Opinion
Civil Action No. 99-3274 c/w 99-3576
May 25, 2000
ORDER AND REASONS
Before the Court in these consolidated actions are several motions, which will be set out infra, following the facts.
FACTS
Marvin Walker ["Walker"] was employed by Valley Innovative Services, Inc. ["Valley"), and enrolled in a group insurance policy issued by Life Insurance Company of North America ["LINA"] as part of Valley's Employee Benefit Plan ["the Plan"]. When he enrolled, Walker was married to Romonda Parker Walker ["Mrs. Walker"], but was living with Bridgette Thomas ["Ms. Thomas"]. On the enrollment form, Walker named Ms. Thomas as his beneficiary and wife. Walker was murdered, an event causing the proceeds of the policy to become payable. Mrs. Walker asserted a claim to the proceeds. LINA responded that it was bound by the policy to pay the proceeds to Ms. Thomas. These actions followed.
Mrs. Walker filed a state-court concursus (interpleader) action against LINA (incorrectly named as "CIGNA Insurance Group"). Mrs. Walker sought the depositing of the insurance proceeds into the state court and a ruling under state law that she should receive the proceeds. LENA removed the action here, asserting jurisdiction under the Employee Retirement Income Security Act ["ERISA"], 29 U.S.C. § 1001, et seq. Mrs. Walker's action is Civil Action number 99-3274.
LINA, Valley and the Plan then filed an interpleader and declaratory judgment action in this Court, Civil Action number 99-3576. They sought to deposit the insurance proceeds into the Court and named Mrs. Walker and Ms. Thomas as defendants and claimants to that fund; and also sought a declaratory judgment that LINA, Valley and the Plan had no other liability than to deposit those funds. Mrs. Walker and Ms. Thomas filed answers to the interpleader and declaratory judgment petition. Mrs. Walkers' answer included a counter-claim against the plaintiffs.
The Court consolidated the two actions. The policy proceeds were deposited into the Court.
Previously, the Court found that the insurance at issue is governed by ERISA, so Mrs. Walker's state-law allegations were preempted by ERISA. The Court dismissed those allegations and allowed Mrs. Walker to amend her pleadings to assert claims under ERISA. Mrs. Walker filed an amended petition. The instant motions followed.
MOTIONS
LINA, Valley and the Plan move for dismissal of all claims against them. Neither Mrs. Walker nor Ms. Thomas opposes that motion. Ms. Thomas moves for dismissal of Mrs. Walker's claims and for disbursement of the funds to Ms. Thomas. Mrs. Walker opposes those motions. Mrs. Walker also seeks a continuance of the hearing on Ms. Thomas' motions.
DISCUSSION
LINA, Valley and the Plan's Motion for Judgment on the Pleadings
LINA, Valley and the Plan seek a judgment on the pleadings and dismissal of all claims against them. Mrs. Walker responded with a motion dismiss her claims against LINA only, and her amended petition asserts no claims against any of those parties. Ms. Thomas never asserted such claims. Movants may have no liability in this matter other than the payment of the insurance proceeds, which are deposited in the Court. The motion for dismissal of all claims against those parties is GRANTED.
Mrs. Walker's motion to continue
Mrs. Walker seeks a continuance so the Court may schedule and hear Ms. Thomas' testimony before ruling on Ms. Thomas' motions. Mrs. Walker asserts that discovery indicates that Ms. Thomas lives an immoral life and has been unemployed and living on the proceeds of fraud involving credit cards, income tax and welfare.
Mrs. Walker also asserts that she and Walker had reconciled and he was about to return to her, so Ms. Thomas may have been involved in Walker's murder. That is an unsupported allegation about which the Court will make no further comment, for the benefit of Mrs. Walker.
The only issue in Ms. Thomas' motions is the sufficiency of Mrs. Walker's pleadings. Ms. Thomas' character is irrelevant to that issue and her testimony would not aid the Court. The motion for a continuance is DENIED.
Ms. Thomas' motion to dismiss
Ms. Thomas posits that Mrs. Walker's complaint fails to state an ERISA cause of action, i.e., fails to state a claim on which relief can granted. Fed.R.Civ.P. rule 12(b)(6).
A motion to dismiss under rule 12(b)(6) is viewed, with disfavor and is rarely granted. A complaint must be liberally construed in favor of the plaintiff, and all facts pleaded in the complaint must be taken as true. The district court may not dismiss a complaint under rule 12(b)(6) unless it appears beyond doubt that the plaintiff can prove no set of facts in support of his claims which would entitle him to relief. This strict standard of review under rule 12(b)(6) has been summarized as follows: The question therefore is whether in the light most favorable to the plaintiff and with every doubt resolved in his behalf, the complaint states any valid claim for relief.Shipp v. McMahon, 199 F.3d 256, 260 (CA5 2000), collecting cases. (Internal citations and quotation marks omitted.)
Mrs. Walker's petition alleges that the insurance offered through the Plan was intended to benefit its employees' families; that Ms. Thomas could be his beneficiary only if she were misrepresented as Walker's wife, which misrepresentation Walker made on the enrollment form; that the misrepresentation was "unlawful, clearly in contravention to Louisiana's general criminal laws;" and, as to ERISA, that despite its broad preemption provisions ERISA does not preempt "any generally applicable criminal law of a state." 29 U.S.C. § 1144(b)(4). As a part of her pleading, Mrs. Walker has attached a copy of a brochure given to Valley employees regarding the insurance, which extolls the insurance as protection for an employee's family.
Mrs. Walker's only contention related to ERISA is that Walker and Ms. Thomas committed a crime of fraud when Ms. Thomas was named the beneficiary of the policy, and that state criminal laws are not preempted by ERISA, pursuant to § 1144(b)(4).
Federal courts examining that section have found that "Congress intended the words `generally applicable' to refer to such laws that apply to general conduct like larceny and embezzlement." Aloha Airlines, Inc. v. Ahue, 12 F.3d 1498, 1506 (CA9 1993), citing Sforza v. Kenco Constructioinal Contracting, Inc., 674 F. Supp. 1493, 1495 (D.Conn. 1986) and National Carriers Conference Comm. v. Heffernan, 454 F. Supp. 914, 915-16 (D.Conn. 1978). Section 1144(b)(4) exempts state criminal laws from ERISA preemption so the states are not prohibited from prosecuting crimes such as embezzlement committed in relation to an ERISA plan. See Sforza, 674 F. Supp., at 1495.
As to the insurance policy, the Court will assume that Valley intended the insurance to aid its employees in protecting their families. But, neither that beneficent intent nor the submitted brochure supports the allegation that it was a crime for Walker to name a non-family member as his beneficiary.
The Court will further assume that Ms. Thomas and Walker thought Ms. Thomas had to be misrepresented as Walker's wife in order to be his beneficiary; and they thought Walker was committing fraud when he made that misrepresentation on the enrollment form.
A deliberate misrepresentation is not necessarily unlawful fraud; and offensive intent in an act does not make the act a crime if the criminal law does not do so. Plaintiff has cited no generally applicable criminal law of Louisiana prohibiting a married employee from naming his girlfriend as the beneficiary of an insurance policy. There is no showing of a violation of a criminal law in this case. Section 1144(b)(4) is not applicable herein and does not save Mrs. Walker's state-law allegations from ERISA preemption.
Mrs. Walker has not cited, and the Court has not found, any provision of ERISA which would forbid the paying of the insurance proceeds to the named beneficiary in these circumstances. In the light most favorable to plaintiff, and with every doubt resolved in her favor, Mrs. Walker's complaint does not state a valid claim for relief under ERISA. It appears beyond doubt that Mrs. Walker can prove no set of facts in support of her claim which would entitle her to relief. Ms. Thomas' motion to dismiss Mrs. Walker's complaint is GRANTED.
Ms. Thomas' motion to disburse funds
Walker named "Bridgette Thomas" the beneficiary of the insurance policy. It is not disputed that the claimant before the Court is the person so named. Mrs. Walker's attacks on that designation are meritless. Accordingly, Ms. Thomas is entitled to the insurance proceeds. However, Ms. Thomas' motion is not accompanied by an order, and is not in the form required by Local Rule 67.3. Accordingly, the motion to disburse the funds on deposit is DENIED at this time.
CONCLUSION
In consideration of the foregoing discussion,
IT IS ORDERED that all claims of Romonda Parker Walker, the plaintiff in civil action number 99-3274 and a defendant and claimant in civil action number 99-3576, to the fund on deposit in the registry of the Court be and are hereby DISMISSED with prejudice.
IT IS FURTHER ORDERED that Bridgette Thomas, a defendant and claimant in civil action number 99-3576, may file a motion and order for disbursement to her of the insurance proceeds on deposit in the Court, pursuant to Local Rule 67.3.
IT IS FURTHER ORDERED that all claims of Romonda Parker Walker and/or Bridgette Thomas against the Life Insurance Company of North America, Valley Innovative Services, Inc. and Valley Innovative Services, Inc.'s Employee Benefit Plan be and are hereby DISMISSED with prejudice.
IT IS FURTHER ORDERED that the Clerk of Court is to prepare a judgment in both consolidated actions ordering that defendant/claimant Bridgette Thomas is entitled to the proceeds on deposit in the Court, dismissing all claims of plaintiff Romonda Parker Walker, and dismissing any and all claims against the Life Insurance Company of North America, Valley Innovative Services, Inc. and Valley Innovative Services, Inc.'s Employee Benefit Plan.