Opinion ID: 568597
Heading Depth: 2
Heading Rank: 1

Heading: Standard of Review of Administrator's Determination

Text: 9 Eley argues that the district court erred in reviewing the administrator's determination for abuse of discretion rather than de novo. We hold that the district court applied the proper standard of review. 10 In Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115, 109 S.Ct. 948, 956, 103 L.Ed.2d 80 (1989), the Supreme Court held that denials of benefits were to be reviewed under a de novo standard unless the benefit plan gives the administrator or fiduciary discretionary authority to determine eligibility for benefits or to construe the terms of the plan. If the benefit plan gives the administrator discretionary authority, review for abuse of discretion is required. See id. at 114-15, 109 S.Ct. at 956 (stating that the Court could not conclude that Congress intended that arbitrary and capricious review be employed and using term abuse of discretion to describe appropriate standard of review); Jones v. Laborers Health & Welfare Trust Fund, 906 F.2d 480, 481 (9th Cir.1990) (applying abuse of discretion standard). 1 11 The provisions of the Boeing plan 2 are comparable to plan provisions we have previously held to confer discretion. See, e.g., Dytrt v. Mountain State Tel. & Tel. Co., 921 F.2d 889, 894 (9th Cir.1990) (plan administrator given authority  'to determine eligibility for benefits or to construe the terms of the plan'  (quoting Bruch, 489 U.S. at 115, 109 S.Ct. at 956)); Jones, 906 F.2d at 481 (Board of Trustees shall have power ... to construe the provisions of this Trust Agreement and the Plan, and any such construction adopted by the Board in good faith shall be binding.); Batchelor v. International Bhd. of Elec. Workers Local 861 Pension & Retirement Fund, 877 F.2d 441, 442-43 (5th Cir.1989) (plan administrator given full and exclusive authority to determine all questions of coverage and eligibility). See also Boyd v. Trustees of United Mine Workers Health & Retirement Funds, 873 F.2d 57, 59 (4th Cir.1989) (trustee given authority to make full and final determination as to all issues concerning eligibility for benefits and to promulgate rules). We hold that the plan gives the administrator ... discretionary authority to determine eligibility for benefits or to construe the terms of the plan. Bruch, 489 U.S. at 115, 109 S.Ct. at 956. 12 The Bruch Court also stated that if a plan bestows discretionary authority upon an administrator who is operating under a conflict of interest, the conflict must be considered in determining whether an abuse of discretion has occurred. Id. at 115, 109 S.Ct. at 956 (quoting Restatement (Second) of Trusts § 187, Comment d (1959)). We have held that if the employer is the administrator, a conflict ordinarily exists. Dytrt, 921 F.2d at 894 & n. 4 (quoting Bruch, 489 U.S. at 115, 109 S.Ct. at 956). In determining that Boeing did not abuse its discretion, the district court did not consider Boeing's role as both plan administrator and employer, apparently because Eley had not claimed that Boeing had acted in bad faith or with an improper motive. Boeing argues that even if the district court erred in requiring an allegation of improper motive, Blue Shield's role as contract administrator mitigates any potential conflict of interest. Blue shield made the initial plan interpretation and uses the same definition for other employer plans. Boeing also notes that collective bargaining produced the language of the plan. We need not decide whether the district court erred in declining to weigh Boeing's dual role. Even if Boeing has an interest in broadly construing the preexisting condition exclusion, Boeing's interpretation of the term is consistent with the plain language of the plan. 13