U.S. Fifth Circuit Strikes Down the Obama Administration’s “Fiduciary Rule”

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The U.S. Chamber and two other business groups filed suit in the Northern District of Texas, challenging the “Fiduciary Rule” – a package of seven different DOL Regulations that broadly re-interpret the term “investment advice fiduciary” and re-define exemptions that relate to fiduciaries from ERISA and the Internal Revenue Code.  On appeal, the U.S. Fifth Circuit struck down the Rule. …

U.S. Fifth Circuit, En Banc, Reverses Pierre, and Holds that Review for Factual Determinations is De Novo Where Plan Does Not Afford Administrator Discretion

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  “When an ERISA plan lawfully delegates discretionary authority to the plan administrator, a court reviewing the denial of a claim is limited to assessing whether the administrator abused that discretion. For plans that do not have valid delegation clauses, the Supreme Court has held that a denial of benefits challenged under §1132(a)(1)(B) is to be reviewed under a de …

U.S. Fifth Circuit Affirms Dismissal of Breach of Fiduciary Duty Claims in Connection with Radio Shack Bankruptcy

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The RadioShack 401(k) Plan allowed participants to invest their deferred salary or company match contributions in over twenty investment options. The Plan had an Employee Stock Ownership Plan (ESOP) that allowed participants to invest their retirement savings in RadioShack stock, which was held in the RadioShack Stock Fund. Plan documents required that RadioShack be offered as an investment option. If …

U.S. Fifth Circuit Holds that Penalty Action for Failure to Provide Plan Documents is Subject to Louisiana’s One-Year Prescriptive Period

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“Babin primarily argues that the ten-year period should apply because his claim is based on a contractual and fiduciary obligation…. But analogizing §1132(c) to a breach of fiduciary duty does not help Babin’s case. Louisiana courts do not apply the ten-year statute of limitations to all breach of fiduciary duty claims. Rather, a breach of fiduciary duty claim is contractual …

U.S. Fifth Circuit Explains Savings Clause Affirming Dismissal of Suit for Life Insurance Benefits Originally Filed in State Court

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Swenson filed suit in Louisiana State Court seeking benefits from a life insurance policy after her husband passed away. The insurance company refused to pay based on its belief that Swenson’s husband was not a covered employee at the time of his death. Swenson cited Louisiana statutes imposing certain requirements on group life policies concerning the rights of a discharged …

U.S. Fifth Circuit Affirms Dismissal of Claim for Disability Benefits where Loss of Eye from Fungal Infection not “Accident” under Plan

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The plaintiff traveled to West Texas twice in connection with his job, and developed a fungal infection in his right eye that was diagnosed as coccidioidomycosis. Medical providers determined that contact with a West Texas fungus caused the infection, which led to progressive loss of vision, and the ultimate removal of that eye. Disability benefits were denied based on the …

Southern District of New York Certifies (b)(1) Class Claims under ERISA for Mismanagement of 401(k) Plan

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“Defendants object to class certification under Rule 23(b)(1) as improper in the wake of the Supreme Court’s decisions in LaRue and Wal-Mart. Although courts are split over whether Rule 23(b)(1)(B) remains an appropriate class vehicle for fiduciary-breach claims under ERISA, a majority have held that it is…. “Defendants argue that, because the Supreme Court in LaRue held that §1132(a)(2) allows …

U.S. Fifth Circuit Grants Rehearing, En Banc, to Consider the Appropriate Standard of Review for Factual Determinations Where Plan Does Not Afford Administrator Discretion

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On July 10, 2017, the U.S. Fifth Circuit granted a Petition for Rehearing, En Banc, to consider the panel’s decision in Ariana M. v. Humana, 854 F.3d 753 (5th Cir. 2017), affirming the denial of medical benefits to a plan beneficiary who had been hospitalized due to serious mental health conditions.  Applying an abuse of discretion standard of review under the Circuit’s …

U.S. Fifth Circuit Affirms Order to Reimburse Plan and to Pay Attorneys Fees, Rejecting Participant’s Challenge to ERISA’s Written Instrument Requirements

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Rhea was the beneficiary of an employee benefit plan who suffered injuries from medical malpractice. The plan covered some of her medical expenses, and, after she settled the malpractice claim, sought reimbursement.  Rhea refused to reimburse the plan, claiming that it did not have an enforceable written instrument.  The court, on report and recommendation of the presiding Magistrate Judge, held that …

Fifth Circuit Throws Out ERISA Suit against BP over 2010 Spill

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On interlocutory appeal, the U.S. Fifth Circuit Court of Appeals reversed the denial of BP’s Rule 12 Motion to Dismiss the Amended Complaint of BP pension plan stockholders for breach of fiduciary duty. “In Fifth Third, the Supreme Court stated that the plaintiff’s proposed alternative must be one that ‘a prudent fiduciary in the same circumstances would not have viewed …