Ashley Healthcare Plan v. Michael Dillard, 177 So. 3d 175

Three-year-old O.D. was seriously injured in a car wreck; her parents (the Dillards) were appointed guardians to settle her tort claims for $75,000 (all available insurance limits).
Ashley Healthcare Plan (an ERISA-covered employer plan) had paid $33,683.58 in medical benefits and asserted an ERISA-based subrogation lien against settlement proceeds.
On the chancery-court petition to approve the minor’s settlement (required by Miss. Code § 93-13-59), Ashley removed the matter to federal court, asserting ERISA preemption and invoking ERISA’s civil-enforcement provisions.
The U.S. District Court for the Northern District of Mississippi remanded, holding ERISA did not preempt the state statutory process for approving minor settlements and that the plan’s asserted federal remedy (reimbursement) was not cognizable under ERISA § 502(a).
After remand, the Pontotoc County Chancery Court awarded the Dillards $18,180 in fees under Mississippi’s Litigation Accountability Act, finding the removal frivolous and intended to delay; the Mississippi Supreme Court affirmed.

Issue	Dillards' Argument	Ashley Healthcare Plan's Argument	Held
1) May a Mississippi court award fees under the Litigation Accountability Act for a frivolous removal to federal court?	State statute permits fees against claims or defenses without substantial justification, including frivolous removals; state court may sanction.	Federal remedies (Rule 54) are the proper route; state court cannot award for removal-related fees.	Yes. The Act authorizes Mississippi courts to sanction frivolous removals; federal court is not the exclusive remedy.
2) Was Ashley’s removal frivolous / without substantial justification?	Removal was frivolous because federal precedent (including district-court decisions) clearly established that ERISA does not preempt chancery approval of minors’ settlements and that reimbursement claims were not cognizable under ERISA enforcement provisions.	Removal raised a reasonable (at least debatable) federal preemption question; Fifth Circuit precedent (e.g., Arana) and unsettled authority made removal non-frivolous.	The chancery court did not abuse discretion: removal sought a remedy not available under ERISA §502(a) and ran counter to controlling precedent in the Northern District of Mississippi, so removal was frivolous and sanctionable.

Mertens v. Hewitt Associates, 508 U.S. 248 (U.S. 1993) (limits ERISA equitable relief to traditional forms of equitable relief)
Great–West Life & Annuity Ins. Co. v. Knudson, 534 U.S. 204 (U.S. 2002) (recovery of money at law is not equitable relief under ERISA §502(a))
Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58 (U.S. 1987) (complete preemption doctrine creates federal-question removal when Congress so completely pre-empts an area)
Pilot Life Ins. Co. v. Dedeaux, 481 U.S. 41 (U.S. 1987) (ERISA’s broad preemption language and its limits)
Shaw v. Delta Air Lines, Inc., 463 U.S. 85 (U.S. 1983) (definition of when a state law “relates to” an ERISA plan)
Bauhaus USA, Inc. v. Copeland, 292 F.3d 439 (5th Cir. 2002) (ERISA plaintiff’s reimbursement claim not cognizable under §502(a) — appeal disposition on merits addressing remedy)
Arana v. Ochsner Health Plan, 338 F.3d 433 (5th Cir. 2003) (Fifth Circuit found ERISA preemption in a Louisiana statute context; discussed by dissent as supporting removal)
Beneficial Nat’l Bank v. Anderson, 539 U.S. 1 (U.S. 2003) (well-pleaded complaint rule for federal-question jurisdiction)