Schicker v. Klenda

442 F.Supp.3d 1166

Richard SCHICKER, Plaintiff,

v.Cynthia KLENDA, Defendant.

8:20-CV-02

United States District Court, D. Nebraska.

Signed March 4, 2020

Richard J. Schicker, Schicker Law Firm, Omaha, NE, for Plaintiff.

Steven D. Davidson, Baird, Holm Law Firm, Omaha, NE, for Defendant.

MEMORANDUM AND ORDER

Brian C. Buescher, United States District Judge

This case comes before the Court on Defendant's Motion to Dismiss under Fed. R. Civ. P. 12(b)(6). Filing 6. The Court finds that Plaintiff has failed to state a claim upon which relief can be granted because his tortious-interference claim is preempted by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001 – 1461, and because there is no private right of action for his claims under the Nebraska Unfair Insurance Trade Practices Act, Neb. Rev. Stat. §§ 44-1521 – 35 (Reissue 2010). Accordingly, the Court grants Defendant's Motion to Dismiss.

I. BACKGROUND¹

This case arises out of the payment of benefits under a life-insurance contract administered by defendant Cynthia Klenda's employer, Lincoln Financial Group. Filing 1-2 at 3. Plaintiff, Richard Schicker, is a Nebraska attorney. Filing 1-2 at 2. In September 2017, an individual named Brandi Cady retained Schicker to represent her in seeking life insurance benefits from Lincoln Financial Group following the death of her spouse. Filing 1-2 at 2. At the time Cady hired Schicker, Lincoln Financial Group was refusing to pay the benefits she sought. Filing 1-2 at 2. Under Cady and Schicker's contract, Schicker was to receive 40% of the amount Cady recovered from Lincoln Financial Group. Filing 1-2 at 2.

Shortly after being retained by Cady, Schicker attempted to contact Lincoln Financial Group employee Kara Vincent to notify her of his representation of Cady. Fling 1-2 at 2. Vincent returned Schicker's phone call four days later and offered to settle Cady's claim for $130,000. Filing 1-2 at 2-3. Schicker immediately communicated the offer to Cady. Filing 1-2 at 3. Schicker told Vincent that he felt there was no legally valid reason not to pay the full policy amount of $200,000 and that he would seek to have Lincoln Financial Group pay his attorney fees for having to initiate a claim. Filing 1-2 at 3.

Two days later, Klenda contacted Cady directly. Filing 1-2 at 3. During this phone call, Klenda agreed to pay Cady the full policy limits, and Cady accepted. Filing 1-2 at 4. Schicker alleges this phone call "was outside the scope of [Klenda's] employment with Lincoln Financial Group as violating the law ... and industry codes of conduct is not within any employee's scope of employment." Filing 1-2 at 2. In a follow-up email to Cady, Klenda stated, "[S]ince we are working together to get this claim completed ... you do not need an attorney to work with us to get this claim paid." Filing 1-2 at 4 (emphasis removed). Klenda also emailed Cady a beneficiary statement so that Cady could direct how she would be paid. Filing 1-2 at 4.

Cady informed Schicker of her settlement with Lincoln Financial Group and provided him with copies of Klenda's emails commemorating the agreement. Filing 1-2 at 4. Schicker gave Lincoln Financial Group written notice that he sought to impose an attorney's lien on the policy proceeds, but Lincoln Financial Group paid the entire policy directly to Cady. Filing 1-2 at 4. Schicker alleges Klenda's "[p]aying of a claim when attorneys lien existed is outside the scope of [her] employment and in violation of Nebraska law." Filing 1-2 at 4.

Schicker filed suit against Klenda in the District Court of Douglas County, Nebraska. Filing 1-2 at 1. Schicker alleged Klenda had "tortuously [sic] violated [his] contract with Cady as [Klenda] actively lured Cady into violating the written contract with Plaintiff and then not honoring the attorneys lien." Filing 1-2 at 4. Schicker also alleged Klenda violated two sections of the Nebraska Unfair Insurance Trade Practices Act by making deceptive statements in violation of Neb. Rev. Stat. §§ 44-1525(2) & (10). Filing 1-2 at 5. Schicker sought 40% of the proceeds paid to Cady, plus costs and interests. Filing 1-2 at 5.

Klenda filed a Notice of Removal to this Court, asserting jurisdiction under 28 U.S.C. § 1331 because Schicker's claims arose out of an employee welfare benefit plan and were therefore governed by ERISA. Filing 1 at 2. Schicker did not oppose removal.² Klenda also filed a Notice of Related Case, stating that the case involved the same legal issues and arose out of the same factual circumstances as this Court's prior order in Schicker v. Lincoln Financial Group , No. 8:19-CV-295, 2019 WL 5579530, at *2 (D. Neb. Oct. 29, 2019) (" Schicker I "). In Schicker I , plaintiff Schicker brought similar claims of tortious interference with a contract and violation of the Nebraska Unfair Insurance Trade Practices Act against Klenda's employer, Lincoln Financial Group, for its handling of Cady's claim and payment. Id. at *1. The Court found that Schicker's tortious-interference claim was preempted by ERISA and that the Nebraska Unfair Insurance Trade Practices Act did not provide a private right of action. Id. at *4-5. Accordingly, the Court granted Lincoln Financial Group's Motion to Dismiss for failure to state a claim and dismissed Schicker's complaint. Id. at *5.

Klenda has now filed a Motion to Dismiss Schicker's claims in the present case, arguing, similarly to Schicker I , that the tort claim is preempted by ERISA and that the Nebraska Unfair Insurance Trade Practices Act does not provide a private right of action. Filing 7 at 2-3.

II. DISCUSSION

A. Standard of Review

A complaint must contain "a short and plain statement of the claim showing that the pleader is entitled to relief." Fed. R. Civ. P. 8(a)(2). To satisfy this requirement, a plaintiff must plead "enough facts to state a claim to relief that is plausible on its face." Corrado v. Life Inv'rs Ins. Co. of Am. , 804 F.3d 915, 917 (8th Cir. 2015) (quoting Bell Atlantic Corp. v. Twombly , 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007) ). "A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Barton v. Taber , 820 F.3d 958, 964 (8th Cir. 2016) (quoting Ashcroft v. Iqbal , 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009) ).

In analyzing a motion to dismiss, the Court must "accept as true all factual allegations in the complaint and draw all reasonable inferences in favor of the nonmoving party, but [is] not bound to accept as true ‘[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements’ or legal conclusions couched as factual allegations." McDonough v. Anoka Cty. , 799 F.3d 931, 945 (8th Cir. 2015) (citations omitted) (quoting Iqbal , 556 U.S. at 678, 129 S.Ct. 1937 ). "When considering a Rule 12(b)(6) motion, the court generally must ignore materials outside the pleadings, but it may consider some materials that are part of the public record or do not contradict the complaint, as well as materials that are necessarily embraced by the pleadings."

Ashford v. Douglas Cty. , 880 F.3d 990, 992 (8th Cir. 2018) (quoting Smithrud v. City of St. Paul , 746 F.3d 391, 395 (8th Cir. 2014) ).

B. ERISA Preemption of the Tortious-Interference Claim

Klenda first argues that Schicker's claim of tortious interference with a contract fails to state a claim upon which relief can be granted because it is preempted by ERISA. Filing 7 at 2-3. Klenda argues the Court's reasoning in Schicker I should apply in equal measure to the preemption issue in this case. Filing 7 at 3. Schicker responds that his tortious-interference claim is distinguishable because he has alleged Klenda was acting outside the scope of her employment, an issue not raised in Schicker I. Filing 8 at 3-4.

As the Court set forth at length in Schicker I , "ERISA is a comprehensive legislative scheme that includes an integrated system of procedures for enforcement that are essential to accomplish Congress' purpose of creating a comprehensive statute for the regulation of employee benefit plans." Moore v. Apple Cent., LLC , 893 F.3d 573, 576 (8th Cir. 2018) (quoting Dakotas & W. Minn. Elec. Indus. Health & Welfare Fund v. First Agency, Inc. , 865 F.3d 1098, 1101 (8th Cir. 2017) ). ERISA contains a preemption provision which states its enforcement provisions "shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan described in section 1003(a) of this title." 29 U.S.C. § 1144(a) ; Treasurer, Trs. of Drury Indus., Inc. Health Care Plan & Tr. v. Goding , 692 F.3d 888, 897 (8th Cir. 2012). "The term ‘State law’ includes all laws, decisions, rules, regulations, or other State action having the effect of law." 29 U.S.C. § 1144(c)(1).

"Congress intended courts to read this [preemption] provision broadly, in order to protect ERISA's ‘uniform regulatory regime over employee benefit plans.’ " Goding , 692 F.3d at 897 (quoting Aetna Health Inc. v. Davila , 542 U.S. 200, 208, 124 S. Ct. 2488, 159 L. Ed. 2d 312 (2004) ). "A State law ‘relates to’ an ERISA plan and is preempted if it has ‘a connection with or a reference to such a plan.’ " Pharm. Care Mgmt. Ass'n v. Gerhart , 852 F.3d 722, 728 (8th Cir. 2017) (quotation marks omitted) (quoting Express Scripts, Inc. v. Wenzel , 262 F.3d 829, 833 (8th Cir. 2001) ). This means that "any 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." Moore , 893 F.3d at 576 (quoting Davila , 542 U.S. at 208–09, 124 S. Ct. 2488 ).

In Schicker I , the Court relied on case law finding claims for state-law torts, such as a tortious-interference claim predicated upon plan benefits, "relate to" an employee benefit plan and are...