Opposition Brief — Anderson v. Electronic Data Systems Corp.
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OFFICE OF THE CLERK
No. 93-1670
In The
Supreme Court of the United States
October Term, 1993
4
GEORGE RAYMOND ANDERSON,
Petitioner
¥.
ELECTRONIC DATA SYSTEMS CORP.,
DOUGLAS M. CROW,
ANTHONY E. WEYNAND,
RICHARD P. SHLAKMAN,
and DARRELL JOHNSON,
Respondents.
On Petition For Writ Of Certiorari
To The United States Court Of Appeals
For The Fifth Circuit
,%
+.
BRIEF IN OPPOSITION
TO PETITION FOR WRIT OF CERTIORARI
PHILLIP N. SMITH JR.
Counsel of Record
JEFFREY A. CARTER
MICHAEL ANDREW PIAZZA
McKoo_ SmIrTH, P.C.
300 Crescent Court, Suite 1500
Dallas, Texas 75201
214-978-4000
Counsel for Respondents,
Electronic Data Systems Corporation,
Anthony E. Weynand, Richard P.
Shlakman, and Darrell Johnson
i
QUESTIONS PRESENTED
1. Whether the district court erred in finding that Plaintiff's
state law cause of action for wrongful discharge, which referred to
an employee benefit plan and the Employee Retirement Income
Security Act (“ERISA”), which contained allegations that he
was asked to violate ERISA, and which required the existence of
an ERISA plan to pursue the action, was preempted by ERISA,
either because the action related to an ERISA plan or it con-
flicted with ERISA’s civil enforcement scheme, § 502(a).
2. Whether the district court erred in applying the doctrine
of complete preemption to Plaintiffs wrongful discharge claim
which fell within the scope of ERISA’s civil enforcement scheme,
§ 502(a).
**
RULE 29.1 LIST OF PARENTS AND SUBSIDIARIES
The parent company of respondent Electronic Data Systems
Corporation is General Motors Corporation. The North American
subsidiaries (other than wholly owned subsidiaries) in which
Electronic Data Systems Corporation holds at least a five percent
equity interest are Aristacom International, Inc., The ASK
Group, Inc., Behaviortech, Inc., CAPSCO Software Canada
Ltd., CLS Corporation, Comtrac Corporation, Convergent Cor-
poration, Hitachi Data Systems Holding Corporation, Neodata
Corporation, One Touch Systems, Inc., Soft-Switch, Inc., Spec-
trum Investment Systems Inc., Systems Control Technology Inc.,
Telecommunications Data Services, Incorperated, and Thomas
Group, Inc. International subsidiaries (other than wholly owned
subsidiaries) in which Electronic Data Systems Corporation
holds at least a five percent equity interest are Klockner Datem
Technik GmbH, Aeronautical Systems Designers Limited, COG-
SYS Limited, BSS Belgique, GMB Belgique, Informatique
Proget (Brussels), CLIOR, E.A.I. (Europe Assurance Informa-
tique), F.I.J. (France Informatique Juridique), GESTHELP
HUISSIER, Infosys, OGIP ORGA, PROGICAL, SLIB,
SONIA, TELEMAC, BSS Grece, and EDS Hellas.
TABLE OF CONTENTS
hye Fs 5
RULE 29.1 LIST OF PARENTS AND
secs ccecssccccececees
I. THE FIFTH CIRCUIT FOLLOWED THE
DECISIONS OF THIS COURT AND DID
NOT ERR IN UPHOLDING THE DISTRICT
COURT’S REFUSAL TO REMAND THE
ee pally See he ae ee a
A. Anderson’s Wrongful Discharge Cause Of
Action Was Preempted Because It Relates To
toes gon oy lap decdtssee
B. Anderson’s Wrongful Discharge Claim Was
Preempted Because It Conflicted With ERISA’s
Civil Enforcement Scheme..................
C. Anderson’s Wrongful Discharge Cause Of Action
Was Completely Preempted By ERISA Because
It Was Within The Scope Of ERISA’s Civil
EPOUOONONE BOROMES .. ww. cee cece cece:
~~ UW” WN
Page
Il. IT IS ANDERSON WHO IS NOT
FOLLOWING THE DECISIONS OF
Be EE hr obs Cite ha od needed oéaxd 12
A. State Law Claims Are Subject To Preemption
And Removal Under ERISA................ 12
B. A State Law Claim Is Removable Even If
ERISA Does Not Provide A Remedy For The
Gs: 'o0s Guirao se decnies tana de od 14
C. Complete Preemption May Occur Even If
ERISA Does Not Provide An Action Identical to
the Action Being Preempted Or The Plaintiff Is
Not Seeking Any Relief Under ERISA ....... 16
Ill. ADDITIONAL GROUNDS EXIST TO
SUPPORT THE DECISION OF THE COURT
OF APPEALS UPHOLDING THE DISTRICT
COURT'S REFUSAL
a EE B65 kx ve du kin cs ona xawee vie ee’s 17
A. The District Court Had Removal Jurisdiction
Under The Well-Pleaded Complaint Rule..... 18
B. The District Court Had Original Jurisdiction At
The Time It Entered Judgment For EDS ..... 19
C. Anderson Admitted That The District Court Had
Supplemental Jurisdiction................... 21
ee FE Pe, ee Pe eee PEF Eee yer ae 21
ee
TABLE OF AUTHORITIES
CASES
Page
Alessi v. Raybestos-Manhattan, Inc., 451 U.S. 504,
ci eeeN vader platnressaconsanee 14
American Fire & Casualty Co. v. Finn, 341 U.S. 6,
Pe ee cc eee ey vagd bevels vehast e%é 19
Anderson v. EDS, 11 F.3d 1311 (Sth Cir. 1994)....... 9, 10, 11, 13
Authier v. Ginsberg, 757 F.2d 796 (6th Cir.), cert. denied,
Gre UA es He es Be COPE ee Sea Fic cedecvsvcsees 16
Baris v. Sulpicio Lines, Inc., 932 F.2d 1540 (Sth Cir.),
cert. denied, ____ US. Siva tek 2) ) eee 20
Corcoran v. United Healthcare, Inc., 965 F.2d 1321 (Sth Cir.),
cert. denied, ____ US. =» BOD re Ed COPUED 0 cc ceveee 15
Granfinanciera, S.A. v. Nordberg, 492 U.S. 33,
BR BT RR Se er pe eee 17
In re Digicon Marine, Inc., 966 F.2d 158 (Sth Cir. 1992) ...... 20
District of Columbia v. Greater Washington Board of Trade,
Se caiadied GOO? a EEE bn:4e o's oye bab epen as 7,8
Franchise Tax Board of CA. v. Construction Laborers Vacation
Trust for Southern CA., 463 U.S. 1, 103 S.Ct. 2841 (1983) .. 18
Grubbs v. GECC, 405 U.S. 699, 92 S.Ct. 1344 (1972) ..... 6, 19, 20
Gully v. First Nat'l Bank in Meridian, 299 U.S. 109,
Oe ee Ss acgake tay chads bs br wenaeoedesnnees 18
Hansen v. Continental Ins. Co., 940 F.2d 971 (Sth Cir. 1991) .. 15
Ingersoll-Rand Co. v. McClendon, 498 U.S. 133,
CES Ae Gre LUOeee vecvbwsinss 5, 7, 8, 10, 11, 13, 14, 15, 17
Kidd v. Southwest Airlines, Co., 891 F.2d 540
EE Mat baton cae he dato ehed ee He8e 18, 19
Mackay v. Uinta Development Company, 229 U.S. 173,
ns os his acts o6 rl bes bebecveesiusaes 19
Massachusetts Mutual Life Ins. Co. v. Russell, 473 U.S. 134,
ro Wc b be Gee ealedeaka betes te ceva 15
Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58,
SG? SAA. S568 CEPST) on ce ccvesvees S$, 7, 18, 83, 15, 16, 19, 18
vi
TABLE OF AUTHORITIES - Continued
Page
Nowoc v. Rheem Mfr. Co., 772 F. Supp. 977
Cs SEE nk a ROPERS nhede Vetebey dé cueedctecncads 14
Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41,
Be es ITD Faee bloc bduebiceussecess 7, 8, 10, 15, 17
Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733
Ces SEE ce nkse cates Dead kde bob asekwanenesbarsetsec 9
Shaw v. Delta Air Lines, 463 U.S. 85, 103 S.Ct. 2890 (1983)... 8
In re Shell Oil Co., 932 F.2d 1518 (Sth Cir. 1991),
cert. denied, ____ US. , 112 S.Ct. 914 (1992) ...... 20, 21
Sperling v. Texas Health Enterprises, Inc., 791 F. Supp. 662
Ce es SE ere Wi reed Chad daundeaekn bes édénadses 14
Washington v. Yakima Indian Nation, 439 U.S. 463,
Se Ce EP ci caddies dh bn gdGs ctu eect bebcodsecs cs 17
Whitley v. Albers, 475 U.S. 312, 106 S.Ct. 1078 (1986) ....... 17
Williams v. AC Spark Plugs Div. of General Motors Corp., 985
ae FRR CE 540 6i'tb Sos 0866608 64 0 bods Race oeee 20
Willy v. Coastal Corp., 855 F.2d 1160 (Sth Cir. 1988) ...... 13, 14
STATUTES
ee EE PE ch osie a sv 0-6 06s Chae <> 0 cores budeadiee 4400 4,7
IED ns wate bwiccdeseeeetsds tpeeninead ees 20
ee ti emkd sd Saad anes bieeee ed deeuee thas 10
29 U.S.C. § 1002(7),(8),(21) [ERISA §3].................. 10
29 U.S.C. § 1104(a)(1) [ERISA § 404(a)(1)] .............. 14
29 U.S.C. § 1105(a) [ERISA § 405(a)} ..............2.0.8. 14
29 US.C. § 1109(8) [ERISA § 400(a)) .. 2. cece cc ceees 14
29 U.S.C. § 1132(a) [ERISA § 502(a)]............. 9, 14, 16, 17
BP UAE Oe SN RE 06 bie cccscescucccesvscscces 10
29 U.S.C. § 1144(a) [ERISA § 514(a)]................. 7, 8, 15
Labor Management Relations Act,
G8 UE Sa a a nh oeeeceverccucescneevasee 11, 15
Vil
TABLE OF AUTHORITIES - Continued
Page
MISCELLANEOUS
ROE AG xe rc c bbb evdnencncsteccebiacetneens 4, 20
Brief-in-Chief of Appellant Anderson ........:.............. 2
DUE Ae PED Sec hbd bare needececsccoss 4, 6, 7, 14, 15, 17, 18
Motion for Leave to File Plaintiff's Second
Amended Complaint ........ pideddddecdnvenapenei detest 2
EE due sc dou was dos¥d beccnecépices 1, 4, 7, 18, 21
eS er cecnngees bia bas beh beewe died 1, 2, 3, 4, 14
Petition for a Writ of Certiorari................. 12, 13, 14, 16, 18
Plaintiff's Responses to Douglas M. Crow’s Interrogatories ..... 4
es I dateccseevebervesadeddudnt-s 2, 3
APPENDIX
ER es wine ns ponbasdarecedert cussvvestheresiyes A-l
es he aa ea dkdénadiekenan B-1
Additional Statutory Provisions ....................02.0e0005- C-1
ee ce acs pe badewdawianeseterecni ates D-!
Re ND on oo oc ci delc ccidvedcccecvedeees E-!
[ Filed Separately Under Seal]
ADDITIONAL STATUTES INVOLVED
The statutory provisions listed below are set out in the
Appendix beginning at page C-1.
nt ciceeonnccsouas C4
in endéuvbwhewsbon C-1
LS C-1
| seb eb odens C-2
ee eebevoane ah weet
SR TE TT OOS Ra EO C-4
ee
SAA OR SRR DOs Suid SE Renae AR A tah _ aie thee aA. 2
STATEMENT OF THE CASE
A. Course Of Proceedings And Disposition Of The Case.
Petitioner George Raymond Anderson (“Anderson”) filed
suit on June 26, 1991 in Texas state court against Respondents
Electronic Data Systems Corporation (“EDS”), a Texas corpora-
tion, and four present or former EDS employees, Douglas M.
Crow (“Crow”), Anthony E. Weynand (“Weynand”), Richard
P. Shlakman (“Shlakman”), and Darrell Johnson (“Johnson”),
all Texas residents.’ Anderson alleged that he too was a Texas
resident.”
On July 25, 1991, the Respondents joined in removing the
case to the United States District Court for the Northern District
of Texas, Dallas Division.’ Over four months later, on Decem-
ber 5, 1991, Anderson moved to remand the case back to state
court.’ The district court denied Anderson’s motion.°
Crow obtained a summary judgment in December 1992.° In
April 1993, Anderson filed a second amended complaint in which
he voluntarily dismissed the remaining individual defendants,
Weynand, Shlakman, and Johnson, leaving EDS as the sole
' Plaintiff's Original Petition | 1 dated June 26, 1991 (hereinafter
“Original Petition”) (R. 92-104; A. 1-2). The unsealed portions of the
record are cited in this Brief in Opposition by referring to the page
number of the record as follows: “R. page no.” The sealed portions of
the record are identified by asterisks on the docket sheet and are cited in
this Brief as ““R. Sealed.” Materials in the Appendix are cited as “A, B,
C, D, or E page no.” as appropriate. Appendix E is being filed separately
under seal.
2 Id.
> Notice of Removal (R. 1-5).
* Motion to Remand (R. 299-300; B. 1).
> Order dated January 7, 1992 (R. 331).
®° Memorandum Order dated December 2, 1992 (R. 631).
remaining defendant and dismissed all claims against EDS except
for a claim for wrongful discharge under Texas common law.’ The
district court granted EDS’ motion for summary judgment in
June 1993.8 Anderson appealed to the United States Court of
Appeals for the Fifth Circuit to challenge the district court’s
denial of his motion to remand. He did not, however, raise any
issue on appeal with respect to the district court’s summary
judgment rulings.’
B. Statement Of Facts.
Anderson joined EDS in October 1984.'° According to
Anderson, he became the “Manager of Investments and Debts”
in EDS’ Domestic Treasury Department in 1985, and as such, he
was responsible for all domestic investments made on behalf of
” Second Amended Complaint (R. 672-679). In his motion for
leave to file the Second Amended Complaint, Anderson expressly asked
for leave to dismiss his claims against each of the individual defendants.
Motion for Leave to File Plaintiff's Second Amended Complaint p. 2,
dated March 5, 1993 (R. 647).
Weynand, Shlakman, and Johnson moved to dismiss Anderson’s
appeal against them. The Fifth Circuit did not rule on their motion. By
joining in this Brief in Opposition, Weynand, Shlakman, and Johnson do
not intend to waive or forego, and want to preserve, any rights they may
have to the dismissal of Anderson’s appeal against them.
* Judgment dated June 4, 1993 (R. 709); Memorandum Order
dated June 4, 1993 (R. 701).
* Brief-in-Chief of the Appellant, George Raymond Anderson,
Anderson v. EDS, No. 93-1606 (Sth Cir.) (hereinafter “Appellant’s
Brief”).
© Original Petition ¢ V (R. 94-95; A. 4); Second Amended
Complaint § 5 (R. 673).
3
the investment portfolios of EDS, including EDS’ pension
funds.'' EDS terminated Anderson in August 1989."
In his Original Petition, Anderson contended that he was
terminated because (i) he refused to do illegal acts requested by
Crow, his supervisor, (ii) he reported Crow’s illegal acts to EDS
management, and (iii) his accusations about Crow embarrassed
management.'? Anderson listed four allegedly illegal acts that he
contended Crow asked him to do, two of which Anderson claimed
would have violated ERISA.’* Anderson further alleged that
when he refused to do the acts requested by Crow, Crow either
did them himself or forced someone else to do them; Crow
threatened him after he refused to do the acts; and Crow and
Weynand “actively sought occasion to discriminate against and
ultimately terminate him because he refused to commit the illegal
acts and because of his accusations against Crow.”"”
'' Original Petition § IV (R. 94-95; A. 3-4); Second Amended
Complaint J 5 (R. 673).
'2 Original Petition XIII (R. 100; A. 9).
? Id.
'* According to Anderson, he was asked to:
sign on two separate occasions approval of payment invoices on
behalf of the pension portfolios under [Anderson’s] manage-
ment and supervision who (sic) had been retained by Crow
without approval of the pension trustees. Such action would have
been a violation of the Federal Employee Retirement Income
Security of 1974 (“Erisa”) Laws governing management of such
pension funds.
> * *
write up minutes for meetings which [ Anderson] did not attend
in connection with the EDS Retirement Plan. This also in
violation of ERISA (sic).
Original Petition § VII (R. 96-97; A. 4-5).
'S Original Petition ¥] VIII (R. 97; A. 6) and XI (R. 99; A. 8).
4
In his Motion to Remand, Anderson contended that
(i) certain of the illegal activities Crow asked him to do would
have violated ERISA, (ii) his refusal as a plan administrator to
violate ERISA was “a reason in whole or in part for his termina-
tion,” and (iii) his refusal to violate ERISA comprised a part of
his claim for wrongful discharge.'®
Anderson also admitted in his Motion to Remand that the
district court had supplemental jurisdiction under 28 U.S.C.
§ 1367." He urged the court, however, to decline to exercise its
supplemental jurisdiction “since all bases for federal jurisdiction
have been eliminated by pleading amendment.”'®
In April 1993, EDS took Anderson’s deposition. Anderson
testified that he was living and working in Oklahoma City,
Oklahoma.'? He further testified that he took the job in
Oklahoma City approximately nine months after he was termi-
nated in August 1989, which would have been about May or
June 1990." Anderson sued EDS in June 1991.
'® Motion to Remand p. 2 (R. 300; B. 2). In answers to interroga-
tories, Anderson maintained that Crow also violated ERISA by asking
him to sign the invoices and prepare the minutes. Plaintiff's Responses
to Douglas M. Crow’s Interrogatories (August 1, 1991), Answer to
Interrogatory 11 (Volume 4 of the Record, R. 58-60). See Brief of
Appellees p. 8, n. 20 (D. 15).
" 28 U.S.C. § 1367(a) provides in pertinent part that:
in any civil action of which the district courts have original
jurisdiction, the district courts shall have supplemental jurisdic-
tion over all other claims that are so related to claims in the
action within such original jurisdiction that they form part of the
same Case or controversy under Article III of the United States
Constitution. (C. 1).
'* Motion to Remand p. 4 (R. 302; B. 3).
'° Anderson Deposition at pp. 7-8 (R Sealed: E. 6-7).
” Id. at p. 6 (E. 6).
5
SUMMARY OF THE ARGUMENT
The circumstances of this case do not warrant the Court’s
exercise of its certiorari power. Anderson has made no showing of
conflict between the Fifth Circuit’s decision in this case and the
decisions of other federal or state courts. He argues only that the
Fifth Circuit failed to follow the decisions of this Court. The law
applicable to the issues raised by Anderson is well settled and was
correctly applied by the Fifth Circuit.
This Court’s decision in Ingersoll-Rand Co. v. McClendon,”'
makes clear that Anderson’s action “relates to” an ERISA plan.
His action referred to ERISA, was based on the existence of an
ERISA plan, and required the district court to inquire into
whether the actions alleged by Anderson would have violated
ERISA or an employee benefit plan covered by ERISA. More-
over, Anderson’s action conflicts with the civil enforcement
scheme of ERISA.
Likewise, this Court’s decisions in Metropolitan Life Ins. Co.
v. Taylor’? and McClendon teach that ERISA completely
preempts actions, like Anderson’s, that are within the civil en-
forcement scheme of ERISA. Anderson’s claim that he was
demoted, discriminated against, and terminated because he re-
fused to violate his fiduciary duties under ERISA and because he
reported the violations or attempted violations to EDS manage-
ment falls within the scope of § 502(a) of ERISA, resulting in
the district court having jurisdiction over his claim.
The arguments Anderson raises in his Petition for Certiorari
have been rejected by this Court. As this Court ruled in McClen-
don, ERISA is not merely collateral or incidental to a state
common law cause of action, but in fact relates to that action, if
that action refers to ERISA or an ERISA plan is necessary to
21 498 U.S. 133, 111 S.Ct. 478 (1990).
22 481 U.S. 58, 107 S.Ct. 1542 (1987).
6
pursue the action. In addition, this Court ruled in McClendon and
Taylor that ERISA completely preempts state common law
causes of action within the scope of § 502(a) even when ERISA
does not provide the same remedies available at common law,
ERISA does not provide a cause of action identical to the state
claim, or the plaintiff is not seeking any of the relief provided by
ERISA.
In addition to the grounds cited by the Fifth Circuit, EDS
respectfully contends that the district court’s finding of subject
matter jurisdiction could also be upheld based on the well-
pleaded complaint rule.” Resolution of Anderson’s wrongful
discharge claim under Texas law required Anderson to plead and
the district court to determine whether an ERISA plan existed,
whether Anderson was asked to commit acts which would have
violated that plan, and whether Anderson was fired solely for
refusing to commit those acts, satisfying the well-pleaded com-
plaint rule.
EDS further respectfully contends that given Anderson’s
failure to move for remand in a timely manner, under Grubbs v.
GECC,™ the proper test on appeal was whether the district court
could have had original jurisdiction of the case at the time it
entered summary judgment for EDS. *° Applying the Grubbs test,
the district court had original jurisdiction at that time based on
the complete diversity of the parties.
Finally, EDS notes Anderson admitted in his Motion to
Remand that the district court had supplemental jurisdiction
® Brief of Appellees pp. 16-18 (D. 22-25).
** 405 U.S. 699, 92 S.Ct. 1344 (1972).
°° Brief of Appellees pp. 39-45 (D. 44-49).
7
under 28 U.S.C. § 1367.° Anderson’s appeal and Petition for a
Writ of Certiorari are inconsistent with that admission.
EDS respectfully urges the Court to deny Anderson’s Peti-
tion for a Writ of Certiorari.
ARGUMENT
I. THE FIFTH CIRCUIT FOLLOWED THE DECISIONS
OF THIS COURT AND DID NOT ERR IN
UPHOLDING THE DISTRICT COURT’S REFUSAL
TO REMAND THE CASE.
The Fifth Circuit did not err in finding that Anderson’s
wrongful discharge cause of action (i) was preempted because it
related to an ERISA plan and conflicted with ERISA’s civil
enforcement scheme and (ii) stated a federal cause of action
under the complete preemption doctrine because it fell within the
scope of ERISA’s civil enforcement scheme. This Court has
addressed the issues raised by Anderson in several decisions,
including decisions in Ingersoll-Rand Co. v. McClendon and
Metropolitan Life Ins. Co. v. Taylor. The Fifth Circuit correctly
applied and followed those decisions in upholding the district
court’s denial of remand.
A. Anderson’s Wrongful Discharge Cause Of Action Was
Preempted Because It Relates To An ERISA Plan.
This Court has confirmed on numerous occasions the broad
reach of ERISA’s preemption provision, § 514(a).”” ERISA
% Motion to Remand p. 4 (R. 302; B. 3); Brief of Appellees p. 11,
n. 32 (D. 17).
2” See, e.g., District of Columbia v. Greater Washington Board of
Trade, _ U.S. —, —, 113 S.Ct. 580, 583 (1992); Ingersoll-Rand Co. v.
McClendon, 498 U.S. at 137, 111 S.Ct. at 482; Pilot Life Ins. Co. v.
Dedeaux, 481 U.S. 41, 46, 107 S.Ct. 1549, 1552 (1987).
displaces any state law that relates to an employee benefit plan
covered by ERISA, including state common law causes of ac-
tion.” This Court noted that a “law ‘relates to’ an employee
benefit plan, in the normal sense of the phrase, if it has a
connection with or reference to such a plan,””’ even if “the law is
not specifically designed to affect such [a] plan[ ], or the effect is
only indirect.”
In McClendon, this Court applied these ERISA preemption
principles to find McClendon’s Texas common law claim that his
employer wrongfully discharged him to avoid paying pension
benefits was preempted by ERISA.*' McClendon’s cause of
action related to an ERISA plan because the existence of a
pension plan was a critical factor in establishing liability:
(i) McClendon’s action made specific reference to the existence
of a pension plan; (ii) to prevail, McClendon had to plead and
prove the existence of a pension plan; and (iii) the court had to
direct its inquiry to the plan to rule on the claim.”
Following McClendon, the Fifth Circuit correctly held that
Anderson’s wrongful discharge claim also related to an ERISA
plan since it too required the existence of an ERISA plan to
8 § 514(a) and (c)(1), 29 U.S.C. § 1144(a) and (c) (1).
*? Ingersoll-Rand Co. v. McClendon, 498 U.S. at 139, 111 S. Ct. at
483, quoting, Shaw v. Delta Air Lines, 463 U.S. 85, 96-97, 103 S.Ct.
2890, 2900 (1983).
® Ingersoll-Rand Co. v. McClendon, 498 U.S. at 139, 111 S.Ct. at
483. See, e.g., District of Columbia v. Greater Washington Board of
Trade, — U.S. at —, 113 S.Ct. at 583 (1992); Pilot Life Ins. Co. v.
Dedeaux, 481 U.S. at 47-48, 107 S.Ct. at 1553.
*' Ingersoll-Rand Co. v. McClendon, 498 U.S. at 139-41, 111 S.Ct.
at 483-84.
2 Id. at 140, 111 S.Ct. at 483.
9
establish liability.*? As the Fifth Circuit noted, Anderson claimed
that he was wrongfully terminated because he refused to violate
ERISA and reported the requested violations to management.”
Under Texas common law, a discharged employee has a cause of
action if he can show he was terminated solely because he refused
to do an illegal act.** Thus, as in McClendon, the existence of a
pension plan was critical to establishing liability on Anderson’s
cause of action. Anderson’s claim made specific reference to an
ERISA plan; Anderson had to plead and prove the existence of a
pension plan; and the court had to direct its inquiry to the plan to
rule on the claim. In addition, ERISA was critical to Anderson’s
claim because to establish the claim Anderson also had to prove
the acts he refused to commit would have violated the plan or
ERISA.*
B. Anderson’s Wrongful Discharge Claim Was Preempted
Because It Conflicted With ERISA’s Civil Enforcement
Scheme.
This Court has also consistently recognized the comprehen-
sive nature of ERISA’s civil enforcement scheme embodied in
§ 502(a),°” and Congress’ intent that the enforcement scheme
33 Anderson v. Electronic Data Systems Corp., \1 F.3d 1311, 1314
(Sth Cir. 1994).
4 Id.
33 Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733, 735 (Tex.
1985).
% Id. (“it is the plaintiff's burden to prove by a preponderance of
the evidence that his discharge was for no reason other than his refusal
to perform an illegal act.”).
7 29 U.S.C. § 1132(a). Section 502(a) provides in part that any
participant, beneficiary, or fiduciary may bring a civil action:
(A) to enjoin any act or practice which violates any provision of
this subchapter or the terms of the plan, or (B) to obtain other
10
serve as the exclusive remedy for ERISA related violations.”
This Court found that McClendon sought a remedy under Texas
common law for the violation of a right expressly guaranteed by
§ 510°” and exclusively enforced by § 502(a) of ERISA, and held
that McClendon’s state law claim was preempted because of this
conflict.”
Relying on McClendon, the Fifth Circuit found that Ander-
son’s claim “conflict[ed] with the detailed and carefully balanced
remedy provisions of ERISA.”*' The Fifth Circuit explained that
Ҥ 502(a) provides remedies for participants, beneficiaries, and
fiduciaries of ERISA plans” and that based on Anderson’s allega-
tions, he was both a participant and a fiduciary.” The court
further explained that Anderson’s claim of discharge for refusing
to commit certain acts as a fiduciary and for reporting those
requested violations, fell squarely within the ambit of § 510 which
makes it unlawful to discharge or discriminate against any person
“for exercising ERISA rights or for the purpose of interfering
appropriate equitable relief (i) to redress such violations or (ii) to
enforce any provisions of this subchapter of the terms of the plan.
8 See, e.g., Ingersoll-Rand Co. v. McClendon, 498 U.S. at 144, 111
S.Ct. at 485; Pilot Life Ins. Co. v. Dedeaux, 481 U.S. at 54, 107 S.Ct. at
1566.
% 29 U.S.C. § 1140.
“ Ingersoll-Rand Co. v. McClendon, 498 U.S. at 145, 111 S.Ct. at
486.
*! Anderson v. EDS, \1 F.3d at 1314.
* Id. See 29 U.S.C. § 1002(7),(8), and (21) (C. 1-2). Section
502(a) is the exclusive enforcement scheme for all matters within
subchapter one of ERISA which includes all of the administrative and
enforcement provisions regarding ERISA plans, including, inter alia,
provisions pertaining to disclosure, reporting, preparation of plan de-
scriptions, filing and furnishing information, fiduciary duties and liabil-
ity, and coercion and interference with protected rights. 29 U.S.C. §§
1001-1145.
1]
with the attainment of ERISA rights, as well as for discharges for
providing information or testimony relating to ERISA.”
C. Anderson’s Wrongful Discharge Cause Of Action Was
Completely Preempted By ERISA Because It Was Within
The Scope Of ERISA’s Civil Enforcement Scheme.
Although federal preemption is ordinarily a defense and does
not support removal of a case to federal court, this Court has
recognized that Congress can so completely preempt an area of
the law that any state law cause of action within the area
preempted is treated as federal in character and is removable.” In
Taylor, this Court determined that the “complete preemption
doctrine” first applied to claims preempted by § 301 of the Labor
Management Relations Act*® (“LMRA”), also applies to claims
within the scope of the civil enforcement provisions of § 502(a) of
ERISA.* Furthermore, in McClendon, this Court recognized that
under the complete preemption doctrine announced in Taylor,
“an ERISA preemption defense provides a sufficient basis for
removal of a cause of action” to federal court.*”
Applying Taylor, the Fifth Circuit correctly held that Ander-
son’s claim of demotion and termination for refusing to violate
ERISA and reporting such violations fell within the scope of
§ 502(a) and was, therefore, removable.“ Anderson, a participant
*® Anderson v. EDS, 11 F.3d at 1314.
“ See, e.g., Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63-
64, 107 S.Ct. | 542, 1546 (1987).
** 61 Stat. 156, 29 U.S.C. § 185.
“ Metropolitan Life Ins. Co. v. Taylor, 481 U.S. at 66-67, 107
S.Ct. at 1547-48.
“’ Ingersoll-Rand Co. v. McClendon, 498 U.S. at 145; 111 S.Ct. at
486.
* Anderson v. EDS, 11 F.3d at 1315.
12
and fiduciary, alleged he was asked to violate ERISA provisions
which are enforced under § 502(a), that his supervisor committed
the violations when he refused, and that he was threatened,
demoted, discriminated against, and eventually terminated be-
cause of his refusal to violate ERISA. These allegations bring
Anderson’s claim within the scope of § 502(a).
II. IT IS ANDERSON WHO IS NOT FOLLOWING THE
DECISIONS OF THIS COURT.
In support of his Petition, Anderson argues that the district
court erred in refusing to remand the case because (i) ERISA is
collateral to his claim and, therefore, his claim is not related to an
ERISA plan, (ii) ERISA does not provide a remedy for his
claim, and (iii) his claim does not fall within the scope of
§ 502(a) because ERISA does not provide an action identical to
his wrongful discharge claim and he is not seeking any of the
relief provided by ERISA. Anderson’s arguments ignore and are
contrary to the teachings of this Court in McClendon and Taylor.
A. State Law Claims Are Subject To Preemption And
Removal Under ERISA.
Anderson argues that his wrongful discharge claim does not
relate to ERISA because it is based solely on state law. According
to Anderson, ERISA is collateral to his claim because it merely
identifies the type of law he refused to violate.” This Court
expressly and implicitly has rejected both arguments.
The facts of both Taylor and McClendon establish that state
law causes of action are subject to preemption and removal under
ERISA. Taylor asserted only state law claims for breach of
contract, to reimplement employment benefits and insurance
coverage, for wrongful termination, and for wrongful failure to
© Petition for a Writ of Certiorari pp. 11-12.
Ee
“ee
cts
13
promote.” McClendon asserted a wrongful discharge claim under
Texas common law.*' This Court in each case recognized the
application of the complete preemption doctrine to the state law
claims.”
In addition, as does Anderson, McClendon argued that the
pension plan was not relevant to his wrongful discharge action.
According to McClendon, the only issue was whether his em-
ployer’s motive for firing him was improper. This Court rejected
that argument because it missed the point “that under the Texas
court’s analysis there [was] simply no cause of action if there
[was] no plan.” Similarly, as the Fifth Circuit recognized,
Anderson can not establish his claim that he was fired because he
refused to violate an ERISA plan without establishing the exis-
tence of a plan and that the requested act would have violated
either the plan or ERISA.“
® Metropolitan Life Ins. Co. v. Taylor, 481 U.S. at 61, 107 S.Ct. at
1545.
‘!_ Ingersoll-Rand Co. v. McClendon, 498 U.S. at 136, 111 S.Ct. at
481.
2 Id at 145, 111 S.Ct. at 486; Metropolitan Life Ins. Co. v. Taylor,
481 U.S. at 67, 107 S.Ct. at 1548.
53 Ingersoll-Rand Co. v. McClendon, 498 U.S. at 140, 111 S.Ct. at
483-84.
* Anderson v. EDS, \\ F.3d at 1314.
Anderson cited Willy v. Coastal Corp., 855 F.2d 1160 (Sth Cir.
1988) in support of his position that ERISA was merely collateral.
Petition for a Writ of Certiorari pp. 9-11. The Fifth Circuit’s finding
that Willy’s claim of wrongful discharge for refusing to violate state and
federal environmental laws was not federal in nature is distinguishable
from the facts of this case and was not relied upon by the Fifth Circuit
below.
One, unlike Willy, who did not have a private cause of action under
federal environmental laws, Anderson could have had a private action
under ERISA. He could have brought an action to enjoin any of Crow’s
14
B. A State Law Claim Is Removable Even If ERISA Does
Not Provide A Remedy For The Claim.
Anderson further argues that removal of a state law claim is
impermissible unless ERISA provides a remedy for that claim.”
This Court rejected that argument in Taylor, McClendon, and
other ERISA decisions.
4
=
acts that allegedly violated ERISA or an action against Crow and others
for allegedly threatening, demoting, or terminating him for complying
with ERISA and providing information to management regarding the
alleged violations. See §§ 404(a)(1), 405(a), 409(a), and 502(a) of
ERISA, 29 U.S.C. §§ 1104(a)(1), 1105(a), 1109(a), 1132(a) (C. 1-
3); Original Petition J IV & VIII (R. 94-95, 97, A. 3-4, 6).
Two, as the Willy court recognized, a distinction exists between the
areas of environmental law, where the states and federal government
have been “traditional partners,” and employee benefit plan law, where
Congress through ERISA took from the states any shared responsibility
for the regulation of covered plans. Willy v. Coastal Corp., 855 F.2d at
1166 and 1167, n. 10. See Alessi v. Raybestos-Manhattan, Inc., 451 U.S.
504, 523, 101 S.Ct. 1895, 1906 (1981). Three, after Willy, this Court
determined in McClendon that ERISA is related to, and not merely
“collateral,” to a wrongful discharge claim that involves or is based on
an alleged violation of ERISA. Ingersoll-Rand Co. v. McClendon,
498 US. at 140, 111 S.Ct. at 483.
Anderson also cited two district court decisions from the Fifth
Circuit. Sperling v. Texas Health Enterprises, Inc., 791 F. Supp. 662
(S.D. Tex. 1992) and Nowoc v. Rheem Mfr. Co., 772 F. Supp. 977
(S.D. Tex. 1991). Each is distinguishable. Unlike McClendon (and
Anderson), Sperling was not a plan participant or beneficiary; Sperling
did not allege a violation of ERISA or of an ERISA plan as did
McClendon (and Anderson); and unlike McClendon (and Anderson),
Sperling had a cause of action even if an ERISA plan did not exist.
Sperling v. Texas Health Enterprises, Inc., 791 F. Supp. at 664-65.
Unlike McClendon (and Anderson), Nowoc did not allege a violation of
ERISA or that an ERISA violation was involved in any way with his
termination. Nowoc v. Rheem Mfr. Co., 772 F. Supp. at 979. See Brief of
Appellees pp. 21-25 and accompaning notes, (D. 26-30).
* Petition for a Writ of Certiorari p. 15.
15
In modeling § 502(a) after § 301, “Congress was well aware
that the powerful preemptive force of §301 of the LMRA
displaced all state law claims, even when the state action pur-
ported to authorize a remedy unavailable under the federal
provision.” The careful crafting of ERISA’s enforcement
scheme is “strong evidence that Congress did not intend to
authorize other remedies it simply forgot to incorporate ex-
pressly.”°’ As this Court recognized, the policy choices reflected
in the inclusion of certain remedies and the exclusion of others
from ERISA’s comprehensive enforcement scheme would be
completely undermined if participants and beneficiaries were free
to obtain remedies under state law that Congress rejected in
ERISA.*
© Ingersoll-Rand Co. v. McClendon, 498 U.S. at 144, 111 S.Ct. at
485-86. See also Corcoran v. United Healthcare, Inc., 965 F.2d 1321
(Sth Cir.), cert. denied, _ U.S. —, 113 S.Ct. 812 (1992) and Hansen v.
Continental Ins. Co., 940 F.2d 971 (Sth Cir. 1991) discussed in Brief of
Appellees pp. 37-39 (D. 42-44).
*” Pilot Life Ins. Co. v. Dedeaux, 481 U.S. at 54, 107 S.Ct. at 1556,
quoting, Massachusetts Mutual Life Ins. Co. v. Russell, 473 U.S. 134,
146, 105 S.Ct. 3085, 3092 (1985).
8 Jd. at 144, 111 S.Ct. at 485; Metropolitan Life Ins. Co. v. Taylor,
481 U.S. at 64-65; 107 S.Ct. at 1547; Pilot Life Ins. Co. v. Dedeaux,
481 U.S. at 54, 107 S.Ct. at 1556.
Congress sought “to ensure that plan and plan sponsors would be
subject to a uniform body of law; the goal was to minimize the
administrative and financial burdens of complying with conflicting
directives among States or between States and the Federal Govern-
ment.” Ingersoll-Rand Co. v. McClendon, 498 U.S. at 142, 111 S.Ct. at
484. Allowing state common law actions such as McClendon’s, and
Anderson’s here, to proceed “would subject plans and plan sponsors to
burdens not unlike those that Congress sought to foreclose through
§ 514(a).” Id.
It is foreseeable that state courts, exercising their common law
powers, might develop different substantive standards applicable to
the same employer conduct, requiving the tailoring of plans and
employer conduct to the peculiarities of the law of each jurisdiction.
16
C. Complete Preemption May Occur Even If ERISA Does
Not Provide An Action Identical to the Action Being
Preempted Or The Plaintiff Is Not Seeking Any Relief
Under ERISA.
Anderson further argues that his cause of action is not within
the scope of §502(a) of ERISA because ERISA does not
provide a specific cause of action for someone terminated for
refusing to violate ERISA. In addition, Anderson argues that his
claim is not within the scope of § 502(a) because he is not
seeking any of the relief provided in the section.” Anderson,
however, misconstrues the test announced in Taylor, and followed
in McClendon, for applying the complete preemption doctrine.
As the Taylor decision teaches, the test for complete pre-
emption is not whether ERISA provides a cause of action
identical to the state law action being preempted, but whether
that state law action is “within the scope of the civil enforcement
provisions of § 502(a)." The Taylor test is consistent with
Congress’ desire for uniformity and the recognition of the policy
choices that went into formulating the exclusive federal remedy.
Such an outcome is fundamentally at odds with the goal of
uniformity that Congress sought to implement. Jd.
This court left standing a decision in the Sixth Circuit that ERISA
preempted a claim of wrongful discharge for fulfilling ERISA duties.
See Authier v. Ginsberg, 757 F.2d 796, 802 (6th Cir.), cert. denied,
474 U.S. 888, 106 S.Ct. 208 (1985) (“allowing the remedies available
to an ERISA fiduciary discharged for complying with ERISA to tum
upon the state of his employment and a state court’s interpretation of
ERISA’s provisions runs contrary to Congress’ desire to establish a
uniform federal law regulating pension laws’’).
*® Petition for a Writ of Certiorari pp. 16-19.
© Metropolitan Life Ins. Co. v. Taylor, 481 U.S. at 66-67, 107
S.Ct. at 1548. This Court found that Taylor’s state law claims, including
a claim for wrongful termination, were all properly removed even though
ERISA did not provide a cause of action identical to any of his state law
claims.
17
This Court has applied the test to find state law actions without
counterparts in ERISA preempted.”
In McClendon, this Court also rejected Anderson’s argument
that he is not seeking any of the specific relief provided by
§ 502(a). This Court found that “there is no basis in § 502(a)’s
language for limiting ERISA actions to only those which seek
‘pension benefits’ . . . . Consequently, it is no answer to a
preemption argument that a particular plaintiff is not seeking
recovery of pension benefits.” =
[l. ADDITIONAL GROUNDS EXIST TO SUPPORT
THE DECISION OF THE COURT OF APPEALS
UPHOLDING THE DISTRICT COURT’S REFUSAL
TO REMAND.
Additional grounds exist for finding that the district court
had jurisdiction to enter summary judgment in favor of EDS.”
One, under the well-pleaded complaint rule, Anderson’s claim
was federal in nature which gave the district court removal
jurisdiction.” Two, the district court had original subject matter
jurisdiction at the time it entered the summary judgment in favor
‘' Ingersoll-Rand Co. v. McClendon, 498 U.S. at 136 and 145, 111
S.Ct. at 481 and 486; Metropolitan Life Ins. Co. v. Taylor, 481 U.S. at
66-67, 107 S.Ct. at 1548; Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 43
and 56, 107 S.Ct. 1551 and 1558.
® Ingersoll-Rand Co. v. McClendon, 498 U.S. at 145, 111 S.Ct. at
486.
6} “1 A} prevailing party may . . . defend its judgment on any
ground properly raised below whether or not that ground was relied
upon, rejected, or even considered by the District Court or the Court of
Appeals . . . . ” Granfinanciera, S.A. v. Nordberg, 492 U.S. 33, 38, 109
S.Ct. 2782, 2788 (1989), quoting, Washington v. Yakima Indian Na-
tion, 439 U.S. 463, 476, n. 20, 99 S.Ct. 740, 749, n. 20 (1979). See, e.g.,
Whitley v. Albers, 475 U.S. 312, 326, 106 S.Ct. 1078, 1087 (1986).
* Brief of Appellees pp. 16-18 (D. 22-24).
18
of EDS.® Three, Anderson admitted in his Motion to Remand
that the district court had supplemental jurisdiction.”
A. The District Court Had Removal Jurisdiction Under The
Well-Pleaded Complaint Rule.
In determining whether a civil action arises under federal
law, courts apply the “well-pleaded complaint” rule. The rule
provides that a cause of action arises under federal law only when,
at the time of removal, the plaintiff's well-pleaded complaint
raises issues of federal law or discloses a federal controversy.*’
When “the vindication of a right under state law necessarily turns
upon some construction of federal law,” or when the ~ction
requires the resolution of a substantial question of federal law,
that action arises under federal law.”
Anderson’s Original Petition, the pleading upon which re-
moval was based, raised issues of federal law that had to be
resolved to rule on his claim.” To succeed on his wrongful
® Id. at pp. 39-45 (D. 44-49).
Jd. at p. 11, n. 32 (D. 17).
®’ Metropolitan Life Ins. Co. v. Taylor, 481 U.S. at 63, 107 S.Ct. at
1546; Gully v. First Nat'l Bank in Meridian, 299 U.S. 109, 112-13, 57
S.Ct. 96, 97-98 (1936).
% Kidd v. Southwest Airlines, Co., 891 F.2d 540, 542 (Sth Cir.
1990).
® Franchise Tax Board of CA. v. Construction Laborers Vacation
Trust for Southern CA., 463 U.S. 1, 27-28, 103 S.Ct. 2841, 2856
(1983).
” Anderson argues that the well-pleaded complaint rule is not
applicable because, as the Fifth Circuit noted, his Original Petition did
not contain a federal cause of action. Petition for a Writ of Certiorari
pp. 9 & 22. Contrary to Anderson’s assertion, this is the exact situation
in which the rule is applied. The rule is used to determine whether the
State action requires resolution of a federal question. Franchise Tax
Board of CA. v. Construction Laborers Vacation Trust for Southern CA.,
19
discharge claim, Anderson had to show that he was asked to
commit an act in violation of ERISA and was fired solely because
he refused to do so. To rule on Anderson’s claim, a court would
have had to determine whether an ERISA plan existed and
whether the acts allegedly requested of Anderson would have
violated the plan or ERISA.
B.. The District Court Had Original Jurisdiction At The
Time It Entered Judgment For EDS.
Based on Anderson’s delay in seeking to remand the case,
the district court had original jurisdiction to enter summary
judgment in favor of EDS in June 1993. This Court held in
Grubbs v. GECC that an alternative standard governs the deter-
mination of subject matter jurisdiction when (i) a case is improp-
erly removed to federal court, (ii) the federal court nonetheless
tries the case on the merits and enters judgment, and (ili) no
objection is raised regarding removal until after judgment is
entered.’’ Under Grubbs, the judgment is upheld if the district
court would have had original jurisdiction over the case based on
the record and the pleadings as they existed at the time of the
judgment.”
Assuming for the sake of argument that Anderson is correct
that EDS improvidently removed this case, the first factor in
Grubbs is satisfied. Similarly, the second factor is satisfied by the
entry of the summary judgment in favor of EDS.” The third
factor is satisfied by Anderson’s failure to file a timely motion to
463 US. at 13, 103 S.Ct. at 2848 (Even though state law creates
plaintiff's cause of action, his case might still “arise under” federal law,
as determined under the well-pleaded complaint rule).
7) 405 U.S. 699, 702, 92 S.Ct. 1344, 1347 (1972).
72 Id See also American Fire & Casualty Co. v. Finn, 341 US. 6,
16, 71 S.Ct. 534, 541 (1951); Mackay v. Uinta Development Company,
229 U.S. 173, 33 S.Ct. 638, 639 (1913).
73 Kidd v. Southwest Airlines, 891 F.2d 540, 546 (Sth Cir. 1990).
20
remand.”* Anderson waived any defect in the removal except for
lack of subject matter jurisdiction by not moving to remand the
case within 30 days of its removal.”®
The record at the time of entry of the judgment established
that diversity of citizenship existed between Anderson, an
Oklahoma resident, and EDS, a Texas resident.”® Initially, and at
the time of the summary judgment, the case could have been
™ 28 U.S.C. § 1447(c) (30 day period to move for remand)
(C. 1).
> If a federal district court has original jurisdiction of an action
improperly removed and the plaintiff fails to file a timely motion to
remand, then the district court may retain jurisdiction of the action even
if it lacked removal jurisdiction. See, e.g. Williams v. AC Spark Plugs
Div. of General Motors Corp., 985 F.2d 783, 787 (Sth Cir. 1993); In re
Digicon Marine, Inc., 966 F.2d 158, 160 (Sth Cir. 1992); Baris v.
Sulpicio Lines, Inc., 932 F.2d 1540, 1543 (Sth Cir.), cert. denied, —
U.S. —, 112 S.Ct. 430 (1991).
The basis for the court’s original jurisdiction does not have to have
been asserted as a basis for removal, Baris v. Sulpicio Lines, Inc., 932
F.2d at 1545-46, and often could not have served as a basis for removal,
In re Shell Oil Co., 932 F.2d 1518, 1519 (Sth Cir. 1991), cert. denied,
— U.S. —, 112 S.Ct. 914 (1992) (the diversity of the parties’ residence
supported original jurisdiction but not removal jurisdiction).
© Anderson alleged in his Original Petition that he was a Texas
resident. When EDS took Anderson’s deposition in April 1993, it
learned for the first time that Anderson was not a Texas resident when
he filed suit. Anderson testified that he moved to Oklahoma City,
Oklahoma and got a job there within nine or ten months of being
terminated by EDS in August 1989, which would have been sometime
in May or June 1990. Anderson filed suit in June 1991. Anderson further
testified at his deposition that he had held that same job through the
date of the deposition. Anderson Deposition pp. 6-8, 28 (E. 6-9).
This Court in Grubbs relied on record excerpts from discovery
proceedings to establish the original jurisdiction of the district court.
Grubbs v. GECC, 405 U.S. at 704, 92 S.Ct. at 1348.
21
brought in a federal district court sitting in Dallas, Texas.”
Original jurisdiction based on diversity of citizenship existed from
the beginning of the suit through the entry of summary judgment
in favor of EDS.
C. Anderson Admitted That The District Court Had
Supplemental Jurisdiction.
In his Motion to Remand, Anderson admitted that the
district court had supplemental jurisdiction pursuant to 28 U.S.C.
§ 1367.” He urged the court, however, to exercise its discretion
and not keep the case based on that jurisdiction.” Anderson did
not argue on appeal and does not argue now that the district court
abused its discretion under § 1367 in retaining the case. Ander-
son’s appeal and Petition for Certiorari are inconsistent with his
admission that the district court had supplemental jurisdiction.
CONCLUSION
Anderson is asking this Court to allow him to pursue his
claim in the face of the clear intent of Congress, as recognized by
this Court, to provide a uniform body of law applicable to ERISA
plans and plan administration, to establish a comprehensive
enforcement scheme within ERISA to address violations, and to
preempt all state actions that fall within the scope of that scheme.
To allow Anderson to proceed in state court, this Court would
have to ignore the well established body of law addressing ERISA
preemption.
See, e.g., In re Shell Oil Co., 932 F.2d at 1519 (upheld district
court decision not to remand because plaintiff failed to move for remand
within 30 days and district court had original jurisdiction based on
diversity of citizenship, even though the diversity would not have
supported removal jurisdiction).
78 Motion to Remand p. 4 (R. 302; B. 3)(C. 1).
” Id.
22
The Fifth Circuit correctly followed the decisions of this
Court, including McClendon and Taylor, in finding that the
district court had jurisdiction to enter summary judgment in favor
of EDS. At the time it entered judgment for EDS, the district
court had removal jurisdiction under the complete preemption
doctrine as found by the Fifth Circuit. The district court also had
removal jurisdiction under the well-pleaded complaint rule and
original subject matter jurisdiction based on diversity of citizen-
ship. In addition, Anderson recognized at the time he sought to
remand the case that the district court had supplemental
jurisdiction.
EDS requests that this Court deny Anderson’s Petition for
Certiorari and allow the decision of the Fifth Circuit to stand.
Respectfully submitted,
Phillip N. Smith Jr.
Counsel of Record
Jeffrey A. Carter
Michael Andrew Piazza
McKool Smith, P.C.
300 Crescent Court, Suite 1500
Dallas, Texas 75201
214-978-4000
Counsel for Respondents,
Electronic Data Systems
Corporation, Anthony E. Weynand,
Richard P. Shlakman, and
Darrell Johnson
NO. 91-7509
GEORGE RAYMOND (ANDY)
ANDERSON IN THE DISTRICT
COURT OF
vs.
DALLAS COUNTY,
ELECTRONIC DATA SYSTEMS Corp., TEXAS
DouGLas M. Crow,
ANTHONY E. WEYNAND,
AND RICHARD P. SHLAKMAN,
DARRELL JOHNSON
JUDICIAL DISTRICT
PLAINTIFF’S ORIGINAL PETITION
TO THE HONORABLE JUDGE OF SAID COURT:
COMES NOW, GEORGE RAYMOND (ANDY)
ANDERSON (“Anderson”) Plaintiff in above-styled and num-
bered cause, and files this his Plaintiff's Original Petition, com-
plaining of Electronic Data Systems Corporation (“EDS”),
Douglas M. Crow (“Crow”), Anthony E. Weynand (“Wey-
nand”’), Richard P. Shlakman (“Shlakman”) and Darrell John-
son (“Johnson”) Defendants, and for cause of action would show
the Court the following:
I.
Plaintiff is a resident of the State of Texas, and was at the
time of the incident.
Defendant EDS is a Texas corporation whose principal place
of business is located in Dallas County, Texas. Service of process
on EDS may be accomplished by serving its attorney, Phillip N.
Smith, BAKER & BOTTS, 2001 Ross Avenue, Suite 800,
Dallas, Texas 75201, who has indicated he will accept service on
behalf of such Defendant.
A-2
Defendant Crow is a resident of Dallas County, Texas.
Service of process may be accomplished by serving his attorney,
Patrick Shaw, WOODWARD & SHAW, 6688 North Central
Expressway, Suite 1190, Dallas, Texas 75206, who has indicated
he will accept service on behalf of such Defendant.
Defendant Weynand is a resident of Dallas County, Texas.
Service of process on Defendant Weynand may be accomplished
by serving his attorney, Phillip N. Smith, BAKER & BOTTS,
2001 Ross Avenue, Suite 800, Dallas, Texas 75201, who has
indicated he will accept service on behalf of such Defendant.
Defendant Shlakman is a resident of Dallas County, Texas.
Service of process on Defendant Shlakman may be accomplished
by serving his attorney, Phillip N. Smith, BAKER & BOTTS,
2001 Ross Avenue, Suite 800, Dallas, Texas 75201, who has
indicated he will accept service on behalf of such Defendant.
Defendant Johnson is a resident of Dallas County, Texas.
Service of process on Defendant Johnson may be accomplished
by serving his attorney, Phillip N. Smith, BAKER & BOTTS,
2001 Ross Avenue, Suite 800, Dallas, Texas 75201, who has
indicated he will accept service on behalf of such Defendant.
Il.
This Court has jurisdiction over this suit because it is a suit
for damages in an amount in excess of the minimum jurisdictional
limits of this Court. This Court further has venue over this cause
of action because (1) Plaintiff's cause of action arose in whole or
in part in Dallas County, Texas; (2) one or more of the individual
Defendants is a resident of Dallas County, Texas; and (3)
corporate Defendant EDS has its principal place of business, as
well as an agent or representative, in Dallas County, Texas. No
mandatory venue provision exists which would mandate venue as
to any of the Defendants in any other county.
A-3
Il.
Anderson is a well qualified individual, by virtue of educa-
tion, training, and work experience, in the fields of finance,
financial management, investments, and investment portfolio
management. Anderson has a Bachelor of Business Administra-
tion degree with a major in Finance from the University of
Oklahoma/Central State University, and a Masters Degree in
Business Administration in Finance/Management from Central
State University. Prior to October 1984, Anderson had worked as
an assistant cashier for the First State Bank & Trust Company of
Guthrie, Oklahoma, at United Oklahoma Banc Shares in
Oklahoma City, Oklahoma in a variety of positions including
Assistant Vice President in the investment department, as a
General Manager Trainee for Marlin Hydrocarbon, Inc. of Guth-
rie, Oklahoma and as the Economic and Planning Coordinator for
Petro-Lewis Corporation (Mid Continent Region) of Oklahoma
City, Oklahoma.
IV.
On October 15, 1984, Anderson was employed by Defen-
dant EDS for a managerial position in the Domestic Treasury
Department of Defendant EDS. From October 1984 to Octo-
ber 1985, Anderson served as the Cash Manager in the Domestic
Treasury Department, where his responsibilities included man-
agement of all cash operations, short term investments, cash
forecasting, and related information systems plus consulting with
various groups within the EDS system. In October of 1985,
Plaintiff was promoted to position of Manager of Investments and
Debt in the Domestic Treasury Department. In that position,
Plaintiff had responsibilities for all domestic short and long-term
investments for all pension portfolios, corporate portfolios, and
Title 1X portfolios. In this position, Plaintiff was charged with the
responsibility of administering investment assets totaling approxi-
mately 1.3 billion dollars. In addition, Anderson was responsible
A-4
for all Domestic lines of credit as well as all letters of credit and
all related investment systems plus consulting for various groups
within EDS.
. &
In his position as Manager of Investments and debt in the
Domestic Treasury Department, Anderson never lost money from
the investments he initiated on behalf of the various EDS entities
in his charge. His performance in his job was consistently judged
to be superior by his supervisors and others, and he received
numerous commendations on his performance. Prior to Janu-
ary 1988, Anderson had never received any reprimands for or
complaints about his performance in his position with EDS.
VI.
In his position as Cash Manager in the Domestic Treasury
Department of EDS, Anderson reported directly to Crow, who
held the position at that time as Assistant Treasurer of the
Domestic Treasury Department of EDS. Crow in turn reported to
Weynand, who was the Treasurer/Comptroller and Vice-Presi-
dent of EDS Corporation.
VII.
During the course of his employment with EDS, Anderson
was asked by Crow, his immediate supervisor, to commit certain
illegal acts, at Crow’s direction. These illegal acts included;
1. Being asked to sign on two separate occasions approval
of payment invoices on behalf of the pension portfolios
under his management and supervision who had been
retained by Crow without approval of the pension trust-
ees. Such action would have been a violation of the
Federal Employee Retirement Income Security Act of
1974 (“Erisa”) Laws governing management of such
pension plans.
A-5
Plaintiff was asked by Crow to intentionally fail invest-
ment transactions made on behalf of EDS. The appar-
ent motive behind such a request was Crow’s effort to
get another manager in the EDS system, who was
associated with the transacticn in question, in trouble
with EDS management. Such intentional failure of an
investment transaction would have been a violation of
various laws and regulations promulgated and enforced
by the Federal Securities and Exchange Commission.
Plaintiff was also asked to write up minutes for meetings
which he did not attend in connection with the EDS
Retirement Plan. This also is in violation of ERISA.
Crow also asked Plaintiff to falsify interest income
projections, thereby committing criminal fraud, in con-
nection with the ZX Hierarchy Revenue Account. This
account was used as a repository for interest income
generated by investments managed by Anderson’s de-
partment. By deliberately under-reporting the projected
income in such account, Crow was able to use the
income in the account in excess of the under-reported
projections to make purchases in the department and
pay expenses without the required approval of his super-
iors, in complete circumvention of the EDS Financial
Accounting System/Budget for the Domestic Treasury
Department, and without any type of accounting to
anyone within EDS for where the money would be
going. Because the corporate management at EDS did
not expect income in the ZX Hierarchy account to
exceed the under-reported projections, Crow, by under-
reporting the income projections, in essence created a
pool of funds in the ZX Hierarchy Account from which
expenditures or disbursements could be made at Crow’s
sole discretion and under his sole control.
A-6
VIL.
Plaintiff refused these requests to permit illegal acts thereby
incurring the enmity of Crow including verbal threats made to
Anderson by Crow on three separate occasions. In several in-
stances, after Anderson had refused to perform the illegal acts,
Crow either performed them himself or forced other employees of
EDS Corporation to perform such acts.
IX.
Additionally, during the course of his employment, Plaintiff
became aware that Crow was engaging in various illegal acts, or
unauthorized activities, himself. The illegal or unauthorized activ-
ities of which Plaintiff became aware, in addition to those previ-
ously listed in which Plaintiff was asked by Crow to participate,
included the following:
1. Insider trading by Crow with respect to EDS stock,
Class E stock in the General Motors Corporation which
arose from an October 18, 1984 purchase of EDS by the
General Motors Corporation, and subsequent trades
thereafter in both GM stock and stock of various third
parties who contracted with EDS. In particular, Crow
purchased substantial volumes of EDS stock prior to the
merger with General Motors, at a time when Crow was
aware of the pending purchase by General Motors by
virtue of his position within EDS but the General Public
had not yet been advised of the pendency of the
purchase. When the General Motors takeover was an-
nounced, EDS stock substantially rose in value and
Crow was able to make a substantial profit as a result of
his insider knowledge regarding the proposed
transaction.
2. Crow engaged in various conflict of interest transactions
with vendors and suppliers of products and services of
A-7
EDS. Crow utilized favored vendors and awarded them
contracts without letting such contracts out for bids, as
required by EDS as established procedures. Crow fur-
ther utilized his influence within EDS and over his
subordinates in his department to eliminate work done
by competitors of these favored firms, and to force
contracts to be given to these favored firms, even though
such contracts were unauthorized, or unapproved by the
necessary parties within the EDS system, and even
though the services and products offered by these fa-
vored vendors were of lessor quality and/or higher cost
than similar products offered by other parties.
3. Making unauthorized purchases of equipment.
4. Misuse of corporate funds related to various products
H within his department.
5. Requesting that bank accounts be intentionally over-
drafted and that individuals in the department inten-
tionally lie to various department heads of other subsidi-
aries in order to hide the fact that checks were being
written within the department without proper
authorization.
6. Violations of the internal written code of ethics promul-
gated by EDS for its employees.
X.
In January, 1988, Anderson approached Darrell Johnson, the
Assistant Treasurer over the International Treasury Department
of EDS who basically held a management position equivalent to
that of Crow in another department, about the illegal activities in
which he had been asked to participate by Crow and about the
other irregularities which Crow had committed. Anderson made
Jchnson aware that EDS was about to be audited by auditors
from General Motors Corporation, and stressed to Johnson that if
A-8
'
these problems surfaced during the audit process, EDS and the
entire department would be substantially damaged. Between Jan-
uary of 1988 and May of 1988, Anderson made detailed, specific,
and written reports to Johnson regarding Crow’s activities. At
Anderson’s request, Johnson was asked to raise these concerns
with Weynand and to investigate these perceived problems
further.
XI.
In May or June 1988, Johnson brought to Weynand’s atten-
tion, the problems regarding Crow’s activities. Weynand, rather
than conducting an investigation or taking corrective action,
instead made known to Crow the allegations that had been made
by Anderson regarding Crow’s activities. From that point forward,
Weynand and Crow actively sought occasion to discriminate
against and ultimately terminate Plaintiff from his employment
with EDS because of his refusal to participate in illegal activities
at Crow’s direction and because of the allegations which he had
leveled against Crow’s activities within the department.
XII.
Although Anderson’s performance within the department
continued to be superior, in January 1989, Anderson was in-
formed by Crow that he was being demoted to a managerial
position one level below that previously held by him. Anderson’s
investment responsibilities were taken from him and turned over
to another individual in his department who had no investment
experience whatsoever. The demotion was solely motivated by a
desire on the part of Weynand and Crow, acting as managerial
agents and employees of EDS, to retaliate against Anderson for
his refusal to participate in the illegal activities and for his
reporting of the irregular activities of Crow to his superior. The
demotion was also part of a well organized plan on the part of
Crow, Weynand, and EDS to find a reason to get Anderson out of
A-9
the department and retaliation for his refusal to participate in
illegal activities and in retaliation for his leveling charges of
irregular conduct against Crow. Upon notification of the demo-
tion, Anderson immediately spoke with EDS in-house counsel
and also spoke with Davis Hamlin (Chief Financial Officer) at
EDS regarding this matter and was subsequently reinstated ap-
proximately one week later.
XIII.
Despite a continuance of his superior performance, Plaintiff
was terminated from his employment with EDS on August 23,
1989. The termination of employment was made solely in retalia-
tion against Plaintiff for his refusal to participate in illegal
activities of Crow’s request and in retaliation for his leveling of
additional charges against Crow regarding Crow’s irregular per-
formance and for the subsequent embarrassment this created for
senior management of EDS.
XIV.
Since his termination at EDS, Plaintiff has interviewed with
numerous companies throughout the United States seeking a
management level position within his field in finance, financial
management, and investments. A number of respective employers
have expressed interest in retaining Anderson as an employee in
such a position, but in each instance have been dissuaded from
giving Plaintiff employment in this field by the comments and
remarks of EDS, Crow, Weynand, Shlakman, and/or Johnson.
Such conduct and remarks by EDS were done solely with the
intent of denying Plaintiff employment in his field in retaliation
for his refusal to participate in illegal acts at Crow’s direction and
because of his reporting of the illegal or irregular activities of
Crow’s direction. and because of his reporting of the illegal or
irregular activities of Crow to his superiors in the EDS system.
A-10
XV.
At all times relevant to this cause of action, Crow, Weynand,
Shlakman and Johnson have been management level employees
and officers of EDS at all time relevant to this cause of action,
Crow, Weynand, Shlakman and Johnson have been acting in the
course and scope of their employment for EDS.
XVI.
EDS has breached its contract of employment with Plaintiff
and has wrongfully discharged Plaintiff from his position of
employment with EDS, by demoting and then discharging Plain-
tiff from his position of employment at EDS because of, and in
retaliation for, Plaintiffs refusal to commit illegal activities at
Crow’s request and because of his reporting of Crow’s own illegal
or irregular activities to EDS Management. Such breach of
contract and such wrongful termination is a proximate cause of
damages to Plaintiff.
XVII.
Further, Defendants Crow, Weynand, Shlakman, Johnson,
and EDS have intentionally and tortiously interfered with Plain-
tiffs perspective business and prospective contractual relation-
ships with other prospective employers following his wrongful
discharge with EDS. Such interference was done maliciously,
with the intent to retaliate against Plaintiff for his refusal to
participate in illegal activities and for his reporting of the illegal or
irregular activities of Crow, and was done without legal justifica-
tion or excuse. Such acts of interference have been a proximate
cause of damages to Plaintiff.
XVIII.
Further, Defendants Crow, Weynand, Shlakman, Johnson,
and EDS have negligently, or in the alternative intentionally,
A-11
sought to inflict emotional distress to Anderson in retaliation for
Anderson’s refusal to participate in illegal activities at Crow’s
direction and reporting of Crow’s own illegal or irregular activi-
ties. Such actions have in fact been a proximate cause of emo-
tional distress and other damages to Plaintiff.
XIX.
As a direct and proximate result of the above and foregoing
activities on behalf of Defendants, Plaintiff has been damaged in
an amount in excess of the minimum jurisdictional limits of this
Court. The elements of the Plaintiff's actual damage include past
and future mental anguish, past and future loss of earning
capacity, past and future loss of fringe benefits, and past and
future incidental and consequential damages.
XX.
Further, Defendants Crow, Weynand, Shlakman, Johnson,
and EDS have committed the above and fore-mentioned actions
with malice and intentionally. Alternatively, Defendants Crow,
Weynand, Shlakman, Johnson, and EDS have committed such
actions in conscious disregard of the rights and welfare of Ander-
son and other similarly situated, and therefore have acted with
gross negligence. Such actions by Defendant are a proximate
cause of damage to Plaintiff. The aforementioned acts were
further committed by Defendant EDS by its managerial agents or
vice-principals, or alternatively, were authorized or ratified by
Defendant EDS. Accordingly, Plaintiff is entitled to recover
exemplary damages from Defendants Crow, Weynand,
Shlakman, Johnson and/or EDS. The amount of exemplary
damages sought by EDS are in excess of the minimum jurisdic-
tional limits of this Court.
XXI.
Further, Plaintiff has been forced to retain the undersigned
attorney in order to prosecute his claims against Defendants EDS,
Crow, Weynand and Shlakman. Plaintiff has promised to pay said
attorney reasonable fee in Dallas County, Texas for legal services
necessarily expended or incurred in connection with the prosecu-
tion of these claims and the prosecution of this suit. Plaintiff has
heretofore made written demand upon Defendants in connection
with this claim more than thirty days prior to the institution of
this suit. Plaintiff is therefore entitled to recover his reasonable
attorneys fees, both through the trial and on appeal from Defend-
ants pursuant to §38.001 et. seq. of the Texas Civil Practice and
Remedies Code. The amount of the attorneys fees sought in this
regard is in excess of the minimal jurisdictional limitations of this
court.
A-13
WHEREFORE, PREMISES CONSIDERED Plaintiff
prays that Defendants be cited to appear herein, that upon final
hearing hereof, Plaintiff do have and recover judgment of and
from Defendants, jointly and severally, for Plaintiff's actual dam-
ages, pre-judgment interest on such actual damages, cost of suit,
and post-judgment interest on such amounts; that Plaintiff further
do have and recover judgment of and from Defendants severally
for exemplary damages with post-judgment interest on such
amounts; for such other and further relief both at law and in
equity, to which the Plaintiff may show himself to be justly
entitled and to which he will ever pray.
Respectfully submitted,
STRADLEY, SCHMIDT, AND WRIGHT
One, Campbell Centre
Dallas, Texas 75206
(214) 696-4880
Fax: 696-8134
By
C. L. MIKE SCHMIDT, P.C.
State Bar No. 17766000
Attorneys for Plaintiffs
=
a
B-1
IN THE UNITED STATES DISTRICT COURT
NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
GEORGE RAYMOND (ANDY)
ANDERSON
)
)
VS.
ELECTRONIC DATA SYSTEMS ) CIVIL ACTION
)
)
)
)
CORP., DOUGLAS M. CROW, NO. CA3-91-1489-G
ANTHONY E. WEYNAND, AND
RICHARD P. SHLAKMAN,
DARRELL JOHNSON
MOTION TO REMAND
TO THE HONORABLE JUDGE OF SAID COURT:
COMES NOW GEORGE RAYMOND (ANDY)
ANDERSON, Plaintiff in the above styled and numbered cause,
and files this his Motion to Remand, and as grounds therefore
would show the Court the following:
1.
PROCEDURAL HISTORY OF THE CASE
1. This is a cause of action arising out of Plaintiffs former
employment with Defendant Electronic Data Systems Corpora-
tion (“EDS”). Plaintiff filed this cause of action in the 191st
Judicial District Court of Dallas County, Texas. His suit was
based upon allegations of wrongful discharge and other tortious
conduct by Defendants, and his cause of action was predicated
entirely upon the law of the state of Texas. No federal causes of
action were alleged in Plaintiff's petition.
B-2
2. Asa part of his wrongful discharge claim, Plaintiff alleged
in his Plaintiff's Original Petition that he had been terminated by
EDS in whole or in part because he had refused to participate in
illegal activities which he had been directed to perform by his
supervisor at EDS, Defendant Douglas M. Crow (“Crow”).
Certain of those activities would, had Plaintiff performed them,
have been in violation of the Employee Retirement Income
Security Act (“ERISA”), Plaintiff's job at EDS having been at
least in part to participate in the administration of pension and
profit sharing plans of EDS. Plaintiff's Original Petition alleged
that his refusal to perform violations of ERISA as a plan
administrator was a reason in whole or in part for his termination.
3. Such allegations stated a cause of action for wrongful
discharge under the common law of the state of Texas. No cause
of action was stated by Plaintiff under ERISA, and no damages
were sought by Plaintiff against Defendants because of claims
handling of ERISA benefit claims. The refusal of Plaintiff to
violate ERISA was pled merely as one of the improper reasons for
Plaintiff's termination by EDS, and formed a portion of the
allegations which comprised Plaintiffs claim for common law
wrongful discharge.
4. Defendants thereafter timely removed this case from state
court to this Court in July 1991. The basis for the removal was
federal question jurisdiction arising from the allegations involving
ERISA, which Defendants alleged triggered the exclusive federal
jurisdiction provisions of ERISA itself.
5. Subsequent to the removal, Plaintiff in October 1991 filed
his First Amended Original Complaint under leave granted by
this court. The First Amended Original Complaint eliminated all
references to ERISA, even as a reason for Plaintiffs wrongful
termination. The First Amended Original Complaint is Plaintiffs
current live pleading.
B-3
GROUNDS FOR REMAND
6. The motion to remand is based upon the absence of
subject matter jurisdiction.
7. There is no federal question jurisdiction in this cause of
action. Plaintiff's current live pleading has eliminated all refer-
ences to ERISA, and the references to ERISA formed the basis
of the removal by Defendants from state court. Even assuming,
therefore, that Plaintiff's Original Petition properly invoked fed-
eral question jurisdiction under ERISA', that basis for federal
question jurisdiction has been eliminated and there is presently no
basis for federal question jurisdiction in this court over any aspect
of Plaintiff's claim.
8. There is similarly no other basis of federal jurisdiction over
the removed action. Plaintiff and Defendants are non-diverse,
private parties, and Plaintiff's cause of action is one brought under
state law.
9. The only remaining claims now pending before the Court,
therefore, are Plaintiff's claims for wrongful discharge and other
tortious conduct by Defendants, which are actionable under Texas
state law. This Court has jurisdiction of such claims only within
this Court’s supplemental jurisdiction under 28 U.S.C. § 1367.
However, 28 U.S.C. § 1367(c) (3) permits the Court to decline to
exercise supplemental jurisdiction if it has dismissed all claims
over which it has original jurisdiction. Plaintiff would show the
Court that since all bases for federal jurisdiction have been
eliminated by pleading amendment, this court should decline to
exercise its supplemental jurisdiction pursuant to 28 U.S.C.
§ 1367(c)(3) and (4).
' Plaintiff makes this assumption for purposes of argument only.
Piaintiff would take the position that his Original Petition did not
support removal under ERISA and that the case was improvidently
removed. However, that issue has been rendered moot by the subsequent
amendment to Plaintiff's pleadings to eliminate all ERISA references.
B-4
10. Plaintiff would show the court that the refusal of this
court to exercise supplemental jurisdiction would be particularly
appropriate under the procedural posture of this case as it pres-
ently exists. This case has been pending in federal court for only a
little over three months. The parties have conducted only written
discovery, no depositions have been taken, and there is no
immediate trial setting. Indeed, the case could probably be
reached for trial sooner in state court than in federal court, given
the crowded condition of this court’s docket. Remand at this time
of the remaining state law claims would work no hardship on any
party.
11. Further, Plaintiff would show the court that a basic
refusal to exercise supplemental jurisdiction exists under
28 U.S.C. § 1367(c)(1) because Plaintiff's claim in part raises
unsettled and important questions of Texas law. Plaintiff's wrong-
ful discharge claim is based in part upon allegations that he is
terminated for recording illegal activity committed by Crow to
EDS. The exact perimeters of this type of “whistle blower”
wrongful discharge cause of action remain unsettled under Texas
law following the decision in Winters v. Houston Chronicle
Publishing Company, 795 S.W.2d 723 (Tex. 1990). Such unset-
tled issues are best left to state courts for determination.
B-5
PRAYER
WHEREFORE, PREMISES CONSIDERED, Plaintiff
prays that this motion to remand be granted, and that this case be
remanded to the 191st District Court of Dallas County, Texas.
Respectfully submitted,
STRADLEY, SCHMIDT & WRIGHT
ONE CAMPBELL CENTRE
DALLAS, TEXAS 75206
(214) 696-4880
FAX # (214) 696-8134
BY: C. L. MIKE SCHMIDT
C. L. MIKE SCHMIDT
STATE BAR No. 17766000
ATTORNEYS FOR PLAINTIFF
CERTIFICATE OF SERVICE
I hereby certify that a true and correct copy of the foregoing
instrument has been served on all counsel of record by certified
mail, return receipt requested, this Sth day of December, 1991.
C. L. MIKE SCHMIDT
oF
. MIKE SCHMIDT
C-]
28 U.S.C. § 1367. Supplemental jurisdiction
(a) Except as provided in subsections (b) and (c) or as
expressly provided otherwise by Federal statute, in any civil action
of which the district courts have original jurisdiction, the district
courts shall have supplemental jurisdiction over all other claims
that are so related to claims in the action within such original
jurisdiction that they form part of the same case or controversy
under Article III of the United States Constitution. Such supple-
mental jurisdiction shall include claims that involve the joinder or
intervention of additional parties.
28 U.S.C. § 1447. Procedure after removal generally
* + *
(c) A motion to remand the case on the basis of any defect
in removal procedure must be made within 30 days after the filing
of the notice of removal under section 1446(a). If at any time
before final judgment it appears that the district court lacks
subject matter jurisdiction, the case shall be remanded. An order
remanding the case may require payment of just costs and any
actual expenses, including attorney fees, incurred as a result of the
removal. A certified copy of the order of remand shall be mailed
by the clerk to the clerk of the State court. The State court may
thereupon proceed with such case.
29 U.S.C. § 1002. Definitions
For purposes of this subchapter:
* + a
(7) The term “participant” means any employee or former
employee of an employer, or any member or former member of an
employee organization, who is or may become eligible to receive a
C-2
benefit of any type from an employee benefit plan which covers
employees of such employer or members of such organization, or
whose beneficiaries may be eligible to receive any such benefit.
(8) The term “beneficiary” means a person designated by a
participant, or by the terms of an employee benefit plan, who is or
may become entitled to a benefit thereunder.
o * *
(21)(A) Except as otherwise provided in subparagraph
(B), a person is a fiduciary with respect to a plan to the extent (i)
he exercises any discretionary authority or discretionary control
respecting management of such plan or exercises any authority or
control respecting management or disposition of its assets, (ii) he
renders investment advice for a fee or other compensation, direct
or indirect, with respect to any moneys or other property of such
plan, or has any authority or responsibility to do so, or (iii) he has
any discretionary authority or discretionary responsibility in the
administration of such plan. Such term includes any person
designated under section 1105(c)(1)(B) of this title.
29 U.S.C. § 1104. Fiduciary duties
(a) Prudent man standard of care
(1) Subject to sections 1103(c) and (d), 1342, and 1344 of
this title, a fiduciary shall discharge his duties with respect to a
plan solely in the interest of the participants and beneficiaries
and —
(A) for the exclusive purpose of:
(i) providing benefits to participants and their
beneficiaries; and
(ii) defraying reasonable expenses of administering
the plan;
C-3
(B) with the care, skill, prudence, and diligence under
the circumstances then prevailing that a prudent man acting
in a like capacity and familiar with such matters would use in
the conduct of an enterprise of a like character and with like
aims;
(C) by diversifying the investments of the plan so as to
minimize the risk of large losses, unless under the circum-
stances it is clearly prudent not to do so; and
(D) in accordance with the documents and instruments
governing the plan insofar as such documents and instru-
ments are consistent with the provisions of this subchapter or
subchapter III of this chapter.
29 U.S.C. § 1105. Liability for breach of co-fiduciary
(a) Circumstances giving rise to liability
In addition to any liability which he may have under any
other provision of this part, a fiduciary with respect to a plan shall
be liable for a breach of fiduciary responsibility of another
fiduciary with respect to the same plan in the following
circumstances:
(1) if he participates knowingly in, or knowingly under-
takes to conceal, an act or omission of such other fiduciary,
knowing such act or omission is a breach;
(2) if, by his failure to comply with section 1104({a) (1)
of this title in the administration of his specific responsibili-
ties which give rise to his status as a fiduciary, he has enabled
such other fiduciary to commit a breach, or
(3) if he has knowledge of a breach by such other
fiduciary, unless he makes reasonable efforts under the
circumstances to remedy the breach.
C-4
29 U.S.C. § 1109. Liability for breach of fiduciary duty
(a) Any person who is a fiduciary with respect to a plan who
breaches any of the responsibilities, obligations, or duties imposed
upon fiduciaries by this subchapter shall be personally liable to
make good to such plan any losses to the plan resulting from each
such breach, and to restore to such plan any profits of such
fiduciary which have been made through use of assets of the plan
by the fiduciary, and shall be subject to such other equitable or
remedial relief as the court may deem appropriate, including
removal of such fiduciary. A fiduciary may also be removed for a
violation of section 1111 of this title.
D-1
NO. 93-1606
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
GEORGE RAYMOND ANDERSON
Appellant,
V.
ELECTRONIC DATA SYSTEMS CORP.,
DOUGLAS M. CROW, ANTHONY E.
WEYNAND, RICHARD P. SHLAKMAN,
and DARRELL JOHNSON,
Appellees.
APPEAL FROM THE UNITED STATES
DISTRICT COURT
FOR THE NORTHERN DISTRICT OF TEXAS
DALLAS DIVISION
91-7509-M
BRIEF OF APPELLEES
PHILLIP N. SMITH, JR.
JEFFREY A. CARTER
MICHAEL A. PIAZZA
McKoor Smith, P.C.
300 Crescent Court, Suite 1500
Dallas, Texas 75201
(214) 978-4000
(214) 978-4044 (facsimile)
Attorneys for Appellees,
ELECTRONIC DATA SYSTEMS
CORPORATION, ANTHONY E.
WEYNAND, RICHARD P. SHLAKMAN,
AND DARRELL JOHNSON
Pn nee ne
D-2
CERTIFICATE OF INTERESTED PERSONS
The undersigned counsel of record certifies that the following
listed persons and entities may have an interest in the outcome of
this case. These representations are made in order that the Judges
of this Court may evaluate possible disqualification or recusal.
1. Electronic Data Systems Corporation, a subsidiary of
General Motors Corporation
2. Douglas M. Crow
3. Anthony E. Weynand
4. Richard P. Shlakman
5. Darrell Johnson
6. George Raymond (Andy) Anderson
7. Phillip N. Smith, Jr., Jeffrey A. Carter, and Michael A.
Piazza, attorneys with McKool Smith, P.C.
8. J. Thomas Scott, attorney with Electronic Data Systems
Corporation
9. John R. Woodward and Patrick Shaw, attorneys with
Woodward and Shaw
10. C. L. Mike Schmidt and Ronald Wren, attorneys with
the Law Offices of C. L. Mike Schmidt
11. Kenneth W. Biermacher, attorney with Kane, Russell,
Coleman & Logan
12. Cheryl P. Hunter and Jon W. Laasch, attorneys with
Hammons and Hunter
D-3
STATEMENT REGARDING ORAL ARGUMENT
Appellees do not request oral argument.
D-4
TABLE OF CONTENTS
——
age
CERTIFICATE OF INTERESTED PERSONS .. i D-2
STATEMENT REGARDING ORAL
Fe oe ns ohne ce bev nb iee ii D-3
TA EEE 6 dip weno vos cece eb bte seer iii D-4
pe RB ee Boles 8) | Vv D-5
STATEMENT OF JURISDICTION ............ | D-8
STATEMENT OF THE ISSUE ON APPEAL ... 2 D-8
STATEMENT OF THE CASE ................. 2 D-9
Pi, Te ee I ire eked deer éenvacds 2 D-9
B. Course of Proceedings and Disposition of
i ete O's ode os vie.e a eb 6s hs 3 D-9
(Fe ee i ban 4 D-10
SUMMARY OF THE ARGUMENT............ 13 D-20
ARETE EE seth hci el ois cia iis oe ce 16 D-22
I. THE DISTRICT COURT HAD SUBJECT 4g
MATTER JURISDICTION TO ENTER
SUMMARY JUDGMENT AGAINST
PPE kk i ss Pea on bo in 6s 16 D-22
A. The District Court Had Removal
Jurisdiction Based on Anderson’s Well
Pe es 16 D-22
1. Anderson’s Petition Raised Federal
Question Issues Under ERISA ...... 16 D-22
2. The ERISA Issues Raised By
Anderson Were Not Collateral, But
Were Critical To His Claims........ 19 D-25 -
3. Willy v. Coastal Corp. Does Not &
Support A Contrary Result ......... 21 D-26 4
B. The District Court Had Removal 4
Jurisdiction Based On The Complete -
PrOCUMGINE EPRGUIIID so iic cv cccccccdccees 25 D-31 z
1. The Complete Preemption Doctrine
Applied to Anderson’s Suit ......... 25 ~D-31 4
2. Anderson’s Claim Was Preempted by =
cbinxGs i0c cede sas hare es 30 D-36 :
3. Anderson’s Claim Was Removable f
I inc cea tab ah'y es he ane 37 ~D-42 ¢
C. The District Court Had Original 7
Jurisdiction at the Time of Judgment..... 39. D-44 |
CO a ee kt ne rcicekhchseveeresedesswn 45 D-49 id
CEM EMPCAAS TS OP SEI VICE 6. cv sccecsbescas 48 D-51
uv sf
v
§
APPENDIX
wer
SETTERS ELIS Re A TRS Rho eR RU RT RRR at cl “DAR RRATEEE ay GRA eer a
D-5
TABLE OF AUTHORITIES
CASES
Aaron v. National Union Fire Ins. Co. of Pittsburg, 876
F.2d 1157 (Sth Cir. 1989), cert. denied, 110 S. Ct. 1121
“eee eee eeeeenweewee eee eee eee
American Fire & Casualty Co. v. Finn, 71 S. Ct. 534
EL SEIS 41, 42
Avco Corp. v. Machinists, 88 S. Ct. 1235 (1968) ........... 26, 27
Baris v. Suipicio Lines, Inc., 932 F.2d 1540 (Sth Cir.),
cert. denied, 112 S. Ct. 430 (1991)......... 15, 40, 42, 43, 44, 45
Brown v. Southwestern Bell Telephone Co., 901 F.2d 1250
EE EE EE 11
In re Carter, 618 F.2d 1093 (Sth Cir. 1980), cert. denied,
ee 11, 12
Christopher v. Mobil Oil Corp., 950 F.2d 1209 (Sth Cir.
1992), cert. denied, 113 S. Ct. 68 (1992) ......... 24, 31, 32, 34
Corcoran v. United Healthcare, Inc., 965 F.2d 1321
(Sth Cir.), cert. denied, 113 S. Ct. 812
EI EMEEGs inked oa chsbceucesecsses 31, 32, 34, 37, 38
District of Columbia v. Greater Washington Board of Trade,
ee ee ew eccesscers 32
Franchise Tax Board of Cal. v. Construction Laborers Vacation
Trust of Southern Cal., 103 S. Ct. 2841 (1983) ............ 16
Griffith v. Johnston, 899 F.2d 1427 (Sth Cir. 1990) ........... 38
Grubbs v. General Electric Credit Corp, 92 S. Ct. 1344
ERO SB eee eet Tree eee 14, 40, 41, 42, 44
Gully v. First Nat'l Bank in Meridian, 57 S. Ct. 96 (1936) .. 16, 19
Hansen v. Continental Ins. Co., 940 F.2d 971
TE ETT PCT LETTE T ETE Te 38, 39
Ingersoll-Rand Co. v. McClendon, 111 S. Ct. 478
20, 21, 24, 25 31, 32, 33, 34, 35, 36
D-6
TABLE OF AUTHORITIES - Continued
Page
Iron Workers Mid-South Pension Fund v. Terotechnology
Corp., 891 F.2d 548 (Sth Cir.), cert. denied, 110 S. Ct. 3272
CROPS FA as bade cheese nonce Hol 31, 37
Jones v. Petty-Ray Geophysical, Geosource, Inc., 954 F.2d 1061
OP SS EN eos SSE rei cane hale be ie suceleele a. 44
Kidd v. Southwest Airlines, Co., 891 F.2d 540
ee I hiss is ee 15, 16, 40, 41, 42
Kliebert v. Upjohn Co., 915 F.2d 142 (3h Ce, 190)... ....... 4]
Mackey v. Lanier Collection Agency & Service, 108 S. Ct. 2182
ctinay een ae ce TT Ora dR 3]
McLean v. Carlson Companies, Inc. 777 F. Supp. 1480
OR as cde 20, 29, 36
Memorial Hospital System v. Northbrook Life Ins. Co.,
er ae ee Oe Ge PD os. ne 39
Metropolitan Life Ins. Co. y. Taylor, 107 S. Ct. 1542
(eRe stb cutee gle ee 14, 16, 25, 26, 27 28, 29, 37
NLRB vy. Scrivener, 92 S. Ct. 798 ES RI, asi ia si: 30
Nowoc v. Rheem Mfg. Co., 772 F. Supp. 977 (S.D. Tex.
Vickie GEEAAE TE) Creer he ep een a aS 24, 25
Pease v. Pakhoed Corp., 980 F.2d 995 (Sth Cie. 1993)......... 17
Pilot Life Ins. Co. v. Dedeaux, 107 S. Ct. 1549
GOD ierciGina secur eee 24, 27, 30, 31, 32, 34, 35
Rayner v. Smirl, 873 F.2d 60 oe | Res ee 30
Richardson v. United Steelworkers of America, 864 F.2d 1162
(Sth Cir. 1989), cert. denied, 110 S. Ct. 2204 i ee 26
Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733
iinet cantante oO Sas ae 12, 13, 17, 18
Shaw v. Delta Air Lines, 103 S. Ct. Pe Ce sd ioe 31, 34
Sperling v. Texas Health Enterprises, Inc., 791 F. Supp. 662
re MN Ms aiisac leek oitee ssl ccu, ine 24, 25
St. Paul Mercury Indemnity Co. v. Red Cab Co., 58 S. Ct. 586
sides ARE TEENS OT ET eT ORS 1]
D-7
TABLE OF AUTHORITIES - Continued
Page
Winters v. Houston Chronicle Publishing Co., 795 S.W.2d 723 :
iy SRN Sears Mitac oars cans Aaa i ee 17, 18
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D-8
STATEMENT OF JURISDICTION
The Appellees removed this case from Texas state court to
the United States District Court for the Northern District of
Texas, pursuant to 28 U.S.C. § 1441. Removal was based on
allegations in the Original Petition that Appellant George Ray-
mond Anderson (“Anderson”) had been wrongfully terminated
because he refused to violate the Employee Retirement Income
Security Act. At the time of removal, the district court had
subject matter jurisdiction pursuant to 28 U.S.C. § 1331. At the
time the district court entered summary judgment for Electronic
Data Systems Corp. (“EDS”), it had subject matter jurisdiction
pursuant to 28 U.S.C. §§ 1331 and 1332.
This Court has jurisdiction of Anderson’s appeal as to EDS,
pursuant to 28 U.S.C. § 1291. The district court entered final
judgment on June 4, 1993. As discussed in the accompanying
Motion to Dismiss Appeal, this Court does not have jurisdiction
over the other named appellees. Anderson voluntarily dismissed
the other appellees in April 1993.'
STATEMENT OF THE ISSUE ON APPEAL
Did the United States District Court for the Northern
District of Texas have subject matter jurisdiction when it entered
summary judgment in favor of EDS on Anderson’s claim for
wrongful discharge?
' In the event this Court denies the motion of Anthony E. Wey-
nand, Richard P. Shlakman, and Darrell Johnson to dismiss this appeal
as to them, this Brief is filed on their behalf as well as on behalf of EDS.
By joining in this Brief, Messrs. Weynand, Shlakman, and Johnson do
not intend to waive or forego any rights they might have to the dismissal
of this appeal as to them.
D-9
STATEMENT OF THE CASE
A. Nature of the Case.
Appellant George Raymond Anderson (“Anderson”), an
employee at-will under Texas law, alleges that Appellee Elec-
tronic Data Systems Corporation (“EDS”) wrongfully termi-
nated him for refusing to commit illegal acts requested of him by
his supervisor and for accusing his supervisor of committing
certain improper acts. In his Original Petition, Anderson, inter
alia, alleged that his supervisor asked him to violate the Em-
ployee Retirement Income Security Act (“ERISA”) and that his
refusal to violate ERISA led to his termination.
Anderson filed this action originally in state court against
EDS and others (collectively, the “Defendants”). The Defend-
ants removed to federal court. Anderson voluntarily dismissed all
Defendants, but EDS. EDS obtained summary judgment on
Anderson’s claims. On appeal, Anderson does not challenge the
propriety of the court’s summary judgment ruling. Instead, he
challenges the district court’s denial of his motion to remand the
case to state court. The only issue before this Court is whether the
district court had subject matter jurisdiction to enter summary
judgment in favor of EDS.
B. Course of Proceedings and Disposition of Case.
On June 26, 1991, Anderson filed suit in state court in Dallas
County against EDS, and four present or former EDS employees,
Douglas M. Crow (“Crow”), Anthony E. Weynand (“Wey-
nand”), Richard P. Shlakman, and Darrell Johnson.’ On July 25,
2 Plaintiff's Original Petition {| 1 (hereinafter “Original Petition”)
(R. 92-104). The unsealed portions of the record are cited in this brief
by referring to the page number of the record as follows: "us See
sealed portions of the record are identified by asterisks on the docket
sheet and are cited in this brief as “R. Sealed” along with reference to
the document’s docket number and date filed.
D-10
1991, the Defendants joined in removing the case to the Northern
District of Texas, Dallas Division.’
Anderson filed his first amended complaint in October 1991
and purportedly dropped all references to ERISA. In Novem-
ber 1991, Defendant Crow moved for summary judgment. In
December 1991, in conjunction with filing his response to Crow’s
motion for summary judgment, Anderson moved to remand the
case to Texas state court. The District Court denied Anderson’s
remand motion on January 7, 1992. After two extensions re-
quested by Anderson, the district court granted Crow’s motion for
summary judgment in December 1992.
In April 1993, Anderson filed a second amended complaint.
He voluntarily dismissed all Defendants except EDS and dis-
missed all claims against EDS except for his claim of wrongful
termination. After briefing, the district court granted EDS’ mo-
tion for summary judgment on the remaining claim in June 1993.
Anderson appealed. He now challenges the district court’s
refusal to remand the case to state court. He does not, however,
appeal either of the court’s summary judgment rulings.
C. Statement of Facts.
Anderson joined the Domestic Treasury Department of EDS
in October 1984 as a cash manager.* Subsequently, Anderson
> Notice of Removal (R. 1-5). Anderson admitted in his “Motion
to Remand” that the Defendants timely removed this case from state
court. Motion to Remand p. 2, dated December 5, 1991 (R. 300). His
argument on appeal is limited solely to whether the district court had
subject matter jurisdiction.
* Original Petition | IV (R. 94-95); Second Amended Complaint
q 5 (R. 673); Anderson Deposition at pp. 24, 27-28 (R. Sealed, Docket
Numbers 71-75, Filed May 4, 1993, Anderson Deposition Excerpts
attached to Affidavit of Michael A. Piazza). At the time Anderson
joined EDS, he signed an employment agreement which provided that
either Anderson or EDS could terminate the employment relationship at
D-11
became the Department’s Manager of Investments and Debt.
According to Anderson, he was responsible for all domestic long
and short-term investments for all of the investment portfolios of
EDS, including EDS’ pension funds.? Until January 1989,
Anderson reported to Crow, the assistant treasurer of EDS.°
In January 1989, Crow developed a plan to reorganize the
Domestic Treasury Department. Anderson believed that he was
being demoted under the proposed plan and complained to
Weynand, Crow’s boss.’ Shortly after he went to Weynand,
Weynand told Crow to drop his plan and informed Anderson that
the reorganization proposed by Crow would not be implemented.*
any time, with or without cause. Anderson Deposition at pp. 24-25;
Employment Agreement {| 7 (R. Sealed, Docket Numbers 71-75, Filed
May 4, 1993, Anderson Deposition Excerpts and Exhibit B attached to
Affidavit of Michael A. Piazza).
> Original Petition IV (R. 94-95); Second Amended Complaint
q 5 (R. 673).
® Original Petition VII (R. 96-97); Second Amended Complaint
| 7 (R. 673-674); Anderson Deposition at p. 19 (R. Sealed, Docket
Numbers 71-75, Filed May 4, 1993, Anderson Deposition Excerpts
attached to Affidavit of Michael A. Piazza).
” Second Amended Complaint ff 7, 14, and 15 (R. 673-674, 676-
677); Anderson Deposition at pp. 141-43, 146-47, and 149-50
(R. Sealed Docket Numbers 71-75, Filed May 4, 1993, Anderson
Deposition Excerpts attached to Affidavit of Michael A. Piazza);
Affidavit of Anthony E. Weynand (“Affidavit of Weynand”) {| 6
(R. Sealed, Docket Numbers 71-75, Filed May 4, 1993).
Anderson also complained to Weynand’s boss, Davis Hamlin
(“Hamlin”). Second Amendment Complaint Jf 7, and 15 (R. 673-674,
676-677); Anderson Deposition at pp. 146-147, and 149-50 (R. Sealed,
Docket Numbers 71-75, Filed May 4, 1993, Anderson Deposition
Excerpts attached to Affidavit of Michael A. Piazza).
® Affidavit of Weynand § 6 (R. Sealed, Docket Numbers 71-75,
Filed May 4, 1993).
D-12
Based on his conversation with Anderson and with other
Domestic Treasury employees, Weynand decided to reassign
Crow. In Weynand’s judgment Crow could no longer effectively
manage the Domestic Treasury Department.” Weynand assigned
Crow to a position outside the Department and in another
building.'°
Weynand named Don Ulm (“Ulm”) to replace Crow as the
assistant treasurer and placed Ulm in charge of the Domestic
Treasury Department.'’ Ulm had not worked in the Domestic
Treasury Department nor had he ever discussed Anderson with
anyone before being named assistant treasurer.’
* Id. at § 7 (R. Sealed, Docket Numbers 71-75, Filed May 4,
1993).
'° Second Amended Complaint § 15 (R. 676-677); Anderson
Deposition at p. 153 (R. Sealed, Docket Numbers 71-75, Filed May 4,
1993, Anderson Deposition Excerpts attached to Affidavit of Michael A.
Piazza); Affidavit of Weynand 7 (R. Sealed, Docket Numbers 71-75,
Filed May 4, 1993).
During his conversations with Weynand and Hamlin, Anderson
accused Crow of improper and unethical conduct. Original Petition
q9 XI, XII (R. 99-100); Second Amended Complaint §§ 13,15
(R. 676-677).
Weynand and Hamlin investigated Anderson’s accusations
against Crow, but uncovered no evidence of wrongdoing on the part of
Crow. Affidavit of Weynand § 7 (R. Sealed, Docket Numbers 71-75,
Filed May 4, 1993); Second Amended Complaint § 15 (R. 676-677).
'' Second Amended Complaint § 15 (R. 676-677); Anderson
Deposition at p. 154 (R. Sealed, Docket Numbers 71-75, Filed May 4,
1993, Anderson Deposition Excerpts attached to Affidavit of Michael A.
Piazza); Affidavit of Weynand J 7 (R. Sealed, Docket Numbers 71-75,
Filed May 4, 1993). Anderson did not name Ulm as a defendant.
'? Affidavit of Don Ulm (“Affidavit of Ulm”) 9 5 (R. Sealed,
Docket Numbers 71-75, Filed May 4, 1993).
Neither Crow, Anderson, Weynand, not anyone else at EDS
informed Ulm of Anderson’s accusations against Crow. /d. at 9] 10-12
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D-13
In August 1989, based on his experience in supervising
Anderson since January 1989, Ulm concluded that Anderson was
a poor manager and exercised poor judgment.'* Ulm believed that
Anderson too often treated his employees, and the vendors and
brokers doing business with the Domestic Treasury Department,
rudely and in an unprofessional manner.'* He further believed
that Anderson’s behavior was inappropriate as a manager and
representative of EDS.'° Ulm terminated Anderson on August 23,
1989."°
(R. Sealed, Docket Numbers 71-75, Filed May 4, 1993); Affidavit of
Weynand § 8 (R. Sealed, Docket Numbers 71-75, Filed May 4, 1993);
Anderson Deposition at p. 155 (R. Sealed, Docket Numbers 71-75,
Filed May 4, 1993, Anderson Deposition Excerpts attached to Affidavit
of Michael A. Piazza).
'> Affidavit of Ulm 9 6 (R. Sealed, Docket Numbers 71-75, Filed
May 4, 1993).
'* Id. (R. Sealed, Docket Numbers 71-75, Filed May 4, 1993).
'S Id. (R. Sealed, Docket Numbers 71-75, Filed May 4, 1993).
'© Id. at 9 9 Id. (R. Sealed, Docket Numbers 71-75, Filed May 4,
1993); Anderson Deposition at p. 28 (R. Sealed, Docket Numbers 71-
75, Filed May 4, 1993, Anderson Deposition Excerpts attached to
Affidavit of Michael A. Piazza).
Ulm’s decision to terminate Anderson was his own. No one at EDS
instructed him to, requested him to, or suggested to him that he
terminate Anderson. Affidavit of Ulm at 99 7-9 (R. Sealed, Docket
Numbers 71-75, Filed May 4, 1993); Affidavit of Weynand at 79 (R
Sealed, Docket Numbers 71-75, Filed May 4, 1993).
Anderson alleged that Crow was involved in his termination. In
ruling on Crow’s motion for summary judgment, the district court,
however, found that Anderson had failed to produce any evidence of
Crow’s involvement. Memorandum Order dated December 2, 1992, p. 4
(R. 634).
Subsequently, Anderson admitted that he had no factual basis to
support his claim that Crow was involved in his termination nor any
evidence to dispute Ulm’s testimony that Ulm alone made the decision
to terminate Anderson. Anderson Deposition at pp. 120-23, 185-86 (R.
Sealed, Docket Numbers 71-75, Filed May 4, 1993, Anderson Deposi-
D-14
On June 26 1991, Anderson sued the Defendants in state
court in Dallas County, Texas. In his Original Petition, Anderson
alleged that EDS breached its employment agreement with him
by wrongfully discharging him."
Specifically, Anderson contended that he was terminated
because (i) he refused to participate in illegal activities requested
by Crow, (ii) he reported Crow’s illegal or irregular performance
of his duties to EDS management, and (iii) his accusations
against Crow embarrassed the management of EDS."* Anderson
listed four allegedly illegai acts that he claimed Crow asked him
to do, two of which involved alleged violations of ERISA."
Anderson alleged that Crow asked him:
tion Excerpts attached to Affidavit of Michael A. Piazza).
In addition, Ulm’s uncontradicted testimony was that he did not
terminate Anderson because Anderson refused to perform illegal acts
that Crow allegedly asked him to perform. He was not aware of
Anderson’s allegations in this regard when he terminated Anderson.
Affidavit of Ulm {J 10-12 (R. Sealed, Docket Numbers 71-75, Filed
May 4, 1993).
Anderson never alleged that Ulm or anyone other than Crow ever
requested him to perform illegal acts. He also never alleged any
wrongdoing on the part of Ulm. Anderson Deposition at p. 244
(R. Sealed, Docket Numbers 71-75, Filed May 4, 1993, Anderson
Deposition Excerpts attached to Affidavit of Michael A. Piazza).
'’ Original Petition {| XVI (R. 101-102). He also alleged that all
of the Defendants had intentionally interfered with his prospective
business and contractual relationships and had negligently or intention-
ally inflicted emotional distress on him. Jd. J XVII and XVIII
(R. 102).
'® Original Petition ] XIII (R. 100).
'? Original Petition VII (R. 96-97).
Anderson also alleged that Crow asked him (i) not to provide
certain stock certificates needed to close an acquisition by EDS, which
Anderson alleged violated “various laws and regulations p: »mulgated
and enforced by the Federal Securities and Exchange Commission,” and
(ii) to under-report to EDS senior management the interest income he
D-15
to sign on two separate occasions approval of payment
invoices on behalf of the pension portfolios under his man-
agement and supervision who (sic) had been retained by
Crow without approval of the pension trustees. Such action
would have been a violation of the Federal Employee Retire-
ment Income Security Act of 1974 (“Erisa”’) Laws gov-
erning management of such pension plans.
* * *
to write up minutes for meetings which he did not attend in
connection with the EDS Retirement Plan. This also is in
violation of ERISA.”°
was projecting EDS would make on one of its accounts used as a
repository for interest income generated by EDS’ investments. Anderson
did not allege what law he would have violated if he had under-reported
the projected income. Jd. (R. 96-97) (emphasis added).
0 Id. at 9 VII (R. 96-97) (emphasis added).
In answers to interrogatories served after the case was removed,
Anderson further described the conduct Crow allegedly asked him to do
in violation of ERISA: (i) to approve invoices for the payment of a
consultant, from the funds of EDS’ retirement plan, even though the
trustees of the retirement plan had not approved hiring the consultant
and (ii) to draft minutes for meetings of the trustees of the retirement
plan, meetings which Anderson had not attended. Anderson stated that
he refused to sign the invoices or draft the minutes and told Crow that
both would constitute violations of ERISA. Plaintiff's Responses to
Douglas M. Crow’s Interrogatories (August 1, 1991), Answer to Inter-
rogatory 5 (hereinafter “Anderson Interrogatory Answer __”) (Vol-
ume 4 of the Record, R. 53-55, Exhibit to Crow’s Brief in Support of
Motion for Summary Judgment).
Anderson also answered that Crow violated ERISA (i) by asking
Anderson to write the meeting minutes and (ii) by hiring a consultant to
work on projects for EDS’s retirement plan without trustee approval.
Anderson Interrogatory Answer 11 (Volume 4 of the Record, R. 58-60,
Exhibit to Crow’s Brief in Support of Motion for Summary Judgment).
Anderson also identified five people with knowledge f either the
“EDS Retirement Plan,” “authorizing payment of invoices without
budget approval/trustee approval,” or “problems associated with the
401(k) and EDS Retirement Plan.” Anderson Interrogatory Answer |
D-16
Anderson further alleged that when he refused to do the acts
requested by Crow, Crow either did them himself or forced
someone else to do them.”' Anderson also alleged that Crow
threatened him on three separate occasions after he refused to
commit the illegal acts.” In addition, Anderson alleged that Crow
and Weynand “actively sought occasion to discriminate against
and ultimately terminate” him because he refused to commit the
illegal acts and because of his accusations against Crow.”
On July 25, the Defendants jointly removed the case to
federal court.“* The Defendants maintained that Anderson’s alle-
gations that he was terminated because he refused to violate
provisions of ERISA gave the district court subject matter
jurisdiction.”
In October 1991, Anderson filed his First Amended Original
Complaint.” In his amended complaint, Anderson purported to
drop all reference to the ERISA violations.
Anderson moved to remand the case to Texas state court in
December 1991.”’ In his motion, Anderson explained that part of
his job involved the administration of EDS’ pension and profit
(Volume 4 of the Record, R. 44-51, Exhibit to Crow’s Brief in Support
of Motion for Summary Judgment).
2! Original Petition | VIII (R. 97).
2 Id. (R. 97).
3 Id. at XI (R. 99). Anderson later dropped this allegation. See
Plaintiff's Second Amended Complaint ff 12-15 (R. 675-677).
* Notice of Removal (R. 1-5)
> Id. (R. 1-5)
© Plaintiff's First Amended Original Complaint dated October 21,
1991 (R. 187-200).
27 Motion to Remand dated December 5, 1991 (R. 299-303).
D-17
sharing plans.” He admitted that certain of the illegal activities
Crow directed him to perform would have violated ERISA had
he performed them.” He further admitted that his “Original
Petition alleged that his refusal to perform violations of ERISA as
a plan administrator was a reason in whole or in part for his
termination.” Anderson additionally admitted that “[t]he re-
fusal of Plaintiff to violate ERISA was pled merely as one of the
improper reasons for Plaintiff's termination by EDS, and formed
a portion of the allegations which comprised Plaintiff's claim for
common law wrongful discharge.”*' Anderson maintained, how-
ever, that his ERISA allegations did not give the district court
federal question jurisdiction.”
The Defendants responded and argued that removal was
proper under the Original Petition and that Anderson could not
defeat the district court’s jurisdiction by amending his complaint
8 Jd. at p. 2 (R. 300).
° Id. (R. 300).
© Id. (R. 300).
*' Id. at p. 2 (R. 300) (emphasis added).
2 Id. at p. 3 (R. 301). Alternatively, Anderson argued that the
Defendants’ removal had been predicated on the references to ERISA in
the Original Petition, that he had “eliminated all references to ERISA”
in his First Amended Original Petition,” and that the “issue ha[d] been
rendered moot by the subsequent amendment to Plaintiff's pleadings t-
eliminate all ERISA references.” Id. at p. 3 and n. | (R. 300-301).
Finally, Anderson admitted that the district court had supplemental
jurisdiction of the case under 28 U.S.C. § 1367, but urged the court to
decline that jurisdiction based on the fact that “all bases for federal
jurisdiction ha[d] been eliminated by the pleading amendment.” /d. at
p. 4 (R. 302).
D-18
to delete the basis for federal jurisdiction.** The district court
denied Anderson’s motion to remand on January 7, 1992.*4
In November 1992, counsel for Anderson wrote a letter to
defense counsel reciting an agreement between counsel that
Anderson intended to file an amended complaint and dismiss the
individual defendants from the case. Counsel for Anderson fur-
ther represented that Anderson would “not be making any
ERISA claims” in the new amended pleading.*°
In April 1993, Anderson filed his Second Amended Com-
plaint.*° In that complaint, Anderson dismissed all claims against
all of the Defendants except EDS and dismissed all claims against
EDS except for wrongful termination based on his refusal to
commit illegal acts and his accusations against Crow.””
> Defendants’ Response to Plaintiff's Motion to Remand pp. 4-8,
dated December 30, 1991 (R. 322-326). See, e.g., St. Paul Mercury
Indemnity Co. v. Red Cab Co., 58 S.Ct. 586, 593 (1938) (after filing
petition over which federal court has original jurisdiction, plaintiff can
not, at his election, subsequently act to defeat that jurisdiction or
defendant’s right to remove); Brown v. Southwestern Bell Telephone
Co., 901 F.2d 1250, 1255 (Sth Cir. 1990) (federal court’s should guard
against forum shopping when plaintiff deletes his federal claims and
then requests the court to remand the case); Jn re Carter, 618 F.2d 1093,
1101 (Sth Cir. 1980), cert. denied, 101 S.Ct. 1410 (1981) (“the plaintiff
cannot rob the district court of subject matter jurisdiction by electing to
amend away the grounds for federal jurisdiction.”).
** Order dated January 7, 1992 (R. 331).
*> Letter from C. L. Schmidt, attorney for Anderson, to Phillip N.
Smith, Jr., attorney for all of the named Defendants but Crow, dated
November 16, 1992 (R. Sealed, Docket Numbers 71-75, Filed May 4,
1993, Exhibit “D” to Affidavit of Michael A. Piazza).
*© Second Amended Complaint filed April 13, 1993 (R. 672-679).
7 Td. (R. 672-679). In his motion for leave to file the Second
Amended Complaint, Anderson expressly asked for leave to dismiss his
claims against each of the individual defendants. Motion for Leave to
D-19
After Anderson dropped his ERISA based claims, EDS
moved for summary judgment based on the remaining claims
against it. EDS argued that as a matter of law (i) Anderson was
an employee-at-will who could be discharged for no cause,
(ii) Anderson did not fall within the Sabine Pilor® exception to
the employment-at-will doctrine, and (iii) Anderson’s claim that
he was terminated for reporting the illegal or irregular conduct of
Crow did not state a cause of action for wrongful termination or
anything else under Texas law.”
The district court granted summary judgment. It found that
Texas did not recognize a “whistle blower” cause of action under
the facts alleged by Anderson. The court further found that
Anderson was an employee-at-will who failed to meet the require-
ments of the Sabine Pilot exception.” The court entered judg-
File Plaintiff's Second Amended Complaint p. 2, dated March 5, 1993
(R. 647).
After filing the Second Amended Complaint, counsel for Anderson
and EDS had the following colloquy at Anderson’s deposition regarding
Anderson’s ERISA claims:
Mr. Smith: Mike, let me, on the record here, make sure that
my understanding is correct... ERISA in any
form or fashion is out of the case?
Mr. Schmidt: Yes. We have amended it out of the case. Anderson
Deposition at p. 112 (R. Sealed, Docket Numbers 71-75, Filed May 4,
1993, Anderson Deposition excerpts attached to Affidavit of Michael A.
Piazza).
8 Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d 733 (Tex. 1985)
(recognized a cause of action when an employee is fired solely because
he refused to commit a criminal act).
Defendant's Brief in Support of Motion for Summary Judgment
dated May 4, 1993 (R. Sealed, Docket Numbers 71-75, Filed May 4,
1993).
“ Memorandum Order pp. 5-8, dated June 4, 1993 (R. 705-708).
D-20
ment for EDS, concluding all issues as to all parties.*' This appeal
then ensued.
SUMMARY OF THE ARGUMENT
The district court had subject matter jurisdiction to enter
summary judgment in favor of EDS and against Anderson on
three separate grounds. One, under the well pleaded complaint
rule, Anderson’s Original Petition raised issues of federal law
which created federal question jurisdiction. Anderson claimed
that he was terminated because he refused to do certain acts that
would have violated ERISA. For Anderson to succeed on his
claim, the court would have had to determine whether an ERISA
covered benefit plan was involved and whether the acts Anderson
was requested to do would in fact have violated ERISA or the
terms of an employee benefit plan covered by ERISA. The
decision in Ingersoll-Rand Co. v. McClendon teaches that these
ERISA related issues are critical to a wrongful discharge claim
based on alleged violations of ERISA.
Two, the district court also had federal question jurisdiction
under the complete preemption doctrine. In Metropolitan Life
Ins. Co. v. Taylor, the Supreme Court extended the doctrine to
any state law cause of action that falls within the scope of the civil
enforcement provisions of ERISA, 29 U.S.C. § 1132(a). Ander-
son’s claim falls within the scope of ERISA’s civil enforcement
scheme, which includes enforcement of ERISA’s provisions con-
cerning the administration of covered plans and the enforcement
of the fiduciary duties created by ERISA. Anderson alleged facts
indicating that he served as a plan manager, administrator, and
fiduciary. Anderson claims that in his role managing and adminis-
tering EDS’ ERISA plans, he was requested to violate ERISA
and that when he refused, his supervisor either committed the
violation or forced someone else to commit it. Anderson’s claims
*' Judgment dated June 4, 1993 (R. 709).
D-21
fall within the scope of section 1132. For example, as a partici-
pant, beneficiary, or fiduciary of an ERISA covered plan, Ander-
son could have brought suit under section 1132(a) to enjoin any
violation of ERISA, an ERISA plan, or his rights under ERISA
or an ERISA plan.
Three, the district court also had original subject matter
jurisdiction at the time it entered summary judgment in favor of
EDS. The Supreme Court decision in Grubbs v. General Electric
Credit Corp. and this Circuit’s decisions in Baris v. Sulpicio Lines,
Inc. and Kidd v. Southwest Airlines provide that when a case is
improvidently removed and tried on the merits either without
objection by the plaintiff or after the plaintiff has waived his right
to object, the test for determining jurisdiction is whether the
district court would have had original jurisdiction over the case if
the plaintiff had chosen to bring it in federal court. This determi-
nation is made based on the facts, pleadings, and record as they
existed at the time of judgment. By failing to file his motion to
remand in a timely manner, as required by 28 U.S.C. § 1447(c),
Anderson waived his right to oppose the removal. At the time the
district court entered summary judgment for EDS, it had original
subject matter jurisdiction based on the diversity of the parties.
Anderson admitted in his deposition taken less than two months
before the judgment that he was living and working in Oklahoma
City, Oklahoma, and that he had been working in Oklahoma City
continually at the same job since before he filed suit. EDS was a
Texas resident.
D-22
ARGUMENT
I. THE DISTRICT COURT HAD SUBJECT MATTER
JURISDICTION TO ENTER SUMMARY JUDGMENT
AGAINST ANDERSON.
A. The District Court Had Removal Jurisdiction Based on
Anderson’s Well Pleaded Petition.
1. Anderson’s Petition Raised Federal Question Issues
Under ERISA.
A defendant may remove to federal court any civil action
over which the federal courts have original jurisdiction founded
on a claim or right arising under federal law.” For purposes of
removal, a civil action arises under federal law when “the vindica-
tion of a right under state law necessarily turns upon some
construction of federal law’ or when the action requires the
resolution of a substantial question of federal law.“
_In determining whether a cause of action arises under federal
law, courts apply the “well-pleaded complaint” rule. The rule
provides that a cause of action arises under federal law only when,
at the time of removal, the plaintiff's well-pleaded complaint
raises issues of federal law or discloses a federal controversy.*°
Anderson’s Original Petition, the pleading upon which re-
moval was based, raised issues of federal law — issues that would
have to be resolved for him to succeed on his claim. Anderson has
*? 28 U.S.C. § 1441(a) and (b). See, e.g., Metropolitan Life Ins.
Co. v. Taylor, 107 S. Ct. 1542, 1546 (1987).
* Kidd v. Southwest Airlines, Co., 891 F.2d 540, 542 (Sth Cir.
1990).
“ Franchise Tax Board of Cal. v. Construction Laborers Vacation
Trust for Southern Cal., 103 S. Ct 2841, 2845-46, 2856 (1983).
*° Metropolitan Life Ins. Co. v. Taylor, 107 S. Ct. at 1546; Gully v.
First Nat'l Bank in Meridian, 57 S. Ct. 96, 98 (1936).
D-23
admitted that he was an employee-at-will. Under Texas law, an
employee-at-will can be terminated at any time for any or no
reason.*’ The Texas supreme court announced the only common
law exception to the Texas employee-at-will doctrine in Sabine
Pilot: an employee could not be lawfully terminated solely be-
cause he refused his employer’s request to commit an illegal act.”
In his Original Petition, Anderson alleged that he was
discharged “from his position of employment at EDS because of,
and in retaliation for, [his] refusal to commit illegal activities at
Crow’s request ....’*? Anderson alleged specifically that Crow
retained a consultant to do certain work on behalf of EDS’s
retirement plan without obtaining the approval of the trustees of
the plan, and then asked Anderson to approve the consultant’s
invoice for payment, again without trustee approval. According to
Anderson “[s]uch action would have been a violation of the
Federal Employee Retirement Income Security Act of 1974
“ See Plaintiff's Brief in Opposition to Motion for Summary
Judgment of Defendant Electronic Data Systems Corp. p. 4, dated
May 25, 1993 (hereinafter “Anderson Summary Judgment Brief at ”)
(R. Sealed, Docket Numbers 79-80, Filed May 25, 1993).
Anderson further admitted in response to EDS’ summary judgment
motion that for him to have a cause of action based on his discharge, he
had to establish a Sabine Pilot exception to the employment-at-will
doctrine. Jd. at 4-5 (R. Sealed, Docket Numbers 79-80, Filed May 25,
1993).
*” See, e.g. Pease v. Pakhoed Corp., 980 F.2d 995, 1000 (Sth Cir.
1993) (“In Texas, the employment-at-will doctrine is well settled and
mandates that a worker may be terminated without cause and at the will
of either party.”); Winters v. Houston Chronicle Publishing Co., 795
S.W.2d 723, 723 (Tex. 1990) (“The long standing rule in Texas is that
employment for an indefinite term may be terminated at will and
without cause.”’).
© Sabine Pilot Service, Inc. v. Hauck, 687 S.W.2d at 735.
* Original Petition { XVI (R. 101-102).
D-24
..”° Anderson further alleged that Crow asked him to “write
up” minutes of the meetings of the trustees of the retirement plan,
meetings that Anderson had not attended. Anderson alleged that
“[t]his also is in violation of ERISA.”*'
For Anderson to succeed under Sabine Pilot, not only did
Anderson have to be able to show that he was terminated solely
because he refused to commit the acts requested by Crow, but
also that the acts requested were illegal.’ This latter showing
would have required the parties and the court to review, interpret,
and apply ERISA law. Put another way, in order for Anderson to
vindicate his rights, the district court would have had to
(i) determine whether the plan or plans to which Anderson was
referring were covered by ERISA, and, if so, (ii) construe
ERISA and the relevant plan or plans to determine if approval of
the invoices or preparation of the minutes would have violated
either ERISA or the plans. The need for that inquiry raised a
federal question.”
°° Id. § VII (R. 96-97).
*! Id. (R. 96-97).
* Sabine Pilot Services, Inc. v. Hauck, 687 S.W.2d at 735 (“it is
the plaintiff's burden to prove by a preponderance of the evidence that
his discharge was for no reason other than his refusal to perform an
illegal act.”). See Winters v. Houston Chronicle Publishing Co., 795
S.W.2d 723, 724 (Tex. 1990) (employee must be put in the position of
having to choose between continued employment and risking criminal
liability).
*> Anderson’s pleadings also support the propriety of the removal
and the district court’s refusal to remand the case. In his Motion to
Remand, Anderson admitted that the allegations that he was wrongfully
terminated for refusing to violate ERISA comprised a portion of his
claim. Motion to Remand at p. Z (R. 300).
In his August 1991 answers to interrogatories, Anderson reinforced
the fact that his claims raised issues under ERISA. He clarified his
accusations that Crow asked him to violate ERISA, accused Crow of
D-25
2. The ERISA Issues Raised By Anderson Were Not Collat-
eral, But Were Critical To His Claims.
Anderson argues that his wrongful discharge claim is based
solely on Texas state law and that ERISA is purely collateral and
incidental to his claim. The Supreme Court rejected a similar
argument in Ingersoll-Rand Co. v. McClendon.*°
McClendon claimed that his employer discharged him to
avoid having to make contributions to his pension fund. He sued
his employer, Ingersoll-Rand, in Texas state court for wrongful
termination. The Texas supreme court ruled that McClendon
could recover for wrongful discharge if he proved that the princi-
pal reason for his termination was his employer’s desire to avoid
contributing to, or paying benefits under, an employee benefit
plan.*’ The United States Supreme Court found ERISA to be an
integral part of McClendon’s wrongful discharge action.
The Court held that “the existence of a pension plan is a
critical factor in establishing liability under the State’s wrongful
violating ERISA, and identified people with knowledge of the accusa-
tions. See supra. note 20.
The well-pleaded complaint rule instructs a court not to be per-
suaded when making its determination by either the defenses the
plaintiff may be anticipating in its complaint or the notice of removal
filed by the defendant. See Gully v. First Nat'l Bank in Meridian, 57
S.Ct. 96, 98 (1936). The rule does not, however, prohibit a court from
taking notice of any admissions by the plaintiff regarding the nature of
the claims he asserted in his complaint.
** Anderson Appeal Brief at p. 10.
* 111 S. Ct. 478 (1990).
*© McCiendon claimed that his pension benefits were due to vest
shortly. Jd. at 481.
? Id. at 481.
VV
D-26
discharge law.”** It explained that the “Texas cause of action
makes specific reference to, and indeed is premised on, the
existence of a pension plan.” “Thus, in order to prevail, a
plaintiff must plead, and the court must find, that an ERISA plan
exists and the employer had a pension-defeating motive in termi-
nating the employment.”
As Anderson has done, McClendon argued that the pension
plan was irrelevant to his cause of action; the only issue was
whether Ingersoll-Rand’s motive for terminating him was im-
proper. The Court rejected McClendon’s argument because it
missed the poiut “that under the Texas court’s analysis there
simply is no cause of action if there is no plan.””*'
3. Willy v. Coastal Corp. Dees Not Support A Contrary
Result.
Anderson cited Willy v. Coastal Corp.” in support of his
argument.” Willy, decided before the Supreme Court’s decision
in Ingersoll-Rand, is not controlling.
Willy alleged that he was wrongfully discharged because he
refused to violate certain state and federal environmental laws and
*8 Id. at 483. See McLean v. Carlson Companies, 777 F. Supp.
1480, 1483 (D. Minn. 1991) (McLean’s claim that she was terminated
because she reported ERISA violations to her employer referred to, and
depended on the existence of, an ERISA plan).
7 i
© Id. See McLean v. Carlson Companies, 777 F. Supp. at 1483 (to
prove her claim, McLean had to describe the conduct she claimed
violated ERISA and the ERISA provisions violated).
*' Jd. at 484 (emphasis in original).
*? 855 F.2d 1160 (Sth Cir. 1988).
®? See Anderson Appeal Brief at p. 9.
D-27
because he insisted that his employer comply with the laws.™ The
court found that Willy’s wrongful discharge claim did not arise
under federal law because (i) the federal environmental laws did
not provide Willy a private cause of action, (ii) Willy stated
alternative theories of recovery under both state and federal
environmental law, and (iii) the federal issues in Willy’s wrongful
discharge case — whether he had been asked to act in violation of
the environmental laws — were collateral in nature and not sub-
stantial in relation to the claim as a whole.”
None of the three grounds relied upon in Willy, let alone all
three, are present in this case. First, unlike Willy, Anderson did
have a cause of action under ERISA if he had chosen to pursue it.
Anderson alleged that Crow asked him to violate ERISA and
when he refused, Crow either committed the violation himself or
forced someone else to do it. Section 502(a) of ERISA provides
that a participant, beneficiary, or fiduciary may bring a civil action
to enjoin any act or practice that violates the administrative
provisions of ERISA or of an ERISA covered plan.®’ As defined
by ERISA, Anderson is a participant, a beneficiary, and a
fiduciary.
* Willy v. Coastal Corp., 855 F.2d at 1162-63.
6° Jd. at 1169-71.
Original Petition ] VIII (R. 97).
6” 29 U.S.C. § 1132(a) (3).
% “The term ‘participant’ means any employee or former employee
of an employer, . . . who is or may become eligible to receive a benefit of
any type from an employee benefit plan which covers employees of such
employer . . ., or whose beneficiaries may be eligible to receive any such
benefit.” 29 U.S.C. § 1002(7).
“The term ‘beneficiary’ means a person designated by a participant,
or by the terms of an employee benefit plan, who is or may become
entitled to a benefit thereunder.” 29 U.S.C. § 1002(8).
“[ A] person is a fiduciary with respect to a plan to the extent (i) he
exercises any discretionary authority or discretionary control respecting
D-28
In addition, Anderson alleged that (i) Crow threatened him
on three separate occasions after he refused to commit illegal acts
and (ii) Crow and Weynand sought to discriminate against him
and terminate him because of his refusal and because he accused
Crow of wrongdoing.” Section 510 of ERISA prohibits any
person from discharging, fining, suspending, expelling, disciplin-
ing, or discriminating against a participant or beneficiary for
exercising any right he may have under subchapter one of
ERISA.” Again, section 502 provides a cause of action for
violation of section 510.”
management of such plan or exercises any authority or control respect-
ing management or disposition of its assets,...or (iii) he has any
discretionary authority or discretionary responsibility in the administra-
tion of such plan.” 29 U.S.C. § 1002(21) (A). Anderson alleged that he
was responsible for all domestic and long term investments for all of
EDS’ investment portfolios, including EDS’ pension funds. Original
Petition J IV (R. 94-95).
® Jd. (R. 94-95) Anderson later dropped the second allegation. See
Plaintiff's Second Amended Complaint at {12-15 (R. 675-677).
” 29 U.S.C. § 1140. Subchapter one of ERISA includes provisions
on disclosure, reporting, preparation of plan descriptions, filing and
furnishing of information, participation standards, accrual and payment
of benefits, funding standards, establishment of a plan, fiduciary duties
and liability, and coercion and interference with protected rights.
29 U.S.C. §§ 1001-1145.
” 29 U.S.C. § 1132(a) (3). In addition, Anderson would have had
an action under § 1132(a)(2) to seek relief under 29 U.S.C. § 1109.
The latter section creates liability when a fiduciary breaches a duty owed
to the plan. Those duties include, inter alia, (i) administering the plan
as would a prudent man acting in the same capacity, (ii) acting solely in
the interest of the participants and beneficiaries in defraying the reason-
able expenses of administering the plan, and (iii) not knowingly allowing
another fiduciary to breach his duties. 29 U.S.C. §§ 1104 and 1105.
Anderson alleged facts making Crow a fiduciary as well. Original
Petition 4 VI, VII, and VIII (R. 95-97).
D-29
Second, Anderson’s claims concerned violations of ERISA,
not violations of the environmental laws as in Willy. The states
have been “traditional partners” with the federal government in
the field of environmental regulation.” ERISA, on the other
hand, took from the states any shared responsibility for the
regulation of employee benefit plans.” Congress preempted all
state laws that related to employee benefit plans covered by
ERISA.” Congress deliberately “establish[ed] pension plan reg-
ulation as exclusively a federal concern.””* Due to ERISA’s broad
preemption provision, Anderson, unlike Willy, could not assert
that the acts he was allegedly asked to do in violation of ERISA
also violated state law.”
” Willy v. Coastal Corp., 855 F.2d at 1167, n. 10.
” ERISA’s preemption provision “demonstrates that Congress
intended to depart from its previous legislation that ‘envisioned the
exercise of state regulation power over pension funds,’ ... and meant to
establish pension plan regulations as exclusively a federal concern.”
Alessi v. Raybestos-Manhattan, Inc., 101 S. Ct. 1895, 1906 (1981).
™ U.S.C. § 1144(a). See infra. text accompanying notes 97-101.
> Pilot Life Ins. Co. v. Dedeaux, 107 S. Ct. 1549, 1552 (1987).
Christopher v. Mobil Oil Corp., 950 F.2d 1209, 1217 (Sth Cir. 1992)
(“The Supreme Court has consistently emphasized the expansiveness of
[ERISA’s preemption provision] and its purpose of establishing the
regulation of pension plans as an exclusively federal concern.”), cert.
denied, 113 S. Ct. 68 (1992).
© The court in Willy recognized this distinction. It noted that
“Congress had expressed an explicit intent for actions preempted by
section 502(a) [of ERISA] to arise under federal law,” but that the
legislative history of the environmental statutes underlying Willy’s claim
did not evidence the same Congressional intent, Willy v. Coastal Corp.,
855 F.2d at 1166.
Also, unlike Willy, Anderson did not specifically allege in his
Original Petition that he was asked to violate any state laws. Original
Petition at VII (R. 96-97).
D-30
Third, as discussed above, the Court in Ingersoll-
Rand rejected Willy's third ground for ruling: that the federal
issues in a wrongful discharge case are collateral and not substan-
tial.”’ Due to the differences between the environmental laws in
Willy and ERISA, differences which the court in Willy noted,
and the Supreme Court’s rejection of Willy's view of the collat-
eral nature of the federal issues, the decision in Willy is not
controlling.”
” Ingersoll-Rand Co. v. McClendon, 111 S. Ct. at 483. See supra.
text accompanying notes 58-61.
8 Anderson also cited Sperling v. Texas Health Enterprises, Inc.,
791 F. Supp. 662 (S.D. Tex. 1992); and Nowoc v. Rheem Mfg. Co., 772
F. Supp. 977 (S.D. Tex. 1991). Again, neither decision is controlling.
As the district court recognized in Sperling, that case is distinguish-
able from /ngersoll-Rand. It is also distinguishable from the facts of this
case. Sperling sued for wrongful discharge alleging that he was termi-
nated because he refused to participate in his employer’s accident plan.
Sperling v. Texas Health Enterprises, Inc., 791 F. Supp. at 663. The
court found that such an action was not preempted by ERISA and
distinguished the case on three grounds. One, unlike McClendon (and
Anderson), Sperling was not a plan participant or beneficiary. Two,
Sperling did not allege a violation of ERISA or an employee benefit plan
as McClendon (and Anderson) alleged. Three, Sperling would have had
a cause of action even if there was no ERISA covered plan. The court
found that the same could not be said for McClendon. Similarly, based
on Ingersoll-Rand, the same can not be said for Anderson either. Jd. at
664-65.
The court in Nowoc also distinguished its case from Ingersoll-Rand.
It, too, is distinguishable from the facts in this case. Nowoc alleged that
he was fired in violation of an alleged duty of good faith and fair dealing.
Among the damages he sought were “fringe benefits.” The court
distinguished the case from Ingersoll-Rand because (i) Nowoc had not
alleged a violation of ERISA in his pleadings and (ii) the loss of
Nowoc’s pension benefits was a mere consequence of his termination.
Unlike in Ingersoll-Rand and this case, no ERISA violations were
alleged to have been involved in the decision to terminate Nowoc.
Nowoc v. Rheem Mfr. Co., 772 F. Supp. at 979.
: ‘
D-31
Under the well-pleaded complaint rule, Anderson’s Original
Petition stated claims arising under federal law. As Ingersoll- ;
Rand instructs, the federal issues went to the heart of Anderson’s |
claim. The district court had federal question subject matter
jurisdiction.
B. The District Court Had Removal Jurisdiction Based On The
Complete Preemption Doctrine.
1. The Complete Preemption Doctrine Applied to Ander-
son’s Suit.
Even if Anderson’s Original Petition did not state a claim
arising under federal law, removal was still proper under the
“complete preemption” doctrine. Federal preemption is ordinarily
a defense and does not support removal under the “well-pleaded
complaint” rule.” The Supreme Court, however, has recognized
that Congress can so completely preempt an area of law that any
state law cause of action within that area is treated as federal in
character and is removable without regard to the well-pleaded
complaint rule.”
The Supreme Court first applied the complete preemption
doctrine to section 301 of the Labor Management Relations Act
(“LMRA”) in Avco Corp. v. Machinists.*' The Court later
explained that:
the preemptive force of § 301 is so powerful as to displace
entirely any state cause of action ‘for violation of contracts
between an employer and a labor organization.’ Any such
suit is purely a creature of federal law, notwithstanding the
” Metropolitan Life Ins. Co. v. Taylor, 107 S. Ct. 1542, 1546
(1987).
© Id.
*' 88 S. Ct. 1235 (1968). See, e.g., Richardson v. United Steel-
workers of America, 864 F.2d 1162, 1167 (Sth Cir. 1989), cert. denied,
110 S. Ct. 2204 (1990).
D-32
fact that state law would provide a cause of action in the
absence of § 301.”
The Supreme Court extended the complete preemption doctrine
to ERISA in Metropolitan Life Ins. Co. v. Taylor.®
Taylor, a participant in a health insurance plan offered by his
employer and insured by Metropolitan Life, sued both when the
latter denied him benefits under the plan. He asserted state law
claims for breach of contract, reimplementation of all benefits and
insurance coverage, wrongful termination, and wrongful failure to
promote. The defendants removed. The district court upheld the
removal, but the court of appeals reversed. It found that Taylor’s
complaint stated only state law causes of action subject to the
federal defense of ERISA preemption which did not support
removal.** The Supreme Court reversed the court of appeals.
The Court framed the issue before it as whether the
Avco principle could be extended to recharacterize a state law
complaint displaced by section 502(a) of ERISA as an action
arising under federal law.® It began its analysis of the issue by
finding that the policy choices underlying ERISA’s enforcement
®? Metropolitan Life Ins. Co. v. Taylor, 107 S. Ct. at 1546, quoting,
Franchise Tax Board of Cal. v. Construction Laborers Vacation Trust
for Southern Cal., 103 S. Ct. 2841, 2853 (1983). See also Arron v.
National Union Fire Ins. Co. of Pittsburg, 876 F.2d 1157, 1161 (Sth Cir.
1989) (Avco Corp. “holds that federal law can so completely preempt a
field of state law that the plaintiff's complaint must be recharacterized as
stating a federal cause of action.”), cert. denied, 110 S. Ct. 1121 (1990).
® 107 S. Ct. 1542, 1547-48 (1987).
* Id. at 1545.
2
* Id. at 1547. Before reaching the ultimate issue the Court
recognized that under its decision in Pilot Life Ins. Co. v. Dedeaux, 107
S. Ct. 1549 (1987), announced the same day, Taylor’s state common
law tort and contract claims were preempted by ERISA. Id. at 1546.
D-33
scheme would be undermined if plaintiffs were allowed to pursue
state law remedies.
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 ERISA.®’
The Court next found that the language of ERISA’s jurisdictional
provision closely paralleled that of section 301 of the LMRA and
noted that similar language in two labor laws should have a
similar meaning.™ The Court further found that this presumption
of similarity was “fully confirmed by the legislative history of
ERISA’s civil enforcement provisions.”®
Based on the policies underlying ERISA and its enforcement
scheme, the similarities between the language of ERISA’s juris-
dictional provision and section 301 of the LMRA, and the
legislative history of ERISA, the Court held that Congress
“clearly manifested an intent to make causes of action within the
scope of the civil enforcement provisions of § 502(a) removable
to federal court.”” The Court found Taylor’s claims within the
scope of section 502(a), and properly removable.”!
*” Metropolitan Life Ins. Co. v. Taylor, 107 S. Ct. at 1547.
88
Id.
* Jd. For example, the Conference Report on ERISA stated that
“{AJll such actions in Federal or State courts are to be regarded as
arising under the laws of the United States in similar fashion to those
brought under section 301 of the Labor-Management Relations Act of
1947. Id. at 1547, quoting, H.R.Conf.Rep.No. 93-1280, p. 327.
* Metropolitan Life Ins. Co. v. Taylor, 107 S. Ct. at 1546-48.
*' Id. The Court concluded that “this suit, though it purports to
raise only state law claims, is necessarily federal in character by virtue of
the clearly manifested intent of Congress. It, therefore, ‘arise[s] under
the ... laws . . . of the United States,’ 28 U.S.C. § 1331, and is
D-34
Under the teaching of Taylor, Anderson’s suit was properly
removed to federal court. Anderson’s claim of wrongful discharge
based on his refusal to do certain administrative acts in violation
of ERISA is within the scope of section 502(a) of ERISA.
Section 502(a) provides in part that any participant, benefi-
ciary, or fiduciary may bring a civil action:
“(A) to enjoin any act or practice which violates any provi-
sion of this subchapter or the terms of the plan, or (B) to
obtain other appropriate equitable relief (i) to redress such
violations or (ii) to enforce any provisions of this subchapter
or the terms of the plan.””
Subchapter one, in which section 502(a) is located, includes all of
the administrative and enforcement provisions regarding ERISA
employee benefit plans: provisions regarding disclosure, reporting,
preparation of plan descriptions, filing and furnishing of informa-
tion, participation standards, accrual and payment of benefits,
funding standards, establishment of a plan, fiduciary duties and
liability, and coercion and interference with protected rights.”
Anderson’s allegations that he was requested to take certain
administrative actions in violation of ERISA, and in violation of
his fiduciary duties under ERISA, fall within the scope of
subchapter one and section 502(a).™ As a result, under Taylor,
removable to federal court by the defendants, 28 U.S.C. § 1441(b).” Jd.
at 1548.
% §02(a) (3); 29 U.S.C. 1132(a) (3).
% 29 U.S.C. §§ 1001-1145.
See supra. text accompanying notes 66-71. Anderson’s allega-
tions that he was terminated for reporting Crow’s wrongful conduct,
including ERISA violations, also falls within section 502(a). Sec-
tion 510 makes it unlawful to discharge or discriminate against any
person because he has given information regarding an ERISA violation
or as part of an ERISA investigation. 29 U.S.C. § 1140. See McLean v.
Carlson Companies, 777 F. Supp. at 1484 (“Plaintiff clearly would have
D-35
Anderson’s claim was properly characterized as federal in nature
and removable to federal court.”
recourse under § 510 had she been discharged in retaliation for com-
mencing legal action against defendant to correct what she perceived to
be violations of ERISA. In view of the express authorization to sue to
remedy violations of ERISA, the court finds it logical to infer the
plaintiff also possesses the right to inform plan administrators of sus-
pected violations of ERISA”). Cf Rayner v. Smirl, 873 F.2d 60, 63-64
(4th Cir. 1989) (held that whistleblower provision in Federal Railroad
Safety Authorization Act, which provided an exclusive remedy preempt-
ing state claims for wrongful discharge and making removal appropriate,
extended to intra-corporate complaints finding that the distinction be-
tween intra-corporate complaints and complaints to outside agencies to
be artificial in light of the comprehensive nature of the Act).
In addition, as a fiduciary, Anderson owed certain duties and
obligations to the plan. 29 U.S.C. §§ 1104, 1105. One of those duties
involved not allowing a lary to violate ERISA, the plan, or his
duties. Jd. at § 1105. Asa tary, Anderson had the right to enjoin
others from violating ERISA, including other fiduciaries. Jd at
§ 1132(a)(2) and (3). It would be consistent with the purposes of
ERISA and the enforcement scheme for Anderson also to have the night
to enjoin Crow, another fiduciary, from forcing him to violate ERISA
and his duties.
** Broad removal is consistent with Congress’ desire (i) for uni-
formity of regulation, (ii) for exclusivity of federal regulation, and
(iii) to have ERISA’s preemption provision broadly construed. Allowing
Anderson to proceed in state court with his claim, requiring a determi-
nation whether certain conduct would violate ERISA or an ERISA
plan, is inconsistent with Congress’ desires and the structure and
purpose of ERISA. See supra. notes 96-100, 104-105, 107. See also Pilot
Life Ins. Co. v. Dedeaux, 107 S. Ct. at 1555 (in expounding on a statute,
a court should be guided by the provisions of the entire statute and by its
object and policy). NLRB v. Scrivener, 92 S. Ct. 798, 802 (1972)
(whether other provisions of a statute have been interpreted broadly or
narrowly is pertinent precedent when construing another provision of the
statute).
D-36
2. Anderson’s Claim Was Preempted by ERISA.
Although Anderson did not discuss the “complete preemp-
tion’’ doctrine in his brief, he did assert that his claim is neither
preempted by ERISA nor removable because ERISA does not
provide a specific remedy for wrongful termination based on a
refusal to violate ERISA.” Anderson is incorrect. His claim is
preempted by ERISA and removable under ERISA regardless of
whether ERISA provides him with an identical cause of action.
The Ingersoll-Rand decision teaches that Anderson’s wrong-
ful discharge claim is preempted by ERISA regardless of whether
ERISA contains a cause of action identical to Anderson’s state
law claim. The Court noted that ERISA’s preemption clause is
“conspicuous for its breadth” and that its “deliberately expansive
language was designed to establish pension plan regulation as
exclusively a federal concern.”
ERISA’s preemption provision is embodied in section
514(a) which provides that ERISA displaces any and all laws
that relate to an employee benefit plan covered by ERISA.” The
%° Anderson Appeal Brief at pp. 13-14.
*” Ingersoll-Rand Co. v. McClendon, 111 S. Ct. at 482, quoting,
FMC Corp. v. Holliday, 111 S. Ct. 403, 407 (1990) and Pilot Life Ins.
Co. v. Dedeaux, 107 S. Ct. 1549, 1552 (1987). See, e.g., Christopher v.
Mobil Oil Corp., 950 F.2d 1209, 1217 (Sth Cir. 1992).
% 29 U.S.C. § 1144(a). See, e.g, Mackey v. Lanier Collection
Agency & Service, 108 S. Ct. 2182, 2185 (1988) (ERISA’s preemption
provision displaces all state laws that fall within its sphere); Jron
Workers Mid-South Pension Fund v. Terotechnology Corp., 891 F.2d
548, 553 (Sth Cir.) (“Because of the breadth of the preemption clause
and the broad remedial purpose of ERISA, ‘state laws found to be
beyond the scope of [the preemption clause] are few.’”), cert. denied,
110 S. Ct. 3272 (1990).
ERISA lists the general areas of state concern exempt from the
reach of its preemption provision — insurance, banking, securities, and
general criminal laws. See, e.g., Pilot Life Ins. Co. v. Dedeaux, 107 S.
D-37
Court noted that Congress rejected more limited preemptive
language which would have limited the provision’s application to
state laws relating to the specific subjects covered by ERISA.
“{T ]o underscore its intent that § 514(a) be expansively applied,
Congress used equally broad language in defining the ‘State law’
that would be preempted. Such laws include ‘all laws, decisions,
rules, regulations, or other State action having the effect of
law.’ ””
The Court further noted that a “law ‘relates to’ an employee
benefit plan, in the normal sense of the phrase, if it has a
connection with or reference to such a plan.”'™ This holds true,
even if the law is not “specifically designed to affect” employee
benefit plans, or “the effect is only indirect.”'”'
Ct. at 1552; Shaw v. Delta Air Lines, 103 S. Ct. 2890, 2903 (1983).
“There is no reason to believe that Congress intended implicitly to
exempt a whole range of state laws when it showed itself perfectly
capable of carving out specific exemptions.” Corcoran v. United Health-
care, Inc., 965 F.2d 1321, 1334 (Sth Cir.), cert. denied, 113 S.Ct. 812
(1992).
* Ingersoll-Rand Co. v. McClendon, 111 S.Ct. at 482-83, quoting,
29 U.S.C. § 1144(c) (1). See, e.g., Pilot Life Ins. Co. v. Dedeaux, 107
S.Ct. 1549, 1552 (1987), quoting, Sen. Williams, one of the sponsors of
ERISA, 120 Cong.Rec. 29933 (1974) (preemption “is intended to
apply in its broadest sense to all actions of State or local governments, or
any instrvmentality thereof, which have the force or effect of law.”’);
Corcoran v. United Healthcare, Inc., 965 F.2d at 1328 n.10 (“Statutory,
decisional, and all other forms of state law are included within the scope
of the preemption clause.”).
'© Ingersoll-Rand Co. v. McClendon, 111 S.Ct. at 483, quoting,
Shaw v. Delta Air Lines, 103 S.Ct. 2890, 2900 1983). See, e.g., Corcoran
v. United Healthcare, Inc., 965 F.2d 1321, 1328-29 (Sth Cir.), cert
denied, 113 S.Ct. 812 (1992).
‘©! Ingersol. Rand Co. v. McClendon, 111 S.Ct. at 483. See, eg.
District of Columbia v. Greater Washington Board of Trade, 113 S.Ct.
580, 583 (1992); Pilot Life Ins. Co. v. Dedeaux, 107°S.Ct. at 1553;
Corcoran v. United Healthcare, Inc., 965 F.2d at 1329 (“a law is not
D-38
Based on the foregoing principles, the Court found that
McClendon’s wrongful termination cause of action was a state
law related to ERISA and therefore preempted by section
514(a).'" The Court noted that it was not dealing with “a
generally applicable statute that makes no reference to, or indeed
functions irrespective of, the existence of an ERISA plan.”'”
Instead, the existence of a pension plan was a “critical factor in
establishing liability under the State’s wrongful discharge law.”'™
The Court believed that Congress’ purposes for having a
broad preemption provision supported its finding of preemption.
By providing for broad preemption, the Court noted that Congress
sought to ensure the creation of uniform standards thereby
avoiding the administrative and financial cost of complying with
varying state standards.
Section 514(a) was intended to ensure that plans and plan
sponsors would be subject to a uniform body of benefit law;
the goal was to minimize the administrative and financial
burden of complying with conflicting directives among States
or between States and the Federal Government. Otherwise,
saved from preemption merely because it does not target employee
benefit plans. Indeed, much preemption litigation involves laws of
general application which, when applied in particular settings, can be
said to have a connection with or a reference to an ERISA plan.”);
Christopher v. Mobil Oil Corp., 950 F.2d at 1218-19 (“preempted state
law includes any state law cause of action as it relates to an employee
benefit plan, even if it arises under a general laws which in and of itself
has no connection to employee benefit plans.”’).
'©2 Ingersoll-Rand Co. v. McClendon, 111 S.Ct. at 483.
103 Id.
'* Jd. “Because the court’s inquiry must be directed to the plan,”
the Court concluded that McClendon’s “judicially created cause of
action ‘relates[s] to’ an ERISA plan.” Jd.
D-39
the inefficiencies created could work to the detriment of plan
beneficiaries.'”°
The Court voiced concern that allowing state common law claims
like McClendon’s to proceed would subject plans and plan spon-
sors to differing state substantive laws an outcome that “‘is
fundamentally at odds with the goal of uniformity that Congress
sought to implement.”'™
'5 Id. at 484. Reviewing the legislative history and the Court's
prior decisions, the Supreme Court in Fort Halifax concluded that
“Congress intended preemption to afford employers the advantages of a
uniform set of administrative procedures governed by a single set of
regulations.” Fort Halifax Packing Co. v. Coyne, 107 S. Ct. at 2217.
Congress wanted to “ensur[e] that employers would not face ‘conflict-
ing or inconsistent State and local regulation of employee benefit
plans’”’. Shaw v. Delta Air Lines, 103 S. Ct. at 2904. See, e.g., Pilot Life
Ins. Co. v. Dedeaux, 107 S. Ct. 1549, 1552 (1987), quoting, Sen.
Williams, 120 Cong. Rec. 29933 (1974) (preemption designed to
eliminate “the threat of conflicting or inconsistent State and local
regulation of employee benefit plans.”’); Shaw v. Delta Air Lines, 103 S.
Ct. 2890, 2901 (1983), quoting, Rep. Dent, House sponsor of ERISA,
120 Cong. Rec. 29197 (1974) (the “crowning achievement” of ERISA
was “the reservation to Federal authority the sole power to regulate the
field of employee benefit plans.”).
‘© Ingersoll-Rand Co. v. McClendon, 111 S. Ct. at 484 (“Particu-
larly disruptive is the potential for conflict in substantive law. It is
forseeable that state courts, exercising their common law powers, might
develop different substantive standards applicable to the same employer
conduct, requiring the tailoring of plans and employer conduct to the
peculiarities of the law of each jurisdiction.”). See, e.g, Corcoran v.
United Healthcare, Inc., 965 F.2d at 1332 (“allowing the Corcorans’ suit
to go forward would contravene Congress’ goals of ’ensur[ ing] that plans
and plan sponsors would be subject to a uniform body of benefit law’ and
‘minimiz[ing] the administrative and financial burdens of complying
with conflicting directives among States or between States and the
Federal Government.”); Christopher v. Mobil Oil Corp., 950 F.2d 1209,
1219 (Sth Cir. 1992) (“Superimposing state law fraud standards on the
elaborate ERISA provisions governing the content and timing of notice
of plan provisions and amendments . . . would undercut the goal of
D-40
The Court’s preemption analysis was not dependent on
whether McClendon had an identical or any cause of action
awaiting him under ERISA.'” The Court noted that when
Congress chose to base section 502(a) on the exclusive remedy
found at section 301 of the LMRA, it knew that section 301
displaced all state law claims “even when the state action pur-
ported to authorize a remedy unavailable under the federal
provision.”
uniform national regulations in the manner that section 514(a) seeks to
prevent.”).
‘©’ Only as an alternative ground for finding McClendon’s claim
preempted did the Court analyze whether ERISA provided a remedy.
The Court found that “[e]ven if there were no express preemption in
this case, the Texas cause of action would be preempted because it
conflicts directly with an ERISA cause of action.” /ngersoll-Rand Co. v.
McClendon, 111 S. Ct. at 484-85. Obviously, whether McClendon had a
cause of action under ERISA played no role in the Court’s primary
preemption analysis.
‘8 Ingersoll-Rand Co. v. McClendon, 111 S. Ct. at 486.
The Supreme Court in Pilot Life summed up the balance sought in
ERISA’s civil enforcement scheme and its exclusive nature;
[T]he detailed provisions of § 502(a) set forth a comprehen-
sive civil enforcement scheme that represents a careful balanc-
ing 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 re-
flected in the inclusion of certain remedies and the exclusion of
others under the federal scheme would be completely under-
mined if ERISA-plan participants and beneficiaries were free
to obiain remedies under state law that Congress rejected in
ERISA. ‘The six carefully integrated civil enforcement provi-
sions found in § 502(a) of the statute as finally en-
acted . . . provide strong evidence that Congress did not
intend to authorize other remedies that it simply forgot to
incorporate expressly.’
The court in Pilot Life found the plaintiff's state law claims
were preempted even though all of the remedies available
D-41
Like McClendon, Anderson’s wrongful discharge claim ref-
erenced ERISA and was premised on the existence of an ERISA
plan. Anderson’s allegations required the court to determine
whether an ERISA plan existed and whether Anderson was asked
to do certain acts in violation of ERISA. If there was no ERISA
plan, then there could have been no violation of ERISA. In
addition, like McClendon, to allow Anderson to go forward on his
claim would have the effect of subjecting an ERISA plan and
plan sponsor to differing standards and rules for administering its
ERISA plans.'”
The only difference between McClendon’s claim and Ander-
son’s claim is the alleged motivation of their respective employers.
McClendon alleged that his employer terminated him to keep his
pension benefits from vesting. Anderson claims EDS terminated
him because he refused to violate ERISA. The Court in Ingersoll-
Rand, however, recognized this to be a distinction without a
difference when determining preemption. The Court found that
“there is no basis in § 502(a)’s language for limiting ERISA
actions to only those which seek ‘pension benefits’. . . . Conse-
quently, it is no answer to a preemption argument that a particular
plaintiff is not seeking recovery of pension benefits.””''°
under the state law were not available under ERISA Pilot Life
Ins. Co. v. Dedeaux, 107 S. Ct. at 1556.
'° See McLean v. Carlson Companies, 777 F. Supp. at 1483
(ERISA preempts “laws that provide remedies for misconduct growing
out of the administration of ERISA plans.”).
‘1° Ingersoll-Rand Co. v. McClendon, 111 S. Ct. at 486.
D-42
3. Anderson’s Claim Was Removable Under ERISA.
The decision in Taylor defeats Anderson’s contention that
removal is inappropriate unless ERISA provides a private cause
of action identical to his claim for wrongful termination. Ander-
son’s argument misinterprets the test announced in Taylor.
Taylor does not provide that a state action can not be
removed unless ERISA also provides the exact same federal
cause of action. To the contrary, the test for removal announced
in Taylor is whether the cause of action is “within the scope of
the civil enforcement provisions of § 502(a) ....”''' The Court in
Taylor found that Taylor’s claims for breach of contract, wrongful
termination of disability benefits, wrongful termination, and re-
fusal to promote were all properly removed to federal court,''”
even though ERISA does not provide identical causes of action.
This Circuit, too, has recognized that the existence of an
identical remedy, or any remedy, under ERISA is not a prerequi-
site for either preemption or removal. For example, in Corcoran v.
United Healthcare, Inc.,''? the Corcorans sought authorization
from United Healthcare, the utilization manager of the employee
benefit plan that covered the Corcorans, for certain treatment for
Mrs. Corcoran during her pregnancy. United Healthcare denied
authorization. When their unborn child died, the Corcorans sued
United Healthcare in state court claiming that United Healthcare
negligently refused to authorize the necessary treatment. United
''! Metropolitan Life Ins. Co. v. Taylor, 107 S. Ct. at 1548. See,
e.g., Iron Workers Mid-South Pension Fund v. Terotechnology Corp.,
891 F.2d 548, 551 (Sth Cir. 1990) (“a state law cause of action that is
within the scope of the civil enforcement provisions of ERISA § 502(a)
was a well-pleaded federal claim.”’).
"2 Id at 1545-46.
'' 965 F.2d 1321 (Sth Cir. 1992).
™ aa
D-43
Healthcare removed and alleged that the Corcoran’s claims were
preempted by ERISA.''*
Acknowledging that ERISA’s civil enforcement scheme did
not provide a private cause of action for medical malpr
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