The U.S. Supreme Court case UNUM Life Insurance Company of America v. John E. Ward, 1998 revolved around the interpretation and application of an insurance policy governed by the Employee Retirement Income Security Act (ERISA). The plaintiff, John E. Ward, filed a claim for disability benefits under his employer's long-term disability plan insured by UNUM Life Insurance Company of America after he was diagnosed with HIV/AIDS but was denied coverage due to late filing according to the terms in his policy contract. He then sued UNUM in California state court alleging bad faith denial of benefits and breach of fiduciary duty among others. UNUM removed the case to federal court arguing that ERISA preempted all state law claims related to employee benefit plans including those based on alleged violations of duties imposed by insurance contracts regulated under state law like Mr.Ward’s claim for bad faith denial. The main issue before the Supreme Court was whether ERISA preempts such claims or not? The Supreme Court ruled in favor of Mr.Ward holding that while ERISA does preempt some state laws relating to employee benefit plans it doesn’t apply when a lawsuit is brought against an insurer for alleged violation(s) arising from its processing or handling an individual’s claim(s) for benefits payable solely because that person has satisfied certain conditions stated within their insurance contract.

In the dissenting opinion for UNUM Life Insurance Company of America v. John E. Ward, Justice Scalia disagreed with the majority's interpretation of ERISA (Employee Retirement Income Security Act). He argued that it was not Congress' intention to allow state law claims related to insurance contracts under ERISA plans, as this would undermine the uniformity and simplicity intended by federal regulation. He also contended that allowing such claims could lead to a patchwork system where different states have varying rules about what constitutes an unreasonable delay or denial of benefits, which is contrary to ERISA’s goal of providing a single set of administrative procedures for disputes over benefits. Furthermore, he expressed concern that permitting these types of lawsuits might discourage employers from offering employee benefit plans due to potential litigation costs and risks.