Mary Smith v. Regional Transit Authority, e, 756 F.3d 340

Transit system converted from private (NOPSI) to public ownership in 1983; RTA became sponsor and TMSEL administrator of the employee benefit plan per a 1983 Benefit Agreement.
Plaintiffs are ~40 former NOPSI/TMSEL employees/retirees who allege benefits (Medicare premium reimbursements, deductible reimbursements, and premium-free medical insurance) were reduced or eliminated beginning in 2006.
Plaintiffs sued in December 2012 under ERISA §§ 502(a)(1)(B) and (a)(2), naming RTA (sponsor) and TMSEL (administrator), seeking welfare and retirement benefits they claim they were entitled to.
Defendants moved to dismiss under Fed. R. Civ. P. 12(b)(1), contending the Plan is a “governmental plan” exempt from ERISA, and the district court granted dismissal for lack of subject-matter jurisdiction.
Fifth Circuit held the district court used the wrong procedural vehicle, vacated the dismissal, and remanded for reconsideration under Rule 12(b)(6) or Rule 56 (or trial if necessary).

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether ERISA’s "governmental plan" exclusion deprives federal courts of jurisdiction	Plaintiffs allege the Plan is covered by ERISA and so federal courts have jurisdiction to decide the claim	Defendants say the Plan is a governmental plan exempt from ERISA, so federal courts lack jurisdiction	The court held the governmental-plan question is a merits element, not a jurisdictional threshold; §1003(b)(1) is not clearly jurisdictional
Proper procedural vehicle to resolve governmental-plan question	Plaintiff: court should adjudicate claim on the merits (12(b)(6)/56)	Defendant relied on 12(b)(1) dismissal in district court	Court held dismissal should be via 12(b)(6) or 56 (or trial) because factual development is required; 12(b)(1) was improper here
Whether courts may resolve disputed facts when deciding coverage	Plaintiffs claim factual record supports ERISA coverage	Defendants argue factual record shows governmental status	Court: disputed facts matter; if facts outside pleadings are needed, use Rule 56 or trial; district court may weigh facts under 12(b)(1) but that was not the proper posture for merits resolution
Outcome and next step	Plaintiffs seek substantive remedy under ERISA	Defendants seek final dismissal	Court VACATED and REMANDED for reconsideration under appropriate procedural vehicle; did not decide merits

Arbaugh v. Y & H Corp., 546 U.S. 500 (Sup. Ct. 2006) (distinguishes jurisdictional prerequisites from elements of a claim)
Reed Elsevier, Inc. v. Muchnick, 559 U.S. 154 (Sup. Ct. 2010) (use term "jurisdictional" only where appropriate; registration rule not jurisdictional)
Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83 (Sup. Ct. 1998) (merits insufficiency is distinct from lack of subject-matter jurisdiction)
Shirley v. Maxicare Tex., Inc., 921 F.2d 565 (5th Cir. 1991) (earlier Fifth Circuit decision treating governmental-plan question as jurisdictional; court explains it is no longer controlling)
ACS Recovery Servs., Inc. v. Griffin, 723 F.3d 518 (5th Cir. 2013) (en banc) (held whether a claim is viable under ERISA is a merits question, not jurisdictional)