Glanton

We consider whether prescription drug plan participants who have suffered no judicially cognizable injury may sue their plans’ fiduciaries under the Employee Retirement Income Security Act of 1974 (“ERISA”).

Facts

AdvancePCS is a pharmacy benefits management company (PBM). PBMs manage prescription drug benefit programs and seek to reduce their clients’ drug costs by pooling claims and negotiating volume discounts with pharmaceutical companies. Among AdvancePCS’s clients are employee welfare benefit plans sponsored by ALCOA and K-Mart.

When AdvancePCS receives a prescription from one of the plan participants, it decides whether to buy the drug (preferably from a seller with whom it has negotiated a discount), reject the claim or switch the participant to another drug.

AdvancePCS pays for the drugs with plan assets after accounting for the participant’s co-payment. Plaintiffs allege that, in addition to earning fees from the plans, AdvancePCS has secretly been keeping the spread between what it charges the plans for drugs and what it pays suppliers — a practice plaintiffs claim violates ERISA.

Plaintiff Tommie Glanton works for ALCOA and is a member of its prescription drug…