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PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
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KAREN BAURIES KING,
Plaintiff-Appellant,
v.No. 02-2139
MARRIOTT INTERNATIONAL,
INCORPORATED; KARL I. FREDERICKS,
Defendants-Appellees.
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Appeal from the United States District Court for the District of Maryland, at Greenbelt. Alexander Williams, Jr., District Judge. (CA-01-1208-AW)
Argued: June 5, 2003
Decided: July 28, 2003
Before WILKINSON, LUTTIG, and SHEDD, Circuit Judges.
____________________________________________________________
Vacated and remanded by published opinion. Judge Luttig wrote the
opinion, in which Judges Wilkinson and Shedd joined.
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COUNSEL
ARGUED: William Barnett Schultz, Civil Division, Appellate Staff,
UNITED STATES DEPARTMENT OF JUSTICE, Washington,
D.C., for Appellant. Todd James Horn, VENABLE, BAETJER &
HOWARD, L.L.P., Baltimore, Maryland, for Appellees. ON BRIEF:
Steven M. Salky, ZUCKERMAN, SPAEDER, L.L.P., Washington,
D.C.; Robert B. Fitzpatrick, FITZPATRICK & ASSOCIATES,
Washington, D.C., for Appellant.
OPINION
LUTTIG, Circuit Judge:
Karen King, the plaintiff-appellant, brought suit in Maryland state
court against Marriott International, Inc., her former employer, and
Karl I. Fredericks, her immediate supervisor, for wrongful discharge
under Maryland state law, asserting in particular that she was dis-
charged for complaining about and for refusing to violate the Employ-
ment Retirement Income Security Act of 1974, 29 U.S.C. § 1001 et
seq. ("ERISA"). The defendants removed the case to federal district
court, alleging that ERISA completely preempted her state cause of
action. After the district court denied King's motion for remand, the
district court granted summary judgment in favor of the defendants,
concluding that King had failed to present sufficient proof of a causal
link between her termination and her complaints about the manage-
ment of Marriott's benefits plan.
King appeals, contending that the district court erred by concluding
that her wrongful discharge claim was completely preempted by
ERISA. We agree with King, and so vacate the district court's judg-
ment and remand for further proceedings.
I.
Karen King was employed in Marriott's benefits department for
many years, and was by all accounts an excellent employee prior to
1999. In late 1998 or early 1999, however, a series of events began
that threw King into conflict with her supervisors. First, King learned
that defendant Fredericks, the Senior Vice President of Compensation
and Benefits, recommended that Marriott transfer millions of dollars
from its medical plan into its general corporate reserve account. King
doubted the appropriateness of this transfer and accordingly expressed
her concern to co-workers and to Fredericks.
By late 1999, King had been promoted by Fredericks and given
responsibilities regarding benefit plan finances. At this time, she
learned that the proposal to transfer the reserve funds had been
revived. She again objected to the transfer, fearing that such a transfer
2
would violate ERISA. She registered her objection with Fredericks,
as well as with two in-house attorneys, going so far as to request an
opinion letter from one of the in-house attorneys.
Also, in September 1999, Fredericks announced a restructuring of
responsibilities within the benefits department. King was promoted to
Vice President of Benefits Resources, and the responsibilities in the
benefits department were divided between King and a Ms. Brook-
bank. This division of responsibilities apparently was unsatisfactory
to the two subordinates, and the two began a disruptive feud. This
feud significantly affected the functioning of the benefits department,
even causing several employees to seek transfers.
In early 2000, Marriott proposed another transfer of funds from the
medical plan, and again King objected, both verbally and in writing
to Fredericks. In late March 2000, Fredericks fired both King and
Brookbank, for the purported reason that their continuing feud hin-
dered the operation of the benefits department.
King then brought suit against Marriott and Fredericks in Maryland
state court, alleging that her termination was wrongful and violative
of public policy under Maryland law. Defendants promptly removed
the case to federal district court in Maryland, contending that ERISA
preempted her wrongful termination claim. King moved to remand,
or in the alternative to amend her complaint to allege a variety of new
claims, including an explicit ERISA anti-retaliation claim. The district
court denied King's motion to remand, and granted her motion to
amend her complaint. Thereafter, however, the district court granted
summary judgment to defendants on all claims. On the ERISA anti-
retaliation claim and the state wrongful discharge claim, the district
court concluded that King had failed to establish a causal link
between her termination and her complaints regarding the manage-
ment of the ERISA plan. King now appeals, contending that the dis-
trict court erred by denying her motion to remand her wrongful
discharge claim.
II.
Defendants argue in support of the district court's denial of the
motion to remand the case solely on the grounds that King's claims
3
were completely preempted by ERISA. They thus present the ques-
tion whether, despite King's attempt to plead a state law cause of
action, King has actually pled a federal cause of action.
Although the plaintiff is generally the "master of his complaint,"
Custer v. Sweeney, 89 F.3d 1156, 1165 (4th Cir. 1996), the federal
removal statute allows a defendant to remove certain claims originally
brought in state court into federal court. 28 U.S.C. § 1441. Removal
is appropriate, however, only where the civil action is one over which
"the district courts of the United States have original jurisdiction." 28
U.S.C. § 1441(a). Hence, to determine if King's state wrongful dis-
charge claim was removable, we must analyze whether her claim
could have been brought originally in federal district court.
A civil action "arising under the Constitution, laws, or treaties of
the United States" can be brought originally in federal district court.
28 U.S.C. § 1331. Under the venerable well-pleaded complaint rule,
jurisdiction lies under section 1331 only if a claim, when pleaded cor-
rectly, sets forth a federal question; in other words, whether "a case
is one arising under the Constitution or a law or treaty of the United
States, in the sense of the jurisdictional statute, . . . must be deter-
mined from what necessarily appears in the plaintiff's statement of his
own claim in the bill or declaration, unaided by anything alleged in
anticipation or avoidance of defenses which it is thought the defen-
dant may interpose." Taylor v. Anderson, 234 U.S. 74, 75-76 (1914);
see Gully v. First Nat'l Bank, 299 U.S. 109, 112-13 (1936) ("[A] right
or immunity created by the Constitution or laws of the United States
must be an element, and an essential one, of the plaintiff's cause of
action."); Louisville & Nashville R.R. Co. v. Mottley, 211 U.S. 149,
152 (1908). Thus, ordinarily courts "look no further than the plain-
tiff's complaint in determining whether a lawsuit raises issues of fed-
eral law capable of creating federal-question jurisdiction under 28
U.S.C. § 1331." Custer, 89 F.3d at 1165. In particular, a claim in
which the federal question arises only as a defense to an otherwise
purely state law action does not "arise under" federal law, and hence
jurisdiction would not lie under section 1331. See Franchise Tax
Board v. Construction Laborers Vacation Trust, 463 U.S. 1, 12
(1983).
There is one corollary to the well-pleaded complaint rule. "Federal
pre-emption is ordinarily a federal defense to the plaintiff's suit."
4
Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63 (1987). There-
fore, a defendant's raising of the defense of federal preemption is,
under the well-pleaded complaint rule, insufficient to allow the
removal of the case to federal court. See Gully, 299 U.S. at 116 ("By
unimpeachable authority, a suit brought upon a state statute does not
arise under an act of Congress or the Constitution of the United States
because prohibited thereby."). But, in some cases, federal law so com-
pletely sweeps away state law that any action purportedly brought
under state law is transformed into a federal action that can be
brought originally in, or removed to, federal court. See Metropolitan
Life, 481 U.S. at 63-64, 67. The operation of this rule has come to be
known as the doctrine of "complete preemption." The Supreme Court
recently summarized the doctrine in Beneficial National Bank v.
Anderson, 2003 U.S. LEXIS 4277 (June 2, 2003). There, the Court
emphasized that the touchstone of complete preemption is "whether
Congress intended the federal cause of action" to be "the exclusive
cause of action" for the type of claim brought by a plaintiff. Id. at *15.
In cases of complete preemption, however, it is misleading to say
that a state claim has been "preempted" as that word is ordinarily
used. In such cases, in actuality, the plaintiff simply has brought a
mislabeled federal claim, which may be asserted under some federal
statute. See, e.g., Darcangelo v. Verizon Communications, Inc., 292
F.3d 181, 195 (4th Cir. 2002) ("[W]hen a claim under state law is
completely preempted and is removed to federal court because it falls
within the scope of § 502 [of ERISA], the federal court should not
dismiss the claim as preempted, but should treat it as a federal claim
under § 502."). Thus, a vital feature of complete preemption is the
existence of a federal cause of action that replaces the preempted state
cause of action. Where no discernable federal cause of action exists
on a plaintiff's claim, there is no complete preemption, for in such
cases there is no federal cause of action that Congress intended to be
the exclusive remedy for the alleged wrong.
We have found that ERISA does completely preempt many state
law claims. In particular, "when a complaint contains state law claims
that fit within the scope of ERISA's § 502 civil enforcement provi-
sion, those claims are converted into federal claims, and the action
can be removed to federal court." Darcangelo, 292 F.3d at 187.
5
The absence of a federal cause of action says nothing about
whether the state claim is preempted in the ordinary sense: it is
entirely within the power of Congress to completely eliminate certain
remedies by preempting state actions, while providing no substitute
federal action. See Custer, 89 F.3d at 1166 ("The absence of a particu-
lar remedy under ERISA, moreover, has no bearing on whether a state
law falls within the scope of § 514 [ERISA's preemption provi-
sion]."); see also Anderson v. Electronic Data Systems Corp., 11 F.3d
1311, 1314 (1994). But in such cases, preemption serves only as a
federal defense, the barred claims are not completely preempted, and
thus not removable to federal court.
With this framework firmly in mind, we turn now to the particulars
of King's complaint to determine whether ERISA provides a civil
remedy for the wrongs King alleges.
A.
We first must address defendants' argument that King has waived
her objection to removal by amending her complaint to explicitly
assert a cause of action under section 502 of ERISA. We agree with
the Fifth Circuit that "the Supreme Court has looked favorably upon
a plaintiff's argument that diligent objection renders the waiver doc-
trine inapplicable." Waste Control Specialists v. Envirocare, 199 F.3d
781, 785 (5th Cir. 2000), citing Caterpillar, Inc. v. Lewis, 519 U.S.
61, 72-77 (1996). In Caterpillar, analyzing the circumstance where a
case was wrongfully removed to federal court on the basis of diver-
sity, the Court noted that the plaintiff "by timely moving for remand,
did all that was required to preserve his objection to removal." 519
U.S. at 74. Hence, a plaintiff's claim that the removal of his case was
improper under 28 U.S.C. § 1441 is preserved when the plaintiff
timely moves for remand.
Even without this suggestion from Caterpillar, we would conclude
that King did not waive her objection to removal. King's amendment
of her complaint to make an express claim under ERISA did no more
than make explicit what the district court held (by concluding that her
state claim was completely preempted) she did inadvertently and
implicitly, namely, bring an action under Section 502 of ERISA.
6
Though in Caterpillar, the Court did ultimately affirm the lower
court judgment, despite the preserved objection to the removal, on the
basis that "once a diversity case has been tried in federal court, with
rules of decision supplied by state law under the regime of Erie R. Co.
v. Tompkins, 304 U.S. 64, 82 L. Ed. 1188, 58 S. Ct. 817 (1938), con-
siderations of finality, efficiency, and economy become overwhelm-
ing," 519 U.S. at 75, those interests are not present here. As noted by
the Fifth Circuit, a diversity case "differs fundamentally from a fed-
eral question case," Waste Control Specialists, 199 F.3d at 785 n.2,
in the context of complete preemption. An erroneous determination
by the district court that a particular claim is completely preempted
significantly shifts the nature of the law that would be applied to the
claim. The state claim wrongfully determined to be completely pre-
empted would be analyzed as a federal claim under federal law. See
Darcangelo v. Verizon Communications, Inc., 292 F.3d 181, 195 (4th
Cir. 2002). Upon a remand to a state court, however, the state claim
would be analyzed under the appropriate state law, which law may
contain rules of decision substantially different from the rules con-
tained in federal law. Wrongful removal here would thus destroy
King's legitimate state claim, rather than (as in the case of a
wrongfully-removed diversity action) simply change the identity of
the deciding court. Accordingly, we conclude that we can and should
address King's argument that the district court erroneously failed to
remand her state unlawful discharge claim.
B.
We turn then to the question of whether ERISA provides a cause
of action for the wrongs alleged by King. Section 502 of ERISA
creates a civil cause of action, invocable by many different parties for
particular effect. For present purposes, the only relevant portion of
section 502 is subsection 502(a)(3), which states that
[a] civil action may be brought - . . . (3) by a participant,
beneficiary, or fiduciary (A) to enjoin any act or practice
which violates any provision of this subchapter or the terms
of the plan, or (B) to obtain other appropriate equitable
relief (i) to redress such violations or (ii) to enforce any pro-
visions of this subchapter or the terms of the plan.
7
29 U.S.C. § 1132(a)(3).1 The only provision of ERISA which consti-
tutes the "provision" or "provisions of this subchapter" therein refer-
enced is section 510, which reads as follows:
It shall be unlawful for any person to discharge, fine, sus-
pend, expel, discipline, or discriminate against a participant
or beneficiary for exercising any right to which he is entitled
under the [the benefits plan, ERISA, or certain other statu-
tory provisions], or for the purpose of interfering with the
attainment of any right to which such participant may
become entitled under [the benefits plan, ERISA, or certain
other statutory provisions]. It shall be unlawful for any per-
son to discharge, fine, suspend, expel, or discriminate
against any person because he has given information or has
testified or is about to testify in any inquiry or proceeding
relating to this chapter or the Welfare and Pension Plans
Disclosure Act. The provisions of section 1132 of this title
shall be applicable in the enforcement of this section.
29 U.S.C. § 1140. And the only portion of section 510 possibly appli-
cable to King is the sentence barring the discharge of "any person
because he has given information or has testified or is about to testify
in any inquiry or proceeding relating to this chapter." Id.
The most immediate question is the proper scope of the phrase "in-
quiry or proceeding." In interpreting a very similar provision of the
Fair Labor Standards Act, 29 U.S.C. § 201 et seq., we concluded that
the term "proceeding" referred only to administrative or legal pro-
ceedings, and not to the making of an intra-company complaint. See
Ball v. Memphis Bar-B-Q Co., 228 F.3d 360, 364 (4th Cir. 2000).2 In
____________________________________________________________
1 The parties do not dispute that King was a "fiduciary" as defined in
ERISA.
2 The relevant provision in the FLSA makes it unlawful for an
employer
to discharge or in any other manner discriminate against any
employee because such employee has filed any complaint or
instituted or caused to be instituted any proceeding under or
related to this chapter, or has testified or is about to testify in any
such proceeding.
29 U.S.C. § 215(a)(3).
8
Ball, we said that "the `proceeding' necessary for liability . . . refers
to procedures conducted in judicial or administrative tribunals," not-
ing that "proceeding," in the Act, was "modified by attributes of
administrative or court proceedings." Id. In particular, we explained,
"testify" and "institute" both connote "a formality that does not attend
an employee's oral complaint to his supervisor." Id. We also con-
cluded that the FLSA's use of narrower language than that found in
the anti-retaliation provisions of Title VII of the Civil Rights Act of
1964 counseled a narrower interpretation of the scope of the FLSA's
anti-retaliation provision. Id.
In the instant case, as well, the use of the phrase "testified or is
about to testify" does suggest that the phrase "inquir[ies] or proceed-
ing[s]" referenced in section 510 is limited to the legal or administra-
tive, or at least to something more formal than written or oral
complaints made to a supervisor. The phrase "given information"
does no more than insure that even the provision of non-testimonial
information (such as incriminating documents) in an inquiry or pro-
ceeding would be covered. And, here as well as in Ball, the anti-
retaliation provision in section 510 is much narrower than the equiva-
lent anti-retaliation provisions in such statutes as Title VII of the Civil
Rights Act of 1964, indicating a "much more circumscribed" remedy.
Ball, 228 F.3d at 364.
King's complaint in state court alleged that she was terminated for
complaining to her supervisor, Fredericks, and several other Marriott
officers and attorneys about anticipated transfers of assets from Mar-
riott's medical plan. Nowhere in the complaint does there appear any
allegation that King had testified in any proceeding (legal, administra-
tive, or otherwise), or that she was about to testify. Nor is there any
allegation that she had given information in such a proceeding. At
best, King's complaint, and the evidence in the record, show only that
King filed internal complaints with some of her co-workers, her
supervisor, and some of Marriott's attorneys, filings which do not
bring her within the ambit of section 510. (Indeed, defendants' attor-
ney at oral argument conceded that section 510 did not apply to
King's allegations.)
Because none of King's actions are protected under section 510,
the only potentially relevant provision, ERISA does not provide a fed-
9
eral cause of action for King's allegations. Consequently, her state
wrongful discharge claim is not completely preempted, and removal
of her claim was inappropriate.3
Two other Circuits have ruled otherwise, but we find their reason-
ing to be unpersuasive. In Anderson v. Electronic Data Systems
Corp., 11 F.3d 1311, 1315 (5th Cir. 1994), in reaching its contrary
decision, the Fifth Circuit merely recited section 510 without even
addressing the facial inapplicability of section 510 to intra-office
complaints. In Hashimoto v. Bank of Hawaii, 999 F.2d 408 (9th Cir.
1993), the Ninth Circuit at least recognized the evident inapplicability
of the statute's language to intra-office complaints, but concluded that
ERISA provides a remedy since the "statute [was] clearly meant to
protect whistle blowers" and could be "fairly construed to protect a
person in [plaintiff's] position if, in fact, she was fired because she
was protesting a violation of law in connection with an ERISA plan."
Id. at 411. We simply do not agree that the language of section 510
can be "fairly construed" to extend to such a circumstance. Nor do we
think that we would be free to reject the most compelling interpreta-
tion of the statutory language for a "fair" interpretation, even if we
preferred as a matter of policy the result yielded by the broader interpre-
tation.4
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3 We need not and do not rule on the question of whether King's state
wrongful discharge claim is preempted under section 514 of ERISA, 29
U.S.C. § 1144. Since it could very well be that King' claim is preempted
(just not completely preempted), defendants' fear that "one could do an
end run around ERISA's broad preemption provision by asserting a state
law claim that directly implicates ERISA, but is not actionable under
ERISA" is misguided. Appellees' Brief at 46.
4 The court's policy preference appeared to drive the interpretive analy-
sis in Hashimoto. As it explained its thinking,
[t]he normal first step in giving information or testifying in any
way that might tempt an employer to discharge one would be to
present the problem first to the responsible managers of the
ERISA plan. If one is then discharged for raising the problem,
the process of giving information or testifying is interrupted at
its start: the anticipatory discharge discourages the whistle
blower before the whistle is blown.
Hashimoto, 999 F.2d at 411.
10
CONCLUSION
The judgment on the state wrongful discharge claims is vacated,
and the case is remanded for further proceedings not inconsistent with
this opinion.
VACATED AND REMANDED
11