On Appeal from the United States District Court for the Middle District of Pennsylvania (Scranton) (Civil Action No.87-1821).
Higginbotham, Stapleton, and Cowen, Circuit Judges.
This is an appeal from an order granting summary judgment in favor of defendant-appellees Michael Lindemuth ("Lindemuth") and The 65 Security Plan ("the Plan") against plaintiff-appellant Allstate Insurance Co. ("Allstate"). The core issue that Allstate seeks to have determined in this declaratory judgment action is whether its medical insurance coverage of Lindemuth or that of the Plan is primary. We conclude, however, that the district court lacked jurisdiction to consider the merits of the case, as do we. Consequently, we will vacate the judgment of the district court and will remand to that court with instructions that it in turn remand these proceedings to the state court whence they came.
Michael Lindemuth was involved in a car crash in September 1983 in which he sustained severe personal injuries. At the time of the accident, Lindemuth was covered as a dependent under a no-fault automobile insurance policy issued by Allstate to his father, Charles Lindemuth. He was also covered as a dependent under a medical insurance program provided by the Plan to cover employees at his father's place of employment.
Following the accident, claims for no-fault insurance benefits were presented to Allstate. Allstate paid those claims*fn1 but thereafter contended that its policy only provides "excess"*fn2 coverage and that the Plan must both reimburse Allstate for its payments to Lindemuth and assume responsibility for all such future payments. The Plan, however, citing its own "escape"*fn3 and "excess" clauses contended that it is not the primary insurer and refused to reimburse Allstate. Allstate is an insurance company authorized by the Commonwealth of Pennsylvania to issue various insurance policies and the Plan is an employee welfare plan governed by the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1002(1). Lindemuth is an adult Pennsylvania resident.
This declaratory judgment action was filed by Allstate in the Court of Common Pleas of Lycoming County, Pennsylvania. The Plan removed the suit to the United States District Court for the Middle District of Pennsylvania on the grounds that the Allstate action stated a claim under section 502 of ERISA, 29 U.S.C. § 1132 and 28 U.S.C. § 1331. Cross-motions for summary judgment were filed by the parties and the district court entered an order granting judgment in favor of the Plan and Lindemuth. This appeal followed.
In deciding whether the action was properly removed from state court pursuant to 28 U.S.C. § 1441*fn4 and 28 U.S.C. § 1331 ("federal question" jurisdiction), we must start our analysis with the "well-pleaded" complaint rule. Railway Labor Executives Ass'n v. Pittsburgh & Lake Erie Railroad Co., 858 F.2d 936, 939 (3d Cir. 1988). It has long been established that, for purposes of removal jurisdiction, "the well-pleaded complaint rule requires [that] the federal question be presented on the face of the plaintiff's properly pleaded complaint. See Gully v. First National Bank, 299 U.S. 109, 112-13, 81 L. Ed. 70, 57 S. Ct. 96 ." Id.; see Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 107 S. Ct. 1542, 1546, 95 L. Ed. 2d 55 (1987). Thus, the plaintiff is master of its own claim and can choose to keep its suit in state court if its well-pleaded complaint does not affirmatively rely on federal law. It also follows that a case may not be removed to a federal court on the basis of a federal defense, including one that the state law relied upon by the plaintiff has been preempted by federal law and that relief can be had, if at all, only under that federal law. As the Supreme Court has recently observed:
[A] case may not be removed to federal court on the basis of a federal defense, including the defense of pre-emption, even if the defense is anticipated in the plaintiff's complaint, and even if both parties concede that the federal defense is the only question truly at issue.
Caterpillar, Inc. v. Williams, 482 U.S. 386, 107 S. Ct. 2425, 2430, 96 L. Ed. 2d 318 (1987) (emphasis in original).
However, one "independent corollary" to the well-pleaded complaint rule is the "complete preemption doctrine." Under the complete preemption doctrine, "Congress may so completely pre-empt a particular area, that any civil complaint raising this select group of claims is necessarily federal in character." Metropolitan, 107 S. Ct. at 1546. Thus, we are presented with two issues: first, whether Allstate's state-court complaint relies upon a federal law ...