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Daie v. Intel Corp.

United States District Court, D. Arizona

August 10, 2016

ED DAIE, Plaintiff,
v.
INTEL CORPORATION, THE REED GROUP, LTD., CLAIM APPEAL FIDUCIARY SERVICES, INC., and DOES 1-50, Defendants.

          ORDER RE MOTION TO DISMISS AND MOTION TO TRANSFER VENUE

          WILLIAM ALSUP UNITED STATES DISTRICT JUDGE.

         INTRODUCTION

         In this action for intentional infliction of emotional distress arising out of the administration of a disability plan governed by the Employee Retirement Income Security Act of 1974, defendants move to dismiss on preemption grounds. Defendants alternatively move to dismiss for improper venue or to transfer the action to the District of Arizona. For the reasons stated below, defendants’ motion to transfer is Granted. The motion to dismiss will be for the District of Arizona to decide.

         STATEMENT

         Our plaintiff Ed Daie, a former employee of defendant Intel Corporation and a resident of Arizona, brings claims for intentional infliction of emotional distress arising out of the administration of the Intel Corporation Long Term Disability Plan (the “Plan”). Daie worked for Intel for twenty-seven years and worked the final seven years of his career working at home in Arizona as a server memory technology director. Daie applied for long-term benefits from the Plan after taking an unpaid leave of absence from his position.

         At all relevant times, Intel self-funded the Plan pursuant to the Employment Retirement Income Security Act of 1974. Intel delegated all claims administration and discretionary authority to The Reed Group, Ltd., and Claim Appeals Fiduciary Services, Inc. (so all agree there is no conflict of interest in the administration of Daie’s claims).

         Reed was and remains a Colorado corporation with its headquarters in Colorado. CAFS was and remains a Colorado corporation with its headquarters in Georgia. Neither Reed nor CAFS performed any claims administration in California. Their only contacts with California arguably relating to this action were their respective contractual relationships with the Plan, which had been formed in California, and their communications with Daie’s counsel (Onada Decl. ¶¶ 3-4; Zimon Decl. ¶¶ 2-4).

         The complaint alleges that throughout the process of determining Daie’s claim for long-term disability benefits under the Plan, Reed and CAFS, as claims administrators for the Plan, engaged in outrageous intentional conduct with the aim of forcing Daie to drop his claim for benefits. The alleged conduct included inter alia, accusing Daie of lying about his disability, intentionally misstating his physicians’ statements, and pressuring him to undergo medical examinations without considering their results. In this action, Daie asserts a claim for intentional infliction of emotional distress (Compl. ¶¶ 30-31, 32-38).

* * *

         The procedural history of Daie’s disputes relating to the Plan and the administration thereof is bizarre.

         In July 2015, Daie filed an action for intentional infliction of emotional distress in San Francisco Superior Court against our defendants as well as Aetna Life Insurance Company, which is not a party to this action. The defendants removed the action to federal court here in San Francisco, where it was assigned to the undersigned judge (Case No. 15-3813).

         Defendants contended that removal was proper because Daie’s claims were completely preempted by ERISA. Daie moved to remand the action, and defendants moved to dismiss the action for improper venue. Defendants also moved to transfer the action to the District of Arizona. In November 2015, an order held that ERISA did not completely preempt Daie’s claims, so defendants’ removal was improper. That order remanded Daie’s IIED action to state court.

         One week later, Daie filed an action in federal court in San Francisco for the recovery of benefits under ERISA, naming Intel, Reed, CAFS, and the Plan as defendants (Case No. 15-5255). The new action was related to Daie’s first IIED action and reassigned to the undersigned. Defendants again moved to transfer to the District of Arizona. On February 18, 2016, an order denied the motion to transfer, inasmuch as the case would be decided based on the administrative record, so a transfer would have wasted judicial resources.

         On February 22, 2016, the San Francisco Superior Court dismissed Daie’s IIED action for forum non conveniens, holding that “the balance of private and public interests tipp[ed] decidedly in favor of [Arizona]” (Dkt. No. 14-1). Notwithstanding the state court decision holding that his IIED claim belonged in Arizona, Daie commenced the instant action here in federal court in San Francisco in April 2016, asserting ...


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