Constant Readers,
If you are familiar with the Golden Gate Restaurant Association v. City and County of San Francisco case and/or are a lawyer, you can skip this post. I am writing this one because the facts and legal concepts of the case are not intuitive and people like my Mom (who thinks ERISA is what you get when you ride a bike for too long) might need some more background.
Basics of the Case:
The case of GGRA v. SF was filed on November 8, 2006 in the U.S. District Court for the Northern District of California. The suit alleges that the City and County of San Francisco violated federal law (which is why it was filed in federal court) by adopting the Health Care Security Ordinance (HCSO).
In April of 2007, the San Francisco Labor Council, Local 1021, Local 2 and the United Healthcare Care Worker’s West (collectively "the Union") claimed to have a special interest in the case and got the Judge to grant it "intervenor" status. Which just means that the Union can file papers and participate in the legal process but it is neither the Plaintiff nor Defendant. In its papers, the Union sided with the City and argued that the HCSO is perfectly lawful, thankyouverymuch.
Was there a trial?:
Nope. In cases like this one, where the question is only a difference in legal interpretation and there are no facts in dispute (i.e. the City doesn't deny passing the law at issue) the parties can file for what is called "summary judgment." In this case, both parties filed summary judgment motions. This just means that each party wrote long, boring documents setting forth their arguments. (See the bottom of this post.) The Judge then based his decision on those papers, a short oral argument that took place on November 2, 2007, and his Chinese horoscope. He's a Rooster. Hardworking, moody, loner.
What is the GGRA trying to do?:
The point of the GGRA's lawsuit is to invalidate the employer contribution parts of the HCSO (Secs. 14.3 and 14.4) - the lawsuit does not seek to invalidate the Health Access Plan (HAP, aka "Healthy San Francisco"). Because the GGRA won the case, Sections 14.3 and 14.4 of the HCSO are unenforceable. The HAP can still move forward, and Mistermayor says it will, only without the $30 million or so that would have come from employer contributions. Without employer contributions, instead of providing coverage for all uninsured San Franciscans, HAP Program Director Tangerine Brigham (has there ever been a better name?) says that the plan will be limited to people making 300% of the federal poverty level (about $30,630 for a single person) or less.
What is "preemption"?:
When the federal government passes a law on a subject and it wants that law to be the only one out there, it is said to "preempt" the field on that issue. In other words, no pesky state or local laws can be enforced that would conflict with federal laws and decisions in that area. Common examples of federal territory are foreign policy and immigration. (Though San Francisco has never given a rat's ass about federal authority in either of those areas!)
And so it is with employer-provided benefits. The Employee Retirement Income Security Act of 1974 (ERISA) was passed because employers were acting sketchy with regard to employee benefits. ERISA covers any employer "plan, fund, or program"...[which is] maintained for the purpose of providing for its participants or their beneficiaries...medical, surgical, or hospital care or benefits..." 29 USC Sec. 1002(1). ERISA regulates these medical plans with rules that do things like require plan descriptions be given to employees and prohibit discrimination in plan availability among employees.
So, when ERISA was being considered in Congress, employers were all, "Dude. How are we supposed to screw over our employees once we have all these new rules? Aw, man. Ok. Ok. We'll let you make these rules if you promise that they are the only rules we have to deal with. No state or local bullshit on top of all this. We don't need more rules and we definitely don't need more paperwork." (I totally saw this in the Congressional Record somewhere...)
And, soooooo....ERISA was passed with a seriously broad preemption clause; it states that ERISA "shall supersede any and all State laws insofar as they may now or hereafter relate to any employee benefit plan." 29 USC Sec. 1144(a).
Wrapping it up:
So hopefully now you can see what the GGRA v. SF case is about: the GGRA is saying that the HCSO employer contribution requirement "relates to" ERISA-covered health benefits and is therefore preempted.
The GGRA generally makes three arguments about the HCSO: (1) that it forces employers to create and maintain a specific level of ERISA benefits, (2) that it requires employers to set up a separate system for SF, which defeats the uniformity promised by ERISA, and (3) that it requires an examination of employee benefits in order to determine compliance and liability (which is an impermissible reference to ERISA plans).
The City argues that (1) the employers can just pay into the HAP, which is a perfectly good alternative that does not require setting up an ERISA benefit plan, (2) the administrative requirements are minimal, and (3) employee benefits must only be examined if the employer chooses to offer health insurance as opposed to paying into the HAP program.
Constant Readers, you are ready to discuss. Remember me when you are boring people at your New Year's Eve party!
--Melissa
And, since I had to grossly oversimplify the parties' arguments here, I am including the actual summary judgment filings so you all can read the arguments for yourselves. Now that you are experts, it should be a breeze!
Motion #1
City of San Francisco's Motion for Summary Judgment
Union's Motion for Summary Judgment
GGRA's Response to the City's and Union's Motions for Summary Judgment
City of San Francisco's Reply to GGRA's Response
Union's Reply to GGRA's Response
Motion #2
GGRA's Motion for Summary Judgment
City of San Francisco's Response to GGRA's Motion for Summary Judgment
Union's Response to GGRA's Motion for Summary Judgment
GGRA's Reply to the City's and Union's Responses
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