Leeson v. Transamerica Disability Income Plan

Whether a litigant is a participant for purposes of Employment Retirement Income Security (“ERISA”) is a substantive element of their claim, not a prerequisite for subject matter jurisdiction.  After separating from an employer Petitioner Jack Leeson (“Leeson”), a former employee of Respondent Transamerica Corporation, filed an action under ERISA to challenge the termination of his long-term disability benefits.  On remand, Transamerica filed a motion to dismiss Leeson’s action for lack of subject matter jurisdiction on the ground that Leeson did not have statutory standing as a plan participant to file suit under ERISA.  In this appeal, Leeson argued that the district court erroneously relied on the court’s prior holding in Curtis v. Nevada Bonding Corp. Instead, Leeson argued that under a more recent decision that, under ERISA, a “dismissal for lack of statutory standing is properly viewed as a dismissal for failure to state a claim rather than a dismissal for lack of subject matter jurisdiction.”  Leeson therefore argued that because he alleged a colorable claim for benefits, the district court had subject matter jurisdiction to address the merits of his case on remand. The court agreed and noted that the Supreme Court has instructed, “when Congress does not rank a statutory limitation on coverage as jurisdictional, courts should treat the restriction as non-jurisdictional in character.”

See Leeson v. Transamerica Disability Income Plan, 671 F.3d 969 (2012); see also 29 U.S.C. § 1101, et seq; 29 U.S.C. § 502(c); Curtis v. Nevada Bonding Corp., 53 F.3d 1023, 1027 (9th Cir. 1995) (holding that a district court lacked jurisdiction to consider an ERISA claim where a former employee “had neither a reasonable expectation of returning to covered employment nor a colorable claim to vested benefits”); Vaughn v. Bay Environmental Management, Inc., 567 F.3d 1021, 1024 (9th Cir. 2009); Arbaugh v. Y & H Corp., 546 U.S. 500, 516 (2006); Day v. AT&T Disability Income Plan, 685 F.3d 848, 856 (9th Cir. 2012); Bilyeu v. Morgan Stanley Long Term Disability Plan, 683 F.3d 1083, 1090 (9th Cir. 2012).

(Development authored by Theodore H. Waggner)