U.S. Supreme Court to Hear Important ERISA Case on April 23
On April 23, 2008, the U.S. Supreme Court will hear arguments in MetLife v. Glenn. This is an important case that may affect all future lawsuits to collect benefits under an employee benefit plan. Where a benefits case is subject to ERISA, the lawyers in nearly every case argue over the standard of review. Employees argue that the court should review the eligibility decision de novo while employers and plan sponsors argue that a deferential standard of review should apply and the benefit decision should be overturned only if the decision was arbitrary and capricious. In the Glenn case, the Supreme Court will decide what standard of review should be applied under plans where the same entity that decides whether to pay benefits is also the entity that will pay benefits (e.g., insurance companies or self-insured employers). The circuit courts have reached different views on this issue. For example, an en banc panel in the Ninth Circuit issued a watershed case last year in the Abatie case holding that a less deferential standard should apply when there is a conflict of interest. The Ninth Circuit went so far as to say that defendants in ERISA benefits cases should take it upon themselves to prove that there is no conflict, even if the issue is not raised by the plaintiff. The Supreme Court will now weigh in with its views. More information about the case and the briefs can be found here.