employment of the employer of the plan.” Id. at 117. The case was then remanded to the Third Circuit to determine whether the claimants were “participants” within the meaning of 29 U.S.C. 1002(7). Id. at 109. b. A Closer Look at the Brunch OpinionIn Brunch, Firestone raised five separate points why the Court should apply the arbitrary and capricious standard of review to an administrator’s decision. First, Firestone argued that prior case law applied the arbitrary and capricious standard of review to ERISA claims. Second, even though the plan did not specifically give the plan administrator the power to use his discretion to interpret terms of the plan, the administrator’s position was an ”inherently discretionary function.” Third, Firestone argued that the arbitrary and capricious standard should be used because the plan administrator is a fiduciary. As such, any exercise of authority by a fiduciary is discretionary and therefore subject to an arbitrary and capricious review. Fourth, Firestone argued that since Congress failed to adopt an amendment that included a mandatory de novo review for all ERISA actions, Congress’ intent was to keep the arbitrary and capricious standard. Finally, Firestone made the argument that applying a de novo review would undermine ERISA’s purpose and encourage appeals and civil suits from benefit denials. Brunch at 109. The Court stated that the above arguments applied to the LMRA reasoning for the use of the arbitrary and caprious review, however, that same standard will not be “imported” into ERISA’s administration. Id. at 109-10. The Court stated that the arbitrary and capricious standard of review that was previously developed under the Labor Management Relations Act of 1947 (LMRA) was not the appropriate standard of review for ERISA claims. Id. at 102. The Court determined that the arbitrary and capricious stan...
