Wilson v. Zoellner

• Decision Date: 21 May 1997
• Docket Number: No. 96-3170,96-3170
• Citation: 114 F.3d 713
• Parties: , 21 Employee Benefits Cas. 1222 Candace J. WILSON, Appellant, v. Wayne ZOELLNER, Appellee.
• Court: U.S. Court of Appeals — Eighth Circuit

Page 713

114 F.3d 713

65 USLW 2770, 21 Employee Benefits Cas. 1222

Candace J. WILSON, Appellant, v. Wayne ZOELLNER, Appellee.

No. 96-3170.

United States Court of Appeals Eighth Circuit.

Submitted Jan. 14, 1997.

Decided May 21, 1997.

J. Michael Payne, Cape Girardeau, MO, argued (David W. Terry, on the brief), for appellant.

Richard J. Puatler, St. Louis, MO, argued (Lewis R. Mills, on the brief), for appellee.

Before WOLLMAN, HEANEY, and MAGILL, Circuit Judges.

MAGILL, Circuit Judge.

After unsuccessfully bringing suit against The Prudential Insurance Company (Prudential) to recover medical expenses under an insurance policy, see Wilson v. Prudential Ins. Co., 97 F.3d 1010 (8th Cir.1996), Candace J. Wilson brought this action in Missouri state court against Wayne J. Zoellner for Zoellner's alleged negligent misrepresentation of the scope of coverage of the insurance policy. Zoellner removed the case to the United States District Court for the Eastern District of Missouri. The district court dismissed the Missouri state common-law tort action on the basis of the Employee Retirement Income Security Act's (ERISA) preemption clause, see 29 U.S.C. § 1144(a) (1994), and Wilson now appeals. Because we conclude that Wilson's action has not been preempted by ERISA, we reverse.

I.

Wilson worked for Midway Dairy Farms II (Midway) in Missouri as an agricultural laborer. During the summer of 1993, Zoellner, working as an agent for Prudential, sold Midway a health insurance policy from Prudential for Midway's employees. Wilson alleges that Midway specifically sought a policy that would cover work-related injuries and that Zoellner misrepresented to Midway that the Prudential policy would cover such injuries.

On August 22, 1994, Wilson was severely injured while working at Midway. As a result of her injuries, Wilson was paralyzed and incurred significant and ongoing medical expenses. Prudential denied benefits to Wilson because its policy with Midway excluded coverage for work-related injuries. Wilson brought suit against Prudential in federal court to recover under the policy, and this Court held that Prudential had correctly interpreted the policy and had properly denied benefits. See Wilson, 97 F.3d at 1011.

On February 20, 1996, Wilson brought this Missouri state common-law tort action in the Circuit Court of Cape Girardeau County, Missouri, against agent Zoellner to recover damages for Zoellner's alleged negligent misrepresentations regarding the Prudential policy's scope of coverage. Zoellner removed the case to the United States District Court for the Eastern District of Missouri, alleging that Wilson's claims were preempted by ERISA. The district court granted summary judgment to Zoellner on July 17, 1996, holding that Wilson's claims were preempted by ERISA. Wilson now appeals.

II.

Wilson argues that the district court incorrectly held that ERISA preempted her Missouri state common-law tort claim against Zoellner for negligent misrepresentation. We agree. "We review the District Court's decision on ERISA preemption de novo because it is a question of federal law involving statutory interpretation." In Home Health, Inc. v. Prudential Ins. Co., 101 F.3d 600, 604 (8th Cir.1996).

ERISA, codified at 29 U.S.C. §§ 1001-1461 (1994), "is a comprehensive statute that sets certain uniform standards and requirements for employee benefit plans." Arkansas Blue Cross & Blue Shield v. St. Mary's Hosp., Inc., 947 F.2d 1341, 1343 n. 1 (8th Cir.1991) (Arkansas Blues ). Congress enacted ERISA to

protect interstate commerce and the interests of participants in employee benefit plans and their beneficiaries, by requiring the disclosure and reporting to participants and beneficiaries of financial and other information with respect thereto, by establishing standards of conduct, responsibility, and obligation for fiduciaries of employee benefit plans, and by providing for appropriate remedies, sanctions, and ready access to the Federal courts.

29 U.S.C. § 1001(b) (1994). To meet the goals " 'of a comprehensive and pervasive Federal interest and the interests of uniformity with respect to interstate plans,' " Congress included an express preemption clause in ERISA for " 'the displacement of State action in the field of private employee benefit programs.' " Morstein v. National Ins. Servs., Inc., 93 F.3d 715, 719 n. 6 (11th Cir.1996) (en banc) (Morstein II ) (quoting 120 Cong.Rec. 29,942 (1974) (comments by Senator Javits)), cert. denied, --- U.S. ----, 117 S.Ct. 769, 136 L.Ed.2d 715 (1997).

ERISA's preemption clause provides:

Except as provided in subsection (b) of this section, the provisions of this subchapter and subchapter III of this chapter shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan described in section 1003(a) of this title and not exempt under section 1003(b) of this title....

29 U.S.C. § 1144(a) (emphasis added). In analyzing this clause, the Supreme Court has "long acknowledged that ERISA's pre-emption provision is clearly expansive." California Division of Labor Standards Enforcement v. Dillingham Constr., 519 U.S. 316, ----, 117 S.Ct. 832, 837, 136 L.Ed.2d 791 (1997) (quotations and citations omitted). The Supreme Court has variously described the ERISA preemption clause as having "a broad scope, and an expansive sweep, and [as being] broadly worded, deliberately expansive, and conspicuous for its breadth." Id. (quotations and citations omitted).

The Supreme Court, in considering the standard for preemption enunciated in § 1144(a), has also noted that:

If [§ 1144(a)'s] "relate to" [language] were taken to extend to the furthest stretch of its indeterminacy, then for all practical purposes pre-emption would never run its course, for really, universally, relations stop nowhere. But that, of course, would be to read Congress's words of limitation as mere sham, and to read the presumption against pre-emption out of the law whenever Congress speaks to the matter with generality.

New York Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 655-57, 115 S.Ct. 1671, 1677, 131 L.Ed.2d 695 (1995) (New York Blues ). See also Dillingham, 519 U.S. at ----, 117 S.Ct. at 843 (Scalia, J., concurring) ("But applying the 'relate to' provision [of ERISA's preemption clause] according to its terms was a project doomed to failure, since, as many a curbstone philosopher has observed, everything is related to everything else."). Accordingly, notwithstanding § 1144(a)'s broad language, "[s]ome state actions may affect employee benefit plans in too tenuous, remote, or peripheral a manner to warrant a finding that the law 'relates to' the plan." Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 100 n. 21, 103 S.Ct. 2890, 2901 n. 21, 77 L.Ed.2d 490 (1983).

In applying § 1144(a), the Supreme Court has created a two-part inquiry to determine whether a state law "relates to" an employee benefit plan covered by ERISA. See Dillingham, 519 U.S. at ----, 117 S.Ct. at 837. Under this test, "[a] law 'relates to' a covered employee benefit plan for purposes of § [1144(a) ] if it (1) has a connection with or (2) reference to such a plan." Id. (quotations, citations, and alterations omitted). We address the "reference" prong of the Supreme Court's "relates to" analysis first.

A.

Where a state law "impos[es] requirements by reference to ERISA covered programs[,] ... that reference will result in preemption." Dillingham, 519 U.S. at ---- - ----, 117 S.Ct. at 837-38 (quotations, citations, and alterations omitted). A state law has such a prohibited reference to an ERISA plan if the state law "acts immediately and exclusively upon ERISA plans ... or where the existence of ERISA plans is essential to the law's operation...." Dillingham, 519 U.S. at ----, 117 S.Ct. at 838.

We have previously addressed whether the Missouri state common-law tort of negligent misrepresentation contains a "reference to ERISA." See In Home Health, 101 F.3d at 602. ¹ The In Home Health court noted that [t]o maintain a cause of action for negligent misrepresentation under Missouri law, one must show (1) that the speaker supplied information in the course of the speaker's business or because of some other pecuniary interest; (2) that, due to the speaker's failure to exercise reasonable care or competence in obtaining or communicating this information, the information was false; (3) that the speaker intentionally provided the information for the guidance of a limited group of persons in a particular business transaction; (4) that the listener justifiably relied on the information; and (5) that as a result of the listener's reliance on the statement, the listener suffered a pecuniary loss.

In Home Health, 101 F.3d at 602 n. 2 (citing Colgan v. Washington Realty Co., 879 S.W.2d 686, 689 (Mo.App.1994)). Upon considering these elements of the tort, we concluded "that the state common law on negligent misrepresentation is of general application. It does not actually or implicitly refer to ERISA plans. The state law on misrepresentation ... is of general application as it makes no reference to and functions irrespective of the existence of an ERISA plan." Id. at 605 n. 6 (quotations and citations omitted). Because "the existence of ERISA plans" is not essential to the operation of Missouri state common-law tort of negligent misrepresentation, Dillingham, 519 U.S. at ----, 117 S.Ct. at 838, and because the tort of negligent misrepresentation does not "impos[e] requirements by reference to ERISA covered programs," id. at ----, 117 S.Ct. at 837 (quotations, citations, and alterations omitted), nor "acts immediately and exclusively upon ERISA plans," id. at ----, 117 S.Ct. at 838, Wilson's tort action for negligent misrepresentation against Zoellner is not preempted by ERISA on the basis of any reference to ERISA.

B.

Because the Missouri tort of negligent misrepresentation does not contain a...