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Thank you very much QDROphile for your reply. No litigation has been initiated yet; just researching the possibility of various "plans of attack" being "defused" through some esoteric application of existing statutes before expending time and monies. Nonetheless, we will heed your further advice and research the matter with various other avenues more suited, as you pointed out, to the question at hand. My very best regards to you!

Good Morning: In the instance of "civil" litigation between two parties regarding an ERISA covered benefit plan, can the defendant in such a suit, that involves an allegation of material misrepresentation (fraud), have the case removed to Federal Court based upon wording contained within the ERISA Statute itself? Thanks in advance for any replies!

Hello Kenneth, Yes, the intent of the Estate /beneficiaries thereof is to pursue litigation. In that regard, if anyone on this site has the name or names of individuals or firms that are well versed in ERISA law and represent plaintiffs in lawsuits AGAINST Plan Administrators and practice in the Northern District of Illinois (7th Cir) , please feel free to "message" me directly as any help in finding legal counsel would be immensely helpful! Thank you one and all who have taken the time to respond to this thread for your insights; I greatly appreciate it!!

Hi Gina, Just reread your comment of earlier and I concur wholeheartedly. The Plan Document does state that the a set of Rules and Procedures will be established by the Plan Administrator. No doubt getting these particular documents , along with a statement from the Plan Administrator SPECIFICALLY stating on what basis the funds were disbursed to the party in question will be of the utmost value.

Hi RatherBeGolfing, Thanks for your reply/question. I guess it's a matter of opinion as to how "material" the defects are; without going into too much detail at this juncture, I will say that they are more "material" than say the PURELY HYPOTHETICAL instance where the Beneficiary Designation Form says "use blue ink only" and the form is filled out using a black ink pen. No doubt the Plan administrator will contend that the "defects" are, "mere technicalities" even though documents of their own creation are the source/cause of the contended "invalidation". 😕

Hi Gina, thanks for your reply. To be clear the actual "Plan Document" DOES NOT SPECIFICALLY address the "items" of contention. The actual BENEFICIARY DESIGNATION FORM and/or the SPDs for several years DO CONTAIN EXPLICIT LANGUAGE that state specific "items"/"conditions" that will cause the BENeFICIARY DESIGNATION FORM to be considered "invalid" by the Plan Administrator/named fiduciary (they're one-in-the-same in this instance)

Effen, I wish I could be more specific at this time. The fact is that the Estate of the original Plan participant is currently in the process of seeking to recover the monies disbursed. What is still currently being worked out is from whom monies will be sought (hence all the somewhat vague questions from me) and on what legal basis (hence my desire to research the legal basis, or lack thereof, of all the possible "responses" that the Plan Administrator MAY give as the rationale for their actions taken . As somewhat lacking in actual detail the facts that I have related may seem to be, believe it or not there are still other, more nefarious actions, that were undertaken by others (not the Estate or any of its benefactors). My hope is that after the issue at hand commences in court and if anyone is really interested, I will be able to discuss in greater detail what actually all occurred. In all the decades of my professional experience in operations and compliance ( I am not an attorney; I merely worked with them professionally on a regular basis on all sorts of "issues" that were encountered by myself and senior management at the financial institutions that employed me; in this case I am involved "personally" with the Estate of the deceased Plan participant), I don't know that I encountered a more convoluted situation with so many moving parts as it were. Thank you one and all for your insights, various references, and perhaps most importantly, your patience and indulgence in responding to questions that, unfortunately, cannot be related in a more precise manner currently!

No apology necessary! Yup, the named fiduciary/plan Administrator, who also happens to be the Plan's sponsor , seemingly disregarded(or overrode ostensibly via their discretionary authority) two "conditions" that were stated in writing; in one case the "condition" that was stated would cause a Beneficiary Designation form to be returned as "invalid" was printed both on the Plan's official Beneficiary Designation Form as well as stated in writing in multiple year's S.P.D.s . In the second instance, whereas some information related to the "condition" which would cause the Beneficiary Designation Form to be returned/rejected as "invalid" appeared on the Designation Form itself , the actual wording that "your Beneficiary Designation Form will be returned as invalid if....." only appeared in several years S.P.D.s and nowhere on the Beneficiary Designation Form itself . In BOTH INSTANCES the actual Plan Document , makes no mention of either of the two "conditions" in question(there are other conditions mentioned in the SPD) that would cause a Beneficiary Designation Form to be considered "invalid"; the Plan Document merely states in one particular section the aforementioned "discretion" wording. So the Plan Administrator/named fiduciary, went ahead and ostensibly disbursed the funds due upon the death of the original plan participant (who died after being fully vested but before they, themselves began drawing an benefits) to an individual designated as the "primary beneficiary" on the seemingly "invalid" Beneficiary Designation Form. If, instead, upon proper review, the plan administrator had determined that the Beneficiary Designation Form that had been submitted many,many years before the death of the plan participant by the plan participant themself was, in fact, "invalid"; then the Estate of the Plan Participant would have received the payout and not the "invalid" primary beneficiary. One important final note: I use the words "seemingly" and/or "ostensibly" with regards to the actions of the Plan Administrator inasmuch as the Plan Administrator has never FORMALLY stated, under oath or otherwise, that "they" relied upon the Beneficiary Designation Form in question (i.e. as the rationale for their choice of recipient of the plan benefit); even though the Plan Administrator DID RESPOND to a formal request for information regarding the disputed disbursement by providing the Beneficiary Designation Form with the "defects" as I outlined. Needless to say, this disputed disbursement will require further information to be gathered to "pin down" the actions of the Plan Administrator and then proceed accordingly . I have simply been trying to research , in advance, the legality of various potential "responses" that the Plan Administrator may give to our formal inquiry as to the basis for how they made their distribution. Thank you very much again for your response and information; I greatly appreciate it!

Thank you for your insight QDROphile. I guess my concern arises in the fact that the two known "overrides" by the named fiduciary/Plan administrator are their seeming disregard of two (2) separate "disqualifiers" ; one that is clearly stated in bold print on the beneficiary designation form itself as well as being stated as well in the annual S.P.D. mailed to the original Plan Participant and the second "disqualifier" as it were, is clearly stated in the S.P.D. So, I don't see how the named fiduciary/Plan Administrator could claim to use their "discretionary powers" granted under the Plan document, no matter how broadly stated or all-encompasing they may be, to override specific disqualifiers that they themselves established and included in writing in an "instrument" of the plan (beneficiary designation form) and in supplementary documentation of the Plan (S.P.D.).

One final point; which is something I addressed in a previous post a couple months back, the D.B. "Plan document " DOES GRANT the Named Fiduciary seemingly all encompassing powers to make determinations of fact, determine who the "rightful" beneficiary is ,etc. etc. As I asked then : "Could the Named Fiduciary" ignore/disregard/override written conditions on THEIR OWN forms and in their own S.P.D. ? Thanks!

Hello, What becomes the "controlling legal document(s)" in a case where a Defined Benefit Plan's actual "Plan Document" does not detail, nor address , specific instances under which a Beneficiary Designation Form will be considered invalid that ARE DETAILED on the Beneficiary Designation Form itself and/or the "Plan's" Summary Plan Descriptions for many years? Thank you in advance for any responses!

And since I said "said" so many times in my post; that's all I've got to say! 🐵

Greetings: Here is an interesting question: Say a fully-vested DB Plan Participant leaves (either voluntarily or involuntarily) the company providing said DB Plan. After several years, said employee returns to employment with the same company which is still offering the same DB Plan. Does the Plan Administrator need to have the employee/participant "reaffirm", in writing, the designated beneficiary for said benefit in the event of death of the participant? Thanks to all who reply in advance!

Hello All: GENERAL QUESTION not based on a specific example. In General Terms, for DB Plan Administrators who are granted "discretionary authority" by their Plan Documents, how much can they allow "exceptions" to written rules in the Plan's documents or Instruments before they face potential liability( i.e. potential litigation) for abuse of discretionary authority? THANKS IN ADVANCE!

Thank you very much DSG your analysis. IMHOit is "spot on" and yes , what you described in one of your scenarios is pretty much what occurred; hence my thought that the PA may, rhetorically speaking, "No Harm No Foul" with regards to this ahem, "misstatement" ;).

So most, if not all, plan administrators will ask a designated "Primary Beneficiary" (or anyone requesting a payout of a "benefit") to complete a "Benefit Claim Form". The format I am familiar with typically starts at the top by explaining the nature of the benefit including amounts and different options for payout(if applicable) from which the "beneficiary" may choose. Then what follows are a series of "declarations"; pre-printed on the "claim form" that the "beneficiary" confirms by checking a box next to each individual phrase/declaration. Finally, at the bottom of the claim form there is a signature and date line where the "beneficiary" (as I'm referring to them) is to sign and date the claim form. In print either directly above or below the signature line is language to the effect of : "By signing this form you confirm, under penalties of perjury the accuracy/correctness of your responses to the statements above". Now, say the person filling out the form "affirms" an obviously false statement, for example that they were still married to the deceased plan participant at ther time of their death, when, in fact, they are divorced from the deceased. Upon learning of the falsehood, which, potentionally, could affect a payout (or might not ala' Egelhof v. Egelhof) could the Plan Administrator deny/revoke/attempt to recover any "payout" or , in this particular instance, might the administrator, determine based on established caselaw such as Egelhof v. Egelhof for example, and say "No harm no foul" or would they be obligated to perform further due diligence and/or look to some outside legal authority, such as the courts, to make any final determination ?

Hello All, Yet another chapter in the ongoing saga of "Defined Benefit Issues". Question: Can a primary beneficiary, or for that matter ANY beneficiary have their right to a "benefit" voided/rescinded/revoked/etc. if said beneficiary makes a material misrepresentation ( signed written statement/assertion under penalty of perjury) to the Plan Administrator AFTER the original Plan Participant has passed(died) and before a "payout" has been made by the Plan/Plan's Administrator under the terms of said (ERISA-covered) Defined Benefit Plan ? Any thoughts and especially legal case citation would be IMMENSELY appreciated! Thanks!

Hello Luke, Answers 1) Yes 2) Very Yes Thank you for your input regarding interpleader!

@ Appleby First noting Peter Gulia's excellent response. At this time, I do not have the actual "Plan Documents"; just several year's SPDs. That being said, in the SPD's two statements are found 1) That any designated "contingent beneficary(ies) will ONLY(emphasis mine) inherit if none of the (designated) primary beneficiaries are alive at the time of death of the original plan participant. 2) Further on in the SPD it states "in the event there is NO VALID(again emphasis mine) primary beneficiary, any benefit will be paid to the Estate of the deceased participant". So imagine an instance where a plan participant has designated an individual who should not be the primary beneficiary for any one a several reasons (not going into particulars) . On the same beneficiary designation form, the then living plan participant also designates one or more "contingent beneficiaries". Now, the original plan participant dies and the Plan's administrator pays out the, for lack of a better term, "death benefit" to the designated primary beneficiary, who, again, should not be "eligible". the question then becomes who has "standing" to sue to recover: The participant's Estate or the "contingent beneficiary"? As Peter Gulia pointed out the SPD IS NOT a "PLAN DOCUMENT" and so, in my interpretation of Peter's answer, the actual plan documents are the best place to look for the answer. If anyone knows where there is a court that set precedence saying, in effect, irrespective of any "Plan document", the contingent beneficiary "gets promoted" , as you put it, to become the primary, please let me know.

Not to "Beat a Dead Horse", but the courts have ruled, have they not, that a Beneficiary Designatiuon Form is a "Plan Document" Correct? or a "Plan Instrument" ?

Thank you VERY MUCH Peter for your extremely informative and insightful answer! I will review the actual plan documents as such as move forward accordingly.

Hello All, Another vexing question to which we have conflicting answers. In the event that a "Primary beneficiary" of a ERISA -covered Defined Benefit Plan is determined to be invalid, what determines who the "Sucessor/New Primary Beneficiary" will be? In this partiicular instance, in addition to a "Primary beneficiary" , the completed form indicated a "Contingent Beneficiary". It should be noted that the "Plan Documents" (i.e. Summary Plan Description SPD) states, specifically, that the "Contigent Beneficiary" shall become the new "Primary Beneficiary" in the event the "Primary Beneficiary" is deceased; the document gives no other instance wherein the "Contigent Beneficiary" shall become the new "Primary Beneficiary" . The Plan documents ALSO states, specifically, that in the event that there is no VALID (emphasis mine) "Primary Beneficiary" the benefits shall be paid to the deceased plan partipant's Estate. The question is: Do the "Plan Documents" determine who is the new "Primary Beneficiary" or some other ruling authority ? Based upon the plan document wording specifically addressing the event of an "invalid Primary Beneficiary", would not the correct new "Primary Beneficiary" be the deceased plan participants Estate per the wording in the SPD? Thanks in advance for everyone's help!

Hello Effen, No "insured death benefit". The recently deceased had a pretty standard "old-school" Pension Plan from an employer they worked for many, many years earlier. Because "they" worked for the company many years ago and for a long period of time, two things occured: 1) They named their then "spouse" as primary beneficiary, 2) They were fully "vested" in the plan but when they died they had not begun to take benefits (they died before the minmum age to start recieving "benfits" of any type under the DB Plan). Many years later, after leaving the company, they divorced their previous spouse(who had previously been made the PRIMARY beneficiary). As stated prior, the MSA included specific language wherein the soon-to-be former spouse "waived" any interest of any sort in said DB Plan. The T.P.A. for the DB plan went ahead and paid out the lump-sum "death benefit" to the former spouse. It was a substantial sum and without a "valid" primary benficiary the sum would have been/should have been paid to the deceased's Estate which has several beneficiaries. More than one highly-regarded attorney has suggested pursuing action , post-distribution, in state court to recovery the monies. Hence the reason for my original question (the Estate falls within the purview of the Seventh District). Based upon caselaw generously supplied by previous posters (special thanks to Peter Gulia), it would appear that such a strategy would be destined to fail.

Hi Tom, I prefer not to get into too many details regarding the actual detailed circumstances at this time; as I anticipate legal action shortly on the matter and who knows who would be reading this. That being said, the "issue at hand" involves a Defined Benefit Plan that paid the death benefit of a recently deceased, fully vested, former plan participant, to their ex-spouse. The ex-spouse, as part of a Marital Settlement Agreement many years earlier , had specifically waived any interest whatsoever in the DB Plan; either in recieving a share of future payments or any potential death benefit .