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(District of New Jersey D.C. 01-cv-04183) - page 27 / 30





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extended obligations under the common law of trusts to reach entities which had not been deemed to be trustees under the common law, however, Congress did not intend to expand the full panoply of trustees’ obligations to every entity which might be designated a fiduciary under ERISA. Specifically, Congress provided that the assets of an insurance company need not be held in trust. 29 U.S.C. § 1103(b)(1)-(2). For that reason, we do not believe that Congress intended to impose upon insurance companies doing business with ERISA-regulated plans the same disclosure obligations that have been imposed upon trustees at common law. Section 1103(b)(1)-(2) excepts insurers from trustee-like obligations; we see no reason to impose trustee-like disclosure obligations upon an entity excepted from ERISA’s analogy to trust. Thus, simply because an insurer has certain limited fiduciary obligations under ERISA, those obligations are not coextensive with the common law obligations of a trustee.

We do not suggest that an insurer servicing an ERISA plan owes no disclosure obligations to plan beneficiaries. Indeed, under 29 U.S.C. § 1133(a), an insurer-fiduciary denying a claim for benefits must disclose the specific reasons for the denial. But we do conclude that the disclosure obligations of an insurer-fiduciary cannot be defined through rote application of the common law of trusts.

Two additional factors convince us that Health Net’s disclosure obligations do not require it to reveal the advice it obtains from its own retained counsel. First, the fiduciary obligations of insurers who contract with ERISA plans are not well-settled at law. Definition of those obligations often will be one of the most hotly contested issues in a lawsuit. It would be


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