Court Opinion

ID: 8994108
Source: CourtListenerOpinion
Date Created: 2022-11-27 12:26:26.923317+00
Date Added: 2024-06-11T17:10:59.702808
License: Public Domain

PREGERSON, Circuit Judge,
dissenting.
In Mackey v. Lanier Collection Agency & Service, Inc., 486 U.S. 825, 108 S.Ct. 2182, 100 L.Ed.2d 836 (1988), the Supreme Court held that a Georgia statute exempting employee benefit plans from the reach of the state’s general garnishment statute is pre-empted by ERISA. More importantly to this case, however, the Court also concluded that ERISA does not pre-empt Georgia’s general garnishment statute. The Court explained that, because ERISA provides no procedures for the collection of judgments, “Congress did not intend to forbid the use of state-law mechanisms of executing judgments.” Id. at 831, 108 S.Ct. at 2186. Because I believe the mechanic’s lien provided by Cal.Civ.Code § 3111, like the garnishment procedure in Mackey, is not pre-empted by ERISA, I respectfully dissent.
The majority finds that section 3111 is pre-empted by ERISA because it “contains a clear reference to and connection with ERISA.” Majority opinion at 1129. I do not read Mackey, however, to hold that a mere reference in a state statute to an employee benefit trust fund controls the pre-emption question. Rather, a careful reading of Mackey teaches us that the determinative pre-emption factor is whether the state-law enforcement procedure in question singles out ERISA plans for special treatment. Mackey, 486 U.S. at 830, 108 S.Ct. at 2185 (“we hold that [the Georgia statute], which singles out ERISA employee welfare benefit plans for different treatment under state garnishment procedures, is pre-empted”) (footnote omitted); id. at 838 n. 12, 108 S.Ct. at 2189 n. 12 *1131(“While we believe that state-law garnishment procedures are not pre-empted ..., we also conclude that any state law which singles out ERISA plans, by express reference, for special treatment is pre-empted. It is this ‘singling out’ that pre-empts the Georgia antigarnishment exception.”) (citation omitted). Normally, a statute that explicitly refers to ERISA plans will also “single out” such plans for special treatment, and therefore will be pre-empted by ERISA, but this result is not necessarily so.
The majority errs by not viewing section 3111 in the context of California’s general mechanic's lien laws. California creates mechanic’s liens in favor of “[mjechanics, materialmen, contractors, subcontractors, lessors of equipment, artisans, architects, registered engineers, licensed land surveyors, machinists, builders, teamsters, and draymen, and all persons and laborers of every class performing labor upon or bestowing skill or other necessary services ” Cal.Civ.Code § 3110. Section 3111 provides the same lien to employee benefit trust funds for unpaid employer contributions. California thus does not single out ERISA plans for special treatment, but gives ERISA plans the same procedure to recover unpaid employer contributions as California gives to employees who are not members of ERISA plans.
Employee benefits (which may include pension, health, welfare, and vacation benefits) are an important part of an employee’s compensation. The result of the majority’s opinion is that employees who are not members of ERISA plans may use mechanic’s liens to ensure that employers fulfill their obligations to pay benefits — but members of ERISA plans may not. This turns the logic of Mackey on its head. Mackey precludes state laws that single out ERISA plans; it does not prohibit even-handed state-law enforcement procedures.
In many instances, the mechanic's lien may be the only way for an ERISA plan to protect fully the interests of its employee beneficiaries. The majority places employee benefits unnecessarily at risk by eliminating this important state-law enforcement measure. See Mackey, 486 U.S. at 834, 108 S.Ct. at 2187 (“state-law methods for collecting money judgments must, as a general matter, remain undisturbed by ERISA; otherwise, there would be no way to enforce such a judgment”). Because I believe ERISA does not preclude an ERISA plan from using the mechanic’s lien provisions provided by California statute, I respectfully dissent.