Silfani v. J.B. Hunt Transport, Inc.
Judge Richard G. Stearns: ORDER entered granting in part and denying in part 33 Motion for Judgment on the Pleadings. "For the foregoing reasons, J.B. Hunt's motion to for judgment on the pleadings is ALLOWED IN PART (with respect to ERISA-governed plan benefits), and otherwise DENIED." (RGS, int2)
UNITED STATES DISTRICT COURT
DISTRICT OF MASSACHUSETTS
CIVIL ACTION NO. 15-10010-RGS
WILLIAM REMINGTON and MUSAN DURAKOVIC,
on behalf of themselves and others similarly situated
J.B. HUNT TRANSPORT, INC.
--CIVIL ACTION NO. 15-13019-RGS
on behalf of himself and others similarly situated
J.B. HUNT TRANSPORT, INC.
MEMORANDUM AND ORDER ON DEFENDANT’S
CONSOLIDATED MOTION FOR JUDGMENT ON THE PLEADINGS
April 28, 2017
This is the latest chapter in a preemption saga. Defendant J.B. Hunt
contends that the Federal Aviation Administration Authorization Act
(FAAAA), 49 U.S.C. § 14501 et seq., and the Employee Retirement Income
Security Act (ERISA), 29 U.S.C. § 1001 et seq., preempt what remains of
plaintiffs’ state law employee misclassification claims.
The factual allegations of the two class-action Complaints are set out
in this court’s decision on defendants’ consolidated motion to dismiss, see
Remington v. J.B. Hunt Transp., Inc. (Remington III), 2016 WL 4975194
(D. Mass. Sept. 16, 2016), and will be repeated here only to the extent
necessary. Plaintiffs are owner-operator drivers for J.B. Hunt Transport
Inc., a freight and package delivery service. Plaintiffs allege that while their
job descriptions and work requirements essentially replicate those of nonowner drivers hired by J.B. Hunt, they are not given the same employment
benefits. Plaintiffs base their claims on the Massachusetts Independent
Contractor Statute, Mass. Gen. Laws ch. 149, § 148B, and the Massachusetts
Wage Act, Mass. Gen. Laws ch. 149, §§ 148, 150. They also press an equitable
claim for unjust enrichment.1
In its first motion to dismiss, J.B. Hunt argued that the FAAAA’s
express preemption of state laws “related to a price, route, or service of any
motor carrier,” 49 U.S.C. § 14501(c)(1), usurps prong two of the Independent
Contractor Statute.2 J.B. Hunt further asserted that because prong two was
Silfani’s claim for breach of contract is not at issue in this motion.
Under the Independent Contractor Statute, a worker is properly
classified as an independent contractor if the employer can show that:
not severable, the Statute as a whole was preempted. This court agreed.
Remington v. J.B. Hunt Transp., Inc. (Remington I), 2015 WL 501884, at
*1-2 (D. Mass. Feb. 5, 2015); Schwann v. Fedex Ground Package Sys., Inc.,
2015 WL 501512, at *1-2 (D. Mass. Feb. 5, 2015).3 In addition, this court
ruled that the FAAAA preempted the Statute as a whole because “enforcing
prongs one and three of section 148B against motor carriers would end the
same – the ‘price, route[s], [and] services’ offered by motor carriers would
be impacted by forbidding the preferred business model.” Remington I,
2015 WL 501884, at *2.
On appeal, the First Circuit affirmed this court’s holding with respect
to prong two of the Statute. See Schwann v. FedEx Ground Package Sys.,
(1) the individual is free from control and direction in connection
with the performance of the service, both under his contract for
the performance of service and in fact; and
(2) the service is performed outside the usual course of the
business of the employer; and,
(3) the individual is customarily engaged in an independently
established trade, occupation, profession or business of the same
nature as that involved in the service performed.
Mass. Gen. Laws ch. 149, § 148B.
Schwann presented the FAAAA preemption issue at approximately
the same time, and this court issued substantially identical opinions in the
two cases. Schwann became the lead case on appeal.
Inc., 813 F.3d 429, 435-440 (1st Cir. 2016). However, the Court of Appeals
went on to hold that, contrary to this court’s opinion, prong two is severable.
Id. at 440-441. The First Circuit also reversed this court’s decision with
respect to prongs one and three of the Statute because defendants had not
raised the issue in the district court or on appeal. Id. at 441; Remington v.
J.B. Hunt Transp. (Remington II), No. 15-1252 (1st Cir. Feb. 22, 2016).
After the cases were remanded, J.B. Hunt filed a consolidated renewed
motion to dismiss in Remington and in the later-filed Silfani,4 arguing that
the misclassification claims were independently preempted by the federal
Truth-in-Leasing Regulations, 49 C.F.R. § 376.
This court held that
plaintiffs’ claims were preempted insofar as they were based on contractually
allocated cost-sharing, Remington III, 2016 WL 4975194, at *3-5, but that
claims based on other forms of unregulated compensation and benefits were
not so preempted, id., at *5-6. J.B. Hunt now, for the first time, contends
that the FAAAA preempts prongs one and three of the Independent
Contractor Statute. J.B. Hunt also maintains that ERISA preempts the
recovery of employee benefits administered by ERISA-governed plans.
Because Silfani raised identical preemption issues, the parties
stipulated to stay the case pending the appeal of Remington I and Schwann.
Plaintiffs assert, as a threshold matter, that because the First Circuit
reversed this court’s FAAAA preemption ruling as to prongs one and three
on the prior appeal, the law of the case doctrine bars J.B. Hunt from
attempting to revisit the issue on remand.5 See United States v. Matthews,
643 F.3d 9, 12-13 (1st Cir. 2011) (“In other words, the doctrine bars a party
from resurrecting issues that either were, or could have been, decided on an
earlier appeal.”). J.B. Hunt counters that because the First Circuit did not
substantively decide the issue, it remains fair game. See Biggins v. Hazen
Paper Co., 111 F.3d 205, 209 (1st Cir. 1997) (“Broadly speaking, mandates
require respect for what the higher court decided, not for what it did not
After a careful review of the prior proceedings, the court agrees with
plaintiffs that the doorway to further FAAAA preemption is now
permanently closed. In dismissing the Complaint in Remington I, the court
Although not the basis of this decision, the court notes that in recent
months the Supreme Judicial Court of Massachusetts and two sessions of the
District Court have ruled that the FAAAA does not in fact preempt prongs
one and three. See Chambers v. RDI Logistics, Inc., 476 Mass. 95, 105-108
(2016); DaSilva v. Border Transfer of MA, Inc., 2017 WL 58953, at *3-5 (D.
Mass. Jan. 5, 2017) (Saris, J.); Vargas v. Spirit Delivery & Distribution
Servs., Inc., 2017 WL 1115163, at *8-10 (D. Mass. Mar. 24, 2017) (Hillman,
ruled that the Independent Contractor Statute as a whole was preempted as
applied to motor carriers both because preempted prong two was not
severable from prongs one or three, and because prongs one and three were
independently preempted. See Remington I, 2015 WL 501884, at *2. On
appeal, plaintiffs-appellants advanced arguments challenging both of these
conclusions. See Schwann, 813 F.3d at 441. Defendant-appellee, however,
elected not to defend the independent preemption of prongs one and three.
Id., Remington II, No. 15-1252. Having kept silent when the issue was
squarely presented on appeal, Remington let go its opportunity and cannot
now claim buyer’s remorse. See United States v. Rodriguez, 311 F.3d 435,
437 (1st Cir. 2002) (a right is waived if intentionally relinquished or
abandoned, and forfeited if not timely asserted); see also Remington II, No.
15-1252 (permitting the district court, on remand, to “address for the first
time” other Wage Act preemption arguments raised by J.B. Hunt).
J.B. Hunt is on firmer footing, however, with respect to its ERISA
preemption contention. ERISA “supersede[s] any and all State laws insofar
as they . . . relate to any [qualified] employee benefit plan.” 29 U.S.C. §
1144(a). The ERISA preemption analysis proceeds in in two steps: “(1)
whether the plan at issue is an ‘employee benefit plan’ and (2) whether the
cause of action ‘relates to’ this employee benefit plan.” McMahon v. Digitial
Equip. Corp., 162 F.3d 28, 36 (1st Cir. 1998). The parties do not dispute
under step one that plaintiffs seek to recover benefits that they would have
received had they been classified as employees under ERISA-administered
The parties contest whether, at step two, plaintiffs’ Wage Act claims are
“related to” the ERISA plans. J.B. Hunt argues that its ERISA-administered
benefit plans are integral to plaintiffs’ claims because the court necessarily
has to construe and interpret the plans in order to adjudicate plaintiffs’
alleged eligibility and to determine the value of any benefits they would have
received under the plans.
For their part, plaintiffs characterize this
connection as “incidental.” Opp’n at 20. See Boston Children’s Heart
Found., Inc. v. Nadal-Ginard, 73 F.3d 429, 439 (1st Cir. 1996). Plaintiffs
maintain that they are not seeking to recover benefits under the plans, and
that the Wage Act claims are not dependent on the existence of an ERISA
plan. Rather, the value of any lost benefits is simply a component of their
damages writ large. More to the point, according to plaintiffs, their Wage
Law claims do not impede any of ERISA’s enforcement interest – as they are
not plan participants, plaintiffs concede they have no standing to assert an
Plaintiffs’ claims for non-plan benefits such as vacation, personal
days, and sick time, are not affected by ERISA preemption.
ERISA claim. Finally, plaintiffs assert that any preclusion of the Wage Act
benefits claims would leave them essentially without a remedy for their
Although plaintiffs accurately note that their Wage Act claims do not
intrude on the internal administration of an ERISA plan, that is not the test
of ERISA preemption.
ERISA preemption is “deliberately expansive.”
Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 138 (1990) (quoting Pilot
Life Ins. Co. v. Dedeaux, 481 U.S. 41, 46 (1987)). A state law may be
preempted as related to an ERISA plan “even if the law is not specifically
designed to affect such plans, or the effect is only indirect and even if the law
is consistent with ERISA’s substantive requirements.” District of Columbia
v. Great Washington Bd. of Trade, 506 U.S. 125, 130 (1992) (internal
quotation marks and citations omitted); see also Rosario-Cordero v.
Crowley Towing & Transp. Co., 46 F.3d 120, 123 (1st Cir. 1995).
“forbidden connection” between a state law and ERISA is determined by “the
objectives of the ERISA statute as a guide to the scope of the state law that
Congress understood would survive, as well as to the nature of the effect of
the state law on ERISA plans.”
California Div. of Labor Standards
Enforcement v. Dillingham Constr., 519 U.S. 316, 325 (1997) (internal
quotation marks and citations omitted).
“ERISA’s objectives include
providing a uniform national administration of ERISA plans and avoiding
inconsistent state regulation of such plans.” Zipperer v. Raytheon Co., 493
F.3d 50, 53 (1st Cir. 2007) (internal quotation marks omitted).
Three categories of state regulation that have been identified as
conflicting with these objectives are: 1) those that mandate
employee benefit structures or their administration; 2) those that
bind plan administrators to a particular choice; and 3) causes of
action that provide alternative enforcement mechanisms to
ERISA’s own enforcement scheme.
Plaintiffs’ claims, whatever the basis of the underlying cause of action,
can be distilled as non-participants seeking to recover the value of benefits
they would have received as ERISA plan participants. The First Circuit has
squarely held that such claims are preempted as being “related to” ERISA.
In Hamper v. W.R. Grace & Co., Inc., 202 F.3d 44 (1st Cir. 2000), plaintiff
alleged a breach of contract for his employer’s failure to include him as a
participant in a retirement plan as promised in his employment agreement.
The Court deemed this an impermissible “alternative enforcement
mechanism” because plaintiff’s eligibility and entitlement to benefits could
only be determined by reference to the plan itself. Id. at 51.
We have consistently held that a cause of action “relates to” an
ERISA plan when a court must evaluate or interpret the terms of
the ERISA-regulated plan to determine liability under the state
law cause of action. . . . We have [also] held that ERISA preempts
state law causes of action for damages where the damages must
be calculated using the terms of an ERISA plan.
Id. at 52.
Applying these principles, in Reyes v. S.J. Servs., Inc., 2014 WL
5485943, at *13-14 (D. Mass. Sept. 22, 2014), this court found the employees’
Wage Act claim for promised but undelivered ERISA plan benefits to be
preempted. “Resolution of this case would require [the court] to look to the
plan at least to determine damages, and likely liability as well, and therefore
plaintiffs’ state law claims are preempted by ERISA § 514(a).” Id. at *14.
Likewise, to adjudicate plaintiffs’ Wage Act benefit claims here, the court
would be required to look to the terms of the ERISA plans to determine
whether, had plaintiffs been classified as employees, they would have been
eligible as plan participants, as well as to determine the value of the benefits
the plans would have conferred.
Plaintiffs’ counterarguments, while creative, are unavailing. Plaintiffs
insist that the court need not look to the plans to determine their eligibility
because by the terms of the plans, having been classified as independent
contractors, they would not be eligible.
This reasoning, attempting to
divorce the claims from the plan terms by referencing the plan terms
themselves, is self-defeating. Plaintiffs also suggest alternative damages
computation methods, such as the use of statistical data to calculate benefits
as a percentage of income.
Given that plaintiffs’ alleged harm is the
deprivation of benefits under the specific plans administered by J.B. Hunt,
“[a]ny other measure of damages would be based on pure speculation.” Id.
Because plaintiffs’ claims for benefits “relate to” J.B. Hunt’s ERISA plans,
they are preempted.7, 8
This result is compelled even if, as plaintiffs state, ERISA does not
provide a comparable remedy for their claims. In enacting ERISA, Congress
intended its civil enforcement provisions to be exclusive.
[T]he detailed provisions of [ERISA] § 502(a) set forth a
comprehensive civil enforcement scheme that represents a
careful balancing of the need for prompt and fair claims
settlement procedures against the public interest in encouraging
the formation of employee benefit plans. The policy choices
reflected in the inclusion of certain remedies and the exclusion
of others under the federal scheme would be completely
undermined if ERISA-plan participants and beneficiaries were
free to obtain remedies under state law that Congress rejected in
“The six carefully integrated civil enforcement
provisions found in § 502(a) of the statute as finally enacted . . .
provide strong evidence that Congress did not intend to
authorize other remedies that it simply forgot to incorporate
Pilot Life, 481 U.S. at 54 (citation omitted, emphasis in original).
The court also agrees with J.B. Hunt that plaintiffs cannot sustain an
equitable theory of recovery to the extent that they have an adequate remedy
at law. See DaSilva, 2017 WL 58953, at *5 (“The Massachusetts Wage Act is
available as a statutory remedy, and that is sufficient to bar unjust
For the foregoing reasons, J.B. Hunt’s motion to for judgment on the
pleadings is ALLOWED IN PART (with respect to ERISA-governed plan
benefits), and otherwise DENIED.
/s/ Richard G. Stearns
UNITED STATES DISTRICT JUDGE
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