Copeland Oaks v. Haupt, 209 F.3d 811 (6^th Cir. 2000); 2000 FED App. 0125P (6th Cir.)-This court affirmed the district court's application of the "make-whole" rule of federal common law, which requires that an insured be made whole before an insurer can enforce its right to subrogation under ERISA unless there is a clear contractual provision to the contrary.  Here, the language in the plan failed to include language "opting out" of the make-whole rule.

            Brooke Haupt, a minor, incurred serious and permanent injuries in an auto accident.  Her father, Jeffrey Haupt filed claims with his employer's Plan for her medical expenses, and pursued a claim against the negligent driver of the vehicle in state court.  The Copeland Oaks Plan sought subrogation.

This court specifically rejected Copeland Oaks' argument that simply because its plan administrator was subject only to the "arbitrary and capricious" standard of review, the court should defer to the administrator's interpretation that the provision did expressly opt out.  If this were the case, any plan could avoid the make-whole rule by giving plan administrator's discretion to interpret plan language.  This court thus held that for plan language to conclusively disavow the default rule, it must be specific and clear in establishing both a priority to the funds recovered and a right to any full or partial recovery.