Plaintiff seeks benefits under a group disability policy issued
by defendant Metropolitan Life Insurance Company ("Metropolitan")
to plaintiff's employer Sears, Roebuck and Co.*fn1 The
complaint, which alleges breach of contract, and violations of
Pennsylvania's bad faith statute, 42 Pa. Cons.Stat.Ann. § 8371,
and its Unfair Trade Practices and Consumer Protection Law,
Pa.Stat.Ann. tit. 73, § 201-1 et seq., was originally filed in
the Court of Common Pleas of Philadelphia County. Metropolitan
removed the action to this court on the ground that the claims
involved are preempted by the Employee Retirement Income Security
Act ("ERISA"), 29 U.S.C. § 1001 et seq.
Metropolitan now moves to dismiss this action under Rule
12(b)(6) of the Federal Rules of Civil Procedure. It contends
that plaintiff has no viable state law claims due to ERISA
preemption. It also asserts that leave to amend the complaint
properly to state an ERISA claim would be futile because the
action is time barred.
For purposes of ruling on this motion, we accept as true the
well-pleaded factual allegations in the complaint and draw any
reasonable inferences from them in plaintiff's favor. See Hishon
v. King & Spalding, 467 U.S. 69, 73, 104 S.Ct. 2229, 81 L.Ed.2d
59 (1984). We may consider documents not formally attached to the
complaint in deciding a Rule 12(b)(6) motion to dismiss when the
complaint relies upon those documents and authenticity is
unchallenged. See In re Burlington Coat Factory Sec. Litig.,
114 F.3d 1410, 1426 (3d Cir. 1997).
Plaintiff began receiving disability benefits on October 1,
1987, but, effective February 1, 1996, such benefits were
terminated. According to an October 15, 1997 letter plaintiff
received from Metropolitan and attached to her brief in
opposition to defendant's motion to dismiss, plaintiff appealed
the termination of benefits to Metropolitan on March 22, 1996. On
August 5, 1996, Metropolitan upheld its decision. In an October
6, 1997 letter, plaintiff requested Metropolitan to review her
claim and its 1996 decision and in support enclosed "medical
evidence." On October 15, Metropolitan rejected this latest
appeal as untimely. It further advised plaintiff, "No further
review or appeal of the denial will be considered." Plaintiff
commenced the instant action apparently by writ of summons in the
Court of Common Pleas in January, 2000. The complaint was not
filed until March 9, 2001.
Since plaintiff has sued as a beneficiary under a group policy
issued by her employer, her action is governed by ERISA. Thus,
her three state law claims are preempted. See Pilot Life Ins.
Co. v. Dedeaux, 481 U.S. 41, 48, 107 S.Ct. 1549, 95 L.Ed.2d 39
(1987). Under ERISA, however, there are two types of preemption,
express and complete, and
the distinction is significant here. ERISA's express preemption
provision, § 514(a), provides that ERISA "shall supersede any and
all State laws insofar as they may now or hereafter relate to any
employee benefit plan. . . ." 29 U.S.C. § 1144(a). "State-law
claims that are subject to express preemption are displaced and
thus subject to dismissal." In re U.S. Healthcare, Inc.,
193 F.3d 151, 160 (3d Cir. 1999), cert. denied, 530 U.S. 1242, 120
S.Ct. 2687, 147 L.Ed.2d 960 (2000). Both plaintiff's statutory
state law bad faith and consumer protection claims "relate to" an
employee benefit plan and are expressly preempted by § 514(a).
See Pilot Life, 481 U.S. at 48, 107 S.Ct. 1549; Norris v.
Continental Cas. Co., Civ. A. No. 00-1723, 2000 WL 877040
(E.D.Pa. June 28, 2000); Tutolo v. Independence Blue Cross,
Civ. A. No. 98-CV-5928, 1999 WL 274975 (E.D.Pa. May 5, 1999). We
will therefore dismiss Counts II and III of plaintiff's complaint
Plaintiff's breach of contract claim in Count I also "relates
to" an employee benefit plan, but because it falls "within the
scope of ERISA's civil-enforcement provisions," it is subject to
what is known as the complete preemption doctrine. U.S.
Healthcare, 193 F.3d at 161. Section 502(a)(1)(B) of ERISA
provides a cause of action for beneficiaries who seek to "recover
benefits due" or to "clarify . . . rights to future benefits
under the terms of the plan." 29 U.S.C. § 1132(a)(1)(B). State
law claims that fall within the scope of § 502 are removable to
federal court, whereas expressly preempted claims are not. Thus,
complete preemption "operates to confer original federal subject
matter jurisdiction notwithstanding the absence of a federal
cause of action on the face of the complaint." Id. at 160. In
other words, completely preempted claims are converted into
federal claims instead of being "displaced" like expressly
preempted claims. Our Court of Appeals has made clear that
"[c]laims that are completely preempted are `necessarily federal
in character,' and thus are converted into federal claims." Id.
Such claims are removable to this court.
What is not clear is whether a completely preempted claim
should be dismissed with leave to amend to state explicitly an
ERISA claim or whether it should simply be converted into an
ERISA claim. See Gould v. Great-West Life & Annuity Ins. Co.,
959 F. Supp. 214, 219 (D.N.J. 1997). Decisions in this district
have done both. For example, in Cecchanecchio v. Continental
Casualty Co., Civ. A. No. 00-4925, 2001 WL 43783 (E.D.Pa.
Jan.19, 2001), the court dismissed plaintiff's completely
preempted claims, but granted leave to file an amended complaint
bringing claims for relief under ERISA. On the other hand, in
Delong v. Teacher's Insurance and Annuity Association, Civ. A.
No. 99-1384, 2000 WL 426193 (E.D.Pa. Mar.29, 2000), the court
simply converted plaintiff's completely preempted claims into
federal claims under ERISA. Several circuit courts have endorsed
the latter approach. See Bartholet v. Reishauer A.G. (Zurich),
953 F.2d 1073, 1078 (7th Cir. 1992); Carland v. Metropolitan
Life Ins. Co., 935 F.2d 1114 (10th Cir. 1991).
Keeping in mind that we are to construe pleadings "so as to do
substantial justice," Fed.R.Civ.P. 8(f), we think the more
practical as well as the speedier and less expensive approach is
to convert plaintiff's claim into an ERISA claim. See Fed.
R.Civ.P. 1. It is obvious from the language of Count I that
plaintiff is seeking to recover benefits allegedly due under her
employer's disability plan. Further, as part of the relief
requested in Count I, she seeks a declaration that she is
continuing disability benefits. These allegations clearly state a
claim for relief under § 502 of ERISA even though there is no
specific reference to the statute. We will thus treat Count I of
plaintiff's complaint as setting forth an ERISA claim.
We now turn to the question whether plaintiff's ERISA claim is
barred by the limitations period contained in the insurance
The contract's "Proof of Loss" provision reads:
For periodic payment for a continuing disability,
written proof covering the occurrence, character, and
extent of loss must be given to [Metropolitan] at its
Home Office within 90 days after the end of each
period for which benefits are payable, or less
frequently if requested by [Metropolitan].
If it was not reasonably possible to give written
proof in the time required, [Metropolitan] may not
deny the claim for this reason if the proof is filed
as soon as reasonably possible. In all cases however,
the proof required must be given no later than one
year from the time specified unless you were legally
Under the heading "Legal Actions," the policy provides:
No actions at law or in equity may be brought to
recover under these provisions within 60 days after
Proof of Claim has been furnished or after 3 years
from the expiration of the time in which Proof of
Claim is required.
The contract itself nowhere defines the term "proof of claim"
and uses it only in the Legal Action section.