The U.S. Supreme Court's Decision in CIGNA Corp. v. Amara - A Mixed Bag for Plan Sponsors

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The recent U.S. Supreme Court decision in the class action case of CIGNA Corp. v. Amara contains both good news and bad news for ERISA plan sponsors.

The U.S. Supreme Court held that a summary plan description ("SPD") does not constitute the terms of a plan. Therefore, a civil action under ERISA to enforce the terms of a plan cannot be used to enforce provisions of an SPD that conflict with the plan document. The Supreme Court also held that a presumption of likely harm is insufficient to determine the members of the class action. Actual harm is required.

While the above rulings are favorable to plan sponsors, the U.S. Supreme Court, in dicta, also stated that reformation of a plan and monetary damages may be acceptable equitable remedies for the failure to provide sufficient notice of benefit reductions and deficiencies in required plan communications.

Please see full article below for more information.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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