“The plaintiff’s unduly narrow approach to ERISA preemption would disrupt the national uniformity Congress enacted ERISA to provide and increase costs for plans and participants well beyond this case.”
—Cory Andrews, WLF General Counsel & Vice President of Litigation

Click here for WLF’s brief.

WASHINGTON, DC—Washington Legal Foundation (WLF) today urged the California Court of Appeal to affirm a trial-court’s holding that a plan administrator’s state-law subrogation suit is preempted under the Employee Retirement Income Security Act (ERISA).  

The appeal arises from an action by LHC Group, the administrator of a self-insured employee welfare benefit plan. LHC sued—both directly and as subrogee—on behalf of hundreds of individual plan members who allege they suffered injuries after using Bayer’s Essure® birth control device. Concluding that LHC’s claims “relate to” an employee benefit plan and are thus preempted, the trial court sustained Bayer’s demurrer without leave to amend.

In its amicus brief urging affirmance, WLF emphasized that reversing the trial court’s preemption ruling would upend settled preemption principles and undermine Congress’s strong interest in uniformity for employee-benefit plans. As WLF explained, a hodgepodge of state-law liability and regulation would ultimately be borne by the beneficiaries in the form of higher premiums or reduced benefits. WLF’s brief also argues that an ERISA plan—even one with a subrogation clause—cannot function as a de facto class action. Here, LHC’s attempt to combine the personal-injury claims of 231 plan participants into a single action is a classic case of misjoinder, which gives the appeals court an independent basis for affirmance.  

WLF’s brief was filed with the pro bono assistance of Andrew D. Silverman of Orrick Herrington & Sutcliffe LLP.