Morgan v. Ameritech, 98-3128.
| Decision Date | 05 November 1998 |
| Docket Number | No. 98-3128.,98-3128. |
| Citation | 26 F.Supp.2d 1087 |
| Parties | Gloria MORGAN, Plaintiff, v. AMERITECH, and Ameritech Sickness and Accident Disability Plan (SADBP), Defendants. |
| Court | U.S. District Court — Central District of Illinois |
James W. Ackerman, Springfield, IL, for plaintiff.
Benjamin Ghess, Chicago, IL, Alfred B. LaBarre, Springfield, IL, for defendants.
Congress giveth,
Congress taketh away.
Jury trial under § 510 of ERISA?
No. It is for nought.
Ameritech Corporation adopted an employee benefit plan called Ameritech Sickness and Disability Benefit Plan ("Plan"). Pursuant to section 4.8 of the Plan, all accident disability benefits paid by the Plan were charged to Ameritech's operating expenses. The Plan provided coverage for employees of Ameritech who had six (6) or more net credited months of service. Moreover, the Plan was subject to regulation under the Employee Retirement Income Securities Act, 29 U.S.C. § 1002(a).
Gloria Morgan was an employee of Ameritech Corporation from 1984 until November 25, 1997 and was eligible to receive benefits under the employee benefits plan. On or about July 2, 1997, Morgan allegedly became sick and disabled. She alleges that her illness qualified her to receive benefits under the employee benefits plan. The Plan, however, provided benefits up through October 7, 1997, and denied benefits after that date. On November 25, 1997, Ameritech discharged Morgan from her employment with the company.
In Count I of her Amended Complaint, Morgan alleges that the Plan's refusal to provide benefits to her after October 7, 1997 constituted a breach of the employee benefits plan. She seeks damages and attorney's fees pursuant to 29 U.S.C. § 1132(g)(1).1 In Count II of the Amended Complaint, Morgan alleges that Ameritech wrongfully discharged her for exercising her rights under the Employee Benefit Plan in violation of 29 U.S.C. § 1140.2
The Defendants filed a motion to Dismiss Count II of the Complaint and to Strike Plaintiff's Jury Demand.
In ruling on a motion to dismiss, the Court must accept well pleaded allegations of the complaint as true. See Hishon v. King & Spalding, 467 U.S. 69, 73-75, 104 S.Ct. 2229, 2233, 81 L.Ed.2d 59 (1984); Car Carriers, Inc. v. Ford Motor Co., 745 F.2d 1101, 1104 (7th Cir.1984), cert. denied, 470 U.S. 1054, 105 S.Ct. 1758, 84 L.Ed.2d 821 (1985). Although a complaint is not required to contain a detailed outline of the claim's basis, it nevertheless must contain either direct or inferential allegations respecting all the material elements necessary to sustain a recovery under some viable legal theory. Car Carriers, 745 F.2d at 1106. Mere conclusions, without supporting factual allegations, are insufficient to support a claim for relief. Cohen v. Illinois Inst. of Tech., 581 F.2d 658, 663 (7th Cir.1978). Dismissal should not be granted unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim that would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957).
The Defendants argue that Plaintiff failed to plead sufficient facts to support her discrimination claim under ERISA. Despite the liberality of modern rules of pleading, plaintiffs may not merely rest on bare legal conclusions. Rather, in order to resist a motion to dismiss they must set out facts sufficient to "outline or adumbrate" the basis for their ERISA claims. Panaras v. Liquid Carbonic Indus., Corp., 74 F.3d 786, 792 (7th Cir.1996); Perkins v. Silverstein, 939 F.2d 463, 466-67 (7th Cir.1991); Sutliff, Inc. v. Donovan Cos., Inc., 727 F.2d 648, 654 (7th Cir.1984); Strauss v. City of Chicago, 760 F.2d 765, 767-70 (7th Cir.1985).
In her Complaint, the Plaintiff states that she was discharged, and that the "basis for the discharge was the exercise of her right under the provisions of the Employee Benefit Plan." Moreover, she alleges that "as a result of the discharge[,] Ameritech now claims it is not liable under the plan." Assuming that the pleadings are true, the Court cannot say it is "beyond a doubt" that the plaintiff can prove no set of facts to establish a violation under ERISA.
Citing a case from our sister court in the Northern District, the Defendants argue that this Court should dismiss her claim because the Plaintiff failed to allege that Ameritech "specifically intended to interfere with her rights under the [Employee Benefits Plan]." Fallico v. Radiology Imaging Specialists, Ltd., No. 95-C-6796, 1996 WL 288630, at *3 . In Fallico, the plaintiff alleged that the defendant violated § 5023 and § 5104 of ERISA by failing to pay her "basic compensation for the first ninety (90) days of disability ...." Id. at *2. The Fallico court dismissed both claims on the ground that the benefit the plaintiff was seeking did not fall within the ambit of ERISA. Id. at *2-3. Because her law suit did not involve rights protected under ERISA, the court held that the plaintiff "failed to provide a basis for a Section 502 claim for improper denial of benefits[][,]" and that the "facts alleged do not indicate intent to interfere with rights under ERISA employee benefit plan." Id.
It appears that the Fallico case turned on the distinction between protected rights and unprotected rights, and not whether plaintiff failed to allege "specific intent" as opposed to any other levels of intent.5 Moreover, unlike the Fallico case, it is undisputed that the benefits claimed by the Plaintiff in Count I of her Amended Complaint falls under ERISA's jurisdiction. The only disputed issue in Count I is whether the Plaintiff was entitled to those benefits after October 7, 1997. Thus, the Court holds that the Fallico case is fundamentally different from the case at bar.
Although the Plaintiff could have pled additional facts, she met the minimum threshold to survive a motion to dismiss. Assuming paragraph 8 is true, the trier of fact could infer that the Defendants discharged the Plaintiff for the "purpose of interfering" with Plaintiff's protected rights.
The Defendants next argue that the timing of discharge "cuts against any inference that [the Plaintiff] was terminated in order to interfere with her rights under the [employee benefits plan]." The Defendants argue that if they intended to interfere with her rights, they would have fired her when she was receiving the benefits or while she had rights under the benefits plan. This argument is unpersuasive. First, in Count I, the Plaintiff argues that she had rights under the benefits plan up until she was discharged from her employment. Assuming her allegations are true, the trier of fact could infer that the Defendants discharged her in order to avoid giving her the benefits.
Second, the Court will not evaluate the strength of the inference on a motion to dismiss. As stated supra, in a motion to dismiss, the Court presumes that all alleged facts are true and construes reasonable inferences in favor of the non-movant. See Car Carriers, 745 F.2d at 1106. Thus, although the timing of the firing weakens the inference of Defendants' motive for discharging the Plaintiff, Count II nevertheless survives a motion to dismiss.
The Defendants also move to strike the Plaintiff's demand for a jury. The Defendants argue that lawsuits filed under ERISA are equitable in nature, and jury trials are not available. In contrast, the Plaintiff argues that she is entitled to a jury because her ERISA § 510 claim, 29 U.S.C. § 1140, is legal in nature. Much judicial ink has been spilled on this issue, and even to this day, the issue is not very lucid. Nevertheless, after examining the case law developed regarding ERISA within the past 5 years, this Court concludes that no jury trial is available under § 510 of ERISA.
A right to trial by jury may arise either by statute or via the Seventh Amendment to the U.S. Constitution. See Curtis v. Loether, 415 U.S. 189, 191-92, 94 S.Ct. 1005, 39 L.Ed.2d 260 (1974). If Congress has provided for the right to trial by jury in a statute, there is no need to examine the constitutional issue. Id. at 192 n. 6, 94 S.Ct. 1005.
Initially, this Court notes that pursuant to statutory language in the last sentence of § 510, the exclusive enforcement provision for an ERISA § 510 claim is under § 502(a), 29 U.S.C. § 1132(a). See Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 142, 111 S.Ct. 478, 485, 112 L.Ed.2d 474, 487 (1990); Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 54, 107 S.Ct. 1549, 1556, 95 L.Ed.2d 39 (1987); Massachusetts Mutual Life Insurance Co. v. Russell, 473 U.S. 134, 146, 105 S.Ct. 3085, 3092, 87 L.Ed.2d 96 (1985). Thus, the plaintiff's alleged rights to back pay, compensatory damages and jury trial must be authorized, if at all, under § 502(a), 29 U.S.C. § 1132(a). Relevant provisions of § 502(a) state the following:
A civil action may be brought —
(1) by a participant or beneficiary — ...
(B) to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan;
. . . . .
(3) by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which violates any provision of this subchapter or the terms of the plan, or (B) to obtain other appropriate equitable relief (i) to redress such violations or (ii) to enforce any provisions of this subchapter or the terms of the plan.
29 U.S.C. § 1132(a).
As one can see, § 502 of ERISA does not explicitly provide or deny a right to trial by jury.6 Moreover, it is questionable whether the Plaintiff could even recover compensatory damages at all under § 502. Since there is no statutory grant or a denial of a jury trial under § 502(a) of ERISA, the Court must now turn to the Seventh Amendment to...
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