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The future in litigation might be an arbitration provision

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The fascinating part of ERISA litigations is the changing law and viewpoints. To combat the rising tide of litigation, some companies have included arbitration provisions in their Plan document. That means participants can’t adjudicate their claims in court, they must in arbitration.

 

While being originally against, the Nine Circuit in Dorman v. Charles Schwab only covers that circuit; it does gain insight that arbitration provisions in a plan document may serve as a safety valve to limit litigation expenses and arbitrate disputes through binding arbitration.

 

I’m not suggesting that every plan sponsor adopt one in their plan document since again, it’s the Ninth Circuit, but it may give us some insight that it will become more popular and more acceptable.

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