Delaware Business Litigation Report

District Court Finds Claims Don't Implicate ERISA, Remands to Superior Court

Gallagher v. E.I. Du Pont de Nemours & Co., C.A. No. 07-47-JJF (D. Del. June 19, 2007).

In this suit for breach of contract, specific performance, and wages under the Delaware Wage Payment and Collection Act, Plaintiff filed the action in Superior Court. Defendant subsequently filed Notice of Removal to the District Court, asserting that the state law claims were completely preempted by ERISA. The Court held that Plaintiff’s claims did not implicate ERISA, and no grounds existed for federal jurisdiction. Plaintiff’s Motion to Remand to Superior Court was therefore granted.

Plaintiff alleged that while an employee of Defendant he was induced to forego participation in Defendant’s retirement program in order to complete a project, after being informed that he would be compensated for doing so. Plaintiff alleged that upon project completion he received payment of roughly one-fifth what he would have received as a participant in the program, and filed an action in Superior Court. Defendant argued that ERISA preempted the state law claims because Plaintiff sought relief in the amount that would have been collected under the retirement plan. The Court, however, found that Plaintiff’s claims were not preempted by ERISA because they did not seek recovery of benefits due under the terms of the retirement plan, or rights to future benefits under the plan. Rather, the relief sought was based on Plaintiff’s work performance and not on eligibility to participate in the plan. The Court therefore held that federal jurisdiction was not warranted.

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