WKCHR is pleased to announce that on August 1, 2017, the Ninth Circuit Court of Appeals issued an opinion in Mull v. Board of Directors of the MPI Health Plan finding in favor or our client, the MPI Health Plan. The case was successfully argued by Partner, Kathryn Halford and briefed by Partners Elizabeth Rosenfeld and Kathryn Halford.
The MPI Plan had appealed the District Court’s summary judgment finding that the Plan’s Summary Plan Description (“SPD”) was not enforceable as a Plan Document under ERISA. This case is a significant clarification of the law in this Circuit after the Supreme Court’s decision in Cigna v. Amara, 563 U.S, 421 (2011) in which the Supreme Court questioned the enforceability of summary plan descriptions (intended to inform Participants about Plan) as Plan Documents. The MPI Plan had expended $147,000 in accident related benefits for Lenai Mull who failed to reimburse the Plan from her third-party recovery. The Mulls sued the MPI Plan and argued that the Plan’s reimbursement/ overpayment provisions were not enforceable Plan terms because they were not contained in the MPI Plan’s Trust Agreement, which they contended was the only enforceable Plan Document. The Ninth Circuit found that the Trust Agreement contains three of the four requirements but does not satisfy the fourth for an ERISA Plan Document because it does not specify the basis upon which payments are to be made from the MPI Plan. The SPD is the only document that satisfies this fourth requirement and is intended to be a Plan Document. The Court correctly concluded that “‘the Plan’ is comprised of two documents: the Trust Agreement and the SPD.” The MPI Plan’s structure is common for many of our Taft-Hartley Health Plans where a plan of benefits is created and adopted after the establishment of the Trust. This ruling should provide some assurance that no major redrafting of plan documents will be required.
The written decision can be found here: Mull