Claims Processes in Stock Plan and Other non-ERISA Litigation
2016.01.29 ERISA Formal Claim not Required - Employer Repudiation of Benefits Sufficed. In Bond v. Marriott, a 4th Circuit panel unanimously held that the ERISA claims of former employees are barred by the statute of limitations. The court held that ERISA's “formal denial” rule should not be applied in cases that do not involve an internal review process and a formal claim denial. Rather, the court emphasized that the operative question is whether the fiduciary has “clearly repudiated” the beneficiary’s entitlement to benefits. Applying that rule, the panel held that the plan prospectus adequately signaled such clear repudiation because it informed participants that the plan was a “top hat” plan exempt from ERISA’s vesting requirements. The court found it dispositive that --
2014.03.04 Standard of Review in Executive Plans - Artlcle. See this article for case law and good discussion of how courts have differed when applying the deferential Firestone standard applicable under ERISA plans (re "arbitrary and capricious" review) to non-qualified plans.
2012 Failure to Follow Claims Procedures results in Lost Deference. Per the Court decision, "Roth's decision is not entitled to deference because the agreements and plans grant discretionary authority only to the ECC, and the ECC neither decided appellees' claims nor delegated any authority to Roth." Schaffart v. ONEOK, 686 F.3d 461, at 471 (8th Cir. 2012), with the court's decision citing this authority:
2002 Arbitrary & Capricious Review Denied (1st Cir.)
The First Circuit refused to apply an arbitrary and capricious standard in reviewing a stock option plan committee’s denial of benefits because the underlying option agreement did not give the committee discretionary authority to interpret the plan’s provisions. Interestingly, the plan document under which the grant was made did grant that authority, but was apparently not incorporated by reference into the option grant (see 1st Circuit explanation that the district court ruled -
Kerkhof v. MCI Worldcom, Inc., 282 F.3d 44, 27 EBC 2806 (1st Cir. 2002), on remand, 204 F.Supp.2d 74, 28 EBC 2599 (D. Me. 2002).
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