Professor Gerry W. Beyer (Wills, Trusts & Estates Prof Blog) recently posted a note about Paul Secunda’s article, Sorry, No Remedy: The Grand Irony of ERISA, which is an article I have looked forward to reading. Evidently only the abstract is available on SSRN at present, but I’ll update this post if I find out otherwise.
Judging by the abstract, the article may be understood syllogistically as follows:
#1 Strict construction of the ERISA statute has led the Supreme Court to broadly construe the preemption provisions of ERISA so that most state laws do not survive ERISA preemption, and
#2 Concomitantly, the Court has narrowly construed the remedies available to participants and beneficiaries available under ERISA’s civil enforcement scheme, so that
#3 Many employees are finding that they have no meaningful remedy for their claims under the statute.
Observations
While awaiting an opportunity to read the article, and mindful some points may be altered based upon that, I will venture a few observations nonetheless.
As to the first premise:
# 1 There is no doubt that ERISA’s broad preemptive reach was a calculated and intentional act of the Congress. This served the interests of big business and big labor for reasons that have been amply explained elsewhere.
#2 The early decisions of the Court affirming the breadth of ERISA’s preemptive reach were not fragmented decisions wherein ideological camps warred with one another in divided opinions. Take a look at SHAW v. DELTA AIR LINES, INC., 463 U.S. 85 (1983), authored by Blackmun for a unanimous Court.
#3 The retrenchment in ERISA preemption, signaled by New York State Conference Of Blue Cross & Blue Shield Plans et al., began in 1995 in the estimation of most observers, and that opinion was authored by . . . Justice Scalia.
So, I don’t think we can blame the Court, or the textualists for that matter, for the preemption problem.
As to the second premise:
#1 The Court’s narrow construction of ERISA’s remedial provisions has been predicated on an assumption that Congress said all it intended to say on available remedies since it set the provisions out with particularity. This proposition has flaws – in the first place, there are many gaps in ERISA’s remedial regime which the courts have attempted to plug. I agree as well that the Court faltered in its appropriation of analogies with the trust paradigm as has been well explained by Prof. Langbein.
#2 More troubling to me, however, is the Court’s reliance on administrative law analogies without statutory warrant. Here, is it really strict construction we are complaining about?
On the contrary, I think we could use a closer reading of the statute as opposed to the judicial structuring of benefit adjudications as, in effect, agency proceedings, sans APA protections. Mark DeBofsky’s addresses this concern in The Paradox of the Misuse of Administrative Law in ERISA Benefit Claims.
Much has been predicted of what the new administration may bring in the way of ERISA reforms. In my view, the academic community could be a real assistance by providing specific proposals on practical reforms. Good work, Paul, on opening the subject for debate.
In the meantime, it is sobering to reflect on the historical fact that ERISA has withstood many years of criticism. So we’ll see. It would not surprise me, however, if the affair ends as it often has, with a whimper, as in the old fable.
A mountain was in labour, sending forth dreadful groans, and there was in the region the highest expectation. After all of that, it only brought forth a mouse.
Book iv. Fable 23, Phaedrus