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Cert granted in ERISA case
June 30, 2009 by Ross Runkel at LawMemo
The US Supreme Court has granted certiorari in an ERISA case that raises issues on (1) the extent to which a district court must defer to the views of an ERISA plan administrator and (2) the appropriate scope of appellate review. This case will be argued in the fall.
Conkright v. Frommert (Certiorari granted 06/29/2009).
Xerox employees sued their ERISA retirement Plan and administrator challenging the method used by the Plan to calculate how their current benefits are offset to reflect prior distributions. The employees claimed that the Plan violated ERISA's provisions relating to summary plan description, notice, and anti-cutback rules.
There were two appeals to the 2nd Circuit. In the first appeal, the court held that the Plan had violated ERISA in several respects, and remanded for fashioning a remedy. On remand, the district court decided upon a remedy without first remanding the case to the Plan administrator.
In the second appeal, the 2nd Circuit made two key rulings:
(1) The district court was not required to defer to the Plan administrator's views on the appropriate remedy for the ERISA violations committed by the administrator and the Plan.(2) The court of appeals should review the district court's remedial decision for abuse of discretion. The US Supreme Court granted certiorari to review the 2nd Circuit's judgment.
The formal Questions Presented:
1. Whether the Second Circuit erred in holding, in conflict with decisions of this Court and other Circuits, that a district court has no obligation to defer to an ERISA plan administrator's reasonable interpretation of the terms of the plan if the plan administrator arrived at its interpretation outside the context of an administrative claim for benefits.2. Whether the Second Circuit erred in holding, in conflict with decisions of other Circuits, that a district court has "allowable discretion" to adopt any "reasonable" interpretation of the terms of an ERISA plan when the plan interpretation issue arises in the course of calculating additional benefits due under the plan as a result of an ERISA violation.
[The Supreme Court denied two other petitions for certiorari arising out of the 2nd Circuit decision. Those petitions involved the effect of general releases as waivers of ERISA claims.]
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