Opinion ID: 421887
Heading Depth: 1
Heading Rank: 2

Heading: Proceedings in State and District Courts

Text: 9 Sly and Schneider brought this action in state court on behalf of themselves and other Mallory employees similarly situated, alleging breach of a contractual obligation to award them severance pay. The claim was certified by the state court as a class action. In an amended complaint a second count was added, alleging that Mallory had adopted a written severance pay policy which was an employee welfare benefit plan within the meaning of the Employee Retirement Income Security Act of 1974. (ERISA) 29 U.S.C. §§ 1001 et seq. 10 The action was then removed to the United States District Court, Southern District of Indiana, Indianapolis Division. The parties filed cross-motions for summary judgment. In its findings of fact and conclusions of law the court held that the state law breach of contract claim alleged in Count I had been preempted by ERISA, and that Count II, the ERISA claim, was without merit because Mallory's decision to deny benefits to plaintiffs was not arbitrary or capricious. The action was dismissed with prejudice.