Benefits & ERISA Law

LaRue, The Postscript

Remember the grave concern in different quarters about whether the Supreme Court’s ruling in LaRue would lead to a flood of litigation? Turns out it didn’t even do so in the LaRue case itself, which, now on remand at the trial court level, has been voluntarily dismissed by the plaintiff to avoid the expense of litigating the case. There’s your real check on excessive litigation: the costs of pursuing them. While ERISA grants a prevailing party the right to recover attorney’s fees, it is not a given that they will be awarded, particularly in a case, such as LaRue, where - as the multiplicity of opinions at the Supreme Court make clear - the law governing the issues in dispute is unsettled. Moreover, they are only awarded if you win; litigating a questionable case at significant expense risks large attorney’s fees that may never be recouped.

Of course, I guess all of this is just a back door argument for the outcome suggested by the opinion in Bendaoud discussed here: that the LaRue type cases are better structured as class actions than individual actions, for a variety of reasons, apparently including that litigating one small case is just plain not cost effective.

Full post as published by Boston ERISA Law Blog on October 24, 2008 (boomark / email).