Arjomand v. Metropolitan Life Insurance

Opinions of the United
2003 Decisions States Court of Appeals
for the Third Circuit

10-8-2003

Arjomand v. Metro Life Ins Co
Precedential or Non-Precedential: Non-Precedential

Docket No. 03-1081

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 NOT PRECEDENTIAL

UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

No. 03-1081

ABDOLLAH ARJOMAND; MARYAM A . SHARIF-EMAMI;
BAHMAN ARJOMAND; HEDAYAT BEHBEHANI;
BADRIEH BEHBEHANI,

Appellants

v.

METROPOLITAN LIFE INSURANCE CO.; M ETLIFE, INC.;
METROPOLITAN INSURANCE AND ANNUITY COMPANY;
LAWRENCE A. VRANKA; MEHDI FAKHARZADEH

____________

APPEAL FROM THE UNITED STATES DISTRICT COURT
FOR THE WESTERN DISTRICT OF PENNSYLVANIA
(Civ. No. 02-cv-00076 )
District Judge: Honorable Donetta W. Ambrose
____________

Submitted Under Third Circuit L.A.R. 34.1(a)
October 2, 2003
Before: RENDELL, WEIS, and GARTH, Circuit Judges.
(Filed October 8, 2003)
____________

OPINION

WEIS, Circuit Judge.

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 In 1986, plaintiffs purchased life insurance policies from Metropolitan Life

Insurance Company, a mutual organization. The company represented that, because of

earnings applicable to the policies, the premiums would “vanish” at the end of 10 years.

When those predications failed to materialize, plaintiffs complained to the Metropolitan

Life Insurance Company and, in 1997, the parties reached a settlement to “restructure” the

policies.

As a part of this agreement, plaintiffs received single premium policies

issued by the Metropolitan Insurance and Annuity Company, a stock company and an

affiliate of the Metropolitan Life Insurance Company. The cover page of the policies

bore the name of Metropolitan Insurance and Annuity Company, and stated that they did

not pay dividends.

Plaintiffs were also members of a class action brought against both

Metropolitan companies that covered the period from January 1, 1982 through December

31, 1997. The case was settled in August of 1999, and approved by the District Court in

December 1999.

Beginning in September 1999, Metropolitan Life Insurance Company began

the process of “de-mutualizing,” one result of which was the issuance to its policy holders

of stock in a new company, MetLife, Inc. Because they were not policyholders of

Metropolitan Life Insurance Company at that time, plaintiffs did not receive shares in

MetLife, Inc.

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 Plaintiffs filed suit in the Supreme Court of New York, seeking damages

because they had not been advised that the Metropolitan Insurance and Annuity policies

did not pay dividends and were issued by a non-mutual company. Plaintiffs alleged they

did not become aware of these facts until April 2000, when Metropolitan Life Insurance

Company completed de-mutualization.

Relying on the All Writs Act, defendants removed the case to the Western

District of Pennsylvania, which had approved the class action settlement and had retained

jurisdiction. In view of the then recently decided case of Syngenta Crop Protection, Inc.

v. Henson, 537 U.S. 28 (2002), the District Court concluded that the removal was

improvident. Because Metropolitan Life Insurance Company’s contentions could be

construed as a request for an injunction, the District Court decided to entertain the case on

that basis. In order to protect its judgment in the class action, the court enjoined the

plaintiffs from pursuing the state court litigation.

The District Court held that the alleged misrepresentation occurred in 1997,

within the duration of the class action period. Therefore, the claims were included within

the release, which covered omissions and non-disclosures involving the “replacement or

roll-over of an existing policy or annuity with or into a new policy or annuity.” Thus, the

plaintiffs’ claims arose in 1997, when the transition to the new policies occurred, rather

than in 2000, when the de-mutualization took place.

We agree with the District Court’s analysis of the dispute and the scope of

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the release. Accordingly, we conclude that the issuance of the injunction was a proper

remedy.

The District Court, in the exercise of its discretion, declined to award

plaintiffs the costs and fees associated with the removal of the case from the state court.

Because after the removal the Supreme Court issued its opinion in Syngenta Crop

Protection, which resolved a conflict between the circuits on the right to remove under the

All Writs Act, the District Court concluded that the basis for the removal here was

colorable when it occurred. In Mints v. Educational Testing Service, 99 F.3d 1253 (3d

Cir. 1996), we held that even though a party did not act in bad faith by removing a case,

the District Court nevertheless had broad discretion in deciding whether to award fees and

costs under 28 U.S.C. 1447(c). In the circumstances here, we find no abuse of discretion.

Essentially, for the reasons stated in its opinion, we will affirm the order of

the District Court.

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______________________________

TO THE CLERK:

Please file the foregoing Opinion.

/s/ Joseph F. Weis Jr
United States Circuit Judge

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