Advocate Health Care Network v. Staptelton

Posted: January 1, 2017 by beguide in Uncategorized


Also includes the cases of Saint Peter’s Health Care System v. Kaplan, Dignity Health v. Rollins

WHAT HAPPENED:  Plaintiffs filed a class-action lawsuit against a religious non-profit on grounds that the retirement plan under which they belonged was not sufficiently funded.  Amongst other claims, plaintiffs argued that defendants should be governed by ERISA (the Employee Retirement Income Security Act of 1974), which monitors retirement programs to ensure they are compliant with federal law.  It should be noted that there are three other similar claims which have all been consolidated under this banner which involve the same fact pattern more or less.

WHY IS THIS BEFORE THE SUPREME COURT:  ERISA has an exception for churches, which is based on the policy that the government should not be interfering with “secretive Church business”.   If that doesn’t sound weird enough, the Court expanded this exception to apply to church-affiliated businesses that were not specifically churches, somehow reasoning that they too had secretive business that protected them from the preying eyes of ERISA watchdogs  (since apparently ERISA is a huge pain in the ass to deal with).  In the last year, the Second Circuit held that the exception no longer applies to church-affiliated businesses, and that the previous cases and interpretations were overruled.

WHAT ARE THE RAMIFICATIONS –  Let’s get this straight.  The government creates a law that has poorly worded terminology which the Courts make worse.  Private businesses rely on that terminology and create complicated programs around those interpretations.  Years later, aggrieved parties claim that the system was wrong to begin with and everything needs to be re-changed and re-booted, which is probably impossible when you’re dealing with the retirement accounts of thousands of retired individuals.   This feels a lot like the Affordable Care Act cases, just on a smaller scale, added elements of religion, and people coming on the exact opposite conclusion as they did for King v. Burwell.

ROOT FOR ADVOCATE HEALTH CARE NETWORK IF:  you would rather things be wrong as long as it doesn’t tip over the apple cart.

ROOT FOR STAPELTON IF: the pursuit of legislative perfection is worth ruining a couple thousand retirement accounts.

PREDICTION:  Advocate Health Care 7-1


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