Daniel Aronowitz Tapped to Head EBSA

On February 11, 2025, President Trump named Daniel Aronowitz as his pick to serve as Assistant Secretary of the U.S. Department of Labor (DOL) Employee Benefits Security administration (EBSA). Aronowitz is currently the president of Vienna, Virginia-based Encore Fiduciary, which described itself in a recent amicus brief as a "fiduciary insurance underwriting company, serving many of the nation's largest single employer, multiemployer, and government employee benefit plans." The brief, filed in the Cunningham v. Cornell University litigation now before the Supreme Court, also states that "Encore provides thought leadership though a variety of channels, including whitepapers, a benchmarking study for recordkeeping fees, and the Fid Guru Blog." Aronowitz is listed as counsel for Encore Fiduciary on the brief, which asserts that the plaintiffs-petitioners' "construction of [ERISA] Section 1106 would turn ERISA's prohibited transaction provision on its head and open the door to widespread abuse." Aronowitz is a graduate of The Ohio State University and Vanderbilt University School of Law. Like prior EBSA Assistant Secretaries, Aronowitz must be confirmed by the Senate.

DOL Inks $20M Settlement with Third-Party Administrator Over ER and Drug Testing Claims

On February 7, 2025, DOL filed an unopposed Motion to Approve Consent Order and Judgment and accompanying memorandum to resolve a July 2023 complaint it filed against United Healthcare affiliate UMR, Inc. (UMR), alleging ERISA violations in connection with UMR's third-party administration of emergency room (ER) and urinary drug screening (UDS) claims. Micone v. UMR, Inc., No. 3:23-cv-00513 (W.D. Wisc.). DOL alleged in its lawsuit that UMR was an ERISA fiduciary and improperly denied ER claims based solely on diagnosis codes and not in accordance with the Affordable Care Act's (ACA) prudent layperson standard. The agency also asserted that UMR violated ERISA by failing to adhere to plan medical necessity standards when denying UDS claims. According to the settlement papers filed in court, UMR will pay "at least $20,250,000" to resolve DOL's ERISA claims and associated ERISA penalties and will discontinue use of the objected to claim administration policies and protocols "unless or until a change in the relevant law or regulations permits" their use. Pursuant to the proposed Consent Order and Judgment, UMR will use the settlement amount to pay participants and beneficiaries with affected ER and UDS claims and a penalty of 10 percent of the total payments made to participants and beneficiaries. The proposed Consent Order and Judgment sets forth various claim processing, notice, and documentation procedures required of UMR under the agreement.

DOJ Reverses Position on Constitutionality of Tennessee Gender-Affirming Care Ban 

On February 7, 2025, the U.S. Department of Justice (DOJ) notified the Supreme Court by letter that the Trump administration "has reconsidered the United States' position" in United States v. Jonathan Skrmetti, No. 23-477, a case currently pending before the Court. Skrmetti concerns the constitutionality of a Tennessee law, SB1, which prohibits healthcare providers from proscribing or administering puberty blockers or hormone therapy to minors for the purpose providing gender-affirming care. In August 2024, the U.S. intervened in support of the individual plaintiffs challenging the law, arguing in its briefing and at oral argument in December 2024 that the law is unconstitutional because it violates the Equal Protection Clause of the Fourteenth Amendment. In its recent letter to the Court, the DOJ stated, "The Department has now determined that SB1 does not deny equal protection on account of sex or any other characteristic," though it nevertheless urged the Court to decide the case. The letter notes that the "Court's prompt resolution of the question presented will bear on many cases pending in the lower courts," and the private plaintiffs still involved in the suit prevent the case from becoming moot.

The plaintiffs, a group of parents and their transgender minors in Tennessee, were granted a preliminary injunction by the district court, which found that SB1 likely violated both the Equal Protection Clause, by discriminating on the basis of sex and transgender status, and the Due Process Clause, by interfering with the rights of parents to make decisions concerning care for their children. The Sixth Circuit reversed the preliminary injunction, finding that the plaintiffs had not demonstrated a likelihood of success on the merits on either of their constitutional claims. The U.S., as intervenor, petitioned the Supreme Court to take the case only on the Equal Protection claim, which the Court granted. At oral argument in December 2024, the Court pressed then-Solicitor General Elizabeth Prelogar on whether the prohibitions of SB1 should be understood as sex classifications subject to heightened scrutiny, with multiple Justices appearing to express skepticism that the law discriminated on the basis of sex.

Upcoming Speaking Engagements

Joanne and Elizabeth will speak at the ABA 2025 Midyear Tax Meeting on February 20. 

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