Enforceability Of State Bars To Discretionary Clauses

Law360, New York (January 25, 2010, 3:05 PM EST) -- In 2009, several courts considered whether state laws that bar discretionary clauses in plan provisions governing the administration of benefit claims were preempted by the Employee Retirement Income Security Act of 1974 and, if so, whether they were saved from preemption by virtue of ERISA’s savings clause. This article examines these decisions, and considers the impact they may have on plan sponsors and plan fiduciaries.

Two decades ago, the U.S. Supreme Court, in Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101 (1989), held that...
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