Unpublished Disposition, 888 F.2d 130 (9th Cir. 1989)

No. 88-6164.

United States Court of Appeals, Ninth Circuit.

Before NELSON, BOOCHEVER, Circuit Judges, and WILLIAM R. BROWNING, District Judge^* .

MEMORANDUM^** 

OVERVIEW

Pacific Mutual Life Insurance Company (Pacific) and PM Management Services Company (PM) appeal a district court order remanding a removed case to state court.¹  We order the appeal dismissed for lack of jurisdiction pursuant to 28 U.S.C. § 1447(d) (1982).

* Al and Kathleen Heller sued Pacific in California state court for failure to pay medical expenses incurred for the delivery of their son. The Hellers' complaint alleged state law claims for breach of insurance contract, bad faith, breach of statutory duties under California Insurance Code Sec. 790.03, and breach of fiduciary duties.

Al Heller was covered under an insurance policy issued to the Industries Multi-Protection and Care Trust (Trust). This Trust was established by Pacific in order to market group insurance to various employers. Heller's employer, Center Third, Inc., applied for insurance coverage to a multi-employer trust plan for its employees and their dependents in August of 1985, and was accepted as a subscribing employer in April of 1986. Pacific Mutual removed the case to federal court on the ground that Heller's cause of action arose under federal law because it was preempted by the Employment Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001-1461 (1982 & Supp. V 1987). Heller claimed that Center Third did not establish and maintain its own ERISA plan, rather the Trust established this plan. Consequently, according to Heller, his claims are not preempted because his employer did not establish the plan.

The district court remanded the case to state court, stating that the defendants bore the burden of establishing that removal was proper. The district court held that Pacific failed to meet its burden of proving that Heller's employer, Center Third, established an ERISA plan. "If no ERISA covered plan exists, then the state law claims are not preempted by ERISA, and no federal question jurisdiction exists. That is the case here."

DISCUSSION

For the reasons discussed in the companion case of Hansen v. Blue Cross, No. 88-5910, slip op. (9th Cir. Oct. 2, 1989) we dismiss this case pursuant to 28 U.S.C. § 1447(d) for lack of jurisdiction. The district court remanded this case because the defendants failed to meet their burden of showing that removal was proper. Pacific argues that this decision is reviewable under this court's decision in Pelleport Investors, Inc. v. Budco Quality Theatres, Inc., 741 F.2d 273 (9th Cir. 1984), because the district court "reached a substantive decision on the merits apart from any jurisdictional decision." Id. at 276.

We disagree. The only basis for removal jurisdiction was Pacific's contention that ERISA preempted the Hellers' complaint because Al Heller was covered under an ERISA plan. See Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63-64 (1987); Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41, 52, 66 (1987). Consequently, the defendants bore the burden of showing that an ERISA plan was involved. The district court's decision was not apart from the question of subject matter jurisdiction, rather the decision was necessary to decide whether such jurisdiction existed.

The only difference between Hansen and this case is that the Hellers included a claim for breach of fiduciary duty, which would be within the exclusive jurisdiction of the federal courts if Heller's plan is subject to ERISA. Because the district court's decision that Pacific failed to meet its burden of proving that the employer established an ERISA plan is not reviewable, it follows that the the breach of fiduciary duty claim is similarly subject to the provisions of 28 U.S.C. § 1447(d).

This appeal is DISMISSED for lack of jurisdiction.