Mackey v. Lanier Collection Agency & Service, Inc.

486 U. S. 825

June 17, 1988

Creditors tried to obtain money by garnishing an ERISA employee welfare plan. A Georgia law banned garnishing ERISA plans, but this law was said to be pre-empted by ERISA itself. Additionally, the debtors argued that even without the Georgia law, the suits for garnishing were also pre-empted by ERISA. ERISA did openly say that state laws about ERISA were pre-empted, and it did prohibit any garnishment of employee pension plans, but it was murkier about employee welfare plans.

The Court unanimously ruled that the Georgia law was pre-empted, but split 5-4 about the garnishment. White said the Georgia law was flatly banned by the text of ERISA, and that was that. With respect to the garnishment question, White observed that the law did seem to tacitly assume in a few places that employee welfare plans might be sued. He also emphasized that the part of the law explicitly protecting pension plans from garnishment would be surplusage if all plans were meant to be implicitly protected from garnishment. Finally, White rejected the argument that Congress seemed to reject the possibility of welfare plan garnishment when they amended ERISA in 1984. He contended that the intent of the original drafters was what mattered, and not latter amending legislators.

Kennedy, joined by Blackmun, O’Connor, and Scalia, dissented. He argued that some of the law’s features that implicitly pointed to allowing garnishment suits were being wrongly construed. He stressed that garnishment was extremely disruptive to ERISA plans. ERISA pre-empted state laws relating to plans, and if garnishment was so disruptive, then Kennedy felt that state laws allowing the procedure qualified. While the text specifically exempting pension plans was mildly redundant, Kennedy said that the majority’s refusal to come to grips with the 1984 amendments constituted far worse violence against the statutory text. The intent behind the amendment could not be ignored or dismissed on the argument that only the original drafters were relevant.

I’m all in favor of debts being paid, but Kennedy really is right about the effect of the 1984 amendments. The majority’s treatment of that argument is clearly cavalier, and I’m surprised that White got five votes for it.

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