Labor & Employment Law

SCOTUS Transcript: CIGNA Corporation v. Amara

Here is the transcript of today's US Supreme Court oral argument in CIGNA Corporation v. Amara.
[Details; briefs]

The issue:

Whether a showing of "likely harm" is sufficient to entitle participants in or beneficiaries of an ERISA plan to recover benefits based on an alleged inconsistency between the explanation of benefits in the Summary Plan Description or similar disclosure and the terms of the plan itself.

Background:

After CIGNA converted its traditional defined benefit pension plan to a cash balance plan, it issued a summary plan description (SPD) to plan participants.

Amara brought a class action claiming that CIGNA failed to comply with ERISA's notice requirements and SPD provisions.

The trial court held for Amara; the 2nd Circuit affirmed. The finding was that the SPD misrepresented the terms of the plan itself. Although CIGNA argued that the plaintiffs failed to show injury, the court found that the participants had shown "likely harm" and that CIGNA had failed to establish harmless error.

CIGNA's position is that a plan participant must prove detrimental reliance on the SPD in order to recover benefits based on an inconsistency between the SPD and the plan itself.

The US Supreme Court granted certiorari to review the 2nd Circuit judgment. Oral arguments were held November 30.

A decision is expected by June 2011.

Full post as published by Ross' Employment Law Blog on December 01, 2010 (boomark / email).