Opinion ID: 995857
Heading Depth: 3
Heading Rank: 2

Heading: Detrimental reliance on oral representations

Text: Plaintiffs next contend that Margaret Tew (Tew), an employee of SEANC in charge of insurance, made oral representations that conflicted with the written terms of the Plan. (J.A. at 119.) Plaintiffs allege that Iris Leary detrimentally relied upon the representations of Tew made on November 12, 1991, that the Member Only coverage for which Otley Leary enrolled was authorized under the Plan. Plain_________________________________________________________________ 6 On August 1, 1991, Iris Leary enrolled in the Plan as an employee of the state of North Carolina. As a retired employee of the state of North Carolina, Otley Leary was eligible to enroll in the Plan, which allows active and retired dues-paying members of SEANC to enroll. (J.A. at 161.) 7 tiffs further assert that this reliance amounted to equitable estoppel and that Tew's oral assurances that both Member Only and Member and Family coverages were allowed under the Plan constitute an estoppel to any denial of coverage. As a consequence, Plaintiffs argue that the defendants should be held liable under the policy for which Plaintiffs were beneficiaries. Plaintiffs maintain that the principles of the federal common law of equitable estoppel create an avenue of recovery for plaintiffs in ERISA cases. Plaintiffs rely on our holding in Elmore v. Cone Mills Corp., 23 F.3d 855 (4th Cir. 1994), that is inapposite to the present controversy. In Elmore , [T]his court, sitting en banc, addressed the question of whether estoppel principles could be used to bind a plan fiduciary to oral modifications made before terms of the plan were written down and became binding. The plan at issue in Elmore was adopted subsequent to the contract that formed the basis for the plaintiff's estoppel claim. Thus, the alleged beneficiaries in Elmore did not seek to alter a preexisting ERISA plan, they merely asked that a contract entered into prior to the ERISA plan's adoption be given binding effect. . . . In Coleman v. Nationwide Life Ins. Co., we held that estoppel principles cannot be used to effect a modification of an existing ERISA benefit plan. In such a case, adoption of an estoppel theory would require this court to rewrite the contract of insurance. HealthSouth Rehabilitation Hosp. v. American Nat'l Red Cross, 101 F.3d 1005, 1010 (4th Cir. 1996) (emphasis added, internal citations omitted). Thus, Elmore is distinguishable on its facts from the present controversy. Here, Plaintiffs wish to apply estoppel principles to oral representations Tew allegedly made on November 12, 1991 to modify a pre-existing ERISA Plan that was entered on September 1, 1991. (J.A. at 119, 158.) Unlike Elmore, where plaintiffs did not seek to alter a pre-existing ERISA plan [but] merely asked that a contract entered prior to the ERISA plan's adoption be given binding effect, Plaintiffs seek to modify an unambiguous pre-existing Plan. HealthSouth, 101 F.3d at 1010. Because the en banc panel was evenly divided, Elmore carries no precedental weight. Id. at 1010. Therefore, Plaintiffs' reli- 8 ance on Elmore is misplaced. Thus, we reject Plaintiffs' claim of equitable estoppel based on Tew's subsequent oral representations that conflicted with the written terms of the Plan. C. Improper retention of jurisdiction by the district court Plaintiffs next allege that the district court erred by failing to remand the matter to state court. Under Section 502(e) of ERISA, 29 U.S.C.A. § 1132(e), state and federal courts have concurrent jurisdiction over individual claims for benefits under an ERISA plan, or to enforce rights under an ERISA plan. Federal district courts have exclusive jurisdiction over all other claims authorized by Section 502 of ERISA, 29 U.S.C.A. § 1132(e)(1). Therefore, the district court properly retained jurisdiction. In addition, claims filed in state court can be removed to federal court any time the state law cause of action is preempted by ERISA. Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58 (1987). Finally, even though Plaintiffs had the option of filing an ERISA action in state court, the Defendants had an absolute right to remove such action to federal court. Id. D. Deprivation of property without due process of law Plaintiffs raise an additional argument on appeal, that they were deprived of property interest without due process of law. Plaintiffs did not raise any constitutional issue before the district court. Because no showing of exceptional circumstances was made, we decline to consider this issue on appeal. See United States v. One 1971 Mercedes Benz 2-Door Coupe, 542 F.2d 912 (4th Cir. 1976); United States v. Chesapeake & Ohio Ry. Co., 215 F.2d 213 (4th Cir. 1954).