Opinion ID: 2353693
Heading Depth: 1
Heading Rank: 5

Heading: Preemption under ERISA section 514(a)

Text: ERISA section 514(a) preempts all state laws that relate to any employee benefit plan; however, laws that regulate insurance, banking, or securities are exempted from this preemption. 29 U.S.C. § 1144 (2006) (exempting laws regulating insurance, banking, or securities from this preemption); Cleghorn, 408 F.3d at 1225. Section 514(a)'s sweeping relate[d] to language cannot be read with uncritical literalism. New York State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 655-56, 115 S.Ct. 1671, 131 L.Ed.2d 695 (1995). The United States Supreme Court noted that if the statute's relate [d] to language is taken to extend to the furthest reaches imaginable, Congress's words of limitation would hold no meaning. Id. at 655, 115 S.Ct. 1671 (`[r]eally, universally, relations stop nowhere' (quoting H. James, Roderick Hudson xli (New York ed., World's Classics 1980))). Furthermore, the Court emphasized that the intent of Congress is the touchstone to preemption analysis and that, absent a clear and manifest intent of Congress, there is a presumption that federal laws do not preempt the application of state or local laws regulating matters that fall within the traditional police powers of the state, including health and safety matters. [6] Id. at 655, 661, 115 S.Ct. 1671; De Buono v. NYSA-ILA Medical and Clinical Services Fund, 520 U.S. 806, 814, 117 S.Ct. 1747, 138 L.Ed.2d 21 (1997). Remarking that it is necessary to turn from the unhelpful text of ERISA when determining the scope of ERISA's preemptive effect, the United States Supreme Court instructed that courts must be guided by the objectives of ERISA. Travelers, 514 U.S. at 656, 115 S.Ct. 1671. In its analysis of ERISA section 514(a), the Court found that the statute was intended to ensure that plans and plan sponsors would be subject to a uniform body of benefits 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 . . . [and to prevent] the potential for conflict in substantive law. . . requiring the tailoring of plans and employer conduct to the peculiarities of the law of each jurisdiction. Id. at 656-57, 115 S.Ct. 1671 (quoting Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 142, 111 S.Ct. 478, 112 L.Ed.2d 474 (1990)). The Court explained that the basic purpose of ERISA section 514(a) was to avoid multiplicity of regulation. Id. at 657, 115 S.Ct. 1671. In Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 96-97, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983), the Supreme Court explained that a law relate[s] to a covered employee benefit plan if it [(1)] has a connection with or [(2)] reference to such a plan. California Div. of Labor Standards Enforcement v. Dillingham Constr. N.A., Inc., 519 U.S. 316, 324, 117 S.Ct. 832, 136 L.Ed.2d 791 (1997). Thus, in determining whether a state law would survive section 514(a) preemption, a court must look at the actual operation of the state statute. De Buono, 520 U.S. at 815, 117 S.Ct. 1747.