In what can be viewed as a victory for plan sponsors, the Supreme Court ruled on Monday that statute of limitation periods written into plan documents are valid, as long as those periods are “reasonable.” The court, however, declined to define “reasonable.”

“The Supreme Court eliminated any uncertainty as to whether or not plan sponsors and/or employers can insert a contractual limitations period within the plan document itself,” says Nicole Eichberger, a New Orleans-based lawyer in Proskauer’s employee benefits, executive compensation & ERISA litigation practice. “And it did so by saying that contractual limitation periods written into plan documents are valid as long as they are reasonable, without opining as to what constitutes a reasonable period.”

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