Opinion ID: 3065104
Heading Depth: 4
Heading Rank: 2

Heading: Davila’s Second Prong

Text: The question under the second prong of Davila is whether “there is no other independent legal duty that is implicated by a defendant’s actions.” 542 U.S. at 210. If there is some other independent legal duty beyond that imposed by an ERISA plan, a claim based on that duty is not completely preempted under § 502(a)(1)(B). For the reasons that follow, we conclude that the Hospital’s claims in this suit are based on independent legal duties. In this suit now before us, the Hospital asserts state-law claims. These claims do not rely on, and are independent of, any duty under an ERISA plan. In Davila, plaintiffs argued that a state statute created an independent legal duty. But the Court noted that the statute did not create any legal duty where, as had occurred in Davila, there had been a denial of coverage under the terms of an ERISA plan. The state statute imposed only an obligation to make the payments required under the plan. Thus, in Davila, there was no independent legal duty imposed under state law. In this case, by contrast, the Hospital contends that MBAMD entered into an independent oral contract during the April 8 telephone call. The various state-law claims asserted by the Hospital all arise out what was allegedly said during that call. [10] Defendants contend that since the remedy the Hospital seeks — the payment of money — is the same as a possible remedy under § 502(a)(1)(B), the Hospital’s suit amounts to a claim under § 502(a)(1)(B). This misunderstands the nature of the second prong of the Davila test. Under this prong, we ask only whether “there is no other independent legal duty that is implicated” by a defendant’s actions. We do not ask whether that legal duty provides for a similar remedy, such as the payment of money. Defendants also continue to confuse conflict preemption under § 514(a) with complete preemption under § 502(a)(1)(B). It is not enough for complete preemption that the contract and tort claims “relate to” the underlying 13186 MARIN GENERAL v. MODESTO & EMPIRE TRACTION ERISA plan, or that ERISA § 502(a)(1)(B) may provide a similar remedy. The question under the second prong of Davila is whether the complaint relies on a legal duty that arises independently of ERISA. Since the state-law claims asserted in this case are in no way based on an obligation under an ERISA plan, and since they would exist whether or not an ERISA plan existed, they are based on “other independent legal dut[ies]” within the meaning of Davila. [11] We conclude that the Hospital’s state-law claims based on its alleged oral contract with EBAMD were based on an independent legal duty, and that the Hospital’s claims therefore do not satisfy the second prong of Davila.