Coppe v. The Sac & Fox Casino Healthcare Plan et al
MEMORANDUM AND ORDER denying 8 DEFENDANT, The Plan's Motion to Dismiss. Signed by District Judge Richard D. Rogers on 3/13/15. (meh)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
Case No. 14-2598-RDR
THE SAC & FOX CASINO
BENEFIT MANAGEMENT, INC.
MEMORANDUM AND ORDER
This case is now before the court upon a motion to dismiss
or stay for failure to exhaust tribal remedies.
The motion is
brought by defendant Sac & Fox Casino Healthcare Plan.
motion asks the court to rule as a matter of comity that before
bringing a claim in this court, plaintiff must bring an ERISA
action for recovery of insurance benefits under the casino’s
nongovernmental plan in tribal court.
We assume for purposes of
this order that plaintiff is not a member of the Sac & Fox Tribe
and that the Plan is not a “governmental plan” as defined in
exhaustion of tribal remedies is not required.1
The parties’ pleadings do not allege that plaintiff is a member of the Sac &
Although we assume that she is not, this assumption is not
critical to the result which hinges mainly upon the conclusion that Congress
has preempted tribal court jurisdiction over ERISA claims for nongovernmental
Plaintiff was an employee of the Sac & Fox Casino.
casino, incurred substantial medical expenses in relation to a
pregnancy and the birth of a premature baby.
responsibility of defendant Sac & Fox Casino Healthcare Plan,
which, she alleges, is an employee welfare benefit plan governed
company, is alleged to be the Plan supervisor that administers
claims for Plan benefits.
The Plan had group health insurance
through American Fidelity Assurance in 2011.2
refused to pay what plaintiff asserts is owed pursuant to the
specifically, that defendants Benefit Management, Inc. and the
insurance benefits and seeks an order requiring their payment as
well as other relief.
This allegation is made as a “statement of fact” in response to the motion
Defendant Plan does not dispute the allegation in its reply
dismiss that the Plan states that a Plan member may file a claim
for benefits “in a state or federal court” and that there is no
reference to tribal courts in the Plan.
This allegation is not
disputed in defendant Plan’s reply brief.3
DEFENDANT PLAN’S ALLEGATIONS
Defendant Sac and Fox Casino Healthcare Plan has submitted
the following statements of fact in support of its motion to
dismiss or to stay.
The Sac and Fox Nation of Missouri in
Kansas and Nebraska is a federally-recognized Indian tribe.
Sac & Fox Casino is a non-corporate operating arm of the tribe.
The casino maintained a self-funded plan of healthcare benefits.
Money to fund the plan came from the casino’s general operating
The Plan was managed by the tribe’s council members
who hired defendant Benefits Management Inc. as a third-party
A judgment against the plan would likely come
While plaintiff argues that this permissive provision constitutes a waiver
of the right to proceed in tribal court, this argument itself could be
decided by the tribal court and therefore does not persuade us that
exhaustion is unnecessary for comity reasons.
The holding cited by
plaintiff, C&L Enterprises, Inc. v. Citizen Band Potawatomi Indian Tribe of
Oklahoma, 532 U.S. 422 (2001), is not contrary to this position. It involved
a mandatory provision which clearly waived tribal sovereign immunity as to
arbitration proceedings that had already been conducted and appealed to state
It did not involve an issue of tribal exhaustion on comity grounds
and a permissive provision which is less than clear.
Plaintiff disputes whether a judgment against the plan would likely come
directly from the Tribal treasury or the casino’s operating funds, arguing
presented by both sides.
Therefore, pursuant to FED.R.CIV.P.
12(d), the motion will be treated in effect as one for summary
We assume that there is no issue with this procedural
Our ruling hinges primarily upon the legal force of ERISA’s
Nevertheless, we note that the Supreme Court has stated
that the burden rests upon an Indian tribe to establish its
Plains Commerce Bank v. Long Family Land and Cattle Co., 554
U.S. 316, 330 (2008).
We further note that exhaustion issues
are often treated as affirmative defenses and, as such, the
burden of proving the defense rests on the defendant.
v. Bock, 549 U.S. 199, 212 (2007)(“the usual practice under the
The ERISA law provides that a participant or beneficiary in
the ERISA plan may bring an action to recover benefits due under
that the insurance company that issued the policy used by the Plan would be
responsible. We find that this disputed fact is not material to the holding
made in this order.
29 U.S.C. § 1132(a)(1)(B).
State courts and federal
section does not reference tribal courts.
ERISA does not regulate so-called “governmental plans.”
U.S.C. § 1003(b)(1). “Governmental plans” are defined to include
“a plan which is established and maintained by an Indian tribal
government . . . a subdivision of an Indian tribal government .
. . or an agency or instrumentality of either, and all of the
participants of which are employees of such entity substantially
all of whose services as such an employee are in the performance
of essential governmental functions but not in the performance
of commercial activities (whether or not an essential government
29 U.S.C. § 1002(32).
The motion to dismiss does
not allege that the Plan in this case is a “governmental plan.”
TRIBAL COURTS DO NOT HAVE JURISDICTION OVER ERISA ACTIONS.
adjudicative jurisdiction over nonmembers is at most only as
broad as their legislative jurisdiction.
Congress has not
purported to grant tribal courts jurisdiction over ERISA claims.5
This was also the situation in Nevada, where the court held that
there was no tribal court jurisdiction over an action under 42
U.S.C. § 1983 against a nonmember state law enforcement agent
for actions taken upon reservation land to investigate an offreservation crime.
The Court held that tribal rights to make
reservation did not exclude state authority (as exercised by
nonmembers of the tribe) to investigate off-reservation crimes
on the reservation.
Id. at 362-64.
The Court further held that
permitting tribal court jurisdiction over the § 1983 claim would
create a “serious anomaly” because the removal powers afforded §
1983 defendants in state court under 28 U.S.C. § 1441 would not
be available to a similar defendant in tribal court.
Here, we hold that tribal rights to make laws governing
members and to regulate activity upon the reservation does not
exclude federal authority as expressed in ERISA to occupy and
We note that, if an ERISA claim was
brought in tribal court against a nonmember defendant or if an
We acknowledge though that “[s]ilence is not sufficient to establish
congressional intent to strip Indian tribes of their retained inherent
authority to govern their own territory.”
N.L.R.B. v. Pueblo of San Juan,
276 F.3d 1186, 1196 (10th Cir. 2002).
described in Nevada would be present.
The power of an ERISA
defendant to remove the action to federal court, as exists for
state court ERISA defendants, would not be present.
right of an ERISA plaintiff to choose a federal forum at the
outset of an action would be infringed.
This holding is supported, even as to members of a tribe,
by the preemptive intent of Congress in passing ERISA.
Paso Natural Gas Co. v. Neztsosie, 526 U.S. 473 (1999), members
of the Navajo Nation brought claims in the Navajo tribal court
alleging that they were harmed by the conduct of uranium mining
companies operating upon the reservation in violation of Navajo
The Court held that the claims in tribal court
could be enjoined by a federal district court order because the
federal government, with the passage of the Price-Anderson Act,
had preempted any state law and any tribal law claims arising
from the mining of uranium or uranium ore and the byproducts of
This finding was based upon the Act’s “unusual
preemption provision” which the Court compared to the provisions
of the Labor Management Relations Act and ERISA.
484 n 6.
526 U.S. at
The Court stated:
The [Price-Anderson] Act not only gives a district
court original jurisdiction over such a claim . . .
but provides for removal to a federal court as of
right if a putative Price-Anderson action is brought
in a state court . . . Congress thus expressed an
unmistakable preference for a federal forum, at the
behest of the defending party, both for litigating a
Price-Anderson claim on the merits and for determining
whether a claim falls under Price-Anderson when
removal is contested.
Id. at 484-85.
force of ERISA in Aetna Health Inc. v. Davila, 542 U.S. 200,
Congress enacted ERISA to “protect . . . the interests
of participants in employee benefit plans and their
beneficiaries” by setting out substantive regulatory
requirements for employee benefit plans and to
“provid[e] for appropriate remedies, sanctions, and
ready access to the Federal courts.”
1001(b). The purpose of ERISA is to provide a uniform
regulatory regime over employee benefit plans.
provisions, see ERISA § 514, 29 U.S.C. § 1144, which
are intended to ensure that employee benefit plan
regulation would be “exclusively a federal concern.”
Alessi v. Raybestos-Manhattan, Inc., 451 U.S. 504,
523, 101 S.Ct. 1895, 68 L.Ed.2d 402 (1981).
ERISA’s “comprehensive legislative scheme” includes
“an integrated system of procedures for enforcement.”
Russell, 473 U.S., at 147, 105 S.Ct. 3085. (internal
quotation marks omitted). This integrated enforcement
mechanism, ERISA § 502(a), 29 U.S.C. § 1132(a), is a
distinctive feature of ERISA, and essential to
comprehensive statute for the regulation of employee
benefit plans. . . .
In Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58,
65-66, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987), the Court
determined that the similarity of the language used in
the Labor Management Relations Act, 1947 (LMRA), and
ERISA, combined with the “clear intention” of Congress
“to make § 502(a)(1)(B) suits brought by participants
or beneficiaries federal questions for the purposes of
federal court jurisdiction in like manner as § 301
LMRA,” established that ERISA § 502(a)(1)(B)’s preemptive force mirrored the pre-emptive force of LMRA §
301. Since LMRA § 301 converts state causes of action
into federal ones for purposes of determining the
propriety of removal . . . so too does ERISA §
mechanism is one of those provisions with such
“extraordinary pre-emptive power” that it “converts an
ordinary state common law complaint into one stating a
federal claim for purposes of the well-pleaded
complaint rule.” Metropolitan Life, 481 U.S., at 6566, 107 S.Ct. 1542.
Hence, “causes of action within
the scope of the civil enforcement provisions § 502(a)
[are] removable to federal court.”
Id. at 66, 107
Price-Anderson Act distinguishes the holding in Neztsosie from
the facts in this case.
We reject this argument because the
Neztsosie opinion compares the Price-Anderson Act to ERISA, and
the rights of removal set forth in the Price-Anderson Act (at 42
Congress in ERISA actions are similar.
As the Court stated in
Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 66 (1987) in
clearly manifested an intent to make causes of action within the
scope of the civil enforcement provisions of [ERISA] § 502(a)
Taylor, as in this case, the plaintiff was making a claim for
styled his claims as being made under state law.
Defendant Plan also argues that ERISA does not provide for
claims under § 1132(e).
This is not a significant distinction
U.S.C. § 2210(n)(2) only upon a motion of a defendant.
point is that access to a federal forum must be allowed to ERISA
defendants and plaintiffs and that such access via removal would
be denied to ERISA defendants if tribal courts had jurisdiction
to decide ERISA claims, and such access for ERISA plaintiffs
would be denied or at least infringed if cases were forced to be
brought initially in tribal court.
THE GOVERNMENT’S PREEMPTIVE ACTION UNDER ERISA DICTATES
THAT EXHAUSTION IN TRIAL COURT SHOULD NOT BE REQUIRED AS A
MATTER OF COMITY.
In Montana v. United States, 450 U.S. 544 (1981), the Court
held in general that the sovereign powers of an Indian tribe do
not extend to the activities of nonmembers of the tribe. But,
two exceptions were noted:
To be sure, Indian tribes retain inherent sovereign
power to exercise some forms of civil jurisdiction
over non-Indians on their reservations, even on nonIndian fee lands.
A tribe may regulate, through
taxation, licensing, or other means, the activities of
nonmembers who enter consensual relationships through
arrangements. . . . A tribe may also retain inherent
power to exercise civil authority over the conduct of
non-Indians on fee lands within its reservation when
that conduct threatens or has some direct effect on
the political integrity, the economic security, or the
health or welfare of the tribe.
450 U.S. 565-66.
In Strate v. A-1 Contractors, 520 U.S. 438, 453 (1997), the
Court said that the rule described in Montana applies to the
adjudicatory authority of tribal courts:
As to nonmembers, . . . a tribe’s adjudicative
enlarging tribal-court jurisdiction, we adhere to that
Subject to controlling provisions in
identified in Montana, the civil authority of Indian
tribes and their courts with respect to non-Indian fee
lands generally “do[es] not extend to the activities
of nonmembers of the tribe.”
(Quoting Montana, 450 U.S. at 565).
But, the application of
jurisdictional prohibition or it is otherwise clear that the
Burrell v. Armijo, 456 F.3d 1159, 1168 (10th Cir. 2006) cert.
denied, 549 U.S. 1167 (2007).
Here, we have held that it is
clear that the tribal court lacks jurisdiction.
So, we need not
consider exhaustion of tribal court remedies as a matter of
One other court has made a similar holding.
relied upon Neztsosie to hold that it should not abstain from
proceeded in tribal court. Vandever v. Osage Nation Enterprise,
(D.Ariz. 5/29/2013)(citing Vandever in support of a refusal to
abstain from deciding an ERISA claim brought by a fiduciary
involving competing claims of tribal members residing on Navajo
defendant Plan’s motion to dismiss (Doc. No. 8).
IT IS SO ORDERED.
Dated this 13th day of March, 2015, at Topeka, Kansas.
s/ RICHARD D. ROGERS
Richard D. Rogers
United States District Judge
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