Federal Court Awards Spousal Death Benefits to Same-Sex Spouse in Wake of DOMA Ruling

Following the U.S. Supreme Court’s ruling in June that section three of the Defense of Marriage Act (DOMA) is unconstitutional with respect to the federal government’s ban on recognizing same sex marriages, a federal district court recently ruled that the same-sex spouse of a deceased profit-sharing plan participant is entitled to spousal death benefits under the terms of the plan and ERISA. The case is Cozen O’Connor v. Tobits.

The plan was an ERISA-qualified plan that required, upon the death of a participant to the plan, the plan administrator to pay death benefits in the form of a Qualified Pre-Retirement Survivor Annuity. Following the death of the participant, there were two competing claims between the surviving spouse and the participant’s parents. In response, the plan sponsor filed an interpleader action to determine the proper beneficiary.

The court noted that the plan contained several features of an ERISA-qualified plan, such as requirements that in order to qualify as a spouse, the individual must be married to the participant for a least one year; that a spouse must waive his or her right to be the participant’s beneficiary in writing; and that the death benefits shall go to the surviving spouse absent a spousal waiver. The couple was first married in Canada, and later celebrated that marriage with another ceremony in Illinois. The plan, however, did not define the term “spouse.”

In ruling that the same-sex surviving spouse is the proper recipient, the U.S. District Court for the Eastern District of Pennsylvania found that Supreme Court’s ruling in Windsor made clear that “where a state has recognized a marriage a valid, the United States Constitution requires that the federal laws and regulations of this country acknowledge that marriage.”

“Post-Windsor, where a state recognizes a party as a ‘Surviving Spouse,’ the federal government must do the same with respect to ERISA benefits—at least pursuant to the express language of the ERISA-qualified Plan at issue here,” wrote District Judge Darnell Jones, II.

Following this decision and the Supreme Court’s Windsor decision, similar benefit claims and ERISA-based cases are likely to arise in other jurisdictions throughout the country. For additional discussion on this case and this issue, please read the Covington & Burling update.

The case is available here.