Opinion
No. C 01-3396 MMC
December 18, 2001
ORDER GRANTING PLAINTIFF'S MOTION TO REMAND; VACATING HEARING
Before the Court is plaintiff Genentech, Inc.'s ("Genentech") motion to remand the instant action pursuant to 28 U.S.C. § 1447 (c). Opposition has been filed by defendant Aetna Life Insurance Company ("Aetna"), in which defendant Saylor Hill Company ("Saylor") has joined, and by defendants EBPLife Insurance Company, General American Life Insurance Company, Genam Benefits Insurance Company, Great-West Life Annuity Insurance Company, and Insurance Company of North America (collectively, "the EBPLife defendants"). Genentech has filed a reply. Having reviewed the papers filed in support of and in opposition to the motion, the Court deems the motion appropriate for decision on the papers, VACATES the hearing scheduled for December 21, 2001, and rules as follows.
According to the complaint, Genentech provides a self-funded employee medical benefits plan to its employees and obtained from the EBPLife defendants excess loss insurance. (See Compl. at ¶¶ 12, 15.) Genentech alleges that the EBPLife defendants breached their obligations under an excess insurance policy by which they were required to reimburse Genentech for payments it made to plan participants in excess of the $125,000 deductible per individual participant. (See id. at ¶¶ J 15, 17, 18, 20.) Genentech also alleges that "to the extent the EBPLife defendants did not receive adequate claim information,' Aetna, which contracted with Genentech to provide administrative services to the plan, and Saylor, an insurance broker which contracted to provide, inter alia reimbursement information to the EBPLife defendants, are liable to Genentech. (See Z. at ¶¶ 21, 28, 44.) Based on these allegations, Genentech pleads claims against all defendants for breach of contract and declaratory relief.
A state law claim is removable to federal district court if "the state law claim "relates to' an ERISA plan within the meaning of [29 U.S.C.] § 1144(a) and falls within the scope of ERISA's civil enforcement found in § 1132(a)." See Toumaiian v. Frailey, 135 F.3d 648, 654 (9th Cir. 1998) (emphasis in original). Here, defendants contend that Genentech's claim against Aetna is removable.
Defendants do not assert that Genentech's claims against the EBPLife defendants or Saylor are removable.
In Geweke Ford v. St. Joseph's Omni Preferred Care Inc., 130 F.3d 1355, 1358 (9th Cir. 1997), an employer that sponsored a self-funded employee benefit plan subject to ERISA brought suit against a party providing administrative services to the plan, alleging the defendant had failed to properly file claims with the employer's excess loss insurer. The Ninth Circuit held that the employer's state claims for breach of contract and declaratory relief were not removable. See id. ("[T]he contractual relationships of the parties are not connected to ERISA's regulatory scheme, and thus, ERISA did not completely preempt the state law claims.")
Defendants argue that Geweke is distinguishable. First, observing that the EBPLife policies provide that the EBPLife defendants may deny coverage if Aetna, on behalf of Genentech, improperly paid benefits to plan participants, (see Compl., Ex. 1, Art I at § 6; Ex. 2. at P-9 at § 4.), defendants contend that the complaint must be construed as including an allegation that Aetna improperly paid benefits under the plan. Defendants go on to conclude that the complaint is removable because a claim based on such improper payment falls within the scope of either 29 U.S.C. § 1109 (providing plan fiduciary who breaches duties imposed by ERISA "shall be personally liable to make good to such plan any losses") or § 1132(a)(3)) (providing that plan fiduciary may seek equitable relief to redress violations of ERISA). See, e.g., IT Corp. v. General American Life Ins. Co., 107 F.3d 1415, 1420 (9th Cir. 1997) (holding plan sponsor could bring § 1109(a) claim against plan administrator to recover payments plan improperly paid to plan participant). Defendants' argument is dependent on the presence in the complaint of either an express or implied allegation that Aetna breached its fiduciary duty to Genentech by paying non-eligible claims. The complaint, however, includes no such allegation. Indeed, the complaint expressly alleges that the plan participants who received benefits were entitled to such benefits under the terms of the plan. (See Compl. at ¶ 22 ("All Genentech employees and their dependents have received all benefits to which they were entitled under the benefits plan.")) Because the complaint does not include a claim that Aetna improperly paid benefits to plan participants, or that Aetna otherwise acted contrary to the terms of the ERISA plan, Genentech's claims against Aetna are not removable. See Union Health Care, Inc. v. John Alden Life Ins. Co., 908 F. Supp. 429, 435-36 (S.D. Miss. 1995) (holding complaint by ERISA plan sponsor alleging claims administrator failed to notify excess loss carrier of plan sponsor's excess claims was not removable because plan sponsor was not alleging claims administrator breached any duty owned to the plan or plan participants). Accordingly, the Court lacks subject matter jurisdiction over the complaint.
CONCLUSION
For the reasons expressed above, Genentech's motion to remand is hereby GRANTED, and the action is hereby REMANDED to the Superior Court of California for the County of San Mateo pursuant to 28 U.S.C. § 1447 (c).
The Clerk shall close the file.
IT IS SO ORDERED.