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COKER v. TRANSWORLD AIRLINES INC.

March 13, 1997

DOUGLAS E. COKER, SR., and SUSAN COKER, Plaintiffs,
v.
TRANSWORLD AIRLINES INC., COOPERATIVE GROUP INSURANCE PLAN FOR EMPLOYEES OF TWA INC., and TRANSWORLD AIRLINES INC. RETIREMENT PLAN, Defendants.



The opinion of the court was delivered by: ALESIA

 Before the court is defendant Transworld Airlines Inc.'s ("TWA"), the TWA Retirement Plan for Mechanics and Related Employees, Dining Service Employees and Passenger Service Employees' ("the Retirement Plan"), and the TWA Group Medical, Dental and Disability Income Benefit Plans' ("the Group Benefit Plans") *fn1" (collectively, "defendants") motion to dismiss all counts of plaintiff Douglas E. Coker, Sr.'s ("Mr. Coker"), and Susan Coker's ("Mrs. Coker") (collectively, "plaintiffs") complaint pursuant to Federal Rule of Civil Procedure 12(b)(1) for lack of subject matter jurisdiction and Counts II and III pursuant to Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim upon which the court can grant relief. For the reasons that follow, the court grants in part and denies in part defendants' motion to dismiss.

 I. BACKGROUND

 TWA is an interstate carrier subject to the Railway Labor Act ("RLA"). See 45 U.S.C. § 151. The RLA requires air carriers and their employees, acting through their unions, to establish System Boards of Adjustment for the resolution of disputes over the interpretation and application of the parties' collective bargaining agreements. 45 U.S.C. § 184. Mr. Coker has worked for TWA for 29 years as a ramp service employee at O'Hare International Airport ("O'Hare") in Chicago, Illinois. He has been a member of the District Lodge 142 of the International Association of Machinists and Aerospace Workers, AFL-CIO ("IAM") since starting at TWA. IAM is a national labor organization authorized to act as a bargaining representative on behalf of workers like Mr. Coker pursuant to the RLA. See 45 U.S.C. § 151. During the time period relevant to this opinion, IAM and TWA had entered into and were bound by the terms of a collective bargaining agreement between them.

 The Group Benefit Plans provide health, life insurance, temporary disability, long-term disability, and death benefits to eligible employees of TWA and their spouses. The Retirement Plan provides retirement benefits to eligible employees of TWA. As an employee of TWA, Mr. Coker participated in both the Group Benefit Plans and the Retirement Plan. As his spouse, Mrs. Coker was a covered dependent under the Group Benefit Plans.

 On September 30, 1992, Mr. Coker was laid off, or furloughed. IAM filed a grievance with the System Board of Adjustment ("the Board") established by the TWA-IAM collective bargaining agreement, disputing the furlough on the grounds that TWA had violated its contract with IAM by using American Airlines employees to staff its ground operations.

 In early January 1995, plaintiffs received written confirmation from TWA indicating that their medical coverage would be continued under the Group Benefit Plans. During January and February 1995, while Mr. Coker was still furloughed, Mrs. Coker incurred medical expenses from three separate hospital admissions relating to a pre-existing medical condition. Aetna Life Insurance Company ("Aetna"), the Group Benefit Plans' third party administrator, made representations to the hospital that the hospitalizations would be covered under the Plans. Aetna paid nearly the entire amount of the first bill. However, plaintiffs were not reimbursed for either the remainder of the first bill or the subsequent bills.

 On March 2, 1995, IAM notified Mr. Coker that the Board had found that TWA was in violation of its obligations under the collective bargaining agreement with respect to O'Hare ramp service employees, including Mr. Coker. The Board's award ordered TWA to reinstate the furloughed ramp service employees at O'Hare, and provided that the employees furloughed effective September 30, 1992, would receive "the rate of pay in effect during their period of furlough, less any outside earnings, compensation, and unemployment insurance." (Brief in Support of Defs'. Mot. Dismiss Ex. 2 at 15). Mr. Coker was reinstated on June 26, 1995, and since then has been covered under TWA's benefit plans.

 Mr. and Mrs. Coker sued defendants because of the denial of medical benefits in January and February 1995, alleging federal promissory estoppel and breach of contract claims (Counts I and III, respectively) and a claim for interference with protected rights under the Employee Retirement Income Security Act ("ERISA"), as amended, 29 U.S.C. § 1140 (Count II).

 II. DISCUSSION

 A. Standard for deciding a Rule 12(b)(1) motion to dismiss

 The defendants move to dismiss the entire case for lack of subject matter jurisdiction. See FED. R. CIV. P. 12(b)(1). Alternatively, defendants move to dismiss Counts II and III for failure to state a claim upon which relief can be granted. See FED. R. CIV. P. 12(b)(6). When a party raises subject matter jurisdiction as one of several grounds for dismissal, the court shall first consider the 12(b)(1) motion, as dismissal under this rule renders all other motions for dismissal moot. See FED. R. CIV. P. 12(h)(3); Freiburger v. Emery Air Charter, Inc., 795 F. Supp. 253, 256 (N.D. Ill. 1992).

 The standard of review for a Rule 12(b)(1) motion to dismiss depends upon the purpose of the motion. See Freiburger, 795 F. Supp. at 256. If the motion merely challenges the sufficiency of the allegations of subject matter jurisdiction, then the court must accept as true all well-pleaded factual allegations and construe them favorably to the pleader. Rueth v. United States Environmental Protection Agency, 13 F.3d 227, 229 (7th Cir. 1993). However, if the motion denies the truth of the allegations, the court may "look beyond the jurisdictional allegations of the complaint and view whatever evidence has been submitted on the issue to determine whether in fact subject matter jurisdiction exists." Capitol Leasing Co. v. Federal Deposit Ins. Corp., 999 F.2d 188, 191 (7th Cir. 1993). Dismissal is proper if it appears beyond ...


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