complaint states only state law claims. See Pacific Retirement Plans, Inc., 828 F. Supp. 760, 763 (N.D. Cal. 1993).
A. Is the CPA Plan an ERISA Plan?
Prior to determining whether Plaintiff's state law claims are preempted according to the two-prong test set forth above it is necessary to first determine whether the plan at issue is an ERISA plan. If the plan at issue is an employee benefit plan under ERISA, then plaintiffs' state claims are preempted as a matter of law. du Mortier v. Massachusetts General Life Ins. Co., 805 F. Supp. 816, 819 (C.D.Cal. 1992). See also Pilot Life Insurance Co. v. Dedeaux, 481 U.S. 41, 95 L. Ed. 2d 39, 107 S. Ct. 1549 (1987); Kanne v. Connecticut General Life Ins. Co., 867 F.2d 489, 494 (9th Cir. 1988), (as amended, 1989) (per curiam), cert. denied, 492 U.S. 906, 106 L. Ed. 2d 566, 109 S. Ct. 3216 (1989).
There are two ways in which the CPA Plan could be an ERISA Plan and thus trigger federal law preemption: (1) the CPA Plan itself could be an ERISA Plan; or (2) the CPA Plan could be part of a package of plans, some of which are ERISA Plans. See du Mortier, 805 F. Supp. at 819. The CPA Plan does not appear to constitute an ERISA plan nor does any party contend that it is an ERISA Plan. Therefore, for the CPA Plan to fall under ERISA coverage, it must be part of a package featuring plans which are ERISA covered.
In Shaw v. Delta Air Lines, Inc., 463 U.S. 85, 77 L. Ed. 2d 490, 103 S. Ct. 2890 (1983), the Supreme Court addressed the situation of multibenefit package plans which contain both ERISA and Non-ERISA plans. In Shaw, the Court found that a disability plan that was supplemental to a general ERISA plan could not qualify for the express statutory exemption from ERISA for plans created to comply with the federal Disability Law unless it was "separately administered" and "maintained solely to comply with the Disability Benefit Law." Id. at 107. The Shaw Court reasoned that to apply state regulations to one portion of a multibenefit plan, while subjecting other portions to federal regulations, would be inefficient and result in "administrative impracticality". Id. at 107-08. The Court thus held that only separately administered disability plans maintained solely to comply with the Disability Benefits Law are exempt from ERISA coverage under § 4(b)(3) of ERISA. The Court was clearly concerned with plans that are administered as a unit. du Mortier, 805 F. Supp. at 819.
In du Mortier, the Court referred to a multibenefit plan, comprised of both ERISA and Non-ERISA insurance plans, which is administered as a unit, as a Shaw Plan. Id. The Court indicated that a Shaw Plan falls under ERISA, and therefore ERISA's preemption powers. Id. In holding that the plan at issue was not a Shaw Plan, the Court found that the Plan was not administered as a single unit. Id. In reaching this decision the Court focused on the fact that the Non-ERISA plan in question was offered by an entirely different insurer than the general plan (which contained the ERISA components) and administered entirely separately. Id.
1. The Group Insurance Plan as an ERISA Component
Defendants claim that the Group Insurance Plan, one of three insurance plans which comprise a multibenefit Plan, is an ERISA Plan which acts to draw the other Non-ERISA components, including the CPA Plan, into the boundaries of ERISA and its federal preemption clause.
The existence of an ERISA plan is a question of fact, to be answered in light of all the surrounding facts and circumstances from the point of view of a reasonable person. Kanne, 867 F.2d at 492. To determine whether an insurance plan is an ERISA plan, a district court should consider 29 U.S.C. § 1002(1), which defines an employee welfare benefit plan, and 29 C.F.R. § 2510.3-1(j), which clarifies the meaning of "establishing and maintaining" such a plan. See The Meadows v. Employers Health Insurance, 826 F. Supp. 1225, 1227 (9th Cir. 1993); Harper v. American Chambers Life Ins. Co., 898 F.2d 1432, 1433 (9th Cir. 1990). 29 U.S.C. § 1002(1) defines an employee welfare benefit plan in part as:
any plan, fund or program which . . . is established or maintained by an employer . . . for the purpose of providing for its participants or their beneficiaries, through the purchase of insurance or otherwise, (A) medical, surgical, or hospital care or benefits, or benefits in the event of sickness, accident, disability, death or unemployment[.]