Van Lier v. Unisys Corp.

• Citation: 142 F.Supp.3d 477
• Decision Date: 22 October 2015
• Docket Number: Case No. 1:15–cv–974.
• Court: U.S. District Court — Eastern District of Virginia
• Parties: Anna VAN LIER, Plaintiff, v. UNISYS CORPORATION, Defendant.

142 F.Supp.3d 477

Anna VAN LIER, Plaintiff,

v.UNISYS CORPORATION, Defendant.

Case No. 1:15–cv–974.

United States District Court, E.D. Virginia, Alexandria Division.

Signed Oct. 22, 2015.

Patricia A. Smith, Law Offices of Patricia A. Smith, Alexandria, VA, for Plaintiff.

Andrew George Sakallaris, Morgan Lewis Bockius, LLP, Washington, DC, for Defendant.

MEMORANDUM OPINION

T.S. ELLIS, III, District Judge.

Plaintiff in this case filed her complaint initially in state court, alleging that defendant, her employer, committed constructive fraud and negligence by representing to plaintiff that she was not eligible for coverage under defendant's Long Term Disability Plan ("LTD Plan") when, in fact, she was eligible. Defendant removed the case to federal court on federal question and diversity grounds and also filed a motion to dismiss on the ground that plaintiff's Virginia common law constructive fraud and negligence claims are preempted by the Employee Retirement Income Security Act ("ERISA"). 29 U.S.C. §§ 1001 et seq. Plaintiff opposed the motion to dismiss and filed a motion to remand. The matter was briefed, and following oral argument, an Order issued (i) finding that ERISA preempted plaintiff's state law claims and that diversity jurisdiction exists, (ii) denying plaintiffs motion to remand, and (iii) granting defendant's motion to dismiss the complaint with leave for plaintiff to amend the complaint with her ERISA claims. This Memorandum Opinion records and elucidates the reasons for denying plaintiff's motion to remand and granting defendant's motion to dismiss plaintiff's complaint with leave to amend.

I.

The pertinent facts may be succinctly stated.¹ Plaintiff, Anna Van Lier, a resident of Virginia, was employed by defendant, Unisys Corporation, a Delaware Corporation with its principal place of business in Pennsylvania that is engaged in the global business of providing information technology services to government entities and private companies.

Plaintiff commenced employment with defendant on September 10, 2012, as a Marketing Manager in defendant's Federal Systems Division. More than five years prior to her employment with defendant, plaintiff was diagnosed with Stage 2A breast cancer. Following surgery and treatment, a PET Scan in February 2008 confirmed she was cancer free. When plaintiff began employment with defendant, she had been cancer free for over four years.

On her first day of employment with defendant, plaintiff reported to defendant's office in Reston, Virginia, where she received, and was told to complete, various Human Resources documents. Included in these documents were applications to participate in benefits programs that defendant provided its employees. One of these plans was the LTD Plan, which defendant had insured by contract with Aetna Life Insurance. An employee could elect to register for the LTD Plan, but the employee would be responsible for the premiums for coverage.

At the time, plaintiff did not elect the plan to register for the LTD Plan, but on or about October 25, 2012, during plaintiff's first available open enrollment period, plaintiff telephoned Donna Brown, defendant's Global Director of Benefits, who is responsible for managing defendant's benefits programs. In light of her history of cancer, plaintiff was unsure if she would be eligible for coverage under the LTD Plan. In the course of her telephone conversation with Brown, plaintiff inquired of Brown whether plaintiff would be eligible for LTD coverage, disclosing to Brown her cancer history and explaining that she had been cancer free for over four years. Brown responded to plaintiff's eligibility query by telling plaintiff that Aetna would not likely approve her because of her pre-existing conditions. Brown asked plaintiff rhetorically why she would want to pay premiums when she would not receive any benefit from the plan. Contrary to Brown's representation, however, plaintiff was eligible at that time for the LTD Plan. In reliance on Brown's representation and recommendation, plaintiff did not sign up for the LTD Plan, although she did sign up for all other benefits programs offered by defendant.

Thereafter, in January 2013, plaintiff learned her breast cancer had returned and spread to her brain, lungs, liver, and bones. As a result, plaintiff became unable to work a five-day work week. Beginning February 8, 2013, plaintiff worked three days and was in treatment two days each week. Plaintiff continued to follow this schedule for several months.

On July 11, 2013, plaintiff met with her supervisor, Laura Osburnsen, the director of Benefits and Human Resources, Beth Cironi, and the Vice President of Human Resources, Lee Stratten, about going on Short Term Disability full time. During the meeting, plaintiff recounted her conversation with Brown. Stratten told plaintiff that Brown's representations were incorrect and that plaintiff had indeed been eligible for the LTD Plan at the time she made her initial inquiry. But Stratten also informed plaintiff that, because of plaintiff's recent diagnosis, she was no longer eligible for the LTD Plan given the plan's pre-existing condition exclusion clause. After the meeting, Osbumsen provided plaintiff with a copy of the Summary Plan Description for defendant's Flexible Benefits Program, which described the LTD Plan but did not mention the pre-existing condition exclusion clause.

In October 2013, plaintiff returned to work full time, but was unable to work more than two weeks before returning to Short Term Disability status. Thereafter, on March 11, 2014, Aetna sent plaintiff a letter stating that plaintiff met the definition of disability under the LTD Plan. On March 28, 2014, Aetna sent plaintiff a revised letter stating that she would not receive LTD benefits because the information Aetna received from defendant indicated that plaintiff did not elect LTD coverage.

Plaintiff filed a complaint against defendant in the Circuit Court for Fairfax County, Virginia, on July 9, 2015, asserting two claims for relief: (i) constructive fraud and (ii) negligence. With respect to her constructive fraud claim, plaintiff alleges that defendant, by its agent and employee Brown, made a false representation of material fact, innocently or negligently, that plaintiff was not eligible for coverage under the LTD Plan because of her history of cancer. With respect to her negligence claim, plaintiff alleges that Brown, while acting within the scope of her employment, was negligent in making false statements to plaintiff about her eligibility for long term disability insurance coverage. Plaintiff claims that, as a result of Brown's misrepresentation and negligence, she lost the protection of the LTD Plan in the amount of $3,500 per month in non-taxable income, which would have continued to accrue for as long as plaintiff remains disabled.

On July 30, 2015, defendant removed this case to the United States District Court for the Eastern District of Virginia. Defendant then promptly filed a motion to dismiss under Rule 12(b)(6), Fed.R.Civ.P., on the ground that plaintiffs Virginia common law claims are preempted by ERISA. Plaintiff opposed this motion to dismiss and moved to remand the case to state court.

II.

Analysis properly begins by considering whether this case should be remanded to state court. Federal law allows for removal of "any civil action brought in a State court of which the district courts of the United States have original jurisdiction." 28 U.S.C. § 1441(a). The party who removed the action to federal court "bears the burden of demonstrating that removal jurisdiction is proper." In re Blackwater Sec. Consulting, LLC, 460 F.3d 576, 583 (4th Cir.2006). Federal courts have original jurisdiction over two types of cases: (i) those involving citizens of different states where the amount in controversy exceeds $75,000, pursuant to 28 U.S.C. § 1332 ; and (ii) those involving federal questions pursuant to 28 U.S.C. § 1331. If the party who removed the case cannot demonstrate either basis for original jurisdiction, remand is required.

Here, defendant has demonstrated both diversity jurisdiction and federal question jurisdiction. Diversity jurisdiction exists because (i) plaintiff's complaint prays for more than $2 million, easily clearing the $75,000 threshold and (ii) the parties are diverse, as plaintiff is a citizen of Virginia, and defendant is incorporated in Delaware and has its principal place of business in Pennsylvania.

The Supreme Court has recently held that a corporation's "principal place of business" is "the place where the corporation's high level officers direct, control, and coordinate the corporation's activities." Hertz Corp. v. Friend, 559 U.S. 77, 80, 130 S.Ct. 1181, 175 L.Ed.2d 1029 (2010). Put differently, a corporation's "principal place of business" is its "nerve center," which "will typically be found at a corporation's headquarters." Id. To locate a corporation's "nerve center," the Fourth Circuit has looked to where a majority of corporate officers conduct their business. See Central West Virginia Energy Co. v. Mountain State Carbon, LLC,

636 F.3d 101, 104–05 (4th Cir.2011) (finding it persuasive that seven of eight corporate officers, "including [the corporation's] chief executive officer, chief operating officer, chief financial officer, and general counsel and secretary" conducted business in Dearborn, Michigan). Other relevant factors include the location listed on a corporation's corporate filing documents, id. at 107, and the location at which officers "make significant corporate decisions and set corporate policy," Hoschar v. Appalachian Power Co., 739 F.3d 163, 172 (4th Cir.2014).

Here, defendant's principal place of business is clearly Blue Bell, Pennsylvania. Not only is defendant's headquarters located there, but in addition to this, the majority of defendant's high-level, executive officers are based in Blue Bell. Defendant's leadership is composed of eleven...