A long-standing judicial struggle exists regarding the application of the statute of limitations in cases involving a breach of fiduciary duty under the Employee Retirement Income Security Act. The U.S. Court of Appeals for the 9th Circuit has addressed the issue of actual knowledge, the statute of limitations, and ERISA disability claims involving a breach of fiduciary duty. While there is a split between circuits, this decision could impact New Jersey residents if the split is ultimately resolved by the Supreme Court.
Role of ERISA
ERISA is a federal law that establishes oversight for pension plans, retirement accounts, and other employer-provided benefits, including health and disability insurance. The focus of the split has been on disability claims affecting those individuals of retirement age.
Breach of fiduciary duty
Situations can arise in which a party bearing a fiduciary duty to an individual covered by ERISA breaches that legal obligation in some manner. A question can arise as to whether the statute of limitations has expired before the aggrieved individual taking legal action. Indeed, a common defense to a breach of fiduciary duty claim arising from an ERISA relationship is that the statute of limitations has run.
Impact of the statute of limitations
In basic terms, the statute of limitations is the law that establishes the time frame within which a person can bring legal action. If a lawsuit is not filed within the time period established by the statute of limitations, a plaintiff can be barred from seeking legal redress.
Actual knowledge of a breach initiates the running of the statute of limitations
When it comes to ERISA disability claims involving an alleged breach of fiduciary duty, the 9th Circuit has ruled that the statute of limitations starts running when a person has actual knowledge of that breach.
ERISA disputes generally, and those involving the statute of limitations specifically, are complex. Successfully navigating these cases is best achieved with capable legal representation.