:: Argument Set For MetLife v. Glenn
The oral argument calendar for April has been released by the U.S. Supreme Court, and MetLife v. Glenn is scheduled for April 23rd, 2008. Pension Protection Act Blog
The outcome of this case has substantial implications for judicial review of claims adjudication decisions. It is of vast importance to plan participants, their assignees (such as health care providers) and plan fiduciaries as to what standard a reviewing court will use when reviewing a benefits denial.
The significance of MetLife v. Glenn can be brought into perspective by reference to a key excerpt in Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989) , the seminal standard of review decision.
In that case, the Supreme Court stated:
Consistent with established principles of trust law, we hold that a denial of benefits challenged under 1132(a)(1)(B) is to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan.
Because we do not rest our decision on the concern for impartiality that guided the Court of Appeals, see 828 F.2d, at 143-146, we need not distinguish between types of plans or focus on the motivations of plan administrators and fiduciaries. Thus, for purposes of actions under 1132(a)(1)(B), the de novo standard of review applies regardless of whether the plan at issue is funded or unfunded and regardless of whether the administrator or fiduciary is operating under a possible or actual conflict of interest. Of course, if a benefit plan gives discretion to an administrator or fiduciary who is operating under a conflict of interest, that conflict must be weighed as a “facto[r] in determining whether there is an abuse of discretion.” Restatement (Second) of Trusts 187, Comment d (1959). (emphasis supplied)
What does that mean? The Courts of Appeal have differed in their opinions. See,:: The Elusive ERISA Standard Of Review – Conflicts, Metaphors & Reversals
The Supreme Court will decide:
#1 Whether an administrator that both evaluates and pays claims under a plan governed by the Employee Retirement Income Security Act (ERISA), 29 U.S.C. 1001 et seq., is operating under a conflict of interest that must be weighed on judicial review of a benefit determination?
#2 If an administrator that both determines and pays claims under an ERISA plan is deemed to be operating under a conflict of interest, how should that conflict be taken into account on judicial review of a discretionary benefit determination?â€
Note: The links to the Sixth Circuit opinion and other pertinent documents are conveniently organized by Suzanne L. Wynn, Esq. here.
Query - Under what circumstances would a motion to stay proceedings pending a decision in Met Life be advantageous? Depending on the facts and the jurisdiction, it is an issue that should be considered.
