US Supreme Court Hears CT ERISA Case

On November 30, the US Supreme Court heard oral arguments in CIGNA Corp. v. Amara. The case stems from the summary plan description (SPD) CIGNA issued to explain the conversion of its traditionally defined benefit pension plan to a cash balance plan. In 2008 the U. S. District Court, District Connecticut, ruled that CIGNA’s SPD violated the Employee Retirement Income Security Act (ERISA) by failing to provide notice of a significant reduction in the rate of future benefit accrual, and failing to adequately disclose modifications that could result in reductions, losses, or forfeitures of benefits that a participant might otherwise reasonably expect to receive (534 F. Supp. 2d 288 (D. Conn. 2008)). The U.S. Court of Appeals for the Second Circuit affirmed the decision in 2009. The issue presently before the Supreme Court hinges on whether proof of “likely harm” caused by the misleading SPD is enough to entitle a plaintiff to recover damages. The Court should issue its decision sometime in the spring.