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Conkright v. Frommert (U.S. 2010)

Articles Discussing Case:

High Court Rules ERISA Plan Administrator's Interpretation Is Entitled To Deference.

Ogletree Deakins • April 27, 2010
On April 21, with Chief Justice John Roberts writing for the majority, the U.S. Supreme Court upheld its Firestone Tire & Rubber Co. v. Bruch standard for reviewing the decisions of plan administrators where those decisions are made following a court determination that a previous interpretation of the same plan terms was arbitrary and capricious. Under Firestone and the terms of the Xerox Corporation pension plan at issue in this case, pension plan administrators would normally be entitled to deference when interpreting the plan. The Court held that the same deference also should apply where the administrator made a good faith error in its previous interpretation. The Court reversed the Second Circuit Court of Appeals' decision crafting an exception to Firestone deference and holding that a court need not apply a deferential standard when a plan administrator's previous construction of the same plan terms was found to violate the Employee Retirement Income Security Act (ERISA). Conkright v. Frommert, No. 08–810, U.S. Supreme Court (April 21, 2010).

Courts Must Show Deference to Interpretations by Plan Administrators (Even the Second Time Around).

Fisher Phillips • April 22, 2010
On April 21, 2010 the Supreme Court affirmed that a court must give deference to an ERISA fiduciary's second interpretation of ambiguous plan language, even if the first interpretation made by the fiduciary is struck down by the court as unreasonable. Using a "one strike doesn't mean you're out" analysis, the Court held that where the plan gives the fiduciary the broad authority to interpret the plan, that authority extends to the fiduciary's alternative interpretation if the first was a mistake. The so-called Firestone standard of judicial review which requires a court to give deference to a plan administrator's interpretation of a plan provision was upheld as a principle not susceptible to special exceptions. A court's duty is to be sure the fiduciary does not abuse its discretion, not to substitute its judgment if the fiduciary gets it wrong the first time because of an "honest mistake."