Standard of Review

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Twenty-five years ago, the U.S. Supreme Court ruled that courts should review an ERISA participant’s claim for benefits under a de novo standard of review unless the plan gives the plan fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.  Since then, courts have considered what type of plan language suffices to grant plan fiduciaries discretionary authority to warrant the more deferential arbitrary and capricious standard of review.

In Adams v. General Motors Company (Case No. 12-2084), the Sixth Circuit rejected an ineligible retiree’s claim for reinstatement of erroneous benefit payments under her former employer’s pension plan. The retiree received benefit payments for twenty-one months before the plan administrator realized that she was ineligible for benefits under the plan and ceased further benefit…

Yesterday, the Second Circuit ruled on two important issues of note for ERISA plan sponsors and plan fiduciaries.

In Thurber v. Aetna Life Insurance Co., 2013 WL 950704 (2d Cir. Mar. 13, 2013), the Court ruled that participants and beneficiaries are not required to be put on notice that:

  • the plan fiduciary has reserved

…

In Govrik v. Unum Life Ins. Co. of Am., 702 F.3d 1103 (8th Cir. 2013), the Eighth Circuit held that Unum operated under a structural conflict of interest (as it was both the decision-maker of the claim and the payer of benefits), but it did not abuse its discretion in terminating the insured’s LTD…