Opinion
Civil No. 03-6205 ADM/AJB
May 26, 2004
Siira B. Gunderson, Esq., Gregerson, Rosow, Johnson Nilan, Ltd., Minneapolis, MN, appeared for and on behalf of Plaintiff
Tamika R. Nordstrom, Esq., Briggs and Morgan, P.A., Minneapolis, MN, appeared for and on behalf of Defendant
MEMORANDUM OPINION AND ORDER
I. INTRODUCTION
This matter is before the undersigned United States District Judge for consideration of Plaintiff Barbara Solum's ("Plaintiff or "Solum") Motion to Remand [Docket No. 13]. Defendant ATT Corporation ("Defendant" or "ATT") argues remand is inappropriate because this Court has both federal question and diversity jurisdiction. For the reasons that follow, Plaintiff's Motion is granted.
II. BACKGROUND
Solum retired from her employment at ATT on April 8, 2002. She claims that during March 2002, management informed her she had earned $8000 in commissions and that she was eligible for and would receive pension and post-retirement benefits under ATT's ERISA-governed pension plan. She avers that she made the decision to retire in reliance upon these representations, which ATT later informed her were false. Based on these allegations, Plaintiff brought an action on October 30, 2003, in Hennepin County District Court. Her Complaint asserts five state law counts: negligent misrepresentation, promissory estoppel, breach of contract, failure to pay commissions under Minn. Stat. § 181.03, subd. 2, and failure to pay commissions under Minn. Stat. § 181.14. Compl. ¶¶ 11-30 [Docket No. 1]. She seeks lost wages and benefits, reinstatement, earned and unpaid commissions, and costs, disbursements and fees. Id. at 4-5.
ATT removed the case to this Court on November 20, 2003. It asserts that at least two of Solum's claims are preempted by the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq., and that diversity jurisdiction exists as well. Plaintiff brings the instant Motion to remand the action to state court for lack of subject matter jurisdiction.
III. DISCUSSION
On a motion to remand, the party seeking removal and opposing remand bears the burden of establishing the existence of jurisdiction, and the court is "required to resolve all doubts about federal jurisdiction in favor of remand." Wilson v. Republic Iron Steele Co., 257 U.S. 92, 97 (1921); In re Bus. Men's Assurance Co. of Am., 992 F.2d 181, 183 (8th Cir. 1993).
A. Federal Question Jurisdiction
Federal jurisdiction is determined by the plaintiff's "Well-pleaded complaint" and therefore removal is generally proper only when the complaint raises issues of federal law. Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63 (1987). Because the face of Plaintiff s Complaint does not assert a claim or right "arising under the Constitution, laws, or treaties of the Unites States," Defendant relies on the complete preemption doctrine, an exception to the well-pleaded complaint rule, to support removal of this case. 28 U.S.C. § 1331, 1441(b); Hull v. Fallon, 188 F.3d 939, 942 (8th Cir. 1999); Compl. Pursuant to this doctrine, when a plaintiff's state law claim has been entirely displaced by federal regulation, it is "necessarily federal in character" and will provide a basis for removal.Taylor, 481 U.S. at 63-64. ERISA completely preempts a state cause of action when the state claim: 1) relates to an ERISA-covered plan within the meaning of the statutory preemption section, 29 U.S.C. § 1144(a); and 2) falls within the scope of ERISA's civil enforcement provision, 29 U.S.C. § 1132(a). Id. at 64-66. A law relates to an ERISA benefit plan "if it has a connection with or reference to such a plan." Shaw v. Delta Air Lines. Inc., 463 U.S. 85, 96-97 (1983).
Defendant argues Plaintiff's negligent misrepresentation and promissory estoppel claims are directly related to ATT's ERISA-governed pension plan. Plaintiff responds that because she admits she does not qualify for pension benefits and is not challenging ATT's administration of the plan, her allegations have no connection to and do not require interpretation of the pension plan.
Unlike the cases on which ATT relies, Solum is not alleging wrongful denial of benefits or administration of the plan. See Shea v. Esensten, 107 F.3d 625, 626-27 (8th Cir. 1997); Teichner v. Cunningham Field Research Servs., No. 01-1228, 2001 WL 1640102, at *2 (D. Minn. November 29, 2001). Rather, she avers that because she relied on misrepresentations by Defendant regarding her pension eligibility and commission compensation, "she lost a quantifiable stream of income that she would now be receiving had she never left" her position at ATT.Smith v. Texas Children's Hosp., 84 F.3d 152, 155 (5th Cir. 1996). Plaintiff's stipulation that she is not entitled to benefits means her claim "does not necessarily depend upon the scope of [her] rights" under ATT's plan and that the court need not interpret the terms and conditions of the plan. Id. at 155. Nonetheless, ERISA's preemption sweeps broadly and the misrepresentation and promissory estoppel claims, Counts I and II, while not dependant on the substance of the plan, reference it as a basis for the alleged unlawful action. Compl. HI! 12, 17 ("ATT made false statements to Solum regarding the pension and health benefits she would receive upon retirement."; "ATT made a promise, clear and unambiguous in its terms, to Solum that she would receive pension and post-retirement health benefits."). Accordingly, these claims "relate to" the pension plan within the meaning of ERISA. See Shaw, 463 U.S. at 96-97; Teichner, 2001 WL 1640102, at *2. The inquiry, however, does not end here.
For complete preemption to apply, not only must a plaintiff's claim relate to the relevant ERISA plan, it must fall within the scope of ERISA's civil enforcement provisions. Taylor, 481 U.S. at 63-64. ERISA permits a cause of action "(1) by a [plan] participant or beneficiary . . . (B) to recover benefits due to him under the terms of his plan, to enforce his rights under the terms of the plan, or to clarify his rights to future benefits under the terms of the plan." 29 U.S.C. § 1132(a). Additionally, a "civil action may be brought-(3) by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which violates any provision of this subchapter or the terms of the plan, or (B) to obtain other appropriate equitable relief (i) to redress such violations or (ii) to enforce any provisions of this subchapter or the terms of the plan." Id. § 1132(a)(3).
Contrary to her argument that she may not bring suit under the civil action provision because she was not a vested participant in ATT's ERISA plan, Plaintiff was a plan "participant" even though she had not accrued sufficient years of service for vested rights. See Nordstrom Aff. Ex. 1 at 1-2, 13-14 (ATT Pension Plan Summary Plan Description).
Here, Solum does not request benefits under ATT's pension plan and concedes she is and was ineligible. The Complaint however, does explicitly seek payment of "benefits," which she contends is merely a reference to vacation and sick benefits she had been receiving as part of her regular employment.
Resolving all doubts in favor of remand, Solum's claims are not displaced by ERISA § 1132(a). Although a somewhat ambiguous pleading, the Complaint does not allege rights under the pension plan, and concedes that Plaintiff learned from ATT that she was not eligible. See Compl. ¶¶ 6, 10, 12 (alleging ATT represented to Plaintiff she was eligible for benefits, thereafter told her the statements were false). The requested benefits are tied to a demand for lost wages and thus may, as Plaintiff argues, be construed as other, non-ERISA benefits Plaintiff had been receiving and lost when she retired from her position. Because the face of the Complaint does not claim entitlement to pension benefits and does not aver that Defendant violated any term of ERISA or the ATT pension plan, Plaintiff does not have a remedy under this ERISA provision, and the state claims do not provide grounds for federal question removal. See Smith, 84 F.3d at 155 (stating that plaintiff's fraudulent inducement claim, if preserved, would not be preempted because she was not claiming rights under an ERISA plan, but compensation for the loss of benefits she relinquished in reliance upon defendant's representations of future benefits).
B. Diversity Jurisdiction
ATT argues jurisdiction is also proper on diversity grounds. See 28 U.S.C. § 1332. Solum is a resident of Minnesota and ATT is a New York corporation. Therefore, if the amount in controversy exceeds $75,000, diversity jurisdiction is established. Id.
The determination of the amount in controversy is limited to evidence available at the time the notice of removal is filed. Chase v. Shop `N Save Warehouse Foods, Inc., 110 F.3d 424, 428 (7th Cir. 1997). ATT bears the burden of producing competent proof, to a reasonable probability, that the jurisdictional minimum is met. Id. ATT bases its argument on figures provided by Plaintiff in her discovery disclosures, as well as Plaintiff's refusal to stipulate that she will not seek damages in excess of $75,000. However, the disclosure evidence was not present at the time of removal and therefore may not properly be considered. Id. Further, while a plaintiff's failure to stipulate to an amount below the jurisdictional threshold may be a factor in the jurisdiction determination, it does not shift the defendant's initial burden to produce proof of the requisite amount. See id.; Hogg v. Rust Indus. Cleaning Servs., Inc., 896 F. Supp. 655, 657 (N.D. Tex. 1995). Accordingly, because ATT has presented no temporally appropriate evidence that Plaintiff's claims are worth more than $75,000, it has not established diversity jurisdiction.
IV. CONCLUSION
Based upon the foregoing, and all the files, records, and proceedings herein, IT IS HEREBY ORDERED that Plaintiff's Motion to Remand [Docket No. 13] is GRANTED. LET JUDGMENT BE ENTERED ACCORDINGLY.