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in 1996, The Wagner Law Group is dedicated to the highest standards
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consultant and three paralegals combine many years of experience in
their fields of practice with a variety of backgrounds. Seven of
the attorneys are AV-rated by Martindale-Hubbell and six are
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August 3, 2017
Health and Welfare Law
Finds SPD to be Official Welfare
Fifth Circuit Court of Appeals, in Rhea v. Alan Ritchey, Inc.
Welfare Benefit Plan, has confirmed that a welfare benefit plan's
summary plan description ("SPD") could serve as the
official plan document. In making this ruling, the Fifth Circuit
expressly rejected the plaintiff's assertion that the Supreme Court's
decision in CIGNA Corp. v. Amara requires ERISA-covered plans
to maintain an official plan document and SPD as separate documents.
Background. In Rhea, a beneficiary under an
ERISA-covered welfare benefit plan received a settlement in
connection with injuries she incurred from medical malpractice. The
plan at issue operated using a single instrument as the plan document
and SPD. This document contained a provision that required
reimbursement of any benefits paid by the plan to a beneficiary in
the event that a third party paid a settlement to the beneficiary for
causing the injuries.
accordance with the plan's reimbursement provision, the plan sought
reimbursement from the beneficiary for the benefits paid. The
beneficiary responded by refusing to reimburse the plan, claiming
that the reimbursement provision was invalid because it was not
contained in an enforceable plan document. Specifically, the
beneficiary argued that the document was unenforceable because it
referenced an official plan document, which the plan did not have.
obtained a favorable judgment against the beneficiary from the
district court assigned to review the matter. In turn, the
beneficiary appealed the adverse decision to the Fifth Circuit.
Circuit. In reviewing the
matter, the Fifth Circuit rejected the beneficiary's contention that
a single document could not serve as both the plan's SPD and the
official plan document. The court noted that the document contained
all of the elements required by ERISA and, that unlike the facts in Amara,
there was no conflict between the document and other written
information concerning the plan. Accordingly, the Fifth Circuit
affirmed the lower court's decision in favor of the plan sponsor.
for Plan Sponsors. Rhea
confirms that courts will enforce an SPD as the official plan
document if it contains all of the elements required under ERISA and
does not conflict with any other plan-related documents. In view of
this fact, plan sponsors must be sure that their SPDs provide
accurate descriptions of the plans' benefits and meet ERISA's
requirements so that they can limit liability where applicable.
this decision, the SPD and the plan generally should be separate
documents because they serve conflicting purposes. An SPD must
provide information about the plan in language that can be understood
by the average participant while the plan document must contain all
legal detail needed to establish and maintain the employee benefit
v. Alan Ritchey, Inc. Welfare Benefit Plan is available at:
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