Employee Benefits & Executive Compensation Blog

The View from Proskauer on Developments in the World of Employee Benefits, Executive Compensation & ERISA Litigation

Neil V. Shah

Neil V. Shah

Associate

Neil V. Shah is an associate in the Labor & Employment Law Department and a member of the Employee Benefits & Executive Compensation Group, where he focuses on ERISA litigation.

Neil represents plan sponsors, trustees, and other fiduciaries in ERISA class actions for breach of fiduciary duty arising out of investment losses and prohibited transactions, as well as Department of Labor and other governmental and internal investigations. Neil also counsels both employers and multiemployer funds regarding the assessment and collection of delinquent contributions and withdrawal liability.

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Seventh Circuit Holds Withdrawal Liability Cannot Be “Decelerated”

The Seventh Circuit held that a multiemployer pension fund’s withdrawal liability claim was barred by the six-year statute of limitations applicable to claims under the Multiemployer Pension Plan Amendments Act (MPPAA).  After the employer failed to make several quarterly withdrawal liability payments, the fund declared the employer to be in default, accelerated its withdrawal liability, … Continue Reading

Prominently Displayed, Fundamental Discrepancy In Benefits Triggered Contractual Limitations Period

The Fifth Circuit concluded that a plan’s three-year contractual limitations period began to accrue when a beneficiary received a letter in 2008 that prominently displayed on the first page the monthly earnings used to calculate his long term disability benefits.  The Court held that the claim was time-barred because the beneficiary failed to bring his … Continue Reading

SDNY Rejects Class Standing and Fiduciary Breach Claims In Connection With Alleged Double-Charging Scheme

A New York federal district court concluded that a defined benefit plan participant lacked standing to seek relief on behalf of plans other than the one in which he was a participant. In this case, plaintiff claimed that defendants breached ERISA fiduciary duties and engaged in prohibited transactions by charging undisclosed markups for securities trades. … Continue Reading

Tenth Circuit Upholds Denial of Residential Mental Health Treatment

The Tenth Circuit upheld a claims administrator’s decision denying a claim for residential mental health treatment as not medically necessary. In so holding, the Court rejected plaintiff’s argument that the claims administrator’s refusal to produce data on its historical denial rates for mental health treatment warranted a de novo review because that information was not … Continue Reading

Categorical Conflict of Interest Does Not Alter Standard of Review of Benefit Denials

The Second Circuit held that plaintiffs’ allegations that the defendant suffered from a “categorical potential conflict of interest”—because it both funded the plan and was the claim’s decision-maker—did not affect the application of the arbitrary and capricious standard of review in the absence of a showing by the plaintiffs that the conflict actually affected the … Continue Reading

Participants’ ERISA Retaliation Claim Dismissed

A federal district court in Illinois held that participants in a multiemployer pension plan failed to plausibly allege that plan fiduciaries retaliated against them in violation of ERISA § 510 by refusing to consider their employer’s offer to settle its withdrawal liability to the plan.  In lieu of paying withdrawal liability, the employer offered to create … Continue Reading

ERISA Implications for Firing A Whistleblower

The Ninth Circuit unanimously concluded that a trustee and lawyer for certain multiemployer funds violated ERISA § 510 by unlawfully firing a whistleblower in the funds’ collections department, but, in a split decision, concluded that the retaliation did not amount to a breach of fiduciary duty.  The whistleblower was cooperating with a DOL criminal investigation of … Continue Reading

Ninth Circuit Deepens Circuit Split Over Whether Delinquent Contributions Are Plan Assets

The Ninth Circuit held that employer contributions due to a Taft Hartley fund are not plan assets until they are actually paid to the fund, irrespective of whether the plan document defines plan assets to include unpaid employer contributions.  As a result, a fund could not hold a contributing employer’s owner and treasurer personally liable … Continue Reading

Seventh Circuit Rejects “Big Buyer” Defense to Successor Liability

For a multiemployer pension fund to hold an asset purchaser liable for withdrawal liability as a successor-in-interest, the fund must establish that the purchaser was (i) on notice of the seller’s withdrawal liability, and (ii) the purchaser “substantially continued” the seller’s operations.  In Ind. Elec. Workers Pension Benefit Fund v. ManWeb Servs., No. 16-cv-2840, 2018 WL … Continue Reading

Third Circuit Deepens Circuit Split Over Test for “Top Hat” Status Under ERISA

A Third Circuit decision, Sikora v. UPMC, 876 F.3d 110 (3d Cir. 2017), deepens a circuit split over whether a participant’s bargaining power is relevant to determining whether a plan qualifies for “top hat” status under ERISA. Plans that qualify for “top hat” status are exempt from ERISA’s eligibility, vesting, funding, and fiduciary requirements. To … Continue Reading

District Court Dismisses Allegations That Stable Value Fund is Too Conservative

A district court in Rhode Island dismissed claims by participants in the CVS Employee Stock Ownership Plan that plan fiduciaries imprudently invested plan assets in the plan’s stable value fund. Plaintiffs argued that the stable value fund had an excessive concentration of investments with ultra-short durations and excessive liquidity, both of which caused the fund … Continue Reading

Sixth Circuit Dismisses ERISA Stock Drop Action Against Cliffs Natural Resources

The Sixth Circuit affirmed the dismissal of ERISA stock drop claims by participants in the Cliffs Natural Resources’ 401(k) Plan. The participants alleged fiduciary breach claims based on public and non-public information arising out of the collapse in iron ore prices that caused the company’s stock price to decline 95%. With respect to the public information claim, … Continue Reading

Second Circuit Affirms Dismissal of Claim Arising from Incorrectly Addressed COBRA Notice

In Vangas v. Montefiore Medical Center, 2016 WL 2909354 (2d Cir. May 19, 2016), the Second Circuit affirmed the district court’s holding that an employer is not liable for failing to provide a COBRA notice to a terminated employee under ERISA § 502(c) where the employer followed reasonable procedures to ensure that notices were properly … Continue Reading

Anti-Assignment Provision Bars Surgery Center’s $3.3 Million ERISA Benefits Claims

A federal district court in California held that the ILWU-PMA Welfare Benefit Plan’s anti-assignment provision barred Brand Tarzana Surgical Institute’s claim for benefits and thus dismissed the Institute’s claim for benefits.  In so holding, the court rejected the Institute’s argument that the plan waived the right to assert the anti-assignment provision as a defense by … Continue Reading

On Remand, District Court Rules for the Fiduciaries in Tatum v. R.J. Reynolds

The R.J. Reynolds defendants have again prevailed against allegations that they breached their fiduciary duties by divesting the RJR 401(k) plan of funds invested in Nabisco stock.  Following remand by the Fourth Circuit, the district court held that a hypothetical fiduciary “would” have divested the plan of the Nabisco investments in the same time and … Continue Reading

Eighth Circuit Holds Service Provider Is Not A Plan Fiduciary In Excessive Fee Case

Continuing a trend in other Circuits, the Eighth Circuit held that a service provider that was contracted to provide the 401(k) plan’s investment options does not act as an ERISA fiduciary when, consistent with the terms of a contract it negotiated at arms’ length, it passes through operating expenses to participants.  The Court also rejected the plan’s … Continue Reading

Defined Benefit Plan Participant’s Action Mooted by ERISA Plan’s Improved Financial Condition

A federal district court in Minnesota dismissed a plan participant’s allegations that plan fiduciaries mismanaged a defined benefit plan — and thus caused it to be underfunded — because the plan’s financial condition improved during the course of the litigation.  As reported here, the court previously held that these allegations were sufficient to establish that … Continue Reading

Court Awards $11.7M in Attorneys’ Fees In Fund Mapping Case

The court in Tussey v. ABB Inc., No. 2:06-cv-04305 (W.D. Mo. Dec. 9, 2015), a long-running suit alleging that ABB failed to monitor recordkeeping fees and improperly mapped participants’ investments (previously reported on here), awarded class counsel $11.7 million in attorneys’ fees and affirmed its earlier award of $2.28 million in costs and class representative … Continue Reading

DOL Proposes to Bring ERISA Disability Denials in Line with the Affordable Care Act

On November 18, 2015, the Department of Labor (the “Department”) published a notice of Proposed Rulemaking at 80 Fed. Reg. 222 (the “Proposed Rule”) to amend ERISA’s claims procedures (29 C.F.R. 2560.503-1) as they apply to claims for disability benefits.  One of the purposes of the Proposed Rule is to make ERISA’s claims procedures for … Continue Reading

Sixth Circuit Enforces Subrogation Clause

The Sixth Circuit rejected a participant’s argument that the plan’s subrogation provision was not enforceable because it was only in the plan’s summary plan description, and not in the trust agreement that the participant argued was the operative plan document.  The Court determined that the subrogation provision was contained within a document that served as … Continue Reading

No Damages Awarded for ERISA Plan Fund Mapping Claims

Mapping in a 401(k) plan occurs when an investment option is removed and the participant’s investment in that option is transferred to a different investment option (absent direction from the participant).  On remand from the Eighth Circuit, the district court in Tussey v. ABB Inc., No. 2:06-cv-04305 (W.D. Mo. July 9, 2015), held that plan … Continue Reading

District Court Rules Privately-Held Stock Plan Fiduciary May Have Affirmative Duty To Disclose

A federal district court in Georgia held that plan fiduciaries of a closely-held company’s single stock ERISA fund may have a duty to disclose material, non-public information concerning the value of the company’s shares when the information could have a potentially extreme negative effect on a plan participant.  The plaintiffs were participants in defendant Stiefel … Continue Reading
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