Eleventh Circuit drops ERISA exhaustion rule for statutory claims

By Daniel Okafor

On October 13, 2026, the full U.S. Court of Appeals for the Eleventh Circuit, sitting en banc (the entire court), overruled Mason v. Cont’l Grp., Inc., 763 F.2d 1219 (11th Cir. 1985), and held that Employee Retirement Income Security Act of 1974 (ERISA) statutory claims do not require exhaustion of a benefit plan’s administrative remedies before federal litigation.

In Bolton v. Inland Fresh Seafood Corp. of Am., Inc., No. 24-10084, 2026 WL 3056461, the court called the displaced rule “a textual product of judicial creation based solely on policy reasons.” Employer counsel can no longer use failure to exhaust as a ground to dismiss a statutory claim in the circuit.

For employers and plan administrators, the change is procedural, not a new substantive benefits duty. The court expressly left unresolved exhaustion for disputes challenging the denial of benefits under plan terms.

What does the ruling change for employers?

Administrative remedies exhaustion generally means the internal processes specified by a benefit plan that a claimant must follow before seeking federal court review of a claim. Courts have required it for several practical reasons:

• Give plan administrators an opportunity to correct errors.
• Promote consistent interpretation of plan terms.
• Let administrators apply their expertise and discretion in managing plan assets.
• Limit excessive judicial intervention.
• Build a complete factual record if a court must step in.

ERISA and later Department of Labor regulations require plans to give participants a process for obtaining a full and fair review of the plan’s decision on a claim. ERISA itself does not expressly require claimants to use that process; courts created the requirement as a matter of judicial discretion.

What was the case about?

A group of seafood workers appealed the U.S. District Court for the Northern District of Georgia’s dismissal of their proposed class action alleging mismanagement of an employee stock ownership plan. Under 29 U.S.C. §§ 1132(a)(2) and 1132(a)(3), they alleged:

• Defendants breached fiduciary duties by causing the plan and participants to overpay for common stock.
• The plan’s trustee failed to conduct proper diligence before settling on the purchase price.

The district court dismissed the claims because Mason required administrative exhaustion for the workers’ ERISA statutory claims. On review, the Eleventh Circuit expressly overruled Mason and rejected that exhaustion rule.

The court also noted that removing exhaustion for statutory claims would align the Eleventh Circuit with seven other circuits:

• The Third, Fourth, Fifth, Sixth, Ninth, Tenth and D.C. Circuits already followed the no-exhaustion approach for ERISA statutory claims.
• The Seventh Circuit remained the only outlier, although its rule for ERISA statutory claims was not mandatory. The court cited Lindemann v. Mobil Oil Corp., 79 F.3d 647, 650 (7th Cir. 1996).

What remains unchanged for benefit-denial claims?

The headline is broad; the holding is not. The court limited its ruling to statutory claims and expressly did not address exhaustion for disputes challenging the denial of benefits under plan terms.

Statutory claims here concern alleged violations of ERISA or fiduciary duties, rather than a challenge to the denial of a benefit owed under the plan. For those statutory claims, employers in the Eleventh Circuit can no longer seek dismissal solely because a participant did not complete the plan’s internal review.

That does not erase internal review. Case law across the circuits generally requires exhaustion for claims alleging wrongful denial of plan benefits, subject to limited exceptions. Plans must still operate the full-and-fair-review process required by ERISA and Department of Labor regulations.

For HR and benefits teams, the practical effect resembles rerouting one category of mail, not replacing the internal claims office. The classification of a dispute as a statutory claim or a benefit-denial claim will determine whether a federal suit may proceed directly.

How could the next legal fight develop?

Employer-side attorneys may test whether plaintiffs have recast benefit-denial disputes as statutory claims, or duplicated a denial claim through another theory. If the statutory claim is, in substance, a claim for benefits, the plan’s administrative process remains the required route under existing precedent.

In Rochow v. Life Insurance Co. of North America, 780 F.3d 364, 372 (6th Cir. 2015) (en banc), the Sixth Circuit held that a plaintiff seeking benefits under § 1132(a)(1)(B) could not recover for a fiduciary breach under § 1132(a)(3) when related to the denial. A fiduciary claim required an injury separate and distinct from that denial.

In Diamond v. Local 807 Labor Mgmt. Pension Fund, 595 F. App’x 22, 25 (2d Cir. 2014), cert. denied, 135 S. Ct. 2806 (2015), the Second Circuit upheld dismissal of an alleged fiduciary breach because the claim required interpretation of plan documents, despite its “framing the claim as a statutory violation.”

Plaintiffs can point to Bolton for the opposite textual argument: ERISA contains no affirmative requirement to exhaust administrative remedies, even for denial-of-benefits claims, so courts should stop treating exhaustion as a judicial invention. Bolton did not resolve that question, however, and longstanding precedent makes the challenge an uphill battle.

For employers, the immediate task is classification, not claims-administration redesign: the court has narrowed one defense while leaving benefit-denial review in place.