Scarber v. United Airlines, Inc. et al
MEMORANDUM Opinion and Order. The Administrator's decision denying benefits was not downright unreasonable. Scarber's negligence claims are preempted by ERISA and are fatally deficient besides. The Court grants summary judgment to United on all remaining counts. Civil case terminated. Status hearing set for 10/24/18 is vacated. Signed by the Honorable Harry D. Leinenweber on 10/23/2018:Mailed notice(maf)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF ILLINOIS
Case No. 15 C 9147
UNITED AIRLINES, INC.;
TRACEY ROSE, SupervisorORDSW; ANNELLA SAHLIORDSW; and JEFF SMISEK,
President and CEO of
Judge Harry D. Leinenweber
MEMORANDUM OPINION AND ORDER
Defendants United Airlines, Inc., Traci Rose (incorrectly
sued as “Tracey”), Annella Sahli, and Jeff Smisek (collectively,
“United”) move for summary judgment on the two remaining claims
levied against them by Plaintiff Jerome Scarber.
moves for the same. For the reasons stated herein, United’s Motion
(Dkt. No. 70) is granted and Scarber’s Motion (Dkt. No. 74) is
In 2014, United adopted the so-called “Early Out Plan,” which
provided for lump-sum payments of between $60,000 and $100,000 in
voluntary severance to eligible employees.
(United’s Statement of
Facts (“SOF”) ¶ 14, Dkt. No. 72.)
Scarber met the eligibility
requirements for the Plan and wanted to become a participant. (Id.
¶¶ 9-10, 15-17; Scarber’s SOF ¶ 11, Dkt. No. 74.)
Scarber had to follow the same rules applicable to all other
eligible employees: by October 30, 2014, submit (1) a waiver of
rights and claims, and (2) an online election bid form via the
requirements were set forth both in the Plan itself and in a
question-and-answer document provided by United to its employees
in advance of the October 30 deadline.
(Id. ¶ 13.)
completed only the first of these two tasks, so he was not awarded
a lump-sum benefit under the Plan.
(Id. ¶¶ 18-26.)
for Scarber’s shortcoming is in dispute.
On October 20, 2014, Scarber went to O’Hare Airport in Chicago
for assistance in enrolling in the Plan.
(Id. ¶ 18.)
Defendant Traci Rose directed Defendant Annella Sahli—both United
employees—to assist him in enrolling.
requirements—on his behalf.
(Id. ¶¶ 19-20.)
(Id. ¶ 21.)
Scarber contends that
Sahli then asked him for his password to log into Unimatic/CSS and
that Sahli used that password to enter Scarber’s required bid form
(Scarber’s SOF ¶ 16.)
United disputes both of
those contentions (United’s Resp. to Scarber’s SOF ¶ 16, Dkt. No.
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86), and notes that Scarber’s Unimatic records show that no such
bid was entered during this meeting or at any other time (United’s
SOF ¶ 23).
To any extent, the parties agree that before Scarber
left O’Hare, one of the United employees told him he was “all set.”
(United’s SOF ¶ 21.)
But the following month, after the October 30 Plan-enrollment
deadline had passed, Scarber learned he would not receive a lumpsum benefit through the Plan. (Id. ¶ 24.) Upon contacting United,
Scarber learned his United bid had never been submitted online as
(Scarber’s SOF ¶ 19.)
Scarber filed a six-count Complaint in state court, which
United subsequently removed.
(See Notice of Removal, Dkt. No. 1.)
This Court then dismissed several of Scarber’s claims in two
See Scarber v. United Airlines, Inc., No. 15 C 9147,
2016 WL 3213405, at *1 (N.D. Ill. June 10, 2016); Scarber v. United
Airlines, Inc., No. 15 C 9147, 2016 WL 362377, at *1 (N.D. Ill.
Jan. 29, 2016). The second of those rulings stayed all proceedings
until Scarber exhausted his administrative remedies, which he has
now done: He filed a claim for benefits under the Plan, which was
denied; he then filed an appeal of that decision, which was denied
(United’s SOF ¶¶ 26-27.)
This matter thus returns to the Court’s attention. Two counts
remain: Count I, for enforcement of rights and benefits under ERISA
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negligence and negligent supervision.
Dkt. No. 35.)
(See generally Am. Compl.,
Both parties move for summary judgment.
Summary judgment must be granted “if the movant shows that
there is no genuine dispute as to any material fact and the movant
is entitled to judgment as a matter of law.”
FED. R. CIV. P. 56(a).
A genuine issue of material fact exists if “the evidence is such
that a reasonable jury could return a verdict for the nonmoving
Zaya v. Sood, 836 F.3d 800, 804 (7th Cir. 2016) (quoting
Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986)). When
evaluating summary judgment motions, courts must view the facts
and draw reasonable inferences in the light most favorable to the
Scott v. Harris, 550 U.S. 372, 378 (2007).
nonmovant “is only entitled to the benefit of inferences supported
by admissible evidence, not those ‘supported by only speculation
(7th Cir. 2017).
Grant v. Trs. of Ind. Univ., 870 F.3d 562, 568
On cross-motions for summary judgment, the
typical standard is applied to each motion in turn to determine
whether judgment should be entered as a matter of law.
Marcatante v. City of Chicago, 657 F.3d 433, 438-39 (7th Cir.
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Before reviewing the motions at bar, the Court notes that in
responding to United’s statement of material facts, Scarber failed
to adhere to Local Rule 56.1.
That Rule required Scarber to
respond concisely and, in the case of any disagreement, make
specific citations to the record.
N.D. Ill. L.R. 56.1(b)(3).
Scarber did not follow that rule.
Instead, he answered with
byzantine non-responses, such as: “Plaintiff though states what
Defendants stated in Paragraphs 11-12 and reiterates what is
(Scarber’s Resp. to United’s SOF ¶¶ 9-10, Dkt. No. 84.)
Rule 56.1 is meant to clarify the record and the disputes
concerning it; Scarber’s obfuscating responses fail to abide by
the letter and spirit of this Rule.
As such, all facts set forth
in United’s statement of material facts are deemed to be admitted.
See Friend v. Valley View Cmty. Unit Sch. Dist. 365U, 789 F.3d
707, 710 (7th Cir. 2015) (citing N.D. Ill. L.R. 56.1(b)(3)(C)).
Now on to the motions.
Count I – Enforcement of Rights Under
29 U.S.C. § 1132(a)(1)(B)
ruling denying him the lump-sum benefit paid out to others under
The proper standard of review for this inquiry depends
on whether the Plan confers upon the Administrator the power of
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Administrator’s decision only if it was arbitrary and capricious.
James v. Gen. Motors Corp., 230 F.3d 315, 317 (7th Cir. 2000)
(citing Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115
(1989); Allison v. Dugan, 951 F.2d 828, 832 (7th Cir. 1992)).
not, the Court conducts a de novo review of the decision.
Herzberger v. Standard Ins. Co., 205 F.3d 327, 329, 329-32 (7th
Here, the arbitrary-and-capricious standard clearly applies.
The Plan provides that:
The Plan Administrator . . . shall have all powers
enforcement of the Early Out Plan], including . . . the
right, power, discretion, and authority:
. . .
(b) To construe in his or her discretion all terms,
provisions, conditions, and limitations of the Early Out
. . .
(e) To determine in his or her discretion, all questions
regarding eligibility and participation; and
(f) To make a determination in his or her discretion as
to the right of any person to a benefit under the Early
Out Plan and to prescribe procedures to be followed by
Participants in obtaining benefits[.]
(Admin. Record 89, Dkt. No. 63-2.)
This language confers broad
discretion upon the Administrator and thus invokes the deferential
standard of review.
See Herzberger, 205 F.3d at 331 (reciting
that when plans indicate that “a discretionary determination is
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insulated from judicial review).
Under the applicable, “highly deferential” standard, Jenkins
v. Price Waterhouse Long Term Disability Plan, 564 F.3d 856, 861
(7th Cir. 2009), the Arbitrator’s decision will not be overturned
so long as at least one of the following is true: “(1) it is
possible to offer a reasoned explanation, based on the evidence,
for a particular outcome, (2) the decision is based on a reasonable
explanation of relevant plan documents, or (3) the administrator
has based its decision on a consideration of the relevant factors
that encompass important aspects of the problem.”
Cent. States, Se. & Sw. Areas Pension Fund, 360 F.3d 681, 686 (7th
Cir. 2004) (citations and internal quotation marks omitted).
another way, the Court will only interfere with the Administrator’s
decision if it was “downright unreasonable.”
317 (citations omitted).
James, 230 F.3d at
In judging the Administrator’s decision,
the Court does not ask whether it would reach the same conclusion,
but merely whether there is any rational support in the record for
See Fischer v. Liberty Life Assurance Co., 576 F.3d
369, 376 (7th Cir. 2009).
Finally, the review is limited to the
information in the administrative record.
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Perlman v. Swiss Bank
Corp. Comprehensive Disability Prot. Plan, 195 F.3d 975, 981-82
(7th Cir. 1999).
With the standard of review decided, the Court turns to the
As recited above, the Administrator
denied Scarber the Early-Out benefit because Scarber failed to
submit a valid bid through the Unimatic system as required.
Administrator’s Appeal Decision, AR 272, Dkt. No. 63-3 (reciting
Scarber’s failure); United Internal E-mail, AR 398, Dkt. No. 63-5
Further, the Administrator specifically noted that each
eligible United employee bore an individual responsibility to
enroll in the Plan.
(Administrator’s Appeal Decision, AR 272.)
As such, “[w]hether [Scarber] sought assistance with submitting
his Early Out Plan bid would not and cannot alter the express
requirements of the [Plan],” and thus Scarber’s reliance on the
conduct of Defendants Rose and Sahli provides him no recourse.
The Administrator also found that contrary to Scarber’s
allegations, “[t]he evidence does not support the contentions that
Ms. Sahli asked for Mr. Scarber’s password, that Mr. Scarber
provided his password to Ms. Sahli, or that Ms. Sahli submitted an
election bid form on Mr. Scarber’s behalf into the Unimatic/CCS
(Administrator’s Appeal Decision, AR 272 n.4.)
unreasonable” for the Administrator to deny Scarber the benefit he
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James, 230 F.3d at 317.
According to the Administrator’s
review, signing onto the Plan required two steps, yet Scarber
Administrator noted, unravel the Plan’s requirements.
Scarber fails to marshal any material argument in his favor; he
Administrator considered that explanation and found it unavailing
against the clearly-delineated Plan requirements.
denying benefits was premised upon a reasoned explanation, and the
Court is in no position to interfere.
See Militello, 360 F.3d at
Accordingly, the Court grants summary judgment on Count I to
B. Count IV – Negligence / Negligent Supervision
Scarber maintains he is entitled to summary judgment on Count
IV, though his evidence in support is thin.
Across the aisle,
negligence theories are preempted by ERISA and, even if they are
not preempted, the claims fail as a matter of law.
ERISA preemption is distinctly broad.
any and all State laws insofar as they . . . relate to any [ERISAgoverned] employee benefit plan.”
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29 U.S.C. § 1144(a).
includes “all laws, decisions, rules, regulations, or other State
action having the effect of law.”
29 U.S.C. § 1144(c)(1).
simply, “[i]f a state law ‘relate[s] to . . . employee benefit
plan[s],’ it is pre-empted.”
Pilot Life Ins. Co. v. Dedeaux, 481
U.S. 41, 45 (1987) (quoting 29 U.S.C. § 1144(a)), superseded by
statute on other grounds as stated in Hunter v. Ameritech, 779 F.
Supp. 419, 421 (N.D. Ill. 1991).
“The phrase ‘relate to’ [takes]
its broad common-sense meaning, such that a state law ‘relate[s]
to’ a benefit plan ‘in the normal sense of the phrase, if it has
a connection with or reference to such a plan.’” Id. at 47 (quoting
Metro. Life Ins. Co. v. Massachusetts, 471 U.S. 724, 739 (1985)
(quoting Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 97 (1983))).
specifically designed to affect employee benefit plans.”
463 U.S. at 98.
The Court considered Defendants’ ERISA preemption argument
once before and ruled that the negligence claims were not preempted
because whether United was negligent in processing Scarber’s bid
“does not depend on the terms of the Plan itself.”
WL 362377, at *4.
The Court then explained at a subsequent status
hearing that a fuller record could elucidate the issue.
2/17/2016 Status Hearing Tr.)
Since that time, the record has
been supplemented and the Supreme Court has handed down its
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decision in Gobeille v. Liberty Mutual Insurance Co., 136 S. Ct.
936 (2016), which reiterated the Court’s view that ERISA’s broad
preemption doctrine is intended to ensure “nationally uniform plan
Id. at 943 (citation omitted); see id. at 957
(Ginsburg, J., dissenting) (describing the majority in Gobeille as
retrieving from the “discard bin” a “super-preemption” doctrine).
Mindful of that decision, this Court looks to United’s preemption
argument with fresh eyes.
The key in the preemption analysis is whether the alleged
misfeasance constitutes a negligent denial of benefits as opposed
to a violation of some non-ERISA-imposed duty.
If the former, the
plaintiff’s action to recover for that negligence amounts to an
impermissible “end run” around ERISA.
See Zipperer v. Raytheon
Co., 493 F.3d 50, 52 (1st Cir. 2007) (finding preemption of
allegations that defendant’s negligent recordkeeping led plaintiff
to receive smaller pension payouts than he had been promised).
the latter, the negligence action is extraneous to the denial of
benefits and thus may escape ERISA preemption.
See Badal v.
Hinsdale Mem’l Hosp., No. 06 C 7164, 2007 WL 1424205, at *8 n.5
(N.D. Ill. May 8, 2007) (describing that preemption does not apply
when a plaintiff “attempt[s] to remedy [a] violation of a legal
duty independent of ERISA” (quoting Aetna Healthcare, Inc. v.
Davila, 542 U.S. 200, 214 (2004))).
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A recent decision from this District provides an example of
the line-drawing exercise involved here.
In Wigdahl v. Fox Valley
Family Physicians, No. 18 C 3513, 2018 WL 4520380, at *1 (N.D.
followed the provider’s advice to visit urgent care rather than an
emergency room, and later died.
In relevant part, the plaintiff
alleged the defendant-provider had acted negligently in dispensing
“involve[d] determinations under [the decedent’s] insurance plan
as to the necessity of certain medical care, thus bringing them
within ERISA’s scope” and so into preempted territory.
court, however, was not convinced:
[The plaintiff’s claims] do not involve coverage or
eligibility decisions. She does not claim [the
defendant] failed to provide medically necessary
treatment or other benefits to which [her deceased
husband] was entitled under the plan. Instead, she
alleges [the defendant] . . . acted negligently . . .
[by] failing to direct him to an emergency room.
The Court thus allowed the negligence allegations to stand.
In so concluding, the court contrasted its decision with Jass
v. Prudential Health Care Plan, Inc., 88 F.3d 1482, 1488 (7th Cir.
1996), superseded on other grounds as stated in Samaritan Health
Center v. Simplicity Health Care Plan, 459 F. Supp. 2d 786, 793
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determination that the plaintiff did not require physical therapy
amounted to a denial of benefits and so could only be challenged
See Wigdahl, 2018 WL 4520380, at *3 (characterizing
Jass); cf. Corcoran v. United Healthcare, Inc., 965 F.2d 1321,
hospitalization), abrogated on other grounds as recognized in
Hager v. DBG Partners, Inc., 903 F.3d 460, 469 n.41 (5th Cir.
2018); Carson v. Am. Quality Sch. Corp. Thea Bowman Leadership
Acad., No. 2:15CV348, 2016 WL 1699789, at *1 (N.D. Ind. Apr. 28,
2016) (finding preemption of claim that insurer negligently and
improperly processed plaintiff’s claim for benefits).
Here, the negligence alleged does not fit neatly into the
context described in either Wigdahl or Jass.
Rose and Sahli were
But their negligence was neither wholly
unrelated to the denial of benefits (as in Wigdahl) nor a denial
in and of itself (as in Jass).
Further complicating matters is
that here—as the Administrator noted in denying Scarber’s appeal—
enrollment upon Scarber alone.
From Scarber’s perspective, that complication does not much
He believes the alleged negligence is an intervening
force; but for said negligence, he would have enrolled in the Plan
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negligence he alleges is independent of the decision to deny
benefits and should therefore avoid preemption.
See Lancaster v.
Chandra, No. 93 C 2717, 1994 WL 33962, at *5 (N.D. Ill. Feb. 4,
1994); see also Badal, 2007 WL 1424205, at *8 n.5.
From United’s perspective, however, the complication matters
United believes that it is impossible, without reference
to the Plan’s terms, to weigh Scarber’s excuses for failing to
submit his Unimatic bid.
Thus, because Scarber’s negligence
“relate to” the Plan and must be preempted.
See Jackman Fin. Corp.
v. Prudential Ins. Co. of Am., No. 09-CV-06430, 2010 WL 3800892,
at *3 (N.D. Ill. Sept. 22, 2010) (reciting that allegations
requiring the court to inquire into the plan’s terms must be
But for the Court to adopt Scarber’s perspective, he must
demonstrate that Rose and Sahli bore a non-ERISA-imposed duty to
render adequate assistance.
See Parkview Hosp., Inc. v. White’s
Residential & Family Servs., Inc., No. 1:07-CV-0208 WCL, 2008 WL
89878, at *3 (N.D. Ind. Jan. 7, 2008).
Scarber has failed in this
He does not establish, nor even allege, that Rose and
Sahli owed him any duty of care in helping him enroll in the Plan.
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Scarber thus fails to establish any independent legal basis for
his claim as required to avoid preemption.
See Franciscan Skemp
Healthcare, Inc. v. Cent. States Joint Bd. Health & Welfare Tr.
Fund, 538 F.3d 594, 597 (7th Cir. 2008) (citing Davila, 542 U.S.
preemption, it would still spell ruin for Scarber’s negligence
allegations given the axiom that “unless a duty is owed, there is
Doe v. Boy Scouts of Am., 4 N.E.3d 550, 559 (Ill.
App. Ct. 2014) (quoting LaFever v. Kemlite Co., 706 N.E.2d 441,
446 (Ill. 1998) (quoting Am. Nat’l Bank & Tr. Co. of Chi. v. Nat’l
Advertising Co., 594 N.E.2d 313, 318 (Ill. 1992))).
Scarber’s negligent supervision theory fares equally poorly.
To prevail on that theory, Scarber must prove that United knew or
should have known that Rose and Sahli had a “particular unfitness”
for their positions so as to create a danger of harm to third
Van Horne v. Muller, 705 N.E.2d 898, 904 (Ill. 1998)
Yet Scarber fails to prove (or, again, even
allege) that Rose and Sahli were particularly unfit for their
As the Seventh Circuit has often observed, “summary judgment
is the ‘put up or shut up’ moment in a lawsuit, when a party must
show what evidence it has that would convince a trier of fact to
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accept its version of events.”
Koszola v. Bd. of Educ. of City of
Chi., 385 F.3d 1104, 1111 (7th Cir. 2004) (citations and internal
quotation marks omitted), overruled in other part by Ortiz v.
Werner Enters., Inc., 834 F.3d 760 (7th Cir. 2016).
evidence falls far short of the summary judgment standard he
invites by his motion, and he fails to establish any genuine issue
of material fact counselling against awarding judgment to his
His Motion thus fails on Count IV, and United’s Motion
Scarber’s negligence claims are preempted
by ERISA and are fatally deficient besides.
The Court grants
summary judgment to United on all remaining counts.
IT IS SO ORDERED.
Harry D. Leinenweber, Judge
United States District Court
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