Gautier-Figueroa v. Bristol-Myers Squibb Puerto Rico, Inc.

MARIA B. GAUTIER-FIGUEROA Plaintiff,

v.BRISTOL-MYERS SQUIBB PUERTO RICO, INC., et al. Defendants.

Civil No. 11-1155 (SEC)

UNITED STATES DISTRICT COURT FOR THE DISTRICT OF PUERTO RICO

Dated: February 29, 2012

OPINION AND ORDER

Before the Court is plaintiff Maria Gautier-Figueroa's ("Gautier") motion to remand to state court (Docket # 72). Because the Employee Retirement Income Security Act of 1974 ("ERISA"), 88 Stat. 829, as amended, 29 U.S.C. § 1001 et seq. is inapplicable, and there being no other federal question here, Puerto Rico contractual law controls. Gautier's motion, therefore, is GRANTED. Consequently, to the extent that the Opinion and Order of June 20, 2011 in Gautier-Figueroa v. Bristol-Myers Squibb Puerto Rico, Inc., 792 F.Supp.2d 240 (D.P.R. 2011) is inconsistent with the conclusions set forth below, it is hereby SET ASIDE.

Factual and Procedural Background

What should have been a typical employee-against-employer state suit for breach of contract has, unfortunately, taken an unpredictable turn into an arcane area of the ERISA legislation. This case arises following Gautier's filing of a complaint in state court against her former employer, Bristol-Myers Squibb Puerto Rico, Inc. ("Bristol" or the "Company"), alleging, among other related state-law claims, that Bristol had breached the "BMS Puerto Rico Severance Pay and Release Agreement" (the "Severance Agreement") by virtue of which she waived all her claims against Bristol arising from her involuntary termination. Docket # 8-1, pp.7-8.¹ A comprehensive recount of Gautier's factual and underlying allegations provides the context and background necessary to set the stage for the analysis.

The 41 year-old Gautier began working for Bristol in 1998, and eventually reached the position of Director Parenteral O.S.D. & Packaging at Bristol's manufacturing plant in Manati, Puerto Rico. Docket # 59, ¶¶ 8-10. While she worked there, Gautier did well: her total salary with benefits totaled $150,566 per year. Id., ¶ 11.

But that all changed on May 5, 2010, when Bristol terminated her for no particular reason. Id., ¶ 11. At Gautier's termination meeting, Rosa Sanabria-Nazario, Bristol's Human Resources Director, provided her with a notice of termination (the "Notice of Termination"), a termination package comprised of several attachments, including the Severance Agreement she had to sign and deliver by May 19, 2010, the effective date of her termination. Id., ¶ 13.² The Company drafted and prepared such documents in their entirety, and according to the complaint, Sanabria told Gautier that in order to receive her severance benefits, she had to sign these documents, which were presented in terms of "take it or leave it." Id., ¶ 15. In pertinent part, the Notice of Termination provided:

Your severance pay calculation appears on this attachment. Severance pay will be provided to you in accordance with the terms and provisions of the Bristol-Myers Squibb Company Puerto Rico, Inc. Severance Plan and Summary Plan Description (the Severance Plan). If you comply with the requirements described below, severance benefits will be paid to you at regular payroll intervals until the full benefit is paid. If youobtain new employment, however, the balance of any outstanding severance payments that may be due will be paid to you in a lump sum.

Docket # 6-1, p. 1.

Paramount to the Notice of Termination was a general release attachment (the "General Release") Gautier had to sign in the same prescribed period of time, or else she "[would] not be eligible for Basic Severance or Supplemental Severance." Id.³ In fact, per the Notice of Termination, failure to sign the General Release would entail that she would receive no post-termination benefits. Id. The General Release listed a plethora of employment-related statutes that Gautier relinquished "[i]n consideration of the execution of and [Gautier's] compliance with the [General Release] . . . ." Id., p. 7-8. One of the laws Gautier "waived" was ERISA; in fact, this is the only instance where the acronym "ERISA" appears in the Notice of Termination and its attachments. Further, the General Release provided that it would "[b]e governed by the laws of the Commonwealth of Puerto Rico . . . ." Id., p. 9.

The severance worksheet attachment (the "Severance Worksheet") in turn provided for the simple tabulation of basic and supplemental severance, see id., p. 5, both of which were calculated by a mathematical formula. For instance, "[b]asic pay [was] [Gautier's] weekly base rate of pay at [her] termination date, including salary reductions . . ., and excluding any overtime pay, any individual sales bonuses or other additional incentive payments." Id. Gautier's Supplemental Severance, meanwhile, was calculated based on three months of salary plus two weeks pay for each full year of service. In short, her severance pay yielded $189,838 in supplemental severance and $4,632 as basic severance, for a total of $194,271. Per the Severance Pay Worksheet, Bristol's obligation to make severance payments ran from May 19, 2010 to November 9, 2010. Id.

Both parties signed the Severance Agreement in early May 2010 and thereafter Bristol started making the corresponding severance payments. But on July 14, 2010, the Company, through Beatriz B. Sanabria, sent a letter to Gautier where it "temporarily" suspended her severance payments, citing a "system error" that miscalculated her supplemental severance. Docket # 6-1, p. 11.⁴ The Company stated that the "correct" amount was $68,102: over a sixty percent reduction from the original $194,271 it had agreed to. Id. Bristol also provided Gautier with a new "severance package," (the "New Agreement"), which incorporated the referenced reduction. This time, however, Bristol gave Gautier forty five days to consider the New Agreement. And, as was the case with the Severance Agreement, failure to sign and timely return the New Agreement would entail that Bristol would no longer "[m]ake any further severance payments." Id.

According to the complaint, in late August 2010, the Company froze its severance payments, having paid then $88,936 of the $194,271 it had bound itself to pay. Docket # 59, ¶¶ 62-64. Then, on August 23, 2010 Gautier, through counsel, sent a letter to Sanabria rejecting the New Agreement and demanding compliance with the Severance Agreement contract signed in May 2010. Docket # 6-1, p. 25.⁵

A new player emerged on September 7, 2010, when the heretofore nonexistent Plan Administrator of the Bristol-Myers Squibb Puerto Rico, Inc. Severance Plan (the "Severance Plan"), through counsel, replied to Gautier's letter rejecting the New Agreement. Docket # 24-1, p. 1. Enter ERISA: the Plan Administrator stated that Gautier's letter "[h]a[d] been deemed by [it] as a first-level appeal under the [Severance] Plan, and [would] be handled as such." Id. Noting that Gautier's claims were controlled by ERISA, the Administrator gave Gautier until November 24, 2010 to submit additional comments, arguments or evidence sustaining her position. Id.

An exchange of correspondence ensued between the Administrator and Gautier's counsel. Gautier reiterated that her claims were directed at Bristol for the alleged contractual breach of the Severance Agreement, clarifying in turn that such cause of action had no relation to ERISA, Docket # 24-2, while the Plan Administrator insisted that ERISA controlled the parties' dispute. Docket # 24-3. Things unraveled and Gautier filed suit in state court on December 30, 2010, seeking damages for Bristol's alleged noncompliance with the payments set forth in the Severance Agreement, i.e., the amount agreed to in May 2010. See generally Docket # 1-1.

Then, on February 11, 2011, Bristol filed a timely Notice of Removal (Docket # 1) before this court, arguing that because Gautier sought to recover benefits pursuant to an ERISA plan, removal was proper. A month later, Gautier filed a motion to remand to state court (Docket # 12), maintaining that (1) the complaint on its face made no reference to ERISA, id., ¶¶ 22-35; and (2) her Severance Agreement did not constitute an ERISA plan, id., at ¶¶ 46-67. On June20, 2011, the Court entertained these issues, framing the controversy as follows: (1) is the Severance Agreement between Bristol and Gautier part of an employee benefit plan?; (2) if so, does the "complete preemption" doctrine apply? Gautier-Figueroa, 792 F.Supp.2d at 242.

In answering the first question in the affirmative, this court stated: "the [Severance] Plan is the kind of ongoing, centrally administered, bureaucratic behemoth whose beneficiaries Congress intended to innoculate from multifarious state legislation pursuant to its Commerce Clause powers." Id. at 244 (citations omitted). Because Gautier sought to recover benefits due to her under the Severance Plan, the Court reasoned, her cause of action "[f]ell directly under § 502(a)(1)(B) of ERISA." Id. (citation omitted). Ultimately, this court held that complete preemption applied, and consequently, removal had been proper. Id. (citations omitted).

Following an active motion practice, the Court entered an Order on November 4, 2011, asking Bristol to show cause as to why it should not reconsider its June 20, 2011 Opinion and Order.⁶ In pertinent part, the Order stated:

Absent from that opinion . . . were important factors that could change the outcome of this case, potentially depriving this Court's jurisdiction. For example, whether a "one-person" contract such as the one present here, constitutes an ERISA plan; the issue of whether the Gautier's severance "plan" created and imposed upon Bristol an administrative burden substantial enough to invoke ERISA status was likewise sidelined. (citing, inter alia, D'Oliviera v. Rare Hospitality Intern., Inc., 150 F.Supp.2d 346, 353 (D.R.I. 2001). . . .

* * *

Furthermore, "[f]rom a reasonable employee's point-of-view, the plan might not appear to be an 'expressed intention by the

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