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Firestone’s Enduring Impact

September 05, 2023 (4 min read)

It’s been more than 30 years since the U.S. Supreme Court decided Firestone Tire & Rubber Co. v. Bruch, which significantly impacted ERISA benefits litigation by applying a standard of review for courts faced with review of an ERISA benefits claim determination. Before Firestone, in most instances, courts reviewing benefit determinations would apply a de novo review standard. This means that an adverse claim is reviewed by a court without being predisposed to either side. The Firestone court held that the abuse of discretion standard (also referred to as the arbitrary and capricious review standard) would apply where the benefit plan contained language sufficient to authorize the party deciding the claim to interpret the plan (or insurance policy) and render benefit determinations. Where the language is used, benefit claimants (usually) face the challenge of proving to the reviewing court that a benefit denial was arbitrary and capricious. Quite a hurdle! Be sure your plans/policies include the requisite language.

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Related Content

  • Standard of Review and Deference in ERISA Litigation
    Review this practice note discussing the standard of review applied and the deference afforded to plan administrators in litigation brought under ERISA. The legal challenges involve claims for the improper denial of benefits, breaches of fiduciary duty, or the enforcement of other statutory rights. ERISA, however, does not statutorily set forth the standard of review that courts should apply when reviewing challenges brought under ERISA.
  • Firestone Deference Clause (Employee Benefit Plan)
    Apply this Firestone deference clause in an employee benefit plan subject to ERISA to grant the plan administrator the binding authority to interpret and make determinations under the plan. 

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