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ERISA BENEFITS

LITIGATIONANSWER BOOK

2018 Edition

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ERISA BENEFITS

LITIGATIONANSWER BOOK

2018 Edition

Edited by Craig C. Martin

Amanda S. Amert

Practising Law Institute New York City

#55290

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vii

About the Editors

Craig C. Martin is a partner at Jenner & Block, LLP, chair of the firm’s Litigation Department, and a long-time member of the firm’s governing committee. Mr. Martin’s practice focuses on litigation and corporate issues in the courtroom and in the boardroom. Mr. Martin is AV Peer Review Rated, Martindale-Hubbell’s highest peer recognition for ethi-cal standards and legal ability.

Mr. Martin is a member of the American Bar Association and its Section on Litigation where he has served in a number of leadership roles. For nearly two decades, he was a member of the Corporate Board of Directors of the Boys and Girls Clubs of Chicago, including serving, most recently, as chairman. Mr. Martin is a member of the Board of the Crown Family Philanthropies, serves on the Executive Committee of the Board of Directors of the Lyric Opera of Chicago and as a board member of the Millennium Park Foundation, and as a member of the Commercial Club of Chicago, the Chicago Club, and the Economic Club of Chicago. Mr. Martin also serves on the Illinois Supreme Court to the Committee on Character and Fitness.

Mr. Martin received his J.D. from Harvard Law School in 1988, and his B.A., magna cum laude, from the University of Notre Dame in 1985.

Amanda S. Amert is a partner at Jenner & Block, LLP. She is a mem-ber of the firm’s Complex Commercial Litigation Practice Group and chair of the firm’s ERISA Litigation Practice, and is a member of the firm’s management committee and a co-chair of its Women’s Forum. Ms. Amert’s practice focuses on commercial litigation and counseling that is central to her clients’ business.

Ms. Amert is a member of the boards of directors of the Chicago Legal Aid Society and the Chicago Debate Commission. She was selected for and completed a term as Leadership Fellow with Leader-ship Greater Chicago in 2011–12.

Ms. Amert received her J.D., cum laude, in 2000 from Duke Univer-sity School of Law, and her B.A., cum laude, from Williams College in 1997.

ix

About the Contributors

Reena R. Bajowala is a partner in the firm’s Complex Commercial Litigation practice, and focuses on ERISA litigation, Class Action and Information Technology matters. Ms. Bajowala graduated cum laude from the University of Michigan Law School in 2005 and received a Bachelor of Arts degree from the University of Illinois in 2001.

Jennifer T. Beach is a special counsel in the firm’s Complex Commercial Litigation and ERISA Litigation Practices. In addition to ERISA, she has significant experience litigating in a number of substantive areas, including False Claims Act litigation, franchise law, patent disputes, and professional responsibility. Ms. Beach received her J.D. magna cum laude from Washington University School of Law in 2010 and graduated summa cum laude from Washington University in St. Louis in 2006.

Cristina Covarrubias is an associate in the firm’s ERISA Litigation and Complex Commercial Litigation Practices. She received her J.D. from The University of Chicago Law School in 2011 and her B.A. in Government from Harvard University in 2005.

Brienne M. Letourneau is a senior associate in the firm’s ERISA Litiga-tion Practice, as well as in the Complex Commercial Litigation and Class Action Practices. She focuses her practice primarily on class action defense, ERISA, higher education, and consumer law. She graduated from Harvard Law School in 2010 and obtained her B.A. with Highest Honors and Highest Distinction from the University of North Carolina in 2007.

xi

Table of Chapters

Chapter 1 ERISA Causes of ActionChapter 2 ERISA Actions in Federal CourtChapter 3 Class Action LitigationChapter 4 Fiduciary Duties Under ERISAChapter 5 Breach of Fiduciary Duty LitigationChapter 6 Stock Drop LitigationChapter 7 ESOP LitigationChapter 8 Cash Balance Plan LitigationChapter 9 Prohibited Transaction LitigationChapter 10 401(k) Fee LitigationChapter 11 Litigation to Recover Benefits Due Under a PlanChapter 12 Multiemployer Plan LitigationChapter 13 Managed Care Plan LitigationChapter 14 Discrimination and Interference with Benefits Rights

LitigationChapter 15 Litigation of Claims Arising Under Federal Common

LawChapter 16 Affirmative Defenses to ERISA ClaimsChapter 17 Limitations on Actions Under ERISAChapter 18 Special Considerations for ERISA Litigation

xiii

Table of Contents

About the Editors �� viiAbout the Contributors ��ixTable of Chapters ��xiTable of Contents �� xiii

Chapter 1 ERISA Causes of Action

ERISA Causes of Action—General ��1-2

Q 1�1 What are the most common ERISA causes of action? ��1-2

Denial of Benefits Claims ��1-3

Q 1�2 What rights or duties are at issue in claims for denial of benefits? ��1-3

Q 1�2�1 Who are the proper parties in a claim for denial of benefits? ��1-3

Q 1�2�2 What are common allegations in claims for denial of benefits? ��1-3

Q 1�2�3 What elements must a plaintiff generally establish in a claim for denial of benefits? ��1-5

Q 1�2�4 What relief is available for claims for denial of benefits? ��1-6

Breach of Fiduciary Duty Claims��1-6

Q 1�3 What rights or duties are at issue in breach of fiduciary duty claims? ��1-6

Q 1�3�1 Who are the proper parties in a claim for breach of fiduciary duty? ��1-6

Q 1�3�2 What are some common allegations in a claim for breach of fiduciary duty? ��1-7

Q 1�3�3 What elements must generally be proved to prevail in a claim for breach of fiduciary duty? ��1-8

Q 1�3�4 What relief is available? ��1-8

ERISA BEnEfItS LItIgAtIon AnSwER Book 2018

xiv

Knowing Participation Claims ��1-9

Q 1�4 What rights or duties are at issue in knowing participation claims? ��1-9

Q 1�4�1 Who are proper parties in claims for knowing participation in a violation of ERISA? ��1-10

Q 1�4�2 What are common allegations in knowing participation actions? ��1-10

Q 1�4�3 What elements must a plaintiff generally establish?��1-10

Q 1�4�4 What relief is available? ��1-11

Interference Claims ��1-11

Q 1�5 What rights or duties are at issue in interference claims? ��1-11Q 1�5�1 Who are the proper parties for an

interference claim? ��1-11Q 1�5�2 What are some common types of interference

actions? ��1-12Q 1�5�3 What elements must a plaintiff generally

establish?��1-12Q 1�5�4 What relief is available? ��1-13

Common Law Claims ��1-13

Q 1�6 What common law claims may be made under ERISA? ��1-13

Chapter 2 ERISA Actions in Federal Court

ERISA Interactions with State and Local Laws ��2-2

Q 2�1 How does ERISA interact with state and local laws governing contract, employment, insurance, and other areas? ��2-2

Preemption ��2-2

Q 2�2 Does ERISA preempt state laws? ��2-2Q 2�2�1 What is the scope of ERISA preemption? ��2-2

ERISA Civil Remedies ��2-3

Q 2�3 What civil remedies does ERISA exclusively provide? ��2-3Q 2�3�1 What does it mean for a state law

to “relate” to ERISA? ��2-3

Table of Contents

xv

Q 2�3�2 What does it mean for a state law to “refer” to ERISA? ��2-4

Q 2�3�3 What does it mean for a state law to have a connection to ERISA? ��2-5

State Law Exceptions from Preemption ��2-5

Q 2�3�4 Which state laws are excepted from ERISA preemption? ��2-5

Impact of State Insurance Laws ��2-6

Q 2�3�5 Are employer-funded ERISA plans subject to state insurance laws? ��2-6

Q 2�3�6 What indicates whether a law regulates insurance so as to avoid preemption under ERISA? ��2-6

Standing to Bring an ERISA Civil Action ��2-7

Q 2�4 Who has standing to bring an ERISA suit? ��2-7Q 2�4�1 Who has standing to bring breach of

fiduciary duty claims? ��2-7Q 2�4�2 Who has standing to sue for equitable relief? ��2-9Q 2�4�3 What parties have standing to sue based on

information requests? ��2-9Q 2�4�4 Are any other parties allowed to bring ERISA suits? ��2-10

Removal to Federal Court ��2-10

Q 2�5 Are ERISA actions in state court subject to removal? ��2-10Q 2�6 How does a defendant remove an ERISA case? ��2-12

Chapter 3 Class Action Litigation

In General ��3-2

Q 3�1 Why would a plaintiff bring a class action in an ERISA case? ��3-2

Types of Claims Eligible for Class Action Status ��3-3

Q 3�2 What types of ERISA claims are brought as class actions? ��3-3

Q 3�2�1 Can a claim for breach of fiduciary duty under ERISA § 502(a)(2) be brought as a class action? ��3-3

Q 3�2�2 Can a claim for individual relief under ERISA § 502(a)(3) be brought as a class action? ��3-3


xvi

Requirements for Certification Under Rule 23(a) ��3-3

Q 3�3 What are the requirements for the certification of an ERISA class? ��3-3

Q 3�3�1 Are the merits considered at the class certification stage? ��3-4

Q 3�3�2 What issues or classes can be certified? ��3-4Q 3�3�3 When does class certification occur? ��3-4

Q 3�4 What are the requirements of Rule 23(a)? ��3-4

Numerosity��3-4

Q 3�4�1 What is required under Rule 23(a)(1)? ��3-4

Commonality ��3-5


Typicality ��3-6


Adequacy of Representation ��3-6

Q 3�4�4 What is required under Rule 23(a)(4)? ��3-6Q 3�4�5 Is there interplay among the four requirements

of Rule 23(a)? ��3-7

Impact of Representations Made to Beneficiaries ��3-8

Q 3�4�6 When an ERISA breach of fiduciary duty claim is based upon representations made to participants and beneficiaries, what class certification issues arise under Rule 23(a)?��3-8

Potential Defenses Under Rule 23(a) ��3-9

Q 3�4�7 How do potential defenses affect the requirements of Rule 23(a)? ��3-9

Requirements for Certification Under Rule 23(b) ��3-9

Q 3�5 What are the requirements of Rule 23(b)? ��3-9

Risk of Inconsistent and Binding Decisions ��3-10

Q 3�5�1 How can a plaintiff meet the requirements of Rule 23(b)(1) in an ERISA case? ��3-10

Defendant Subject to Injunctive or Declaratory Relief ��3-10


Table of Contents

xvii

Common Questions of Law or Fact ��3-12


Q 3�5�4 What is the practical effect of having a class certified under Rule 23(b)(1), 23(b)(2) or 23(b)(3)? ��3-13

Q 3�6 Are jury trials available in class action cases? ��3-13

Release of Liability Issues in Settlement Situations ��3-13

Q 3�7 What unique issues arise in settlement of ERISA class actions? ��3-13

Q 3�7�1 How effective are releases of liability in class situations? ��3-14

Q 3�7�2 What exempts class action settlements from ERISA’s prohibited transaction provisions? ��3-14

Chapter 4 Fiduciary Duties Under ERISA

Definition of Fiduciary ��4-2

Q 4�1 What does it mean to be a “fiduciary” of an ERISA plan? ��4-2

Becoming a Fiduciary ��4-2

Q 4�2 How does a person or an entity become a “fiduciary” of an ERISA plan? ��4-2

Q 4�2�1 What makes someone a “named” or “designated” fiduciary? ��4-3

Q 4�2�2 What does it mean to function as a fiduciary by exercising discretionary authority or control? ��4-3

Extent of Fiduciary Role ��4-4

Q 4�3 When is someone a fiduciary for certain purposes or particular actions? ��4-4

Q 4�4 How many fiduciaries must an employee benefit plan have? ��4-5

Fiduciary Responsibilities in the ERISA Context ��4-5

Q 4�5 For what is a fiduciary responsible? ��4-5

Fiduciary Liability ��4-6

Q 4�6 For what may a fiduciary be held liable? ��4-6


xviii

Termination of Fiduciary Status��4-6

Q 4�7 How can a named or functional fiduciary terminate its fiduciary status? ��4-6

Q 4�7�1 How does a fiduciary formally terminate its fiduciary status? ��4-7

Q 4�7�2 How does a fiduciary unequivocally terminate its fiduciary status? ��4-7

Q 4�7�3 How does a fiduciary ensure that its resignation or termination of fiduciary status is in compliance with plan documents?��4-8

Fiduciary Obligations Post-Resignation or Termination��4-8

Q 4�7�4 What are a fiduciary’s obligations after resigning or terminating its fiduciary status? ��4-8

Q 4�7�5 Must a resigning fiduciary appoint a successor fiduciary? ��4-8

Q 4�7�6 Must a resigning fiduciary disclose material information necessary for the protection of the plan upon termination? ��4-9

Q 4�7�7 Must a resigning fiduciary investigate its successor prior to termination? ��4-9

Termination of Informal Fiduciaries ��4-10

Q 4�8 How does a fiduciary terminate its fiduciary status arising from the performance of fiduciary functions? ��4-10

Waiver/Delegation of Fiduciary Responsibility ��4-10

Q 4�9 Can fiduciary responsibility be waived? ��4-10Q 4�10 Can fiduciary responsibility be delegated? ��4-11

Q 4�10�1 Does the fiduciary have ongoing responsibilities with respect to these delegations? ��4-11

Fiduciary Duties ��4-12

Duty of Loyalty ��4-12

Q 4�11 What does it mean to be a fiduciary with a duty of loyalty to plan beneficiaries under ERISA? ��4-12

Q 4�11�1 What is the standard of loyalty required of fiduciaries? ��4-12

Q 4�11�2 Can a fiduciary have interests adverse to those of plan beneficiaries? ��4-13

Q 4�11�3 Can an employer-trustee invest trust assets in its own securities? ��4-13

Table of Contents

xix

Q 4�11�4 Can a fiduciary with a conflicting interest ever make decisions that are adverse to the interests of the beneficiaries? ��4-13

Q 4�11�5 To what extent do fiduciary duties apply during plan creation and amendment?��4-14

Q 4�11�6 To what extent is a plan service provider’s negotiation of its service agreement with the plan a fiduciary function? ��4-15

Duty to Disclose Complete and Accurate Information ��4-16

Q 4�12 What is the duty to disclose information and avoid misrepresentations? ��4-16

Q 4�12�1 What is “material information”? ��4-17Q 4�12�2 Does the duty to disclose information extend to

future plans or plan amendments? ��4-17Q 4�12�3 Is the duty to disclose violated if no plan participant

specifically requests the information in question? ��4-18

Q 4�12�4 What information does a fiduciary not have to disclose? ��4-19

Q 4�12�5 What relief is available to plan beneficiaries if this duty is violated? ��4-19

Duty to Manage Assets in the Interests of Participants and Beneficiaries ��4-19

Q 4�13 What is the duty to manage plan funds in the interests of participants and beneficiaries? ��4-19

Q 4�13�1 Can a fiduciary ever benefit personally from investment decisions made for the plan beneficiaries? ��4-20

Q 4�13�2 What should a fiduciary consider when making investment decisions? ��4-20

Duty of Prudence/Duty of Care ��4-20

Q 4�14 What is the duty of prudence? ��4-20Q 4�14�1 How do courts interpret the duty of prudence? ��4-21

Duty to Invest Prudently/Duty to Investigate ��4-21

Q 4�14�2 What is the duty to invest prudently and how does it relate to the duty to investigate? ��4-21

Q 4�14�3 How far must a fiduciary go to satisfy the duty to investigate? ��4-22


xx

Q 4�14�4 To what extent can a fiduciary rely on expert assistance? ��4-22

Q 4�14�5 To what extent can a fiduciary rely on non-experts? ��4-23

Q 4�14�6 How do courts assess the prudence of an investment? ��4-24

Q 4�14�7 Do fiduciaries have an ongoing duty to monitor the prudence of each investment? ��4-24

Q 4�14�8 How do courts evaluate the prudence of loans? ��4-24Q 4�14�9 How do courts determine prudent management of

Employee Stock Ownership Plans? ��4-25Q 4�14�10 May a fiduciary decide to invest in the securities of

the plan’s sponsor? ��4-25Q 4�14�11 What are the obligations of a fiduciary with

respect to sell-back options? ��4-26Q 4�14�12 What qualifies as prudent purchasing of

annuities in connection with plan termination?��4-26

Duty to Diversify ��4-27

Q 4�15 What is the duty to diversify? ��4-27Q 4�15�1 What is the purpose of the duty to diversify? ��4-28Q 4�15�2 How can violations of the duty to diversify

be challenged? ��4-28Q 4�15�3 What assets are subject to the duty to diversify? ��4-28Q 4�15�4 Is the final distribution of assets of a plan

subject to the duty to diversify? ��4-29Q 4�15�5 Are investments in employer securities, including

employee stock ownership plans (ESOPs), subject to the duty to diversify? ��4-29

Q 4�15�6 Are annuities subject to the duty to diversify? ��4-29Q 4�15�7 Are real estate and mortgages subject

to the duty to diversify? ��4-29Q 4�15�8 What is the scope of the duty to diversify? ��4-30Q 4�15�9 In a claim for breach of the duty to diversify,

what is the plaintiff’s burden? ��4-30Q 4�15�10 In defending a claim for breach of this duty,

what is the defendant’s burden? ��4-30

Duty to Act in Accordance with Plan Documents ��4-31

Q 4�16 What is the duty to act in accordance with the documents and instruments governing the plan? ��4-31

Table of Contents

xxi

Q 4�16�1 In what circumstances have courts found that the duty was violated? ��4-31

Q 4�16�2 When a court finds that the duty to comply with plan documents was violated, what types of damages are available? ��4-32

Q 4�16�3 How has this duty been construed by courts in claims for improper denial of benefits? ��4-32

Q 4�16�4 Does this duty change if the plan documents and other ERISA provisions conflict? ��4-33

Q 4�16�5 If a fiduciary violates other ERISA duties but acts in accordance with the documents and instruments governing the plan, has he violated the duty of loyalty? ��4-33

Q 4�16�6 What should a fiduciary do if the plan documents contain provisions that partially conflict with an ERISA provision?��4-34

Q 4�16�7 How have courts construed language in plan documents granting fiduciaries discretionary authority? ��4-34

Q 4�16�8 Is a grant of discretionary authority in unincorporated trust agreements or other instruments sufficient? ��4-34

Q 4�16�9 How have courts construed a fiduciary’s authority to interpret and apply rules promulgated by the fiduciary? ��4-34

Q 4�16�10 What is a fiduciary’s authority to interpret and define ambiguous terms in the plan document? ��4-35

Q 4�16�11 What actions do not fall within the duty to comply with plan documents?��4-35

Q 4�16�12 Which documents and instruments govern the plan? ��4-35

Q 4�16�13 Can an employee recover promised benefits even if the promise was not contained in a governing document? ��4-36


xxii

Chapter 5 Breach of Fiduciary Duty Litigation

Breach of Fiduciary Duty: In General ��5-2

Q 5�1 What actions are available for breach of fiduciary duty under ERISA? ��5-2

Who May Bring Claim ��5-3

Q 5�2 Who may bring a claim for breach of fiduciary duty? ��5-3Q 5�2�1 Who is a “participant”? ��5-3Q 5�2�2 Who is a “beneficiary”?��5-4Q 5�2�3 Who is a “fiduciary”?��5-4

Who May Recover ��5-5

Q 5�3 Who may recover for breach of fiduciary duty? ��5-5

What Remedies Are Available ��5-5

Q 5�4 What remedies are available for a breach of fiduciary duty under ERISA? ��5-5

Q 5�4�1 Are compensatory damages recoverable? ��5-6Q 5�4�2 Are punitive damages recoverable? ��5-6Q 5�4�3 Is restitution available? ��5-6Q 5�4�4 Can a fiduciary’s transaction in breach of its

fiduciary duties be canceled or avoided? ��5-7Q 5�4�5 Can the court impose a constructive trust? ��5-7Q 5�4�6 Is an injunction available? ��5-8

Statute of Limitations ��5-8

Q 5�5 What is the applicable statute of limitations? ��5-8

What Court Has Jurisdiction ��5-9

Q 5�6 In what court can an action for breach of fiduciary duty be filed? ��5-9

Q 5�7 Is a jury trial available? ��5-10

Section 502(a)(2) Actions ��5-10

Q 5�8 When can a § 502(a)(2) action on behalf of the plan be brought? ��5-10

Q 5�8�1 Who may bring a § 502(a)(2) action? ��5-10Q 5�8�2 Who is a proper defendant in a § 502(a)(2) action? ��5-10Q 5�8�3 What relief is available in a § 502(a)(2) action? ��5-10

Table of Contents

xxiii

Section 502(a)(3) Actions ��5-11

Q 5�9 When can a § 502(a)(3) action seeking individual relief be brought? ��5-11

Q 5�9�1 Who may seek individual relief under a § 502(a)(3) action? ��5-11

Q 5�9�2 Who is a proper defendant in a § 502(a)(3) action? ��5-11Q 5�9�3 What relief is available in a § 502(a)(3) action? ��5-11Q 5�9�4 What is “other appropriate equitable relief”? ��5-12

Impact of Other ERISA Provisions on § 502(a)(3) Claims ��5-12

Q 5�9�5 What if relief is available under other ERISA provisions? ��5-12

Chapter 6 Stock Drop Litigation

Stock Drop Suits: In General ��6-2

Q 6�1 What are ERISA “stock drop suits”? ��6-2

EIAPs and ESOPs Defined ��6-2

Q 6�2 Which types of ERISA plans are permitted to invest in employer stock? ��6-2

Fiduciary Duties ��6-3

Q 6�3 Which fiduciary duties apply to fiduciaries of EIAPs and ESOPs? ��6-3

Duty of Loyalty ��6-4

Q 6�4 What is the duty of loyalty? ��6-4Q 6�4�1 When does the duty of loyalty apply? ��6-4Q 6�4�2 What facts do plaintiffs typically allege are

indicative of a breach of the duty of loyalty? ��6-5

Duty of Prudence ��6-6

Q 6�5 What is the duty of prudence? ��6-6Q 6�5�1 What must a plaintiff show to establish a

breach of the duty of prudence? ��6-6Q 6�5�2 What must a plaintiff plead to state a

claim that a fiduciary has acted imprudently? ��6-7Q 6�5�3 Can a plaintiff establish a breach of the duty of

prudence against a fiduciary based on failure to diversify? ��6-8


xxiv

Duty of Prudence and Duty of Loyalty Combined ��6-8

Q 6�6 What obligations do the duties of prudence and loyalty encompass in stock drop litigation? ��6-8

Duty to Investigate ��6-9

Q 6�7 What is the duty to investigate and when does it arise? ��6-9Q 6�7�1 When does an ERISA fiduciary have a duty to

investigate company affairs affecting stock value? ��6-9Q 6�7�2 What does the duty to investigate investment

decisions entail? ��6-10

Duty to Monitor ��6-11

Q 6�8 What is the duty to monitor? ��6-11Q 6�8�1 How broad is the duty to monitor? ��6-11Q 6�8�2 What conduct does the duty to monitor require? ��6-12

Duty to Disclose ��6-13

Q 6�9 What is the duty to disclose? ��6-13Q 6�9�1 How does a claim for breach of the duty to

disclose arise? ��6-13Q 6�9�2 When does an individual act as a fiduciary? ��6-14Q 6�9�3 How broad is the scope of the duty to disclose? ��6-15

Available Defenses ��6-16

Q 6�10 What defenses are available to defendants in stock drop litigation cases? ��6-16

Chapter 7 ESOP Litigation

ESOP Defined ��7-2

Q 7�1 What is an ESOP? ��7-2

Causes of Action Involving ESOPs ��7-2

Q 7�2 What are common types of litigation that involve ESOPs? ��7-2Q 7�2�1 What do plaintiffs typically allege in a claim that

an ESOP did not purchase stock for adequate consideration? ��7-3

Q 7�2�2 What claims do plaintiffs typically assert in “stock drop” litigation involving an ESOP? ��7-5

Table of Contents

xxv

Prohibited Transactions ��7-5

Q 7�3 What is a “prohibited transaction”? ��7-5

Adequate Consideration ��7-6

Q 7�4 What is “adequate consideration”? ��7-6

Good Faith ��7-7

Q 7�5 What does “good faith” mean? ��7-7

Investing in Employer Stock ��7-7

Q 7�6 How are pension plans able to invest in employer securities in light of the prohibited transaction restrictions? ��7-7

Q 7�6�1 Is an ESOP required to provide diversification options to a plan participant as that participant nears retirement? ��7-7

Q 7�6�2 Can an ESOP own assets other than the employer’s stock? ��7-8

Q 7�6�3 Can an ESOP sell the employer’s stock? ��7-9

When Is Investing in Employer Stock Imprudent? ��7-10

Q 7�7 How do courts determine whether it is imprudent to buy, sell, or continue investing in employer stock? ��7-10

Q 7�7�1 Does a significant downward trend in the employer’s stock render it imprudent for a fiduciary to continue to invest in, or offer as an option investment in, the employer’s stock? ��7-10

Q 7�8 With respect to public companies, is the fiduciary required to consider any factors beyond the public price when making an investment decision? ��7-10

Q 7�9 What circumstances may result in a duty to sell the employer’s stock? ��7-11

Indemnification-Related Claims ��7-12

Q 7�10 What other claims are typically brought related to ESOPs? ��7-12Q 7�10�1 Under ERISA, how may a fiduciary be protected

from liability for plan losses?��7-12Q 7�10�2 Have courts rejected indemnification claims

made by ESOP fiduciaries? ��7-13


xxvi

Chapter 8 Cash Balance Plan Litigation

Cash Balance Plan Defined ��8-2

Q 8�1 What is a cash balance plan? ��8-2

Converting from Traditional Pension to Cash Balance Plan ��8-3

Q 8�2 What are the potential litigation risks posed by moving from a traditional pension plan to a cash balance plan? ��8-3

Conversion Claim Under ERISA ��8-4

Q 8�3 What are the most common ERISA claims relating to cash balance plans? ��8-4

Age Discrimination Claims ��8-4

Q 8�4 What are courts doing with ERISA age discrimination claims against employers that convert to cash balance plans? ��8-4

Pension Protection Act of 2006 ��8-5

Q 8�5 What legislative action has been taken to combat anti-discrimination claims arising from cash balance plan conversions? ��8-5

Anti-Cutback Provisions ��8-6

Q 8�6 How does the anti-cutback rule apply to conversions to cash balance plans? ��8-6

Wearaway ��8-6

Q 8�7 What is wearaway and what are its effects? ��8-6Q 8�7�1 What are the statutory and regulatory requirements

related to wearaway? ��8-7Q 8�7�2 How are courts treating wearaway claims by

plaintiffs? ��8-7Q 8�7�3 What is the interplay between wearaway and

ERISA’s anti-cutback rule? ��8-8

Whipsaw Calculations ��8-9

Q 8�8 What is the “whipsaw” calculation and how does it apply to cash balance plans? ��8-9

Q 8�8�1 What are courts doing with the “whipsaw” dilemma? ��8-10

Table of Contents

xxvii

Q 8�8�2 What are the remedies for improper whipsaw calculations? ��8-11

Q 8�8�3 What is the “normal retirement age” for purposes of the whipsaw calculation? ��8-11

Chapter 9 Prohibited Transaction Litigation

Prohibited Transaction Defined ��9-2

Q 9�1 What is a prohibited transaction? ��9-2

Party in Interest Defined ��9-3

Q 9�2 Who is considered a party in interest? ��9-3

Kinds of Prohibited Transactions ��9-3

Q 9�3 Which types of transactions between a plan and a party in interest are prohibited? ��9-3

Q 9�4 Is a transaction still prohibited if a party-in-interest relationship ends before the dispersal of funds under a loan agreement? ��9-4

Level of Intent Required ��9-5

Q 9�5 What level of intent is required for a fiduciary to be liable for a prohibited transaction? ��9-5

Q 9�5�1 What additional level of intent is required for a fiduciary to be liable for transferring plan assets for the benefit of a party in interest? ��9-5

Impact of Third-Party Involvement ��9-5

Q 9�6 Can a prohibited transaction occur when a third party is involved? ��9-5

Self-Dealing Defined ��9-6

Q 9�7 What constitutes a prohibited “self-dealing” transaction by a plan fiduciary? ��9-6

Q 9�8 Does good faith, legitimate business purpose or lack of harm cure an otherwise prohibited transaction? ��9-7


xxviii

Prohibited Transaction Exemptions ��9-8

Q 9�9 Are there any exemptions from ERISA’s prohibited transaction bar? ��9-8

Statutory Exemption ��9-8

Q 9�10 What are statutory exemptions? ��9-8Q 9�10�1 What types of prohibited transactions are subject

to statutory exemptions? ��9-8Q 9�10�2 What is considered a reasonable contract or

arrangement entitled to relief under the statutory exemption?��9-8

Class Exemption ��9-9

Q 9�11 What are class exemptions? ��9-9Q 9�11�1 What types of prohibited transactions are

subject to class exemptions? ��9-9

Individual Exemption ��9-9

Q 9�12 What are individual exemptions? ��9-9

Pleading an Exemption ��9-10

Q 9�13 Must a plaintiff plead the absence of prohibited transaction exemptions? ��9-10

Personal Liability ��9-10

Q 9�14 How may fiduciaries be held personally liable for prohibited transactions under ERISA? ��9-10

Penalties ��9-10

Q 9�15 What penalties can the Department of Labor and the Internal Revenue Service assess for non-exempt prohibited transactions? ��9-10

Q 9�16 What private remedies are available for a violation of the prohibited transaction provisions that cause a loss of money or assets? ��9-11

Q 9�17 What private remedies are available for a violation of the prohibited transaction provisions that do not cause a loss of money or assets? ��9-11

Table of Contents

xxix

Chapter 10 401(k) Fee Litigation


Q 10�1 What is 401(k) fee litigation? ��10-2Q 10�1�1 What is 403(b) fee litigation? ��10-3

Q 10�2 Who are the typical plaintiffs in 401(k) fee litigation? ��10-3

Establishing Plaintiff’s Standing ��10-3

Q 10�3 Do plaintiffs need to establish standing in fee litigation cases? ��10-3

Q 10�3�1 How do plaintiffs establish standing in fee litigation cases? ��10-3

Q 10�3�2 Can a named plaintiff establish standing on behalf of a class of past or future participants? ��10-4

Defendants ��10-4

Q 10�4 Who are the typical defendants in 401(k) fee litigation? ��10-4

Corporate Defendants ��10-4

Q 10�4�1 Who are typical corporate defendants in 401(k) fee litigation? ��10-4

Individual Defendants ��10-5

Q 10�4�2 Who are typical individual defendants in 401(k) fee litigation? ��10-5

Q 10�4�3 What particular issues relating to board committee and officer defendants arise in 401(k) fee litigation? ��10-5

Service Provider Defendants and Others ��10-5

Q 10�4�4 Who are typical service provider defendants in 401(k) fee litigation? ��10-5

Q 10�4�5 What particular issues relating to service provider defendants arise in 401(k) fee litigation? ��10-6

Kinds of Claims ��10-6

Q 10�5 What are the typical claims brought in fee litigation? ��10-6

Excessive Fees ��10-6

Q 10�5�1 How have plaintiffs alleged that defendants paid excessive fees? ��10-6


xxx

Failure to Capture Revenue Streams ��10-7

Q 10�5�2 How have plaintiffs alleged that defendants failed to capture revenue streams? ��10-7

Imprudent Decision-Making ��10-8

Q 10�5�3 How have plaintiffs alleged claims for imprudent decision-making? ��10-8

Prohibited Transactions and Breach of Duty of Loyalty ��10-8

Q 10�5�4 How have plaintiffs alleged that defendants engaged in prohibited transactions and breached the duty of loyalty? ��10-8

Failure to Disclose ��10-9

Q 10�5�5 How do plaintiffs bring claims for failure to disclose or misrepresentation of excessive fees? ��10-9

Excessive Cash in Company Stock Fund��10-9

Q 10�5�6 How have plaintiffs framed claims against defendants for holding excessive cash positions in company stock funds? ��10-9

Kinds of Relief ��10-10

Q 10�6 What type of relief do plaintiffs seek in fee litigation cases? ��10-10

Legal Standards ��10-11

Excessive Fees ��10-11

Q 10�7 What standards do courts use in determining if defendants paid excessive fees? ��10-11

Failure to Disclose ��10-12

Q 10�8 How have courts adjudicated claims alleging the failure to disclose certain fee arrangements? ��10-12


Q 10�9 What is the applicable statute of limitations in fee litigation cases? ��10-13

Safe Harbor ��10-13

Q 10�10 Does ERISA’s safe harbor provision apply in fee litigation cases? ��10-13

Table of Contents

xxxi

Chapter 11 Litigation to Recover Benefits Due Under a Plan


Q 11�1 Can a plan participant file a civil claim seeking benefits under an ERISA plan? ��11-2

Q 11�1�1 Under what circumstances do such claims typically arise? ��11-3

Q 11�1�2 What kinds of relief are available to a successful claimant? ��11-3

Who Can Bring a Claim ��11-3

Q 11�2 Who can bring claims for benefits? ��11-3Q 11�2�1 Who is a “participant”? ��11-3Q 11�2�2 Who is an “employee”? ��11-4Q 11�2�3 Who is a “beneficiary”?��11-4Q 11�2�4 May benefits available under an ERISA plan be

assigned, and does an assignee have standing to bring a claim for benefits? ��11-4

Claim Jurisdiction ��11-5

Q 11�3 Which provision discusses jurisdiction and venue for claims for benefits? ��11-5

Exhaustion of Claims Review Required��11-5

Q 11�4 Does ERISA require exhaustion of claims review procedures as a prerequisite to bringing a claim for benefits? ��11-5

Q 11�4�1 Are there any exceptions to the exhaustion requirement? ��11-6

Insurance ��11-6

Q 11�5 Does ERISA address a participant’s or beneficiary’s entitlement to insurance proceeds? ��11-6

Additional Claims��11-6

Q 11�6 What other kinds of claims may accompany a claim seeking benefits? ��11-6

Who May Be Sued ��11-7

Q 11�7 Who may be sued in an action seeking ERISA benefits? ��11-7Q 11�7�1 May a party other than an ERISA plan properly

be named a defendant in a claim for benefits action? ��11-7


xxxii

Q 11�7�2 What is a “plan administrator”? ��11-8Q 11�7�3 May a party other than the designated plan

administrator be sued as a de facto plan administrator in a benefits action? ��11-8

Damages Available ��11-9

Q 11�8 What damages are available to a claimant in a benefits action? ��11-9

Q 11�8�1 Are claimants also entitled to additional relief, including consequential and punitive damages? ��11-9

Q 11�8�2 Have district courts subsequent to Ingersoll-Rand Co. expanded the scope of available remedies? ��11-10

Q 11�8�3 What kinds of relief are included in the equitable relief available in a benefits action? ��11-11

Attorney’s Fees ��11-11

Q 11�9 In a benefits action, under what circumstances is a party entitled to an award of costs and attorney’s fees? ��11-11

Q 11�9�1 Do courts consider whether the party has prevailed in the litigation in deciding to award attorney’s fees? ��11-12

Q 11�9�2 Do courts consider the degree of bad faith or frivolity in deciding whether to award attorney’s fees? ��11-12

Kinds of Actionable Pension Plans ��11-13

Q 11�10 What type of retirement income benefits can form the basis of a claim for benefits under ERISA? ��11-13

Defined Benefit Plan ��11-13

Q 11�11 What is a defined benefit plan? ��11-13Q 11�11�1 What are the characteristics of a

defined benefit plan? ��11-14Q 11�11�2 When can a participant or beneficiary bring a

claim for benefits under a defined benefit plan? ��11-15

Defined Contribution Plan ��11-15

Q 11�12 What is a defined contribution plan? ��11-15Q 11�12�1 What are the characteristics of a defined

contribution plan? ��11-16Q 11�12�2 When can a beneficiary bring a claim for benefits

under a defined contribution plan? ��11-17

Table of Contents

xxxiii

Employee Welfare Benefit Plan ��11-17

Q 11�13 What type of welfare benefits can form the basis of a claim for benefits under ERISA? ��11-17

Standards of Review—In General ��11-18

Q 11�14 What standards of review do courts apply to an administrator’s decision denying benefits? ��11-18

De Novo vs. Abuse of Discretion ��11-18

Q 11�14�1 How do courts determine which standard of review applies to a particular administrative decision? ��11-18

Q 11�14�2 How do courts determine whether a benefit plan gives the administrator discretionary authority? ��11-19

Q 11�14�3 Must the plan contain an express grant of discretion to warrant deference to the administrator’s decision? ��11-19

Q 11�14�4 What must a plan say to confer discretion on the plan administrator?��11-20

Q 11�14�5 Must discretion be granted to a plan administrator or fiduciary in a particular plan document? ��11-21

Factors Considered When Applying De Novo Standard ��11-22

Q 11�15 What factors do courts take into consideration when applying a de novo standard of review? ��11-22

Q 11�16 What determinations are subject to de novo review by courts? ��11-22

Interpretive Principles ��11-23

Q 11�17 What interpretive principles do courts use when interpreting ERISA plan documents? ��11-23

Q 11�17�1 Can courts consider extrinsic evidence when construing plan language? ��11-24

Factors Considered When Applying Abuse of Discretion Standard ��11-24

Q 11�18 When do courts apply an abuse of discretion standard of review to an administrator’s or fiduciary’s decision? ��11-24

Q 11�18�1 What factors do courts consider when applying the abuse of discretion standard of review? ��11-25

Q 11�18�2 What is the scope of evidence considered under the abuse of discretion standard of review? ��11-25

Q 11�18�3 When can a court remand a case for further administrative review? ��11-26


xxxiv

Standard to Sustain a Denial of Benefits ��11-26

Q 11�18�4 What showing do courts require to sustain a denial of benefits? ��11-26

Q 11�18�5 What standard does a court apply in a deferential review of a plan administrator’s decision? ��11-26

Q 11�18�6 When is a plan administrator’s decision “reasonable”? ��11-27

Q 11�18�7 How does a court evaluate the “reasonableness” of a plan administrator’s decision? ��11-27

Impact of Conflict of Interest ��11-29

Q 11�18�8 What impact does a conflict of interest have on the evaluation of a fiduciary’s duties? ��11-29

Q 11�18�9 What constitutes a conflict of interest? ��11-29Q 11�18�10 How does a conflict of interest impact the

standard of review applied by the court? ��11-30

Sliding Scale Standard ��11-31

Q 11�18�11 What is the sliding scale standard? ��11-31Q 11�18�12 What is the modified sliding scale standard? ��11-31

Reasonableness Approach ��11-32

Q 11�18�13 What is the reasonableness approach? ��11-32

“Treating Physician Rule” in Review of Social Security Benefit Determinations ��11-33

Q 11�19 Do courts impose a “treating physician rule” on administrators? ��11-33

Anti-Cutback Litigation ��11-34

Q 11�20 What is anti-cutback litigation? ��11-34Q 11�20�1 What is ERISA’s anti-cutback provision? ��11-34Q 11�20�2 How is a claim for violation of ERISA’s

anti-cutback provision pled? ��11-35Q 11�20�3 Who are proper parties in an anti-cutback claim? ��11-35Q 11�20�4 What remedies are available for violation of

ERISA’s anti-cutback provision?��11-35

Table of Contents

xxxv

Chapter 12 Multiemployer Plan Litigation


Q 12�1 What is a multiemployer plan? ��12-2Q 12�1�1 What factors are relevant to determining whether a

multiemployer plan is established for a substantial business purpose? ��12-3

Q 12�1�2 What kinds of plans may be structured as multiemployer plans? ��12-3

Q 12�2 How are multiemployer plans controlled and administered? ��12-4

Possible Claims ��12-4

Q 12�3 What claims may be brought against a participating employer in a multiemployer plan? ��12-4

Governing Statutes ��12-4

Q 12�4 Which statutes govern multiemployer plans? ��12-4

Funding Requirements ��12-5

Q 12�5 How are multiemployer pension plans funded? ��12-5Q 12�5�1 What is the effect of the MPRA on severely

underfunded plans? ��12-6

Impact of LMRA on Multiemployer Plans ��12-7

Q 12�6 What requirements does the Labor Management Relations Act impose on multiemployer plans? ��12-7

Impact of ERISA on Multiemployer Plans ��12-7

Q 12�7 How does ERISA apply to multiemployer plans? ��12-7

Impact of Employer Withdrawal ��12-8

Q 12�8 What is the result of an employer’s exit from a plan? ��12-8Q 12�8�1 What types of withdrawal exist? ��12-8Q 12�8�2 What is complete withdrawal? ��12-9Q 12�8�3 What is partial withdrawal? ��12-9Q 12�8�4 Does the suspension of contributions constitute

withdrawal? ��12-9Q 12�8�5 Is the sale of stock considered an employer

withdrawal? ��12-9


xxxvi

Plan Sponsor Response ��12-10

Q 12�9 How does the plan sponsor respond to an employer’s withdrawal? ��12-10

Q 12�9�1 How is the employer’s withdrawal liability calculated? ��12-10

Employer Withdrawal Liability ��12-11

Q 12�10 How does an employer respond to the plan sponsor’s imposed withdrawal liability? ��12-11

Mandatory Arbitration ��12-11

Q 12�11 Are withdrawal disputes subject to mandatory arbitration? ��12-11

Q 12�11�1 What deference is given to the plan sponsor’s decision during arbitration? ��12-12

Withdrawing Employer’s Payment Schedule ��12-13

Q 12�12 When must the withdrawing employer begin to make payments? ��12-13

Q 12�12�1 Who is responsible for liability payments? ��12-13

Availability of Judicial Review ��12-14

Q 12�13 What judicial review is available? ��12-14

Collection Actions ��12-14

Q 12�13�1 What remedies exist for collecting contributions? ��12-14

Private Causes of Action ��12-15

Q 12�14 What private causes of action exist for plan participants and beneficiaries? ��12-15

Chapter 13 Managed Care Plan Litigation

In General—Kinds of Managed Care Plans ��13-2

Q 13�1 What is an ERISA managed care plan? ��13-2Q 13�1�1 What is utilization review? ��13-2Q 13�1�2 What advantages do managed care plans offer

over traditional benefit plans or fee-for-service arrangements? ��13-3

Table of Contents

xxxvii

Q 13�1�3 What are some common criticisms of managed care plans? ��13-3

When ERISA Liability Occurs ��13-3

Fiduciary Obligation ��13-3

Q 13�2 When are employer-sponsors of managed care plans subject to ERISA liability? ��13-3

Q 13�2�1 When is an employer-sponsor of a managed care plan also considered the plan administrator? ��13-4

Q 13�2�2 Can an employer sponsoring a managed care plan be liable as an ERISA fiduciary if the employer is not formally designated as the plan administrator? ��13-5

Q 13�2�3 For what acts is an employer who is also a plan administrator subject to liability as an ERISA fiduciary? ��13-5

Other ERISA Obligations ��13-6

Q 13�3 Under what circumstances may an employer-administrator have obligations to plan beneficiaries under ERISA? ��13-6

When Denying or Terminating Coverage ��13-6

Q 13�4 What are an employer-administrator’s obligations when denying or terminating healthcare coverage? ��13-6

Q 13�4�1 What information should be included in a denial/termination notice? ��13-7

Q 13�4�2 What happens if a qualified beneficiary does not receive adequate notice? ��13-7

When Considering Amendments to a Managed Care Plan ��13-8

Q 13�5 What are an employer-administrator’s obligations when considering amendments to a managed care plan? ��13-8

When Terminating an Employee ��13-8

Q 13�6 What are an employer-administrator’s obligations upon termination of employment? ��13-8

Q 13�6�1 What is COBRA? ��13-8Q 13�6�2 What is a “qualifying event”? ��13-9Q 13�6�3 How should a discharged employee be notified

of his or her COBRA rights? ��13-9Q 13�6�4 What information should a COBRA notice contain? ��13-9Q 13�6�5 What happens if a qualified beneficiary does

not receive adequate notice? ��13-11


xxxviii

Standard for Court Review ��13-12

Q 13�7 Do courts apply more stringent standards when reviewing decisions made by employers acting as plan administrators, as opposed to decisions made by non-administrator employers? ��13-12

Employer Liability for Actions of Plan or Administrator ��13-12

Q 13�8 Can a non-administrator employer be held liable for the actions or decisions of the managed care plan or administrator chosen by the employer? ��13-12

Q 13�8�1 Is an employer-sponsor acting as an ERISA fiduciary when selecting a managed care plan? ��13-13

Q 13�8�2 Does ERISA protect an employer-sponsor alleged to be liable for the actions of a managed care plan or administrator? ��13-13

Q 13�8�3 How can an employer-sponsor protect itself against possible liability for the actions of a managed care plan or administrator? ��13-14

Chapter 14 Discrimination and Interference with Benefits Rights Litigation


Q 14�1 What provision of ERISA permits claims for discrimination or interference with benefits? ��14-2

Plaintiffs/Defendants ��14-3

Q 14�2 Who are the appropriate parties to a suit under § 510? ��14-3Q 14�2�1 Who are proper defendants in an action

under § 510? ��14-3Q 14�2�2 Who is a proper plaintiff in an action

under § 510? ��14-4

Prohibited Actions Under § 510 ��14-5

Q 14�3 What types of conduct are prohibited by ERISA § 510? ��14-5

Table of Contents

xxxix

Preempted State Actions ��14-6

Q 14�4 Are state law employment actions relating to benefits under an ERISA plan preempted by ERISA? ��14-6


Q 14�5 What is the applicable statute of limitation for a § 510 claim? ��14-7

Elements of a § 510 Action ��14-8

Q 14�6 What are the elements of an action under ERISA § 510? ��14-8

Direct Evidence ��14-9

Q 14�6�1 What is the direct evidence framework? ��14-9

Indirect Evidence ��14-9

Q 14�6�2 What is the indirect or McDonnell Douglas framework?��14-9

Elements of a Prima Facie Case ��14-10

Q 14�6�3 How does a plaintiff establish a prima facie case? ��14-10

Rebutting the Presumption ��14-10

Q 14�6�4 How does a defendant rebut the initial presumption of discrimination? ��14-10

Rebutting the Rebuttal ��14-11

Q 14�6�5 How does the plaintiff show that a proffered legitimate non-discriminatory reason is pretextual? ��14-11

Available Remedies ��14-13

Q 14�7 What remedies are available to a plaintiff under ERISA § 510? ��14-13

Other Related Federal Statutes ��14-13

Q 14�8 How does ERISA’s anti-retaliation provision relate to other federal discrimination statutes? ��14-13

Q 14�8�1 How does ERISA § 510 interact with the ADEA? ��14-14Q 14�8�2 How does ERISA § 510 interact with the ADA? ��14-15


xl

Chapter 15 Litigation of Claims Arising Under Federal Common Law

Common Law Impacts on ERISA Actions ��15-2

Q 15�1 How does federal common law provide guidance to courts applying ERISA? ��15-2

Q 15�2 What justifies the federal judiciary’s power to develop federal common law, preempting state law, in ERISA cases? ��15-2

Trust, Agency and Contract Law ��15-3

Q 15�3 What principles of law have courts looked to in developing ERISA federal common law? ��15-3

Q 15�3�1 How has trust law played a role in the development of ERISA federal common law? ��15-3

Q 15�3�2 How has agency law played a role in the development of ERISA federal common law? ��15-3

Q 15�3�3 How has contract law played a role in the development of ERISA federal common law? ��15-4

Common Law Theories Raised in ERISA Actions ��15-4

Q 15�4 What federal common law theories of liability do ERISA participants or beneficiaries most frequently raise? ��15-4

Restitution ��15-4

Q 15�5 Is a claim for restitution a permissible federal common law theory? ��15-4

Q 15�5�1 Are claims for restitution “at law” permissible? ��15-5Q 15�5�2 What distinguishes restitution “at law”

from equitable restitution? ��15-5Q 15�5�3 May non-fiduciary employers recover funds

mistakenly contributed to ERISA plans under a theory of restitution? ��15-5

Q 15�5�4 What factors do courts consider in balancing equities to decide whether to order restitution in a mistaken contribution case? ��15-7

Rescission ��15-7

Q 15�6 Is a claim for rescission a permissible federal common law theory? ��15-7

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Indemnification and Contribution ��15-8

Q 15�7 Are claims for indemnification or contribution permissible federal common law theories? ��15-8

Estoppel ��15-8

Q 15�8 Is a claim for estoppel a permissible federal common law theory? ��15-8

Q 15�8�1 Can an estoppel theory be used to enforce oral representations about a plan? ��15-9

Q 15�8�2 Can an estoppel theory be used to enforce written representations about a plan? ��15-9

Q 15�8�3 Is a claim for estoppel treated differently in the context of a welfare benefit plan versus a pension plan? ��15-10

Prejudgment Interest ��15-10

Q 15�9 Is a claim for prejudgment interest a permissible federal common law theory? ��15-10

Q 15�9�1 Are pension beneficiaries entitled to interest for denial of benefits where the benefits are later restored without resort to litigation? ��15-11

Waiver ��15-11

Q 15�10 Are principles of waiver permissible under federal common law? ��15-11

Standard of Review ��15-12

Q 15�11 What standard of review do courts apply when evaluating a plan administrator’s decision? ��15-12

Q 15�12 Does federal common law permit the parties to a welfare benefit plan to determine when benefits vest or terminate? ��15-12

Limitations on Use of Common Law ��15-13

Q 15�13 What are the limitations on the development and use of federal common law in ERISA cases? ��15-13

Q 15�13�1 Can courts develop federal common law that is inconsistent with ERISA’s language? ��15-13

Q 15�13�2 Can courts develop federal common law when ERISA is silent on an issue? ��15-14

Q 15�14 Do courts, by use of federal common law, permit legal remedies? ��15-14


xlii

Chapter 16 Affirmative Defenses to ERISA Claims


Q 16�1 What affirmative defenses are available to defend against an ERISA claim? ��16-2

Safe Harbor Provisions ��16-2

Q 16�2 What is the § 404(c) safe harbor provision? ��16-2Q 16�2�1 How does a plan qualify under § 404(c)? ��16-3Q 16�2�2 Does § 404(c) apply to a fiduciary’s decisions

about which options to offer? ��16-4

Delegation ��16-5

Q 16�3 Is a fiduciary’s delegation of a fiduciary function an affirmative defense to a breach of fiduciary duty claim based on the performance of that function? ��16-5

Defenses to § 406 Prohibited Transactions ��16-6

Q 16�4 What affirmative defenses apply when a fiduciary is accused of engaging in one of the prohibited transactions in ERISA § 406? ��16-6

Statutes of Limitations��16-7

Q 16�5 What is the statute of limitations period for an ERISA claim? ��16-7

Q 16�5�1 What is the statute of limitations period for an action for breach of fiduciary duty? ��16-7

Q 16�5�2 What is the statute of limitations period for an action for wrongful denial of benefits under § 502(a)(1)(B)? ��16-8

Q 16�5�3 What is the statute of limitations period for actions alleging interference with benefits in violation of § 510? ��16-8

Waiver of Claims��16-9

Q 16�6 Can an ERISA claim be waived? ��16-9

Standing to Sue ��16-11

Q 16�7 Who has standing to sue under ERISA? ��16-11

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Impact of Failure to Exhaust Administrative Remedies ��16-11

Q 16�8 Is failure to exhaust administrative remedies an affirmative defense to an ERISA claim? ��16-11

Chapter 17 Limitations on Actions Under ERISA

Conditioning Receipt of Benefits on Waiver of ERISA Rights ��17-2

Q 17�1 May employers condition the receipt of employee benefits on a waiver of ERISA rights and claims? ��17-2

Knowing and Voluntary ��17-2

Q 17�1�1 What factors determine the enforceability of a waiver of benefits? ��17-2

Q 17�1�2 What constitutes a knowing and voluntary waiver?��17-3Q 17�1�3 Is any single factor in the knowing and voluntary

test dispositive?��17-4

Form of Waiver ��17-4

Q 17�1�4 When can a participant waive his or her spouse’s rights to pension death benefits arising under an ERISA plan? ��17-4

Anti-Alienation Provision ��17-5

Q 17�1�5 Does ERISA’s anti-alienation provision bar waivers of pension benefits? ��17-5

Q 17�1�6 May employees waive prospective ERISA claims? ��17-5

Waiver of Future Claims ��17-5

Q 17�1�7 How do courts interpret the terms of a waiver? ��17-5

Form of Waiver ��17-6

Q 17�1�8 Can a party bring an ERISA claim after signing a waiver? ��17-6

Q 17�1�9 Can a party bring a claim on behalf of a plan after signing a waiver? ��17-6

Arbitration Provisions ��17-6

Q 17�2 Can an employer compel arbitration of employee benefits disputes? ��17-6

Q 17�2�1 What factors determine the enforceability of a mandatory arbitration policy? ��17-7


xliv

Statutes of Limitations��17-9

Benefits Claims ��17-9

Q 17�3 What is the statute of limitations for benefits claims? ��17-9Q 17�3�1 Is a contractual limitations period limiting the

time to bring a lawsuit benefits claim enforceable? ��17-9Q 17�3�2 What constitutes a “reasonable” limitations period? ��17-9

Breach of Fiduciary Claims ��17-10

Q 17�4 What is the statute of limitations for breach of fiduciary claims? ��17-10

Q 17�4�1 What constitutes actual knowledge for purposes of running the statute of limitations? ��17-10

Q 17�4�2 Is there a different statute of limitations in a case of fraud or concealment?��17-10

Q 17�4�3 Do federal equitable tolling principles apply? ��17-11

Chapter 18 Special Considerations for ERISA Litigation

Right to Jury Trial ��18-2

Q 18�1 Is there a statutory right to a jury trial under ERISA? ��18-2Q 18�1�1 How do courts determine if a plaintiff seeks a

legal or equitable remedy? ��18-2Q 18�1�2 Is a claim for money damages a legal remedy? ��18-2

Q 18�2 Does the right to a jury trial depend on which ERISA cause of action is being pled? ��18-3

Q 18�2�1 Is a jury trial available for a cause of action brought under ERISA § 502(a)(1)(B)? ��18-3

Q 18�2�2 What happens when a plaintiff brings ERISA claims and other claims that give rise to a jury right in the same lawsuit? ��18-4

Q 18�3 Is a jury trial available for a cause of action brought under ERISA § 502(a)(2)? ��18-4

Q 18�4 Is a jury trial available when the cause of action is brought under ERISA § 502(a)(3)? ��18-5

Attorney-Client Privilege ��18-5

Q 18�5 Does an attorney-client privilege exist between a plan fiduciary and an attorney who provides legal advice? ��18-5

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Q 18�6 Are there ERISA-specific limitations or exceptions to the attorney-client privilege or other situations where the privilege might not attach? ��18-6

Q 18�6�1 Is the fiduciary exception a waiver of the attorney-client privilege? ��18-7

Q 18�6�2 Are there limits on when the fiduciary exception applies? ��18-7

Q 18�6�3 Are certain legal communications excluded from the fiduciary exception based on their substance? ��18-8

Q 18�6�4 Does the fiduciary exception apply to the work product doctrine? ��18-9

Availability of Fee-Shifting ��18-10

Q 18�7 Is fee-shifting available in ERISA lawsuits? ��18-10Q 18�8 Must a party prevail in the litigation to recover its fees? ��18-10Q 18�9 In practice, which parties are mostly likely to

receive a fee award? ��18-10

Index ��I-1