Monday, September 29th, 2008...10:28 am
9th Cir: No Issue Exhaustion in ERISA
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The 9th Circuit distinguishes between issue exhaustion and remedy exhaustion, and decided this morning that ERISA requires the latter but not the former. Thus, a participant’s failure to argue reasons in an internal appeal does not prevent her or him from arguing thsoe reasons before the District Court.
The majority held:
Because ERISA and its implementing regulations create an inquisitorial, rather than adversarial process, and because the EOB does not notify a claimant that issue exhaustion is required, Sims leads us to conclude that Vaught was not required to exhaust his issues or theories in the context of this case.
Vaught v. Scottsdale Healthcare Corp., 20078 WL _______ (9th Cir. Sept. 29, 2008)
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