Curry v. CTB McGraw-Hill, LLC

296 F. App'x 563

Opinions

MEMORANDUM

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Plaintiffs seek benefits under the Employee Retirement Income Security Act (“ERISA”) and state law. The district court granted Defendants’ motion to dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). We affirm.

I. Plaintiffs’ claims under ERISA

“[A] federal court has no jurisdiction to hear a civil action under ERISA that is brought by a person who is not a ‘participant, beneficiary, or fiduciary.’ ” Harris v. Provident Life & Accident Ins. Co., 26 F.3d 930, 933 (9th Cir.1994). Contrary to Plaintiffs’ assertions, we have not held that all common law employees are entitled to benefits under ERISA, 29 U.S.C. §§ 1001-1461. Instead, we look to the terms of the plans at issue to determine who is entitled to coverage. See, e.g., Burrey v. Pac. Gas & Elec. Co., 159 F.3d 388, 392-96 (9th Cir.1998); Vizcaino v. Microsoft Corp., 120 F.3d 1006, 1013-14 (9th Cir.1997) (en banc), cert. denied, 522 U.S. 1098, 118 S.Ct. 899, 139 L.Ed.2d 884 (1998) (“Vizcaino II”).

A. Retirement Plans

We affirm the district court’s decision that Plaintiffs were not eligible to participate in the retirement plans. The retirement plans restrict enrollment to those “whom the Employer treats as subject to federal wage withholding by the Employer for purposes of Section 3401.” In the complaint, Plaintiffs admit that they were on the payroll of Kelly Services and not paid by McGraw-Hill directly. These admissions are binding. See Am. Title Ins. Co. v. Lacelaw Corp., 861 F.2d 224, 226 (9th Cir.1988). Because Plaintiffs were on the payroll of Kelly Services, Plaintiffs were not subject to federal wage withholding by McGraw-Hill. Thus we affirm the district court as to the retirement plans.

B. Health, Welfare, and Cafeteria Plans

The health and welfare plans restrict eligibility to employees “on the U.S. payroll of the company.” As this court persuasively reasoned in Vizcaino v. Microsoft Corp., employees “on the United States payroll of the employer” are those “paid from its United States accounts.” 97 F.3d 1187, 1194 (9th Cir.1996) (“Vizcaino I”), opinion withdrawn by 105 F.3d 1334 (9th Cir.1997). By Plaintiffs’ own admissions, they were payrolled by a third party agency and not paid directly from McGraw-Hill’s United States accounts. We affirm the district court’s finding that Plaintiffs were not eligible for the health, welfare, and cafeteria plans because Plaintiffs were not on the U.S. payroll of the company.

II. Preemption

“ERISA does not preempt the claims of parties who do not have the right to sue under ERISA because they are neither participants in nor beneficiaries of an ERISA plan.” Miller v. Rite Aid Corp., 504 F.3d 1102, 1106 (9th Cir.2007). However, the district court’s jurisdiction over the state law claims was dependent on the ERISA claims, which the court did not have jurisdiction to consider. Thus, we affirm the dismissal of Plaintiffs’ state law claims because the district court lacked federal subject matter jurisdiction. We vacate the district court’s order dismissing Plaintiffs’ state law claims with instructions that the district court modify its order to dismiss those claims without prejudice.

AFFIRMED. JUDGMENT VACATED FOR MODIFICATION.

This disposition is not appropriate for publication and is not precedent except as provided by 9th Cir. R. 36-3.