Supreme Court Sends Pension Plan Case Back to Lower Court for Reconsideration

The Supreme Court has issued a decision in CIGNA Corp. v. Amara, (pdf) holding unanimously that section 502(a)(1)(B) of the Employee Retirement Income Security Act (the section allowing a participant to sue for benefits under an ERISA plan) did not permit the district court to rewrite the terms of the benefit plan to reflect employee expectations arising from a summary plan description (SPD) because the SPD is not the “plan.” The Court also reasoned that because the plan can be amended only by the employer acting as settlor, and the SPD must be written and distributed by the plan administrator, it would be anomalous for the plan administrator to be able to modify the terms of the plan by erroneously describing its terms, even if – as in the instant case – the employer is also the plan administrator. Six of the Justices found, however, that another section (502(a)(3)) of ERISA might allow the lower court to reform the company’s pension plan provisions or to provide the requested benefits in the form of damages, and sent the case back for reconsideration. The two concurring Justices agreed with the remand but would not have expanded on the potential recovery that might be available under section 502(a)(3).  Continue to read the post on Littler's Washington DC Employment Law Update.

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