The Erisa Industry Committee v. City of Seattle ( 2021 )

FILED
NOT FOR PUBLICATION
MAR 17 2021
UNITED STATES COURT OF APPEALS MOLLY C. DWYER, CLERK
U.S. COURT OF APPEALS
FOR THE NINTH CIRCUIT
THE ERISA INDUSTRY COMMITTEE, No. 20-35472
Plaintiff-Appellant, D.C. No. 2:18-cv-01188-TSZ
v.
MEMORANDUM*
CITY OF SEATTLE,
Defendant-Appellee.
Appeal from the United States District Court
for the Western District of Washington
Thomas S. Zilly, District Judge, Presiding
Argued and Submitted March 1, 2021
Seattle, Washington
Before: TASHIMA, RAWLINSON, and BYBEE, Circuit Judges.
The ERISA Industry Committee (ERIC) appeals the district court’s Rule
12(b)(6) dismissal of its action against the City of Seattle (the City). In its
complaint, ERIC asserted that the Employee Retirement Income Security Act of
1974 (ERISA) preempted Seattle Municipal Code (SMC) § 14.28, a health benefits
*
This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
ordinance requiring hotel employers and ancillary hotel businesses to provide
money directly to designated employees, or to include those employees in the
employers’ health benefit plan.
Contrary to ERIC’s argument, “state and local laws enjoy a presumption
against [ERISA] preemption when they clearly operate in a field that has been
traditionally occupied by the States.” Golden Gate Rest. Ass’n v. City & Cnty. of
San Francisco, 546 F.3d 639, 647 (9th Cir. 2008) (citation and internal quotation
marks omitted); see also Depot, Inc. v. Caring for Montanans, Inc., 915 F.3d 643,
666 (9th Cir. 2019). Even so, unlike the statute in Gobeille v. Liberty Mutual Ins.
Co., which required disclosure of health care information and payments, SMC §
14.28 does not “enter[] a fundamental area of ERISA regulation,” such as reporting
and disclosure of health care claims and payments. 136 S. Ct. 936, 940, 946
(2016); see also N.Y. State Conf. of Blue Cross & Blue Shield Plans v. Travelers
Ins. Co., 514 U.S. 645, 661 (1995) (“[N]othing in the language of [ERISA] or the
context of its passage indicates that Congress chose to displace general health care
regulation, which historically has been a matter of local concern.”) (citations
omitted).
ERISA preempts “any and all State laws insofar as they may now or
hereafter relate to any employee benefit plan.” 29 U.S.C. § 1144(a). We agree
2
with the district court that SMC § 14.28 does not relate to any employee benefit
plan in a manner that triggers ERISA preemption. The outcome of this case is
controlled by our decision in Golden Gate. See 546 F.3d at 661 (concluding that a
San Francisco ordinance requiring business to make certain minimum health care
expenditures on behalf of covered employees was not preempted by ERISA). As
in Golden Gate, SMC §14.28 does not “relate to” employers’ ERISA plans because
an employer “may fully discharge its expenditure obligations by making the
required level of employee health care expenditures, whether those expenditures
are made in whole or in part to an ERISA plan, or in whole or in part to [a third
party].” Id. at 655-56.
ERIC argues that Golden Gate is distinguishable because the San Francisco
ordinance did not include a direct payment option from the employer to the
employee. However, we expressly noted in Golden Gate that there was no ERISA
preemption “even if the payments are made by the employer directly to the
employees who are the beneficiaries of the putative plan.” Id. at 649 (internal
quotation marks omitted). Golden Gate relied for this proposition on Fort Halifax
Packing Co., Inc. v. Coyne, 482 U.S. 1, 3, 16 (1987), which explicitly addressed
direct payment from the employer to the employee. See Golden Gate, 546 F.3d at
649.
3
Because ERIC failed to distinguish SMC § 14.28 on any meaningful point
from the ordinance upheld in Golden Gate, dismissal in favor of the City was
consistent with our precedent. See 546 F.3d at 661.
AFFIRMED.
4