The US Supreme Court has asked the US Solicitor General to express the government's views on whether to grant certiorari in an ERISA case: Strang v. Ford Motor Company General Retirement Plan [Briefs] [Order].
Technically, the question is:
"Whether the U.S. Court of Appeals for the 6th Circuit erred in holding–in conflict with the U.S. Courts of Appeals for the 2nd, 8th, and 9th Circuits–that an ERISA claimant is barred from alleging a claim for breach of fiduciary duty under section 502(a)(3) of ERISA, 29 U.S.C. § 1132(a)(3), whenever that claimant has the opportunity to allege a claim for benefits under section 502(a)(1)(B) of ERISA, 29 U.S.C. § 1132(a)(1)(B)."
Facts: The facts are so complex that they cannot all be laid out here. John Strang, the beneficiary of an ERISA plan, was told that the plan would allow lump-sum distributions during a randomly-assigned window period. When John was diagnosed with a terminal illness, he and his wife Jennifer had a number of communications with the plan in an attempt to make an early application for a lump-sum payment. However, John died before his election period began and his attempt to elect a lump-sum payment was ineffective. Jennifer submitted a claim and an appeal, but the plan denied her claim.
Jennifer sued the plan, bringing a denial-of-benefits claim under ERISA § 502(a)(1)(B). The 6th Circuit denied that claim, saying that it was not arbitrary and capricious for Ford to set a period to elect lump-sum distribution of retirement benefits. John did not apply during the established window, and the documents that were submitted were not in the proper form. Strang v. Ford Motor Company General Retirement Plan (6th Cir 05/19/2017) [PDF].
Jennifer then turned to ERISA § 502(a)(3) – breach of fiduciary duty. But the 6th Circuit disallowed that because "the injury for the breach of fiduciary duty and for the denial of benefits is one and the same." This analysis relied on Rochow v. Life Insurance Co., 780 F.3d 364 (6th Cir. 2015) (en banc) [PDF], which said:
"A claimant can pursue a breach-of-fiduciary-duty claim under § 502(a)(3), irrespective of the degree of success obtained on a claim for recovery of benefits under § 502(a)(1)(B), only where the breach of fiduciary duty claim is based on an injury separate and distinct from the denial of benefits or where the remedy afforded by Congress under § 502(a)(1)(B) is otherwise shown to be inadequate." [Emphasis in original.]
The Supreme Court will now wait to hear from the Solicitor General before deciding whether or not to grant certiorari. There is no deadline for the Solicitor. Generally this process takes several months, so we may need to wait until the Fall of 2018.