Construction Laborers Vacation Trust (CLVT) (defendant) was a trust established through an agreement between four associations of construction-industry employers and district and local labor unions in Southern California. Because union members typically worked for more than one construction employer in a year, the plan administered by CLVT ensured that union members received their guaranteed annual vacation pay by allowing each employer to pay money to CLVT as part of the employee's hourly wages. CLVT then put the money in an account for each employee and distributed the money to the employee once a year. This plan was an employee welfare benefit plan within the meaning of the Employee Retirement Income Security Act of 1974 (ERISA), 29 U.S.C. § 1001 et seq. The California Franchise Tax Board (Board) (plaintiff) was the state agency in charge of enforcing California's income-tax law. Among other things, California law required anyone in possession of a taxpayer's personal property or other valuable items to withhold any unpaid taxes, interest, or penalties due from the taxpayer and transmit those amounts to the Board. The Board filed a complaint against CLVT in California state court, alleging that CLVT had failed to transmit $380.56 in unpaid tax, penalties, and interest to the Board as required by the California law. The Board requested monetary damages and a declaration that CLVT was legally obligated to comply with all future tax levies issued by the Board. CLVT removed the action to federal district court, and the district court denied the Board's motion to remand to state court. The district court rejected CLVT's argument that ERISA preempted the Board's ability to levy funds held in trust by CLVT, but the appellate court reversed. The Board petitioned the appellate court for rehearing and renewed its argument that the federal courts lacked jurisdiction over the matter. The appellate court denied the petition for rehearing, and the Board appealed to the United States Supreme Court.