Erlandson v. Liberty Life Assur. Co. of Boston

• Decision Date: 02 June 2004
• Docket Number: No. Civ.A.3:04CV0636-G.,Civ.A.3:04CV0636-G.
• Citation: 320 F.Supp.2d 501
• Parties: Karen L. ERLANDSON, Plaintiff, v. LIBERTY LIFE ASSURANCE COMPANY OF BOSTON, et al., Defendants.
• Court: U.S. District Court — Northern District of Texas

320 F.Supp.2d 501

Karen L. ERLANDSON, Plaintiff, v. LIBERTY LIFE ASSURANCE COMPANY OF BOSTON, et al., Defendants.

No. Civ.A.3:04CV0636-G.

United States District Court, N.D. Texas, Dallas Division.

June 2, 2004.

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Michael F. Pezzulli, Pezzulli Kinser, Dallas, TX, for Plaintiff.

Iwana M. Rademaekers, Jackson Lewis, Stephen L. Baskind, Kleiman Lawrence Baskind & Fitzgerald, Dallas, TX, for Defendants.

MEMORANDUM ORDER

FISH, Chief Judge.

Before the court are the motions of the plaintiff Karen L. Erlandson ("Erlandson") (1) to remand this case to the state court from which it was previously removed, and (2) for attorney's fees. For the reasons set forth below, Erlandson's motion to remand is granted, but her motion for attorney's fees is denied.

I. BACKGROUND

Erlandson was a consultant employed by McKesson Corporation ("McKesson"). See Defendants' Response to Plaintiff's Emergency Motion to Remand ("Response") at 1; see also Plaintiff's Emergency Motion to Remand, or, Alternatively, to Sever Preempted Claims and Remand Remaining Claims and Brief in Support ("Motion") at 1. While suffering from several medical conditions, Erlandson took a leave of absence from McKesson and applied for short-term disability under McKesson's disability benefits plan. See Plaintiff's Third Amended Original Petition ("Petition") ¶¶ 10-13, attached to Defendant Liberty's Notice of Removal ("Notice of Removal") as Exhibit (B)(34); Motion at 2; Response at 2; see also Group Disability Risk Management Agreement (the "Plan"), attached to Appendix to Plaintiff's Emergency Motion to Remand, or, Alternatively, to Sever Preempted Claims and Remand Remaining Claims and Brief in Support ("Plaintiff's Appendix") as Exhibit (C)(3). The defendant Liberty Life Assurance Company of Boston ("Liberty") was the "claims administrator" under the Plan. Response at 2; Motion at 2.

Liberty — allegedly in the course of administering Erlandson's claim for disability benefits — hired co-defendants MJM Investigations, Inc. ("MJM"), and Richard B. Cowan ("Cowan"), an employee of MJM, to conduct a non-medical assessment (i.e., surveillance) of Erlandson's claim. See Response at 2. On July 9, 2002, Erlandson attended a scheduled doctor's visit; Cowan followed her to that visit, allegedly pretending to be a patient. See Petition ¶ 21; Motion at 2. Cf. Response at 2. After Erlandson left the doctor's office, Cowan — who was now conspicuous to Erlandson — allegedly followed her in his car "in an aggressive and threatening manner." Motion at 2; see also Petition ¶ 21. Erlandson asserts that Cowan followed her to a restaurant where she sought refuge, and then from the restaurant to a neighborhood near her home. Id. According to Erlandson, who maintains that she was suffering from "chronic depression and obsessive compulsive disorder," Motion at 1, Cowan's outrageous actions caused her to be "frightened and terrified," Petition ¶ 21, to think "she was the potential target of a violent crime," and to "fear[ ] for her life." Motion at 2.

On December 4, 2002, Erlandson filed suit against the defendant Liberty, MJM, and Cowan, in the 101st Judicial District Court of Dallas County, Texas, asserting claims for assault, invasion of privacy, and intentional infliction of emotional distress. See Plaintiff's Original Petition ¶¶ 21-24, attached to Notice of Removal as Exhibit (B)(2). The state trial court dismissed the latter two claims on summary judgment on March 12, 2004. See Order Regarding Defendants' Motion for Summary Judgment, attached to Plaintiff's Appendix as Exhibit A. Then, on March 19, 2004, Erlandson filed an amended petition adding claims for negligent infliction of emotional distress and breach of contract.¹ See Petition ¶¶ 30-49.

On March 26, 2004, Liberty timely removed this action pursuant to 28 U.S.C. § 1441, arguing that Erlandson's claims are completely preempted under the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1001, et seq. Notice of Removal at 2. On March 31, 2004, alleging improper removal, Erlandson filed the instant motion to remand the case back to state court and to collect attorney's fees for improper removal. See Docket Sheet; Motion at 1. After hearing oral arguments on April 13, 2004, this court granted Erlandson's motion as it related to defendants MJM and Cowan. The court, however, took under advisement Erlandson's motion to remand her claims against the defendant Liberty to determine whether those claims are completely preempted by ERISA.

II. ANALYSIS

A. ERISA Preemption Generally

District courts have federal question jurisdiction over civil cases "arising under the Constitution, laws, or treaties of the United States." See 28 U.S.C. § 1331; Frank v. Bear Stearns & Company, 128 F.3d 919, 922 (5th Cir.1997). In determining whether a claim arises under federal law, the well-pleaded complaint rule allows a plaintiff to be the "master to decide what law he will rely upon" in pursuing his claims. The Fair v. Kohler Die & Specialty Company, 228 U.S. 22, 25, 33 S.Ct. 410, 57 L.Ed. 716 (1913); see also Beneficial National Bank v. Anderson, 539 U.S. 1, 6, 123 S.Ct. 2058, 156 L.Ed.2d 1 (2003); Aaron v. National Union Fire Insurance Company of Pittsburg, Pa., 876 F.2d 1157, 1160-61 (5th Cir.1989), cert. denied, 493 U.S. 1074, 110 S.Ct. 1121, 107 L.Ed.2d 1028 (1990). Where potential remedies exist under both state and federal law, a plaintiff may choose to proceed only under state law and avoid federal court jurisdiction. Caterpillar Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987); Carpenter v. Wichita Falls Independent School District, 44 F.3d 362, 366 (5th Cir.1995). "There is an exception to the well-pleaded complaint rule, though, if Congress `so completely preempt[s] a particular area that any civil complaint raising this select group of claims is necessarily federal in character.'" Arana v. Ochsner Health Plan, 338 F.3d 433, 437 (5th Cir.2003) (en banc) (quoting Metropolitan Life Insurance Company v. Taylor, 481 U.S. 58, 63-64, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987)), cert. denied, ___ U.S. ___, 124 S.Ct. 1044, 157 L.Ed.2d 889 (2004).

The Supreme Court has held that state-law claims seeking relief within the scope of ERISA § 502(a)(1)(B)² must be recharacterized as arising under federal law, and, as such, are removable to federal court. Metropolitan Life, 481 U.S. at 60, 66-67, 107 S.Ct. 1542; see also Ramirez v. Inter-Continental Hotels, 890 F.2d 760, 762 (5th Cir.1989). When a claimant seeks relief "within the scope of [ERISA's] civil enforcement provisions," his or her claims are subject to complete preemption. Metropolitan Life, 481 U.S. at 66, 107 S.Ct. 1542. Complete preemption "`recharacterizes' preempted state law claims as `arising under' federal law for the purposes of ... making removal available to the defendant." McClelland v. Gronwaldt, 155 F.3d 507, 516 (5th Cir.1998); see also Johnson v. Baylor University, 214 F.3d 630, 632 (5th Cir.), cert. denied, 531 U.S. 1012, 121 S.Ct. 567, 148 L.Ed.2d 486 (2000).

Another type of preemption, known as "conflict" or "ordinary" preemption, "arises when a federal law conflicts with state law, thus providing a federal defense to a state law claim, but does not completely preempt the field of state law so as to transform a state law claim into a federal claim." Arana, 338 F.3d at 439. Under ERISA's conflict preemption provision, § 514(a), "any and all State laws [are displaced or superceded] insofar as they ... relate to any employee benefit plan." 29 U.S.C. § 1144(a); see also Christopher v. Mobil Oil Corporation, 950 F.2d 1209, 1217 (5th Cir.), cert. denied, 506 U.S. 820, 113 S.Ct. 68, 121 L.Ed.2d 35 (1992). Any state law "relates to" an ERISA plan "if it has a connection with or reference to" an employee benefit plan. Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983).³ Significantly for this case, even if the court were to find that Erlandson's state law causes of action against Liberty relate to an ERISA plan within the meaning of § 514(a), conflict preemption is insufficient to create federal jurisdiction. See McClelland, 155 F.3d at 516-19 (finding that a claim that relates to an ERISA plan, but does not seek to enforce rights under § 502(a), does not create federal removal jurisdiction); Copling v. Container Store, Inc., 174 F.3d 590, 594-95 (5th Cir.1999).⁴ The court will, therefore, only examine the contours of Erlandson's state law claims insofar as they relate to complete preemption.

The Fifth Circuit, in Memorial Hospital System v. Northbrook Life Insurance Company, 904 F.2d 236, 245 (5th Cir.1990), outlined two unifying characteristics of cases finding ERISA preemption of a plaintiff's state law causes of action. See also Hollis v. Provident Life & Accident Insurance Company, 259 F.3d 410, 414 (5th Cir.2001), cert. denied, 535 U.S. 986, 122 S.Ct. 1538, 152 L.Ed.2d 465 (2002); Baylor University Medical Center v. Arkansas Blue Cross Blue Shield, No. 3:03-CV-2084-G, 2004 WL 62582 at *3 (N.D.Tex. Jan. 9, 2004) (Fish, Chief J.). Preemption of a plaintiff's state law causes of action has been found when: (1) the state law claim addresses areas of exclusive federal concern, and (2) the claim directly affects the relationship among traditional ERISA entities — the employer, the plan and its fiduciaries, and the participants and beneficiaries. Memorial Hospital, 904 F.2d at 245; Hollis, 259 F.3d at 414; Baylor, 2004 WL 62582 at *3.

Before analyzing the impact of ERISA's preemption clause on Erlandson's claims, the court hastens to note that "any doubts concerning removal must be resolved against removal and in favor of remanding the case back to state court." Cross v. Bankers Multiple Line Insurance Company, 810 F.Supp. 748, 750 (N.D.Tex.1992); see also Healy v. Ratta, 292 U.S. 263, 270, 54 S.Ct. 700, 78 L.Ed. 1248 (1934) ("Due...