Golden Gate Restaurant Association, et al. v. City and County of San Francisco, et al.

Case Updates

The Ninth Circuit Court declined to rehear en banc the decision by the three judge panel.

NCLC urged the Ninth Circuit Court of Appeals to rehear en banc a decision by a three judge panel holding that ERISA does not preempt a San Francisco law dictating how much a business must spend on employee health care. The health care ordinance requires companies to make health care expenditures on a per hour, per employee basis with expenditure rates determined by the city. Under the terms of the ordinance, health care fees may be paid into the city’s coffers to be used to provide health care to the city’s uninsured residents. Businesses who fail to comply with the ordinance’s burdensome accounting regulations and expenditure rules face substantial penalties and the loss of city permits.

In urging rehearing, NCLC argued that the ordinance frustrates Congress’ purpose in facilitating uniform benefits plan administration under the Employee Retirement Income Security Act (ERISA). The ordinance interferes with employer autonomy over whether and how to provide employee health coverage. NCLC warned that an adverse decision by the Ninth Circuit could result in an unworkable balkanization of health care regulatory regimes, inasmuch as union officials and other proponents of similar mandates have pledged to introduce legislation in as many as 30 other states.

The Ninth Circuit issued an opinion that could foster an unworkable balkanization of health care regulatory regimes. Union officials and others have pledged to introduce similar legislation in as many as 30 other states.

NCLC filed an amicus brief urging the three-judge panel to strike down the San Francisco law on federal preemption grounds.