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Yolanda Bozeman v. the Lincoln National Life Insurance Company D/B/A Lincoln Financial Group

July 12, 2011

YOLANDA BOZEMAN, PLAINTIFF,
v.
THE LINCOLN NATIONAL LIFE INSURANCE COMPANY D/B/A LINCOLN FINANCIAL GROUP, DEFENDANT ,



The opinion of the court was delivered by: Herndon, Chief Judge:

MEMORANDUM and ORDER

Before the Court is defendant The Lincoln National Life Insurance Company's motion to dismiss the complaint (Doc.6) and plaintiff Yolanda Bozeman's motion to remand (Doc. 9). Defendant argues that the complaint must be dismissed for failure to state a claim pursuant to Federal Rule of Civil Procedure 12(b)(6). Plaintiff argues that the cause must be remanded because defendant failed to file a motion for removal within thirty days of being served. For the following reasons, plaintiff's motion to remand is denied, and defendant's motion to dismiss is granted without prejudice.

I. Background

Plaintiff commenced this action in state court on August 6, 2010, by filing a complaint against defendant in St. Clair County circuit court. Plaintiff's complaint asserts a claim for benefits under a state law breach of contract theory and a claim for statutory penalties and attorney's fees for vexatious and unreasonable conduct under the Illinois Insurance Code, 215 ILCS 5/155. According to the complaint, the facts of which we accept as true, in late 2004, plaintiff became employed by Life Skills Foundation. On July 1, 2005, defendant issued a long term disability insurance policy to Life Skills Foundation under which plaintiff became eligible for benefits. In 2008, plaintiff suffered injuries in an automobile collision. Plaintiff began receiving long term disability benefits in August 2008 and continued receiving them until July 2009 when defendant failed to continue paying. Plaintiff alleges that this was error and that plaintiff is now and has been eligible to receive benefits under the policy since defendant stopped paying.

On October 8, 2010, defendant removed this case to this Court. In the notice of removal defendant argued that this court had jurisdiction because plaintiff's state law claims were preempted by the Employee Retirement Income Security Act of 1974, 29 U.S.C. §§ 1001 et seq. ("ERISA"). On October 15, 2010, defendant filed a motion to dismiss the complaint (Doc. 6) along with a memorandum in support of thereof (Doc. 7), asserting that plaintiff's state law claims were preempted by ERISA. On November 15, 2010, plaintiff filed a response to defendant's motion to dismiss (Doc. 11), and on November 29, 2010, defendant filed a reply in support of the motion to Page 2 of 11 dismiss (Doc. 14).

On November 5, 2010, plaintiff filed a motion to remand (Doc. 9) along with a memorandum in support of that motion (Doc. 10). On December 8, 2010, defendant filed a response to plaintiff's motion to remand (Doc 15), and on December 21, 2010, plaintiff filed a reply to defendant's response to the motion to remand (Doc. 17). The Court now turns to address plaintiff's motion to remand and then defendant's motion to dismiss.

II. Motion to Remand

Section 1446(b) of the United States Code provides that a notice of removal must be filed by a defendant within thirty days of receipt by the defendant of the initial pleading or within thirty days of service of summons. 28 U.S.C. 1446(b). Federal Rule of Civil Procedure 4(h)(1)(B) states that a corporation must be served "by delivering a copy of the summons and of the complaint to an officer, a managing or general agent, or any other agent authorized by appointment or by law to receive service of process." FED. R. CIV. P. 4(h)(1)(B). The question presented by plaintiff's motion to remand is whether defendant timely filed a proper notice of removal.

The dispute centers around whether defendant was served on August 30, 2010, or September 13, 2010. It is undisputed that a summons was issued on August 17, 2010, to serve defendant at the following address: c/o Wendy Sullivan, 10176 Corporate Square Dr., Suite 100, St. Louis, MO 63132-2924. The summons was served at this address on August 30, 2010. This address, however, was actually the address for Life Skills Foundation, plaintiff's former employer who purchased the insurance policy from defendant and who acted as the plan administrator. Life Skills Foundation then mailed the summons to defendant who stamped it received September 13, 2010.

Plaintiff argues that defendant failed to file for removal within the thirty day period allowed by 28 U.S.C. § 1446. Plaintiff bases the argument for remand on the summary plan description of the policy in issue which provides that Life Skills Foundation is the agent for service of process. Plaintiff thus argues that service upon Life Skills Foundation was effective as to defendant and that defendant failed to remove before September 29, 2010, thirty days from the service of process on Life Skills Foundation. Plaintiff also argues that defendant never filed a proper notice of removal required by 28 U.S.C. §1446(a).

Defendant counters by arguing that it has never been formally served under Federal Rule of Civil Procedure 4(h). Defendant asserts that the plan in question clearly states that Life Skills Foundation is not defendant's agent and therefore defendant was never served with process. Defendant argues that it has committed no action prior to filing its notice of removal that would constitute a waiver of service and therefore it timely filed for removal.

The summary plan description ("the summary") contains several relevant portions. First, the summary states that "[t]he [p]lan [d]ocument will govern if there is any discrepancy between the information contained in this [d]description and the [p]lan." The summary then goes on to name Life Skills Foundation as the plan administrator and states that "[t]he [p]lan [a]dministrator is responsible for the administration of the [p]lan and is the designated agent for service of legal process for the [p]lan." The plan document itself however contradicts this, stating that "for all purposes of this [p]olicy, the [p]olicyholder acts on its own behalf or as the [e]mployee's agent. Under no circumstances will the [p]olicyholder be deemed the [c]ompany's agent." (Doc.7 Ex. A). The plan document goes on to name Life Skills Foundation as the policyholder and defendant as the company. (Doc. 7).

In Murphy Bros., Inc. v. Michetti Pipe Stringing, Inc., 526 U.S. 344, 347-48 (1999), the Supreme Court held that, "a named defendant's time to remove is triggered by simultaneous service of the summons and complaint, or receipt of the complaint, through service or otherwise, after and apart from service of the summons, but not by mere receipt of the complaint unattended by any formal service." Id. at 344. Here, plaintiff served Life Skills Foundation with the summons and complaint on August 30, 2010, but defendant did not receive it until September 13, 2010, after Life Skills Foundation forwarded them on to defendant. Accordingly, without formal service effected on the named defendant, the time limit for removal was not triggered by plaintiff's service on Life Skills Foundation. Life Skills Foundation is not a party in this cause and the plan document, to which the plan summary defers, forbids Life Skills Foundation from acting as an agent for defendant. Thus, defendant timely filed the notice of removal.

Plaintiff also argues that defendant never filed a proper notice of removal in compliance with 28 U.S.C. § 1446(a) because defendant did not file a notice of removal but rather a notice of filing notice of removal. Section 1446(a) provides that a defendant must file a notice of removal "containing a short and plain statement of the grounds for removal, together with a copy of all process, pleadings, and orders served upon such defendant or defendants in such action." 28 U.S.C. § 1446(a). Defendant's notice of filing notice of removal, filed on October 8, 2010, states that the action is removable due to ERISA preemption. Attached to the notice of filing notice of removal is a copy of the complaint, summons, and the policy in question. These documents are the entirety of the processes, pleadings, and orders ...


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