Statute of Limitations

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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…

The First Circuit held that a plaintiff failed to timely exhaust her administrative remedies under a long-term disability plan because the plan’s 180-day time limit for submitting appeals commenced on the date the plaintiff received notice of the decision that it was going to terminate her long-term disability benefits, not the actual date her benefits…

The Fifth Circuit held that the statute of limitations for an ERISA § 502(c)(1) claim—a claim for penalties for failure to provide certain documents within thirty days of a written request—was subject to a one-year statute of limitations.  In so holding, the Court borrowed the statute of limitations from the Louisiana Civil Code for claims…

A federal district court in California held that a complaint filed by members of the International Union of Operating Engineers that challenged pension plan trustees’ decision to make certain investments was filed five days too late and thus barred by ERISA’s six-year statute of limitations.  In so holding, the court ruled that the limitations period…

The Third Circuit recently held that ERISA administrative appeal denial letters must include plan-imposed time limits for commencing a lawsuit challenging the claim denial, and the failure to provide such notice warranted setting aside the plan’s limitation period.  Mirza v. Ins. Adm’r. of Am., Inc., 2015 WL 5024159 (3d Cir. Aug. 26, 2015). The…

ERISA plan fiduciaries charged with responsibility for selecting, monitoring or removing plan investment options should pay close attention to the U.S. Supreme Court’s recent ruling in Tibble v. Edison Intl., 135 S. Ct. 1823 (2015).  In that decision, the Court ruled that ERISA’s duty of prudence involves “a continuing duty to monitor investments and remove imprudent ones.”  Although the Court did not elaborate on what it viewed to be the scope of an ERISA plan fiduciary’s duty to monitor, the plaintiffs’ bar is already seizing on the ruling as a potential basis for asserting new claims based on a failure to monitor prudently plan investments and other plan functions.  Thus, plan fiduciaries are advised to establish a thoughtful and appropriate procedure for monitoring plan investment options, to diligently follow that procedure when monitoring plan investment options, and to make and preserve a written record reflecting that they followed their procedure in every regard.  Taking these steps will put fiduciaries in a favorable position should emboldened plan participants file lawsuits challenging whether fiduciaries fulfilled their duty to monitor plan investment options based on the perceived plaintiff-friendly Tibble ruling.

Plan trustees often look to settle ERISA fiduciary breach claims brought against them as a way to put the past behind them.  Assuming there is enough fiduciary liability insurance coverage available to pay the proposed settlement sum, the trustees may be prepared to put aside their desire to vindicate themselves for a challenged course of conduct, avoid the risks of a horrific outcome that exceeds insurance coverage limits—potentially causing them to use personal assets to satisfy a judgment against them—and move on.  Unfortunately, however, ERISA is structured in a manner that creates obstacles to achieving the goal of “complete peace.”

The Second Circuit recently held (in a summary order) that plan participants’ claims alleging violations of ERISA’s disclosure rules in connection with a cash balance conversion were barred by the statute of limitations.  In so ruling, the Court explained that because the participants’ claims that defendants breached their fiduciary duties by mischaracterizing the new plan’s…

A federal district court in Minnesota found that participants in a defined benefit pension plan had standing to assert claims that defendants breached their fiduciary duties by, among other things, shifting to an equities-only investment strategy that resulted in the plan becoming significantly underfunded and thereby increasing the risk of default.