married to another Alabama educator and who have dependent children have been required to pay out-of-pocket for any health insurance expenses that exceed the amount of an individual allotment. Therefore, rather than having no out-of-pocket costs for health insurance, the couple has to contribute $177 of their own money each month for health insurance. Moreover, educators who are married to each other are not permitted to utilize the second allotment toward the purchase of the four optional plans or the supplemental medical plan. In effect, one of the spouses receives no insurance benefit whatsoever.

"On the other hand, every single educator, every married educator whose spouse is not employed by a school system and every married educator who does not have dependent children continues to receive individual allotments. Therefore, in 2013 every public school educator in Alabama—other than [the public-education plaintiffs] and Class Members—received a monthly allotment of $714 for insurance benefits. If an educator's spouse works outside the public school system and the educator is covered on the spouse's health plan, the educator can utilize his or her allotment to purchase the four optional plans with no out-of-pocket cost."

The public-education plaintiffs alleged that the policy adopted by the PEEHIP Board in 2009 ("the 2009 policy") violated Article V, § 138.03, Alabama Constitution of 1901,² as well as the public-education plaintiffs' rights to equal protection, due process, and freedom of association under the Alabama Constitution, the United States Constitution, and 42 U.S.C. § 1983. The public-education plaintiffs also alleged that the 2009 policy violated Alabama public policy and their right to family integrity as protected by the Alabama Constitution. The public-education plaintiffs sought relief in the form of (1) a judgment declaring "[the PEEHIP defendants'] practice of denying an allotment for insurance benefits to educators who are married to another educator and who have dependent children to be unconstitutional, discriminatory and unlawful under both State and Federal law"; (2) an injunction preventing the PEEHIP defendants from "denying an allotment for insurance benefits to educators whose spouse is also an educator in the public school system and who have dependent children"; (3) restitution of "amounts ... unlawfully withheld and/or ... amounts [the public-education plaintiffs] have paid for insurance that they would not have paid absent [the PEEHIP defendants'] unlawful conduct" or other equitable relief; and (4) costs and attorney fees.

The PEEHIP defendants moved the circuit court, pursuant to Rules 12(b)(1) and 12(b)(6), Ala. R. Civ. P., to dismiss the public-education plaintiffs' complaint, arguing, among other things, that the claims against them were barred by the doctrine of sovereign immunity. The circuit court denied the motion to dismiss, and the PEEHIP defendants have petitioned this Court for mandamus relief from that order.

Analysis

"It is well established that mandamus will lie to compel the dismissal of a claim that is barred by the doctrine of sovereign immunity." Ex parte Blankenship, 893 So.2d 303, 305 (Ala.2004).

"As this Court has consistently held, the writ of mandamus is a

" ‘ "drastic and extraordinary writ that will be issued only when there is: 1) a clear legal right in the petitioner to the order sought; 2) an imperative duty upon the respondent to perform, accompanied by a refusal to do so; 3) the lack of another adequate remedy; and 4) properly invoked jurisdiction of the court." ’

" Ex parte Wood, 852 So.2d 705, 708 (Ala.2002) (quoting Ex parte United Serv. Stations, Inc., 628 So.2d 501, 503 (Ala.1993) ). ‘ "In reviewing the denial of a motion to dismiss by means of a mandamus petition, we do not change our standard of review...." ’ Drummond Co. v. Alabama Dep't of Transp., 937 So.2d 56, 57 (Ala.2006) (quoting Ex parte Haralson, 853 So.2d 928, 931 (Ala.2003) ).

" ‘In Newman v. Savas, 878 So.2d 1147 (Ala.2003), this Court set out the standard of review of a ruling on a motion to dismiss for lack of subject-matter jurisdiction:

" ‘ "A ruling on a motion to dismiss is reviewed without a presumption of correctness. Nance v. Matthews, 622 So.2d 297, 299 (Ala.1993). This Court must accept the allegations of the complaint as true. Creola Land Dev., Inc. v. Bentbrooke Housing, L.L.C., 828 So.2d 285, 288 (Ala.2002). Furthermore, in reviewing a ruling on a motion to dismiss we will not consider whether the pleader will ultimately prevail but whether the pleader may possibly prevail. Nance, 622 So.2d at 299."

" ‘878 So.2d at 1148.’

" Pontius v. State Farm Mut. Auto. Ins. Co., 915 So.2d 557, 563 (Ala.2005). We construe all doubts regarding the sufficiency of the complaint in favor of the plaintiff. Drummond Co., 937 So.2d at 58."

Ex parte Alabama...