Venue Clause in Pension Plan Affirmed by Sixth Circuit

A Kentucky district court dismissed the claims of a former employee regarding termination of enhanced compensation benefits under his pension plan. The case was dismissed due to a clause in the pension plan that set the venue for all claims in a specific Iowa court. The employee appealed, and through an amicus brief the U.S. Department of Labor (DOL) sided with the employee based on the argument that ERISA and venue selection clauses are incompatible.

In Smith v. AEGON Cos. Pension Plan,the Sixth Circuit affirmed the lower court and held the venue selection clause enforceable. The court noted that this was the majority opinion for courts that have faced this issue and that a prohibition on venue clauses for ERISA-governed pension plans was an issue for Congress.

See Stacey Cerrone & Russell L Hirschhorn, Sixth Circuit Declines Deference to DOL and Enforces Venue Selection Clause, The National Law Review, Oct. 24, 2014.

Special thanks to Jim Hillhouse (Professional Legal Marketing (PLM, Inc.)) for bringing this article to my attention.