United States District Court, N.D. California
For Starla Rollins, on behalf of herself, individually, and on behalf of all others similarly situated, Plaintiff: Bruce Frank Rinaldi, LEAD ATTORNEY, Matthew Alexander Smith, Michelle C. Yau, Monya M Bunch, PRO HAC VICE, Cohen Milstein Sellers & Toll PLLC, Washington, DC; Juli E. Farris, LEAD ATTORNEY, Harry Williams, IV, Lynn Lincoln Sarko, Matthew M. Gerend, PRO HAC VICE, Havila C. Unrein, Keller Rohrback LLP, Seattle, WA; Christopher Graver, Ron Kilgard, PRO HAC VICE, Keller Rohrback L.L.P., Phoenix, AZ; Karen L Handorf, PRO HAC VICE, Cohen Milstein Sellers & Toll PLLC, Washington, DC.
For Dignity Health, A California Non-profit Corporation, Herbert J. Vallier, an individual, Members of the Dignity Health Retirement Committee, Members of the Dignity Health Retirement Plans Sub-Committee, Defendants: Barry Scott Landsberg, LEAD ATTORNEY, Colin Michael McGrath, Craig Steven Rutenberg, Harvey L. Rochman, Manatt Phelps & Phillips LLP, Los Angeles, CA; Charles M. Dyke, LEAD ATTORNEY, Trucker Huss, A Professional Corporation, San Francisco, CA; David S. Shapiro, PRO HAC VICE, Attorney at Law, Cambridge, MA; R. Bradford Huss, Sean T. Strauss, Trucker Huss, A Professional Corporation, San Francisco, CA.
For United States of America, Movant: Benjamin Leon Berwick, LEAD ATTORNEY, United States Department of Justice, Civil Division, Federal Programs Branch, Washington, DC.
ORDER GRANTING PLAINTIFF'S MOTION
FOR PARTIAL SUMMARY JUDGMENT AND DENYING DEFENDANT'S MOTION FOR PARTIAL SUMMARY
THELTON E. HENDERSON, United States District Judge.
This matter came before the Court on the parties' cross-motions for partial summary judgment on June 16, 2014. Having considered the parties' arguments and the papers submitted, the Court now GRANTS Plaintiff's motion and DENIES Defendant's motion for the reasons set forth below.
This case is about whether Defendant Dignity Health (" Dignity" ) should conform its benefits plan (the " Plan" ) to the Employee Retirement Income Security Act (" ERISA" ), 29 U.S.C. § § 1001 et seq., or whether the Plan is exempt from ERISA because it is a " church plan," as defined by the ERISA statute. Dignity previously moved to dismiss this suit, claiming that because it is an entity " controlled by or associated with a church," its Plan is a " church plan" within the definition of the ERISA statute, and is thereby exempt from ERISA's provisions. On December 12, 2013, this Court denied Dignity's motion, holding that under the ERISA statute, a plan must be " established by a church" to be considered a church plan, and Dignity had not argued that it could meet that definition. Rollins v. Dignity Health,
No. 13-CV-1450 TEH, 19 F.Supp.3d 909, 2013 WL 6512682, at *7 (N.D. Cal. Dec. 12, 2013).
Dignity moved for interlocutory appeal of that decision and included in a footnote to its reply brief that it was reserving argument that its Plan may have indeed been established by a church, and therefore the Plan may be exempt even under the Court's reading of the statute. Concluding that the dismissal order did not satisfy the requirements set out in 28 U.S.C. § 1292(b), the Court denied the interlocutory appeal motion. Rollins v. Dignity Health, No. 13-CV-1450 TEH, 2014 WL 1048637, at *2 (N.D. Cal. Mar. 17, 2014).
In the meantime, Plaintiff Starla Rollins (" Rollins" ) moved for partial summary judgment seeking declaratory relief that the Plan is not exempt, and injunctive relief directing Dignity to bring its Plan into compliance with ERISA, including its reporting, vesting and funding requirements. Docket No. 91 at 1. Dignity sought additional time to respond to the motion, claiming it needed to retain an expert and engage in more discovery. Docket No. 99. Seeking to proceed more systematically and avoid potentially needless discovery, the Court narrowed the scope of Rollins's motion to only the question of whether Dignity's Plan is exempt from ERISA (Rollins's declaratory relief claim). Docket No. 105.
Regarding her declaratory relief claim, Rollins argues that there is no genuine dispute of material fact that the Plan was established by Dignity's predecessor, Catholic Healthcare West (" CHW" ), that CHW was not a church, and that therefore the Plan is not an exempt church plan under the statute. Dignity opposes Rollins's motion and argues that there is a genuine dispute of material fact because at the time the Plan was established in 1989, CHW was controlled by various religious women's orders known as the " Sponsoring Congregations," which would be considered churches for purposes of the statute. Dignity argues that the Sponsoring Congregations established the Plan jointly with CHW, and alternatively that by way of the Sponsoring Congregations' control over CHW, the Sponsoring Congregations indirectly established the Plan. Therefore, Dignity claims, the Plan was " established by a church" for purposes of the ERISA statute and is an exempt church plan. Additionally, Dignity argues that it is entitled to partial summary judgment because Rollins's claim for declaratory relief is barred by the statute of limitations, and because the declaratory relief Rollins seeks would not be " equitable," given that that the Internal Revenue Service (" IRS" ) has consistently considered the Plan exempt.
Summary judgment is appropriate if " there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed.R.Civ.P. 56. Material facts are those that may affect the outcome of the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A dispute as to a material fact is " genuine" if there is sufficient evidence for a reasonable jury to return a verdict for the nonmoving party. Id. At the summary judgment stage, the court may not weigh the evidence and must view it in the light most favorable to the nonmoving party. Id. at 255.
A party seeking summary judgment bears the initial burden of informing the court of the basis for its motion, and of identifying those portions of the pleadings and discovery responses that demonstrate the absence of a genuine issue of material fact. Celotex ...