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Delta Air Lines Inc. v. Kramarsky

September 25, 1980

DELTA AIR LINES, INC., ALLEGHENY AIRLINES, INC., NATIONAL AIRLINES, INC., PIEDMONT AVIATION, INC., BRANIFF AIRWAYS, INC., NORTH CENTRAL AIRLINES, INC., SOUTHERN AIRWAYS, INC., EASTERN AIR LINES, INC., NORTHWEST AIRLINES, INC., TRANS WORLD AIRLINES, INC., OZARK AIR LINES, INC., AMERICAN AIRLINES, INC., PAN AMERICAN WORLD AIRWAYS, INC., AND UNITED AIR LINES, INC., PLAINTIFF-APPELLEES-CROSS-APPELLANTS,
v.
WERNER H. KRAMARSKY, INDIVIDUALLY AND IN HIS CAPACITY AS COMMISSIONER OF THE NEW YORK STATE DIVISION OF HUMAN RIGHTS; ANN THACHER ANDERSON, INDIVIDUALLY AND IN HER CAPACITY AS GENERAL COUNSEL OF THE NEW YORK STATE DIVISION OF HUMAN RIGHTS; THE NEW YORK STATE DIVISION OF HUMAN RIGHTS, AN AGENCY OF THE EXECUTIVE DEPARTMENT OF THE STATE OF NEW YORK; ARTHUR COOPERMAN, INDIVIDUALLY AND IN HIS CAPACITY AS CHAIRMAN OF THE NEW YORK STATE WORKMEN'S COMPENSATION BOARD; AND THE NEW YORK STATE WORKMEN'S COMPENSATION BOARD, DEFENDANTS-APPELLANTS-CROSS-APPELLEES



On rehearing as to whether the panel's prior ruling in this case, reported at 650 F.2d 1287, that § 296 of the New York Human Rights Law ("HRL") was not preempted by the Employee Retirement Income Security Act ("ERISA"), 29 U.S.C. 1001-1381 (1976), should be reversed in light of the Supreme Court's decision in Alessi v. Raybestos-Manhattan, Inc ., 451 U.S. 504, 101 S. Ct. 1895, 68 L. Ed. 2d 402 (1981), held : HRL § 296 is preempted by ERISA. Judgment of the district court affirmed in part, vacated in part, and remanded.

Before Moore and Kearse, Circuit Judges, and Tenney, District Judge.*fn*

Author: Kearse

Our original opinion on this appeal, reported at 2 Cir., 650 F.2d 1287, held, inter alia, that § 514(a) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1144(a) (1976), did not preempt New York's Human Rights Law ("HRL"), N.Y.Exec.Law § 296 (McKinney 1972 & Supp.1980-1981), insofar as the HRL required employers who maintained employee disability benefit plans to provide benefits for disability due to pregnancy during the period from December 30, 1976, to April 29, 1979. We granted the rehearing petition of plaintiffs-appellees Delta Air Lines, Inc., et al. in order to reconsider that holding*fn1 in light of the Supreme Court's subsequent decision in Alessi v. Raybestos-Manhattan, Inc., 451 U.S. 504, 101 S. Ct. 1895, 68 L. Ed. 2d 402 (1981). At issue here is whether, and to what extent, Alessi affects the precedential weight to be accorded the Supreme Court's earlier dismissal, for want of a substantial federal question, of an appeal in Minnesota Mining & Manufacturing Co. v. Minnesota, 444 U.S. 1041, 100 S. Ct. 725, 62 L. Ed. 2d 726 (1980), dismissing appeal from 289 N.W.2d 396 (Minn.1979) (hereinafter "Minnesota "), the decision that compelled our conclusion that ERISA did not preempt the HRL. Believing that Alessi has effectively overruled Minnesota, we now vacate so much of our prior opinion as held that 514(a) of ERISA did not preempt § 296 of the HRL, and we affirm the judgment of the district court insofar as it enjoined enforcement of the HRL.

The Summary Dismissal in Minnesota

In Minnesota, the Minnesota Supreme Court had held that a Minnesota statute that required employers to treat pregnancy the same as other disabling conditions for purposes of disability benefit plans, was not preempted by ERISA. The state court's decision was appealed to the United States Supreme Court pursuant to 28 U.S.C. § 1257(2) (1976), requiring the Court to rule on the merits of the state court's judgment. The Supreme Court, declining to receive briefs or hear oral argument, dismissed the appeal for want of a substantial federal question, thus leaving the state court judgment intact. As discussed in our prior opinion, familiarity with which is assumed, Supreme Court dismissals for want of a substantial federal question "are judgments on the merits ... with respect to the "precise issues presented (to the Supreme Court) and necessarily decided' by it in disposing of the appeal." 650 F.2d at 1295 (quoting Mandel v. Bradley, 432 U.S. 173, 176, 97 S. Ct. 2238, 2240, 53 L. Ed. 2d 199 (1977) (per curiam)). In the absence of any further enlightenment by the Court, such judgments must be followed by the lower courts, e.g., Hicks v. Miranda, 422 U.S. 332, 344, 95 S. Ct. 2281, 2289, 45 L. Ed. 2d 223 (1975). Thus we were compelled to view the Supreme Court as having ruled in Minnesota that ERISA did not preempt the Minnesota statute. Since the New York HRL is virtually identical to the Minnesota statute, we concluded that under the rule of Minnesota ERISA did not preempt HRL § 296.

Nevertheless, summary decisions of the Supreme Court are binding on the lower courts only "until such time as the Court informs (them) that (they) are not." Hicks v. Miranda, supra, 422 U.S. at 345, 95 S. Ct. at 2289 (quoting Doe v. Hodgson, 478 F.2d 537, 539 (2d Cir.), cert. denied, 414 U.S. 1096, 94 S. Ct. 732, 38 L. Ed. 2d 555 (1973), application denied, 500 F.2d 1206 (2d Cir. 1974)). Such information obviously may come in the form of an express overruling of a prior summary decision, but it need not be so direct. As the Court has recognized, even absent an explicit statement that the decision has been overruled, departure from a summary precedent may be warranted on the basis of "doctrinal developments" in the Court's subsequent decisions. Hicks v. Miranda, supra, 422 U.S. at 344-45, 95 S. Ct. at 2289-90 (quoting Port Authority Bondholders Protective Committee v. Port of New York Authority, 387 F.2d 259, 263 n.3 (2d Cir. 1967)). See also Heaney v. Allen, 425 F.2d 869, 870-71 (2d Cir. 1970). Since in Alessi the Supreme Court did not state in terms that it was overruling Minnesota, nor, indeed, even mention Minnesota, the questions here are whether Alessi is a "doctrinal development" that invalidates Minnesota, and, if it is, whether it compels us to hold that the HRL was preempted. We answer both questions in the affirmative.

Alessi as a Doctrinal Development

We regard the teaching of Alessi as incompatible with Minnesota's ruling that ERISA does not preempt state statutes that regulate the nature of the benefits an employer must provide in his employee benefit plans. Alessi involved a different type of regulation, but the starting point for its analysis is that which must be used here, and the course and final resting place of its analysis is no less instructive here.

The employee benefit plans challenged by retired employees in Alessi integrated pension benefits with workers' compensation benefits; they provided that an employee's retirement benefits would be reduced by an amount equal to any workers' compensation awards for which the retiree was eligible. The statute at issue was the New Jersey workers' compensation law, which forbade such reductions with respect to retirement pension benefits but allowed them with respect to disability pension benefits. After district court rulings that the New Jersey statute invalidated the plans and was not superseded by ERISA, the Court of Appeals for the Third Circuit reversed, concluding that, since the purpose of the state statute was to impose an additional statutory requirement for pension plans, the statute was preempted by ERISA.

The Supreme Court, after plenary consideration, agreed with the appellate court that ERISA preempted the New Jersey statute. Recognizing that the preemption of state law by federal law is not lightly to be inferred, 101 S. Ct. at 1905, the Court found that in ERISA § 514(a) Congress had expressly stated its intention to preempt the field of pension plan regulation:

In this instance, we are assisted by an explicit congressional statement about the pre-emptive effect of its action. The same chapter of ERISA that defines the scope of federal protection of employee pension benefits provides that

"the provisions of this Subchapter ... shall supersede any and all state laws insofar as they may now or hereafter relate to any employee benefit plan described in section 1003(a) of this title and not exempt under 1003(b) of this title." (s 514(a)).

This provision demonstrates that Congress intended to depart from its previous legislation that "envisioned the exercise of state regulation over pension funds," Malone v. White Motor Corp., 435 U.S. 497, 512, 514, 98 S. Ct. 1185, 1194, 1195, 55 L. Ed. 2d 443 (1978) (plurality opinion), and ...


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