754 F. Supp. 2d 550
E.D.N.Y.2010Background
- Schultz sues Newsday under NYSHRL alleging termination while on disability violated NYSHRL § 296(1)(a).
- Newsday terminated Schultz on Sept. 2, 2004 citing fraudulent circulation allegations and conduct; Schultz disputes the reasons.
- Schultz claimed termination aimed to cut off disability benefits; Newsday argued legitimate conduct basis.
- Schultz previously litigated federal issues; Judge Block dismissed federal claims in Schultz I (2009) and NYSHRL claim without prejudice.
- Newsday removed the current action to federal court (June 10, 2010) based on federal-question/ERISA preemption.
- Court denies remand, holds ERISA completely preempts Schultz’s NYSHRL claim and removal was proper under the complete-preemption doctrine.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether removal was proper under complete preemption | Schultz argues no ERISA basis; claim is NYSHRL-only | Newsday contends ERISA §510/502 preempts and permits removal | Removal proper; ERISA completely preempts the claim |
| Whether NYSHRL claim is preempted by ERISA | Claim seeks disability-based discrimination; not a benefits action | Claim seeks to deprive disability benefits, within ERISA §510/502 scope | Claim preempted under ERISA §§510/502; within scope of 502(a) |
| Whether the claim falls within ERISA §510 and §502 enforcement | Alleges discrimination unrelated to benefits | Alleges discharge to defeat benefits; directly linked to ERISA plan rights | Yes; falls within §510 and §502; completely preempted |
| Whether the artful-pleading doctrine applies to defeat removal | Plaintiff framed as NYSHRL claim | Claim is actually ERISA-based; preemption applies | Doctrine supports removal; ERISA preemption governs |
Key Cases Cited
- Shaw v. Delta Air Lines, Inc., 463 U.S. 85 (1983) (ERISA preemption limited by §514(d))
- Ingersoll-Rand Co. v. McClendon, 498 U.S. 133 (1990) (ERISA preemption broad reach; relation to plan matters)
- Paneccasio v. Unisource Worldwide, Inc., 532 F.3d 101 (2d Cir. 2008) (Preemption of state claims seeking benefits or relating to plans)
- Aetna Health Inc. v. Davila, 542 U.S. 200 (2004) (ERISA preemption and §502 enforcement scope)
- Metro. Life Ins. Co. v. Taylor, 481 U.S. 58 (1987) (ERISA preemption; benefits enforcement as exclusive remedy)
- Wood v. Prudential Ins. Co. of Am., 207 F.3d 674 (3d Cir. 2000) (Complete preemption under ERISA §510/§502 in certain contexts)
- Harris v. Mich. Consol. Gas Co., 117 F. Supp. 2d 642 (E.D. Mich. 2000) (Discrimination claims tied to benefits can be preempted)