Opinion ID: 1681928
Heading Depth: 1
Heading Rank: 1

Heading: the facts and nature of the dispute

Text: Dale Gorman was killed in an automobile collision in Houston. He was an employee of Tenneco, Inc., and was insured under an insurance policy issued by Life Insurance Company of North America (LINA); the policy was provided for Gorman by Tenneco. Pamela Chambers Gorman, his wife, and Amanda Marie Gorman, his minor daughter, the designated beneficiaries under this policy, claimed that Gorman's death was covered under the policy and sought benefits. LINA, acting upon Tenneco's recommendation, denied coverage. Thereafter, petitioners filed this lawsuit against both Tenneco and LINA alleging numerous causes of action. On appeal, based on the jury verdict, they seek judgment against Tenneco for breach of fiduciary duties and against LINA for breach of contract, violation of Texas Insurance Code article 3.62 and gross negligence. Among the items of damages they seek to recover are attorney's fees, prejudgment interest, mental anguish and exemplary damages for gross negligence. Tenneco and LINA contend that petitioners' causes of actions are preempted by ERISA because they relate to an employee benefit welfare plan organized pursuant to the authority and requirements of ERISA. See 29 U.S.C. § 1144(a) (1988); Cathey v. Metropolitan Life Ins. Co, 805 S.W.2d 387, 389-90 (Tex. 1991). In the event the court finds that petitioners' claims are not preempted, the respondents also argue that there was no evidence to support the jury finding that Dale Gorman was in travel or sojourn on the business of Tenneco at the time of his accident. ERISA explicitly supersedes or preempts state laws to the extent that they relate to employee benefit plans not exempt from federal regulation. Id. This preemption provision is modified by a socalled saving clause which provides that state laws regulating insurance, banking, or securities are not preempted. See id. § 1144(b)(2)(A). Because ERISA's preemption and saving clauses perhaps are not a model of legislative drafting, disputes as to the nature of their effect are becoming commonplace. Metropolitan Life Ins. Co. v. Massachusetts, 471 U.S. 724, 739, 105 S.Ct. 2380, 2388, 85 L.Ed.2d 728 (1985). In the instant case, we are called upon to decide the nature of ERISA's preemptive effect. At the heart of the present dispute is whether, given the facts of this case, ERISA preemption implicates the subjectmatter jurisdiction of the court or merely affects which law is to be used in the case. A preemption argument that affects the choice of forum rather than the choice of law is not waivable and can be raised for the first time on appeal. See International Longshoremen's Ass'n v. Davis, 476 U.S. 380, 397, 106 S.Ct. 1904, 1915, 90 L.Ed.2d 389 (1986); Gilchrist v. Jim Slemmons Imports, Inc., 803 F.2d 1488, 1497 (9th Cir.1986); see also Dueringer v. General Am. Life Ins. Co., 842 F.2d 127, 130 (5th Cir.1988); Castillo v. Neely's TBA Dealer Supply, Inc., 776 S.W.2d 290, 292 (Tex.App.Houston [1st Dist] 1989, writ denied); Great N. Am. Stationers, Inc. v. Ball, 770 S.W.2d 631, 632 (Tex.App.Dallas 1989, writ dism'd as moot). LINA and Tenneco contend that the preemptive effect of ERISA in this case was invoked by their repeated objections in the trial court that petitioners' causes of action were preempted by ERISA, and that its invocation deprived the trial court of subject-matter jurisdiction over the case. Alternatively, both LINA and Tenneco maintain that, because ERISA's preemptive effect deprives the trial court of subjectmatter jurisdiction, they need not have raised ERISA preemption at trialmatters going to the subject-matter jurisdiction of the court may be raised for the first time on appeal. See Texas Employment Comm'n v. International Union of Elec, Radio & Mack Workers Local 782, 163 Tex. 135, 352 S.W.2d 252, 253 (1961). Petitioners assert that ERISA preemption, to the extent that it is applicable, merely affects which law is to be used in the case; it does not deprive the court of subject-matter jurisdiction. They reason that unless the cause of action alleged is created by ERISA or contains a right or immunity created by ERISA as an element, the suit is not brought under ERISA [4] and thus is not within the exclusive jurisdiction of the federal courts. Accordingly, they maintain that ERISA must be pleaded and proved or it is waived.