Covington handles the full range of litigation, audits, investigations, and government enforcement actions involving employee benefit plans. Our experienced ERISA litigators draw on the technical skills of one of the best advisory practices in the country to produce exceptional results for our clients. We also provide creative pre-litigation and settlement advice to reduce the risks and costs of litigation.
Litigation
Covington represents clients such as Verizon, IBM, General Electric, Union Pacific, the National Football League, and The ERISA Industry Committee in employee benefits litigation. We have won cases that run the gamut from large class actions involving hundreds of millions of dollars to benefit claims brought by individual employees. Recent cases handled by our ERISA litigators include:
- On behalf of IBM, winning the first decision by a federal court of appeals that cash balance plans are not inherently age discriminatory;
- Representing Harris Trust and Savings Bank, as trustee of the Ameritech pension trust, before the U. S. Supreme Court in a case establishing the right of a plan fiduciary to sue a non-fiduciary party in interest;
- Defending AK Steel and Verizon in class actions alleging age discrimination and improper calculation of benefits under cash balance plans;
- Representing Schering-Plough in an ERISA “stock drop” class action;
- Representing United Technologies in a “revenue sharing” class action;
- Defending Capital Cities/ABC, General Electric, the NFL, Verizon, and the Pharmaceutical Research and Manufacturers of America against claims that independent contractors were entitled to benefits under company plans; and
- Defending IBM and Verizon against fiduciary breach claims alleging misrepresentation in voluntary separation programs.
On behalf of our client The ERISA Industry Committee, we have filed amicus briefs in dozens of ground-breaking cases in the U. S. Supreme Court and federal courts of appeal. We have also filed amicus briefs on behalf of other clients, including PricewaterhouseCoopers, Mercer, and Towers Perrin.
Audits and Investigations
Covington has a superb record in audits, investigations, and enforcement proceedings. Our lawyers have held important posts at most of the federal agencies that oversee employee benefits. Drawing on the experience of these lawyers, we have successfully represented clients in matters before the IRS, the Labor Department, the EEOC, the Pension Benefit Guaranty Corporation, the Centers for Medicare and Medicaid Services, the SEC, and state regulatory agencies. In a number of cases we have persuaded federal agencies to abandon enforcement proceedings in which they originally sought millions of dollars in damages and penalties. We have also persuaded federal regulators to provide valuable support for our clients’ positions in private disputes.
Covington advises and represents clients in connection with self-audits and voluntary compliance procedures. We have conducted comprehensive compliance audits of our clients’ retirement plans, and we have helped clients correct administrative problems—some of them quite serious—through the voluntary compliance programs at the IRS and Labor Department. Our experienced associates and non-lawyer professionals are able to handle benefit plan audits and voluntary compliance applications cost-effectively.
Pre-Litigation and Settlement Advice
We bring our skills and experience to bear in a variety of ways to reduce our clients’ litigation risks. For example, we have:
- Helped companies revise their procedures for offering company stock through their benefit plans in light of recent litigation;
- Prepared guidelines for paying administrative expenses from plan assets in a way that will satisfy IRS and Labor Department auditors;
- Drafted plan provisions designed to increase companies’ control over where and when they may be sued for benefits; and
- Advised on insurance coverage for benefit plan fiduciaries.
Covington frequently settles employee benefits disputes on favorable terms. Our lawyers excel at designing cost-effective settlements that maximize the tax benefits of all parties, and that can be paid from existing benefit plan assets. We are experienced at addressing fiduciary issues and obtaining government approvals necessary to implement settlements.
Benefit Claims
Covington also resolves individual benefit claims efficiently both in administrative appeals and in court. We frequently help our clients build an administrative record that discourages claimants from bringing suit, or that positions a dispute for favorable resolution once it reaches the courts. We have successfully litigated a number of individual benefit claims on behalf of General Electric, Verizon, IBM, and other clients.
Representative Matters
- Harris Trust and Savings Bank v. Salomon Smith Barney, Inc., 530 U.S. 238 (2000).
The U.S. Supreme Court reversed summary judgment against our client Harris Trust, as trustee of the Ameritech pension trust, and held that ERISA permitted a fiduciary to sue a non-fiduciary party in interest that had participated in a prohibited transaction.
- Cooper v. IBM Personal Pension Plan, No. 05-3588 (7th Cir. Aug. 7, 2006). In the first decision on this issue by a federal court of appeals, the Seventh Circuit ruled unanimously that IBM’s cash balance plan was not age discriminatory.
- Edes v. Verizon Communications Inc., 417 F.3d 133 (1st Cir. 2005). The First Circuit affirmed summary judgment in favor of our client Verizon on claims by contract employees that they were entitled to participate in company benefit plans.
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