Ryan M. LoRusso

Abstract

A recent report to the United States Congress indicated that about 131 million Americans are currently enrolled in employee benefit plans governed by the Employee Retirement Income Security Act of 1974 (ERISA). Some plans are structured so that the plan administrator pays benefits out of the firm’s profits, creating the possibility that the administrator may be swayed to decide in the company’s favor to protect its financial health. In Metropolitan Life Insurance Co. v. Glenn, the Supreme Court addressed whether such an administrator operates under a conflict of interest and, if so, how that conflict should be considered on judicial review. Prior to Glenn, the circuit courts had adopted varying approaches to this apparent conflict. This note begins with an overview of trust law principles relevant to the Court’s reasoning, then reviews pre-Glenn case law, discusses the Glenn decision, and examines subsequent developments. It argues that the Supreme Court was correct to hold that this scenario constitutes a conflict of interest and to permit circuit courts to account for the conflict by weighing it alongside other relevant factors.

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