Opinion
CA 00-0824-C
November 20, 2000.
MEMORANDUM OPINION AND ORDER
This cause is before the Court on the plaintiffs motion to remand, as supplemented ( see Docs. 7, 20 21), and the defendants' brief in opposition to the motion to remand (Does. 18). The parties have consented to the exercise of jurisdiction by the Magistrate Judge, pursuant to 28 U.S.C. § 636 (c), for all further proceedings, including disposition of this motion. ( See Doc. 27 ("In accordance with the provisions of 28 U.S.C. § 636 (c) and Fed.R.Civ.P. 73, the parties in this case consent to have a United States Magistrate Judge conduct any and all proceedings in this case, including the trial, and order the entry of a final judgment, and conduct all post-judgment proceedings.")) Upon consideration of the contents of the briefs, all pertinent material submitted in support of those briefs, and the arguments of counsel on November 6, 2000, the Court GRANTS the motion to remand and remands this case to the Circuit Court of Mobile County, Alabama from whence it came.
This disposition of the motion to remand obviously MOOTS the defendants' motions to strike state law claims and the jury demand (Docs. 9 11).
FINDINGS OF FACT
1. On or about August 4, 2000, Catherine and Scott Stark filed a four-count complaint in the Circuit Court of Mobile County, Alabama, against Health Partners Southeast, Inc. d/b/a Health Partners of Alabama, Inc. (hereinafter, Health Partners), Robert W. Russ, Jr., Robert W. Russ, III, International Assurance, Inc., Mike Bugg, and numerous fictitious parties, alleging various causes of action arising out of the solicitation, negotiation and purchase of a Health Partners group health insurance plan. ( See Doc. 1, Exhibit A COMPLAINT)
10. Plaintiff Scott Stark is an independent bakery product distributor. On or around November 1997, Scott Stark attended an arranged meeting, along with several other independent distributors, for the purpose of solicitation of HPA health insurance by Defendants Robert W. Russ, Jr. and Robert W. Russ, III d.b.a. International Assurance, Inc.
11. Defendants Robert W. Russ, Jr. and Robert W. Russ, III, d.b.a. International Assurance, Inc., encouraged and directed the independent distributors to create a group amongst themselves in order to obtain group health insurance coverage. The independent distributors were then referred to as "ICOM".
12. Defendant Robert W. Russ, Jr. is an agent and/or broker of HPA. Defendant Robert W. Russ III represented himself as an agent of HPA and actively participated, created, solicited and procured enrollment of the Plaintiff participants of the HPA health insurance plans while doing business as International Assurance, Inc.
16. On or about December 1997, Plaintiffs Catherine Stark, Scott Stark and other ICOM enrollees became subscribers of health care benefits (policy #320449379) furnished by the Defendants. Plaintiffs purchased the policy in good faith.
17. Defendants HPA, Robert W. Russ Jr., Robert W. Russ III, International Assurance, Inc., Mike Bragg and Defendant(s) A through Z, provided the health insurance, or otherwise undertook significant roles and assumed duties to include fiduciary duties to the Plaintiffs in connection with the health insurance which was provided to them.
18. Plaintiffs at all times paid monthly premiums by cash and check primarily to Defendant Mike Bugg. At no time was Defendant Mike Bugg designated or appointed as proper third party administrator of the ICOM plan.
19. On or about November 23, 1999, Defendant Mike Bugg verbally informed Plaintiffs that HPA health insurance coverage would terminate on December 31, 1999.
20. Defendants HPA, Robert W. Russ Jr., Robert W. Russ III, International Assurance, Inc., Mike Bugg and Defendants A through Z represented that the reason health insurance coverage was to be terminated on December 31, 1999 and that ICOM was no longer considered a group eligible for HPA group health insurance.
21. The Plaintiffs relied to their detriment on the Defendants Robert W. Russ Jr, Robert W. Russ III and Mike Bugg's misrepresentations that Plaintif4s'] health insurance coverage would terminate on December 31, 1999 when in fact the actual date of termination was November 30, 1999.
( Id., COMPLAINT, ¶¶ 10-12 16-21 (emphasis in original)) More specifically, plaintiffs assert claims of fraud, fraud in the inducement, misrepresentation and suppression ( id., ¶¶ 28-38), bad faith ( id., ¶¶ 39-49), outrage ( id., ¶¶ 50-55), and negligent and/or wanton supervision and training ( id., ¶¶ 56-59).
2. The foregoing state action was removed on September 13, 2000 by defendants Health Partners Southeast, Inc., Health Partners of Alabama, Inc. and Robert W. Russ, Jr., on the basis that this Court has original jurisdiction pursuant to 28 U.S.C. § 1367 and 1331 and 29 U.S.C. § 1132 because plaintiffs state law claims are completely preempted by ERISA. (Doc. 1, NOTICE OF REMOVAL) Counsel for defendant International Assurance, Inc., filed that defendant's consent to removal on September 18, 2000. (Doc. 3) Counsel for defendant Mike Bugg informed the undersigned during the oral arguments on the plaintiffs' motion to remand that Bugg filed no consent to removal because it was counsel's opinion that the group insurance policy coverage at issue was not an ERISA plan.
3. The plaintiffs filed their motion to remand on September 23, 2000. (Doc. 7) Attached to the motion to remand is the September 19, 2000 affidavit of Scott B. Stark, which reads in relevant part as follows:
I have been an independent bread product distributor for approximately five years. The name of my private distributorship is Yankee Blue Distributors. I service a bread route for Bunny Bread, which is a subsidiary of Flowers Bakery. I advance the costs of my company and am reimbursed for products and receive a weekly percentage of sales check that is issued by Bunny Bread, New Orleans, Louisiana. I am not an employee of Bunny Bread or Flowers Bakery.
On or about November 12, 1997, I signed up for health insurance with Health Partners of Alabama. Several other independent drivers also signed up for the insurance under the name ICOM. I do not know what ICOM is and I do not know what it may symbolize. A company named ICOM has never employed me.
(Doc. 7, Affidavit of Scott E. Stark; see also Doc. 21, Exhibit 1 (same))
4. On November 11, 1997, Scott Stark signed a Health Partners enrollment form on the employee signature line which lists the employer name as being Yankee Blue/Bunny Bread/ICOM. (Doc. 18, Exhibit A3) The employer signature line on this form was signed by Robert L. Stephens on November 12, 1997. ( Id.)
It appears to the undersigned that someone other than the person who filled out the majority of this enrollment form inserted the anacronym ICOM on the corporation name line. ( See id.)
5. On November 12, 1997, Robert L. Stephens, as manager of a group designated as ICOM/BUNNY BREAD, and Robert W. Russ, Jr., as senior account executive and representative of Health Partners, executed a Health Partners of Alabama, Inc. Group Application. ( Id., Exhibit A1) This application reflects the term of the contract as being December 1, 1997 through November 30, 1998, the group number as 600985, the number of employees and eligibles as 7 each, employer contribution of 100%, and the address of the marketing contact, Robert Stephens, as 4370 Rangeline Park Boulevard, Mobile, Alabama 36691. ( Id.)
6. The Group Enrollment Agreement issued by Health Partners to ICOM dba BUNNY BREAD for the period December 1, 1997 to November 30, 1998 was executed, on November 24, 1997, by the Gulf Coast Regional Marketing Manager for Health Partners of Alabama, Inc., and on December 10, 1997 by Robert L. Stephens, as distributor, for the group ICOM dba Bunny Bread. ( Id., Exhibit A2) "This GROUP ENROLLMENT AGREEMENT . . . is entered into by and between Health Partners of Alabama, Inc. . . ., an Alabama corporation authorized to operate as a Health Maintenance Organization under Section 27-21A (Code of Alabama) and ICOM dba BUNNY BREAD. . . ." ( Id. (emphasis in original))
7. The Group Enrollment Agreement issued by Health Partners to ICOM dba BUNNY BREAD for the period December 1, 1998 to November 30, 1999 was executed, on November 30, 1998, by the Gulf Coast Regional Marketing Manager for Health Partners of Alabama, Inc., and on December 7, 1998 by Michael Bugg, as manager, for the group ICOM dba Bunny Bread. ( Id., Exhibit 4) The agreement provided that any notice sent to the group would be addressed to ICOM/dba Bunny Bread, 1709 Aspen Wood Court, Mobile, Alabama 36609. ( Id. at 14) "This GROUP ENROLLMENT AGREEMENT . . . is entered into by and between Health Partners of Alabama, Inc. . . ., a licensed Alabama health maintenance organization and ICOM\ dba Bunny Bread . . . . The Agreement shall become effective on the later of the Effective Date or the date the Agreement is signed by both Health Partners and Group." ( Id. at 1 (emphasis in original))
8. Attached to Health Partners' response to the motion to remand is the October 13, 2000 affidavit of defendant Robert W. Russ, Jr. (Doc. 18, Exhibit A) This affidavit reads, in part, as follows:
2. In November 1997, I was employed as a Senior Account Executive with Health Partners of Alabama in Mobile, Alabama. I was contacted by Mr. Robert Stephens who identified himself as the manager for ICOM d/b/a Bunny Bread. Mr. Stephens informed me that ICOM d/b/a Bunny Bread was interested in obtaining group insurance coverage for a small employee group. On November 12, 1997, Robert L. Stephens signed a group application as the manager of ICOM d/b/a Bunny Bread for health benefits for seven eligible employees of ICOM d/b/a Bunny Bread. . . .
3. Based on the representations made by Mr. Stephens that ICOM d/b/a Bunny Bread was a bonafide employer-related group, Health Partners of Alabama issued a group enrollment agreement. . . . This group enrollment agreement was effective from December 1, 1997 through November 30, 1998.
as the In applying for group coverage, Robert Stephens presented himself manager of ICOM d/b/a Bunny Bread. He provided an address of 4370 Rangeline Park Boulevard, Mobile, Alabama 36691. He also provided a telephone number of (334) 443-6666. This telephone number is still listed under Bunny Bread Company at the same address.
4. In discussing employee health benefit matters with Mr. Robert Stephens, I acted under the impression that ICOM d/b/a Bunny Bread was a bonafide employer-related group for those participants covered under the plan. . . .
5. Mr. Stephens provided Health Partners of Alabama with completed HMO Enrollment Applications from the individual participants. . . .
6. On December 1, 1998, the group enrollment agreement was renewed for another year. . . . At the time of renewal, the group application indicated eligible employees had increased to ten, and the employer continued to make 100% of the contribution.
7. In anticipation of the renewal on December 1, 1999. the employer group was provided new rate information and a request for a wage and tax statement. The employer did not produce a wage and tax statement, and the group was notified that Health Partners of Alabama would not renew the group enrollment agreement without this information. When the employer, ICOM d/b/a Bunny Bread, did not respond by providing the necessary information, i.e., the wage and tax statement, the group enrollment agreement terminated effective November 30, 1999.
See also Doc. 21, Exhibit 3, at ¶ 20 ("These defendants admit that ICOM failed to meet the underwriting criteria to be eligible for group health insurance through Health Partners of Alabama.").
( Id)
9. The plaintiffs have submitted the October 6, 2000 certificate of Jim Bennett, Secretary of State of the State of Alabama, which provides that "after a diligent search of the alphabetical corporate records on file in this office, consisting of domestic and foreign corporations, profit and non-profit, domestic and foreign limited partnerships, domestic and foreign limited liability companies and domestic and foreign limited liability partnerships no record is found to exist of any entity by the name: ICOM d.b.a. ICOM/BUNNY BREAD[.] I further certify that this is the office having legal custody of such records. (Doc. 21, Exhibit 2 (emphasis in original))
10. During oral argument, plaintiffs supplied the October 24, 2000 affidavit of Stephanie B. Tillman, Esquire, corporate counsel for Bunny Bread, Inc., which reads, in pertinent part, as follows:
Bunny Bread, Inc. which is located in New Orleans, Louisiana, sells its products in a market area which includes Mobile, Alabama. Following a review of company documents, and to the best of my knowledge, there is no evidence of the existence of an entity known and/or described as ICOM or ICOM doing business as Bunny Bread, Inc. Further, to the best of my knowledge, no subsidiary, entity, incorporated or unincorporated company by the name of ICOM is affihated with Bunny Bread, Inc. or its parent or affiliate companies.
( Id.)
CONCLUSIONS OF LAW
1. Federal district courts-have original jurisdiction over diversity cases, 28 U.S.C. § 1332, and "of all civil actions arising under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1331. "Because, in this case, there is no contention that diversity exists between the parties, federal jurisdiction must rest, if at all, on federal question jurisdiction." Whitt v. Sherman Int'l Corp., 147 F.3d 1325, 1329 (11th Cir. 1998).
2. Defendants may remove to federal district court any civil action arising under the Constitution, laws or treaties of the United States, that is, any action over which the federal district court has original jurisdiction. 28 U.S.C. § 1441 (a)-(c) ("[A]ny civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court embracing the place where such action is pending. . . . Any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties or laws of the United States shall be removable without regard to the citizenship or residence of the parties. . . . Whenever a separate and independent claim or cause of action within the jurisdiction conferred by section 1331 of this title is joined with one or more otherwise non-removable claims or causes of action, the entire case may be removed and the district court may determine all issues therein, or, in its discretion, may remand all matters in which State law predominates."). "An action arises under federal law under § 1331 if the federal law creates the cause of action or `the plaintiffs right to relief necessarily depends on the resolution of a substantial question of federal law.`" C.C. Mid West, Inc. v. McDougall, 990 F. Supp. 914, 917 (E.D.Mich. 1998), quoting Franchise Tax Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 27-28, 103 S.Ct. 2841, 2856, 77 L.Ed.2d 420 (1983).
Under the "well-pleaded complaint" rule, a case does not arise under federal law unless a federal question is presented on the face of the plaintiffs complaint. Because the well-pleaded complaint rule requires a federal question to appear on the face of the plaintiffs complaint, a defense presenting a federal question — even a valid one — cannot create removal jurisdiction.Whitt, supra, 147 F.3d at 1329 (internal citations omitted); see also Kemp v. International Business Machines Corp., 109 F.3d 708, 712 (11th Cir. 1997) ("A case does not arise under federal law unless a federal question is presented on the face of the plaintiffs complaint."). The well-pleaded complaint rule exists and is of paramount importance to this Court because it recognizes that plaintiffs are the masters of their complaint and at liberty to choose state or federal jurisdiction. Four Way Plant Farm, Inc. v. NCCI, 894 F. Supp. 1538, 1542 (M.D.Ala. 1995), citing Caterpillar, Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 2429, 96 L.Ed.2d 318 (1987); see also Caterpillar, Inc., 482 U.S. at 398-399, 107 S.Ct. at 2433 ("[T]he plaintiff is the master of the complaint . . . and . . . may, by eschewing claims based on federal law, choose to have the cause heard in state court. . . . [A] defendant cannot, merely by injecting a federal question into an action that asserts what is plainly a state-law claim, transform the action into one arising under federal law, thereby selecting the forum im which the claim shall be litigated.").
3. In this case, the Starks assert only state law claims and four of five defendants have removed the case to this Court on account of ERISA preemption, a federal law defense. "Under the general terms of the well-pleaded complaint rule, therefore, the removal of this case to [this Court is] improper because the preemption defense [is] not presented on the face of the complaint." Whitt, 147 F.3d at 1329.
The doctrine of "complete preemption" or "super preemption," however, qualifies the general well-pleaded complaint rule. Where Congress preempts an area of law so completely that any complaint raising claims in that area is necessarily federal in character, super preemption applies, and federal jurisdiction exists, even if the face of the complaint does not plead federal claims. Super preemption converts state law claims into federal claims for purposes of the well-pleaded complaint rule, allowing a defendant to remove the case to federal court. As this Court has recognized, the Supreme Court has held that Congress created super preemption in ERISA, which provides the exclusive cause of action for the recovery of benefits governed by an ERISA plan. State law claims that seek relief available under ERISA are recharacterized as ERISA claims and therefore arise under federal law.
Thus, this Court has found that the jurisdictional issue in cases such as the one at hand is dependent upon whether the plaintiff is seeking relief that is available under 29 U.S.C. § 1132 (a). If so, the Court must recharacterize the plaintiffs claim as an ERISA claim, and removal jurisdiction exists. Conversely, if the plaintiff is not seeking relief that is available under section 1132(a), no federal question jurisdiction exists.Id. at 1329-1330 (internal citations omitted); see also Kemp, supra, 109 F.3d at 712 (same).
4. The removing defendants, of course, must bear the burden of establishing a proper basis for removal jurisdiction. See, e.g., McCaslin v. Blue Cross Blue Shield of Alabama, 779 F. Supp. 1312, 1318 (N.D.Ala. 1991). In examining whether the defendants have met their burden in this regard, this Court is ever mindful of the Eleventh Circuit's "preference for remand where federal jurisdiction is not absolutely clear." Whitt, supra, 147 F.3d at 1333, citing Burns v. Windsor Ins. Co., 31 F.3d 1092, 1095 (11th Cir. 1994).
5. Section 1132(a) provides, in pertinent part, that a beneficiary or participant of a "plan" may bring suit "to recover benefits due to him under the terms of his plan. . . ." 29 U.S.C. § 1132 (a)(1)(B). The term "plan" is defined in ERISA as an "employee welfare benefit plan" or an "employee pension benefit plan." 29 U.S.C. § 1002 (3). ERISA defines an employee welfare benefit plan, which the removing defendants claim exists here (Doc. 18 ("The defendants will demonstrate in this response that the plan at issue qualifies as an employee welfare benefit plan within the provisions of ERISA.")), as
any plan, fund, or program which was heretofore or is hereafter established or maintained by an employer or by an employee organization, or by both, to the extent that such plan, fund, or program was established or is maintained for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care or benefits, or benefits in the event of sickness, accident, [or] disability. . . .29 U.S.C. § 1002 (1). The pivotal issue for this court, therefore, becomes whether the group insurance policy issued by Health Partners constitutes an ERISA employee welfare benefit plan. Slamen v. Paul Revere Life Ins. Co., 166 F.3d 1102, 1104 (11th Cir. 1999); Whitt, supra, 147 F.3d at 1330. If the Starks' health insurance policy is an ERISA plan, this Court may properly re-characterize plaintiffs' claims as ERISA claims and deny the motion to remand but if the policy is not an ERISA plan and the Starks are not entitled to seek relief under ERISA, "`no federal question jurisdiction exists' and the case must be remanded to" the Circuit Court of Mobile County, Alabama. Slamen, 166 F.3d at 1104 (citation omitted).
6. The Eleventh Circuit, for almost twenty years, has held that five requirements must be established for an employee welfare benefit plan to fall within the scope of ERISA. Compare Slamen, 166 F.3d at 1104 with Donovan v. Dillingham, 688 F.2d 1367 (11th Cir. 1982) (en bane). "`[A] welfare plan requires (1) a `plan, fund, or program (2) established or maintained (3) by an employer or by an employee organization, or by both, (4) for the purpose of providing medical, surgical, hospital care, sickness, accident, disability . . . benefits . . . (5) to participants or their beneficiaries.'" Slamen, 166 F.3d at 1104, quoting Donovan, 688 F.2d at 1371. The appellate court has adopted "a `flexible analysis' for determining whether an ERISA `plan' is established, Williams v. Wright, 927 F.2d 1540, 1543 (11th Cir. 1991), finding the existence of such plans where, "from the surrounding circumstances a reasonable person can ascertain the intended benefits, a class of beneficiaries, the source of financing, and procedures for receiving benefits.'" Whitt, supra, 147 F.3d at 1330, quoting Donovan, supra, 688 F.2d at 1373.
7. It is nonetheless clear that "not all welfare benefit plans that meet these five criteria are governed by ERISA." Slamen, supra.
The gist of ERISA's definitions of employer, employee organization, participant, and beneficiary is that a plan, fund, or program falls within the ambit of ERISA only if the plan, fund, or program covers ERISA participants because of their employee status in an employment relationship, and an employer or employee organization is the person that establishes or maintains the plan, fund, or program. Thus, plans, funds, or programs under which no . . . employees or former employees participate are not employee welfare benefit plans under Title I of ERISA.Donovan, 688 F.2d at 1371; see also Slamen, 166 F.3d at 1104; 29 C.F.R. § 2510.3-3 (b) (1999) ("[T]he term `employee benefit plan' shall not include any plan, fund, or program. under which no employees are participants covered under the plan[.]").
Similarly,
[t]he Fifth Circuit has devised a comprehensive test for determining whether a particular plan qualifies as an employee welfare benefit plan. Under this test, a court must ascertain whether a plan (1) exists; (2) falls within the safe-harbor provision-established by the Department of Labor; and (3) satisfies the primary elements of an ERISA employee benefit plan — establishment or maintenance by an employer intending to benefit employees. If any part of the inquiry is answered in the negative, the submission is not an ERISA plan. At the outset, any court confronted with the question whether a particular arrangement constitutes an employee welfare benefit plan under ERISA must first satisfy itself that there is in fact a plan at all. In determining whether a plan . . . [exists,] a court must determine whether from the surrounding circumstances a reasonable person could ascertain the intended benefits, beneficiaries, source of financing, and procedures for receiving benefits.Salameh v. Provident Life Accident Ins. Co., 23 F. Supp.2d 704, 709-710 (S.D.Tex. 1998) (internal quotation and citation marks omitted).
8. This Court finds that the removing parties have failed to establish the third of the five requirements set forth in Donovan for an employee welfare benefit plan to fall within ERISA's scope and, alternatively, even assuming that the five requirements have been met, as was found in Slamen, that the removing parties have wholly failed to address, much less carry their burden of showing, that the plan at issue here "`covers ERISA participants because of their employee status in an employment relationship, and an employer or employee organization is the person that establishes or maintains the plan, fund, or program.'" Slamen, supra, 166 F.3d at 1104, quoting Donovan, supra, 688 F.2d at 1371; see Salameh, supra, 23 F. Supp.2d at 710 ("`[A]n employee benefit plan necessarily must center on the existence of an employer and an employee.'"). While this failure on the removing defendants' part is reason enough to remand this case to the Circuit Court of Mobile County, Alabama, see Whitt, supra, 147 F.3d at 1333 (appellate court set forth its preference for remand where federal jurisdiction is not absolutely clear), this Court will set forth its reasoning for remanding this case to the Mobile County Circuit Court. Analyzing the fundamental problem with the defendants' removal of this case to federal court requires this Court to look at the definitions of employer, employee organization and, most importantly, employee.
9. ERISA defines employee as "any individual employed by an employer." 29 U.S.C. § 1002 (6). Because this definition is inherently circular, the United States Supreme Court has adopted the common law agency test for determining whether an individual is an employee. Nationwide Mut. Ins. Co. v. Darden, 503 U.S. 318, 323, 112 S.Ct. 1344, 1348, 117 L.Ed.2d 581 (1992).
In determining whether a hired party is an employee under the general common law of agency, we consider the hiring party's right to control the manner and means by which the product is accomplished. Among the other factors relevant to this inquiry are the skill[s] required; the source of the instrumentalities and tools; the location of the work; the duration of the relationship between the parties; whether the hiring party has the right to assign additional projects to the hired party; the extent of the hired party's discretion over when and how long to work; the method of payment; the hired party's role in hiring and paying assistants; whether the work is part of the regular business of the hiring party; whether the hiring party is in business; the provision of employee benefits; and the tax treatment of the hired party.Id. at 323-324, 112 S.Ct. at 1348 (internal quotation marks omitted). "Independent contractors are not employees in the absence of any indicia of an employer-employee relationship." HCA Health Services of the Midwest, Inc. v. Brown, 1988 WL 71219 *1 (N.D.Ill. 1988), citing Holt v. Winpisinger, 811 F.2d 1532 (D.C. Cir. 1987); Short v. Central States Southeast Southwest Areas Pension Fund, 729 F.2d 567 (8th Cir. 1984).
10. The term "employer" means "any person acting directly as an employer, or indirectly in the interest of an employer, in relation to an employee benefit plan; and includes a group or association of employers acting for an employer in such capacity." 29 U.S.C. § 1002 (5). The term "employee organization" means "any labor union or any organization of any kind, or any agency or employee representation committee, association, group, or plan, in which employees participate and which exists for the purpose, in whole or in part, of dealing with employers concerning an employee benefit plan, or other matters incidental to employment relationships; or any employees' beneficiary association organized for the purpose in whole or in part, of establishing such a plan." 29 U.S.C. § 1002 (4).
11. The removing defendants have offered no evidence, other than the written references contained in the insurance policy, application and enrollment forms, that Robert Stark, and his bread product distributor associates, were employees of an employer as opposed to independent contractors; that ICOM or ICOM d/b/a Bunny Bread, was the employer of Robert Stark and the other bread product distributors; or that the group formed by Stark, Stephens and the other bread product distributors was an employee organization. The only thing these defendants have offered, other than the document references to employees and employer, is the post-removal affidavit of Robert W. Russ, Jr., which sets forth his recollection of his dealings with Stephens, representations made by Stephens in negotiating the group policy, and his impression that he was dealing with a bonafide-related group in ICOM d/b/a Bunny Bread. The problem with all of this evidence is that it is directly contrary to the allegations of the complaint that Scott Stark, along with the other individuals who participated in the Health Partners group policy, were independent bakery/bread product distributors; that Russ and his son directed the group of independent bakery product distributors to create a group amongst themselves in order to obtain group health insurance coverage; that this group of independent distributors was referred to as ICOM to this end; and that Scott Stark paid monthly premiums in cash or by check primarily to defendant Mike Bugg (Doc. 1, COMPLAINT, at ¶¶ 10-11 18). The important information for purposes of removal is that information in existence at the time of removal, see Whitt, supra, 147 F.3d at 1330 ("[O]ur central inquiry is to determine whether the 1992 LTIP constituted an ERISA `plan' as of the time Whitt filed suit."), and since "`it is axiomatic that ambiguities are generally construed against removal[,]'" id. at 1329, quoting Butler v. Polk, 592 F.2d 1293, 1296 (5th Cir. 1979), it is clear to the undersigned that this case need be remanded to the Circuit Court of Mobile County, Alabama because of the removing defendants' failure to establish that an employer or employee organization established or maintained the subject group insurance plan/policy or that the participants enjoyed employee status. In this regard, it matters not what Russ' impressions were, particularly since the allegations of the complaint contradict Russ' affidavit statements, or what the documents reflect but rather, if in fact there existed an ERISA employer or employee organization and ERISA employees. That Stephens, and perhaps Bugg, Stark and the other independent distributors, might have misrepresented facts to the defendants in order to procure group health insurance coverage might well be relevant to the ultimate disposition of the plaintiffs' state law claims it is only relevant to the issue before this Court as an implicit admission that Scott Stark and the other distributors were not employees and that there was no employer or employee organization. Given the evidence in this case, this court simply cannot find that Stephens, Stark, Bugg and the other bread product distributors enjoyed employee status as opposed to independent contractor status or that there existed an employer or employee organization that established or maintained the insurance plan. Therefore, whether this Court considers that the removing defendants have failed to carry their burden for purposes of removal or whether this Court considers plaintiffs complaint as creating ambiguities with respect to the propriety of removal the result is the same and that is that this Court must adhere to the Eleventh Circuit's preference for remand, Whitt, supra, 147 F.3d at 1333, since federal jurisdiction is not absolutely clear, id., because no ERISA plan existed.
Moreover, while the removing defendants make much of the address listed for ICOM d/b/a Bunny Bread contained in the initial insurance policy they curiously make no mention of Stephens reference to himself in that document as distributor or the address contained in the renewal policy/agreement for ICOM d/b/a Bunny Bread, that is, 1709 Aspen Wood Court Mobiel, Alabama 36609. A review of the BellSouth telephone book reveals that this address is the residence of Michael Bugg.
In other words, just as the failure to label a policy an ERISA plan, as here, does not establish the inapplicability of the statute, see, e.g., Taylor v. Carter, 948 F. Supp. 1290, 1294 (W.D.Tex. 1996) ("[N]either the statute nor the accompanying regulations require a notation that the plan is covered by ERISA as a condition precedent to the applicability of the statute."), so too removing defendants cannot rely upon document references and designations respecting employer and employees to establish that an employer established and maintained the plan and that Scott Stark and the other bread product distributors covered by the plan enjoyed employee status as opposed to being independent contractors, cf. Casey v. Atlantic Richfield Co., 2000 WL 657397 * 4 (C.D.Cal. 2000) ("Under the common law analysis, how the employment relationship is described by the parties and the employment documents is considered but is not dispositive. For example, in Daughtrey v. Honeywell, Inc., 3 F.3d 1488 (11th Cir. 1993), the Court of Appeals for the Eleventh Circuit concluded that the district court had relied too heavily on the parties' contract, which described the ERISA plaintiff as an independent contractor, in determining that the plaintiff was not an employee."), particularly where, as here, counsel for Health Partners admitted during oral argument that there is a reasonable question as to the employment status of the group.
All of the post-removal evidence the plaintiffs have produced to this Court merely serves to solidify the Court's finding that the removing defendants have not, and cannot, satisfy their burden of establishing that an employer or employee organization established or maintained the group health plan and that the independent bread product distributors enjoyed employee status.
CONCLUSION
The Court concludes that the group health insurance plan at issue here is not an employee welfare benefit plan within the meaning of ERISA, that the preemption doctrine does not apply, and that federal jurisdiction cannot be found. Accordingly, the plaintiffs' motion to remand this case to the Circuit Court of Mobile County, Alabama (Doc. 7) is GRANTED.
JUDGMENT
In accordance with the memorandum opinion and order entered on this date, it is hereby ORDERED, ADJUDGED, and DECREED that the group health insurance plan at issue in this case is not an employee welfare benefit plan within the meaning of ERISA, that the preemption doctrine does not apply, that federal jurisdiction cannot be found and that this case be and it hereby is REMANDED to the Circuit Court of Mobile County, Alabama from whence it came.