Benefit Claim Procedures

The decision in Bolton v. Inland Fresh Seafood Corp. of America Inc., No. 22-cv-4602 (N.D. Ga. Dec. 5, 2023)should serve as a reminder to all ERISA practitioners that, if litigating in courts of the Eleventh Circuit, participants must exhaust a plan’s claims procedures before commencing a lawsuit—regardless of the type of ERISA claim asserted.

A recent Sixth Circuit decision emphasizes the importance of maintaining correct benefit plan delegations to avoid tussles over the correct standard of review for benefit claims.  In this case, the Sixth Circuit concluded that no deference was owed to a claim decision made by a company’s benefits department because the plan document neither named the benefits department as the entity with discretionary authority to decide claims nor permitted the benefits committee to delegate its discretionary authority to the benefits department.  The case is Laake v. Benefits Committee, Western & Southern Financial Group Co. Flexible Benefits Plan et al., 68 F.4th 984 (6th Cir. 2023).

A federal district court in Georgia recently dismissed claims brought by a participant in the Rollins, Inc. 401(k) Plan (the “Plan”), on behalf of a putative class of all plan participants, alleging that defendants breached their fiduciary duties by charging excessive recordkeeping fees, selecting and retaining costly and underperforming funds in the Plan and failing

Recently, the Sixth Circuit ruled in Hitchcock v. Cumberland University 403(b) Plan that pension plan participants are not required to exhaust their plan’s administrative remedies before pursuing claims alleging statutory violations of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”).[i] In so deciding, the Sixth Circuit joined the majority of circuit courts in holding that claims alleging statutory violations of ERISA do not impose the same administrative exhaustion requirements that are applicable to claims seeking to enforce contractual rights under the terms of a plan. By deepening the current split on this issue among the circuit courts, the ruling could have a significant impact on future ERISA litigations.

A federal district court in New Jersey held that supplemental documentation submitted by a participant in connection with the claims review process did not restart the clock for a claims administrator to decide the participant’s appeal.  Plaintiff Tracee Lewis-Burroughs timely appealed Prudential Insurance Company of America’s decision to stop paying her long-term disability benefits.

In Becker v. Mays-Williams, 13-35069-cv, 2015 WL 348872 (9th Cir. Jan 28, 2015), the Ninth Circuit – in a matter of first impression – concluded that beneficiary designation forms were not “documents and instruments governing” an ERISA plan, as described in Section 404(a)(1)(d) of ERISA.  A participant called the plan office and telephonically re-designated his son as his beneficiary under the various plans in which he was a participant, rather than his ex-wife. 

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)

Plan administrators sometimes are confronted with claims that appear untimely, but nevertheless focus solely on the substantive issue raised by the claim. A recent ruling from a federal district court in New Jersey suggests that the failure to address procedural issues may result in a finding that such defenses have been waived. In Becknell v.