ERISA LITIGATION UPDATE: The Exhaustion of Administrative Remedies under ERISA and the Federal Courts’ Split on Whether "Exhaustion" Applies to Statutory Claims

Most plan administrators are familiar with the long-standing concept in the law that individual claimants must "exhaust administrative remedies" before filing a lawsuit to recover benefits under the plan. Stated more plainly, prior to filing a lawsuit for benefits, a participant or beneficiary must first submit a claim to the plan pursuant to the claims procedure in the plan document, and if that claim is denied, he or she must then pursue an administrative appeal in accordance with the plan's claims procedures. Do not waste your time combing through ERISA to read the precise language of the exhaustion requirement. You will not find it. There is nothing in ERISA that specifically requires a claimant to exhaust his or her administrative remedies before filing a lawsuit for benefits. The exhaustion requirement is entirely a judicially-created doctrine. The exhaustion requirement has been universally adopted by all of the federal circuits, but it is not necessarily rigidly applied. Courts have recognized a few exceptions where exhaustion of administrative remedies may not be required.