In the

United States Court of Appeals

For the Seventh Circuit

____________

No. 03-2832

JUSTIN HART,

Plaintiff-Appellee,

v.

WAL-MART STORES, INC. ASSOCIATES’ HEALTH

AND WELFARE PLAN,

Defendant-Appellant.

____________

Appeal from the United States District Court

for the Central District of Illinois.

No. 02-4053—Michael M. Mihm, Judge.

____________

ARGUED JANUARY 20, 2004—DECIDED MARCH 1, 2004

____________

Before CUDAHY, KANNE, and EVANS, Circuit Judges.

CUDAHY, Circuit Judge. Yogi Berra might describe this

case as “deja vu all over again.” For if the case seems familiar, it may be because we have decided the precise

question presented in this appeal twice before—both times

under virtually identical circumstances—and most recently,

against the same appellant. See Speciale v. Seybold, 147

F.3d 612 (7th Cir. 1998); Blackburn v. Sunstrand Corp., 115

F.3d 493 (7th Cir. 1997). In both of these earlier cases we

held that a petition to apportion claims to a settlement fund
2 No. 03-2832

between an ERISA plan subrogation claim and other

lienholders was not preempted by ERISA’s civil enforcement provision and the allocation of the funds was a matter

for determination in the state court. In the present case,

Wal-Mart asks us to re-reconsider the issue, this time in the

context of an award of $11,500 in attorney’s fees, which the

district court taxed against Wal-Mart under 28 U.S.C. §

1447(c). After serious consideration (mainly of the possibility of sanctioning Wal-Mart for bringing this presumptuous

appeal), we reaffirm our previous holdings in Blackburn

and Speciale and affirm the order of the district court. 

I.

On December 25, 1999, Appellee Justin Hart suffered

permanent brain injury in an automobile accident with

Robert Chinn. As a result of his injuries, Hart received

substantial medical treatment and incurred certain resulting liens. At the time of the accident, Hart was an

employee of Wal-Mart Stores. Blue Cross/Blue Shield is the

third-party administrator of the Wal-Mart Stores Associates’ Health and Welfare Plan, an employee welfare

benefits plan governed by the Employee Retirement Income

Security Act of 1974 (ERISA). The Plan paid out $61,475.45

in medical benefits for the treatment stemming from his

injuries. 

Hart filed a tort suit against Chinn in the Circuit Court

of Rock Island County and ultimately obtained a settlement

in the amount of $180,000. After reaching this settlement,

Hart filed a petition in the state court to adjudicate the

liens of six separate lienholders, including Blue Cross/Blue

Shield as Administrator of the Plan (hereinafter Wal-Mart).

Wal-Mart’s plan included a “right to reduction, reimbursement and subrogation” provision. Wal-Mart Br. at 4. WalMart believed that unlike federal law, Illinois state law

allowed common fund reductions for attorney’s fees even
No. 03-2832 3

when the plan’s terms expressly disclaimed the doctrine.

Thus, in an apparent effort to take advantage of the more

favorable federal law, Wal-Mart independently removed the

case to the Central District of Illinois pursuant to 28 U.S.C.

§ 1441(a), (b) and (c), arguing that Hart’s claim was completely preempted by ERISA. 

Hart filed a motion to remand on July 17, 2002, arguing

that the district court lacked subject matter jurisdiction. In

an order dated December 23, 2002, the district court ordered that the case be remanded. The district court relied

on our holdings in Blackburn and Speciale in finding that

ERISA preemption was not applicable. Moreover, the

district court noted that the case had not been properly

removed under 18 U.S.C. § 1441 because Wal-Mart failed to

join the other lienholders in its notice of removal. 

Thereafter, Hart filed a petition pursuant to 18 U.S.C.

§ 1447(c), seeking $13,750 in attorney’s fees and costs for

improper removal. Wal-Mart opposed this petition, arguing

that (1) Hart had not submitted any evidence of a reasonable hourly rate; (2) Hart’s counsel’s claimed tasks were

insufficiently documented; (3) Hart’s counsel’s time entries

were excessive; and (4) Hart’s bill of costs should be denied.

In an order dated April 28, 2003, the district court awarded

$11,500 in attorney’s fees. This appeal followed. 

II.

1. Jurisdiction

An order remanding a case to the state court from which

it was removed is generally not subject to appeal. 28 U.S.C.

§ 1447(d). The purpose of precluding review is to avoid the

delay that might be caused by prolonged federal litigation

of jurisdictional questions. See Matter of Amoco Petroleum

Additives Co., 964 F.2d 706, 708 (7th Cir. 1992); Mobile

Corp. v. Abeille Geberal Ins. Co., 984 F.2d 664, 666 (5th Cir.
4 No. 03-2832

1 The contrary rule would violate the purposes of 28 U.S.C.

§ 1447. If this Court were to vacate an award of attorney’s fees,

finding that remand was improper, and our decision could later be

used by the removing party to attempt to return to federal court,

proceedings might be slowed in the state court while the parties

continue...

1993); Appalachian Volunteers, Inc. v. Clark, 432 F.2d 530

(6th Cir. 1970); In re MacNeil Bros. Co., 259 F.2d 386, 388

(1st Cir. 1958). However, it is well-settled that an award of

attorney’s fees occasioned by a wrongful removal is an

independently appealable order not subject to the prohibition against reviewing a remand order. See Garbie v.

DaimlerChrysler Corp., 211 F.3d 407, 409-10 (7th Cir.

2000); LaMotte v. Roundy’s, Inc., 27 F.3d 314, 315 (7th Cir.

1994). 

It is equally clear that an evaluation of the merits of a

remand order may be required to determine whether the

district court’s award of attorney’s fees was appropriate. See

Sirotzky v. New York Stock Exch., 347 F.3d 985, 987 (7th

Cir. 2003) (“[P]laintiff must show the remand order was

correct (that is, that removal was improper) . . .”); Moore v.

Permanente Med. Group, 981 F.2d 443, 447 (9th Cir. 1992)

(“[S]ome evaluation of the merits of the remand order is

necessary to review an award of attorney’s fees . . .”);

Roxbury Condo. Ass’n, Inc. v. Anthony S. Cupo Agency, 316

F.3d 224, 227 (3d Cir. 2003); Miranti v. Lee, 3 F.3d 925,

927-28 (5th Cir. 1993). This merits review does not conflict

with the purpose of 28 U.S.C. § 1447(d) because the state

court action may proceed expediently while the appellate

court reviews the award of attorney’s fees. Even if the

appellate court determines that it was an abuse of discretion to award attorney’s fees because the decision to remand

was improper, the remand itself may not be disturbed. See

Dahl v. Rosenfeld, 316 F.3d 1074, 1079 (9th Cir. 2003);

Roxbury Condo., 316 F.3d at 227-28.1
No. 03-2832 5

...continue

and the court waited for the federal circuit court’s blessing.

Moreover, under the contrary rule, plaintiffs would be reluctant

to ever seek attorney’s fees based on improper removal because of

the risk of upsetting the remand order. The result would be open

season for defendants to attempt to frivolously remove state court

cases. 

Generally, we review a district court’s award of attorney’s

fees for abuse of discretion. See Tenner v. Zurek, 168 F.3d

328, 329 (7th Cir. 1999). However, “[a] district court would

necessarily abuse its discretion if it based its ruling on an

erroneous view of the law . . . .” Cooter & Gell v. Hartmarx

Corp., 496 U.S. 384, 405 (1990); Salgado by Salgado v. Gen.

Motors Corp., 150 F.3d 735, 739 n.4 (7th Cir. 1998). If

removal is found to be improper, the plaintiff is presumptively entitled to an award of fees. See Sirotzky, 347 F.3d at

987.

2. Waiver

As an initial matter, Hart argues that Wal-Mart waived

its argument by not specifically reiterating it in opposing

attorney’s fees. Hart Br. at 8-11. It is true that in opposing

attorney’s fees below, Wal-Mart attacked only the amount

of the fees rather than the merits of the remand order.

However, Hart does not dispute that Wal-Mart actively

contested and lost the issue whether removal was proper

before opposing the award of attorney’s fees. After WalMart had made its position plain and lost the issue on the

merits, it would be senseless to require that Wal-Mart

reiterate its argument in a futile effort to oppose attorney’s

fees. See, e.g., Dawson v. New York Life Ins. Co., 135 F.3d

1158, 1166 (7th Cir. 1998) (rejecting a similar waiver argument and noting that “at some point further objection
6 No. 03-2832

became useless”); Dresser Indus. Inc. v. The Gradall Co.,

965 F.2d 1442, 1450 (7th Cir. 1992) (same). Hart cannot

claim that he was prejudiced in any way by Wal-Mart’s

decision not to beat a dead horse in the district court. Nor

did Wal-Mart’s decision deprive the district court of a

meaningful opportunity to review the issue of subject matter jurisdiction. Therefore, we find that Wal-Mart did not

waive its argument.

3. Attorney’s fees

To determine whether the district court’s award of attorney’s fees was appropriate, we must decide whether the

district court properly found that it lacked subject matter

jurisdiction. When determining whether federal jurisdiction

exists, we must follow the well-pleaded complaint rule,

which states that federal question jurisdiction exists only

“when the plaintiff’s well-pleaded complaint raises issues of

federal law.” Metro. Life Ins. Co. v. Taylor, 481 U.S. 58, 63

(1987); Jass v. Prudential Health Care Plan, Inc., 88 F.3d

1482, 1486 (7th Cir. 1996) (“The issues raised in the

plaintiff’s complaint, not those added in the defendant’s

response, control the litigation.”). “The paramount policies

embodied in the well-pleaded complaint rule [are] that the

plaintiff is master of the complaint . . . and that the plaintiff

may, by eschewing claims based on federal law, choose to

have the cause heard in state court.” Caterpillar, Inc. v.

Williams, 482 U.S. 386, 398-99 (1987). 

However, there is an exception to the well-pleaded complaint rule, known as the “complete preemption doctrine”

which provides that, where Congress has completely preempted a given area of state law, a plaintiff’s state law

claim will be “recharacterized” as a federal claim so that

removal becomes proper. See Avco Corp. v. Aero Lodge No.

735 Int’l Ass’n of Machinists and Aerospace Workers, 390
No. 03-2832 7

U.S. 557, 560 (1968). The Supreme Court has determined

that all state actions falling within the scope of section

502(a) of ERISA, 29 U.S.C. § 1132(a), are preempted under

the complete preemption doctrine. Taylor, 481 U.S. at 67.

Section 502(a) provides that “[a] civil action may be

brought—(1) by a participant or beneficiary—(A) for the

relief provided in subsection (c) of this section, or (B) to

recover benefits due to him under the terms of his plan, to

enforce his rights under the terms of the plan, or to clarify

his rights to future benefits under the terms of the plan.” 29

U.S.C. § 1132(a). Therefore, any claim by a participant or

beneficiary to enforce his rights under an ERISA plan is

completely preempted, and federal subject matter jurisdiction would exist. See Jass, 88 F.3d at 1487. 

Wal-Mart argues that complete preemption under

§ 502(a) applies here. The problem for Wal-Mart is that we

have already decided in two nearly identical cases that it

does not. See Speciale, 147 F.3d at 615; Blackburn, 115 F.3d

at 495. In Blackburn, the plaintiffs were injured in an

automobile accident with another driver. Under their benefits plan, covered by ERISA, Sunstrand paid $25,000 to the

plaintiffs in medical benefits. The plaintiffs filed a tort

action against the other driver in state court and obtained

a $105,000 settlement. Pursuant to a subrogation clause,

Sunstrand claimed a right to a portion of the settlement.

The plaintiffs’ lawyer also claimed a right to a portion of the

fund. The plaintiffs filed a petition to apportion the fund in

the state court. Sundstrand removed the case to federal

court under 28 U.S.C. §1441(b). The district court determined that it had subject matter jurisdiction by virtue of

the complete preemption doctrine. We reversed, holding

that

[t]he “civil action” was the tort suit by the Blackburns

against the other driver, which assuredly did not arise

under the Constitution, treaties, or laws of the United

States. Not even the most expansive reading of ERISA
8 No. 03-2832

covers motor vehicle collisions, just because part of the

recovery may inure to the benefit of the plan. The

petition to apportion the fund invoked the ancillary

jurisdiction of the state court and was part of that

original, non-removable action. 

Blackburn, 115 F.3d at 494. A year later, in Speciale, the

appellant, also an employee of Wal-Mart, sustained injuries

and incurred medical expenses in an automobile accident

totaling $70,563.91. Speciale, 147 F.3d at 614. Wal-Mart’s

health plan, covered by ERISA, paid $54,051.07 towards the

cost of Speciale’s medical bills, with $16,512.84 remaining

unpaid. The fifteen unpaid providers filed liens, as allowed

under Illinois statutes. Speciale filed a personal injury

action against the other driver in Illinois state court and

accepted $45,000 in settlement. Wal-Mart sent Speciale a

notice indicating that, pursuant to the terms of its plan, it

was entitled to reimbursement from the settlement.

Speciale filed a motion to adjudicate in state court, which

notified the court of the settlement and requested the court

to apportion the fund amongst Wal-Mart and the 16

providers asserting claims against the settlement fund.

Wal-Mart removed the action to federal court under 28

U.S.C. § 1441(b), maintaining that because the Plan arose

under and was governed by ERISA, the motion to adjudicate was completely preempted. The district court agreed

with Wal-Mart. On appeal, we reversed again, following

Blackburn. We noted that

[a]lthough Speciale was a plaintiff entitled to bring a

claim under the Wal-Mart plan, her claim of personal

injury was not a cause of action that falls within the

scope of an ERISA provision nor did her state claim

require resolution of an interpretation of the contract

governed by federal law . . . . [N]either can Speciale’s

request for apportionment be recharacterized as a suit

to enforce her rights under the terms of the Plan and

cannot be completely preempted under § 502(a).
No. 03-2832 9

Speciale, 147 F.3d at 615-16. Wal-Mart does not deny that

the facts of this case are indistinguishable from Speciale

and Blackburn. In the face of such clear precedent, WalMart nonetheless argues that the district court abused its

discretion based on two out-of-circuit cases which had not

yet been decided at the time the district court awarded

attorney’s fees. See Arana v. Ochsner Health Plan, 338 F.3d

433, 440 (5th Cir. 2003); Singh v. Prudential Health Care

Plan, Inc., 335 F.3d 278, 291-92 (4th Cir. 2003). There are

at least two major problems with this argument. First,

absent a change in the state of the law, it would generally

be an abuse of discretion for a district court to follow out-ofcircuit precedent which conflicts with binding precedent

from its own circuit. See, e.g., United States ex rel.

Schnitzler v. Follette, 406 F.2d 319, 322 (2d Cir. 1969) (“In

this case, as in all others, the district court is required to

follow a binding precedent of a superior court, and it abused

its discretion in declining to do so.”); cf. Rendish v. City of

Tacoma, 123 F.3d 1216, 1226 (9th Cir. 1997) (holding that

district court did not abuse its discretion by refusing to

apply out-of-circuit precedent where there was controlling

precedent within the circuit). 

More importantly, Arana and Singh are completely

distinguishable from the present case. In Arana, the plaintiff filed a state-law claim in state court against the plan

itself, seeking a declaration that the plan could not obtain

reimbursement from the tort settlement. See Arana, 338

F.3d at 434. Similarly, in Singh, the plaintiff filed a state

claim seeking reimbursement of monies that she had paid

to Prudential pursuant to a subrogation term of the plan.

Singh, 335 F.3d at 280. The plaintiff’s complaint alleged

that the subrogation provision was illegal under state

law. Id. In both of these cases, it was clear from the face

of the complaint that the plaintiffs were challenging the

plan’s right to subrogation. In the present case, however,
10 No. 03-2832

2 Wal-Mart seems to argue here that Hart implicitly challenges

the plan’s right to subrogation by bringing the action in state

court because Illinois state law allows common fund reductions

even when the plan term disclaims the doctrine, in contrast to

federal law. Wal-Mart cites no authority which would suggest that

we can base subject matter jurisdiction on such an implication. In

any case, we find no such implication here. It is only logical that

Hart would seek to have the state court which adjudicated his tort

claim apportion the resulting settlement fund. 

Wal-Mart further argues that this result creates an impermissible incentive for forum shopping and encourages a race to the

courts, with the health plans running to federal court and plaintiffs running to state court. While this may be an unfortunate

result, it does not follow that the proper way to address the

problem is to extend federal subject matter jurisdiction, thereby

making state law irrelevant. The more logical solution and the one

which we would encourage, would be for federal courts to defer,

under such circumstances, to the state court in which the original

suit was filed. 

the plaintiff is not contesting the right to subrogation but

simply seeks to apportion the settlement fund amongst his

various creditors. See Serraiocco v. Seba, 286 F. Supp. 2d

860, 865 (E.D. Mich. 2003) (distinguishing Arana and noting that “the plaintiffs in Arana . . . brought suit for the sole

purpose of determining the validity of an ERISA plan’s

reimbursement provision, while the Plan here has injected

the issue of reimbursement into the tail end of a state-court

tort action that the parties have agreed to settle.”).2

Wal-Mart also argues that Speciale and Blackburn are

not controlling here because the analysis in those cases was

limited to § 502(a)(1)(B), whereas Hart’s claim is capable of

being recharacterized as a claim falling within the scope of

§ 502(a)(3). Wal-Mart Br. at 15. Section § 502(a)(3) authorizes a participant, beneficiary, or fiduciary to “(A) enjoin

any act or practice that violates any provision of this title or
No. 03-2832 11

3 Because we find that the district court correctly held that the

complete preemption doctrine does not apply, we need not address

the district court’s alternative holding that Wal-Mart did not meet

the procedural hurdles of the removal statute by failing to join the

other state court defendants in the removal. Because 28 U.S.C.

§ 1441 does not confer jurisdiction, the disposition of this alternative holding does not affect our decision today. 28 U.S.C. §1441(c)

(“Whenever a separate and independent claim or cause of action

within the jurisdiction conferred by section 1331 of this title is

joined with one or more otherwise non-removable claims or causes

of action, the entire case may be removed . . . .”) (emphasis added);

28 U.S.C. §1441(b) (“Any civil action of which the district courts

have original jurisdiction . . . shall be removable . . . .”) (emphasis

added).

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 title or the terms of the plan.”

§ 502(a)(3)(B). However, as the district court properly

found, § 502(a)(3) does not apply because the plaintiff here

“is clearly not seeking to redress an ERISA violation or to

enforce any ERISA provisions or terms of the Plan.” Hart

Br. at A18. Wal-Mart relies on dicta from Rush Prudential

HMO, Inc. v. Moran, 536 U.S. 355, 363 n.2 (2002), but Rush

is distinguishable because it was based on “a suit to compel

compliance with [a state insurance statute] in the context

of an ERISA plan.” Id. In the present case, as we have

noted, Hart is merely seeking apportionment of his settlement fund. Moreover, as Wal-Mart concedes, this Court has

never addressed whether the complete preemption doctrine

even applies to claims falling within the scope of § 502(a)(3).

Therefore, we find that Wal-Mart’s arguments are without merit, and the district court did not abuse its discretion

in awarding attorney’s fees.3

 For the foregoing reasons, we

AFFIRM the district court’s award of attorney’s fees to the

plaintiff.
12 No. 03-2832

A true Copy:

Teste: 

 ________________________________

Clerk of the United States Court of

Appeals for the Seventh Circuit 

USCA-02-C-0072—3-1-04