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ALLEMAN v. BLUECROSS BLUESHIELD OF ILLINOIS
October 3, 2002
JOHN D. ALLEMAN, INDIVIDUALLY, AND AS "CLASS REPRESENTATIVE," PLAINTIFF,
BLUECROSS BLUESHIELD OF ILLINOIS, AS ADMINISTRATOR OF THE ASSOCIATES' HEALTH AND WELFARE PLAN FOR WAL-MART AND SAM'S ASSOCIATES/PARTNERS, DEFENDANT
The opinion of the court was delivered by: J. Phil Gilbert, District Judge
This matter comes before the Court on the plaintiff's motion to
remand. (Doc. 11). The defendant has responded. (Doc. 13). For the
reasons discussed below, the Court will grant the motion to remand.
The plaintiff, John Alleman, is an attorney. At all times relevant to
this action, Donna Newcomb (who is not a party) was an employee at
Wal-Mart and had health insurance through the "Associates Health and
Welfare Plan," an ERISA plan (hereinafter "the Plan"). The plaintiff
alleges that the defendant, Blue Cross/Blue Shield of Illinois, is the
Newcomb was involved in an automobile accident, sustained injuries and
incurred medical bills, of which $5,513.60 were paid by the Plan. She
hired Alleman to represent her interests in a personal injury suit
against the other driver. Alleman worked for a 1/3 contingent fee and
settled Newcomb's claim for $100,000.00. Alleman created a common fund,
out of which he paid $5,513.60 to Blue Cross/Blue Shield as was required
by the Plan's reimbursement provision.
The reimbursement provision of the Plan further provided that there
would be no reduction of the Plan's lien for attorney's fees.
Nevertheless, Alleman sought attorney's fees, under the Illinois Common
Fund Doctrine, from Blue Cross/Blue Shield for 1/3 of the amount
remitted. Blue Cross/Blue Shield refused, and Alleman filed suit against
Blue Cross/Blue Shield in Jackson County, Illinois on behalf of himself
and an alleged class of similarly situated attorneys. His Complaint
asserts a claim under the Common Fund Doctrine.
The defendant removed the case to this Court under 28 U.S.C. § 1441
on the basis of diversity and federal question jurisdiction. The
plaintiff's motion to remand followed.
Section 1332(a) confers upon federal courts subject matter jurisdiction
over civil actions where the amount in controversy exceeds $75,000.00 and
there is complete diversity of citizenship. The defendant now concedes
that the jurisdictional amount is not satisfied in this case. The
individual plaintiff's claim is well below $75,000.00. Under Zahn v.
International Paper Co., 414 U.S. 291 (1973), multiple plaintiffs with
separate claims must each meet the jurisdictional amount requirement.
Therefore, even though the plaintiff purportedly brings this suit on
behalf of a class, the jurisdictional amount is not satisfied by the
class's aggregate claim — even assuming that such a claim is
greater than $75,000.00.
Section 1331 confers upon federal courts subject matter jurisdiction
over civil actions "arising under" the laws of the United States. As a
general rule, whether a case arises under federal law is determined by
what appears in the plaintiff's well pleaded complaint as "[i]t is long
settled law that a cause of action arises under federal law only when the
plaintiff's well-pleaded complaint raises issues of federal law."
Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63 (1987) (citing
Gully v. First National Bank, 299 U.S. 109 (1936)). "Thus the defendant
cannot cause a transfer to federal court simply by asserting a federal
question in his responsive pleading." Rice v. Panchal, 65 F.3d 637, 639
(7th Cir. 1995). This is the so-called "well-pleaded complaint rule."
In this case, the face of the plaintiff's complaint does not raise any
There is, however, an exception to the to the well-pleaded complaint
rule — the "complete preemption doctrine." This jurisdictional
doctrine provides that "to the extent that Congress has displaced a
plaintiff's state law claim, that intent informs the well-pleaded
complaint rule, and a plaintiff's attempt to utilize the displaced state
law is properly `recharacterized' as a complaint arising under federal
law." Rice, 65 F.3d at 640 n. 2 (citing Metropolitan Life Ins. Co. v.
Taylor, 481 U.S. 58, 64 (1987)).
The jurisdictional doctrine of complete preemption is often confused
with "conflict preemption." Conflict preemption exists when a federal
law provides a defense to a state law claim. Rice, 65 F.3d at 639.
Federal defenses can be raised in state court, and they do not create
federal jurisdiction. Id at 639-40. On the other hand, "federal subject
matter jurisdiction exists if the complaint concerns an area of law
`completely preempted' by federal law, even if the complaint does not
mention a federal basis of jurisdiction." Jass v. Prudential Health Care
Plan, 88 F.3d 1482, 1487 (7th Cir. 1996) (citing Rice, 65 F.3d at 642).
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