Jackson v. Roseman

• Decision Date: 21 February 1995
• Docket Number: Civ. No. N-94-3184.
• Citation: 878 F. Supp. 820
• Parties: Merle JACKSON, Plaintiff, v. Barry ROSEMAN, D.M.D., M.D., Defendant, MD-Independent Practice Associates, Inc., t/a MD-IPA, Defendant, and Mid Atlantic Medical Services, Inc., Defendant. Merle JACKSON, Plaintiff, v. Barry ROSEMAN, D.M.D., M.D., et al., Defendants.
• Court: U.S. District Court — District of Maryland

878 F. Supp. 820

Merle JACKSON, Plaintiff, v. Barry ROSEMAN, D.M.D., M.D., Defendant, MD-Independent Practice Associates, Inc., t/a MD-IPA, Defendant, and Mid Atlantic Medical Services, Inc., Defendant.

Merle JACKSON, Plaintiff, v. Barry ROSEMAN, D.M.D., M.D., et al., Defendants.

Civ. No. N-94-3184.

United States District Court, D. Maryland.

February 21, 1995.

Louis G. Close, Jr., and Jonathan Schochor, Schochor, Federico & Staton, and Elizabeth Diane Martin Littlepage, Baltimore, MD, for plaintiff.

Robert C. Morgan, Mason, Ketterman and Morgan, Baltimore, MD, and David E. Manoogian, Epstein, Becker and Green, Washington, DC, for defendants.

MEMORANDUM

NORTHROP, Senior District Judge.

The instant action brings for resolution before this Court a petition for removal by Defendants MD-Individual Practice Associates, Inc., t/a MD-IPA and Mid Atlantic Services, Inc. (collectively "MD-IPA"), a motion to remand by Defendant Dr. Barry Roseman ("Dr. Roseman"), and a motion to remand by Plaintiff Merle Jackson ("Jackson"). MD-IPA has filed an opposition to Jackson's motion to remand. No hearing is necessary. Local Rule 105.6 (D.Md.1992, as amended 1994). For the following reasons, MD-IPA's petition for removal shall be dismissed, and Dr. Roseman's and Jackson's motions to remand shall be granted.

I. Background

In October 1994 Jackson filed a complaint of medical malpractice against Dr. Roseman and MD-IPA in the Maryland Health Claims Arbitration Office. On November 16, 1994, MD-IPA filed in this Court a petition for removal on the basis that Jackson's state claims against MD-IPA arise under and are preempted by the federal Employee Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et seq. ("ERISA").

On February 10, 1995, this Court granted a motion by Jackson to amend the complaint so as to add Defendant Dr. Sheelmohan Sachdev to his suit. At present, Jackson's amended one-count complaint generally alleges medical negligence on the part of Drs. Roseman and Sachdev and MD-IPA. MD-IPA is a health maintenance organization ("HMO") with whom Jackson's employer has contracted for the provision of employee health benefits through an employee welfare benefit plan. Drs. Roseman and Sachdev are individual providers under the plan.

Jackson's complaint specifically avers that the negligence of Drs. Roseman and Sachdev in allowing the growth and ultimate metastasis of a malignant cancer in his mouth caused him severe and permanent injury. With regard to MD-IPA, the gravamen of Jackson's claim is that the corporate Defendant is vicariously liable for the doctors' negligent acts.¹ Paragraph 13 of the complaint reinforces the reading that whatever negligence is attributable to MD-IPA is predicated wholly on the actions of Drs. Roseman and Sachdev. Consistent with that interpretation, MD-IPA argues throughout its removal petition and opposition memoranda that vicarious liability forms a sufficient basis for removal in this case.

II. The Complaint

Jackson's complaint only asserts what are facially state common law claims. Accordingly, in order properly to address the subject-matter jurisdiction question, this Court must first apply the well-pleaded-complaint rule. The well-pleaded-complaint rule restricts the search for a basis of federal question jurisdiction to "what necessarily appears in the plaintiff's statement of his own claim in the bill or declaration, unaided by anything alleged in anticipation or avoidance of defenses which it is thought the defendants may interpose." Taylor v. Anderson, 234 U.S. 74, 75-76, 34 S.Ct. 724, 724, 58 L.Ed. 1218 (1914).

"One corollary of the well pleaded complaint rule developed in case law, however, is that Congress may so completely preempt a particular area that any civil complaint raising this select group of claims is necessarily federal in character." Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64, 107 S.Ct. 1542, 1546, 95 L.Ed.2d 55 (1987). The Supreme Court in Metropolitan held that state-common-law claims which were in the nature of ERISA civil enforcement actions governed by 29 U.S.C. § 1132(a)(1) would be treated as federal claims.²

Thus construing the complaint in a manner consistent with MD-IPA's principal contention that this Court possesses original subject-matter jurisdiction over the instant action due to the preemption of Jackson's state-law claim of vicarious liability, we next examine the applicable law.

III. Preemption of State Claims

Congress' passage of ERISA was meant to serve as the enactment of a comprehensive statute for the regulation of, among other things, employee welfare benefit plans that, "through the purchase of insurance or otherwise," provide medical, surgical, or hospital care, or benefits in the event of sickness, accident, disability or death. 29 U.S.C. §§ 1001 et seq.; Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 137, 111 S.Ct. 478, 482, 112 L.Ed.2d 474 (1990), citing Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 90, 103 S.Ct. 2890, 2896, 77 L.Ed.2d 490 (1983). Section 514(a) of ERISA, as codified in 29 U.S.C. § 1144(a), establishes the statute's broad preemptive power over "all State laws insofar as they may now or hereafter relate to any employee benefit plan."

The parties do not dispute that the plan offered to Jackson and his colleagues is an employee benefit plan governed by ERISA. The relevant question, then, is whether Jackson's state-law claim of vicarious liability sufficiently "relates to" his employment benefit plan in a way that requires preemption.

Whether or not ERISA preempts Jackson's state claim against MD-IPA is a question whose answer depends, ultimately, on legislative intent. Ingersoll-Rand, 498 U.S. at 137-38, 111 S.Ct. at 482; Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 747, 105 S.Ct. 2380, 2393, 85 L.Ed.2d 728 (1985). To give proper effect to congressional intent, this Court must, in its consideration of whether a law "relates to" an employee benefit plan within the meaning of § 514(a) of ERISA, apply a broad common-sense meaning to the term. Id. at 747, 105 S.Ct. at 2393. See also FMC Corp. v. Holliday, 498 U.S. 52, 58, 111 S.Ct. 403, 407-08, 112 L.Ed.2d 356 (1990); Shaw, 463 U.S. at 97, 103 S.Ct. at 2900.

Where a state law "has a connection with or reference to" an employee benefit plan and relates to it in the "normal sense of the phrase," it will be considered preempted. Id. at 97, 103 S.Ct. at 2900; Ingersoll-Rand, 498 U.S. at 133, 111 S.Ct. at 478. Indeed, even a state law which is not specifically designed to affect a benefit plan or whose effect on it is only indirect may be found to relate to it for preemption purposes. Id. at 139, 111 S.Ct. at 483; Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 47, 107 S.Ct. 1549, 1552-53, 95 L.Ed.2d 39 (1987). In short, a state-law claim whose governing law has no impact on an employee benefit plan but which is invoked by a beneficiary claiming relief for injuries arising out of the administration of the plan, such as the mishandling of benefit claims or other maladministrations of a plan, "relates to" such a plan. Powell v. Chesapeake & Potomac Telephone Co. of Va., 780 F.2d 419, 421-22 (4th Cir. 1985), cert. denied, 476 U.S. 1170, 106 S.Ct. 2892, 90 L.Ed.2d 980 (1986); Pomeroy v. Johns Hopkins Medical Services, Inc., 868 F.Supp. 110, 112 (D.Md.1994).

The Supreme Court has, however, recognized that the preemptive effect of ERISA will be circumscribed in those cases where a state law relates to ERISA in "too tenuous, remote or peripheral a manner to warrant a finding that it relates to the plan." Shaw, 463 U.S. at 100 n. 21, 103 S.Ct. at 2901 n. 21. Similarly, "lawsuits against ERISA plans for run-of-the-mill claims such as unpaid rent, failure to pay creditors, or even torts committed by an ERISA plan," are examples of causes of actions that will not be preempted by Section 514(a). Mackey v. Lanier Collection Agency and Serv., Inc., 486 U.S. 825, 833, 108 S.Ct. 2182, 2187, 100 L.Ed.2d 836 (1988).³

IV. Preemption Analysis

MD-IPA broadly contends that "a medical malpractice claim against an HMO is really nothing more than a complaint about the administration of claims under the welfare benefit plan." Petition for Removal at 3. The crux of the Defendant's position, however, is that because Jackson has sued under a theory of vicarious liability,⁴ his claim sufficiently "relates to" the employee welfare benefit plan and therefore implicates ERISA and this Court's subject-matter jurisdiction.⁵

In support of this argument, the Defendant corporations rely primarily on Pomeroy, supra, which concerned, as stated by the Pomeroy Court, allegations that "essentially" related to the administration of the plaintiffs' claims under the benefit plan. 868 F.Supp. at 113. Indeed, this Court concurs with MD-IPA's view that the principal facts and charges in Pomeroy involved the HMO's own refusal to pay for treatment and its negligent selection of health care providers. Id. at 113-14. There is no doubt that the gravamen of the plaintiffs' claim there was directed at the HMO defendant's failure properly to administer the beneficiary's benefits and asserted the HMO's negligence as the primary cause of injury. No such claim is present in the instant complaint.

However, the Court in Pomeroy also held that the plaintiffs' claim of vicarious liability was related to a duty that was created and imposed by the benefit plan and, as such, was subject to scrutiny under ERISA.⁶ Relying on Dukes v. U.S. Health Care Systems of Pennsylvania, 848 F.Supp. 39 (E.D.Pa.1994), the Court concluded that even under a theory of vicarious responsibility the benefit plan would have to be examined to determine what representations were made to the plaintiffs with regard to whether the HMO "held out" the doctors as its employees. Pomeroy, 868 F.Supp. at 113. Indeed, the relevant language of Dukes states emphatically:

A medical malpractice claim against an HMO, whether couched in

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