Franchise Tax Board v. Construction Laborers Vacation Trust

*957 Opinion

Introduction

The sole issue of this appeal is whether the Employee Retirement Income Security Act of 1974, 29 United States Code section 1001 et seq. (ERISA) permits state tax authorities to collect unpaid state income taxes by levying on funds held in trust for taxpayers under an ERISA-covered vacation benefit plan. Respondent Franchise Tax Board of the State of California (the Board) has attempted to levy upon the accounts of several delinquent state income taxpayers held in trust by the Construction Laborers Vacation Trust for Southern California (CLVT or the Trust). The plan that CLVT administers is an “employee welfare benefit plan” within the meaning of ERISA ( 29 U.S.C. § 1002 (1)). After protracted, related litigation between the Board and CLVT, which included appeals to the Ninth Circuit Court of Appeals and the United States Supreme Court, the Superior Court of Los Angeles County granted the Board’s motion for summary judgment, holding that the Board’s authority to levy upon funds held by CLVT was not preempted by ERISA. In accordance with ERISA preemption principles, recently articulated by the United States Supreme Court in Mackey v. Lanier Collections…