ERISA-Ninth Circuit Upholds One-Year Limit On Bringing Suit Contained In The Summary Plan Description

In Scharff v. Raytheon Company Short Term Disability Plan, No. 07-55951 (9th Cir. 2009), the plaintiff, Donna Scharff, had worked for the Raytheon Company, and had participated in the Raytheon Company Short Term Disability Plan (“Short Term Plan”) and the Raytheon Company Long Term Disability Plan (“Long Term Plan”). The summary plan description (“SPD”) for the Plans contained a one-year statute of limitations for bring suit. After the plan administrator denied the plaintiff’s claim for benefits under the Short Term Plan, the plaintiff brought suit for benefits from both Plans, but she filed the action twenty days after the Plans’ one-year statute of limitations had lapsed.

The Court upheld the one-year limit, ruling that this contractual statute of limitations meets applicable legal and disclosure requirements, including the requirements of ERISA and any requirement of “reasonable expectations” pertaining to the Plans. Thus, the plaintiff’s suit was time barred.

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