Newpage Wisconsin System Inc. v. United Steel, Paper & Forestry, Rubber, Manufacturing, Energy Allied Industrial & Service Workers International Union
651 F.3d 775
7th Cir.2011Background
- NewPage Wisconsin operates Wisconsin mills and provides retiree health coverage under a Retiree Health Plan governed by CBAs with the United Steel Workers union.
- NewPage Wisconsin cut subsidies for retirees aged 65 or older, prompting a Union challenge under ERISA and LMRA in Ohio federal court.
- NewPage Wisconsin filed a parallel declaratory-judgment action in Wisconsin seeking to declare the changes compliant with its obligations.
- The Wisconsin action was dismissed on pleadings for lack of ERISA subject-matter jurisdiction and for lack of personal jurisdiction over NewPage Wisconsin.
- The Seventh Circuit addresses whether declaratory relief under ERISA § 502(a)(3) is jurisdictionally available and whether mirror-image jurisdiction applies, and whether remand for forum considerations is appropriate.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the action arises under federal law for jurisdiction | NewPage Wisconsin: ERISA/LMRA issues confer federal jurisdiction. | Union: Ohio suit already asserts federal questions; Wisconsin suit mirrors that controversy. | Yes; jurisdiction exists under ERISA § 502(e) and 1331; mirror-image approach governs. |
| Whether ERISA § 502(a)(3) jurisdiction is required for declaratory relief | NewPage Wisconsin: seeks declaratory relief without requesting equitable relief. | Union: underlying dispute is federal in nature; declaratory relief is jurisdictionally appropriate. | ERISA § 502(a)(3) jurisdiction not required where underlying dispute is federal; declaratory judgment viable under 1331. |
| Whether the district court abused its discretion on forum choice/remand | Wisconsin action should proceed; Ohio suit is pending but not controlling. | Ohio forum may be more suitable; Wisconsin dismissal was proper given pending Ohio proceedings. | Remand for consideration of practicality; vacate and decide consistent with the opinion. |
| Whether the Wisconsin court has subject-matter and personal jurisdiction over all parties | Court should resolve all issues in Wisconsin; complete jurisdiction exists over defendants. | Personal jurisdiction concerns in Ohio action precluded Wisconsin action at the time. | Subject-matter jurisdiction exists over all issues; personal jurisdiction over all contestants is present; proceed on remand. |
Key Cases Cited
- MedImmune, Inc. v. Genentech, Inc., 549 U.S. 118 (2007) (actual controversy; declaratory judgments depend on underlying dispute)
- Franchise Tax Bd. v. Construction Laborers Vacation Trust, 463 U.S. 1 (1983) (§ 2201 not a grant of jurisdiction; analyze underlying claims)
- Grable & Sons Metal Prods. v. Darue Eng’g & Mfg, 545 U.S. 308 (2005) (federal jurisdiction can rest on substantial federal question)
- Newell Operating Co. v. United Auto. Workers, 532 F.3d 583 (2008) (mirror-image approach to declaratory actions about ERISA plans)
- Envision Healthcare, Inc. v. PreferredOne Insurance Co., 604 F.3d 983 (7th Cir. 2010) (overruled aspects of Newell; deferential review for declaratory action status)
- Wilton v. Seven Falls Co., 515 U.S. 277 (1995) (prudential considerations in declaratory judgments)
- County Materials Corp. v. Allan Block Corp., 502 F.3d 730 (7th Cir. 2007) (mirror-image reasoning in declaratory judgments)
- Northeast Illinois Regional Commuter R.R. v. Hoey Farina & Downes, 212 F.3d 1010 (7th Cir. 2000) (defers to jurisdictional questions in complex declaratory matters)
- GNB Battery Technologies, Inc. v. Gould, Inc., 65 F.3d 615 (7th Cir. 1995) (considerations of corporate form and jurisdiction)
- Samuel C. Johnson 1988 Trust v. Bayfield County, 649 F.3d 799 (7th Cir. 2011) (mirror-image approach reaffirmed)
- Metropolitan Life Insurance Co. v. Taylor, 481 U.S. 58 (1987) (ERISA claims are federal in character by statute)
- Aetna Health Inc. v. Davila, 542 U.S. 200 (2004) (state regulation displaced by ERISA; preemption principles)