Callery v. Exxonmobil Corp.

Decision Date20 August 2021
Docket NumberCivil Action H-21-1086
PartiesTIMOTHY K. CALLERY, JOHN B. FRAZIER, and JAMES T. WILLIAMS, Plaintiffs, v. EXXONMOBIL CORPORATION, and THE EXXONMOBIL MEDICAL PLAN, Defendants.
CourtU.S. District Court — Southern District of Texas
MEMORANDUM AND OPINION

LEE H ROSENTHAL CHIEF UNITED STATES DISTRICT JUDGE

Timothy Callery, John Frazier, and James Williams are American citizens and former employees of ExxonMobil Corporation. (Docket Entry No. 11 at 3). Each worked for ExxonMobil for decades, both in and outside the United States. Each is married to a Thai citizen and has lived as a retiree in Thailand for more than four years. (Docket Entry No. 15 at 1). None plans to live in the United States.

Each plaintiff is a current beneficiary of ExxonMobil's Retiree Medical Plan. (Docket Entry No. 4 at ¶ 46; Docket Entry No. 11 at 3 n.1). In the fall of 2020, each was informed in writing that he must have a physical U.S. street address and be enrolled in Medicare to continue to be eligible for Plan benefits after December 31, 2021. (Docket Entry No. 4 at ¶ 49; Docket Entry No. 15-2). The writing stated that medical coverage would end on December 31, 2021 for any plan participant not living in the United States. (Docket Entry No. 4 at ¶ 50). This policy change affected fewer than 200 out of 47, 000 plan participants. (Id. at ¶ 52). The plaintiffs must have health insurance to remain in Thailand, and they allege that they cannot find replacement coverage there. (Id. at ¶¶ 46, 51, 59).

In April 2021, the plaintiffs sued ExxonMobil. The plaintiffs claim that ExxonMobil discriminated against them, in violation of ERISA § 510, by requiring all retirees over 65 to live in the United States to receive health benefits under the Plan. (Id. at ¶¶ 64, 68). They assert causes of action (1) for age discrimination under 29 U.S.C. §§ 1140, 1132(a)(1); (2) breach of fiduciary duty under 29 U.S.C. § 1004; (3) an ERISA cause of action under 29 U.S.C. § 1132; and (4) detrimental reliance, seeking a declaratory judgment that they are entitled to continued coverage despite their age and foreign residence. (Id. at ¶¶ 68, 76, 77 80, 83).

ExxonMobil moved to dismiss the claims under Federal Rules of Civil Procedure 12(b)(1) and 12(b)(6). (Docket Entry No. 11). ExxonMobil argues that the claims are not ripe, the claims are moot, and the allegations do not state a claim for relief. (Docket Entry No. 14 at 3-7). The plaintiffs responded, and the court held oral argument on the motion. After careful review, the court denies the motion to dismiss under Rule 12(b)(1), finding the claims ripe and not moot, but grants the Rule 12(b)(6) motion to dismiss for failure to state a claim. Because further amendment would be futile, the dismissal is with prejudice. The reasons are explained below.

I. The Legal Standards
A. A Motion to Dismiss under Rule 12(b)(1)

Federal Rule of Civil Procedure 12(b)(1) governs challenges to a court's subject-matter jurisdiction. A case is properly dismissed, for lack of subject matter jurisdiction when the court lacks the statutory or constitutional power to adjudicate the case.” M.J.L. v. McAleenan, 420 F.Supp.3d 588, 593 (W.D. Tex. 2019) (quoting Home Builders Ass'n of Miss., Inc. v. City of Madison, 143 F.3d 1006, 1010 (5th Cir. 1998)). Lack of subject matter jurisdiction may be found in any one of three instances: (1) the complaint alone; (2) the complaint supplemented by undisputed facts evidenced in the record; or (3) the complaint supplemented by undisputed facts plus the court's resolution of disputed facts. King v. U.S. Dept. of Veterans Affairs, 728 F.3d 410, 413 (5th Cir. 2013). The plaintiff bears the burden of demonstrating that subject-matter jurisdiction exists. See Paterson v. Weinberger, 644 F.2d 521, 523 (5th Cir. 1981). A court lacks power to decide a claim when a plaintiff lacks standing to bring the claim.

Standing requires: (1) an “injury in fact” that is (a) concrete and particularized and (b) actual or imminent; (2) a causal connection between the injury and the conduct complained of; and (3) the likelihood that a favorable decision will redress the injury.” Croft v. Governor of Tex., 562 F.3d 735, 745 (5th Cir. 2009) (citing Lujan v. Defenders of Wildlife, 504 U.S. 555, 560 (1992)). As “the party invoking federal jurisdiction, ” the plaintiffs “bear[ ] the burden of establishing these elements.” Lujan, 504 U.S. at 561. They must meet this burden “with the manner and degree of evidence required at the successive stages of the litigation, ” which means that “on a motion to dismiss, plaintiffs must allege facts that give rise to a plausible claim of . . . standing.” Cornerstone Christian Sch. v. Univ. Interscholastic League, 563 F.3d 127, 133-34 (5th Cir. 2009) (quoting Lujan, 504 U.S. at 561). When a complaint seeks multiple kinds of relief, the plaintiff must show standing “for each type of relief sought.” Summers v. Earth Island Inst., 555 U.S. 488, 493 (2009) (citing City of Los Angeles v. Lyons, 461 U.S. 95, 105 (1983)).

B. A Motion to Dismiss under Rule 12(b)(6)

Rule 12(b)(6) allows dismissal if a plaintiff fails “to state a claim upon which relief can be granted.” Fed.R.Civ.P. 12(b)(6). In Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007), and Ashcroft v. Iqbal, 556 U.S. 662 (2009), the Supreme Court confirmed that Rule 12(b)(6) must be read in conjunction with Rule 8(a), which requires “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed.R.Civ.P. 8(a)(2). To withstand a Rule 12(b)(6) motion, a complaint must contain “enough facts to state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570. The Supreme Court explained that “the pleading standard Rule 8 announces does not require ‘detailed factual allegations,' but it demands more than an unadorned, the-defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 677.

A court considers only the pleadings in deciding a motion for judgment on the pleadings, see Brittan Commc'ns Int'l Corp. v. Sw. Bell Tel. Co., 313 F.3d 899, 904 (5th Cir. 2002), but [d]ocuments that a defendant attaches to a motion to dismiss are considered part of the pleadings if they are referred to in the plaintiff's complaint and are central to her claim.” See, e.g., Causey v. Sewell Cadillac-Chevrolet, Inc., 394 F.3d 285, 288 (5th Cir. 2004); In re Katrina Canal Breaches Litig., 495 F.3d 191, 205 (5th Cir. 2007); see also 5B Charles Alan Wright & Arthur R. Miller, Federal Practice and Procedure § 1357, at 509-10 (3d ed. 2004) (stating that “matters incorporated by reference or integral to the claim [and] items appearing in the record of the case . . . may be considered by the district judge without converting the [Rule 12(b)(6)] motion into one for summary judgment). Although material allegations in the complaint must be accepted as true and construed in the light most favorable to the nonmoving party, a court is not required to accept conclusory legal allegations cast in the form of factual allegations if those conclusions cannot reasonably be drawn from the facts alleged.

II. Analysis
A. Ripeness

The “ripeness doctrine is drawn both from Article III limitations on judicial power and from prudential reasons for refusing to exercise jurisdiction.” Roark & Hardee LP v. City of Austin, 522 F.3d 533, 544 (5th Cir. 2008) (quoting Reno v. Catholic Social Servs., Inc., 509 U.S. 43, 57 n.18 (1993)). Ripeness separates those matters that are premature because the injury is speculative and may never occur from those that are appropriate for judicial review. U.S. v. Payton, 959 F.3d 654, 656 (5th Cir. 2020) (citing U.S. v. Carmichael, 343 F.3d 756, 761 (5th Cir. 2003)).

“A declaratory judgment action, like any other action, must be ripe in order to be justiciable.” TOTAL Gas & Power N. Am., Inc. v. Fed. Energy Regul. Comm., 859 F.3d 325, 332 (5th Cir. 2017). To determine ripeness, courts consider: (1) whether the issues are fit for judicial decision and (2) the “hardship to the parties of withholding court consideration.” Roark, 522 F.3d at 545; see also Cent. & SW Servs. v. E.P.A. 220 F.3d 683, 690 (5th Cir. 2000) ([E]ven where an issue presents purely legal questions, the plaintiff must show some hardship in order to establish ripeness.”).

The issues presented in this case make it fit for judicial decision now. Section 502(a)(1)(B) of ERISA allows a plaintiff to bring a civil action “to clarify his rights to future benefits under the terms of the plan.” 29 U.S.C. § 1132(a)(1)(B); see Corcoran v. United Healthcare, Inc., 965 F.2d 1321, 1335 (5th Cir. 1992) (“When a beneficiary simply wants what was supposed to have been distributed under the plan, the appropriate remedy is 502(a)(1)(B).”). The plaintiffs assert a “right to enforce the insurance coverage they contracted for” and have “standing to pursue alleged breaches of this statutory duty.” N. Cypress Med. Ctr. Operating Co., Ltd. v. Cigna Healthcare, 781 F.3d 182, 194 (5th Cir. 2015).

The fact that the insurance benefits last until December 31 2021, does not defeat ripeness. “Where the inevitability of the operation of a statute against certain individuals is patent, it is irrelevant to the existence of a justiciable controversy that there will be a time delay before the disputed provisions will come into effect.” Chevron U.S.A., Inc. v. Traillour Oil Co., 987 F.2d 1138, 1153 (5th Cir. 1993). The inevitability of the plaintiffs losing their insurance benefits is evident; ExxonMobil has informed them that their medical coverage under the ExxonMobil benefit plan ends on December 31, 2021, unless they relocate to, and have a residence address in, the United States. (Docket Entry No. 4 at ¶ 50; see also Docket Entry No. 15-4). In November...

To continue reading

Request your trial

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