ERISA-Ninth Circuit Rules That A Subrogation Provision In A Summary Plan Description Could Be Enforced

In Mull v. Motion Picture Industry Health Plan, No. 15-56246 (9th Cir. 2017), a panel of the Ninth Circuit Court of Appeals (the “Panel”) vacated the district court’s grant of summary judgement in favor of the plaintiffs in an ERISA action.

The district court had enjoined an ERISA plan and its board of directors from enforcing Summary Plan Description provisions regarding reimbursement of benefits previously paid upon a plan participant’s receipt of a third-party recovery. The district court had ruled that these reimbursement/recoupment provisions were not enforceable under ERISA because they were found only in the Summary Plan Description and not in any document that constituted the ERISA plan.

The Panel concluded that a Motion Picture Industry Plan Agreement and Declaration of Trust, along with the Summary Plan Description, together comprised the ERISA plan because only the Summary Plan Description provided the basis on which payments were made to and from the plan. Hence, since the Summary Plan Description is part of the plan,  the reimbursement provisions (often referred to as a “subrogation provisions”) in the Summary Plan Description could be enforced. The Panel distinguished CIGNA Corp. v. Amara, 563 U.S. 421 (2011), which held that summary documents do not constitute the terms of an ERISA plan when there exists both a governing plan document and a summary plan description as separate documents. The Panel vacated the district court’s grant of summary judgment and remanded for further proceedings.

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