Harper v. Diebold Incorporated
Filing
18
MEMORANDUM DECISION AND ORDER granting with leave to amend the complaint 4 Motion to Dismiss; denying as moot 11 Motion to Amend/Correct. Signed by Judge B. Lynn Winmill. (caused to be mailed to non Registered Participants at the addresses listed on the Notice of Electronic Filing (NEF) by (cjm)
UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF IDAHO
DARREN W. HARPER,
Case No. 1:12-cv-031-BLW
Plaintiff,
MEMORANDUM DECISION AND
ORDER
v.
DIEBOLD INCORPORATED, a foreign
corporation,
Defendant.
INTRODUCTION
The Court has before it Defendant’s Motion to Dismiss (Dkt. 4) pursuant to
Federal Rule of Civil Procedure 12(b)(6). Also before the Court is Plaintiff’s Motion to
MEMORANDUM DECISION AND ORDER - 1
Amend Complaint (Dkt. 11) pursuant to Rule 15(a). The motions are fully briefed and at
issue. For the reasons expressed below, the Court will GRANT the Motion to Dismiss
with leave to amend and DENY as moot the Motion to Amend the Complaint.
BACKGROUND
On December 16, 2011, Plaintiff Darren Harper filed a Complaint in the District
Court of the Fifth Judicial District of Idaho, in and for the County of Jerome, asserting
state law claims for breach of contract and unpaid wages against Defendant Diebold
Incorporated. Compl., Dkt. 1-1. Plaintiff alleges that Diebold breached its Separation
Benefits Plan and failed to pay him benefits pursuant to the terms of the plan, which
Diebold contends is an employee benefit plan as defined by the Employee Retirement
Income Security Act (“ERISA”). Id. at ¶ 3-7; Def.’s Br. at 2, 9-18, Dkt. 4. As a result,
Diebold removed the action to federal court and filed a Motion to Dismiss Plaintiff’s state
law claims. Compl., 1-2, Dkt. 1.
Meanwhile, Plaintiff moved to amend his Complaint, asserting an ERISA claim in
addition to his existing state law claims. Am. Compl. 1, Dkt. 11. While Defendant does
not object to Plaintiff proceeding solely on a claim under ERISA, Diebold takes issue
with the Amended Complaint because it asserts both state law and ERISA claims.
Accordingly, Diebold opposes Plaintiff’s Motion to Amend Complaint and objects to
Plaintiff’s proposed Amended Complaint in its current form. Def’s Resp. at 2, Dkt. 15.
LEGAL STANDARD
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Federal Rule of Civil Procedure 8(a)(2) requires only “a short and plain statement
of the claim showing that the pleader is entitled to relief,” in order to “give the defendant
fair notice of what the . . . claim is and the grounds upon which it rests.” Bell Atlantic
Corp. v. Twombly, 550 U.S. 544, 555, 127 S.Ct. 1955, 1964 (2007). While a complaint
attacked by a Rule 12(b)(6) motion to dismiss “does not need detailed factual
allegations,” it must set forth “more than labels and conclusions, and a formulaic
recitation of the elements of a cause of action will not do.” Id. at 555. To survive a
motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to
“state a claim to relief that is plausible on its face.” Id. at 570. 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. Id. at 556.
The plausibility standard is not akin to a “probability requirement,” but it asks for more
than a sheer possibility that a defendant has acted unlawfully. Id. Where a complaint
pleads facts that are “merely consistent with” a defendant's liability, it “stops short of the
line between possibility and plausibility of ‘entitlement to relief.’ ” Id. at 557.
In a more recent case, the Supreme Court identified two “working principles” that
underlie Twombly. See Ashcroft v. Iqbal, 129 S.Ct. 1937, 1949 (2009). First, the tenet
that a court must accept as true all of the allegations contained in a complaint is
inapplicable to legal conclusions. Id. “Rule 8 marks a notable and generous departure
from the hyper-technical, code-pleading regime of a prior era, but it does not unlock the
doors of discovery for a plaintiff armed with nothing more than conclusions.” Id. at
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1950. Second, only a complaint that states a plausible claim for relief survives a motion
to dismiss. Id. “Determining whether a complaint states a plausible claim for relief will .
. . be a context-specific task that requires the reviewing court to draw on its judicial
experience and common sense.” Id.
Providing too much in the complaint may also be fatal to a plaintiff. Dismissal
may be appropriate when the plaintiff has included sufficient allegations disclosing some
absolute defense or bar to recovery. See Weisbuch v. County of L.A., 119 F.3d 778, 783,
n. 1 (9th Cir. 1997) (stating that “[i]f the pleadings establish facts compelling a decision
one way, that is as good as if depositions and other . . . evidence on summary judgment
establishes the identical facts”).
A dismissal without leave to amend is improper unless it is beyond doubt that the
complaint “could not be saved by any amendment.” Harris v. Amgen, Inc., 573 F.3d 728,
737 (9th Cir. 2009)(issued 2 months after Iqbal).1 The Ninth Circuit has held that “in
dismissals for failure to state a claim, a district court should grant leave to amend even if
no request to amend the pleading was made, unless it determines that the pleading could
not possibly be cured by the allegation of other facts.” Cook, Perkiss and Liehe, Inc. v.
Northern California Collection Service, Inc., 911 F.2d 242, 247 (9th Cir. 1990). The
1
The Court has some concern about the continued vitality of the liberal amendment policy adopted in
Harris v. Amgen, based as it is on language in Conley v. Gibson, 355 U.S. 41, 45-46 (1957), suggesting
that “a complaint should not be dismissed for failure to state a claim unless it appears beyond doubt that
the plaintiff can prove no set of facts in support of his claim. . ..” Given Twombly and Iqbal’s rejection
of the liberal pleading standards adopted by Conley, it is uncertain whether the language in Harris v.
Amgen has much of a life expectancy.
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issue is not whether plaintiff will prevail but whether he “is entitled to offer evidence to
support the claims.” Diaz v. Int’l Longshore and Warehouse Union, Local 13, 474 F.3d
1202, 1205 (9th Cir. 2007)(citations omitted).
Under Rule 12(b)(6), the Court may consider matters that are subject to judicial
notice. Mullis v. United States Bank, 828 F.2d 1385, 1388 (9th Cir. 1987). The Court
may take judicial notice “of the records of state agencies and other undisputed matters of
public record” without transforming the motions to dismiss into motions for summary
judgment. Disabled Rights Action Comm. v. Las Vegas Events, Inc., 375 F.3d 861, 866
(9th Cir. 2004). The Court may also examine documents referred to in the complaint,
although not attached thereto, without transforming the motion to dismiss into a motion
for summary judgment. See Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005).
ANALYSIS
“ERISA is a comprehensive statute designed to promote the interest of employees
and their beneficiaries in employee benefit plans.” Ingersoll-Rand Co. v. McClendon,
498 U.S. 133, 136 (1990) (internal citation omitted). ERISA’s broad preemption
provision proscribes interference with rights protected by ERISA – including state laws
and state causes of action related to an employee benefit plan. 29 U.S.C. § 1144(a)1; see
also Ingersoll-Rand Co., 498 U.S. at 137-138. “Even claims brought under state law
doctrines that do not explicitly refer to employee benefit plans are preempted when the
claims arise from the administration of such plans whether directly or indirectly.” Gibson
1
“[T]he provisions of this subchapter … shall supersede any and all State laws insofar as they may now or hereafter
relate to any employee benefit plan…” 29 U.S.C. § 1144(a).
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v. Prudential Ins. Co., 915 F.2d 414, 416 (9th Cir. 1990) (internal citations omitted); see
also Lafferty v. Solar Turbines Int’l, 666 F.2d 408 (9th Cir. 1982) (common law breach
of contract cause of action preempted by ERISA). Therefore, ERISA preempts state law
contract and wage claims to the extent that such claims relate to employee benefit plans.
Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 47-48 (1987) (common law causes of action
based on employee benefit plan “undoubtedly meet the criteria for preemption”).
Plaintiff’s Complaint contains two causes of action – one for breach of contract
and the other for unpaid wages – both of which are based on state common law theories
of liability. Compl. ¶¶ 3-10, Dkt. 1-1. Thus, Plaintiff’s Complaint fails to state any
plausible claim upon which relief can be granted because his state law claims are based
directly upon the Separation Benefits Plan, and therefore fall directly under ERISA’s
broad preemption. Def.’s Br. at 3, Dkt. 4. Because ERISA preempts such causes of
action, the Court is compelled to dismiss Plaintiff’s Complaint pursuant to Rule 12(b)(6)
insofar as it relates to a cause of action based on state law.
Likewise, Plaintiff cannot proceed on both state law and ERISA claims because
his state law claims are preempted by ERISA. Def.’s Resp. at 2, Dkt. 15; Am. Compl. ¶ 3,
Dkt. 11. Therefore, consistent with the Court’s ruling to dismiss Plaintiff’s state law
claims, Plaintiff’s Motion to Amend Complaint is moot inasmuch as it seeks to assert
state law claims. Accordingly, the Court will deny Plaintiff’s Motion to Amend
Complaint in its current form. The Court will, however, grant leave for Plaintiff to amend
his original complaint to assert his ERISA claims.
MEMORANDUM DECISION AND ORDER - 6
ORDER
IT IS ORDERED:
1.
Defendant’s Motion to Dismiss (Dkt. 4) is GRANTED WITH LEAVE
TO AMEND THE COMPLAINT.
2.
Plaintiff’s Motion to Amend Complaint (Dkt. 11) is DENIED AS MOOT.
DATED: April 25, 2012
_________________________
B. Lynn Winmill
Chief Judge
United States District Court
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