November 06, 2019

In this article, Jenner & Block Chair Craig C. Martin and ERISA Litigation Practice Chair Amanda S. Amert examine recent lawsuits challenging out-of-date methods for calculating actuarially equivalent benefit payments.  The authors analyze motions to dismiss filed in two federal district court decisions:  Smith  v. U.S. Bancorp and Torres v. American Airlines, Inc.  They describe that, “in the context of decisions about how to provide entirely voluntary benefits to their employees, employers ought to be given wide latitude in making decisions, so long as they use a framework that is fundamentally fair to employees.”  The authors conclude that the decisions in Smith and Torres pave the way for the filing of similar complaints:  “We expect to hear more about actuarial equivalence litigation and the challenges it poses to plan sponsors offering defined benefit plans.”