Erisa retirement plan - supreme court petitions

Another preemption issue that may reach the Court concerns municipal- and state-level laws that aim to fill the gaps created when employers decline to provide health or retirement benefits.

The cases concern whether ERISA’s preemption clause also prevents states or municipalities from creating worker benefit programs. Last year, the Ninth Circuit held that two programs designed

to help workers save money — a Seattle ordinance requiring hotels that have no employee health plan to pay their employees’ health care costs, and a California statute creating tax-deferred

retirement savings accounts for workers whose employers do not have ERISA-covered retirement plans (CalSavers) — are not preempted by ERISA. _ERISA Industry Committee v. City of Seattle_, 

840 Fed. App’x 248, 248-49 (9th Cir. 2021); Howard Jarvis Taxpayers’ Association v. California Secure Choice Retirement Savings Program, 997 F.3d 848, 867 (9th Cir. 2021). AARP and AARP

Foundation filed an amicus brief in support of the CalSavers program. AARP also sought to intervene in _Pacific Bells LLC v. Inslee_ to defend that Washington state’s Long-Term Services and

Supports Trust Act (“WA Cares”) and argue that the Act is not preempted by ERISA. No. C21-1515 TSZ (W.D.W. March 10, 2022) (ECF No. 30). The District Court agreed, holding that because WA

Cares is not “‘established or maintained’ by an employer and/or employee organization, it is not an ‘employee benefit plan’ and it is not governed by ERISA.” _Pac. Bells, LLC v. Inslee_, No.

C21-1515 TSZ, 2022 WL 1213322, at *2 (W.D. Wash. Apr. 25, 2022). This year, the Supreme Court denied the plaintiffs’ cert petition in _Howard Jarvis Taxpayers’ Association_, and through its

denial allowed CalSavers to continue operating. In _ERISA Industry Committee_, the Supreme Court has not yet granted certiorari, but it appears poised to do so based on its issuance of a

request that the solicitor general weigh in to explain the federal government’s position on the issue. The Court soon may also consider whether ERISA claims for breach of fiduciary duty can

be arbitrated. The brewing circuit split that we wrote about last year has deepened, paving the way for potential resolution by the Court. This year, the Seventh Circuit denied arbitration

in an ERISA case by invoking a rarely used exception to the Federal Arbitration Act, finding that the arbitration provision at issue constituted a “prospective waiver of a party’s right to

pursue statutory remedies.”_ __Smith v. Bd. of  Dirs. of Triad Mfg., Inc._, 13 F.4th 613, 620-21 (7th Cir. 2021) (quoting _Mitsubishi Motors Corp. v. Soler Chrysler-Plymouth, Inc._, 473 U.S.

614, 637 n.19, 105 S. Ct. 3346 (1985)). The Sixth Circuit also denied arbitration in an ERISA action based on a determination that the claims at issue “should be thought of as Plan claims,”

and that “because the arbitration provisions only establish the Plaintiffs’ consent to arbitration, the employment agreements do not subject these claims to arbitration.” _Hawkins v. Cintas

Corp._, 32 F.4th 625, 635 (6th Cir. 2022). On the other hand, a district court in the Southern District of Florida reached the opposite conclusion, finding an arbitration provision valid

and enforceable. _Holmes v. Baptist Health S. Fla., Inc._, No. 21-22986-Civ, 2022 WL 180638 at *3 (S.D. Fla. Jan. 20, 2022). Finally, in the coming years the Court may address whether

certain ERISA claimants have standing. In _Wit v. United Behavioral Health__,_ the Ninth Circuit held that the plaintiffs, who alleged that defendant United Behavioral Health developed

guidelines used to administer claims under the plans at issue that did not comport with the benefits afforded them by the terms of those plans, had adequately alleged a concrete injury, 2022

WL 850647 at *1 (9th Cir. 2022). Specifically, the Ninth Circuit found that the plaintiffs were prevented from “mak[ing] informed decisions about the need to purchase alternative coverage

and the ability to know whether they are paying for unnecessary coverage.” _Id._ The Third Circuit issued a similar decision regarding named plaintiffs’ standing to bring claims “relating to

funds in which they did not personally invest.” _Boley v. Universal Health Servs., Inc._, 36 F.4th 124, 129 (3d Cir. 2022). This case is significant because it is the first circuit-level

case following _Thole v. USA Bank, N.A._, 140 S. Ct. 1615 (2020), to consider whether plan participants can bring an ERISA class action challenging funds they do not personally hold in their

retirement accounts. The Third Circuit held that the plaintiffs had sufficiently pleaded that they suffered the type of concrete and personalized injury required by _Thole,_ given that they

did “not allege thirty-seven individual breaches of fiduciary duty, but rather several broader failures by [the defendant] affecting multiple funds in the same way.” _Boley_, 36 F.4th

132-33.