Slater v. Southwest Research Institute
ORDER DENYING 7 Plaintiff's Motion to Remand to State Court. The Court concludes that Plaintiffs claim is completely preempted by ERISA, that subject matter jurisdiction exists, and that Plaintiffs motion for remand to the state court must be denied. Signed by Judge Xavier Rodriguez. (kh)
In the United States District Court
Western District of Texas
Southwest Research Institute and
Southwest Research Medical Trust Plan
On this day came on to be considered Plaintiff’s motion to remand (docket no. 7). The
motion is denied.
Plaintiff filed this case in the 288th Judicial District Court of Bexar County, Texas. In the
Original Petition, Plaintiff alleges that David C. Slater, Ph.D. was employed as a scientist at
Southwest Research Institute (SWR). In May 2007, he underwent surgery necessary to treat a
brain tumor. On September 25, 2007, through his employer’s Medical Trust Plan, he increased
his life insurance plan by adding a $500,000 plan.
On or about October 28, 2008, Dr. Slater’s treating oncologist wrote to SWR describing
certain accommodations that Dr. Slater would require returning to work.1 On November 20,
2008, Dr. Slater participated in an open enrollment in his employer’s benefit plan. He increased
his accidental death and disability benefit from $100,000 to $200,000, but he decreased his life
In Dr. Fichtel’s October 28, 2008 letter she states Dr. Slater “wishes to return to work fulltime … and I believe he
is capable of doing so with minimal accommodations. Mr. Slater has developed short-term memory loss during the
course of his illness. This has been evaluated, and his long-term memory has not been shown to be adversely
affected. Due to his short-term memory problem, it is recommended that, initially, he not begin new projects;
however, he should have no difficulty resuming work on existing projects, in a group setting, and with which he is
insurance plan benefit from $500,000 to $100,000. According to the original petition, the
“submission and approval were done by Dr. Slater with no oversight by anyone else.”
On or about November 12, 2009, Plaintiff Susan Slater, Dr. Slater’s spouse, became
aware that the life insurance benefit was decreased in 2008. SWR and Mrs. Slater thereafter
approached the insurance carrier, Sun Life, but Sun Life refused to reinstate the $500,000
On July 7, 2010, SWR changed insurance carriers from Sun Life to Hartford. Dr. Slater
died on May 30, 2011.
In the Original Petition Plaintiff alleges that SWR and the SWR Plan committed fraud
because they represented to Plaintiff that they acknowledged the October 28, 2008 instructions
given by the oncologist, but they in fact did not closely supervise Dr. Slater and permitted him
access to changing his insurance policies.2
On December 21, 2012, Defendants removed this case claiming a federal question had
been raised because Plaintiff’s claim is preempted by the Employee Retirement Income Security
Act, 29 U.S.C. §§ 1001, et. seq.
Plaintiff argues that removal was improper because no federal question was pled in the
original petition and the fraud claim is not preempted by ERISA. Plaintiff argues that Mrs.
Slater is not suing for benefits under the SWR plan, she makes “no claim for benefits from an
employee benefit plan,” the issue is SWR’s “unconscionable conduct” not the life insurance
benefit, and the “terms of the life insurance policy is relevant only to the extent that it is the
starting point for calculation of damages.”
The original petition does not provide any details as to who made the alleged misrepresentations and whether Dr.
Fichtel’s October 28, 2008 letter is the sole basis for the claim.
With regard to whether a claim is removable to federal court there are two concepts under
ERISA that are relevant – “conflict preemption” under 29 U.S.C. § 1144 (section 514) and
“complete preemption” under
29 U.S.C. § 1132(a) (section 502(a)).
Felix v. Lucent
Technologies, Inc., 387 F.3d 1146, 1155 (10th Cir. 2004). ERISA preemption under § 514 is not
sufficient for removal jurisdiction. Id. In this case Defendants argue that Plaintiff’s claim is
completely preempted under 29 U.S.C. § 1132(a).
“ERISA's preemption of state law claims is extensive.” McNeil v. Time Ins. Co., 205
F.3d 179, 191 (5th Cir. 2000).
The Fifth Circuit has stated that ERISA “preempts a state law
claim if that claim addresses an area of exclusive federal concern, such as the right to receive
benefits under the terms of an ERISA plan, and if that claim directly affects the relationship
between traditional ERISA entities.” Id.
In determining whether federal jurisdiction exists, this Court applies the well-pleaded
complaint rule, which requires that we look to the face of the complaint rather than to defenses,
for the existence of a federal question. Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987).
Although generally a case may not be removed on the basis of a federal defense, id. at 393, an
exception exists in cases of “complete preemption,” where Congress so “completely pre-empt[s]
a particular area that any civil complaint ... is necessarily federal in character.” Metro. Life Ins.
Co. v. Taylor, 481 U.S. 58, 63–64 (1987). As ERISA claims are completely preempted, see id. at
64–67, state law claims that seek relief available under ERISA are recharacterized as ERISA
claims and arise under federal law. Kemp v. IBM Corp., 109 F.3d 708, 712 (11th Cir. 1997).
The Court considers four elements when deciding whether state law claims are
completely preempted: (1) there must be a relevant ERISA plan; (2) the plaintiff must have
standing to sue under that plan; (3) the defendant must be an ERISA entity; and (4) the complaint
must seek compensatory relief akin to that available under § 1132(a), which is normally a claim
for benefits under the plan. Ervast v. Flexible Prods. Co., 346 F.3d 1007, 1012–13 (11th Cir.
Plaintiff does not dispute that SWR had an ERISA plan that provided life insurance
benefits. No one contests that as the surviving spouse and beneficiary, Mrs. Slater has standing.
No one disputes that SWR was Dr. Slater’s employer and that it had implemented the SWR
Employees’ Insurance Program Plan. In this case the fourth factor dictates that Plaintiff’s claim
is completely preempted.
When Dr. Slater utilized his employer’s electronic open enrollment system he was
provided a summary of his elections before submission.
A certification at the top of the
summary notified the employee of ERISA’s applicability. On or about January 23, 2010, after
Dr. Slater became aware of the decreased life insurance benefit, he submitted an evidence of
insurability form to Sun Life, in an attempt to increase the benefit to $500,000. On March 17,
2010, Sun Life denied his request due to his medical history. The Slaters exercised their right to
an ERISA review.
In this case although Plaintiff argues she is making “no claim for benefits from an
employee benefit plan,” the reality is that she is seeking the $500,000 insurance benefit as her
underlying claim. “Section 502, by providing a civil enforcement cause of action, completely
preempts any state cause of action seeking the same relief, regardless of how artfully pleaded as
a state action.” McGowin v. ManPower Intern., Inc., 363 F.3d 556, 558 (5th Cir. 2004). If a
plaintiff “could have brought her claim under ERISA, the cause of action is completely
preempted and provides a basis for federal jurisdiction.” Id.
The Court concludes that Plaintiff’s claim is completely preempted by ERISA, that
subject matter jurisdiction exists, and that Plaintiff’s motion for remand to the state court must be
SIGNED this 19th day of March, 2013.
UNITED STATES DISTRICT JUDGE
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