As reported by BNA Daily Report for Executives [subscription required], another decision has been handed down in a series of cases filed over the last 18 months challenging the assertion by a number of Catholic health care companies that their pension plans qualify as "church plans," and are thus exempt from the funding and other requirements of ERISA. In Medina v. Catholic Health Initiatives, (D CO, July 9, 2014), a Colorado federal magistrate judge recommended entering a declaratory judgment finding that the plan is not a church plan. Refusing to defer to the position taken by the IRS in a 2002 Private Letter Ruling, the magistrate judge followed the lead of two out of three other courts that have ruled on the issue and held that to qualify as a church plan, the plan must be established by a church or association of churches, and not merely by a church-affiliated organization. (See prior related posting.)
Meanwhile one more similar challenge has been filed, bringing the total number of cases pending or decided to 8. The complaint (full text) in Lann v. Trinity Health Corp., (D MD, filed 7/11/2014), not only claims that the health care organization's plan does not qualify as a church plan, but argues that if it does, the exemption in ERISA for church plans violates the Establishment Clause.