Meriwether v. Metropolitan Life Insurance Company
Filing
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MEMORANDUM AND ORDER: The Court finds that it lacks jurisdiction to consider this action further and hereby REMANDS it to the Metropolitan General Sessions Court of Davidson County, Tennessee. All other pending motions are DENIED AS MOOT. The Clerk is directed to close the file. Signed by Magistrate Judge Alistair Newbern on 12/18/2017. (xc: General Sessions Clerk by certified mail)(DOCKET TEXT SUMMARY ONLY-ATTORNEYS MUST OPEN THE PDF AND READ THE ORDER.)(ab)
UNITED STATES DISTRICT COURT
FOR THE MIDDLE DISTRICT OF TENNESSEE
NASHVILLE DIVISION
CRYSTAL MERIWETHER,
Plaintiff,
Case No. 3:16-cv-02463
v.
Magistrate Judge Newbern
METROPOLITAN LIFE INSURANCE
COMPANY,
Defendant.
METROPOLITAN LIFE INSURANCE
COMPANY,
Third-Party Plaintiff,
v.
ANGELINE HUGHES and CIERA
HOLMAN,
Third-Party Defendants.
MEMORANDUM AND ORDER
I.
Introduction
Plaintiff Crystal Meriwether initiated this action on August 12, 2016, by filing a civil
warrant summoning Defendant Metropolitan Life Insurance Company (MetLife) to appear in the
Metropolitan General Sessions Court of Davidson County, Tennessee. (Doc. No. 1-1, PageID# 4.)
The warrant states the cause of action as:
Breach of Life Insurance contract to pay death benefit to Plaintiff Beneficiary under
Claim #20151001325 policy owned by Peter Meriwether, Jr. Defendant wrongfully
paid two claimants falsely fil[ing] fraudulent claims, two-thirds of the policy
benefits. The insurance company through negligence and bad faith paid claimants
who were not children of the deceased.
(Id.) The warrant seeks recovery on these claims and a reasonable attorney’s fee in an amount
“under $50,000.00 Dollars.” (Id.) Although the complaint provides no further detail, later filings
show that Meriwether challenges MetLife’s equal division of Peter Meriwether’s death benefits
among herself, Ciera Holman, and Angeline Hughes—each of whom claims to be Peter
Meriwether’s daughter. (Doc. No. 16.) Meriwether asserts that she is Peter Meriwether’s only heir,
that the full amount of his policy should have been paid to her, and that MetLife was negligent in
failing to require birth certificates or other documentation from Holman and Hughes before paying
their claims. (Id.)
MetLife removed the action to this Court on September 8, 2016, asserting federal question
jurisdiction over Meriwether’s claim under 28 U.S.C. § 1331. (Doc. No. 1, PageID# 2.) In its notice
of removal, MetLife argues that federal jurisdiction exists because “[t]he subject life insurance
policy was provided pursuant to the Federal Employees Group Life Insurance Act” (FEGLIA);
“[f]ederal law governs the payment of life insurance benefits and the order of precedence under
FEGLIA [(citing 5 U.S.C. § 8705)]”; “FEGLIA life insurance benefits are administered and
adjudicated by MetLife’s Office of Federal Employees Group Life Insurance pursuant to a contract
between the United States Office of Personnel Management and MetLife”; and “[d]istrict courts
of the United States have original jurisdiction over civil actions or claims arising under FEGLIA
[(citing 5 U.S.C. § 8715)].” (Id.)
MetLife answered Meriwether’s complaint on September 15, 2016, and asserted a
counterclaim against Meriwether and a third-party complaint against Holman and Hughes. (Doc.
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No. 6.) MetLife claims that, in the absence of a designated beneficiary and without knowledge of
any competing claims, it paid Peter Meriwether’s benefits in good faith and in accordance with the
order of precedence determined by FEGLIA. (Id.) To the extent Meriwether may be determined
to be the only proper beneficiary of Peter Meriwether’s policy, MetLife seeks a setoff in the
amounts it paid to Holman and Hughes. (Id.)
The parties litigated this case through discovery and completed briefing on MetLife’s
motion for summary judgment. (Doc. Nos. 21–24, 28–32, 34.) On February 21, 2017, the case was
transferred to the undersigned magistrate judge for all further proceedings by the consent of all
parties. (Doc. Nos. 36, 37.) The Court subsequently raised, sua sponte, its concern over the
propriety of the removal in light of the lack of any apparent grounds for federal jurisdiction in
Meriwether’s complaint. (Doc. No. 40.) The Court directed MetLife, as the removing party, to
show cause why the Court has jurisdiction over the action and invited any other party to respond
to MetLife’s position. (Id.) On November 6, 2017, MetLife responded to the Court’s show cause
order. (Doc. No. 41.) No other party addressed the jurisdiction issue.
The Court finds that it does not have jurisdiction to consider this case further and will order
its remand to state court.
II.
Legal Standard
Under 28 U.S.C. § 1441, “any civil action brought in a State court of which the district
courts of the United States have original jurisdiction, may be removed by the defendant or the
defendants, to the district court of the United States for the district and division embracing the
place where such action is pending.” 28 U.S.C. § 1441(a). District courts have federal question
jurisdiction over “all civil actions arising under the Constitution, laws, or treaties of the United
States.” 28 U.S.C. § 1331. A matter “arises under” federal law if “a well-pleaded complaint
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establishes either that federal law creates the cause of action or that the plaintiff’s right to relief
necessarily depends on resolution of a substantial question of federal law.” Empire Healthchoice
Assurance v. McVeigh, 547 U.S. 677, 690 (2006) (quoting Franchise Tax Bd. v. Constr. Laborers
Vacation Tr. for S. Cal., 463 U.S. 1, 27–28 (1983)). Just as is required of cases initially filed in
federal court, the federal right “must be an element, and an essential one, of the plaintiff’s cause
of action.” Phillips Petroleum Co. v. Texaco, Inc., 415 U.S. 125, 128 (1974). It must be found
“upon the face of the complaint, unaided by the answer” and cannot be anticipated in a probable
defense. Id.
Allowing removal of state law claims that implicate federal issues “captures the
commonsense notion that a federal court ought to be able to hear claims recognized under state
law that nonetheless turn on substantial questions of federal law, and thus justify resort to the
experience, solicitude, and hope of uniformity that a federal forum offers on federal issues.”
Grable & Sons Metal Prod., Inc. v. Darue Eng’g & Mfg., 545 U.S. 308, 310 (2005). However,
“[t]he removal jurisdiction of the federal courts is to be ‘scrupulously confined.’” Nixon v. James,
174 F. Supp. 2d 739, 742 (M.D. Tenn. 2001) (quoting Shamrock Oil & Gas Corp. v. Sheets, 313
U.S. 100, 109 (1941)). Cases removed from state court must be scrutinized for “any disruptive
portent” of the exercise of federal jurisdiction to the balance between state and federal authority.
Grable, 545 U.S. at 313–14. This creates a “strict policy” against retaining federal jurisdiction
when to do so would threaten “the sovereignty of state governments and state judicial power.”
Nixon, 174 F. Supp. 2d at 742.
III.
Analysis
The first steps of determining whether Meriwether’s claims “arise under” federal law are
easily resolved. The warrant filed in state court does not invoke a federal cause of action; it alleges
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only that MetLife breached an insurance contract by negligently and in bad faith paying policy
proceeds to two claimants who fraudulently claimed to be children of the insured. (Doc. No. 1-1,
PageID# 4.) MetLife argues that 5 U.S.C. § 8715 confers on federal district courts “original
jurisdiction . . . of a civil action . . . founded on [FEGLIA].” (Doc. No. 41, PageID# 506.) But
MetLife omits critical words from the statute, which reads in full: “The district courts of the United
States shall have original jurisdiction, concurrent with the United States Court of Federal Claims,
of a civil action or claim against the United States founded on this chapter.” 5 U.S.C. § 8715
(emphasis added). The United States is not a party to this action; thus, the statute does not establish
federal jurisdiction in this case.
This Court’s jurisdiction depends, therefore, on whether Meriwether’s right to relief as
claimed in her complaint otherwise “necessarily depends” on resolving an issue of federal law.
Empire, 547 U.S. at 690. To meet this standard, MetLife must show that Meriwether’s claims raise
“not only a contested federal issue, but a substantial one, indicating a serious federal interest in
claiming the advantages thought to be inherent in a federal forum.” Grable & Sons Metal Prod.
Inc. v. Darue Eng’g & Mfg., 545 U.S. 308, 313 (2005).
MetLife first argues that Meriwether’s right to relief necessarily depends on resolving the
question of whether Meriwether is the only “child” of her father or whether Hughes and Holman
are also his “children” as those terms are defined in FEGLIA and its regulations. (Doc. No. 41,
PageID# 506–08.) MetLife is correct that FEGLIA and its regulations establish the order of
precedence for payment of benefits and define the statute’s relevant terms. See 5 U.S.C. § 8705(a);
5 C.F.R. § 870.101 (defining “child” under FEGLIA as “a legitimate child, an adopted child, or a
recognized natural child, of any age”). However, the claims raised in Meriwether’s complaint do
not turn on the application or interpretation of those statutory or regulatory provisions. Instead,
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Meriwether challenges MetLife’s “negligence and bad faith [in paying] claimants who were not
children of the deceased.” (Doc. No. 1-1.) Thus, “[w]hile Plaintiff’s claim might well implicate §
8705, it does not necessarily raise a federal issue, and might instead turn on other conduct not
addressed by the statute.” Victoria v. Metro. Life Ins. Co., No. C 09-04179 CRB, 2010 WL 583946,
at *2 (N.D. Cal. Feb. 16, 2010).
The Court need look no further for confirmation that this case does turn on issues other
than FEGLIA’s application than MetLife’s arguments in favor of summary judgment, which rely
solely on Tennessee law. (Doc. No. 22.) Although MetLife argues in response to the Court’s showcause order that Meriwether’s claims will depend on the definition of “child” under FEGLIA (Doc.
No. 41, PageID# 506–06), its summary judgment briefing directs the Court to Tennessee’s statute
defining the circumstances under which a man is presumed to be a child’s father (Doc. No. 22,
PageID# 334) (citing Tenn. Code Ann. § 36-2-304(a)). Further, MetLife argues for the application
of Tennessee law to determine its duties as relevant to Meriwether’s bad faith and negligence
claims. (Id. at PageID# 331) (arguing that the Court should apply the rule of Atkins v. Security
Conn. Life Ins. Co., No. 02A01-9710-CV-00257, 1998 WL 900057 (Tenn. Ct. App. Dec. 28,
1998), establishing a good faith payment defense under Tennessee law).
Thus, while federal law provides the framework within which the subject insurance policy
was issued and administered, Meriwether’s claims raise state law issues. As many other courts
have found in similar circumstances, “it is not clear ‘why a proper federal-state balance’ would
place this case in federal court.” Victoria, 2010 WL 583946 at *3 (remanding action in which
plaintiff claimed breach of the covenant of good faith and fair dealing in distribution of FEGLIA
benefits); see also Parker v. Metro. Life Ins. Co., 264 F. Supp. 2d 364, 366 (D.S.C. 2003) (granting
motion to remand because “[t]he real issues in this case are whether MetLife was negligent in
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paying or whether Maxwell fraudulently obtained the FEGLI proceeds” under state law); Kittner
v. Metro. Life Ins. Co., No. 01-CV-0146E(SR), 2001 WL 388754, at *2 (W.D.N.Y. Apr. 13, 2001)
(“Although federal statutes and regulations may ultimately be looked to at some point in this
litigation, plaintiff’s action, at its core, requires only an interpretation of the FEGLIA policy and
such interpretation is guided by state law.”). Because this case does not necessarily depend on the
resolution of any contested and substantial issue of federal law, it is properly heard in state court.
See Grable & Sons, 545 U.S. at 313.
MetLife’s other arguments do not change this result. MetLife argues that federal
jurisdiction exists because Meriwether’s state law claims are preempted by FEGLIA. Specifically,
MetLife contends that, “[b]y attempting to rely on state law for her position, Plaintiff seeks to
recover damages and to impose a duty to investigate that conflict with and go beyond that which
is required by FEGLIA, its regulations, and the FEGLI contract[.]” (Doc. No. 41, PageID# 508–
09.) First, it is well-established that “a case may not be removed to federal court on the basis of a
federal defense, including the defense of pre-emption, even if the defense is anticipated in the
plaintiff’s complaint . . . .” Caterpillar, Inc. v. Williams, 482 U.S. 386, 393 (1987). The only
exception to this rule is the complete preemption doctrine, which applies when a statute’s
“extraordinary” preemptive force covers an entire area of state law and “converts an ordinary state
common-law complaint into one stating a federal claim for purpose of the well-pleaded complaint
rule.” Id.
But FEGLIA’s preemption clause applies only to the extent that state law is inconsistent
with the federal statute. 5 U.S.C. § 8709(d) (establishing preemption of state law by the statute “to
the extent that the law or regulation is inconsistent with the contractual provisions”). Compare
Kittner, 2001 WL 388754 at*2 (finding no preemption in case where “obligations to perform
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[under FEGLIA policy were] ‘a creation of the state’”) (quoting Gully v. First Nat’l Bank, 299
U.S. 109 155 (1936)), with Hajdu v. Metro. Life Ins. Co., Civil Action No. 15-195, 2015 WL
2106129, *6–7 (W.D. Pa. May 6, 2015) (finding in the context of a motion to dismiss that
Pennsylvania statute establishing bad faith conflicts with, and is therefore preempted by,
FEGLIA). Because FEGLIA’s preemption is not complete, it does not provide a basis for removal
of Meriwether’s claims. Moreover, MetLife has not established that FEGLIA’s limited preemption
clause would apply in this case. Although MetLife alludes to a discrepancy between the duties
imposed on an insurer by state law and FEGLIA, it does not identify any conflicting provisions of
state and federal law and, again, argues elsewhere that Tennessee law should apply to Meriwether’s
claims.
Finally, MetLife asserts that federal interests are heightened in this case because the United
States subsidizes the life insurance policies available to its employees under FEGLIA. (Doc. No.
41, PageID# 511.) Although such fiscal assistance may increase the federal interest in FEGLIA
administration, see Metro. Life Ins. Co. v. Browning, 839 F. Supp. 1508, 1514 (W.D. Okla. 1993)
(citing cases), it does not tip the balance in favor of federal jurisdiction, especially in cases like
this one where the issues arise between private parties. Cf. Empire, 547 U.S. at 683–84 (finding
no federal question jurisdiction in suit concerning federal employee health insurance for which
“the Federal Government pays about 75% of the premiums”). See also Yorkshire Commons Ltd.
Dividend Hous. Ass’n Ltd. P’ship v. City of Mount Pleasant, No. 12-13468, 2012 WL 13002174,
at *6 (E.D. Mich. Dec. 6, 2012) (noting that “Empire Healthchoice instructs that when a case
centers [on] the actions of private parties and the allocation of funds between them (rather than the
federal government), the case does not involve a substantial federal question”). MetLife’s
argument that it does is simply too broad. Under its terms, “all disputes involving the payment of
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death benefits would implicate FEGLIA, and thus all of those cases, with their potentially small
damage amounts and state law claims, would land in federal court.” Victoria, 2010 WL 583946 at
*3. As the court found in Victoria, “[t]his is to be avoided, if possible.” Id.
“[I]t takes more than a federal element ‘to open the ‘arising under’ door.’” Empire, 547
U.S. at 701 (quoting Grable & Sons, 545 U.S. at 313). Here, Meriwether raises traditional state
law claims of negligence and bad faith that will be resolved under Tennessee authority. Without
clear identification of a necessary, contested, and substantial federal issue, the door to this court
remains closed.
IV.
Conclusion
The Court finds that it lacks jurisdiction to consider this action further and hereby
REMANDS it to the Metropolitan General Sessions Court of Davidson County, Tennessee. All
other pending motions are DENIED AS MOOT. The Clerk is directed to close the file.
It is so ORDERED.
____________________________________
ALISTAIR E. NEWBERN
United States Magistrate Judge
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