Opinion ID: 746828
Heading Depth: 2
Heading Rank: 1

Heading: Reference To Inquiry

Text: Lien Law § 5 reads, in relevant part: 15 A person performing labor for or furnishing materials ... for the construction or demolition of a public improvement ... and any trust fund to which benefits and wage supplements are due or payable for the benefit of such person performing labor, shall have a lien for the principal and interest of the value or agreed price of such labor, including benefits and wage supplements[,] ... upon the moneys ... applicable to the construction or demolition of such improvement ... 16 N.Y. Lien Law § 5 (emphasis added). The district court concluded that since the lien law addressed any trust fund to which benefits and wage supplements are due or payable for the benefit of such [laborers], it expressly referred to ERISA plans and could be preempted on that basis alone. On appeal, the Board contends that the state's lien law, which does not expressly mention ERISA, does not refer to ERISA plans because a trust fund need not necessarily be an ERISA plan in order to reap the benefits of the statute. 17 A state law may refer to ERISA plans for preemption purposes without directly mentioning the ERISA statute. See, e.g., FMC Corp. v. Holliday, 498 U.S. 52, 55 n. 2, 59, 111 S.Ct. 403, 406 n. 2, 408, 112 L.Ed.2d 356 (1990) (statute that referred to [a]ny program, group contract or other arrangement for payment of benefits referred to ERISA plans). However, because reference to such plans generally leads to automatic preemption without any further analysis, see NYS Health Maintenance Org. Conference v. Curiale, 64 F.3d 794, 799 (2d Cir.1995) ([o]nce a statute is found to have a reference to an ERISA plan, the statute is preempted automatically; no further analysis ... is required); Dillingham, at ----, 117 S.Ct. at 838 ( 'reference' will result in preemption), we will not lightly assume that a generally worded statute that does not expressly mention ERISA by name refers to ERISA plans for purposes of preemption analysis. 18 Instead, an indirect reference will lead to that result only if it is clear that the state law, although not using the words ERISA plan, applies only to ERISA plans or requires their existence in order to operate. See Dillingham, at ---- - ----, 117 S.Ct. at 838-39. A state statute will not be preempted simply because it contains a passing mention of or allusion to ERISA--a reference justifies preemption only if the challenged statute affects ERISA plans in a practical way. See Curiale, 64 F.3d at 800. 19 A proponent of preemption relying on the reference to prong of ERISA preemption analysis thus bears the burden of proving that the challenged statute either refers solely to ERISA plans or depends as an essential part of its operation on their existence. Here, Lien Law § 5 cannot be said to depend on ERISA for an essential part of its operation, and although the lien law will undoubtedly apply primarily to ERISA plans, we are not persuaded that it can apply only to such plans. For example, because some plans are exempted from ERISA coverage and Lien Law § 5 makes no distinction between ERISA-covered and non-covered plans we cannot determine with certainty that only trust funds subject to regulation under ERISA can take advantage of the lien law's provisions. Defendants have produced no contrary evidence. Absent such evidence, it may not be concluded that the challenged provision refers to ERISA plans for purposes of preemption. See Dillingham, at ---- - ----, 117 S.Ct. at 838-39 (no reference where program need not necessarily be covered by ERISA to reap benefits of statute). 20 Thus, we are unable to adopt the trial court's view that Lien Law § 5 should be preempted because it refers to ERISA plans.