2000 - ERISA

<body topmargin=0 leftmargin=0 marginheight=0 marginwidth=0> <table cellpadding=0 cellspacing=0 border=0><tr> <td valign="top" colspan=2 height=90 BGCOLOR="#006699" TEXT="#080000" background="04a085a3.jpg"> <div> <FONT SIZE="5" COLOR="#FFFFFF" FACE="Arial" ><B>Kreiner & Peters Co., L.P.A.</B></FONT><B>    </B><B> |     </B><A HREF="index.htm" TARGET="_top" TITLE="Kreiner Peters Co., L.P.A."><U><B>home</B></U></A></div> <div> <A HREF="id46.htm" TARGET="_top" TITLE="December 2004 Subrogation under Legisla"><U>December 2004 - Subrogation under Legislative Scrutiny</U></A><B>   |   </B><A HREF="id41.htm" TARGET="_top" TITLE="November 2004 Lawson"><U>November 2004 - Lawson</U></A><B>   |   </B><A HREF="id40.htm" TARGET="_top" TITLE="November 2004 Restitution"><U>November 2004 - Restitution</U></A><B>   |   </B><A HREF="id45.htm" TARGET="_top" TITLE="August 2004 Rental"><U>August 2004 -  Rental</U></A><B>   |   </B><A HREF="id37.htm" TARGET="_top" TITLE="February 2002 ERISA"><U>February 2002 - ERISA</U></A><B>   |   </B><A HREF="id36.htm" TARGET="_top" TITLE="November 2001 ERISA"><U>November 2001 - ERISA</U></A><B>   |   </B><A HREF="id35.htm" TARGET="_top" TITLE="November 2001 Evidence"><U>November 2001 - Evidence</U></A><B>   |   </B><A HREF="id34.htm" TARGET="_top" TITLE="June 2001 Intentional Acts"><U>June 2001 - Intentional Acts</U></A><B>   |   </B><A HREF="id33.htm" TARGET="_top" TITLE="May 2001 Fiduciary"><U>May 2001 - Fiduciary</U></A><B>   |   </B><A HREF="id32.htm" TARGET="_top" TITLE="April 2001 ERISA provisions"><U>April 2001 - ERISA  provisions</U></A><B>   |   </B><A HREF="id31.htm" TARGET="_top" TITLE="January 2001 ERISA"><U>January 2001- ERISA</U></A><B>   |   </B><A HREF="id30.htm" TARGET="_top" TITLE="2000 ERISA Fiduciary"><U>2000 - ERISA Fiduciary</U></A><B>   |   </B><A HREF="id29.htm" TARGET="_top" TITLE="2000 Medical Payments"><U>2000 - Medical Payments</U></A><B>   |   </B><B>2000 - ERISA</B></div> <div> </div> </td> </tr><tr> <td valign="top" width=210 BGCOLOR="#FFFFFF" TEXT="#080000" background="04bd2e83.jpg"> <bR> </td> <td valign="top" height=390 BGCOLOR="#FFFFFF" TEXT="#080000"> <div> <I>2000 - ERISA</I></div> <div> <B>ERISA PLAN LANGUAGE VERSUS</B></div> <div> <B>THE COMMON FUND DOCTRINE</B></div> <bR> <div> All too often a participant's attorney will ask the plan, its administrator, insurer, or carrier to reduce their demand for a pro-rata share of fees and expenses. The participant's attorney presents such a reduction as fair because the attorney made the recovery. A reduction for pro-rata share of fees is often referred to as the "Common Fund" doctrine. </div> <bR> <div> Several Circuits have addressed application of the "Common Fund" doctrine to ERISA claims of subrogation and reimbursement. The majority of Circuits reject application of the "Common Fund" doctrine to ERISA plan rights of reimbursement and/or subrogation. See <U>Harris v. Harvard Pilgrim Health Care, Inc.</U>, 208 F.3d 274 (1st Cir. 2000); <U>Walker v. Wal-Mart Stores, Inc.</U>, 159 F.3d 938 (5th Cir. 1998); <U>United McGill Corp. v. Stinnett</U>, 154 F.3d 168 (4th Cir. 1998); <U>Bollman Hat Co. v. Root</U>, 112 F.3d 113 (3rd Cir. 1997); <U>Health Cost Controls v. Isbell</U>, 139 F.3d 168 (6th Cir. 1997). </div> <bR> <div> In <U>Harris v. Harvard Pilgrim Health Care Inc.</U>, the First Circuit reversed the lower court's application of the "Common Fund" doctrine which would have reduced the plan's reimbursement rights. The court held "the district court order directing HPHC to defray a pro rata share of the Harrises' attorney fees must be vacated." <U>Harris</U>, 208 F.3d at 279. In its opinion, the court stated "[i]t therefore follows that an ERISA plan which unambiguously requires its member to reimburse the plan for all benefits paid does preclude offset for attorney fees." <U>Id.</U>, at 278 (citation omitted). The Circuit's ruling said that no ambiguity existed in the plan's language which provided the plan can recover "from a Member the value of services provided, arranged, or paid for, when the Member was reimbursed for the cost of care by another party." <U>Id.</U> pg 276 <U>Harris</U> clearly rejects application of the "Common Fund" doctrine to reimbursement obligations contained in ERISA plans.</div> <bR> <div> The Sixth Circuit Court of Appeals rejected application of the "Common Fund" doctrine in <U>Health Cost Controls v. Isbell</U>, 139 F.3d 168 (6th Cir. 1997). In affirming the Kentucky district court, the court found that a reduction for attorney fees would "undermine" the terms of the plan requiring full reimbursement." Likewise, the Third Circuit in <U>Bollman Hat Co. v. Root</U> rejected any reduction saying "the policies underlying ERISA generally counsel reliance on unambiguous plan language." <U>Bollman Hat</U>, 112 F.3d at 118 (citation omitted).</div> <bR> <div> In each of these cases, the court's ruling clearly turns on the language in the plan. Under ERISA, the plan can recover without reduction for the "Common Fund" or pro-rata share of attorney fees when the plan language provides a clear right of reimbursement to the extent of payments by the plan.</div> <bR> <div> ©2000 Kreiner & Peters Co., L.P.A.</div> <bR> <div> <B>This is an advertisement</B></div> <bR> <bR> </td> </tr></table></body>