In Cosey v Prudential, (4th Cir. Nov. 12, 2013), the Fourth Circuit held that the common plan formulation “proof satisfactory to the administrator” does not unambiguously confer discretion on the administrator and thus subjects the administrator’s decisions to de novo judicial review (as opposed to arbitrary and capricious review under the Firestone/Glenn standard).
Like Jon, I find this decision interesting, as it has the potential to cut back on the abuse-of-discretion standard of review for many ERISA plans. However, I suspect that in response to this Court’s decision, we are likely to see many plan amendments adding language which more unambiguously states the plan’s intention to get the benefit ofFirestone discretionary review for its benefit determination decisions.
This article was originally printed in Workplace Prof Blog on November 18, 2013. Reprinted with permission.
About the Author: Paul Secunda is a professor of law at Marquette University Law School. Professor Secunda is the author of nearly three dozen books, treatises, articles, and shorter writings. He co-authored the treatise Understanding Employment Law and the case book Global Issues in Employee Benefits Law. Professor Secunda is a frequent commentator on labor and employment law issues in the national media. He co-edits with Rick Bales and Jeffrey Hirsch the Workplace Prof Blog, recently named one of the top law professor blogs in the country.