Court Opinion

ID: 9561218
Source: CourtListenerOpinion
Date Created: 2023-08-21 18:05:30.963438+00
Date Added: 2024-06-11T09:13:41.497975
License: Public Domain

RABINO WITZ, Chief Justice,
with whom, COMPTON, Justice, joins dissenting.
I would hold that plaintiffs’ state law claims are preempted by ERISA.
ERISA states that an employee benefit plan must operate in accordance with the terms of a written instrument, including the terms which govern trustee selection:
(1) Every employee benefit plan shall be established and maintained pursuant to a written instrument. Such instrument shall provide for one or more named fiduciaries who jointly or severally shall have authority to control and manage the operation and administration of the plan.
(2) For purposes of this subchapter, the term “named fiduciary” means a fiduciary who is named in the plan instrument, or who, pursuant to a procedure specified in the plan, is identified as a fiduciary (A) by a person who is an employer or employee organization with respect to the plan or (B) by such an employer and *312such an employee organization acting jointly.
29 U.S.C. § 1102(a) (emphasis added).
ERISA further provides for the equitable relief which plaintiffs seek in their state-law claim:
A civil action may be brought—
(3) by a participant, beneficiary, or fiduciary (A) to enjoin any act or practice which violates any provision of this sub-chapter or the terms of the plan, or (B) to obtain other appropriate equitable relief (i) to redress such violations or (ii) to enforce any provisions of this sub-chapter or the terms of the plan [.]
29 U.S.C. § 1132(a) (emphasis added). A federal cause of action therefore exists for improper selection of a trustee of an employee benefit plan. In my view ERISA’s broad preemption provision, coupled with the fact that ERISA provides a remedy for the wrong alleged here, indicates that plaintiffs’ state law claims are preempted. See Dependahl v. Falstaff Brewing Corp., 653 F.2d 1208 (8th Cir.), cert. denied, 454 U.S. 968, 102 S.Ct. 512, 70 L.Ed.2d 384 (1981).1
Here, “state law” does “relate to” the employee benefit plans, given that Congress used the words “relate to” in 29 U.S.C. § 1144(a) in their “broad sense.” Shaw v. Delta Airlines, Inc., 463 U.S. 85, 97, 103 S.Ct. 2890, 2900, 77 L.Ed.2d 490, 501 (1983). In my view the selection, appointment, and removal of trustees clearly relates to the proper functioning of employee benefit plans. (Op. at 309)
Furthermore, the identity of the trustee and how the trustee is selected may have a significant impact on the functioning of the plan. ERISA provides that trustees (“named fiduciaries”) “shall have authority to control and manage the operation and the administration of the plan.” 29 U.S.C. § 1102(a)(1). While every trustee will be subject to the same fiduciary duties, different trustees may nonetheless make very different decisions about how to operate the plan within those fiduciary duties.
The majority gives weight to the fact that the state law in this case does not affect the disclosure, funding, reporting, vesting, and enforcement provisions of ERISA, and that no ERISA provision governs violations of the internal operating procedures of the organizations which select the trustees. (Op. at 310) It is recognized, however, that ERISA contains almost no federal regulation of the terms of benefit plans. Metropolitan Life Insurance Co. v. Massachusetts, 471 U.S. 724, 105 S.Ct. 2380, 85 L.Ed.2d 728, 735 (1985). Nevertheless, it is clear that state laws which impact on the substance of benefit plans, for example, by restricting the plan’s options, should be preempted. See Metropolitan Life, 471 U.S. at -, 105 S.Ct. at 2388-89, 85 L.Ed.2d at 739-40. The identity of the trustee may likewise impact on the substantive operation of the plan.
Moreover, as a co-sponsor of the legislation which became ERISA stated: “It is ... intended that a body of Federal substantive law will be developed by the courts to deal with issues involving rights and obligations under private welfare and pension plans.” 120 Cong.Rec. 29942 (1974) (statement of Sen. Javits). Federal law governs the selection of the trustees. See 29 U.S.C. § 1102. The development of principles concerning the selection of trustees should be a matter of federal, not state, law.
Having concluded that plaintiffs’ state law claims are preempted, I would further hold that federal courts have exclusive jur*313isdiction over the claims. ERISA provides that, except for suits to recover benefits due under a benefit plan, “the district courts of the United States shall have exclusive jurisdiction of civil actions under this subchapter brought by the Secretary or by a participant, beneficiary, or fiduciary.” 29 U.S.C. § 1132(e).

. It is true that plaintiffs’ claims allege violations of the constitution and bylaws of the State Council and that these provisions are not explicitly incorporated in the written instrument creating the plan. The written instrument does, however, provide for the union to select trustees. ERISA makes clear that the interpretation of the written instrument, including the provisions regarding trustee selection, is a federal question. How the State Council’s provisions are implicitly incorporated in the written instrument and what effect they will have are still part of the broader question of interpreting the written instrument. This question is a federal question.