Court Opinion

ID: 8999312
Source: CourtListenerOpinion
Date Created: 2022-11-27 12:55:19.776209+00
Date Added: 2024-06-11T17:11:08.196053
License: Public Domain

REINHARDT, Circuit Judge,
concurring in the judgment:
I agree that ERISA preempts appellant’s state law fraud claim, and that no federal or other remedy now exists for the wrongful conduct he alleges. Even if the defendants defrauded Olson and induced him to accept employment by falsely representing that he would receive pension benefits equal to those he previously enjoyed, Olson may not assert the state cause of action he would have been entitled to plead prior to the enactment of ERISA. Because of the passage of ERISA, Olson is left without a remedy. Unfortunately, his fate is not unique.1
Congress enacted ERISA in 1974 in order to protect the rights of participants in private pension plans to a stable, secure source of retirement income. See 18 U.S.C. § 1001(a) (1988); H.R.Rep. No. 533, 93d Cong., 2d Sess. (1974) reprinted in 1974 U.S.C.C.A.N. 4639, 4642-43. As the court’s decision in this case illustrates, however, a statute designed to safeguard employee retirement benefits has, all too frequently, been used to deprive employees *1424of rights they previously enjoyed under state law while failing to provide any comparable federal remedy.
The federal courts have routinely found state tort and implied contract remedies preempted by section 514(a) even when ERISA provides no substitute for the state cause of action. See, e.g., Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 107 S.Ct. 1549, 95 L.Ed.2d 39 (1987) (injured employee whose long term disability benefits were terminated and reinstated several times over a five year period could not bring tort action against insurer); Howard v. Parisian, Inc., 807 F.2d 1560 (11th Cir.1987) (employee whose employment was terminated several days after he was severely injured in an automobile accident could not sue employer for bad faith refusal to pay benefits and intentional infliction of emotional distress); see also Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987); Maciosek v. Blue Cross & Blue Shield, 930 F.2d 536 (7th Cir.1991); Gibson v. Prudential Ins. Co. of America, 915 F.2d 414 (9th Cir.1990); Cefalu v. B.F. Goodrich Co., 871 F.2d 1290 (5th Cir.1989); Pane v. RCA Corp., 868 F.2d 631 (3d Cir.1989); Nevill v. Shell Oil Co., 835 F.2d 209 (9th Cir.1987); Anderson v. John Morrell & Co., 830 F.2d 872 (8th Cir.1987); Powell v. Chesapeake & Potomac Tel. Co., 780 F.2d 419 (4th Cir.1985), cert. denied, 476 U.S. 1170, 106 S.Ct. 2892, 90 L.Ed.2d 980 (1986). At the same time, the federal courts have consistently ruled that ERISA plaintiffs may not recover extracontractual damages. See, e.g., Drinkwater v. Metropolitan Life Ins. Co., 846 F.2d 821 (1st Cir.) (employee who suffered second heart attack after he returned to work following termination of his disability benefits could not recover punitive damages even though the doctors who recommended termination failed to examine his medical records), cert. denied, 488 U.S. 909, 109 S.Ct. 261, 102 L.Ed.2d 249 (1988); Sokol v. Bernstein, 803 F.2d 532 (9th Cir.1986) (beneficiary of pension plan could not recover damages for emotional distress from fiduciary who refused to honor express written agreement regarding disbursement of funds unless beneficiary waived all claims for breach of fiduciary duty); see also Massachusetts Mutual Life Ins. Co. v. Russell, 473 U.S. 134, 105 S.Ct. 3085, 87 L.Ed.2d 96 (1985); Pane v. RCA Corp., 868 F.2d 631 (3d Cir.1989); United Steelworkers v. Connors Steel Co., 855 F.2d 1499 (11th Cir.1988), cert. denied sub nom. H.K. Porter Co. v. United Steelworkers, 489 U.S. 1096, 109 S.Ct. 1568, 103 L.Ed.2d 935 (1989); Varhola v. Doe, 820 F.2d 809 (6th Cir.1987); Kleinhans v. Lisle Sav. Profit Sharing Trust, 810 F.2d 618 (7th Cir.1987); Sommers Drug Stores Co. v. Corrigan Enterprises, 793 F.2d 1456 (5th Cir.1986), cert. denied, 479 U.S. 1034, 107 S.Ct. 884, 93 L.Ed.2d 837 (1987); Powell v. Chesapeake & Potomac Tel. Co., 780 F.2d 419 (4th Cir.1985), cert. denied, 476 U.S. 1170, 106 S.Ct. 2892, 90 L.Ed.2d 980 (1986).
The federal courts have held that ERISA preempts various provisions of state anti-discrimination statutes, and have barred lawsuits under other provisions if the underlying complaint relates to denial of benefits. See, e.g., Ingersoll-Rand Co. v. McClendon, — U.S. -, 111 S.Ct. 478, 112 L.Ed.2d 474 (1990) (employee who was fired after 9 years and 8 months of service, 4 months before his pension would have vested, could not bring action for wrongful discharge); Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 103 S.Ct. 2890, 77 L.Ed.2d 490 (1983) (holding that ERISA preempts certain provisions of the New York Human Rights Law and Disability Benefits Law); Felton v. Unisource Corp., 940 F.2d 503 (9th Cir.1991) (employee who was fired five months after he returned to work following a medical leave of absence for lung cancer treatment could not sue employer for age and handicap discrimination under state civil rights statute); Champion Int’l Corp. v. Brown, 731 F.2d 1406 (9th Cir.1984) (holding that ERISA preempts certain pro*1425visions of Montana’s age discrimination law); see also Fitzgerald v. Codex Corp., 882 F.2d 586 (1st Cir.1989). We have also interpreted section 514(a) to preempt the use of mechanics liens, Sturgis v. Herman Miller, Inc., 943 F.2d 1127 (9th Cir.1991), and to bar the use of state law principles of contract interpretation. Evans v. Safeco Life Ins. Co., 916 F.2d 1437 (9th Cir.1990); Kanne v. Connecticut General Life Ins. Co., 867 F.2d 489 (9th Cir.1988), cert. denied, 492 U.S. 906, 109 S.Ct. 3216, 106 L.Ed.2d 566 (1989); Sampson v. Mutual Benefit Life Ins. Co., 863 F.2d 108 (1st Cir.1988).
The proliferation of ERISA preemption cases, in my view, raises a question as to whether ERISA is having an effect that is substantially contrary to that intended by those who favored its adoption. This is a matter which Congress may wish to examine carefully.

. I should note that in this case Olson's loss of his right to assert a fraud claim is of no practical consequence, since, in my opinion, the district court would have been required to grant defendants’ summary judgment motion even if a cause of action for fraud could be asserted after ERISA. Olson cannot show that he was damaged as a result of the alleged misrepresentation *1424since he had no option to stay with General Dynamics in any event. In addition, the record clearly demonstrates that no genuine issue of material fact exists as to whether he was actually misled by General Dynamics. Celotex Corp. v. Catrett, 477 U.S. 317, 322-23, 106 S.Ct. 2548, 2552, 91 L.Ed.2d 265 (1986). Therefore, Olson’s fraud claim is legally insufficient and summary judgment for defendants was appropriate.