Ninth Circuit Reviews Choice-of-Law in ERISA Case

The Ninth Circuit is reviewing the case of William White v. Guardian Life Insurance Company, focusing on the enforceability of a choice-of-law provision in an ERISA plan. White, a resident of California, was denied accidental death and dismemberment benefits from his employer’s plan, which is governed by federal ERISA regulations and features a choice-of-law clause favoring Florida law. This clause has significant implications due to California Insurance Code Section 10110.6, which prohibits discretionary clauses in insurance plans, unlike Florida, where no such prohibition exists.

The central issue at the district court revolved around whether the choice-of-law provision should be upheld, considering various factors such as the employer's location and the issuance timeline of the policy. The court acknowledged the precedent set by the Ninth Circuit in Wang Laboratories, which dictates that such provisions are enforceable unless deemed unreasonable. Ultimately, the district court concluded that Florida law was applicable to the case and validated the discretionary clause.

The ongoing appeal has attracted attention with briefs from both sides, including consumer advocacy and insurance industry groups, indicating the case's importance in determining the interplay between state insurance laws and ERISA regulations. The Ninth Circuit's forthcoming decision will clarify if California’s restrictions can be sidestepped via choice-of-law provisions and set precedents for similar future cases.