Pervel Industries v. STATE OF CONN., ETC.

• Decision Date: 16 October 1978
• Docket Number: Civ. No. H-78-459.
• Court: U.S. District Court — District of Connecticut
• Parties: PERVEL INDUSTRIES, INC. v. STATE OF CONNECTICUT COMMISSION ON HUMAN RIGHTS AND OPPORTUNITIES et al.

468 F. Supp. 490

PERVEL INDUSTRIES, INC. v. STATE OF CONNECTICUT COMMISSION ON HUMAN RIGHTS AND OPPORTUNITIES et al.

Civ. No. H-78-459.

United States District Court, D. Connecticut.

October 16, 1978.

Thomas M. Cloherty, Murtha, Cullina, Richter & Pinney, Hartford, Conn., for plaintiff.

Christine G. Dunnell, Asst. Atty. Gen., Philip A. Murphy, Jr., Commission Counsel State Commission on Human Rights and Opportunities, Hartford, Conn., for defendants.

MEMORANDUM OF DECISION

NEWMAN, District Judge.

This case presents the question of whether the Employee Retirement Income Security Act of 1974 (ERISA) preempts provisions of a state's anti-discrimination law insofar as that law affects employee welfare benefits.

Plaintiff and the union that represents its production and maintenance employees have collectively bargained for the establishment of an employee welfare benefit plan, which is regulated pursuant to ERISA. Among the benefits provided by the plan are disability benefits. Two employees, defendants in this action, applied for disability benefits for leaves of absence granted because of pregnancy. When benefits were refused, the employees filed complaints before the Connecticut Commission on Human Rights and Opportunities (CCHRO). A staff representative of the CCHRO notified plaintiff that the plan's failure to treat pregnancy as a nonoccupational disability constituted sex discrimination. Conn.Gen.Stat. § 31-126(g) prohibits an employer from denying an employee, "who is disabled as a result of pregnancy, any compensation to which she is entitled as a result of the accumulation of disability or leave benefits accrued pursuant to plans maintained" by the employer. On the basis of this view, a hearing has been ordered by the CCHRO, now scheduled for October 17, 1978. Plaintiff has brought this suit against the CCHRO, its director, the Connecticut Attorney General, and the two employees, seeking declaratory and injunctive relief to halt the administrative proceedings. Plaintiff has moved for summary judgment, and there are no material facts in dispute.

Section 514(a) of ERISA, 29 U.S.C. § 1144(a), provides that the provisions of subchapter I, concerning protection of employee benefit rights, "shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan . . .." The broad sweep of this language and the deliberate Congressional intention to accomplish broad preemption has recently been reviewed by this Court. National Carriers' Conference Committee v. Heffernan, 454 F.Supp. 914 (D.Conn.1978). It was there pointed out that Congress made a clear-cut decision not to identify various subjects on which state laws were to be preempted, but instead sought to avoid constant litigation over the scope of preemption by preempting, with certain specific exceptions, "all" state laws insofar as they "relate" to plans covered by ERISA. Plainly Connecticut's anti-discrimination law, legislating specifically on the subject of disability benefits, is a law that relates to an employee benefit plan. This Court therefore disagrees with the conclusion reached in Bucyrus-Erie Co. v. Department of Industry, Labor and Human Relations, 453 F.Supp. 75 (E.D.Wis.1978), that preemption of state anti-discrimination laws has not occurred because ERISA did not expressly provide that state fair employment laws are superseded. While preemption by implication is not favored, see Florida Lime & Avocado Growers, Inc. v. Paul, 373 U.S. 132, 83 S.Ct. 1210, 10 L.Ed.2d 248 (1963), there is no requirement that Congress identify the several categories of state laws it wishes to preempt. Having elected to preempt all laws relating to covered plans, and to specify the categories of state laws that are not preempted, 29 U.S.C. § 1144(b)(2)(A), (b)(4), Congress is entitled to have its clearly expressed intentions carried out.

Nor is there merit in defendants' contention that ERISA preempts only those state laws that deal with the specific subjects covered by subchapter I of ERISA. This claim is refuted by the provisions of § 514(b)(4), explicitly excepting from preemption "any generally applicable criminal law of a State." If Congress had thought that only state laws specifically dealing with the subjects covered by subchapter I of ERISA were to be preempted by § 514(a), it would not have had to preserve generally applicable criminal laws, since they would not have been preempted in the first place. The exception to preemption for generally applicable criminal laws becomes necessary only when it is understood that, without such an exception, § 514(a) preempts all state laws that relate to covered plans, whether the relation arises because a state law is specifically designed to affect such plans or because, as in this case, a state law of general application includes covered plans within its sweep.

Defendants also contend that § 514 does not accomplish preemption of Connecticut's anti-discrimination law because of the interaction of § 514(d) and provisions of Title VII of the Civil Rights Act of 1964, 42 U.S.C. § 2000e et seq. Section 514(d), 29 U.S.C. § 1144(d), provides: "Nothing in this subchapter shall be construed to alter, amend, modify, invalidate, impair, or supersede any law of the United States . .." Section 708 of Title VII, 42 U.S.C. § 2000e-7 provides: "Nothing in this subchapter shall be deemed to exempt or relieve any person from any liability, duty, penalty, or punishment provided by any present or future law of any State . .." The argument is that ERISA does not supersede any federal law, Title VII preserves state anti-discrimination laws from preemption by Title VII, and "therefore" ERISA does not preempt state anti-discrimination laws. The argument has found favor with one district court, Bucyrus-Erie Co., supra, and with two state courts, Goodyear Tire & Rubber Co. v. Department of Industry, Labor, and Human Relations, 87 Wis.2d 56, 273 N.W.2d 786, 16 EPD ¶ 8163 (Circ.Ct. Dane County, Wis., 1978), and Lukus v. Westinghouse Electric Corp. (unreported) (Ct.Common Pleas, Allegheny Cty., Pa. Apr. 20, 1978),¹ and been implicitly rejected by another state court, Gast v. Oregon (unreported) (Circ.Ct. Multnomah Cty., Ore. Nov. 16, 1977).

This Court does not accept the reasoning of this double savings clause contention. Section 514(d) of ERISA preserves federal law. Connecticut's anti-discrimination law does not become a federal law simply because Title VII preserves its validity as against a claim of preemption by Title VII. Nor is the textual argument significantly enhanced by focusing on § 514(b)'s requirement that ERISA should not be construed to "impair" any law of the United States. Preemption of Conn.Gen.Stat. § 31-126(g) by ERISA does not impair any federal law. Title VII did not create new authority for state anti-discrimination laws; it simply left them where they were before the enactment of Title VII. Whatever is prohibited by Title VII remains prohibited under ERISA, but exclusion of disability benefits for pregnancy does not violate Title VII, Gilbert v. General Electric Corp., 429 U.S. 125, 97 U.S. 401, 50 L.Ed.2d 343 (1976).

Defendants stress the...