ERISA Preempts State Law

There are very few things as embarrassing for a lawyer as being at the wrong court. This is certainly true if it is 8:50 a.m. and you are wondering why your case is not on the list at the courthouse you drove to automatically while your were half asleep. It is equally true if you file a suit in state court, including counts for 93A and other extra-contractual damages, only to have your case removed to federal court and your state charges dismissed. This, unfortunately, is the fate of nearly all attorneys who file state court actions to recover damages for ERISA disability benefit denials. ERISA is a federal statute regulating employer sponsored benefits, including pensions, health care and disability plans. With respect to the protection of employee benefit rights, the statute grants exclusive jurisdiction to the federal district courts for civil actions brought by a participant or beneficiary, but provides an exception for actions brought by a participant or beneficiary to recover benefits due to him under the terms of the plan, to enforce his rights under the plan or to clarify his right to future benefits. See 29 U.S.C. 1132(a)(1)(B) and 29 U.S.C. 1132(e). In fact, state courts have concurrent jurisdiction of claims brought under 1132(a)(1)(B), leading one to conclude that a beneficiary can bring an ERISA action in state court. However, the ERISA statute also supersedes any and all state laws insofar as they “relate to” any employee benefit plan. 29 U.S.C. 1144(a). That, in turn, makes those claims subject to 28 U.S.C. 1331, which gives the federal district courts original jurisdiction over all civil actions arising under the Constitution, laws and treaties of the United States. The net of all of this is that the ERISA statute provides for, and has been interpreted by the courts to, grant exclusive jurisdiction to the federal courts whenever participants or beneficiaries seek to enforce their rights. In other words, for all intents and purposes, the ERISA statute preempts state law in employer benefit cases in which the law applies.