Leeson v. Transamerica Disability

ERISA plan participant status under § 1132(a)(1)(B) is an element of a claim, not an issue of subject matter jurisdiction.

Jack Leeson was a former employee of Transmerica Corporation and filed an ERISA claim upon termination of his long-term disability (LTD) benefits that resulted from injuries in an automobile accident. The parties disputed whether Leeson was on unpaid leave at the time he applied for LTD benefits, an issue which would determine his eligibility. The district court found that Leeson “did not provide cognizable evidence that [he] was not on unpaid leave.” The district court held that Leeson lacked standing under ERISA’s plan participant definition and therefore the court did not have subject matter jurisdiction under Curtis v. Nevada Bonding Corp. (9th Circuit 1995). The United States Supreme Court ruling in Arbaugh v. Y & H Corp. (2006) clarified that Congress must explicitly “rank a statutory limitation on coverage as jurisdictional.” Arbaugh forbids “Drive-by jurisdictional rulings.” This ruling allows the 9th Circuit holding regarding subject matter jurisdiction in Vaughn v. Bay Environmental Managaement Inc. (2009) to control here, and negates the precedential effect of 9th Circuit cases holding to the contrary. Nothing in the statutory framework of ERISA explicitly confers jurisdictional status to the § 1132(a)(1)(B) definition of a plan participant. Therefore, Leeson asserted a colorable claim that should at least make it to the summary judgment stage because of Vaughn, Arbaugh and its progeny. VACATED and REMANDED.