Supreme Court Declines to Hear ERISA Benefit Denial Case

Yesterday, the nation’s high court passed up the opportunity to clarify the analysis applicable to Employee Retirement Income Security Act of 1974 (ERISA) appeals. The denial rejected the petitioners’ plea to resolve a “clear and intolerable” conflict created by the underlying Fifth Circuit ruling.

The petitioners, North Cypress Medical Center Operating Company, Ltd. and North Cypress Medical Center Operating Company GP, LLC filed their request for Supreme Court review in September. The case reportedly arose from the denial of an ERISA benefits claim, which was then confirmed by a district court and unanimously affirmed by the Fifth Circuit.

In their filing, the petitioners asked the Supreme Court to clarify whether lower courts must apply a “combination-of-factors” analysis that contemplates all relevant “case-specific” factors and weighs them together, and whether the Fifth Circuit’s ruling impermissibly “abandoned that totality analysis and replaced it with a per se rule.” The petitioners explained that the case is important because the Fifth Circuit’s “outlier position” creates a direct conflict with the Supreme Court and other circuit precedent.

They further claimed that the ruling “endorses an approach that will excuse improper administrator actions, and override the totality analysis that is necessary to root out fiduciary misconduct.” They called it a “mechanical standard” that deprives appellants of the opportunity to expose flaws and deficiencies in an administrator’s decision.

In their brief in opposition, respondents Cigna Healthcare, Connecticut General Life Insurance Company, and Cigna Healthcare of Texas, Inc. argued that there was no need for Supreme Court review. They contended that the Fifth’s Circuit decision does not break with precedent as the petitioners claimed, but instead, “reflects an unremarkable application of stare decisis…” In addition, the respondents noted that if the petition “looks familiar, that is because it is a slightly modified version of the same petition that North Cypress’s counsel filed, and this Court denied [in 2017].”

The petitioners are represented by Sutter & Kendrick, P.C. and Alexander Dubose & Jefferson LLP, and the respondents by McDermott Will & Emery LLP.