finding that ERISA did not preempt claims of fraud, misrepresentation and promissory estoppel, reasoning that “preemption should apply to a state law claim only if Congress has provided a remedy for the wrong or wrongs asserted”
How later courts described this case
- finding that ERISA did not preempt claims of fraud, misrepresentation and promissory estoppel, reasoning that “preemption should apply to a state law claim only if Congress has provided a remedy for the wrong or wrongs asserted”
- discussing Provience v. Valley Clerks Trust Fund, 509 F.Supp. 388 (E.D. Cal. 1981) (observing that important areas of state concern with only indirect effects on ERISA plans should not be preempted); Miller v. Lay Trucking Co., 606 F.Supp. 1326 (N.D. Ind. 1985) (declining to preempt when fraud occurred before plan was created and only indirectly affected plan); Childers v. Northwest Airlines, Inc., 688 F.Supp. 1357 (D. Minn. 1988) (rejecting time-based argument); Mid America Hotel Corp. v. Bernstein, 664 F.Supp. 384 (N.D. Ill. 1987) (same)
- basing its decision on the Eighth Circuit decision in Dependahl v. Falstaff Brewing Corp., 653 F.2d 1208 (8th Cir.1981), which held that preemption is appropriate where Congress has occupied the entire field and has provided a remedy for the asserted wrong
- concluding claim of breach of fiduciary duty was preempted where plaintiffs alleged employer fraudulently induced participation in a newly established benefit plan because ERISA provided a specific remedy for such a claim.
Written by the judges who cited it.
Distinguished
Distinguished by Cole v. Health Care Corp., 811 F. Supp. 1229 (1993)
Perry is distinguishable from the case at bar because the plaintiffs in Perry were not seeking recovery of an ERISA plan benefit.
The opinion
DAVID A. NELSON, Circuit Judge,
concurring in part and dissenting in part.
If the plaintiffs’ claims of fraud, misrepresentation, and promissory estoppel have not been preempted under ERISA — and I agree with the court’s resolution of that *163 close question — it does not seem to me that the remaining claims (breach of fiduciary duty and lack of consideration) can fairly be said to have been preempted either.
The source of the fiduciary duty to which the employer was alleged to have been subject is unrelated to the benefit plan. The amended complaint alleges simply that “a fiduciary duty to fairly, openly and honestly disclose pertinent and material facts” arose because the plaintiffs, as the defendant is claimed to have known, “were in an inherently unequal bargaining position with defendant,” and the plaintiffs “had placed trust and confidence in Defendant to act fairly and in good faith toward Plaintiffs.” The supposed fiduciary duty thus has nothing to do with the administration of the plan or the payment of benefits under it — and I cannot see that the alleged duty to make full disclosure is any more closely related to the plan than is the duty not to make affirmative misrepresentations. If the alleged violation of the latter duty is not covered by ERISA, I do not understand why the alleged violation of the former is.
Turning to the supposed lack of consideration, I have no doubt that the claim would have been preempted had the plaintiffs asserted that they failed to receive the shares of stock promised them under the plan. As I read the amended complaint, however, that is not what the plaintiffs are contending. The plaintiffs do not deny that they have been earning stock in the company on a daily basis, and the defendant’s affidavit shows they have been; it is “uncontrovert-ed,” as the magistrate noted, that the plaintiffs have been credited with stock ownership consistent with their pledges. The lack of consideration claim makes no sense to me, but if the plaintiffs are not contending that they failed to receive the stock to which the benefit plan entitles them, I do not think the claim is covered by ERISA.
I would affirm the judgment of the district court on all counts.