John E. Dowling v. Pension Plan for Salaried Employees of Union Pacific Corporation and Affiliates, et al.

The Employee Retirement Income Security Act (ERISA), 29 U.S.C. §§ 1001 et seq. is a comprehensive federal statute designed to “promote the interests of employees and their beneficiaries in employee benefit plans…and to protect contractually defined benefits.” Firestone Tire and Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S. Ct. 948, 103 L. Ed. 2d 80 (1989). ERISA establishes an unwavering fundamental rule that plan terms must be set forth in writing and plan administrators must act in accordance with the terms of the plan as written. In some cases, as here, the terms of the plan grant discretionary authority to the plan administrator to interpret the plan provisions. Courts must review such discretionary actions under a under a deferential abuse of discretion standard. Firestone Tire and Rubber Co. v. Bruch, 489 U.S. 101, 115. However, the plan terms remain the center of any ERISA analysis. The question presented is: Whether, in administering an ERISA-governed pension plan, a plan administrator with discretionary interpretive authority may ignore a general rule that is expressly stated in the plan – and capable of being applied to the circumstances as written – and substitute a different rule, thereby creating an exception to the general rule that does not otherwise exist in the plan itself.