In Gardner v. Heartland Industrial Partners, LP, the Sixth Circuit reversed a decision that held that the plaintiffs’ state law tort claims for tortious interference with contract were completely preempted by ERISA. The Sixth Circuit framed the question as one of jurisdiction – in other words, whether plaintiffs’ complaint stated a federal question allowing defendants to remove to federal court and triggering preemption.
The Sixth Circuit considered whether the tortious interference claim, concerning alleged interference with plaintiffs’ SERP, satisfied two conditions for preemption: (1) the plaintiff complains about the denial of benefits to which he is entitled only because of the terms of an ERISA regulated benefit plan; and (2) the plaintiff does not allege the violation of any legal duty independent of the ERISA plan. Here, the Sixth Circuit found that the defendant’s duty not to interfere with the SERP agreement arose under Michigan law, rather than the terms of the SERP itself. Nor was defendant’s duty derived from or conditioned upon the terms of the SERP. In other words, “nobody needs to interpret the plan to determine whether that duty exists.” Although the terms of the SERP could become relevant in measuring the amount of damages, the Sixth Circuit found that insufficient to trigger preemption. As a result, the district court lacked jurisdiction and the Sixth Circuit remanded with instructions to remand the case to state court.
ERISA is often a quagmire for unsuspecting litigants, particularly with preemption and jurisdictional issues. This case sets forth the governing standard for ERISA preemption and provides a useful road map for parties seeking to avail themselves of the preemption protections of ERISA.