The Supreme Court Examines Requirements for ERISA Plan Beneficiaries to Recover Additional Benefits Based on Inconsistency Between the Plan’s Summary Plan Description and the Plan Itself
The United States Supreme Court heard oral arguments Tuesday in CIGNA Corp. v. Amara, No. 09-804, a case in which the Court may determine the legal standard that applies when Employee Retirement Income Security Act of 1974 (“ERISA”) plan beneficiaries allege an inconsistency between a summary of the plan provided by the employer, known as a Summary Plan Description (“SPD”), and the terms of the underlying plan itself. Specifically, the Court may decide whether a showing of “likely harm” to plan beneficiaries warrants an award of damages, or whether a greater showing such as detrimental reliance must also be established. Under ERISA, an SPD must be provided to plan beneficiaries and must provide an easily understood summary of the plan’s terms. The Court’s determination of this issue may significantly affect how plan fiduciaries prepare SPDs.