By: Kathleen Cahill Slaught and Michelle M. Scannell

Sixth Circuit judges might not expect holiday cards from the folks at the DOL this year.  In a recent opinion involving ERISA venue selection clauses, the court ruled that the DOL’s amicus curiae—(“friend of the court”)—brief was a mere “expression of mood” that wasn’t entitled to judicial deference.  (Smith v. AEGON Cos. Pension Plan, 6th Cir. No. 13-5492 (10/14/14)).  The court ultimately disagreed with the DOL’s stance that ERISA forbids venue selection clauses.  Indeed, venue selection clauses are alive and well in the Sixth Circuit and elsewhere. (See, e.g., Rodriguez v. PepsiCo LTD Plan, 716 F. Supp. 2d 855, 861 (N.D. Cal. 2010); Klotz v. Xerox Corp., 519 F. Supp. 2d 430, 436 (S.D.N.Y. 2007)).

As we know, the DOL often offers its two cents in private litigation by filing amicus briefs to announce its position on a disputed issue.  Here, the Sixth Circuit noted that the “Secretary of Labor has been particularly aggressive in attempting to mold statutory interpretation and establish policy” by filing amicus briefs in private litigation.  The court also noted that that the DOL had never before advanced its stated view on venue selection clauses through an enforcement action, regulation, or opinion letter.  The DOL had voiced this opinion only once before—in an amicus brief in a sister circuit.

The DOL didn’t request deference here. Yet the court considered whether the DOL was entitled to it, under either of two types of administrative deference recognized by the Supreme Court: “Chevron” and “Skidmore” deference.  Chevron deference may apply to an agency’s statutory interpretation where a statute is ambiguous or silent on an issue and the agency’s interpretation is a permissible one.  The court found that the DOL wasn’t entitled to such deference because its interpretation was unsupported by regulation, ruling, or administrative practice.

Under Skidmore deference, courts consider several factors in determining whether to defer to an agency’s statutory interpretation, including the thoroughness evident in the agency’s position, validity of its reasoning, and consistency with earlier and later statements on an issue.  The court found that such deference didn’t apply here.  Specifically, the DOL was “no more an expert” than the court in determining whether a statute forbid venue selection.  Also, the DOL’s “new interpretation” was inconsistent with its “prior acquiescence” to venue selection clauses.  The DOL’s position also “lacked longevity.”  The court thus viewed the DOL’s stance as a mere “expression of mood” not entitled to deference.  Ouch.

The court went on to hold that the plan’s venue selection clause was presumptively valid and enforceable.  The court found that such clauses do not place an excessive burden on participants, are not forbidden by ERISA, and further ERISA’s goal of uniform administrative schemes and low-cost plan administration.

This decision is unlikely to thwart the DOL’s active amicus program in ERISA cases and elsewhere.  But it’s nice to know that the Sixth Circuit recognizes limits on the agency’s ability to influence private litigation absent statutory support or past involvement in an issue.