# Retirees of the Goodyear Tire & Rubber Co. Employee Healthcare Trust Committee v. Steely

> District Court, N.D. Ohio · February 21, 2020

URL: https://www.frixlaw.com/law-library/cases/10368036

## Case

- **Court:** District Court, N.D. Ohio
- **Decided:** February 21, 2020
- **Opinion:** 100trialcourt
- **Cited by:** 0 later opinions in the Frix Law Library

## Citator (automated)

- No negative treatment found by the automated citator. That is not the same as a confirmation that the case is good law; read the citing cases.
- Full citator and citing cases: https://www.frixlaw.com/law-library/cases/10368036

## How later opinions describe it (automated extraction)

- explaining that the “catchall” recusal provision added to 28 U.S.C. § 455 in 1974 requires an interpretation that “what matters is not the reality of bias or prejudice but its appearance[]”

## Opinion text

UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF OHIO
EASTERN DIVISION

THE RETIREES OF THE GOODYEAR ) CASE NO. 5:19-cv-1893
TIRE & RUBBER CO. EMPLOYEE )
HEALTHCARE TRUST COMMITTEE, )
)
PLAINTIFF, ) JUDGE SARA LIOI
)
vs. ) MEMORANDUM OPINION
) AND ORDER
PAMELA STEELY, et al., )
)
DEFENDANTS. )

Before the Court is plaintiff’s motion to amend the judgment under Fed. R. Civ. P. 59(e).
(Doc. No. 15–16 [“Mot.”]). Defendants filed a response in opposition (Doc. No. 18 [“Opp’n”]1)
and plaintiff filed a reply (Doc. No. 19 [“Reply”]). As set forth herein, the motion is granted.

I. MOTION UNDER FED. R. CIV. P. 59(e) (Doc. No. 15)
On December 31, 2019, this Court issued a Memorandum Opinion and Judgment Entry
(Doc. Nos. 11, 12) dismissing this case without prejudice, under Fed. R. Civ. P. 12(b)(1), for lack
of subject matter jurisdiction. The Court determined that plaintiff could not establish that this
lawsuit addresses an ERISA plan and, therefore, there was no subject matter jurisdiction to pursue
an ERISA claim.
On January 27, 2020, plaintiff timely filed its motion under Rule 59(e). Rule 59 relief may
be granted based on “(1) a clear error of law; (2) newly discovered evidence; (3) an intervening

1 In their opposition brief, defendants request that the Court “issue Rule 11 sanctions, award [them] fees and expenses
and grant any and all other relief the Court deems appropriate.” (Opp’n at 447 (all page number references herein are
to the page ID number generated by the court’s electronic docketing system).) To the extent it can be construed as a
motion, this request is denied.
change in controlling law; or (4) a need to prevent manifest injustice.” Intera Corp. v. Henderson,
428 F.3d 605, 620 (6th Cir. 2005). Plaintiff seeks to amend “by vacating th[e] Judgment to correct
clear errors of law and to prevent a manifest injustice.” (Mot. at 254.)
In support of its motion, plaintiff relies upon Daft v. Advest, Inc., 658 F.3d 583 (6th Cir.
2011), which plaintiff inexplicably failed to cite in its opposition to defendants’ Rule 12(b)(1)

motion to dismiss, and which the Court’s own research at the time did not reveal. Nonetheless, this
Court cannot now ignore the holding in Daft, where the court of appeals was confronted with the
question of whether the existence of an ERISA plan was jurisdictional, and found:
[R]ecent Supreme Court precedent has abrogated the conclusion, assumed in our
previous cases and explicitly adopted in the majority of our sister circuits, that the
existence of an ERISA plan is a prerequisite to federal subject-matter jurisdiction.

Id. at 589 (citing Arbaugh v. Y & H Corp., 546 U.S. 500, 126 S. Ct. 1235, 163 L. Ed. 2d 1097
(2006)).2 The court held that, “in light of Arbaugh and its progeny, the existence of an ERISA plan
must be considered an element of a plaintiff’s claim under Section 502(a)(1)(B), not a prerequisite
for federal jurisdiction.” Id. at 590–91. “Because the existence of an ERISA plan is not a
jurisdictional prerequisite, federal subject-matter jurisdiction lies over [p]laintiffs’ suit as long as
they raise a colorable claim under ERISA.” Id. at 593.
The complaint here alleges, inter alia, that the action is brought to enforce the terms and
preserve the assets of an employee welfare benefit plan under the terms of ERISA (Doc. No. 1,
Complaint [“Compl.”] ¶ 1); that plaintiff serves as the plan sponsor and named fiduciary (id. ¶ 4);
that defendant Pamela Steely was a participant in the plan (id. ¶ 10); that Steely sustained personal
injuries in an accident (id. ¶ 11); that the plan paid various medical benefits on Steely’s behalf in

2 In their opposition brief, defendants offer no discussion regarding the holding in Daft.
2
the amount of $434,688.45 (id. ¶ 12); that the plan contains a provision requiring reimbursement
from settlement proceeds (id. ¶ 13); that Steely settled her personal injury claim for $439,500.00
(id. ¶ 15); and that Steely and her personal injury attorneys, defendant Eshelman Legal Group,
have refused to reimburse the plan from the proceeds of the settlement funds (id. ¶ 22). These
allegations raise a colorable claim under ERISA, and defendants have not argued otherwise.3

In light of the holding in Daft, the Court concludes that it was an error of law to dismiss
this case on the basis of lack of subject matter jurisdiction.4 Plaintiff moves the Court to vacate its
earlier decision and to “enter a non-final order denying the [d]efendants’ motion to dismiss and
allowing the case to proceed to a decision on the merits.” (Mot. at 254.) The Court agrees that this
is the best course of action, given both the Court’s original erroneous decision under Rule 12(b)(1)
and defendants’ failure to sufficiently argue under Rule 12(b)(6) in their motion to dismiss.
Therefore, the Court hereby vacates the Memorandum Opinion (Doc. No. 11) and
Judgment Entry (Doc. No. 12), denies defendants’ motion to dismiss (Doc. No. 6), and directs the
clerk to reopen this case.

That, however, does not end the analysis. The majority of plaintiff’s argument in its Rule
59(e) motion goes to the merits of the fundamental question of whether the plan at issue is a true
ERISA plan. To that extent, plaintiff’s motion is seeking reconsideration—arguing that, in answer
to this fundamental question, the Court committed legal error by concluding that the plan was not

3 Defendants styled their original motion to dismiss as one brought under both Rule 12(b)(1) and Rule 12(b)(6), but
included no separate argument addressing the latter. Therefore, this Court construed the motion as seeking dismissal
only for lack of subject matter jurisdiction, not for failure to state a claim. (See Doc. No. 11, Memorandum Opinion
at 227 n.1.) In light of these allegations raising a colorable ERISA claim, the complaint would have survived a
properly-argued Rule 12(b)(6) motion.
4 Having accepted the argument that there was a legal error requiring that the judgment be vacated, the Court need not
address plaintiff’s additional argument that such action will also prevent manifest injustice.

3
an ERISA plan. The Court need not address this question now and, given that it has denied
defendants’ motion to dismiss, the question will remain for another day.
That said, although the original memorandum opinion and judgment must be set aside due
to the holding in Daft, the Court cannot ignore that it has already made a determination that the
case does not involve a proper ERISA plan. Arguably, the parties might fairly expect the Court to

issue virtually the same order at such time as the issue becomes ripe for determination. For this
reason, the Court will also examine whether there is any need to recuse upon the reopening of the
case.
Recusal is generally required “only if a reasonable person with knowledge of all the facts
would conclude that the judge’s impartiality might reasonably be questioned.” Wheeler v.
Southerland Corp., 875 F.2d 1246, 1251 (6th Cir. 1989) (quotation marks and citation omitted).
“This standard is objective[,]” id. (emphasis omitted) (quoting Browning v. Foltz, 837 F.2d 276,
279 (6th Cir. 1988)), and is not generally demonstrated merely from the “judge’s view of the law,
which may have been expressed . . . in some prior case.” Knapp v. Kinsey, 232 F.2d 458, 466 (6th

Cir. 1956) (citations omitted). That said, “a judge is obliged to disqualify [her]self where there is
a close question concerning [her] impartiality[.]” United States v. Angelus, 258 F. App’x 840, 842
(6th Cir. 2007) (citation omitted).
Here, in a detailed legal opinion following full briefing on defendants’ motion to dismiss,
this Court determined that, under its view of the relevant law, the plan at issue is not an ERISA
plan. Even though that decision is now being properly vacated under the holding in Daft, the Court
believes that recusal is prudent because, during the briefing on the motion to dismiss, the parties
already largely briefed—and the Court already ruled upon—the ultimate issue in the case.
Although the now-vacated decision alone does not demonstrate any sort of bias or partiality on the
4
part of the undersigned, it might cause the appearance, upon reopening, that this presiding judicial
officer has predetermined the case. See Liteky v. United States, 510 U.S. 540, 547–48, 114 S. Ct.
1147, 127 L. Ed. 2d 474 (1994) (explaining that the “catchall” recusal provision added to 28 U.S.C.
§ 455 in 1974 requires an interpretation that “what matters is not the reality of bias or prejudice
but its appearance[]”).

Under these specific circumstances, and to give the parties the fair benefit of fresh eyes,
the Court believes recusal is the appropriate route.5

II. CONCLUSION
For the reasons set forth herein, plaintiff’s motion (Doc. No. 15) under Fed. R. Civ. P. 59(e)
to vacate the previous Memorandum Opinion (Doc. No. 11) and Judgment Entry (Doc. No. 12) is
granted. The Memorandum Opinion and Judgment entry are vacated and shall be stricken from
the record.
The Clerk is directed to reopen this case effective as of the date of the instant Memorandum

Opinion and Order. Defendants’ now revived motion to dismiss (Doc. No. 6) is denied.

5 The Court notes once again, as it did in footnote 3 of the now-vacated memorandum opinion, that, from the outset,
it believed this case should have been assigned to the original district judge who approved the settlement agreement
that established the plan at issue. See Redington, et al. v. The Goodyear Tire & Rubber Co., 5:07-cv-1999-JRA. That
Settlement Agreement stated that “[t]he Court will, subject to Section 9 [dealing with Dispute Resolution], retain
exclusive jurisdiction to resolve any disputes relating to or arising out of or in connection with the enforcement,
interpretation or implementation of this Settlement Agreement.”
5
Finally, for the reasons given, the undersigned recuses herself under 28 U.S.C. § 455(a)
and returns this case to the Clerk to assign a different judicial officer.®

IT IS SO ORDERED.
Dated: February 21, 2020 □□ “
HONORABLE SARA LIOI
UNITED STATES DISTRICT JUDGE

® Also before the Court is a motion filed by non-party National Coordinating Committee for Multiemployer Plans
(“NCCMP”) for leave to file an amicus curiae brief. (Doc. No. 17.) Given the Court’s recusal, it declines to rule on
that motion and leaves it to the discretion of the judicial officer who will be newly assigned to the case.

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Source: Frix Law Library, https://www.frixlaw.com/law-library/cases/10368036. Public record. Not legal advice.