The U.S. Supreme Court recently declined to address the issue of whether forum selection clauses are valid and enforceable in plans governed by the Employee Retirement Income Security Act of 1974 (ERISA). Three U.S. Courts of Appeals have allowed enforcement of plans’ forum selection clauses.
On January 16, 2018, the Supreme Court denied a petition for writ of certiorari filed by a participant in Caterpillar Inc.’s health plan. The participant had originally filed suit in Pennsylvania. Caterpillar successfully moved the case to the Central District of Illinois pursuant to the plan’s forum selection clause. After the participant’s motion for retransfer was denied, the U.S. Court of Appeals for the Seventh Circuit denied mandamus, holding forum selection clauses are enforceable in ERISA plans. In re Mathias, 867 F.3d 727, 734 (7th Cir. 2017), cert. denied sub nom. MATHIAS, GEORGE W. V. USDC CD IL, ET AL., No. 17-740, 2018 WL 411019 (U.S. Jan. 16, 2018). The Seventh Circuit adopted much of the reasoning of the Sixth Circuit, the first appellate court to address the issue. See Smith v. Aegon Companies Pension Plan, 769 F.3d 922, 932 (6th Cir. 2014). See more on the Seventh Circuit’s opinion here.
This is the third time in as many years that the high court has denied review of this issue. In the Smith case, the court sought the views of the Solicitor General, generally a sign of the court’s interest in a topic. The Solicitor General sided with the Department of Labor, which has filed amicus briefs in support of the participants in each of the appellate cases. However, the Solicitor General recommended that the issue percolate more in the appellate courts. Since then, the Eighth and Seventh Circuits have issued orders that align with the Sixth Circuit. And the Supreme Court has denied review of each of the decisions.
The majority of district courts also have found that forum selection clauses are consistent with ERISA’s venue statute, promote uniformity, and reduce litigation costs. But a few outlier district courts held that the forum selection clauses violate the policy behind ERISA’s venue provision, and the Sixth and Seventh Circuit opinions each had a dissent. Without a split among the circuit courts, however, it seems unlikely that the Supreme Court will weigh in on the issue.