Sorosky v. Burroughs Corp.

• Decision Date: 25 August 1987
• Docket Number: No. 85-5707,85-5707
• Citation: 826 F.2d 794
• Court: U.S. Court of Appeals — Ninth Circuit
• Parties: 44 Fair Empl.Prac.Cas. 1180, 44 Empl. Prac. Dec. P 37,328, 2 Indiv.Empl.Rts.Cas. 1112 John J. SOROSKY, Plaintiff-Appellant, v. BURROUGHS CORPORATION, Defendant-Appellee.

Page 794

826 F.2d 794

44 Fair Empl.Prac.Cas. 1180,

44 Empl. Prac. Dec. P 37,328,

2 Indiv.Empl.Rts.Cas. 1112

John J. SOROSKY, Plaintiff-Appellant, v. BURROUGHS CORPORATION, Defendant-Appellee.

No. 85-5707.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted April 10, 1986.

Originally Filed Sept. 2, 1986.

Petition for Rehearing Granted Dec. 30, 1986.

Prior Opinion Withdrawn Per Order Dated Aug. 25, 1987.

New Opinion Filed Aug. 25, 1987.

Memel, Jacobs, Pierno, Gersh & Ellsworth, Marvin M. Lager and Jean Manning, Los Angeles, Cal., for plaintiff-appellant.

Epstein, Becker, Borsody & Green, James P. Mulkeen and Sandra R. King, Los Angeles, Cal. (Thomas H. Williams, Burroughs Corp., Detroit, Mich., of counsel), for defendant-appellee.

Orrick, Herrington & Sutcliffe, Ralph H. Baxter, Jr., for amicus curiae California Employment Law Council.

Appeal from the United States District Court for the Central District of California.

Before WALLACE, PREGERSON and BEEZER, Circuit Judges.

ORDER

The prior opinion in this case, filed September 2, 1986, is hereby withdrawn. The attached opinion is filed in its place.

WALLACE, Circuit Judge:

Sorosky appeals from a district court order granting summary judgment for Burroughs Corporation (Burroughs) in Sorosky's action arising from his termination by Burroughs. We have jurisdiction pursuant to 28 U.S.C. Sec. 1291. We affirm in part and reverse in part.

I

Sorosky began working for Burroughs about 1956. By 1974, Burroughs had promoted Sorosky to the position of Manager of the Systems Documentation Section in its Santa Barbara facility. In 1981, Burroughs closed a major portion of this facility and transferred its two major Santa Barbara projects to Burroughs plants in Mission Viejo and Pasadena. Although many Santa Barbara employees were transferred to other facilities, Sorosky was given only a temporary assignment at the Pasadena plant. The parties dispute whether Burroughs offered Sorosky another permanent job before the temporary assignment ended.

Following his lay-off, Sorosky filed a charge with the California Department of Fair Employment and Housing (DFEH) alleging that Burroughs had fired him because of his age. At the time he was terminated, Sorosky was 55. He received a right-to-sue letter from the DFEH and then brought suit in California state court against Burroughs and Does I-XX. Sorosky pleaded causes of action for breach of contract/wrongful discharge, misrepresentation, breach of the implied covenant of good faith and fair dealing, conspiracy to interfere with a protected property interest, employment discrimination on the basis of age, and declaratory relief.

Burroughs successfully removed the suit to the federal district court, which ultimately granted summary judgment in favor of Burroughs. We review de novo the district court's order granting summary judgment, Lojek v. Thomas, 716 F.2d 675, 677 (9th Cir.1983), to determine whether there is a "genuine issue as to any material fact" and whether "the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). "[T]he [district] judge's function is not to weigh the evidence and determine the truth of the matter but to determine whether there is a genuine issue for trial." An issue is "genuine" if "there is sufficient evidence favoring the nonmoving party for a jury to return a verdict for that party.... If the evidence is merely colorable, ... or is not significantly probative, ... summary judgment may be granted." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 106 S.Ct. 2505, 2511, 91 L.Ed.2d 202 (1986) (citations omitted).

II

Sorosky challenges the district court's jurisdiction, contending that removal was improper. We must first consider whether Sorosky has preserved his challenge to removal.

A.

"[W]here after removal a case is tried on the merits without objection and the federal court enters judgment, the issue in subsequent proceedings on appeal is not whether the case was properly removed, but whether the federal district court would have had original jurisdiction of the case had it been filed in that court." Grubbs v. General Electric Credit Corp., 405 U.S. 699, 702, 92 S.Ct. 1344, 1347, 31 L.Ed.2d 612 (1972) (Grubbs ). The Grubbs rule applies when, as in the present case, the merits are reached and determined on a motion for summary judgment. Stone v. Stone, 632 F.2d 740, 742 (9th Cir.1980), cert. denied, 453 U.S. 922, 101 S.Ct. 3158, 69 L.Ed.2d 1004 (1981).

Sorosky contends that he complied with the Grubbs requirement of an "objection" because he unsuccessfully moved to remand the action to the state court. In response, Burroughs contends that Sorosky has not preserved his objection to removal because he failed to seek an interlocutory appeal of the district court's order denying his motion to remand. Our prior cases require him to do so. See Gould v. Mutual Life Insurance Co., 790 F.2d 769, 774 (9th Cir.), cert. denied, --- U.S. ----, 107 S.Ct. 580, 93 L.Ed.2d 582 (1986); Lewis v. Time Inc., 710 F.2d 549, 552 (9th Cir.1983); Sheeran v. General Electric Co., 593 F.2d 93, 97-98 (9th Cir.), cert. denied, 444 U.S 868, 100 S.Ct. 143, 62 L.Ed.2d 93 (1979). Sorosky argues, however, that the Supreme Court implicitly held in Franchise Tax Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983) (Franchise Tax ), that a litigant need not apply for an interlocutory appeal to preserve an attack on removal jurisdiction. The Court in that case considered a challenge to removal, but did not mention Grubbs or state whether the plaintiff had applied for an interlocutory appeal. From these circumstances, Sorosky infers that an interlocutory appeal is unnecessary. When, however, the Court fails explicitly to address an issue, we cannot assume that the Court implicitly addressed the issue and made a determination on the merits. We conclude, therefore, that the Supreme Court has not ruled on the question, and we are bound by our precedent. Because Sorosky did not seek an interlocutory appeal of the order denying his motion to remand, the only issue before us is whether the district court would have had jurisdiction if this case originally had been filed in that court.

B.

Burroughs identifies two separate bases of original jurisdiction for the district court, diversity of citizenship, 28 U.S.C. Sec. 1332, and the existence of a federal question, 28 U.S.C. Sec. 1331. Because we conclude that federal question jurisdiction exists, it is unnecessary for us to consider diversity.

Jurisdiction under 28 U.S.C. Sec. 1331 exists when a civil action arises under federal law. "[A] cause of action arises under federal law only when the plaintiff's well-pleaded complaint raises issues of federal law." Metropolitan Life Insurance Co. v. Taylor, --- U.S. ----, 107 S.Ct. 1542, 1546, 95 L.Ed.2d 55 (1987) (Metropolitan Life ). Burroughs contends that Sorosky's complaint raises issues of federal law because some or all of his state claims are preempted by the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. Secs. 1001-1461. Ordinarily, however, federal preemption is a defense. As such, it does not appear on the face of a well-pleaded complaint, and therefore does not provide federal question jurisdiction. See Metropolitan Life, 107 S.Ct. at 1546.

Civil claims that are preempted by ERISA and that are redressable under ERISA section 502(a), 29 U.S.C. Sec. 1132(a), however, are excepted from this general rule because Congress has "so completely" preempted this area "that any civil complaint raising [section 502(a) ] claims is necessarily federal in character." Id. We recognize that Metropolitan Life involved a claim under section 502(a)(1)(B) of ERISA, 29 U.S.C. Sec. 1132(a)(1)(B). It is clear from the Court's analysis in Metropolitan Life, however, that the same rule is applicable to the section 502(a)(3) claims alleged in this case as well. Id. at 1547; see also H.R.Conf.Rep. No. 93-1280, p. 327 (1974), U.S.Code Cong. & Admin.News 1974, p. 4639. Therefore, our determination of the jurisdictional question turns on whether Sorosky's claim is preempted, and if so, whether his claims can be redressed under section 502(a).

The preemption issue seems clear to us. Under ERISA's "virtually unique pre-emption provision," Franchise Tax, 463 U.S. at 24 n. 26, 103 S.Ct. at 2854 n. 26, with certain limited exceptions, ERISA "shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan described in [section 4(a) of ERISA] and not exempt under [section 4(b) of ERISA]." ERISA Sec. 514(a), 29 U.S.C. Sec. 1144(a). Burroughs's employee benefit plan falls within the scope of ERISA Sec. 4(a), 29 U.S.C. Sec. 1003(a), and is not exempt under section 4(b), 29 U.S.C. Sec. 1003(b). Sorosky's claims are therefore preempted insofar as they "relate to" the employee benefit plan of Burroughs. Congress intended that the words "relate to" be interpreted broadly. Pilot Life Insurance Co. v. Dedeaux, --- U.S. ----, 107 S.Ct. 1549, 1553, 95 L.Ed.2d 39 (1987); Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 98-99, 103 S.Ct. 2890, 2900-01, 77 L.Ed.2d 490 (1983) (Shaw ). State law causes of action relate to an employee benefit plan if they have "a connection with or reference to such a plan." Shaw, 463 U.S. at 97, 103 S.Ct. at 2900.

Sorosky initially pleaded six claims, but he does not challenge the summary judgment entered with respect to his second (misrepresentation) and sixth (declaratory relief) claims. His first claim for "breach of contract/wrongful discharge" actually includes several different theories. Certain of the allegations frame a theory relating to Burroughs's employee benefit plan. In substance, Sorosky alleges that Burroughs agreed in writing to provide him with monthly retirement benefits and then sought to prevent him from acquiring those benefits. To the extent that this first claim refers to the...