The Eighth Circuit recently held that language in Prudential’s disability policy requiring proof of disability that is “satisfactory to Prudential” was sufficient to grant the plan discretionary authority and entitled the plan to a deferential judicial review. Prezioso v. Prudential Ins. Co. of Am., No. 13-1641, 2014 WL 1356862 (8th Cir. April 4, 2014)
District Court Finds Fiduciaries Have No Duty to Investigate False Sale Allegations for ESOP Investment
In Malcolm v. Trilithic, Inc., 2014 WL 1324082, No. 1:13-cv-00073 (S.D. Ind. Mar. 31, 2014), the Southern District of Indiana held that plan fiduciaries were under no duty to investigate allegations that a false sale had been included in the company’s records as a way of “puff[ing] up [its] receivables account and profitability” to
Georgia Federal Court Holds that Continuing Course of Conduct Did Not Extend Statute of Limitations Period for Fiduciary Breach Claim
In Stargel et al. v. SunTrust Banks Inc. et al., No. 1:12-cv-03822, (N.D. Ga. Aug. 8, 2013), a Georgia federal judge dismissed a putative class action against Suntrust Banks. Among the claims it dismissed was a fiduciary breach claim based on defendant’s failure to remove its own allegedly underperforming funds in its 401(k) plan.
Seventh Circuit: Insurance Companies Are Proper Defendants In Suits For ERISA Benefits
The Seventh Circuit held that a health insurer that makes benefits determinations and pays benefit claims, rather than the health plan itself, is a proper defendant in an action for benefits under ERISA Section 502(a)(1)(B). In Larson v. United Healthcare Ins. Co., No. 12-1256, 2013 WL 3836236 (7th Cir. July 26, 2013) (unpublished), plan
Seventh Circuit: Terminated Employee’s Release Agreement Bars Pension Claim, ERISA’s Anti-Alienation Provision Does Not Apply
The Seventh Circuit dismissed a former employee’s claim for additional pension benefits after concluding that a release agreement he signed had waived any claims that arose prior to the signing of the release and his claim was not protected by ERISA’s anti-alienation provision. Hakim v. Accenture United States Pension Plan, No. 11-3438, 2013 WL
Sixth Circuit: Plan Fiduciary Reasonably Relied On Benefit Calculations In Communicating To Participant
The Sixth Circuit recently rejected a participant’s claim that a benefit estimate should override the specific benefit promised under the terms of the plan. In Stark v. Mars Inc., No. 12-3956, 2013 WL 1908889 (6th Cir. May 9, 2013) (unpublished), the Sixth Circuit affirmed summary judgment in favor of the plan’s fiduciary committee. The
View From Proskauer: U.S. Supreme Court Provides Defendants With More Ammunition for Defeating Class Certification by Requiring Classwide Proof of Damages
The U.S. Supreme Court recently ruled in Comcast Corp. v. Behrend, 2013 WL 1222646 (U.S. Mar. 27, 2013) that, in order to obtain class certification, plaintiffs carry the burden of establishing not only that they have proof of classwide liability, but also that their potential damages are tied to their theory of liability and capable of classwide proof. The Court’s ruling follows on the heels of its ruling in Wal-Mart Stores, Inc. v. Dukes, 131 S. Ct. 2541 (2011), in which it suggested that the admissibility standard for expert evidence outlined in Daubert v. Merrell Dow Pharmaceuticals Inc., 509 U.S. 579 (1993), should apply at the class certification stage. Instead of ruling on the Daubert issue, the Court provided what could prove to be an even more effective means for defeating class certification.