United States District Court, C.D. Illinois
GEORGE W. MATHIAS, Plaintiff,
CATERPILLAR, INC., et al., Defendants.
EDUARDO C. ROBRENO, J.
Employee Retirement Income Security Act, or ERISA, action
arises out of a billing dispute related to the retirement of
Plaintiff George Mathias. Plaintiff alleges that his health
insurance plan, Defendant Caterpillar, Inc. Retiree Group
Insurance Plan (the “RGIP”), which is sponsored
by Defendant Caterpillar, Inc., mistakenly under-billed him
for premium payments for several years. Then, when Plaintiff
could not pay the accumulated sum that he owed, the RGIP
improperly terminated his benefits.
the Court is Defendants' motion to transfer this matter
to the United States District Court for the Central District
of Illinois, based on a forum selection clause in the RGIP.
ECF No. 6. In the alternative, Defendants argue that this
Court is an “inappropriate forum, ” because (1)
Plaintiff lives and worked in York County, Pennsylvania,
which is located within the Middle District of Pennsylvania,
and (2) the administration of the ERISA plans primarily
occurred in the Central District of Illinois, where
Caterpillar's central offices are located. Still in the
alternative, Defendants also move to dismiss Plaintiff's
claims pursuant to Federal Rule of Civil Procedure 12(b)(6)
as time-barred and otherwise not cognizable under ERISA. For
the reasons that follow, the Court will enforce the
RGIP's forum selection clause and transfer this matter,
pursuant to 28 U.S.C. § 1404(a), to the Central District
who currently resides in Hanover, Pennsylvania, worked as a
machine tool operator for Defendant Caterpillar, Inc.,
beginning in 1978, most recently in Caterpillar's York,
Pennsylvania, plant. Compl. ¶¶ 1, 13. Defendants
Caterpillar, Inc.; Caterpillar, Inc. Group Insurance Plan A;
Caterpillar, Inc. Group Insurance Plan B; and Caterpillar,
Inc. Retiree Group Insurance Plan are the “plan
administrator” and “plan sponsor” within
the meaning of ERISA, 29 U.S.C. § 1002(16)(A), (B).
Id. ¶ 4. Caterpillar, Inc. is an Illinois
corporation with its headquarters in Illinois. Id.
Complaint, Plaintiff alleges that he “went out on
disability in 1997” due to chronic, severe chest pain
that he suffered after undergoing a quintuple coronary artery
bypass surgery, which required him to take narcotic drugs.
Id. ¶¶ 13-17. From 1997 until
approximately 2013, Plaintiff was covered “by
Defendant's health insurance plans as an employee on
long-term disability, and [paid] insurance premiums at the
disabled employee rate.” Id. ¶ 18.
September 5, 2012, Plaintiff retroactively retired effective
October 1, 2009. Compl. ¶¶ 28(a), 31; Compl. Ex. O
at 2. Due to an “administrative oversight, ”
Caterpillar continued to provide Plaintiff with “health
care benefits under [one of the employee health care plans]
as an employee on disability” through May 2013. Compl.
¶ 33(a), (c). For the period from October 1, 2009, to
May 2013, Caterpillar billed Plaintiff for health insurance
benefits at the lower employee premium rate, rather than at
the higher premium rate charged to retirees. Id.
2013, Caterpillar corrected the administrative error, and
properly classified Plaintiff as a retiree on and after
September 30, 2009. Id. ¶¶ 28(a), 33(c).
Caterpillar then refunded Plaintiff his employee premiums and
billed him for the higher retiree premiums he should have
been paying beginning on October 1, 2009, the date of his
retirement. Id. ¶¶ 21, 33; Ex. O at 3. The
amount Plaintiff owed was $9, 513.13. Compl. ¶ 33(d);
Ex. O at 3.
with this invoice, Plaintiff filed an administrative claim
under the RGIP. Id. Ex. O at 1. On October 1, 2013,
the Plan Administrator denied the claim. Id. The
denial letter explained that upon Plaintiff's retirement,
he became eligible for retiree benefits, which required
higher premiums. Id. at 2-3. Although the Plan
Administrator admitted that the billing error resulted from
an “administrative oversight, ” Plaintiff was
nonetheless obligated to pay the premium amounts he should
have paid as a retiree. Id. at 3. The Plan
Administrator extended the deadline for Plaintiff to make
payment until a “final decision is made on appeal if
Mr. Mathias files an appeal.” Id. at 3 n.5.
March 28, 2014, Plaintiff filed an appeal of the denial. On
April 25, 2014, the Caterpillar Benefits Appeals Committee
denied the appeal. Kyleen Martin Decl. Ex. F at 1, ECF Nos.
6-10. The Committee determined that the
administrative mistakes “were the result of processing
a retroactive retirement, which is an atypical process,
” and that Plaintiff was still required to pay the
retiree premium amounts for the period beginning on October
1, 2009. Id. at 3. The Committee further noted that
it “has the authority and the fiduciary obligation to
interpret and enforce the terms of [the Plans] as written,
including the provisions regarding the determination of and
the payment of premiums, and the authority and obligations to
decide questions of eligibility for participation in the
appeal denial letter pointed out to Plaintiff that
“[p]ursuant to the terms of the [RGIP], any court
action to (a) recover plan benefits or (b) enforce or clarify
rights under Section 502 of ERISA must be commenced within
six months after the date of this letter and such action must
be brought in the U.S. District for the Central District of
Illinois where RGIP is administered.” Id. at
6. As discussed below, this directive was contained in the
plan documents in effect at the time Plaintiff agreed to
accept benefits under the RGIP.
did not file this action until nearly two years later, on
April 19, 2016. See ECF No. 1. He brings two counts in his
complaint. First, he alleges that the termination of his
health care benefits was “arbitrary and
capricious” because, among other things, the
“accumulation of premiums was due to [Defendants']
own mistake, and not any misconduct on the part of the
Plaintiff.” Compl. ¶ 41. He therefore seeks
payment of his health insurance premiums, reinstatement of
his health insurance benefits, reimbursement for health care
expenses which should have been paid under the Plan, and
attorney's fees and costs pursuant to 29 U.S.C.
§§ 1132(a)(1)(B), (a)(3), and (g)(1). Second, he
alleges, pursuant to 29 U.S.C. § 1132(1)(1)(A), that
Defendants breached their fiduciary duty by, among other
things, “ignor[ing] uncontradicted evidence of Mathias
having paid all of his premiums required under the
circumstances”; “terminat[ing] benefits where
there was no evidence to support a change in the
Defendants' prior determination of Mathias' status as
a beneficiary of the Plan”; “allow[ing] the
existence of a conflict of interest, namely, the fact that
Defendants' benefits are funded directly out of
Caterpillar's operating income, to adversely impact the
neutrality of the decision making process”; and
“breach[ing] numerous procedural errors that adversely
[a]ffected the decision making process.” Id.
April 19, 2016, Plaintiff filed an application to proceed in
forma pauperis, attaching the Complaint. ECF No. 1. The
following day, the Court granted Plaintiff leave to proceed
in forma pauperis, and Plaintiff filed his Complaint. ECF
Nos. 2, 3.
filed a joint Motion to Transfer or Dismiss on July 7, 2016.
ECF No. 6. Plaintiff filed a response in opposition thereto
on July 20, 2016. ECF No. 7.
Court held a hearing on Defendants' motion on August 17,
2016. ECF Nos. 9, 10. At the hearing, the Court explained
that it would consider only the motion to transfer at this
time, because arguments made in connection with the motion to
dismiss would be better addressed by the transferee forum in
the event that transfer was ordered.
MOTION TO TRANSFER
submit that the RGIP contains a forum selection clause
requiring this suit to be brought in the United States
District Court for the Central District of Illinois. They
explain that the RGIP, Martin Decl. Ex. A at § 5, ECF
No. 6-3, incorporates the claims procedure found in the
Caterpillar Retiree Benefit Plan, Id. Ex. C at
§§ 10.1-10.5. The claims procedure, in turn,
contains a forum selection clause requiring that “[a]ny
court action to recover Program benefits, or to enforce or
clarify rights under the Program under section 502 of ERISA .
. . be brought in the U.S. District Court for the Central
District of Illinois, where the Program is
administered.” Id. at § 10.5. Defendants
ask the Court to enforce the RGIP's forum selection
clause and transfer this case to the Central District of
Illinois. Defs.' Mot. Transfer at 7, ECF No. 6.
to 28 U.S.C. § 1404, a district court may transfer an
action to any other district “where it might have been
brought, ” so long as the transfer is “[f]or the
convenience of parties and witnesses” and “in the
interest of justice.” 28 U.S.C. § 1404(a).
in a case not involving a forum selection clause, a court
evaluates a § 1404(a) motion using such factors as the
convenience of the parties and the relevant public interests.
Atl. Marine Constr. Co. v. U.S. Dist. Ct. for W. Dist.
Tex.,134 S.Ct. 568, 581 (2013). “The calculus
changes, however, when the parties' contract contains a
valid forum-selection clause, which ‘represents the
parties' agreement as to the most proper
forum.'” Id. (quoting Stewart Org.,
Inc. v. Ricoh Corp.,487 U.S. 22, 31 (1988)). Because
forum selection clauses are “‘bargained for by
the parties, '” “‘a valid