On April 22, 2013, the Supreme Court granted the petition for a writ of certiorari in CGI Technologies & Solutions v. Rose, et al., and then immediately vacated and remanded the Ninth Circuit’s judgment in light of US Airways, Inc. v. McCutchen, 569 U.S. ____ (2013).

The facts of this case are quite similar to McCutchen. However, unlike in McCutchen, the plan in CGI Technologies & Solutions v. Rose expressly disclaims the common-fund and make-whole doctrines. Thus, on remand under McCutchen, we expect that the Ninth Circuit will allow the express terms of the plan to govern and require Rose to reimburse the plan in full for medical expenses it incurred on her behalf.

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ERISA requires that “[e]very employee benefit plan . . . be established and maintained pursuant to a written instrument” that “specif[ies] the basis on which payments are made to and from the plan.” 29 U.S.C. §§ 1102(a)(1), (b)(4). ERISA then directs the plan administrator to discharge his duties “in accordance with the documents and instruments governing the plan.” Id. § 1104(a)(1)(D).

In Kennedy v. Plan Administrator for DuPont Savings & Investment Plan, 555 U.S. 285 (2009), the Supreme Court held that an ERISA plan administrator must distribute benefits to the beneficiary named in the plan, regardless of any state-law waiver purporting to divest that beneficiary of his right to the benefits. However, Kennedy explicitly left open the question of whether, once the benefits are distributed by the administrator, the decedent’s estate can enforce a waiver against the plan beneficiary. See id. at 299 n. 10 (“Nor do we express any view as to whether the Estate could have brought an action in state or federal court against [the plan beneficiary] to obtain the benefits after they were distributed.”). The Fourth Circuit recently addressed this question in the affirmative, following the Third Circuit’s holding in Estate of Kensinger v. URL Pharma, Inc., 674 F.3d 131 (3d Cir. 2012). See Andochick v. Byrd, No. 1:11–cv–739, 2013 WL 781978 (4th Cir. March 4, 2013).

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Federal Rule of Civil Procedure 23(b)(2) authorizes class action treatment if the defendant “has acted or refused to act on grounds that apply generally to the class, so that final injunctive relief or corresponding declaratory relief is appropriate respecting the class as a whole.” But is it really possible for a defendant to “act” or “refuse to act” the same way with respect to a group that is so large and varied that it is broken into 10 separate and distinct subclasses? Judge Posner thinks so. Indeed, writing on behalf of a three-judge panel of the Seventh Circuit, Judge Posner recently affirmed certification under Rule 23(b)(2) of a class of more than 4,000 individuals who participated in an ERISA-governed pension plan over a span of 23 years, and comprising 10 distinct subclasses. See Johnson v. Meriter Health Services Employee Retirement Plan, --- F.3d ----, 2012 WL 6013457 (7th Cir. Dec. 4, 2012).

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In a matter of first impression, the Ninth Circuit recently held that the attorney-client privilege does not apply to communications between an insurer and counsel before a claims decision is made. Creating a split with the Third Circuit, the Ninth Circuit held that the “fiduciary exception” to the attorney-client privilege should be extended to insurers that administer benefit plans governed by ERISA, and acting in a fiduciary capacity. See Stephan v. Unum Life Ins. Co. of Am., No. 10-16840l, --- F.3d ----, 2012 WL 3983767 (9th Cir. Sept. 12, 2012). This is a chilling decision for all practitioners who advise insurers of ERISA plans.

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On July 18, 2012, Judge Rosemary Collyer of the United States District Court for the District of Columbia denied certification of a class of 1,350 U.S. Airways pilots in an ERISA class action to recover interest on lump sum pension distributions, in a case that has been pending for more than a decade. Judge Collyer held that the named plaintiff’s exhaustion of his administrative remedies under the pension plan did not suffice for the entire class, and does not, as a matter of law, excuse the entire putative class from exhausting their administrative remedies. Therefore, the pilots’ claims could not be maintained as a class action.

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On June 25, the Supreme Court granted the petition for a writ of certiorari submitted by US Airways, regarding the Third Circuit’s ruling in US Airways, Inc. v. McCutchen, 663 F.3d 671 (3d Cir. 2011). The Third Circuit held that a judgment requiring a plan participant to provide full reimbursement to the plan administrator for medical expenses which the administrator paid to the participant constituted “inappropriate and inequitable relief.”

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On December 28, 2011, the United States District Court for the District of Colorado blocked a chiropractor’s attempt to recover benefits for providing services to NFL players and their families under a new Colorado statute, holding the doctor’s claims were preempted by ERISA.

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Earlier this year, the Third Circuit considered whether American Airlines properly terminated a commercial airline pilot’s claim for long-term disability (“LTD”) benefits, where the pilot’s putative disability claim arose from a psychotic episode.

In Miller v. American Airlines, 632 F.3d 837 (3d Cir. 2011), the Third Circuit reversed the decision of the United States District Court for the Middle District of Pennsylvania, which had granted summary judgment for American Airlines, the benefits plan and the plan administration committee. In reaching its decision, the Third Circuit parsed through the contents of the termination letter that was sent to the pilot and weighed the impact of its contents in determining whether the decision to terminate the pilot’s LTD benefits was arbitrary and capricious.

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