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Several key points made in the brief include: Contrary to the principle of deference that has long prevailed in this area, plaintiffs and their amicus (including the Department of Labor) seek to replace the construction of the plan given by the plan administrator with the views of individual participants based upon their purported reasonable expectations; Plaintiffs claim insubstantial “conflicts” that could be asserted with respect to virtually any ERISA plan; Plaintiffs attempt to ignore the plan’s provisions based on allegedly incomplete disclosure documents; and They claim entitlement to a remedy with no basis in the governing statutory and equitable standards. Moreover, the brief adds that, “If a plan administrator’s construction can be denied deference based on the considerations plaintiffs and their amicus raise, it is hard to imagine a case where deference would apply. Their positions, moreover, would subject ERISA plans to potentially competing, de novo constructions in myriad district courts, destroying the uniformity on which ERISA plans depend.” Requiring courts to evaluate the views of plan participants is at odds with predictability and uniform administration, the brief further contends. If the plan’s meaning might turn on what beneficiaries subjectively believe, the plan’s meaning could vary from participant to participant. And referencing the views of an “objectively reasonable beneficiary” would force courts to speculate about the beliefs beneficiaries should have had. Supreme Court precedent, trust law principles and the plan at issue here relieve courts of that burden by requiring deference to the plan administrator’s reasonable construction, the brief asserts. ERIC President and CEO Scott Macey said, “If the district court ruling is not allowed to stand, you will see an influx of litigation from participants merely second guessing their plan administrator’s discretionary authority and reasonable decisionmaking.” The brief is here.
Several key points made in the brief include:
Moreover, the brief adds that, “If a plan administrator’s construction can be denied deference based on the considerations plaintiffs and their amicus raise, it is hard to imagine a case where deference would apply. Their positions, moreover, would subject ERISA plans to potentially competing, de novo constructions in myriad district courts, destroying the uniformity on which ERISA plans depend.”
Requiring courts to evaluate the views of plan participants is at odds with predictability and uniform administration, the brief further contends. If the plan’s meaning might turn on what beneficiaries subjectively believe, the plan’s meaning could vary from participant to participant. And referencing the views of an “objectively reasonable beneficiary” would force courts to speculate about the beliefs beneficiaries should have had. Supreme Court precedent, trust law principles and the plan at issue here relieve courts of that burden by requiring deference to the plan administrator’s reasonable construction, the brief asserts.
ERIC President and CEO Scott Macey said, “If the district court ruling is not allowed to stand, you will see an influx of litigation from participants merely second guessing their plan administrator’s discretionary authority and reasonable decisionmaking.”
Rebecca Mooreeditors@plansponsor.com