United States District Court, E.D. Michigan, Southern Division
Sean F. Cox, J.
AND RECOMMENDATION TO DENY PLAINTIFF'S MOTION FOR SUMMARY
JUDGMENT ;TO GRANT DEFENDANT'S MOTION FOR SUMMARY
JUDGMENT ; AND TO DISMISS THE COMPLAINT WITH PREJUDICE AS
TO ANY PURPORTED ERISA CLAIMS, BUT WITHOUT PREJUDICE AS TO
ANY OTHER CLAIMS
R. GRAND, United States Magistrate Judge
the outset of this litigation, neither the parties -
Plaintiff Wesley Lewis Ganson (“Ganson”) and
Defendant Detroit Public Schools (“DPS”) - nor
their respective attorneys, acted with an eye toward
“secur[ing] the just, speedy, and inexpensive
determination of [this] action.” Fed.R.Civ.P. 1. Ganson
filed a complaint that (1) misidentified the name of his own
retirement plan that is at the heart of this litigation and
(2) did not belong in this Court. DPS failed to move to
dismiss for lack of subject matter jurisdiction, choosing
instead to answer the complaint. Months later, when DPS
finally filed a motion for summary judgment on the grounds of
subject matter jurisdiction, it vaguely and baldly requested
a dismissal of Ganson's “complaint”
“with prejudice, ” even though “[d]ismissal
for lack of subject-matter jurisdiction should normally be
without prejudice, since by definition the court lacks power
to reach the merits of the case.” Revere v.
Wilmington Fin., 406 F. App'x 936, 937 (6th Cir.
2011) (citing Ernst v. Rising, 427 F.3d 351, 366
(6th Cir. 2005)).
not only failed to oppose DPS' motion, but also failed to
respond to the Court's ensuing Order to Show Cause.
Instead, after the Order to Show Cause deadline expired,
Ganson filed a Motion for Entry of an Order Dismissing the
Matter Without Prejudice that (intentional or not) had an air
of gamesmanship to it, and that motion was denied. Still,
when it later became clear that Ganson was not seeking to
game the process, DPS attempted to obtain more relief than it
was entitled to, necessitating this Report and
alleges that he worked for DPS from 1985 to 2009 and that
during his employment, he paid into a retirement plan held
with DPS. (Doc. #1 at ¶¶ 8, 9, 12). He now alleges
that DPS has breached its fiduciary duty under 29 U.S.C.
§ 1132(a)(3) by denying him his retirement benefits.
(Id. at ¶¶ 10, 20, 23, 32).
August 26, 2016, Ganson filed the instant complaint in this
Court under the Employee Retirement Income Security Act of
1974 (“ERISA”), 29 U.S.C. § 1001 et
seq., claiming that DPS breached fiduciary duties it
owed with respect to Ganson's retirement benefits. There
are at least three problems with Ganson's complaint.
First, Ganson inconsistently identified the plan in question
as the “Detroit Public Schools Retirement Plan, ”
the “Detroit Public Schools Retirement plan, ”
and the “Detroit Public Schools retirement plan.”
(Doc. #1 at ¶¶ 22, 23, 28, 32, 33). Second,
none of those names was correct; in DPS' summary
judgment motion, it asserts that no plan exists under the
name “Detroit Public Schools Retirement” plan,
and that instead, Ganson, “as a public employee, was
part of the Michigan Public Schools Retirement System
(MPSERS).” (Doc. #11 at 8). Ganson does not dispute
DPS' contentions. This leads to a third problem with
Ganson's ERISA complaint - it does not belong in this
U.S.C. § 1003(b)(1) of ERISA provides that it
“shall not apply to any employee benefit plan if . . .
such a plan is a governmental plan.” “The term
‘governmental plan' means a plan established or
maintained for its employees by the Government of the United
States, by the government of any State or political
subdivision thereof, or by any agency or instrumentality of
any of the foregoing.” 29 U.S.C. § 1002(32). The
MPSERS is clearly such a “governmental plan” not
subject to or governed by ERISA. See e.g., Kirby
v. Fitzgerald Pub. Sch. Dist., No. 16-13868, 2017 WL
3616492, at *3 (E.D. Mich. Aug. 23, 2017) (“Kirby
alleges that she is a member of the Michigan Public Schools
Employee Retirement System, which is maintained by the State
of Michigan. As such, it is a governmental plan, and
ERISA's provisions do not apply to it.”);
Halttunen v. City of Livonia, No. 2:15-CV-11932,
2015 WL 13050010, at *2 (E.D. Mich. Nov. 12, 2015)
(“[C]ourts have found that ERISA does not apply to the
Dearborn Employees Retirement System, In re Dearborn
Emps. Retirement Sys., 213 Mich.App. 701, 707 (Mich. Ct.
App. 1995), and the Genesee County Employees' Retirement
System, Town v. Genesee County, No. 12-CV-15310,
2014 U.S. Dist. LEXIS 44265 at *26 (E.D. Mich. March 31,
2014). In other cases, parties have stipulated to the fact
that ERISA does not govern local or municipal employee
retirement systems, as they are governmental plans. See,
e.g., Balowski v. City of Pontiac, No.
11-cv-15119, 2010 U.S. Dist. LEXIS 131293 at *4-5 (E.D. Mich.
Sept. 14, 2012); Bd. of Trs. of the City of Birmingham
Emps.' Retirement Sys. v. Comerica Bank, 767
F.Supp.2d 793, 798 (E.D. Mich. 2011).”); Duncan v.
Muzyn, 833 F.3d 567, 571 (6th Cir. 2016) (“As the
system is a governmental pension plan, it is not governed by
[ERISA].”). Because ERISA does not apply to MPSERS,
this Court lacks subject matter jurisdiction to rule on the
merits of Ganson's claim and dismissal is appropriate.
Kirby, No. 16-13868, 2017 WL 3616492, at *3
(“[T]he Michigan Public Schools Employee Retirement
System  is maintained by the State of Michigan. As such, it
is a governmental plan, and ERISA's provisions do not
apply to it. The Court dismisses any ERISA claim.”);
Wells v. Aetna Life Ins. Co., No. 12-CV-10985, 2013
WL 692749, at *2 (E.D. Mich. Feb. 26, 2013);
Halttunen, 664 F. App'x at 511-12 (6th Cir.
2016) (“[T]he pension plan at issue established by the
City is a governmental plan as defined by ERISA, and because
ERISA does not apply to governmental plans, the court lacked
jurisdiction to hear the merits of Halttunen's
claim.”); see Fed. R. Civ. P. 12(h)(3).
also erred from its earliest involvement in this litigation.
As Ganson's employer for almost a quarter century, DPS
knew (or clearly should have known) that Ganson's
complaint had identified a non-existent retirement plan and
that he was in fact an employee participant in the MPSERS.
Indeed, in its summary judgment motion, DPS wrote, “as
a public school employee, [Ganson] was part of the Michigan
Public Schools Retirement System (MPSERS)  [which] was
established by the state.” (Doc. #11 at 8). DPS should
have known that the MPSERS was a “governmental
plan” which, as discussed above, is not subject to
ERISA. But, after DPS was served with process, it did not
file a motion to dismiss based on a lack of subject matter
jurisdiction. Instead, it filed an answer, and the litigation
months proved to be an insufficient period of time for DPS to
file its dispositive motion, so on July 17, 2017, the day
dispositive motions were due, it filed a motion asking for
more time so that its counsel could perform “additional
research that was not originally foreseen.” (Doc. #8 at
2). This motion, and a similar one filed by Ganson on the
same date (Doc. #9), were granted, and the dispositive motion
deadline was extended until August 18, 2017.
last day of the extended deadline, DPS filed a motion for
summary judgment arguing principally that the Court lacked
subject matter jurisdiction because the MPSERS was a
governmental plan. (Doc. #11). The entire section of DPS'
brief devoted to this issue was a mere seven sentences
long. (Id. at 7-8). Despite the fact
that “[d]ismissal for lack of subject-matter
jurisdiction should normally be without prejudice, since by
definition the court lacks power to reach the merits of the
case, ” Revere, 406 F. App'x at 937, DPS
concluded its subject matter jurisdiction argument by vaguely
and baldly asserting that Ganson's
“Complaint should be
dismissed with prejudice.”
(Id. at 8) (emphasis added).
also filed a motion for summary judgment. (Doc. #10). DPS
filed a response to Ganson's motion (Doc. #12), but
Ganson did not file a response to DPS' motion. An Order
of Reference was entered on September 12, 2017, referring the
parties' cross-motions for summary judgment to the
undersigned pursuant to 28 U.S.C. § 636(b)(1)(B). (Doc.
#13). Due to Ganson's failure to timely respond to
DPS' motion, the Court issued an Order to Show Cause
giving Ganson until October 27, 2017, to file a response to
DPS' motion or to explain, in writing, why the Court
should not recommend dismissal of his complaint due to his
failure to respond. (Doc. #15). The Court explicitly warned
Ganson that his “[f]ailure to timely or
adequately respond in writing to this Order to Show Cause, or
to timely file a response to [DPS'] motion, will result
in a recommendation that [DPS'] motion be granted and/or
that Ganson's action be dismissed under Fed.R.Civ.P.
41(b).” (Id. at 1-2) (emphasis in
original). Yet Ganson still did not file a response to
DPS' motion nor to the Court's Order to Show Cause.
on November 15, 2017, Ganson filed a Motion for Entry of
Order Dismissing the Matter Without Prejudice, where he coyly
indicated that he “no longer wishes to pursue the
matter in the Federal District Court”; mentioned the
prospect of pursuing the matter in another court; and stated
that “it would be mere speculation as to whether or not
[DPS'] dispositive motion would be granted.” (Doc.
#16 at 3). On December 5, 2017, the Honorable Sean F. Cox
denied Ganson's request for voluntary dismissal of the
case without prejudice, partly because Ganson's motion,
which “provides no good reason for his ...