Gonzales v. Metro. Life Ins. Co.

RAMOS GONZALES v. METROPOLITAN LIFE INSURANCE COMPANY

CIVIL ACTION NO. 20-1022 SECTION "R" (4)

UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA

August 13, 2020

ORDER AND REASONS

Before the Court is defendant Metropolitan Life Insurance Company's ("MetLife") unopposed motion to dismiss.¹ Because plaintiff's claim is both completely preempted under the Employment Retirement Income Security Act of 1974 ("ERISA"), § 502, 29 U.S.C. § 1132, and conflict preempted under ERISA § 514, 29 U.S.C. § 1144, the Court grants the motion.

I. BACKGROUND

This case arises from an insurance coverage dispute. On February 4, 2018, while attending a parade, plaintiff Ramos Gonzales suffered a stroke.² At the time, he had an insurance policy with defendant MetLife.³ Gonzalesmade a claim under the policy, but MetLife allegedly denied the claim for failure to show adequate "proof of loss."⁴

Gonzales sued MetLife in state court pursuant to La. R.S. § 22:1821.⁵ MetLife removed this matter to federal court on March 26, 2020.⁶ MetLife initially filed its motion to dismiss plaintiff's claim on April 2, 2020, with a submission date of May 6, 2020.⁷ Before responding to the motion to dismiss, plaintiff terminated the services of his counsel on May 29, 2020,⁸ and the Court allowed plaintiff's counsel to withdraw.⁹ On June 5, 2020, the Court ordered plaintiff to submit, by June 19, 2020, a written statement regarding future representation and the steps he was taking to secure new counsel. The Court continued the submission date on the motion to dismiss to July 15, 2020.¹⁰ Plaintiff did not timely respond to the Court's order, and in an out of time response, indicated an intention or desire to search for counsel.¹¹ On June 23, 2020, the Court issued an order notifying plaintiff that he must prosecute the case with or without counsel and that failure toprosecute the case may result in the imposition of appropriate sanctions, including dismissal.¹² Plaintiff did not respond to the motion to dismiss either in person or through counsel. The Court now considers the motion to dismiss.¹³

II. LEGAL STANDARD

A. Rule 12(b)(6)

When considering a motion to dismiss under Rule 12(b)(6), the Court accepts all well-pleaded facts as true and views the facts in the light most favorable to the plaintiff. See Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996). The Court must resolve doubts as to the sufficiency of the claim in the plaintiff's favor. Vulcan Materials Co. v. City of Tehuacana, 238 F.3d 382, 387 (5th Cir. 2001).

But to survive a Rule 12(b)(6) motion, a party must plead "sufficient factual matter, accepted as true, to 'state a claim to relief that is plausible on its face.'" Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). Courts must dismiss the claim if there are insufficient factual allegations to raise the right to relief above the speculative level, Twombly, 550 U.S. at 555, or if it is apparent from the faceof the complaint that there is an insuperable bar to relief, Jones v. Bock, 549 U.S. 199, 215 (2007). The Court is not bound to accept as true legal conclusions couched as factual allegations. Iqbal, 556 U.S. at 679.

On a Rule 12(b)(6) motion, the Court must limit its review to the contents of the pleadings, including attachments. Brand Coupon Network, L.L.C. v. Catalina Mktg. Corp., 748 F.3d 631, 635 (5th Cir. 2014). The Court may also consider documents attached to a motion to dismiss or an opposition to that motion when the documents are referred to in the pleadings and are central to a plaintiff's claims. Id.

B. ERISA Preemption

ERISA may preempt state law claims in one of two ways. See Gomez v. Ericsson, Inc. 828 F.3d 376 (5th Cir. 2016) (citing Haynes v. Prudential Health Care, 313 F.3d 330, 334 (5th Cir. 2002); Giles v. NYLCare Health Plans, Inc., 172 F.3d 332, 336 (5th Cir. 1999)). First, the federal law may "occupy a particular field, resulting in complete preemption under [ERISA] § 502(a), 29 U.S.C. § 1132(a)." Giles, 172 F.3d at 336 (citing Met. Life Ins. v. Taylor, 481 U.S. 58 (1987); McClelland v. Gronwaldt, 155 F.3d 507 (5th Cir. 1998), overruled in part on other grounds by Arana v. Ochsner Health Plan, 338 F.3d 433, 440 n.11; see also Arana, 338 F.3d at 437. "[C]omplete preemption exists when a remedy falls within the scope of or is in directconflict with ERISA § 502(a), and therefore is within the jurisdiction of federal court." McGowin v. ManPower Int'l, Inc., 363 F.3d 556, 559 (5th Cir. 2004).

The second form of ERISA preemption is "ordinary" or "conflict" preemption. It exists when ERISA provides an affirmative defense to state law claims and involves ERISA § 514(a), 29 U.S.C. § 1144(a). Giles, 172 F.3d at 337. Section 514(a) provides that ERISA "shall supersede any and all State laws insofar as they may now or hereafter relate to any employer benefit plan." 29 U.S.C. § 1144(a) (emphasis added). Unlike complete preemption, the mere presence of conflict preemption does not raise a federal question. Instead of "transmogrifying a state cause of action into a federal one—as occurs with complete preemption—conflict preemption serves as a defense to a state action." Giles, 172 F.3d at 337 (citing Soley v. First Nat'l Bank of Commerce, 923 F.2d 406, 407-08 (5th Cir. 1991); Rice v. Panchal, 65 F.3d 637, 639-40 (7th Cir. 1995)). When a state law claim is conflict preempted by ERISA, the appropriate result is dismissal. See Ellis v. Liberty Life Assur. Co. of Bos., 394 F.3d 262, 266 (5th Cir. 2004) (affirming dismissal of claim when "the district court dismissed Ellis's state-law claims . . . holding that they are preempted by ERISA").

The party asserting ERISA preemption has the burden to demonstrate that ERISA preempts the claims at issue. See Bankston v. Unam Life Ins., No. 07-5507, 2009 WL 57104, at *2 (E.D. La. 2009); Murphy v. Inexco Oil Co., 611 F.2d 570, 573 (5th Cir. 1980).

III. DISCUSSION

A. Whether the Policy Is an ERISA Plan

To determine whether plaintiff's claim is preempted—either under the doctrine of complete preemption or conflict preemption—the Court must first determine whether MetLife's insurance policy is an ERISA "plan." 29 U.S.C. § 1002(3). A "plan" or "employee benefit plan" is "an employee welfare benefit plan." 29 U.S.C. § 1002(3). An "employee welfare benefit plan" is described as follows:

any plan, fund, or program which was . . . established or maintained by an employer . . . to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise . . . benefits in the event of sickness, accident, disability, death or unemployment . . . .

Id. at § 1002(1). The Fifth Circuit uses a three-part test to decide whether an insurance policy is a plan under ERISA. Shearer v. Sw. Serv. Life Ins., 516 F.3d 276, 279 (5th Cir. 2008). To qualify, "the arrangement must be (1) a plan, (2) not excluded from ERISA coverage by the safe-harbor provisions established by the Department of Labor,and (3) established or maintained by the employer with the intent to benefit employees." Id.

First, the MetLife insurance policy¹⁴ is a "plan" within the meaning of the statute. To make this determination, courts ask whether, when looking at the policy, "a reasonable person could ascertain the intended benefits, beneficiaries, source of financing, and procedures for receiving benefits." Meredith v. Time Ins., 980 F.2d 352, 355 (5th Cir. 1993). This information is apparent from the face of the certificate of insurance on the MetLife policy. The certificate of insurance lists various benefits including "critical illness benefit for . . . stroke."¹⁵ It also describes beneficiaries as "eligible classes."¹⁶ The certificate names Panasonic as the "policyholder" and indicates the insurance is financed through the payments of premiums by the policyholder.¹⁷ Finally, the certificate contains information on proceduresfor "filing a claim."¹⁸ Second, the policy is not excluded from ERISA coverage by the Department of Labor's safe-harbor provisions. The Department's safe-harbor provisions apply to a group insurance program in which "[n]o contributions are made by an employer." 29 C.F.R. § 2510.3-1(j)(1). The certificate of insurance indicates that plaintiff's employer, Panasonic, paid premiums for the group policy.¹⁹ Third, it is clear from the face of the certificate of insurance that Panasonic, the policyholder, acquired the policy with the intent to benefit its employees in the event of critical illness.²⁰ See Mem'l Hosp. Sys. v. Northbrook Life Ins. Co., 904 F.2d 236, 241 (5th Cir. 1990) (employer demonstrated an intent to benefit employees when it purchased and maintained a group insurance policy like the one at issue here).

B. Preemption

1. Complete Preemption

"[A]ny state-law cause of action that duplicates, supplements, or supplants the ERISA civil enforcement remedy conflicts with the clear congressional intent to make the ERISA remedy exclusive and is therefore pre-empted." Aetna Health Inc. v. Davila, 542 U.S. 200, 209 (2004). In other words, ERISA's civil enforcement provision completely preempts any state cause of action that falls within its scope. See Arana 338 F.3d at 440 (5th Cir. 2003) (quoting Taylor, 481 U.S. at 66) ("Put simply, there is complete preemption jurisdiction over a claim that seeks relief 'within the scope of the civil enforcement provisions of § 502(a).'").

Under Davila, 542 U.S. at 210, a cause of action "falls within the scope" of the ERISA civil enforcement provision if (1) the plaintiff could have brought the claim under ERISA § 502(a)(1)(B), and (2) defendant's actions do not implicate any other independent legal duty. Here, plaintiff could have brought his claim for unpaid benefits under ERISA § 502(a)(1)(B). A claim under § 502(a)(1)(B) "is relatively straightforward." Id. When "a participant or beneficiary believes...