
USCA1 Opinion

	




                            United States Court of Appeals                                For the First Circuit                                 ____________________        No. 96-1696         CHARLENE TAGAN GOLAS, INDIVIDUALLY AND AS EXECUTRIX OF THE ESTATE OF                                   DONALD M. GOLAS,                                Plaintiff, Appellant,                                          v.                HOMEVIEW INC. AND PAUL REVERE LIFE INSURANCE COMPANY,                                Defendants, Appellees.                                 ____________________                     APPEAL FROM THE UNITED STATES DISTRICT COURT                          FOR THE DISTRICT OF MASSACHUSETTS                   [Hon. Nathaniel M. Gorton, U.S. District Judge]                                              ___________________                                 ____________________                                        Before                                Stahl, Circuit Judge,                                       _____________                            Bownes, Senior Circuit Judge,                                    ____________________                              and Lynch, Circuit Judge.                                         _____________                                 ____________________            John  J. Weltman, with  whom Lawson  & Weitzen  was on  brief, for            ________________             _________________        appellant.            Joan  O.  Vorster,  with  whom  Joseph  M.  Hamilton  and  Mirick,            _________________               ____________________       _______        O'Connell, DeMallie & Lougee were  on brief, for appellee Paul  Revere        ____________________________        Life Insurance Company.                                 ____________________                                   February 7, 1997                                 ____________________                      LYNCH, Circuit Judge.   This is an appeal  from the                      LYNCH, Circuit Judge.                             _____________            denial  of plaintiff's motion  to amend her  complaint to add            Ellen Kaplan, an insurance  broker, as a defendant in  a suit            arising out  of Paul Revere Life  Insurance Company's refusal            to  pay  disability  insurance benefits  to  plaintiff's late            husband when he was suffering from his final illness.  In her            motion  to  amend,  plaintiff  sought  to  add  a  new  party            defendant  on  a  state law  claim  in  an  action which  the            district  court  was  simultaneously dismissing  against  the            original defendants as  being preempted by  federal law.   We            review  the  denial  of the  motion  to  amend  for abuse  of            discretion and conclude that there is no such abuse under the            circumstances.   We  need not and  do not reach  the issue of            whether the state law misrepresentation claim is preempted by            the Employee Income Security Act of 1974, 29 U.S.C.   1001 et                                                                       __            seq. ("ERISA").            ____                      In  August  1992,  plaintiff's  husband  obtained a            disability  insurance policy  through his  employer, HomeView            Inc.   One month later he was  diagnosed with bone cancer and            sought  disability benefits.  His request was denied as being            related  to  a  preexisting  condition for  which  he  sought            treatment during the enrollment period.                      After  her husband's death,  plaintiff brought suit            in Massachusetts state court against Paul Revere and HomeView            based on state law misrepresentation theories.  The complaint                                         -2-                                          2            alleged  that  HomeView  supplied  its  employees,  including            Donald  Golas,  with a  pamphlet,  prepared  by Paul  Revere,            explaining  the  rules   governing  preexisting   conditions.            Plaintiff  contends that  this pamphlet  was misleading.   It            indicated that  an insured individual could obtain disability            benefits  as long  as  the disability  was  not caused  by  a            sickness that  required him  to consult  a doctor during  the            three  month enrollment  period.   Plaintiff claims  that, in            reliance  on this  statement,  her husband  visited a  doctor            during  the enrollment  period  for  administrative  purposes            only.  However, he was not diagnosed with bone cancer at that            time.   It was this  visit, plaintiff alleges,  that made him            ineligible  to  receive  benefits.   Plaintiff  argues  that,            absent the flawed information,  her husband would have waited            until  after the enrollment period ended  to visit the doctor            and therefore would have been eligible for benefits.                      Plaintiff  sought damages  in  state court  for her            late  husband's emotional  distress and  for her own  loss of            consortium.  Plaintiff simultaneously brought suit in federal            court against the same  two defendants for benefits allegedly            due  under the  disability policy  pursuant to  ERISA.   That            ERISA  case  continues  to  be  pending  in  the  District of            Massachusetts.   Defendants  removed  the state  law suit  to            federal court,  arguing that those claims  were also governed            by ERISA.  The two cases were not consolidated.                                         -3-                                          3                      Once in federal court, Paul Revere moved to dismiss            the state  law claims,  arguing that they  were preempted  by            ERISA.1   Plaintiff countered by moving for a remand to state            court.  While these motions were pending, plaintiff moved  to            amend the complaint  to add Kaplan as  a defendant, asserting            that, since  filing her  initial action, she  had "discovered            that  critical  misrepresentations  upon  which  her  husband            relied  were made  to him  by Ellen  Kaplan."   The complaint            alleged that, "[p]rior to accepting disability  coverage, Mr.            Golas  spoke to Ellen Kaplan who made false statements to him            regarding  his  coverage under  the  disability policy,"  and            that,  "[a]s   the  broker  responsible  for  overseeing  the            provision  of  disability  insurance   from  Paul  Revere  to            HomeView  employees, Ms. Kaplan owed Mr. Golas a duty to make            sure she did nothing to interfere with his obtaining coverage            under the policy."                      Defendants opposed  the motion  to add Kaplan  as a            defendant, arguing that amendment would be futile because the            claim  against  Kaplan  would  also be  preempted  by  ERISA.            Plaintiff argued  that a  claim against Kaplan  would not  be            preempted  by  ERISA  because  Kaplan was  not  an  agent  of            HomeView or Paul Revere, but an independent insurance broker.                                            ____________________            1.  HomeView made its own motion to dismiss some three months            later, incorporating by reference Paul Revere's arguments  in            support.                                         -4-                                          4                      The   district   court  adopted   the  magistrate's            recommendation to grant  the motion to dismiss the  state law            claims  against  HomeView  and  Paul Revere  based  on  ERISA            preemption.    The district court went on to consider whether            to adopt  the magistrate's recommendation to deny plaintiff's            motion to amend the  complaint to add Kaplan as  a defendant.            Having  already decided  to dismiss  the claims  against Paul            Revere  and HomeView, the  district court  was faced  with an            anomalous situation.   Plaintiff wished to add a defendant to            a  case  which was  being dismissed  as  to the  two original            defendants.  In  addition, the ERISA cause of  action against            Paul Revere and HomeView was pending in the same court but in            a different  action from the one in which the motion to amend            was filed.   The district court's ultimate  decision to adopt            the magistrate's  recommendation to deny the  motion to amend            the complaint must be viewed in this practical and procedural            context.                      Golas appeals only from the denial of the motion to            amend the complaint to add Kaplan as a defendant and not from            the dismissal of the underlying action on preemption grounds.            Review is for abuse of discretion.  Reid v. New Hampshire, 56                                                ____    _____________            F.3d 332, 342 (1st Cir. 1995);  see also Carlo v. Reed Rolled                                            ________ _____    ___________            Thread Die Co., 49 F.3d 790, 792 (1st Cir. 1995) (noting that            ______________            the appeals court will "generally defer to a district court's            decision  to deny leave to amend where the reason is apparent                                         -5-                                          5            or   declared"   (internal  quotation   marks   and  citation            omitted)).   It  is well-settled,  as the  concurring opinion            from  our  respected  colleague  points  out,  that,  when  a            district court makes an error of law, by definition it abuses            its discretion.  However, that is not the issue that concerns            us here.  The facts and circumstances of the case necessarily            influence our evaluation of the denial of the motion to amend            the  complaint, and here,  they make it  unnecessary to reach            the ERISA preemption issue.                      We note that at the time the motion was denied, the            two original defendants  had been dismissed and there  was no            diversity jurisdiction over Kaplan.2  Furthermore, a parallel            ERISA action was pending against HomeView and Paul Revere  in                                            ____________________            2.  The  concurrence  argues that  the  ERISA  issue must  be            reached  because  issues of  jurisdiction  must be  addressed            first and, in  the absence  of diversity, there  is no  other            basis  for  federal jurisdiction.    This is  incorrect.   We            disagree with  the premise that  the court could  not address            the motion to amend without first addressing the ERISA issue.            Second, even  if the claim against Kaplan  were not preempted            by  ERISA,   the  district  court  would   have  supplemental            jurisdiction over the claim, because  the other two state law            claims had properly been  before the district court.   In any            civil  action over  which the  district courts  have original            jurisdiction,  they also have  supplemental jurisdiction over            all  other  claims  that  form  part  of  the  same  case  or            controversy.    28 U.S.C.    1367.    The district  court had            jurisdiction over  the state  law claims against  Paul Revere            and   HomeView  under   the  complete   preemption  doctrine.            Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 65 (1987).            __________________________    ______            This  is sufficient  to confer  original jurisdiction  on the            district courts.  Franchise  Tax Bd. v. Construction Laborers                              __________________    _____________________            Vacation   Trust,  463   U.S.  1,   23-24  (1983);   American            ________________                                     ________            Policyholders Ins. Co. v. Nyacol Prods., Inc., 989 F.2d 1256,            ______________________    ___________________            1263 (1st Cir. 1993).                                         -6-                                          6            federal court.   Federal courts have  traditionally been more            reluctant to exercise jurisdiction over pendent  parties than            over pendent claims.  See, e.g., Lykins v. Pointer, Inc., 725                                  ___  ____  ______    _____________            F.2d 645, 649 (11th Cir. 1984).3  Under these  circumstances,            the district court could not  have abused its discretion when            it denied  plaintiff's motion to  amend the complaint  to add            Kaplan  as the sole  defendant.  Even  if our review  were de                                                                       __            novo,  as the concurrence  suggests, we  could affirm  on any            ____            legal  ground supported in the  record.  See,  e.g., Eagan v.                                                     ___   ____  _____            United  States, 80 F.3d 13, 16 (1st Cir. 1996); Levy v. FDIC,            ______________                                  ____    ____            7 F.3d 1054, 1056 (1st Cir. 1993).                      We  therefore uphold  the denial  of the  motion to            amend, albeit on  different grounds than  those relied on  by            the district court,  and thus  we express no  opinion on  the            preemption issue.  This opinion does not, as  the concurrence            claims,  uphold the district  court's preemption decision sub                                                                      ___            silentio.  Plaintiff may decide to attempt to add Kaplan as a            ________            defendant in the pending ERISA action.4  The district court's                                            ____________________            3.  The   codification   of  the   supplemental  jurisdiction            doctrine in  1990, which  makes clear that  such jurisdiction            includes  the  joinder of  additional  parties,  28 U.S.C.               1367(a), does not change the prudential analysis.            4.  It is true that the three-year statute of limitations for            a state law based fraudulent misrepresentation claim expired,            at the  very latest, in early  1996.  However, to  the extent            that  plaintiff has  a viable  state law  claim (on  which we            express  no opinion),  the  claim could  apparently still  be            brought,  within a year of the date of this opinion, pursuant            to Mass. Gen. Laws ch. 260,   32.                                         -7-                                          7            ruling  that  any claim  against  Kaplan  would be  preempted            presents  no bar.  It has no precedential or issue preclusive            effect.   If  a motion  is made  to add  Kaplan to  the ERISA            action,  the  court will  have  the ability  to  consider the            preemption  issue anew in light  of the facts  that have been            developed in discovery.   Cf. Boston Children's Heart Found.,                                      ___ _______________________________            Inc. v.  Nadal-Ginard, 73  F.3d 429,  439-40 (1st Cir.  1996)            ____     ____________            (absent precedent on closely related issue, the inquiry as to            whether  state law is preempted requires the court to look at            the facts of the particular case).5                      The decision of the district court is affirmed.                                                            _________                                            ____________________            5.  At oral argument we were advised that there was discovery            taken on  the issue of whether Kaplan was an agent, either of            HomeView or of Paul Revere.  The  proffered amended complaint            is ambiguous on this  issue, although the concurrence assumes            that Kaplan was not an agent of either  company.  In Kaplan's            deposition  testimony attached to Golas' brief, Kaplan states            that  she  held an  employee  benefits  meeting for  HomeView            employees to explain the Paul Revere disability policy and an            Aetna  insurance  policy  that  was  also  being  offered  to            HomeView  employees.   This undermines  Golas' argument  that            Kaplan was  an independent broker.   The facts may  by now be            established, but  no  findings are  before us.   However,  if            Kaplan  was  an agent  of either  of  the two  companies, the            factual assumption  underlying the concurrence  is incorrect,            and the resulting legal  conclusions unjustified.  Indeed, if            Kaplan  is an agent of HomeView, the case would fall squarely            within  the ambit of Vartanian  v. Monsanto Co.,  14 F.3d 697                                 _________     ____________            (1st Cir. 1994).                                         -8-                                          8                      BOWNES, Senior Circuit Judge, concurring.  I concur                      BOWNES, Senior Circuit Judge, concurring.                              ____________________            in the  result, but, with respect,  I do not  think that this            case  can be disposed of by the conclusory assertion that the            district  court  did  not  abuse its  discretion  in  denying            plaintiff's  motion to amend her complaint so as to add Ellen            Kaplan as  a defendant.   In his  report and  recommendation,            adopted by  the district  court, the magistrate  judge stated            the following  reason  for denying  the motion  to amend  the            complaint:                      I  find that Plaintiff['s] attempt to add                      Ellen Kaplan as a  party defendant and to                      assert   against   her   a    claim   for                      misrepresentation would be futile because                      such  a  claim  would  be  pre-empted  by                      ERISA.                      It is clear that the district court's denial of the            motion was not an  exercise of discretion, but  was compelled            by  its legal ruling that  the claim against  Kaplan would be            pre-empted  by  ERISA.   Accordingly,  the  district  court's                                 .            denial of the  motion is  subject to review  de novo,  rather                                                         __ ____            than  for  abuse of  discretion.   See  Carlo v.  Reed Rolled                                               ___  _____________________            Thread  Die Co.,  49  F.3d 790,  793 (1st  Cir.  1995).   The            _______________            Supreme  Court has  stated  unequivocally that  "[a] district            court  by definition abuses  its discretion when  it makes an            error of law."  Koon v.  United States, 116 S. Ct. 2035, 2047                            ______________________            (1996) (citation omitted).                        To  be sure,  in  the ordinary  case, the  decision            whether to grant or deny  a motion to amend the complaint  is                                         -9-                                          9            discretionary  with  the  trial  court, and  so  is  normally            reviewed for abuse of  discretion; but the case before  us is            not ordinary  in this  respect.   Here it  is clear  that the            motion  was  denied   because  of  the   magistrate's  stated            conclusion that the claim against  Kaplan was pre-empted as a            matter  of  law,  and  his unstated  but  apparent  corollary            conclusion  that, as a result,  he was deprived of discretion            (by the doctrine of futility) to grant the motion.                        Thus,  the question  before us  is not  whether the            district court  abused its discretion  in denying plaintiff's            motion to amend the complaint, but whether the basis for this            ruling was legally  correct.  If the  district court's ruling            was erroneous,  as I think it  was, then the  motion to amend            was  not "futile"  and should  not have  been denied  on that            ground.     As  a  consequence,  the   district  court  lacks            jurisdiction  to   decide   the  merits   of  the   state-law            misrepresentation claim because, as the majority acknowledges            inferentially, the  only basis  for  federal jurisdiction  is            ERISA  pre-emption.   I  do not  think, therefore,  that this            appeal  can   be  decided  on  a   principled  basis  without            discussing the scope of ERISA pre-emption.                        The majority purports to "express no opinion on the            preemption issue,"  and  suggests that  the  plaintiff  could            still pursue her claim against Kaplan by seeking to amend her            pending ERISA complaint so  as to add Kaplan as  a defendant.                                         -10-                                          10            The majority fails to  recognize, however, that the practical            effect  of its  disposition  of the  case  is to  uphold  the            district  court's pre-emption  ruling  sub silentio,  and  to                                                   ___ ________            leave the plaintiff with no recourse in any forum.  A finding                                     __             ___            of  no pre-emption results in dismissal of the claim for lack            of federal jurisdiction and leaves the plaintiff free to seek            redress in state  court.  In contrast, the majority's refusal            to  address the  merits of  the district  court's pre-emption            ruling is not only  analytically unsound, it also leaves  the            plaintiff exactly  where she started --  with her state-court            action subject to removal  to federal court on the  ground of            pre-emption  and with  pre-emption as  a bar  to recourse  in            federal court.                             For the reasons that  follow, I conclude that ERISA            does not pre-empt plaintiff's misrepresentation claim against            Kaplan and  that, therefore,  the proper disposition  of this            case  would be to deny plaintiff's motion for lack of federal            jurisdiction  over the purported state-law claim, leaving the            plaintiff free to pursue the claim in the state court.6                                           I.                                          I.                      I  start my  analysis  with the  key  words of  the            statute bearing on pre-emption:                         Except as provided  in subsection  (b)                      of this section,  the provisions of  this                                            ____________________            6.  I, of course,  intimate no  opinion as to  the merits  of            plaintiff's state-law claim.                                         -11-                                          11                      subchapter  and  subchapter  III of  this                      chapter shall supersede any and all State                              _________________________________                      laws insofar as they may now or hereafter                      _________________________________________                      relate  to  any  employee   benefit  plan                      _________________________________________                      . . . .             29 U.S.C.   1144(a) (emphasis added).                      For purposes of this section:                           (1)    The  term   "State  law"                           includes  all laws,  decisions,                           rules,  regulations,  or  other                           State action  having the effect                           of law, of any State.            29 U.S.C.   1144(c)(1).                      The  Supreme  Court  teaches  that  the pre-emption            provision of   514(a),  codified at 29 U.S.C.    1144(a), was            intended                      to  ensure that  plans and  plan sponsors                      would  be subject  to a  uniform body  of                      benefits  law; the  goal was  to minimize                      the  administrative and  financial burden                      of complying  with conflicting directives                      among  States or  between States  and the                      Federal   Government.     Otherwise,  the                      inefficiencies created could work  to the                      detriment  of plan  beneficiaries. .  . .                      Particularly disruptive  is the potential                      for conflict  in substantive law.   It is                      foreseeable that state courts, exercising                      their  common  law powers,  might develop                      different      substantive      standards                      applicable to the same  employer conduct,                      requiring  the  tailoring  of  plans  and                      employer conduct to the  peculiarities of                      the law  of each  jurisdiction.   Such an                      outcome is fundamentally at odds with the                      goal of uniformity  that Congress  sought                      to implement.             Ingersoll-Rand  Co. v.  McClendon, 498  U.S. 133,  142 (1990)            _________________________________            (citations omitted).                                          -12-                                          12                      In  concluding  that plaintiff's  misrepresentation            claims were pre-empted, the  magistrate judge relied on Carlo                                                                    _____            v. Reed  Rolled Thread  Die Co.,  49 F.3d 790.   In  Carlo we            _______________________________                      _____            stated                                          -13-                                          13            the ERISA pre-emption doctrine as follows:                         Section 514 of  ERISA supersedes  "any                      and all  State laws  insofar as  they may                      now or  hereafter relate to  any employee                                        ______ __                      benefit plan. . . ."  29 U.S.C.   1144(a)                      (emphasis  added).  "The term 'State Law'                      includes  all   laws,  decisions,  rules,                      regulations, or other State action having                      the  effect of  law, of  any State."   29                      U.S.C.    1144(c)(1).  The  Supreme Court                      has established that "a law  'relates to'                      an employee benefit  plan . . . if it has                      a  connection with or reference to such a                      plan."  Ingersoll-Rand Co.  v. McClendon,                              ________________________________                      498 U.S.  133, 139, 111 S.  Ct. 478, 483,                      112 L. Ed. 2d 474 (1990) (quoting Shaw v.                                                        _______                      Delta Air  Lines, Inc., 463 U.S.  85, 96-                      ______________________                      97, 103 S. Ct.  2890, 2900, 77 L.  Ed. 2d                      490 (1983)).   "Under this 'broad common-                      sense  meaning,' a state  law may 'relate                      to' a benefit plan,  and thereby  be pre-                      empted,   even   if   the  law   is   not                      specifically  designed   to  affect  such                      plans, or the  effect is only  indirect."                      Id.  (quoting  Pilot  Life  Ins.  Co.  v.                      ___            __________________________                      Dedeaux,  481 U.S.  41,  47,  107 S.  Ct.                      _______                      1549, 1553, 95 L. Ed. 2d 39 (1987)).            Id. at 793 (footnote omitted).            ___                      Carlo, a leading case in this circuit on ERISA pre-                      _____            emption, see Degnan v. Publicker Indus., Inc., 83 F.3d 27, 29                     ___ ________________________________            (1st  Cir. 1996),  held that  ERISA pre-empted  the state-law            misrepresentation claims because they had "a  connection with            or reference to" an employee benefit plan.  Carlo, 49 F.3d at                                                        _____            794-95.  But  we have never held that Carlo sweeps all state-                                                  _____            law  misrepresentation claims  into the  ERISA  corner merely            because an employee benefit plan exists.                                         -14-                                          14                      In Boston Children's  Heart Found., Inc. v.  Nadal-                         ________________________________________________            Ginard, 73 F.3d 429  (1st Cir. 1996), we reviewed  ERISA pre-            ______            emption cases, including Carlo, and concluded:                                     _____                           State  laws  that   have  merely   a                      "tenuous,    remote,     or    peripheral                      connection with a  covered benefit  plan"                      may not be preempted by ERISA.   Rosario-                                                       ________                      Cordero v. Crowley  Towing & Transp. Co.,                      ________________________________________                      46  F.3d  [120,]  123  [1st   Cir.  1995]                      (citation  and  internal quotation  marks                      omitted).  Such is normally the case with                      respect to laws of general applicability.                      See  District  of  Columbia   v.  Greater                      ___  ____________________________________                      Washington  Board of  Trade, 506  U.S. at                      ___________________________                      130 n.1, 113 S.  Ct. at 583 n.1; Rosario-                                                       ________                      Cordero  v. Crowley Towing & Transp. Co.,                      ________________________________________                      46 F.3d  at 123;  Combined Mgt.,  Inc. v.                                        _______________________                      Superintendent    of   the    Bureau   of                      _________________________________________                      Insurance, 22 F.3d 1, 3 (1st Cir.), cert.                      _________                           _____                      denied,, ___  U.S. ___,  115 S. Ct.  350,                      _______                      130 L. Ed. 2d 306 (1994).  A court cannot                      conclude  that  a  state law  is  one  of                      general applicability, and as such is not                      preempted by ERISA, based  on the form or                      label of the law,  however.  See Carlo v.                                                   ___ ________                      Reed Rolled Thread  Die Co.,  49 F.3d  at                      ___________________________                      794 n.3;  Zuniga v.  Blue Cross and  Blue                                _______________________________                      Shield  of Michigan,  52 F.3d  1395, 1401                      ___________________                      (6th Cir.  1995).  Absent precedent  on a                      closely related problem, the inquiry into                      whether a state law "relates to" an ERISA                      plan  or is  merely "tenuous,  remote, or                      peripheral"  requires a court  to look at                      the facts  of [sic] particular case.  See                                                            ___                      Rosario-Cordero   v.  Crowley   Towing  &                      _________________________________________                      Transp. Co., 46 F.3d at 125 n.2.                      ___________            Boston Children's Heart Found., 73 F.3d at 439-40.            ______________________________                      In  Johnson v.  Watts Regulator  Co., 63  F.3d 1129                          ________________________________            (1st Cir.  1995), we  pointed out  the consequences  that may            flow from ERISA pre-emption:  It "may cause  potential state-            law remedies to vanish, or may change the standard of review,                                         -15-                                          15            or may affect the admissibility of evidence, or may determine            whether   a  jury  trial  is  available."    Id.  at  1131-32                                                         ___            (citations omitted).                      A  recent  Supreme  Court  decision  has  a  direct            bearing on the scope of ERISA pre-emption.  In New York State                                                           ______________            Conference of  Blue Cross &  Blue Shield  Plans v.  Travelers            _____________________________________________________________            Ins.  Co.,  115  S.   Ct.  1671  (1995),  several  commercial            _________            insurers,  acting  as   fiduciaries  of   ERISA  plans   they            administered, joined with their trade associations  and "[o]n            the   claimed   authority  of   ERISA's   general  preemption            provision"  brought  actions in  the  United States  District            Court against  state officials  to invalidate three  hospital            surcharge  statutes.  Id. at  1675.  Writing  for a unanimous                                  ___            Court, Justice  Souter made a  number of observations  on the            scope of ERISA pre-emption:                           Our past cases have  recognized that                      the Supremacy Clause,  U.S. Const.,  Art.                      VI,  may entail pre-emption  of state law                      either    by   express    provision,   by                      implication,  or  by  a conflict  between                      federal and state law.   And yet, despite                      the  variety  of these  opportunities for                      federal   preeminence,   we  have   never                      assumed   lightly   that   Congress   has                      derogated  state regulation,  but instead                      have addressed claims of pre-emption with                      the  starting  presumption that  Congress                      does  not intend  to supplant  state law.                      Indeed,  in cases  like  this one,  where                      federal  law is said  to bar state action                      in    fields    of   traditional    state                      regulation,   we   have  worked   on  the                      assumption   that  the   historic  police                      powers of  the  States  were  not  to  be                      superseded by the Federal Act unless that                                         -16-                                          16                      was  the  clear and  manifest  purpose of                      Congress.            Id. at 1676 (citations and internal quotation marks omitted).            ___            The Court commented on  the statutory pre-emption language of              514(a), "all state laws insofar as they . . . relate to any            employee benefit  plan," pointing out that  "[i]f 'relate to'            were   taken  to  extend  to  the  furthest  stretch  of  its            indeterminacy,  then for  all practical  purposes pre-emption            would never  run its  course."     Id. at  1677.   The  Court                                               ___            concluded:                      We  simply must  go beyond  the unhelpful                      text  and  the frustrating  difficulty of                      defining its key  term, and look  instead                      to the objectives of the ERISA statute as                      a  guide to  the scope  of the  state law                      that Congress understood would survive.            Id.            ___                      The Court, in the course of its analysis, stated:                           Indeed,  to   read  the  pre-emption                      provision  as  displacing all  state laws                      affecting costs and charges on the theory                      that  they  indirectly  relate  to  ERISA                      plans that purchase insurance policies or                      HMO  memberships  that  would cover  such                      services,  would   effectively  read  the                      limiting language in   514(a) out  of the                      statute, a conclusion that  would violate                      basic     principles     of     statutory                      interpretation and could  not be  squared                      with   our   prior   pronouncement   that                      [p]reemption does not occur  . . . if the                      state law  has only a tenuous, remote, or                      peripheral connection with covered plans,                      as is the case  with many laws of general                      applicability.                                         -17-                                          17            Id.  at  1679-80  (citation  and   internal  quotation  marks            ___            omitted) (alteration in original).                      In discussing  the sweep of  ERISA pre-emption  the            Travelers  Court pointed  to three  categories of  state laws            _________            that Congress  intended to pre-empt: first,  "state laws that            mandate[]    employee    benefit    structures    or    their            administration,"  id. at  1678; second, "state laws providing                              ___            alternate enforcement  mechanisms,"  id.; third,  state  laws                                                 ___            that  bind plan  administrators to  a "particular  choice and            thus function as a  regulation of an ERISA plan  itself," id.                                                                      ___            at  1679.  See  also Coyne &  Delaney Co. v.  Selman, 98 F.3d                       ___  ____ _______________________________            1457, 1468-69  (4th Cir. 1996).   It is obvious  that none of            these state-law categories are implicated here.                      The  Court   held  that  the  New   York  statutory            surcharges had  only "an indirect economic  effect on choices            made  by  insurance  buyers,  including  ERISA   plans"  and,            therefore, there was no pre-emption.  Travelers at 1679-80.                                                  _________                      Two  other  observations  about Travelers  must  be                                                      _________            made.   First, it was decided seven  weeks after Carlo.  This                                                       _____ _____            means,  of  course, that  the Carlo  panel  did not  have the                                          _____            benefit  of the  Court's latest  views on  ERISA pre-emption.            Second, none  of the ERISA pre-emption cases  decided in this            circuit subsequent to Travelers have cited it.                                  _________                      I  now turn  to  post-Travelers decisions  by other                                            _________            circuits.   In  a  case the  Fourth  Circuit described  as  a                                         -18-                                          18            "garden-variety  professional  malpractice  claim" the  court            held:                      In  light of  the Supreme  Court's recent                      (and  narrowing)  interpretation  of  the                      scope  of  ERISA preemption  in  New York                                                       ________                      State  Conference of  Blue  Cross &  Blue                      _________________________________________                      Shield Plans v. Travelers, ---  U.S. ---,                      _________________________                      115  S.  Ct.  1671,  131 L.  Ed.  2d  695                      (1995), we hold that Delany's malpractice                      claim  is not  preempted because  it does                      not  "relate to" an employee benefit plan                      within the meaning of  ERISA's preemption                      provision, 29 U.S.C.   1144(a).              Coyne  & Delany Co., 98  F.3d at 1466-67.   Quoting Travelers            ___________________                                 _________            for  the   proposition  that  courts   "'address  claims   of            preemption with the  starting presumption that  Congress does            not  intend  to  supplant  state   law,'"  98  F.3d  at  1467            (citations  omitted), the  Fourth Circuit  added, "[t]his  is            especially  true in  cases  involving  fields of  traditional            state regulation, including  common law tort liability,"  id.                                                                      __            In  the course of its  opinion the Fourth  Circuit noted that            plaintiff's  malpractice  claim  was  "not aimed  at  a  plan            administrator  at all  since  the defendants  [were] sued  in            their capacities as insurance professionals for actions taken            in that capacity."  Id.  at 1471.  This case is  analogous to                                ___            the one before us.                      Morstein v. National Ins. Servs., Inc., 93 F.3d 715                      ______________________________________            (11th  Cir. 1996)  (en banc),  cert. denied,  1996 WL  693349                                __ ____    _____ ______            (U.S.  Jan. 21,  1997)  (No. 96-764),  is  even more  closely            analogous  to  the case  at  bar.    Plaintiff  Morstein  was                                         -19-                                          19            president, director, and sole stockholder of a small company.            She met with an insurance broker for the purpose of obtaining            a replacement  policy of major medical  insurance for herself            and  the  company's other  employee.   The  policy was  to be            administered  by National  Insurance Services,  Inc.   At the            meeting  with the  broker,  plaintiff informed  him that  any            replacement policy would be  unacceptable if it excluded from            coverage   treatment  related  to   any  preexisting  medical            condition.   Plaintiff  alleged that  the broker  assured her            that the  replacement policy would provide  the same coverage            as  her existing policy.   Over a year  after the replacement            policy  was  issued,  plaintiff  had  total  hip  replacement            surgery.   National  Insurance  Services refused  to pay  her            claim for  payment on the ground  that the surgery was  for a            preexisting condition which  plaintiff had  not disclosed  on            her application.  93 F.3d at 716-17.                      Plaintiff filed  an action in  state court alleging            negligence,  malfeasance,  misrepresentations, and  breach of            contract.  Defendants  removed the case  to federal court  on            the basis of ERISA pre-emption.  Id. at 717.                                             ___                      In Morstein, the Eleventh Circuit, sitting en banc,                         ________                                __ ____            characterized the Supreme  Court's decision  in Travelers  as                                                            _________            having "essentially turned the tide  on the expansion of pre-            emption doctrine."   Id. at 721.  The holding of the Eleventh                                 ___            Circuit bears quoting:                                         -20-                                          20                           Allowing preemption of a fraud claim                      against  an  individual  insurance  agent                      will  not  serve  Congress's purpose  for                      ERISA.   As  we have  discussed, Congress                      enacted ERISA to protect the interests of                      employees  and   other  beneficiaries  of                      employee  benefit  plans.    To  immunize                      insurance agents  from personal liability                      for      fraudulent     misrepresentation                      regarding ERISA plans  would not  promote                      this  objective.    If ERISA  preempts  a                      beneficiary's  potential cause  of action                      for     misrepresentation,     employees,                      beneficiaries,  and   employers  choosing                      among various  plans  will no  longer  be                      able  to rely  on the  representations of                      the insurance agent  regarding the  terms                      of  the  plan.    These  employees,  whom                      Congress  sought  to  protect, will  find                      themselves   unable   to  make   informed                      choices regarding available benefit plans                      where state law places the duty on agents                      to deal honestly with applicants.            Id. at 723-24 (citation omitted).            ___                      In  Central States,  Southeast and  Southwest Areas                          _______________________________________________            Health and Welfare Fund  v. Pathology Lab. of Ark.,  P.A., 71            _________________________________________________________            F.3d 1251, 1253  (7th Cir.  1995), cert. denied,  116 S.  Ct.                                               _____ ______            1876 (1996), the Seventh Circuit, citing Travelers, held:                                                       _________                      Nothing   in   ERISA   prevents   medical                      professionals from  submitting--and state                      courts from enforcing--bills for services                      that are  not covered by  welfare benefit                      plans.  Although ERISA preempts state law                      that  "relates to"  plans,  29  U.S.C.                         1144(a), that clause does not annul state                      laws   of   general  applicability   just                      because  they affect the price of medical                      care.                      In Boyle v. Anderson, 68 F.3d 1093 (8th Cir. 1995),                         _________________            cert.  denied, 116  S. Ct.  1266 (1996),  a case  involving a            _____  ______            challenge to  certain provisions  of a Minnesota  health care                                         -21-                                          21            reform statute  known as  MinnesotaCare, the court  relied on            Travelers  in holding  that there  was no  ERISA pre-emption,            _________            stating, "In  the context of  the MinnesotaCare  legislation,            Travelers and  the other precedents cited  in this litigation            _________            compel this court not to preempt a state's effort to serve as            a 'laboratory  of democracy' in  the realm  of health  care."            Id. at 1109.            ___                      The  Seventh  Circuit also  relied on  Travelers in                                                             _________            rejecting an  ERISA pre-emption claim in Safeco Life Ins. Co.                                                     ____________________            v. Musser, 65 F.3d 647 (7th Cir. 1995).  The case was brought            _________            by  a health insurer who challenged the fees assessed against            such  insurers  to  provide health  insurance  to individuals            whose  physical and  mental  conditions  prevented them  from            obtaining  insurance in  the private  market.   In a  similar            case, the  Second Circuit, relying on  Travelers, inter alia,                                                   _________  _____ ____            held  that ERISA did not  pre-empt a Connecticut statute that            imposed surcharges on hospital bills of patients with private            health  insurance to  subsidize  medical care  for the  poor.            Connecticut  Hosp.  Ass'n v.  Weltman, 66  F.3d 413  (2d Cir.            _____________________________________            1995).   See  also Greenblatt  v.  Delta Plumbing  &  Heating                     ___  ____ __________________________________________            Corp.,  68  F.3d  561,  573-74 (2d  Cir.  1995)  (noting  the            _____            limiting gloss put on the broad language of   514(a) of ERISA            by Travelers).               _________                      As these cases  recognize, Travelers has restricted                                                 _________            the scope of ERISA pre-emption.                                         -22-                                          22                                         II.                                         II.                      I turn  now to what I consider to be the sole issue            before the panel:  whether the district court erred in ruling            that ERISA pre-emption  rendered "futile" plaintiff's  motion            to  amend her complaint to  add Ellen Kaplan  as a defendant.            The question of ERISA  pre-emption is reviewed de novo.   See                                                           __ ____    ___            Degnan  v. Publicker  Indus.,  Inc., 83  F.3d  at 28-29.    I            ___________________________________            recognize that the standard of review for  a district court's            refusal  to allow an amendment  to the complaint  is abuse of            discretion.   This standard is not  applicable here, however,            because the root issue -- stated by the district court as the            basis for its decision -- is ERISA pre-emption, a question of            law.  See  Carlo v. Reed  Rolled Thread Die  Co., 49 F.3d  at                  ___  _____________________________________            792-93.   Moreover, if there  is no pre-emption,  the federal            courts are bereft of  jurisdiction.  Thus, in my  view, there            is no way of avoiding the pre-emption issue.                      Normally in  a pre-emption case  the starting point            is an examination of the facts,  but there is not much in the            way  of  facts  here.   All  we  know  is  derived  from  the            allegations in the purported amended complaint, which must be            accepted  as true  at this  stage of  the litigation.   These            allegations can only be construed as stating that Kaplan made            misrepresentations  to  plaintiff's  husband,  Donald  Golas,            and/or  failed  to give  him  correct  information about  the            conditions of  eligibility for  participation  in the  Revere                                         -23-                                          23            Insurance policy.  The  amended complaint alleges that Kaplan            was an insurance broker.  I take that to mean that she "sold"            Revere's insurance  policy to  HomeView.  Although  Kaplan is            linked   to   HomeView  and   Revere   as   to  the   alleged            misrepresentations, there  is no  claim that Kaplan  acted as            agent for  or on behalf  of either or  both of the  other two            defendants.     The  amended  complaint,  broadly  construed,            alleges  a common-law misrepresentation  claim against Kaplan            individually.                      Strictly speaking, the  ERISA disability  insurance            plan  is  not  implicated  in  plaintiff's  misrepresentation            claim.    Donald  Golas  never  became  a  covered  employee;            instead,    the    complaint   focuses    on    the   alleged            misrepresentations which plaintiff alleges  were the cause of            Golas's being excluded from  insurance coverage.  Neither the            extent of insurance  coverage nor the  amount of benefits  is            involved.   Even the eligibility  requirements themselves are            not  in dispute;  it is  only the  alleged misrepresentations            about  those  eligibility  requirements  that  give  rise  to            plaintiff's  cause of  action.   Plaintiff's burden  of proof            thus  goes to whether her husband would have been eligible to            join the plan if Kaplan had not made misrepresentations as to            his eligibility.   See Coyne  & Delaney Co., 98  F.3d at 1462                               ___ ____________________            n.4.                                         -24-                                          24                      This case is markedly different from Carlo, 49 F.3d                                                           _____            790.   In  Carlo,  the plaintiff  was  a former  employee  of                       _____            defendant  Reed and  a  participant in  its retirement  plan.            Plaintiff  Carlo elected  early  retirement on  the basis  of            monthly  benefits he was told  he would receive.   The actual            monthly benefits  he received  were twenty percent  less than            the amount promised  him.  Defendant apologized for the error            and offered to let him continue working at the same position.            Carlo did  not accept  the offer  and  took early  retirement            under protest.  He subsequently brought suit in Massachusetts            state  court   for   breach   of   contract   and   negligent            misrepresentation.  Id. at 792.   We found ERISA pre-emption.                                ___                      In Carlo,  plaintiff had been a  participant in the                         _____            plan  and one  of  the  issues  was  the  amount  of  monthly            retirement pay  due him  under the substantive  provisions of            the plan.  Here, by contrast, Donald  Golas was not a covered            employee  and none  of the  issues implicate  the substantive            provisions of the insurance plan.  The allegations are solely            concerned    with   misrepresentations    regarding   Golas's            eligibility to become a covered employee.                      The analysis used in Boston Children's Heart Found.                                           ______________________________            v.  Nadal-Ginard  has  much  to  recommend  it.    In  Boston            ________________                                       ______            Children's Heart  Found., 73 F.3d  429, suit  was brought  in            ________________________            federal  district  court against  defendant,  who worked  for                                         -25-                                          25            plaintiff nonprofit corporation  as an officer and  director.            The suit  alleged that defendant breached  his fiduciary duty            by misappropriating plaintiff's funds.  The basis of the suit            was defendant's failure to disclose to the other directors of            the corporation important  information concerning  provisions            of a severance-benefit plan (the Banks Plan) he  had devised.            When the  plan was  terminated on defendant's  initiative, he            received  more than  $4,000,000  in severance  benefits.   On            appeal defendant  contended that ERISA  specifically exempted            the  type  of  severance  benefits  plan at  issue  from  its            fiduciary duty provisions  and pre-empted the  application of            state fiduciary law.  73 F.3d at 438.  We held:                      Here,  the  alleged  breach of  fiduciary                      duty relates to Nadal-Ginard's  action in                      establishing   the  Banks   Plan  without                      disclosing   information  that   a  self-                      interested fiduciary would be required to                      reveal  to his fellow  directors.  Nadal-                      Ginard's  misconduct preceded  the formal                      adoption   of  the   plan.     The  legal                      determination that Nadal-Ginard's conduct                      constitutes a fiduciary  breach does  not                      require  the  resolution  of any  dispute                      about      the     interpretation      or                      administration of the plan.  Further, the                                                   ____________                      application of state law in this instance                      _________________________________________                      does   not   raise   the   core   concern                      _________________________________________                      underlying ERISA preemption.  Indeed, the                      ___________________________                      fact  that  Nadal-Ginard  chose an  ERISA                      plan  rather  than  some  other  form  of                      compensation   is   peripheral   to   the                      underlying   claim    that   Nadal-Ginard                      breached his corporate responsibilities.                           This  being the  case, it  cannot be                      said  that  Massachusetts  fiduciary  law                      must be preempted in this instance.                                          -26-                                          26            Id. at 440 (emphasis added).             ___                      Based  upon our own  circuit cases, the restriction            of the scope  of pre-emption  under   514(a)  of the  statute            established in  Travelers, and  the  post-Travelers cases  in                            _________                 _________            other circuits,  it is evident  that ERISA does  not pre-empt            the misrepresentation claim against  Ellen Kaplan.  There are            eight  reasons,  gleaned  from  the  cited  cases,  for  this            conclusion.   (1) No ERISA  benefits are sought  and no ERISA            rights  or obligations  are asserted.   (2)  Defendant Kaplan            would be personally responsible for any money damages awarded            to plaintiff.   (3) Defendant Kaplan is not an  ERISA entity,            nor  does the  alleged  misrepresentation  claim  affect  the            relationship between  ERISA entities.  (4) None  of the three            categories  of  state  laws  that  Travelers  holds  Congress                                               _________            intended  to pre-empt  are  implicated.   (5) The  common-law            claim  of  misrepresentation  is   a  state  law  of  general            application.  Moreover, tort  law in general is traditionally            an area of state  regulation.  It is therefore  unlikely that            Congress intended  to intrude into this  area by pre-emption.            (6)  Congress  did  not  intend to  shield  tortfeasors  from            liability for misrepresentation where ERISA benefits, rights,            obligations, and core concerns are not implicated.  (7) State            common law imposes a duty of care relative to representations            made by  insurance professionals which  does not  in any  way            depend   upon  ERISA.    (8)  The  alleged  misrepresentation                                         -27-                                          27            occurred prior to  the time  when the ERISA  plan would  have            taken effect.                      I would  hold, therefore, that  the district  court            committed reversible error  in denying plaintiff's  motion to            amend on the ground  that the claim raised therein  "would be            pre-empted  by ERISA."7  Because ERISA  does not pre-empt the            claim asserted against  Ellen Kaplan, and because there is no            diversity of  citizenship between the parties,  nor any other            basis for  federal jurisdiction, the motion  should have been            denied for lack of federal jurisdiction.  Plaintiff should be            left to pursue her  misrepresentation claim against Kaplan in            the Massachusetts state courts.                        Although the  majority and I agree  on the ultimate            result, we disagree as to the proper path to take in reaching            it.   Because  I  think that  this  is a  case  in which  the            procedural path  is  important, I  must respectfully  concur,            rather than join the majority opinion.                                            ____________________            7.  I  would  also hold  that  the  district court  erred  in            adopting the magistrate's recommendation, without considering            the application of ERISA to Kaplan as an individual, in light            of  the differences  between her  status vis-a-vis  ERISA and            that of the other defendants.  Instead, the magistrate merely            said, "For the reason stated . . . [regarding Paul Revere and            HomeView] . . .," plaintiff's claim against Kaplan would also            "be pre-empted by ERISA."   He simply assumed that,  if ERISA            pre-empted  the claim  against Revere  and HomeView,  it must            likewise  pre-empt  the  claim  against Kaplan.    Given  the            distinctions between  Kaplan's status as an  ERISA entity and            that of  the other defendants,  this failure to  consider the            claim  against Kaplan on its own merit also constituted legal            error.                                         -28-                                          28
