Egelhoff v. Egelhoff
Encyclopedia
Egelhoff v. Egelhoff, 532 U.S. 141 (2001), is a major decision of the Supreme Court of the United States
on federalism
, specifically with regards to the preemption
powers of federal law over state laws. It sets the precedent that any state statutes having a "connection with" ERISA
plans are superseded by ERISA, or any future substantially similar law that takes its place. In essence, this decision is a reaffirmation of the right and ability of the federal government to, at least in some instances, pre-empt state laws.
resident David A. Egelhoff was married to Donna Rae Egelhoff, and during that time he designated her as the beneficiary of a life insurance
policy and pension
plan provided by his employer, Boeing Corporation. The life insurance policy & pension were governed by the Employee Retirement Income Security Act of 1974
(ERISA), a piece of federal legislation concerning pension and life insurance programs. David Egelhoff subsequently divorced his wife, but did not immediately remove her as a beneficiary. Weeks after the divorce had been finalized, David Egelhoff was killed in a car accident. David Egelhoff's children, from a previous marriage, filed suit against Donna Rae Egelhoff for the benefits (life insurance and pension
) from their deceased father. The case was considered under Washington state law wherein the designation of a spouse as beneficiary to "nonprobate asset," a life insurance policy or employee benefit plan, is revoked immediately upon the divorce of the designator and the beneficiary. However, under ERISA, this was not the case, and Donna Rae Egelhoff would be the beneficiary of her late ex-husband's benefits.
The trial court decided that ERISA pre-empted Washington state law, and granted Donna Rae Egelhoff the benefits she sought. The Washington Court of Appeals
reversed this decision, claiming that the federal law did not supersede state law. The Supreme Court of Washington affirmed this decision, citing that, because the Statute did not "refer to" or have a "connection with" an ERISA plan, the state law would be most appropriate. The Supreme Court granted certiorari
and heard the case.
disagreed with the decision of the Washington State Supreme Court, and instead ruled that this law did, in fact, have a "connection with" an ERISA plan, and was therefore pre-empted by the federal legislation. According to the decision, the criteria used to determine whether or not a state law has a connection with ERISA, "the Court looks both to ERISA’s objectives as a guide to the scope of the state law that Congress understood would survive, as well as to the nature of the state law’s effect on ERISA plans." Further, the Court believed it, "interfere[d] with nationally uniform plan administration." The Court reasoned that this sort of state law was precisely the sort of situation that ERISA sought to remedy in the first place, and ruled that if it were allowed it would effectively render much of ERISA unenforceable.
The opinion of the Court was 7 to 2, and was delivered by Justice Thomas
, who was joined by Chief Justice Rehnquist
and Justices O'Connor
, Scalia
, Kennedy
, and Souter
. Justice Scalia
filed a separate concurring opinion, which was joined by Justice Ginsburg
. Justice Breyer
filed a dissenting opinion, joined by Justice Stevens
.
Supreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
on federalism
Federalism
Federalism is a political concept in which a group of members are bound together by covenant with a governing representative head. The term "federalism" is also used to describe a system of the government in which sovereignty is constitutionally divided between a central governing authority and...
, specifically with regards to the preemption
Federal preemption
Federal preemption refers to the invalidation of US state law when it conflicts with Federal law.-Constitutional basis:According to the Supremacy Clause of the United States Constitution,...
powers of federal law over state laws. It sets the precedent that any state statutes having a "connection with" ERISA
Employee Retirement Income Security Act
The Employee Retirement Income Security Act of 1974 is an American federal statute that establishes minimum standards for pension plans in private industry and provides for extensive rules on the federal income tax effects of transactions associated with employee benefit plans...
plans are superseded by ERISA, or any future substantially similar law that takes its place. In essence, this decision is a reaffirmation of the right and ability of the federal government to, at least in some instances, pre-empt state laws.
Background
WashingtonWashington State
Washington State may refer to:* Washington , often referred to as "Washington state" to differentiate it from Washington, D.C., the capital of the United States* Washington State University, a land-grant college in that state- See also :...
resident David A. Egelhoff was married to Donna Rae Egelhoff, and during that time he designated her as the beneficiary of a life insurance
Life insurance
Life insurance is a contract between an insurance policy holder and an insurer, where the insurer promises to pay a designated beneficiary a sum of money upon the death of the insured person. Depending on the contract, other events such as terminal illness or critical illness may also trigger...
policy and pension
Pension
In general, a pension is an arrangement to provide people with an income when they are no longer earning a regular income from employment. Pensions should not be confused with severance pay; the former is paid in regular installments, while the latter is paid in one lump sum.The terms retirement...
plan provided by his employer, Boeing Corporation. The life insurance policy & pension were governed by the Employee Retirement Income Security Act of 1974
Employee Retirement Income Security Act
The Employee Retirement Income Security Act of 1974 is an American federal statute that establishes minimum standards for pension plans in private industry and provides for extensive rules on the federal income tax effects of transactions associated with employee benefit plans...
(ERISA), a piece of federal legislation concerning pension and life insurance programs. David Egelhoff subsequently divorced his wife, but did not immediately remove her as a beneficiary. Weeks after the divorce had been finalized, David Egelhoff was killed in a car accident. David Egelhoff's children, from a previous marriage, filed suit against Donna Rae Egelhoff for the benefits (life insurance and pension
Pension
In general, a pension is an arrangement to provide people with an income when they are no longer earning a regular income from employment. Pensions should not be confused with severance pay; the former is paid in regular installments, while the latter is paid in one lump sum.The terms retirement...
) from their deceased father. The case was considered under Washington state law wherein the designation of a spouse as beneficiary to "nonprobate asset," a life insurance policy or employee benefit plan, is revoked immediately upon the divorce of the designator and the beneficiary. However, under ERISA, this was not the case, and Donna Rae Egelhoff would be the beneficiary of her late ex-husband's benefits.
The trial court decided that ERISA pre-empted Washington state law, and granted Donna Rae Egelhoff the benefits she sought. The Washington Court of Appeals
Court of Appeals
A court of appeals is an appellate court generally.Court of Appeals may refer to:*Military Court of Appeals *Corte d'Assise d'Appello *Philippine Court of Appeals*High Court of Appeals of Turkey*United States courts of appeals...
reversed this decision, claiming that the federal law did not supersede state law. The Supreme Court of Washington affirmed this decision, citing that, because the Statute did not "refer to" or have a "connection with" an ERISA plan, the state law would be most appropriate. The Supreme Court granted certiorari
Certiorari
Certiorari is a type of writ seeking judicial review, recognized in U.S., Roman, English, Philippine, and other law. Certiorari is the present passive infinitive of the Latin certiorare...
and heard the case.
Decision
The Supreme CourtSupreme Court of the United States
The Supreme Court of the United States is the highest court in the United States. It has ultimate appellate jurisdiction over all state and federal courts, and original jurisdiction over a small range of cases...
disagreed with the decision of the Washington State Supreme Court, and instead ruled that this law did, in fact, have a "connection with" an ERISA plan, and was therefore pre-empted by the federal legislation. According to the decision, the criteria used to determine whether or not a state law has a connection with ERISA, "the Court looks both to ERISA’s objectives as a guide to the scope of the state law that Congress understood would survive, as well as to the nature of the state law’s effect on ERISA plans." Further, the Court believed it, "interfere[d] with nationally uniform plan administration." The Court reasoned that this sort of state law was precisely the sort of situation that ERISA sought to remedy in the first place, and ruled that if it were allowed it would effectively render much of ERISA unenforceable.
The opinion of the Court was 7 to 2, and was delivered by Justice Thomas
Clarence Thomas
Clarence Thomas is an Associate Justice of the Supreme Court of the United States. Succeeding Thurgood Marshall, Thomas is the second African American to serve on the Court....
, who was joined by Chief Justice Rehnquist
William Rehnquist
William Hubbs Rehnquist was an American lawyer, jurist, and political figure who served as an Associate Justice on the Supreme Court of the United States and later as the 16th Chief Justice of the United States...
and Justices O'Connor
Sandra Day O'Connor
Sandra Day O'Connor is an American jurist who was the first female member of the Supreme Court of the United States. She served as an Associate Justice from 1981 until her retirement from the Court in 2006. O'Connor was appointed by President Ronald Reagan in 1981...
, Scalia
Antonin Scalia
Antonin Gregory Scalia is an American jurist who serves as an Associate Justice of the Supreme Court of the United States. As the longest-serving justice on the Court, Scalia is the Senior Associate Justice...
, Kennedy
Anthony Kennedy
Anthony McLeod Kennedy is an Associate Justice of the United States Supreme Court, having been appointed by President Ronald Reagan in 1988. Since the retirement of Sandra Day O'Connor, Kennedy has often been the swing vote on many of the Court's politically charged 5–4 decisions...
, and Souter
David Souter
David Hackett Souter is a former Associate Justice of the Supreme Court of the United States. He served from 1990 until his retirement on June 29, 2009. Appointed by President George H. W. Bush to fill the seat vacated by William J...
. Justice Scalia
Antonin Scalia
Antonin Gregory Scalia is an American jurist who serves as an Associate Justice of the Supreme Court of the United States. As the longest-serving justice on the Court, Scalia is the Senior Associate Justice...
filed a separate concurring opinion, which was joined by Justice Ginsburg
Ruth Bader Ginsburg
Ruth Joan Bader Ginsburg is an Associate Justice of the Supreme Court of the United States. Ginsburg was appointed by President Bill Clinton and took the oath of office on August 10, 1993. She is the second female justice and the first Jewish female justice.She is generally viewed as belonging to...
. Justice Breyer
Stephen Breyer
Stephen Gerald Breyer is an Associate Justice of the U.S. Supreme Court. Appointed by President Bill Clinton in 1994, and known for his pragmatic approach to constitutional law, Breyer is generally associated with the more liberal side of the Court....
filed a dissenting opinion, joined by Justice Stevens
John Paul Stevens
John Paul Stevens served as an Associate Justice of the Supreme Court of the United States from December 19, 1975 until his retirement on June 29, 2010. At the time of his retirement, he was the oldest member of the Court and the third-longest serving justice in the Court's history...
.