Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caed-2_05-cv-00309/USCOURTS-caed-2_05-cv-00309-0/pdf.json

Parties Involved:
California Association of Professional Firefighters
Defendant
Dean W. Hutton
Plaintiff

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1

UNITED STATES DISTRICT COURT

EASTERN DISTRICT OF CALIFORNIA

DEAN W. HUTTON,

2:05-CV-0309-MCE-KJM

Plaintiff,

v. MEMORANDUM AND ORDER

CALIFORNIA ASSOCIATION OF

PROFESSIONAL FIREFIGHTERS; and

DOES 1 through 20 inclusive,

Defendant.

----oo0oo----

Plaintiff Dean W. Hutton ("Hutton") is seeking relief on the

ground that Defendant California Association of Professional

Firefighters (“CAPF”) breached its long term disability contract

with him and violated the covenant of good faith and fair dealing

by failing to pay benefits due him under the plan. CAPF now

moves to dismiss Hutton’s claim or, in the alternative, to strike

his demand for punitive damages. Neither party disputes, and the

Court finds, that the plan is exclusively governed by the

Employee Retirement Income Security Act (“ERISA”), 29 U.S.C.S.

§1001 et. seq.

Case 2:05-cv-00309-MCE -KJM Document 17 Filed 03/17/06 Page 1 of 6
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Because oral argument will not be of material assistance, 1

the Court orders this matter submitted on the briefs. E.D. Cal.

Local Rule 78-230(h). 

2

For the reasons set forth below, CAPF’s Motion to Dismiss is

granted without leave to amend and without prejudice.1

BACKGROUND

Hutton is a retired firefighter who was a member of

Defendant California Association of Professional Firefighters. 

CAPF is an association that operates a long term disability plan

(“Plan”) to which Hutton subscribed. Hutton alleges that, during

a period of coverage, he became totally disabled entitling him to

disability benefits.

On or about April 14, 2001, Hutton began to receive benefits

pursuant to the Plan. Two months later, Hutton began receiving

disability retirement income from California Public Employees

Retirement System which triggered a recalculation of benefits

owed him under the Plan. Hutton alleges that CAPF made an error

in its recalculation of his disability benefits forcing him to

institute an investigation to rectify the claimed error.

On or about July of 2002, CAPF terminated Hutton’s benefits

entirely claiming he had received all benefits due him under the

Plan. After investigating the matter, CAPF restored Hutton’s

disability benefits. In January 2003, however, his benefits were

once again terminated on the ground that Hutton did not qualify

for “All Occupation Disability.”

///

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3

Pursuant to the Plan, if a participant’s claim is denied,

the participant may appeal that denial by filing a written

request for review to the Plan’s Board of Directors within thirty

days following the denial. Ex. 1 to Complaint, p. 10-11. If a

dispute continues beyond the completion of any review process,

both parties must use their best efforts for a period of thirty

days to resolve the dispute through negotiations. Id. If the

parties are unable to reach an agreement after the negotiation

period, either party may institute legal proceedings. Id. 

On August 8, 2003, Hutton sent a letter to CAPF seeking an

appeal of Defendant's decision to deny him benefits. Floyd Decl.

in Support of Defendant’s Motion to Dismiss, Exhibit H (“Floyd

Decl.”). After numerous exchanges of correspondence, an appeal

hearing was scheduled and, ultimately, held on April 7, 2004. 

Floyd Decl. at 5. The matter was taken under submission at the

conclusion of the hearing. Id. Hutton filed suit in the

Superior Court on October 8, 2004. On February 17, 2005,

Defendants officially denied Hutton's claim concluding his

appeal.

STANDARD

In moving to dismiss for lack of subject matter jurisdiction

pursuant to Rule 12 (b)(1), the challenging party may either make

a “facial attack” on the allegations of jurisdiction contained in

the complaint or can instead take issue with subject matter

jurisdiction on a factual basis (“factual attack”).

///

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4

Thornhill Publ’n Co. v. Gen. Tel. & Elect. Corp., 594 F.2d 730,

733 (9 Cir. 1979); Mortensen v. First Fed. Sav. & Loan Ass’n,

th

549 F.2d 884, 891 (3d Cir. 1977). If the motion constitutes a

facial attack, the Court must consider the factual allegations of

the complaint to be true. Williamson v. Tucker, 645 F.2d 404,

412 (5 Cir. 1981); Mortensen, 549 F.2d at 891. If the motion th

constitutes a factual attack, however, “no presumptive

truthfulness attaches to plaintiff’s allegations, and the

existence of disputed material facts will not preclude the trial

court from evaluating for itself the merits of jurisdictional

claims.” Thornhill, 594 F.2d at 733 (quoting Mortensen, 549 F.2d

at 891).

If the Court grants a motion to dismiss a complaint, it must

then decide whether to grant leave to amend. Generally, leave to

amend should be denied only if it is clear that the deficiencies

of the complaint cannot be cured by amendment. Broughton v.

Cutter Labs., 622 F.2d 458, 460 (9th Cir. 1980).

ANALYSIS

CAPF argues that Hutton failed to exhaust his administrative

remedies before bringing the present action depriving this Court

of subject matter jurisdiction. Subject matter jurisdiction is

to be determined at the time the complaint is filed. In re

Fietz, 852 F.2d 455, 456 (9th Cir. 1988).

///

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5

CAPF correctly points out that under ERISA, employee benefit

plans are required to provide internal dispute resolution

procedures for participants whose claims have been denied. See

29 U.S. C. § 1133. The Ninth Circuit has clarified that an ERISA

plan participant must avail himself or herself of a plan's own

internal review procedures before bringing suit in federal court. 

Diaz v. United Agric. Employee Welfare Benefit Plan & Trust, 50

F.3d 1478, 1483 (9th Cir. 1995). Accordingly, to survive CAPF’s

Motion to Dismiss, Hutton must show that at the time his

Complaint was filed, he had exhausted his administrative remedies

under the Plan. 

Hutton does not address CAPF’s contention that he failed to

exhaust his administrative remedies. Rather, Hutton merely avers

that CAPF’s motion should be denied because his Complaint meets

the pleading requirements of Federal Rule of Civil Procedure 8. 

Even assuming Hutton’s assertion to be true, a properly pleaded

complaint does nothing to solve this jurisdictional defect. 

Indeed, in order to save this action, Hutton must establish

either exhaustion of his administrative remedies or a valid

justification for failing to do so.

As noted above, Hutton filed the present action on October

8, 2004. However, the record establishes that his appeal had not

yet concluded. Specifically, in a letter dated January 18, 2005,

Hutton asked "What is the status of the Appeal?" Floyd Decl.,

Exhibit T. This letter was advanced to CAPF two months

subsequent to the initiation of this litigation. Again, in a

letter dated February 15, 2005, Hutton acknowledged that his

appeal was still pending. Floyd Decl., Exhibit V.

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Because Plaintiff filed his Complaint before he had exhausted his

administrative remedies, this Court lacks subject matter

jurisdiction. As a result, Hutton’s Complaint must be dismissed.

Further, because Hutton can plead no set of facts that will

cure this jurisdictional defect, his claims for breach of

contract and breach of the implied covenant of good faith and

fair dealing must be dismissed without leave to amend. In light

of the foregoing, the Court need not reach CAPF’s Motion to

Strike punitive damages.

CONCLUSION

For the reasons fully explained above, CAPF’s Motion to

Dismiss is GRANTED without leave to amend and without prejudice.

IT IS SO ORDERED.

DATED: March 15, 2006

_____________________________

MORRISON C. ENGLAND, JR

UNITED STATES DISTRICT JUDGE

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