Ledet v. Bd. of Trs.

1

MARY LEDET, Plaintiff v. BOARD OF TRUSTEES OF TRANSIT MANAGEMENT OF SOUTHEAST LOUISIANA, INC. RETIREMENT INCOME PLAN, Defendant

Civil Action No. 22-3697

United States District Court, E.D. Louisiana

December 12, 2022

SECTION “E” (1)

ORDER AND REASONS

SUSIE MORGAN, UNITED STATES DISTRICT JUDGE

Before the Court is a motion to remand filed by Plaintiff Mary Ledet (“Plaintiff”).^[1]Defendant Board of Trustees of Transit Management of Southeast Louisiana, Inc. Retirement Income Plan (“Defendant”) filed an opposition to the motion.^[2]

BACKGROUND

On May 13, 2022, Plaintiff filed suit against Defendant in the Civil District Court for the Parish of Orleans seeking unpaid pension payments based on the employment of her late husband.^[3] In her petition for damages, Plaintiff brings the following claims under Louisiana law: (1) breach of contract; (2) stipulation pour autrui; (3) detrimental reliance and/or promissory estoppel; (4) breach of fiduciary duty; (5) negligence; and (6) conversion.^[4] Plaintiff also brings the following claims under the Employee Retirement Income Security Act (“ERISA”): (1) a claim for unpaid benefits pursuant to ERISA § 502(a)(1)(b); and (2) breach of fiduciary duty under ERISA § 502(a)(3), seeking all equitable remedies, including but not limited to surcharge, injunction, and accounting.^[5]

Plaintiff served Defendant with the petition for damages on June 23 2022.^[6] On October 6, 2022, Defendant filed a notice of removal in this Court.^[7] On October 24, 2022 Plaintiff filed the instant motion to remand on the basis that Defendant's notice of removal was untimely.^[8] On November 1, 2022, Defendant timely filed an opposition.^[9]

LEGAL STANDARD

In ruling on a motion to remand, the court “must presume that a suit lies outside th[e court's] limited jurisdiction, and the burden of establishing federal jurisdiction rests on the party seeking the federal forum.”^[10] “This extends not only to demonstrating a jurisdictional basis for removal, but also necessary compliance with the requirements of the removal statute.”^[11] “District courts within the Fifth Circuit have closely adhered to the requirements for removal under § 1446.”^[12] “The removal statute ties the propriety of removal to the original jurisdiction of the federal district courts.”^[13] “Because removal raises significant federalism concerns, the removal statutes are strictly and narrowly construed, with any doubt resolved against removal and in favor of remand.”^[14] “District courts have no power to overlook procedural errors relating to the notice of removal; instead, a district court must remand a case which was removed pursuant to a procedurally defective notice.”^[15]

28 U.S.C. § 1446(b)(1) requires

The notice of removal of a civil action or proceeding shall be filed within 30 days after the receipt by the defendant, through service or otherwise, of a copy of the initial pleading setting forth the claim for relief upon which such action or proceeding is based, or within 30 days after the service of summons upon the defendant if such initial pleading has then been filed in court and is not required to be served on the defendant, whichever period is shorter.^[16]

LAW AND ANALYSIS

Plaintiff seeks remand because Defendant's notice of removal was untimely.^[17]Defendant acknowledges its notice of removal was untimely.^[18] First, however, Defendant argues it did not timely file the notice of removal because it detrimentally relied on an agreement with Plaintiff in which Plaintiff agreed to give Defendant an extension of “a reasonable amount of time to review the suit and file responsive pleadings.”^[19] Second, Defendant argues that regardless of the untimely removal, federal courts have exclusive jurisdiction over ERISA claims and that remand would be improper.^[20] For the foregoing reasons, the Court denies the motion.

At the outset, the Court will identify whether it has exclusive or concurrent jurisdiction over Plaintiff's ERISA claims under 29 U.S.C. 1332(e)(1).^[21] If the Court has exclusive jurisdiction, remand on the basis of untimeliness is improper.^[22] If the Court has concurrent jurisdiction with state courts, the Court may consider the issue of timeliness and decide whether remand is proper.^[23]

I. The Court Has Exclusive Jurisdiction Over At Least One of Plaintiff's ERISA Claims.

This Court has exclusive jurisdiction over ERISA enforcement claims detailed in 29 U.S.C. § 1332(e)(1).^[24] Section 1332(e)(1) provides in full:

Except for actions under subsection (a)(1)(B) of this Section, the district courts of the United States shall have exclusive jurisdiction of civil actions under this subchapter brought by the Secretary or by a participant, beneficiary, fiduciary, or any person referred to in section 1021(f)(1) of this title. State courts of competent jurisdiction and district courts of the United States shall have concurrent jurisdiction of actions under paragraphs (1)(B) and (7) of subsection (a) of this section.^[25]

Put another way, “the federal courts have exclusive jurisdiction over all Section 502 claims except those arising under (a)(1)(b), over which state courts have concurrent jurisdiction.”^[26] Subsection (a)(3), over which the Court has exclusive jurisdiction, states a civil action may be brought by a beneficiary “(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.”^[27] “[T]he text of ERISA makes it clear that the relief sought must be ‘appropriate equitable relief,' not legal relief.”^[28] “[T]he Supreme Court has repeatedly defined ‘appropriate equitable relief' as ‘those categories of relief that were typically available in equity.'”^[29] Accordingly, the question for the Court is whether Plaintiff has stated such a claim for “appropriate equitable relief” over which this Court has exclusive jurisdiction under Section 502(a)(3).^[30]

The Fifth Circuit has held that surcharge,^[31] injunction,^[32] and an accounting^[33] are forms of equitable relief available to plaintiffs for a breach of fiduciary duty claim under ERISA. In her state court petition, Plaintiff's eighth count states:

Plaintiff makes a claim for breach of fiduciary duty under ERISA § 502(a)(3) for failure to keep and maintain adequate records, for failure to pay sums due to the plaintiff and paid to defendant for her benefit, for failure to treat plaintiff as a beneficiary, and any other acts or omissions which may [be] revealed by discovery in this matter. Plaintiff seeks all available equitable remedies, including but not limited to surcharge, injunction, and accounting.^[34]

Plaintiff has stated claims for forms of “appropriate equitable relief”-namely surcharge, injunction, and an accounting-under Section 502(a)(3), and as a result, this Court has exclusive jurisdiction over Plaintiff's claims arising under this section.

Having found the Court has exclusive jurisdiction over Plaintiff's Section 502(a)(3) claim, the Court need not reach the issue of timeliness of removal as to this claim. The Court acknowledges Defendant's removal to federal court was untimely. However, where a federal court has exclusive jurisdiction over a plaintiff's claim, as it does here, the question of timeliness is irrelevant because the state court lacks jurisdiction entirely.^[35]The Court refrains from further discussing the issue of timeliness, as remand to state court would be fruitless.^[36] Accordingly, the Court now considers whether it has jurisdiction over Plaintiff's remaining claims.

II. The Court Exercises Concurrent and Supplemental Jurisdiction Over Plaintiff's Remaining Claims.

The Court has concurrent and supplemental jurisdiction over Plaintiff's additional claims. First, federal courts have concurrent jurisdiction with state courts over ERISA claims arising under Section 502(a)(1)(b).^[37] The Court exercises its concurrent jurisdiction over Plaintiff's ERISA claim for unpaid benefits-count seven of Plaintiff's state court petition.^[38]

Second, the Court exercises supplemental jurisdiction over Plaintiff's state law claims-counts one through six. It is well-settled that “once the court has proper removal jurisdiction over a federal claim, it may exercise supplemental jurisdiction over state law claims.”^[39] Supplemental jurisdiction is governed by 28 U.S.C. § 1367(a), which reads in pertinent part:

[I]n any civil action of which the district courts have original jurisdiction, the district courts shall have supplemental jurisdiction of all the other claims that are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy under Article III of the United States Constitution.^[40]

If a court has supplemental jurisdiction over the related claims the court must then determine whether a discretionary remand is warranted.^[41] Under 28 U.S.C. § 1367(c), a district court may, in its discretion, remand related claims if (1) “the claim raises a novel or complex issue of State law;” (2) “the claim substantially predominates over the claim or claims over which the district court has original jurisdiction;” (3) “the district court has dismissed all claims over which it has original jurisdiction;” or (4) “in exceptional circumstances, there are compelling reasons for declining jurisdiction.”^[42] In addition, the Court should consider whether the common law factors, including “the interests of judicial economy, fairness, convenience, and comity,” favor remand.^[43] None of the statutory nor common law factors are dispositive; instead, the Court must balance...