#SCOTUS Asks for a Response in ERISA Case that Could Revive Retirement Plan Arbitration Clauses
The U.S. Supreme Court has asked a former Capital Group employee to respond to the investment firm’s bid to send her retirement plan suit to arbitration. The case, Capital Group Cos. Inc. v. Pover, No. 26-267, asks whether a single retirement plan participant filing suit under the Employee Retirement Income Security Act can recover losses suffered by other participants’ accounts, or only in her own.
The answer could decide whether retirement plans can enforce arbitration clauses that bar plan-wide relief.
The former employee and defined contribution retirement plan participant, Cathy Pover, had initially waived her right to respond to Capital Group’s petition. Because of the Court’s Oct. 1 request, the justices will now have Pover’s opposition in hand before deciding whether to take the case.
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Capital Group, a Los Angeles-based global asset manager, amended its employee retirement plan in 2020 to require individual arbitration of plan-related claims. The amendment barred participants from bringing claims on a “class, collective or representative basis.” It also provided that if a court struck down that waiver, representative claims would go to court instead of arbitration.
Pover filed suit under ERISA Section 502(a)(2), which allows a participant to act on behalf of the plan for “appropriate relief.” She alleged that Capital Group kept five under-performing funds in its plan because they generated fee income for the company, and she sought relief for the plan as a whole. Capital Group moved to compel arbitration, and the district court denied the motion.
A divided Ninth Circuit panel affirmed, 2-1, with Circuit Judge Danielle J. Forrest writing and Circuit Judge Jacqueline H. Nguyen joining. Pover v. Capital Group Cos. Inc., No. 24-5298 (9th Cir. 2026).
The panel held the waiver unenforceable under the effective vindication doctrine, a judge-made exception to the Federal Arbitration Act that bars enforcement of arbitration terms that prospectively waive federal statutory remedies. Relying on its decision in Platt v. Sodexo S.A., 148 F.4th 709 (9th Cir. 2025), the panel held that the waiver stopped Pover from filing suit on the plan’s behalf, which ERISA expressly allows.
The panel also rejected Capital Group’s argument that LaRue v. DeWolff, Boberg & Associates Inc., 552 U.S. 248 (2008), limits a defined-contribution plan participant to recovering losses in her own account. LaRue held that a participant could file suit over fiduciary breaches that harmed her individual account. It didn’t decide whether a participant can also recover for losses in other participants’ accounts. Because the plan’s own terms send representative claims to court if the waiver fails, the case stays in court.
Circuit Judge Lawrence VanDyke dissented. He read “representative” in the waiver, alongside “class” and “collective,” as reaching only class-type suits, not a participant’s suit on behalf of the plan. He drew that distinction from Viking River Cruises Inc. v. Moriana, 596 U.S. 639 (2022). He would also have enforced the plan’s delegation of threshold arbitrability questions to the arbitrator, noting that the waiver’s bar on representative suits did not “prevent Pover from bringing claims on behalf of the Plan in arbitration.”
The Ninth Circuit’s decision was addressed on CPR Speaks. See Caroline Hillier, “Ineffective Vindication: Ninth Circuit Sends ERISA Conflict to Court, Not Arbitration,” CPR Speaks (Aug. 12, 2026) (available here).
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Capital Group’s petition doesn’t challenge the effective vindication doctrine directly. Instead, it targets the ERISA question underneath it: whether “appropriate relief” under Section 502(a)(2) includes monetary recovery to other participants’ accounts. If a participant can recover only for her own account, a plan limiting her to individual arbitration takes away no statutory remedy, and the effective vindication objection largely falls away.
Capital Group characterizes the disagreement as a “1–7 circuit split.”
On one side, it places the Fourth Circuit’s decision in Trauernicht v. Genworth Financial Inc., 169 F.4th 459 (4th Cir. 2026 (available at https://bit.ly/48raBfX). In reversing certification of a mandatory class, that court held that a participant’s monetary recovery is limited to losses in her own account.
On the other side, the company lists the Ninth Circuit and six other circuits, including Cedeno v. Sasson, 100 F.4th 386 (2d Cir. 2024), and Parker v. Tenneco Inc., 114 F.4th 786 (6th Cir. 2024).
Those courts refused to enforce plan arbitration provisions that blocked plan-wide relief. The cases arose in different procedural settings: Trauernicht on class certification and the others on arbitration, and whether they squarely conflict is for the Court to weigh.
The Supreme Court declined to review both Cedeno and Parker when they came up as arbitration disputes. Capital Group’s petition presents the question as one of ERISA remedies instead.
The petition argues that the majority view misreads LaRue. It also argues that letting one participant recover for everyone’s accounts, without class certification and its procedural protections, raises standing and due process problems. It asks the Court to resolve whether ERISA gives individual participants “such breathtaking, unsupervised power.”
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While the nation’s top Court had scheduled the case for a conference on the cert decision for Sept. 23, it asked for Pover’s brief in opposition after a Sept. 18 request for the opposition brief by Capital Group. Pover’s brief is due Dec. 2. Her counsel, Charles Henry Field, San Diego-based co-cice chairman of Sanford Heisler Sharp McKnight, told Law360 that he intends to show the Court that no circuit split exists, calling Capital Group’s argument an attempt “to force a square peg into a round hole.”
The petition and related filings can be found on the Court’s docket page, here.
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The author, a third-year law student at the Northeastern University School of Law in Boston, is a CPR Institute fall intern.
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