§ 4.3.7.1 STANDING, JURISDICTION, AND VENUE

• Jurisdiction: Arizona

§ 4.3.7.1 Standing, Jurisdiction, and Venue. Standing under ERISA has proven to be a troublesome concept notwithstanding the rather clear language of the statute. ERISA Section 502(a) specifically describes those civil actions which may be brought under ERISA and the parties who are authorized to bring those actions. Standing is thus determined by the nature of the claim. For example, some claims described in ERISA section 502(a) may only be brought by the Secretary of Labor.¹⁵⁷

Whether a former employee has standing to bring a claim under ERISA has been the subject of several cases. Generally, an individual must be either a participant or a beneficiary to have standing to sue under ERISA. However, an individual cannot be a participant unless he or she is an employee or former employee.¹⁵⁸ Thus, the plaintiff must generally be either a current participant, a current beneficiary receiving benefits, or have a reasonable expectation of receiving benefits that will vest or become available in the future before the individual can be said to have standing.¹⁵⁹

Former employees who terminate their participation in the plan generally lack standing to allege breaches of fiduciary duty resulting from subsequent offers of improved benefits.¹⁶⁰

The standing required for former employees was clarified by the Supreme Court in Firestone Tire & Rubber Co. v. Bruch.¹⁶¹ There, the Court found that a mere claim to participant or beneficiary status was insufficient. The plaintiff must, instead, prove that he or she is an employee, that he or she will fulfill the requirements for plan participation in the future, or that he or she will likely prevail in a dispute that directly involves whether the plaintiff will be able to fulfill the requirements for participation in the plan in the future or was wrongfully terminated from receipt of the benefits in the past.

A separate set of standing issues is presented when health care providers attempt to bring claims for ERISA benefits. Generally, health care providers do not fit within any of the categories of individuals in power to sue under the ERISA statute, and therefore lack standing in their own right. Health care providers can, however, accept an assignment of benefits from the participant and bring an action against the plan for nonpayment of those benefits.¹⁶² Although employee benefit plans can permit such assignments, at least one court has found that ERISA is not violated where the employee benefit plan prohibits such assignments of benefits.¹⁶³ Perhaps as importantly, the assignment itself may have the effect of extinguishing the claim assigned.¹⁶⁴

The U.S. Supreme Court has held that ERISA does not provide a plan with a method of enforcing the plan's reimbursement provisions against participants who may be liable to repay the plan for benefits previously advanced out of the proceeds of a personal injury recovery. Frequently, this issue arises where the plan paid for the medical expenses and a personal injury claim is settled later. The court held that there is no ERISA claim for indemnity unless...