Court Declines to Address ERISA Proper Defendant Status

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Oct. 13 — Health plan claims administrators won't be getting an answer anytime soon on whether they can be considered proper defendants in ERISA lawsuits for benefits after the U.S. Supreme Court declined to examine the contours of ERISA's civil enforcement provision.

The federal courts are divided on whether claims administrators can be sued under the Employee Retirement Income Security Act to recover benefits. While some courts have allowed plaintiffs to sue claims administrators, others have found that only plans, plan administrators and sometimes plan sponsors are proper defendants.

The Supreme Court's Oct. 13 refusal to take up the issue leaves standing a U.S. Court of Appeals for the Ninth Circuit ruling that didn't directly answer whether claims administrators are proper defendants in ERISA actions for benefits. The Ninth Circuit's ruling was centered primarily on whether health-care providers have constitutional standing to bring ERISA claims for benefits. That part of the court's ruling wasn't appealed to the Supreme Court.

The only issue presented to the high court, and denied review, was the question of whether a claims administrator with no obligation to pay benefits under an ERISA plan is a proper defendant in an action for plan benefits.

The petition was filed by Neal Kumar Katyal, Catherine E. Stetson and Frederick Liu of Hogan Lovells US LLP, Washington; Gregory Silbert of Weil, Gotshal & Manges LLP, New York; and Matthew M. Shors of UnitedHealth Group Inc. in Minnetonka, Minn.

Text of the Ninth Circuit's opinion is at http://www.bloomberglaw.com/public/document/Spinedex_Physical_Therapy_USA_et_al_v_United_Healthcare_of_Arizon/1.