State Lawsuit Filing Deadlines Apply to ERISA

April 9, 2004 ( - Time limits governing how long employees have to file benefits claims suits under the Employee Retirement Income Security Act (ERISA) should be governed by laws in the workers' home state, a federal appeals court ruled.

>The US 8 th Circuit Court of Appeals ruled in an Iowa case that a state lawsuit over breach of contract was the most like an ERISA benefits claim, so courts considering a filing deadline dispute should follow the most analogous state statute of limitations since ERISA itself doesn’t have one, EBIA reported. In the Iowa case, appeals judges agreed with a lower court the employee’s lawsuit over benefits from her employer’s self-funded group health plan wasn’t filed too late and upheld the lower court judge’s ruling in favor of the employee’s claim that the plan wrongfully denied her benefits.

>The case should be governed by Iowa’s 10-year time limit for insurance contract claims, which the appeals court said was the most applicable to the employee’s situation.

>The lower court judge had ruled that the employer abused its discretion as plan administrator in denying the employee’s request for a benefit pre-authorization and awarded her approximately $11,000 (her out-of-pocket expenses for the medical procedure she sought), plus interest, attorneys’ fees and costs. In the appeals court, the employer had argued that the employee was not entitled to the money because her suit was filed too late.

The case is Shaw v. McFarland Clinic, P.C., 2004 U.S. App. LEXIS 6408 (8th Cir. 2004. Text of the ruling is at .