Opinion ID: 779517
Heading Depth: 3
Heading Rank: 2

Heading: The Lawsuit and the Subsequent Settlement

Text: 11 On October 21, 1996, while Equitable was reviewing the agents' claims, Plaintiffs filed this class action in California Superior Court alleging two claims for breach of contract. 2 The first claim (Count One) related to Equitable's freeze of the premium base for calculating insurance agents' commissions on medical policies. The second claim (Count Two) involved Equitable's alleged breach of its promise to provide health benefits to certain agents. 12 Equitable removed the action to federal court on the grounds that Count Two was completely preempted by ERISA and that there was diversity jurisdiction. Plaintiffs responded with a motion to remand the case to state court. Concluding that it had federal question jurisdiction, the district court denied the motion to remand. 13 On November 6, 1996, Equitable's counsel informed Plaintiffs that Equitable was concerned about Count One and might agree to settle it. It was not until February 5, 1997, however, approximately three and one-half months after the lawsuit was filed and four and one-half months after negotiations began, that Equitable announced that it would settle Count One by ending the freeze.