George W. Mathias v. Michael M. Mihm
2017 U.S. App. LEXIS 14803
| 7th Cir. | 2017Background
- Mathias, a former Caterpillar employee, had health benefits terminated after Caterpillar sought unpaid premiums following a retroactive retirement status change.
- Mathias sued Caterpillar and its health plans in the Eastern District of Pennsylvania; plan documents contained a forum-selection clause requiring suit in the Central District of Illinois.
- Caterpillar moved under 28 U.S.C. § 1404(a) to transfer to the Central District of Illinois; the Eastern District granted the transfer relying on precedent that enforces ERISA plan forum clauses.
- After transfer, Mathias moved to retransfer the case back to Pennsylvania; the Central District denied retransfer, deferring to law-of-the-case and the Eastern District’s reasoning.
- Mathias petitioned the Seventh Circuit for mandamus asking to compel retransfer, arguing ERISA’s venue provision, 29 U.S.C. § 1132(e)(2), precludes enforcement of plan forum-selection clauses; the Secretary of Labor filed an amicus brief supporting Mathias.
- The Seventh Circuit majority denied mandamus, holding ERISA’s venue provision is permissive and does not invalidate a plan’s forum-selection clause that selects a district listed in § 1132(e)(2).
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether ERISA § 1132(e)(2) precludes enforcement of a forum-selection clause in an ERISA plan | Mathias: § 1132(e)(2) grants beneficiaries a statutory right to choose any listed venue; plan clauses that override that right are invalid | Caterpillar: § 1132(e)(2) is permissive ("may be brought"); parties can contractually select among listed federal districts | Court: § 1132(e)(2) is permissive and does not invalidate a forum-selection clause that selects a district listed in the statute |
| Whether Atlantic Marine’s § 1404(a) framework applies to ERISA plan forum clauses | Mathias: ERISA’s protective purpose should supersede contractual forum clauses | Caterpillar: Atlantic Marine governs and forum clauses are controlling except in extraordinary public-interest cases | Court: Atlantic Marine applies; a valid forum clause controls unless inconsistent with ERISA (court found no inconsistency) |
| Whether precedent like Boyd requires invalidating forum clauses that limit statutory venues | Mathias/Secretary: Boyd supports treating venue provisions as substantive rights that cannot be contractually waived | Caterpillar: Boyd is inapposite and predates the modern favorable treatment of forum clauses (Bremen, Atlantic Marine) | Court: Boyd does not control; modern jurisprudence recognizes enforceability of forum clauses and text of § 1132(e)(2) does not forbid them |
| Whether mandamus relief is appropriate to reverse the transfer | Mathias: Transfer was wrongful because clause is invalid under ERISA | Caterpillar: Transfer was proper under § 1404(a) and Atlantic Marine; retransfers are disfavored absent extraordinary circumstances | Court: Mandamus denied — Mathias did not show a clear and indisputable legal right to reversal |
Key Cases Cited
- Smith v. Aegon Cos. Pension Plan, 769 F.3d 922 (6th Cir. 2014) (holds ERISA venue provision permissive and enforces plan forum-selection clauses)
- Atl. Marine Constr. Co. v. U.S. Dist. Court for W. Dist. of Tex., 134 S. Ct. 568 (2013) (forum-selection clauses alter § 1404(a) analysis and should be given controlling weight except in unusual cases)
- Carnival Cruise Lines, Inc. v. Shute, 499 U.S. 585 (1991) (forum-selection clauses are presumptively valid even without arm’s-length bargaining)
- Boyd v. Grand Trunk W. R.R. Co., 338 U.S. 263 (1949) (contractual forum-selection clause invalidated under FELA; relied on by dissent but distinguished by majority)
- US Airways, Inc. v. McCutchen, 569 U.S. 88 (2013) (ERISA scheme built on relying on written plan documents)
- Fry v. Exelon Corp. Cash Balance Pension Plan, 571 F.3d 644 (7th Cir. 2009) (employers may vary by contract aspects ERISA leaves variable)