A federal district court in Louisiana upheld a Texas state law prohibiting insurers from granting themselves discretion to interpret benefit plans when deciding benefit claims. These so-called “discretionary clauses” are routinely found in plans governed by ERISA and generally result in courts deferring to the plan administrator’s decisions. As a practical matter, the current ruling

Madeline Chimento Rea
Third Circuit Rules That Johnson Controls Did Not Promise Lifetime Health Benefits
The Third Circuit rejected a claim for lifetime health insurance benefits filed by retired employees of Johnson Controls, finding that the clear and unambiguous language of the CBAs and group insurance booklets did not guarantee lifetime health insurance benefits. The suit was filed after the group insurance booklets, which were incorporated into and subject to…
The United States Supreme Court Rules in Favor of Hospitals on “Church Plan” ERISA Exemption
The United States Supreme Court unanimously ruled in favor of religiously-affiliated hospitals and healthcare organizations in holding that a pension plan need not be established by a church in order to qualify for ERISA’s church plan exemption. Petitioners are religiously affiliated non-profit healthcare organizations appealing decisions by the Third, Seventh, and Ninth Circuit Courts of…
First Circuit Enforces Arbitration of ERISA Dispute
The First Circuit concluded that, pursuant to the applicable collective bargaining agreement, it was for an arbitrator, not the court, to decide whether the union’s claim that the employer failed to properly fund a defined benefit pension plan was preempted by ERISA. The First Circuit explained that the arbitration clause in the CBA clearly applied…