Abatie v. Alta Health & Life Insurance

No. 03-55601 (9th Cir. August 15, 2006)

On August 15, 2006, the Ninth Circuit Court of Appeals issued an en banc opinion in Abatie v. Alta Health & Life Insurance. The decision establishes, for that circuit, a new standard of review of a plan administrator's decision to deny ERISA benefits when the administrator operates under an apparent conflict of interest or where the process is irregular. Under the new standard, where there is an apparent conflict, courts in the Ninth Circuit should now apply an abuse of discretion review, "tempered by skepticism commensurate with the plan administrator's conflict of interest." This decision places the circuit in the mainstream of the tests followed by other circuits, and, indeed, is somewhat more defendant friendly.

Jorden Burt briefed and argued this issue on behalf of the appellee insurer before the Ninth Circuit, and successfully resisted appellant's arguments for the adoption of a far stricter standard. A detailed analysis of the case is attached.

For more information, contact Waldemar J. Pflepsen, Jr. at (202) 965-8133 or wjp@jordenusa.com or Stephen H. Goldberg at (202) 965-8113 or shg@jordenusa.com.