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Goldman v. Hartford Life and Accident Insurance Co.

United States District Court, E.D. Louisiana
Aug 30, 2004
Civil Action No. 03-759, Section: "R" (5) (E.D. La. Aug. 30, 2004)

Summary

dismissing plaintiff's demand for penalties because civil enforcement provisions of ERISA are exclusive and "ERISA does not provide a remedy of penalties to a party seeking to recover benefits due to him under the terms of his insurance plan."

Summary of this case from Hartford Life & Accident Ins. Co. v. Varnado

Opinion

Civil Action No. 03-759, Section: "R" (5).

August 30, 2004


ORDER AND REASONS


Defendant Hartford Life and Accident Insurance Company moves the Court to strike certain claims and allegations from plaintiff's amended complaint. For the following reasons, the Court GRANTS Hartford's motion to the extent that it is not moot.

I. BACKGROUND

In March 2001, plaintiff Gilbert Goldman injured himself at work in an offshore accident. Specifically, Goldman fell and injured his head, arm, and neck when his rig began to flip. At the time of the accident, Goldman was employed by Baroid Drilling Fluids, Inc., a division of the Halliburton Company.

On February 3, 2003, Goldman sued Hartford for long-term disability ("LTD") benefits in state court in Terrebonne Parish. Hartford removed the state court proceedings to this Court in March 2003. Hartford grounded jurisdiction under 28 U.S.C. § 1331 because the Employee Retirement Income Security Act of 1974 governs Hartford's disability plan. The parties agree that ERISA governs the action. Because Goldman had not filed a claim for benefits from Hartford before he filed suit, the Court stayed the proceedings in order to allow Goldman to submit a claim to Hartford for review. Goldman then applied for LTD benefits under an insurance policy issued to Halliburton by Hartford. In April 2003, Hartford denied Goldman's application for LTD benefits.

Hartford moves to strike Goldman's allegations that are based on theories of negligence and breach of contract. Hartford also moves to strike Goldman's demand for penalties. A motion to strike is not the appropriate vehicle for resolving whether a plaintiff's complaint states a right to relief. Instead, a motion to dismiss is the appropriate motion. Accordingly, the Court will construe the motion to strike these portions of Goldman's complaint as a motion to dismiss under Rule 12(b) (6). See Westside-Marrero Jeep Eagle, Inc. v. Chrysler Corp., 1999 WL 816503, at *1 (E.D. La. Oct. 12, 1999) (construing motion to strike as motion to dismiss under Rule 12(b) (6)). For the reasons stated below, the Court finds that Goldman fails to state a claim for which relief can be granted in contract, tort, or for penalties.

Hartford also moves to strike Goldman's demand for a jury trial. The Court grants this motion for the reasons stated below. Finally, Hartford moves to strike allegations that the plaintiff has since amended out of his complaint. As to those allegations, Hartford's motion to strike is denied as moot.

II. MOTION TO DISMISS

A. Legal Standard

Dismissal under Rule 12(b) (6) is warranted if it appears certain that the plaintiff cannot prove any set of facts in support of his claim that would entitle him to relief. Vulcan Materials Company v. City of Tehuacana, 238 F.3d 382, 387 (5th Cir. 2001); Piotrowski v. City of Houston, 51 F.3d 512, 514 (5th Cir. 1995) (quoting Leffall v. Dallas Indep. Sch. Dist., 28 F.3d 521, 524 (5th Cir. 1994)). In deciding the motion, the Court must accept all well-pleaded facts as true and view the facts in the light most favorable to the plaintiff. See Baker v. Putnal, 75 F.3d 190, 196 (5th Cir. 1996); American Waste Pollution Control Co. v. Browning-Ferris, Inc., 949 F.2d 1384, 1386 (5th Cir. 1991). The Court must resolve doubts as to the sufficiency of the claim in plaintiff's favor. Vulcan Materials, 238 F.3d at 387.

B. Analysis

(1) Claims for Breach of Contract and Negligence

Hartford argues that Goldman's state-law claims for breach of contract and negligence are pre-empted by ERISA. ERISA "supercede[s] any and all State laws insofar as they may now or hereafter relate to an employee benefit plan." 29 U.S.C. § 1144(a). The Supreme Court interprets the federal preemption provision of ERISA broadly. See Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 739 (1985). "[P]reempted state law includes any state law cause of action as it relates to an employee benefit plan, even if it arises under a general law which in and of itself has no connection to employee benefit plans." Christopher v. Mobil Oil Corp., 950 F.2d 1209, 1218-19 (5th Cir. 1992). When the underlying conduct at issue is connected to an employee benefit plan, "state law claims are preempted in their entirety." Id. at 1220. See also Shaw v. Delta Airlines, 463 U.S. 85, 96-7 (1983). ERISA has a narrow savings clause under which ERISA does not preempt a state law that "regulates insurance." 29 U.S.C. § 1144(b) (2) (A). A state law is 'saved' from ERISA preemption if the law is "'specifically directed toward' the entities engaged in insurance." Kentucky Ass'n of Health Plans, Inc. v. Miller, 538 U.S. 329, 334 (quoting Pilot Life Ins. v. Dedeaux, 481 U.S. 41, 50 (1987)).

Goldman's breach of contract claims and his negligence claim arise out of his claim for LTD benefits. Specifically, he asserts that Hartford breached a contract with him by cancelling his benefits without informing him of the cancellation, and he asserts that Hartford breached a contract with him or acted negligently when it accepted his paycheck deductions for coverage during the time that Hartford asserts that he was no longer covered. ( See Pl.'s Compl. at ¶¶ 9-10.) Thus, all of Goldman's state law claims are connected to his employee benefit plan.

The insurance exception in section 1144(b) (2) (A) does not save Goldman's claims from preemption. "[L]aws of general application that have some bearing on insurers do not qualify" under the savings clause in section 1144(b) (2) (A). Miller, 538 U.S. at 334. Goldman's claims for breach of contract and tort implicate such laws of general application, and these claims are not exempt from preemption under section 1144(b) (2) (A). See Chapman v. Prudential Life Ins. Co. of Am., 267 F. Supp.2d 569, 581 (E.D. La. 2003) (finding that state law tort claims were laws of general application and not saved by section 1144(b) (2) (A)). Therefore, ERISA preempts Goldman's claims for breach or contract and negligence. See Pilot Life, 481 U.S. 41, 57 (1987) (finding ERISA preempted plan participant's state law claims for breach of contract and tort for failure to pay benefits); Hogan v. Kraft Foods, 969 F.2d 142, 144-45 (5th Cir. 1992) (same); Hermann Hosp. v. MEBA Med. Benefits Plan, 845 F.2d 1286, 1290 (5th Cir. 1988) (same).

Accordingly, because Goldman can prove no set of facts under which he can recover for breach of contract and negligence, the Court grants Hartford's motion to dismiss these claims.

(2) Demand for Penalties

Hartford moves the Court to dismiss Goldman's demand for penalties because a party cannot recover penalties under ERISA. The Supreme Court has indicated that the civil enforcement provisions of section 1132(a) are the exclusive remedies available under ERISA. Massachusetts Mut. Life Ins. Co. v. Russell, 473 U.S. 134, 146-47 (1985). ERISA does not provide a remedy of penalties to a party seeking to recover benefits due to him under the terms of his insurance plan. See 29 U.S.C. 1132(a) (1)(B). Cf. also Hicks v. CNA Ins. Co., 4 F. Supp.2d 576, 579-80 (E.D. La. 1998) (finding that ERISA preempts state law remedy of penalties and granting defendant's motion to strike plaintiff's demand for penalties); Rasmussen v. Metropolitan Life Ins. Co., 675 F. Supp. 1497, 1504 (W.D. La. 1987) (finding that ERISA preempts state law claims for penalties). Thus, Goldman cannot recover on a claim for penalties. Accordingly, the Court dismisses his demand for penalties.

III. MOTION TO STRIKE

A. Legal Standard

Rule 12(f) provides that "the court may order stricken from any pleading . . . any redundant, immaterial, impertinent, or scandalous matter." FED.R.CIV.P. 12(f). A motion to strike under Rule 12(f) "is a drastic remedy to be resorted to only when required for the purposes of justice. . . ." Augustus v. Board of Pub. Instruction of Escambia County, 306 F.2d 862, 868 (5th Cir. 1962) ( quoting Brown Williamson Tobacco Corp. v. United States, 201 F.2d 819, 822 (6th Cir. 1953). See also Turner v. Ethicon Endo-Surgery, Inc., 2003 WL 22872103 (E.D. La. Dec. 2, 2003) (noting that motions to strike are disfavored and courts grant them infrequently). Accordingly, such a motion should be granted only when "the allegations are prejudicial to the defendant or immaterial to the lawsuit." Johnson v. Harvey, 1998 WL 596745, at *7 (E.D. La. 1998) (quoting Veazie v. Southern Greyhound Lines, 374 F. Supp. 811, 815 (E.D. La. 1994)). To establish immateriality under Rule 12(f), the movant must show that the challenged allegations can "have no possible bearing upon the subject matter of the litigation." Alton Ochsner Med. Found. v. Servicemaster Home Health Care Serv., 2002 WL 553499 at *1 (E.D. La. April 12, 2002). See also Sadler v. Benson Motors Corp., 1997 WL 266735, at *1 (E.D. La. May 15, 1997). The Court will not decide a disputed question of fact on a motion to strike. Succession of Wardlaw v. Whitney Nat'l Bank, 1994 WL 479183, at *1 (citing Augustus, 306 F.2d at 868).

B. Analysis

The Court notes at the outset that Hartford does not allege that it has been prejudiced by any of the allegations in Goldman's complaint. Additionally, Hartford does not argue that justice requires the Court to strike the allegations. Thus, Hartford must establish that the challenged allegations are immaterial and have no possible bearing on the action.

Hartford moves the Court to strike Goldman's demand for a jury trial. The Fifth Circuit has held that "ERISA does not entitle [a plaintiff] to a trial by jury." Calamia v. Spivey, 632 F.2d 1235, 1237 (5th Cir. 1980) (reasoning that actions for denial of benefits are more equitable than legal in nature). See also Borst v. Chevron Corp., 36 F.3d 1308, 1323-24 (5th Cir. 1994) (holding that the district court did not err in striking plaintiffs' jury demand in an ERISA action). Goldman argues that he is entitled to a trial by jury. The substance of Goldman's memorandum in support of his demand for a jury trial consists of one sentence and a citation to a federal district court case: "The basis for a jury trial is that the parties are residents of different states, the monetary claim is in excess of $75,000 and the legal authority is Hulcher v. United Behavioral Systems, 919 F. Supp. 879." Goldman has not favored the Court with an analysis of Hulcher and how it can be squared with the law in the Fifth Circuit.

Incidentally, diversity is irrelevant in ERISA actions. See 29 U.S.C. § 1132(f).

See Hulcher v. United Behavioral Sys., Inc., 919 F. Supp. 879 (E.D. Va. 1995) (declining to strike a plaintiff's demand for trial by jury, reasoning that actions for denial of benefits under ERISA are legal, not equitable, in nature). Hulcher is contrary to Calamia.

As this Court is bound by the Fifth Circuit's decision in Calamia, plaintiff is not entitled to a trial by jury in this ERISA action. Accordingly, the Court strikes Goldman's demand for trial by jury. See Mello v. Sara Lee, 292 F. Supp.2d 902, 907 (N.D. Miss. 2003) (striking plaintiffs' demand for a jury trial in an ERISA action); Ross v. Chevron Texaco, Inc., 2003 WL 22071284, at *2 (E.D. La. Sept. 3, 2003) (noting that ERISA does not provide plaintiffs a right to a jury trial and declining to grant the plaintiff a jury trial); Edwards v. Texas-New Mexico Power Co., 2003 WL 22070903, at *1 (N.D. Tx. Jan. 7, 2003) (striking plaintiff's demand for jury trial because there is no right to jury trial under ERISA); Damron v. Worldcom, Inc., 2001 WL 1561998, at *2 (N.D. Tx. Dec. 5, 2001) (striking plaintiff's demand for jury trial because there is no right to a jury trial under ERISA); MB Valuation Svs., Inc. v. Ins. Co. of N. Am., 1997 WL 642987 at *4-6 (N.D. Tx. Oct. 6, 1997) (striking plaintiffs' demand for a jury trial in an ERISA action).

IV. CONCLUSION

The Court GRANTS Hartford's motion to dismiss Goldman's state law claims for breach of contract and negligence and his demand for penalties. The Court also GRANTS Hartford's motion to strike Goldman's demand for a jury trial. As to Hartford's motion to strike other allegations that Goldman has since amended out of his complaint, Hartford's motion to strike is denied as moot.


Summaries of

Goldman v. Hartford Life and Accident Insurance Co.

United States District Court, E.D. Louisiana
Aug 30, 2004
Civil Action No. 03-759, Section: "R" (5) (E.D. La. Aug. 30, 2004)

dismissing plaintiff's demand for penalties because civil enforcement provisions of ERISA are exclusive and "ERISA does not provide a remedy of penalties to a party seeking to recover benefits due to him under the terms of his insurance plan."

Summary of this case from Hartford Life & Accident Ins. Co. v. Varnado
Case details for

Goldman v. Hartford Life and Accident Insurance Co.

Case Details

Full title:GILBERT GOLDMAN v. THE HARTFORD LIFE AND ACCIDENT INSURANCE COMPANY

Court:United States District Court, E.D. Louisiana

Date published: Aug 30, 2004

Citations

Civil Action No. 03-759, Section: "R" (5) (E.D. La. Aug. 30, 2004)

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