Cases & Deals

OPM's regulations regarding designation of beneficiary are challenged

Clients Office of Personnel Management (OPM)

In Christensen v. OPM, Jones Day successfully challenged as arbitrary and capricious regulations of the Office of Personnel Management (OPM) that govern where and when a Designation of Beneficiary must be filed to be effective. The federal government operates two retirement systems, the older Civil Service Retirement System (CSRS) and the replacement Federal Employees Retirement System (FERS). Under CSRS, to be valid a Designation of Beneficiary must be received by OPM prior to the designating employee's death. Under FERS, a designation of beneficiary received by the employing office or agency is valid.

In Christensen, OPM rejected as invalid a designation of beneficiary that was received by the employing office, the U.S. Department of Labor, several months before the designator died of cancer. Unfortunately, Labor did not send the Designation of Beneficiary to OPM until the day after the designating employee died. Nevertheless, OPM asserted that its CSRS regulation required receipt by OPM before death. Administrative appeals arguing that OPM was unlawfully treating employees covered under CSRS differently from employees covered under FERS were summarily rejected by OPM and then the Merits Systems Protection Board.

The Firm appealed to the United States Court of Appeals for the Federal Circuit, asserting that OPM and MSPM had acted arbitrarily and had failed to engage in reasoned decision-making. The Department of Justice responded to the Petitioner's Brief by asking to settle the matter by paying out the deceased employee's remaining pension assets as originally requested.

Christensen v. OPM