Public prepaid legal association outside ERISA welfare plan

P/OPINION 75-08



                                                             3(1)


                        November 14, 1975


Dear              :

I am writing with respect to your inquiry as to the
applicability of the Employee Retirement Income Security
Act of 1974 to the           Association, Inc., the
Petitioner-Defendant in the above-captioned civil action.

We have reviewed the Petition for Removal and the Motion
to Remand (and attachments) in this matter. In our view,
it appears from these allegations that the Petitioner-
Defendant is not a plan within the meaning of section
3(1) of the Act. That section provides, in pertinent
part that an “employee welfare benefit plan” or “welfare
plan” is any plan, fund, or program which is established
by an employer or by an employee organization, or by both,
to the extent that such is established or maintained
for the purpose of providing for its participants or
beneficiaries, “through the purpose of insurance or
otherwise”, prepaid legal services.

We consider it significant that the Petitioner-Defendant
states in its petition for removal that it is engaged
in a business (paragraph 2) and that it is alleged in
Plaintiff’s state court petition that the Petitioner-
Defendant is soliciting participation by the public
(paragraphs 4 and 5, Ex. C), rather than being restricted
to persons in an employment relationship to the plan
sponsor (see § 3(16)(B) of the Act).
2

P/OPINION 75-08



Accordingly, it does not appear from the information
available to us at this time that the Petitioner-Defendant
is a plan, program or fund “established or maintained by
an employer or by an employee organization, or by both”
as required by section 3(1) of the Act.

I hope that these comments will be helpful. They are
intended to be in the nature of an amicus curiae statement,
and we would have no objection if you wished to transmit
copies of this letter to the parties. If we may be of
further assistance, please advise me.

Sincerely,