Third Circuit – Failure to Identify Plan’s Limitation Period in Denial Letter Precludes Enforcing Deadline

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In 2013, the Supreme Court reaffirmed that ERISA plans can impose shorter limitations periods than would otherwise be the case if the plan was silent. Nevertheless, the United States Court of Appeals for the Third Circuit recently held that, even though there was evidence that a claimant had notice that of the plan’s limitations period, which had expired, that limitations period could not prevent his lawsuit. What led the Court to this decision? Read on to find out. In Mirza v. Insurance Administrator of America, Inc., No. 13-3535, 2015 WL 5024159 (3d Cir. Aug. 26, 2015), the plaintiff was [...] Read more

Preserving The Role Of The Independent Fiduciary Post-Dudenhoeffer

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In the wake of Fifth Third v. Dudenhoeffer, a complaint that seeks to hold an ERISA fiduciary liable for failing to divest a plan of employer stock based solely upon publicly available information fails to state a plausible claim.  An “independent” fiduciary – by the very nature of his outside status – only has access to public information.  For this reason, claims that an independent fiduciary breached his ERISA fiduciary duties in connection with publicly traded company stock necessarily fail post-Dudenhoeffer.    In this article, recently published in the Summer 2015 Edition of [...] Read more

DOL “Best Interest” Exemption Not The Best Way To Get Sued

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The Department of Labor recently proposed a new regulation to define when financial advisers are considered “fiduciaries” under the ERISA and the Internal Revenue Code. The proposed regulation also includes new prohibited transaction exemptions (PTEs), as well as revisions to, and elimination of, certain existing PTEs. The primary PTE available to most financial advisers, should the DOL’s proposals become effective, is the proposed best interest contract prohibited transaction exemption (the “best interest contract PTE”). This PTE provides a broad prohibited transaction exemption (but [...] Read more

Advisory: Department of Labor Proposes New Regulation Governing When Financial Advisors Are Subject to Fiduciary Requirements

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The Department of Labor (DOL) has now proposed long-anticipated changes to the regulation that delineates when financial advisors become fiduciaries to certain benefit plans (such as retirement plans and Health Savings Accounts). This is an important distinction because fiduciary status imposes a number of requirements and implicates certain prohibited transaction rules (particularly concerning the receipt of fees). Under ERISA, a person can become a fiduciary in three general ways: (1) they can be designated as such in the plan documents; (2) they can be a “functional fiduciary” in the [...] Read more

Recent Developments in Employee Benefits Law

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This article, which was recently published in the ABA Tort, Trial & Insurance Practice Law Journal, surveys recent developments in employee benefits law from Fall 2013 through Fall 2014.  The first portion of the survey reviews two important Supreme Court cases from last term, Fifth Third Bancorp v. Dudenhoeffer and Heimeshoff v. Hartford Life & Accident Insurance Co.  The second portion of the survey reviews eight important decisions issued by the appellate courts during the last year.  The final portion of the survey reviews a proposed rule from the Department of Labor that would [...] Read more

Pat DiCarlo and Emily Hootkins Published in Law360 – “6th Circ. Rejection Of Disgorgement Brings ERISA Relief”

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On rehearing en banc, the Sixth Circuit has restored order for individual benefits cases by rejecting a judgment ordering Life Insurance Co. of North America to disgorge nearly $3.8 million in profits after wrongfully withholding long-term disability benefits from a plan participant. The majority agreed that allowing a disgorgement award in addition to requiring the insurer to pay the individual disability benefits would be an “impermissible duplicative recovery” under ERISA. To read the full article, please click here. [...] Read more

Hinson and Costin Published in Law360 – Determining ERISA Duties Post-Dudenhoeffer

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It is hard to imagine how a new, separate, distinct duty to disclose inside information about public companies under the Employee Retirement Income Security Act, along with the specter of ERISA fiduciaries becoming a new source of “material” information about public companies, would not cause more harm than good, say H. Douglas Hinson and Emily Costin of Alston & Bird LLP, in an article published on Law360.

To read the full article, please click here.

Advisory – M&G Polymers v. Tackett: New Standards for Vesting of Retiree Medical Benefits in Collective Bargaining Agreements

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Alston & Bird issued an advisory that discusses the Supreme Court’s recent decision in M&G Polymers v. Tackett, which addressed whether collectively bargained retiree medical benefits were vested for life.   Prior to M&G Polymers, federal circuits were split over how to interpret collective bargaining agreements (CBAs) regarding whether retiree medical benefits are vested after the expiration of the CBA.  In a unanimous ruling (with a concurrence by Justice Ginsburg, joined by 3 other Justices), the Supreme Court overturned the Sixth Circuit’s Yard-Man presumption that such [...] Read more

Advisory – ERISA Fiduciary Decisions: Making Changes to Your Qualified Plan’s Investment Lineup

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Following recent financial news regarding changes at the PIMCO Total Return Fund, Alston & Bird’s Employee Benefits & Executive Compensation Group summarizes the technical requirements and recommended procedures in making changes to your retirement plan’s investment lineup. From time to time, fiduciary committees need to consider whether to make a change in the investment alternatives available in their retirement plans. Typically in 401(k) and 403(b) plans and sometimes in other defined contribution plans, the fiduciary committee selects the investment options or funds available [...] Read more

Third Circuit Serves Up Big Win for Retirement Plan Service Providers

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The U.S. Court of Appeals for the Third Circuit recently issued an important decision in one of the many cases alleging that financial services companies breached fiduciary duties under ERISA by charging allegedly excessive fees. This type of litigation has grown more prevalent in recent years. However, most appellate courts, including now the Third Circuit, have found these claims unmeritorious. In Santomenno v. John Hancock Life Insurance Company, No. 13–3467, 2014 WL 4783665 (3d Cir. Sept. 26, 2014), the plaintiffs argued that, as a service provider to their 401(k) plan, John Hancock had [...] Read more