MEMORANDUM AND OPINION
ROSENTHAL, District Judge.
Pending before this court is a motion to dismiss for failure to state a claim or, in the alternative, for partial summary judgment, filed by defendant Hospital Housekeeping Systems of Houston, Inc. ("HHS") against plaintiff Tracy McGaskey ("McGaskey"). Based on a careful review of the pleadings, motions, the parties' submissions, and the applicable law, this court GRANTS HHS's motion to dismiss WITH prejudice McGaskey's state law claims; and GRANTS HHS's motion to dismiss WITHOUT prejudice McGaskey's ERISA claims, for the reasons stated below.
On July 29, 1993, while working for HHS at St. John's Hospital in Nassau Bay, Texas, McGaskey slipped on some water and cleaning solution left on the floor of the hospital. She injured her right knee and her left wrist. That same day, McGaskey reported the accident to HHS and sought treatment at the St. John's Hospital emergency room.
On July 30, 1993, HHS referred McGaskey to Dr. Howard Siegler for treatment. Dr. Siegler, a medical services "provider" under HHS's Employee Injury Benefit Plan (the "Plan"),
On August 30, 1993, a month after the fall, Dr. Siegler released McGaskey to return to work full-time. McGaskey still wore a knee and wrist brace. (Docket Entry No. 33, unmarked exhibit, McGaskey affidavit, p. 1). McGaskey did not return to work. Instead, McGaskey consulted with another doctor, Ian Reynolds, and obtained from him a "no-work
HHS was a non-subscriber to the Texas Workers' Compensation Act. (Docket Entry No. 28, Ex. A, p. 2); see TEX.REV.CIV.STAT. ANN. art. 8308-3.23(a). HHS covered employees' occupational injuries through the Plan.
HHS was the "Named Fiduciary" in the Plan. (Docket Entry No. 28, Ex. A-1, p. 15). HHS administered the Plan and reviewed all benefit claims submitted under the Plan. (Id., Ex. A, p. 3; Ex. A-1, pp. 12-16). As administrator, HHS had the authority
(Docket Entry No. 28, Ex. A-1, p. 13).
Under the Plan, participants were required to "follow fully and completely the advice of, and/or the course of treatment prescribed by, the Provider." (Id., Ex. A-1, Plan Article 5.2, p. 9). The Plan afforded participants the opportunity to object to a provider's diagnosis or treatment, by the following procedure:
(Id., Plan Article 4.4(b)).
Under the Plan, benefits terminated immediately if the participant failed to follow the directions of the Provider fully and completely; "fail[ed] to report for work immediately upon being released by the Provider (whether for full or restricted duty)"; or failed to comply with any of the Plan requirements or provisions. (Plan Article 5.3; Docket Entry No. 28, Ex. A-1, p. 9).
A participant whose request for benefits was denied had the right to receive notice of the denial in writing within ninety days.
A participant could appeal his or her denial of benefits by either requesting a review or submitting comments, in writing, within sixty
On July 29, 1993, the date of her accident, McGaskey was eligible for HHS's Injured Worker Program benefits. (Docket Entry No. 28, Ex. A, p. 4).
HHS terminated McGaskey's benefits when she did not return to work on August 30, 1993, after Dr. Siegler released her for full duty. Her failure to return violated Article 5.3(e) of the Plan. (See id., p. 9). McGaskey did not use the Plan's appeal process to challenge her termination of benefits. (Docket Entry No. 28, p. 6). Instead, on July 25, 1995, McGaskey sued HHS in state district court, alleging that HHS failed to inform her of the existence of the Plan and its policies and procedures. (Docket Entry No. 33, unmarked exhibit, McGaskey affidavit, p. 2). McGaskey also sued the Sisters of Charity of the Incarnate Word d/b/a St. John Hospital, alleging negligence, gross negligence, wrongful termination, discharge in retaliation for the pursuit of a worker's compensation claim, in violation of the Texas Workers' Compensation Act, and wrongful denial of benefits and breach of fiduciary duty, in violation of ERISA. (Docket Entry No. 21). The defendants removed to this court on September 27, 1995. (Docket Entry No. 1).
HHS now moves the court for a summary dismissal, under FED.R.CIV.P. 12(b)(6) or FED.R.CIV.P. 56, as to McGaskey's claims for: (i) wrongful termination, retaliatory discharge, and discrimination under the Texas Workers' Compensation Act; (ii) extracontractual and punitive damages; (iii) breach of the Plan's fiduciary obligation under ERISA; (iv) monetary penalties under ERISA; and (v) additional medical and disability benefits under HHS's Plan. (Docket Entry Nos. 28, 35).
II. The Applicable Legal Standards
A. The Legal Standard for a Motion to Dismiss
Under FED.R.CIV.P. 12(b)(6), "a claim may not be dismissed unless it appears certain that the plaintiff cannot prove any set of facts in support of her claim which would entitle her to relief." Hishon v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229,
A motion to dismiss for failure to state a claim pursuant to FED.R.CIV.P. 12(b)(6) is a valid means to raise an affirmative defense if the defense or other bar to relief clearly appears on the face of the complaint. Garrett v. Commonwealth Mortgage Corp. of Am., 938 F.2d 591, 594 (5th Cir.1991); Bush v. United States, 823 F.2d 909, 910 (5th Cir.1987).
B. The Legal Standard for Summary Judgment
Summary judgment is appropriate if no genuine issue of material fact exists and the moving party is entitled to judgment as a matter of law. FED.R.CIV.P. 56. Under FED. R.CIV.P. 56(c), the moving party bears the initial burden of "informing the district court of the basis for its motion, and identifying those portions of [the record] which it believes demonstrate the absence of a genuine issue for trial." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 2553, 91 L.Ed.2d 265 (1986); Norman v. Apache Corp., 19 F.3d 1017, 1023 (5th Cir.1994). The party moving for summary judgment must demonstrate the absence of a genuine issue of material fact, but need not negate the elements of the nonmovant's case. Little v. Liquid Air Corp., 37 F.3d 1069, 1075 (5th Cir.1994) (en banc). If the moving party fails to meet its initial burden, the motion for summary judgment must be denied, regardless of the nonmovant's response. Little, 37 F.3d at 1075.
When the moving party has met its Rule 56(c) burden, the nonmovant cannot survive a motion for summary judgment by resting on the mere allegations of its pleadings. McCallum Highlands, Ltd. v. Washington Capital Dus, Inc., 66 F.3d 89, 92 (5th Cir. 1995). The nonmovant must go beyond the pleadings and designate specific facts showing that there is a genuine issue for trial. Little, 37 F.3d at 1075 (citing Celotex, 477 U.S. at 323-27, 106 S.Ct. at 2553-54).
In deciding a summary judgment motion, "[t]he evidence of the nonmovant is to be believed, and all justifiable inferences are to be drawn in his favor." Anderson v. Liberty Lobby, Inc., 477 U.S. at 255, 106 S.Ct. at 2513. "Rule 56 mandates the entry of summary judgment, after adequate time for discovery, and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Little, 37 F.3d at 1075 (citing Celotex, 477 U.S. at 321-23, 106 S.Ct. at 2552).
III. ERISA Preemption
The Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. § 1001 et seq., applies to any employee benefit plan established or maintained by an employer or an employee organization engaged in commerce or in any industry or activity affecting commerce. 29 U.S.C. § 1003(a).
ERISA "supersede[s] any and all State laws insofar as they may ... relate to any employee benefit plan...." 29 U.S.C. § 1144(a). The preemption clause is broad, "designed to establish pension plan regulation as exclusively a federal concern," and has been interpreted broadly by the courts. Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 46, 107 S.Ct. 1549, 1552, 95 L.Ed.2d 39 (1987); Ingersoll-Rand Co. v. McClendon, 498 U.S. 133, 137-39, 111 S.Ct. 478, 482, 112 L.Ed.2d 474 (1990); District of Columbia v. Greater Washington Bd. of Trade, 506 U.S. 125, 138, 113 S.Ct. 580, 588, 121 L.Ed.2d 513 (1992); Smith v. Texas Children's Hospital, 84 F.3d 152, 155 (5th Cir.1996). As the Fifth Circuit recently stated:
Rokohl v. Texaco, Inc., 77 F.3d 126, 129 (5th Cir.1996) (internal quotations omitted); citing Shaw v. Delta Air Lines, 463 U.S. 85, 95-99, 103 S.Ct. 2890, 2899-900, 77 L.Ed.2d 490 (1983); Smith, 84 F.3d at 155. "Thus, ERISA preempts a state law claim if (1) the claim addresses an area of exclusive federal concern, such as the right to receive benefits under the terms of an ERISA plan; and (2) the claim directly affects relations among the principal ERISA entities — the employer, the plan and its fiduciaries, and the participants and beneficiaries." Smith, 84 F.3d at 155; citing Hubbard v. Blue Cross & Blue Shield Association, 42 F.3d 942, 945 (5th Cir.1995).
"If a state law does not expressly concern employee benefit plans, it will still be preempted insofar as it applies to benefit plans in particular cases." Rokohl, 77 F.3d at 129; citing Sommers Drug Stores Co. Employee Profit Sharing Trust v. Corrigan Enter., Inc., 793 F.2d 1456 (5th Cir.1986), cert. denied, 479 U.S. 1034, 107 S.Ct. 884, 93 L.Ed.2d 837, and cert. denied, 479 U.S. 1089, 107 S.Ct. 1298, 94 L.Ed.2d 154 (1987). If the existence of a benefit plan is a "critical factor" in establishing a state law claim, then that state law claim is preempted. Ingersoll-Rand, 498 U.S. at 139-40, 111 S.Ct. at 483.
Courts have interpreted ERISA to preempt state law claims for breach of contract and tortious processing of employee benefit claims, "even when the state action purported to authorize a remedy unavailable under the federal provision." Pilot Life Ins. Co., 481 U.S. at 45-49, 55, 107 S.Ct. at 1552-53, 1557. In Corcoran v. United Health Care, Inc., the Fifth Circuit held that ERISA preempted a state law malpractice claim brought by the beneficiary of a ERISA medical plan against the plan's utilization reviewer. 965 F.2d 1321 (5th Cir.1992). In Ingersoll-Rand, the Supreme Court held that ERISA preempted an employee's state law wrongful discharge claim based on the employer's alleged "desire to avoid making contributions to [the employee's] pension fund," even though the employee was not seeking pension benefits. 498 U.S. at 135-36, 139-41, 111 S.Ct. at 481, 483; see also Anderson v. Electronic Data Sys. Corp., 11 F.3d 1311, 1313-14 (5th Cir.1994).
Notwithstanding its breadth, ERISA does not preempt state laws which only indirectly regulate the substantive content of employee benefit plans. For example, ERISA does not preempt state laws regulating the content of policies offered by insurance companies, Metropolitan Life Insurance Co. v. Massachusetts, 471 U.S. 724, 105 S.Ct. 2380, 85 L.Ed.2d 728 (1985), or state laws of general applicability which impact employee benefit plans only tenuously, remotely, or peripherally, Shaw, 463 U.S. at 98-100, 103 S.Ct. at 2901; see also Rokohl, 77 F.3d at 129. In Shaw, the Supreme Court
This court must decide whether, "if the [plaintiff's] claims were stripped of their link to the pension plan, they would cease to exist." Rokohl, 77 F.3d at 129. McGaskey argues that her "discrimination and wrongful discharge claim, [brought under the Texas Worker's Compensation Act], fundamentally affects her employer-employee relationship with the defendant, ... and only incidentally affects her beneficiary-administrator relationship with the plan." (Docket Entry No. 33, p. 3). McGaskey relies on Rokohl in arguing that her state law claims do not depend on HHS's ERISA plan. 77 F.3d at 130; (Id., pp. 1-3).
In Rokohl, the employee brought a wrongful discharge action under the Texas Commission on Human Rights Act alleging that he was terminated because he had epilepsy, and not because he filed a claim under his employer's ERISA plan. Id. at 127. The Fifth Circuit found that his cause of action would have existed whether or not his employer maintained an ERISA plan. Id. In contrast, McGaskey does not allege that she was discharged because of her injury. Instead, she alleges that HHS wrongfully terminated her because she refused to follow Plan requirements and procedures.
The court GRANTS HHS's motion to dismiss McGaskey's state law claims for wrongful termination, retaliatory discharge, and discrimination under the Texas Workers' Compensation Act, and extracontractual and punitive damages.
IV. Exhaustion of Administrative Remedies
The courts have imposed an exhaustion requirement on plaintiffs bringing ERISA suits. Denton v. First National Bank, 765 F.2d 1295, 1303 (5th Cir.1985). Courts have imposed this requirement to: "(1) uphold Congress's desire that ERISA trustees be responsible for their actions, not the federal courts; (2) provide a sufficiently clear record of administrative action if litigation should ensue; and (3) assure that any judicial review of fiduciary action (or inaction) is made under the arbitrary and capricious standard, not de novo." Denton, 765 F.2d at 1300; citing Amato v. Bernard, 618 F.2d 559, 567 (9th Cir.1980); Meza v. General Battery Corp., 908 F.2d 1262, 1279 (5th Cir.1990); cf. Chailland v. Brown & Root, Inc., 45 F.3d 947, 950 (5th Cir.1995).
Courts have applied the exhaustion requirement to suits to recover plan benefits, Denton, 765 F.2d at 1300, as well as to suits for an administrator's breach of fiduciary duties under ERISA, Simmons v. Willcox, 911 F.2d 1077, 1081 (5th Cir.1990); citing Drinkwater v. Metro Life Ins. Co., 846 F.2d 821, 825 (1st Cir.), cert. denied, 488 U.S. 909, 109 S.Ct. 261, 102 L.Ed.2d 249 (1988). In Simmons, the court rejected the argument that, in a case alleging fiduciary breach, exhaustion
It is undisputed that McGaskey did not exhaust her administrative remedies before bringing her ERISA claims to court. McGaskey argues that she "was never given a copy of the Plan until her counsel received a copy of same [during] discovery." (Docket Entry No. 33, p. 6). Because she did not have notice of the applicable administrative review procedures, McGaskey argues that she should not be bound by them. HHS does not controvert McGaskey's claim that she never received a copy of the Plan.
ERISA contains explicit disclosure requirements to allow employees to:
H.Rep. No. 533, 93rd Cong., 2d Sess. 11, reprinted in 1974 U.S.Code Cong. & Admin.News 4639, 4649; see Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 117-19, 109 S.Ct. 948, 958, 103 L.Ed.2d 80 (1989). An administrator who fails to comply with the disclosure requirements or an employee's request for information about an ERISA plan may be held personally liable under ERISA. 29 U.S.C. § 1132(b)-(c). Nevertheless, courts have found that "[i]t does not follow [from the disclosure provisions] that Congress intended to excuse individual claimants from exhausting their administrative remedies in those cases where they were never informed of the applicable administrative procedures." Meza, 908 F.2d at 1279. Unless she can establish that the employer's failure to provide her with information about the plan "prejudiced [her] in [her] efforts to obtain benefits to which [she] is otherwise entitled," an employee must seek a remedy through an ERISA plan's administrative procedures before bringing suit in court for benefits denied or for breach of fiduciary duties. Id. at 1279-80.
There is no evidence in the record that McGaskey was substantially harmed by her failure to receive information about the HHS Plan and its review procedures. McGaskey is not excused from the requirement that she exhaust her administrative remedies and pursue review under the Plan before bringing her ERISA claims to this court. See id. at 1280.
The court dismisses McGaskey's ERISA claims against HHS, without prejudice.
This court GRANTS HHS's motion for dismissal with prejudice of plaintiff McGaskey's state law claims; and GRANTS HHS's motion for dismissal without prejudice of McGaskey's ERISA claims.
(Docket Entry No. 28, Ex. A-1, p. 6).
(Docket Entry No. 28, Ex. A-1, p. 4).
29 U.S.C. § 1002(1).
(Docket Entry No. 33, pp. 2-3).