López-Muñoz v. Triple-S Salud, Inc.
754 F.3d 1
1st Cir.2014Background
- Raquel López-Muñoz, covered under an FEHBA plan, sought gastric lap band surgery; insurer Triple-S Salud initially denied, later authorized, then withheld coverage citing cost disputes.
- López-Muñoz sued in Puerto Rico Court of First Instance for tort and breach of contract damages arising from the insurer’s refusal to cover the procedure.
- Triple-S removed to federal district court asserting (1) FEHBA complete preemption of local-law claims and (2) federal-officer removal; only the preemption ground was pursued.
- The district court denied remand, held FEHBA completely preempted the claims, and dismissed without prejudice for failure to exhaust administrative remedies.
- First Circuit reviews whether FEHBA (plus OPM regulations) completely preempts state-law claims that arise from denial of benefits and whether federal jurisdiction existed.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Does FEHBA completely preempt local-law claims arising from an insurer's denial of benefits, thereby creating federal-question jurisdiction? | López-Muñoz: claims are local tort/contract damages, not federal benefits claims; removal improper. | Triple-S: FEHBA preemption clause and OPM regs create exclusive federal cause of action for benefit-denial disputes, supporting removal. | No. FEHBA does not completely preempt such local-law claims; removal on that basis was improper. |
| Do OPM regulations (administrative-review requirement and naming OPM as defendant) convert state claims into exclusively federal claims? | López-Muñoz: OPM regs cannot supply congressional intent to create exclusive federal remedy. | Triple-S: OPM’s 1996 regulatory scheme requires exhaustion and directs suits to OPM, implying exclusive federal forum. | No. An agency regulation cannot supply the congressional intent required for complete preemption. |
| Does the 1998 amendment to FEHBA’s preemption clause change the jurisdictional analysis to support complete preemption? | López-Muñoz: amendment strengthens defensive preemption but does not create federal jurisdiction. | Triple-S: amendment broadened preemption and supports exclusive federal remedy. | No. Supreme Court precedent (Empire) considered the amendment and still found FEHBA not jurisdiction-conferring. |
| Could any other federal question or "federal ingredient" doctrine sustain federal jurisdiction? | López-Muñoz: not argued or shown. | Triple-S: did not press federal-ingredient theory on appeal. | Waived. Removing party bears burden; defendant did not establish federal-ingredient jurisdiction. |
Key Cases Cited
- Empire HealthChoice Assur., Inc. v. McVeigh, 547 U.S. 677 (FEHBA preemption clause is not jurisdiction-conferring)
- Beneficial Nat'l Bank v. Anderson, 539 U.S. 1 (complete preemption requires an exclusive federal cause of action)
- Metro. Life Ins. Co. v. Taylor, 481 U.S. 58 (obvious preemption defense does not create removal jurisdiction)
- Fayard v. Ne. Vehicle Servs., LLC, 533 F.3d 42 (1st Cir.) (elements and rarity of complete preemption)
- BIW Deceived v. Local S6, Indus. Union of Marine & Shipbldg. Workers, 132 F.3d 824 (1st Cir.) (removal and well-pleaded complaint/artful pleading doctrine)
- Rivet v. Regions Bank, 522 U.S. 470 (artful pleading doctrine and recharacterization of claims)