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Supreme Court Holds that a Plan?ÇÖs Clear Terms Prevail in Reimbursement Action

On April 16, 2013, the U.S. Supreme Court issued its decision in US Airways, Inc.?áv. McCutchen. In its opinion, the Court addressed whether equitable doctrines derived from the principle of unjust enrichment can override the clear terms of an ERISA benefit plan regarding rights to reimbursement from a third-party recovery. Mr. McCutchen was a participant in the US Airways group health plan (the ?Ç£Plan?Ç¥), which was governed by ERISA. After incurring claims under the Plan based on injuries he sustained in an automobile accident, McCutchen hired an attorney on a contingency fee basis to sue the driver of the other vehicle. McCutchen sought damages for medical costs, lost earnings, and other injuries. The lawsuit resulted in a settlement recovery, and McCutchen also obtained a payment from his own automobile insurer. After offsetting his total recovery by his attorney?ÇÖs contingency fee, McCutchen was left with a recovery that was less than… Continue Reading

May 2013
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