The Supreme Court observed “that Firestone means what the word ‘factor’ implies, namely, that when judges review the lawfulness of benefit denials, they will often take account of several different considerations of which a conflict of interest is one.” The Court analogized review of an ERISA plan administrator’s denial of benefits to the standards of review applied in trust and administrative law, noting “judges . . . determine lawfulness by taking account of several different, often case-specific, factors, reaching a result by weighing all together,” citing its decisions in Citizens to Preserve Overton Park, Inc. v. Volpe, and Universal Camera Corp. v. NLRB.
Young v. Wal Mart, No. 07-31130 (5th Cir. 9/22/2008)
The Fifth Circuit makes a noteworthy link between administrative law and ERISA claims adjudication in Young v. Wal Mart. The Court gives consideration to the two seminal administrative law cases noted by Justice Breyer in the recent Glenn decision in the context of reviewing agency fact-finding.
In this context, the point of Universal Camera was that federal courts should uphold agency factual findings if supported by “substantial evidence on the record considered as a whole.”
“Substantial evidence” (a controversal standard when the APA was adopted) was the standard before Universal Camera – so the significance of the decision lies in the emphasis of the review of the record asa whole. In Universal Camera, the Court (through Justice Frankfurter) felt it was giving some deference to Congress’ mood that the courts had been to lenient prior to the APA in seeking only substantiating evidence without a critical eye toward other, potentially conflicting, evidence.
I believe the Fifth Circuit missed the point here. In reversing the district court, the Fifth Circuit says “[t]he administrative record contained substantial evidence, “even if disputable,” that supports the plan administrator’s denial of benefits.” This framing of Universal Camera does not do the case justice in historical context.
Still, the Fifth Circuit’s invocation of the adminstrative law paradigm is significant. As an adminstrative law expert, Justice Breyer used the paradigm advisedly. And, in the ERISA claims process, all to lacking in procedural guidance, the administrative law analogies could actually be useful in judicial review of the reliability of the administrative record.
Thus far, however, administrative law analogies have all been focused on efficiency goals, such as, for example, the exhaustion of adminstrative remedies requirement. After Glenn, one might expect to see other applications where the concern is the integrity of the administrative record. Young will not be such a case