13‐4532‐cv (L)
Roganti v. Metro. Life Ins. Co.
UNITED STATES COURT OF APPEALS
FOR THE SECOND CIRCUIT
August Term 2014
Argued: November 21, 2014
Decided: May 14, 2015
Nos. 13‐4532‐cv (L), 13‐4684‐cv (XAP)
_____________________________________
RONALD A. ROGANTI,
Plaintiff‐Appellee‐Cross‐Appellant,
‐ v. ‐
METROPOLITAN LIFE INSURANCE COMPANY, METROPOLITAN LIFE RETIREMENT PLAN
FOR UNITED STATES EMPLOYEES, SAVINGS AND INVESTMENT PLAN FOR EMPLOYEES OF
METROPOLITAN LIFE AND PARTICIPATING AFFILIATES, THE METLIFE AUXILIARY
PENSION PLAN, THE METROPOLITAN LIFE SUPPLEMENTAL AUXILIARY SAVINGS AND
INVESTMENT PLAN,
Defendants‐Appellants‐Cross‐Appellees.
_____________________________________
Before: JACOBS, RAGGI, and LIVINGSTON, Circuit Judges.
Appeal from a November 22, 2013 judgment of the United States District
Court for the Southern District of New York (Engelmayer, J.) in favor of plaintiff
Ronald Roganti (“Roganti”) on his claim for pension benefits under the Employee
1
Retirement Income Security Act of 1974 (“ERISA”) against defendants the
Metropolitan Life Insurance Company (“MetLife”) and four MetLife‐administered
retirement plans in which Roganti is a participant. On appeal, defendants argue
(1) that the district court erred in denying their motion to dismiss Roganti’s ERISA
claim on res judicata and collateral estoppel grounds, and (2) that the district court
erred in concluding that their denial of Roganti’s benefits claim was arbitrary and
capricious. We agree with defendants’ second argument, so we reverse. In light of
this disposition, we affirm the district court’s denial of Roganti’s request for
attorney’s fees, from which Roganti has cross‐appealed.
REVERSED IN PART, AFFIRMED IN PART.
DAVID G. GABOR, The Wagner Law Group, Boston,
MA, for Plaintiff‐Appellee‐Cross‐Appellant.
MICHAEL H. BERNSTEIN (John T. Seybert, on the brief),
Sedgwick LLP, New York, NY, for Defendants‐
Appellants‐Cross‐Appellees.
DEBRA ANN LIVINGSTON, Circuit Judge:
Plaintiff‐appellee‐cross‐appellant Ronald Roganti (“Roganti”) was a
successful executive with defendant‐appellant‐cross‐appellee Metropolitan Life
Insurance Company (“MetLife”1) until 2005, when he resigned in the face of pay
reductions that he claims were levied in retaliation for his opposition to unethical
business practices. Roganti brought arbitration proceedings against MetLife before
1
Roganti also named as defendants four MetLife retirement plans in which he is a
participant. See infra note 2 and accompanying text. In the remainder of this opinion, we
will refer to MetLife alone as the defendant for simplicity’s sake.
2
the Financial Industry Regulatory Authority (“FINRA”), seeking, among other
things, wages that he would have been paid but for the retaliatory pay reductions,
as well as compensation for the decreased value of his pension, which was tied to
his wages. The FINRA panel awarded Roganti approximately $2.49 million in
“compensatory damages,” but its award did not clarify what that sum was
compensation for. Roganti then filed a benefits claim with MetLife, arguing that the
award represented back pay and that his pension benefits should be adjusted
upward as if he had earned the money while he was still employed. MetLife denied
the claim because the FINRA award did not say that it was, in fact, back pay.
Roganti brought this lawsuit.
The Employee Retirement Income Security Act of 1974 (“ERISA”), 29 U.S.C.
§ 1001 et seq., creates a private right of action to enforce the terms of a benefit plan.
29 U.S.C. § 1132(a)(1)(B). Roganti’s pension plans vest interpretive discretion in the
plan administrator, which means that the plan administrator’s benefits decision is
conclusive unless it is “arbitrary and capricious.” Pagan v. NYNEX Pension Plan, 52
F.3d 438, 441 (2d Cir. 1995). After a summary bench trial on stipulated facts, the
district court (Engelmayer, J.) determined that MetLife’s denial of Roganti’s claim
was arbitrary and capricious because it was clear from the arbitral record that the
3
award did represent back pay. We reverse. For the reasons stated below, we
conclude that MetLife’s denial of Roganti’s claim was not arbitrary and capricious,
and that MetLife is therefore entitled to judgment in its favor as to Roganti’s benefits
claim. In light of this decision, we affirm the district court’s denial of Roganti’s
request for attorney’s fees, from which Roganti has cross‐appealed.
BACKGROUND
According to his complaint in this action, Roganti began working for MetLife
as an account representative in 1971. Over the course of the next three decades, he
was promoted multiple times, becoming a Vice President and the Managing
Director of a New York business unit called R. Roganti & Associates, as well as the
Executive Director of Agencies at another MetLife business unit known as the Tower
Agency Group. Roganti’s compensation rose significantly over the course of his
career, and particularly between 1994, when he earned $351,000, and 2001, when he
earned a high of $2.007 million.
Roganti alleges that beginning in 1999 and continuing until his retirement in
2005, his relationship with MetLife deteriorated as a result of his objections
regarding unlawful, inappropriate, and unethical conduct at the company. Among
various allegations, Roganti claims that a subordinate of his, Dorian Hansen, came
4
under fire in 1999 for opposing fraudulent business practices employed by some
MetLife insurance salespeople. As part of a campaign against Hansen’s efforts to
end these practices, Roganti was allegedly told to fire her; when he refused, the
Tower Agency Group was dissolved, affecting Roganti’s compensation. Roganti
alleges that he thereafter continued to oppose illegal and unethical conduct, and that
MetLife further reduced his compensation in retaliation. As a result, Roganti filed
a retaliation complaint with the Occupational Safety and Health Administration
(“OSHA”) in 2003, under the Sarbanes–Oxley Act of 2002 (“SOX”), Pub. L. No. 107‐
204, 116 Stat. 745 (codified in relevant part at 18 U.S.C. § 1514A). The complaint was
dismissed, however, when OSHA’s preliminary investigation did not validate
Roganti’s claims. A second complaint, filed in January 2004 and alleging further acts
of retaliation, was dismissed in November of that year.
In July 2004, while the second OSHA complaint was still pending (and some
eight months before he retired), Roganti commenced FINRA arbitration proceedings
against MetLife. In the arbitration, Roganti advanced three theories of recovery in
addition to his claim that MetLife had violated SOX by retaliating against him for
opposing its business practices and for filing a SOX complaint: (1) breach of contract,
for the alleged breach of MetLife’s commitment to make certain payments to him
5
for overseeing the Tower Agency Group; (2) quantum meruit, to recover the
reasonable value of services Roganti had provided, but for which he had been
underpaid; and (3) ERISA violations, on the theory that MetLife had violated the
statute by reducing Roganti’s compensation for the purpose of diminishing his
pension benefits. Roganti’s statement of claim contained two separate paragraphs
describing his request for relief. The first requested “back pay, liquidated damages,
compensatory and punitive damages, attorneys fees and an accounting.” J.A. 45.
The second—in the statement of claim’s “Wherefore” clause—sought an accounting
of R. Roganti & Associates’ revenues and expenses; “appropriate back pay, front pay
and reimbursement for lost benefits”; liquidated damages; punitive damages; and
attorney’s fees and costs. J.A. 60–61.
The arbitration did not conclude until 2010, after a seventeen‐day hearing.
Roganti’s counsel made clear throughout the proceedings that Roganti was focused
on recovering two categories of damages: damages for “lost comp[ensation]” and
“damages for the collateral effect [on] his pension benefits which are directly tied
to his comp[ensation].” J.A. 2881; see also, e.g., J.A. 2891 (stating that Roganti “seeks
nothing more than the compensation and pension benefits that he worked for and
earned” (emphasis added)). Roganti is entitled to pension benefits by virtue of his
6
participation in four MetLife retirement plans (the “Plans”) and, as previously
noted, he claimed before the arbitral panel that MetLife had reduced his
compensation for the specific purpose of limiting the growth of his sizable pension.2
In his summation to the FINRA panel, Roganti’s counsel explained how these two
damages components should be calculated based on the evidence presented during
the arbitral hearing.
As to the first component of damages—i.e., for lost compensation (or what
Roganti’s attorney referred to as “back pay”)—Roganti retired in 2005, when he was
55 years and six months old, but he testified that he would have continued working
at MetLife until age 62 had his compensation not been reduced. Roganti’s counsel
therefore argued that the panel should determine what Roganti would have earned
not only in the years 2003 to 2005 had the company not reduced his compensation,
2
The four Plans, which Roganti named as defendants in this lawsuit along with
MetLife itself, are (1) the Metropolitan Life Retirement Plan for United States Employees,
(2) the Savings and Investment Plan for Employees of Metropolitan Life and Participating
Affiliates, (3) the Metlife Auxiliary Pension Plan, and (4) the Metropolitan Life
Supplemental Auxiliary Savings and Investment Plan. The differences in the Plans’ terms
are not relevant to the issues presented in this case, so we will refer to the Plans collectively
in the remainder of this opinion. As noted earlier, all four of the Plans give MetLife, as plan
administrator, discretionary authority over benefits decisions. See, e.g., J.A. 2856 (“Benefits
will be paid under the Plan only if the Administrator, or its delegate, determines in its
discretion that the applicant is entitled to them.”).
7
but also (because he would not have retired) what he would have earned through
September 2010.3
The evidence showed that Roganti’s pay rose significantly from 1994 through
2001, and then decreased markedly: he earned $1.168 million in 1998, $1.24 million
in 1999, $1.406 million in 2000, and $2.007 million in 2001, before his compensation
declined to $1.506 million in 2002, $475,000 in 2003, $383,000 in 2004, and $67,000 for
the first quarter of 2005, after which he retired.4 Based on these sums, Roganti’s
counsel proposed three scenarios for determining Roganti’s lost compensation. The
first assumed that Roganti’s compensation would have increased four percent
annually from an estimate of his expected 2002 earnings contained in MetLife’s
pension files, yielding total lost compensation—Roganti’s “but for” earnings from
2003 to 2010 minus the sum of his actual earnings from 2003 to 2005 and the actual
pension payments that he had received thereafter—of $14.768 million. The second
scenario assumed that Roganti’s compensation would have remained flat at $1.506
3
Roganti’s counsel chose to calculate compensation through September 2010
because the date coincided with the expected end of the FINRA proceeding and with
Roganti’s 61st birthday. Because Roganti argued that he would not have retired until he
turned 62, he also asked for additional compensation during that final year of employment.
4
For the sake of completeness, Roganti earned $351,000, $412,000, $549,000 and
$756,000 in, respectively, 1994, 1995, 1996, and 1997.
8
million (i.e., what he actually received in 2002), yielding a lower total lost
compensation figure of $7.350 million. The third scenario effectively split the
difference between the first two, yielding total lost compensation of roughly $11
million.
With respect to the second component of damages—i.e., for pension benefits
to which Roganti would have been entitled but for the retaliatory decrease in his
compensation (or what Roganti’s attorney sometimes called “front pay”)—the
panel heard extensive testimony regarding how Roganti’s benefits were calculated
under the Plans. As Michael Bailey, an Assistant Vice‐President and Corporate
Actuarial at MetLife, explained (in testimony that was generally consistent with
testimony from both Roganti and Robert Benmosche, MetLife’s CEO), Roganti’s
retirement benefits were primarily a function of two variables: his pre‐retirement
compensation and his retirement age. Had Roganti retired at age 62, he would have
been entitled to an annual benefit based on his five highest‐earning years within his
last fifteen years of employment at MetLife. However, this annual benefit was
subject to an “early retirement discount” of four percent per year: retiring at 61
would mean receiving 96 percent of the annual benefit, retiring at 60 would mean
9
receiving 92 percent of that benefit, retiring at 59 would mean receiving 88 percent,
and so on. J.A. 2894.
Based on an assumption that Roganti’s remaining life expectancy in 2010 was
roughly twenty years, Roganti’s counsel advanced a proposal, during his
summation, as to how the arbitral panel ought to use the foregoing evidence to
award Roganti damages for his decreased pension benefits. Based on MetLife’s own
projections of Roganti’s pension had he not retired in 2005 (which assumed four
percent annual growth from his actual 2002 compensation), Roganti would have
been entitled to about $120,000 a month in pension benefits, or about $830,000 more
per year than he had been receiving. Aggregated over twenty years, that difference
would amount to lost benefits of about $17 million. Alternatively, Roganti’s counsel
estimated that by virtue of Roganti’s early retirement alone, even with no increase
in compensation above what he had actually earned during his five highest‐earning
years, he had suffered a loss of about $3.42 million in benefits as a result of the early
retirement discount.
Roganti’s counsel acknowledged, however, that the calculation of a pension
award involves some measure of speculation. Most notably, if Roganti’s
compensation during any year between 2002 and his retirement would, but for
10
MetLife’s unlawful pay reductions, have been higher than the compensation he
earned during one of his prior five highest‐earning years, that higher figure would
properly replace the lower one for calculating his pension. Thus, as an alternative,
Roganti’s counsel suggested that the panel could avoid calculating Roganti’s
pension by simply deciding what Roganti would have earned while still employed
through age 62 (i.e., by choosing a back pay award), and then instructing MetLife to
determine Roganti’s entitlement to pension benefits based on that increase in
compensation. As he put it:
But once again, I don’t want to be unduly speculative. So to the extent
this panel has concerns about awarding front pay in specific amounts,
I submit that an award should be rendered which says assume Ron had
earned such and such through the date of his retirement at 62 and,
MetLife, give him the appropriate pension amounts based on that. Met
can adjust its pension.
. . . .
. . . [T]o completely eliminate the speculation, the answer is to have Met
adjust Ron’s pension based on a retirement of 62 and based on earnings
of either 2 million or 1.5 million or some other higher or lower figure
through 62. This panel can do that. They can order Met to adjust Ron’s
pension accordingly or to buy an annuity so that he receives those
payments for the rest of his life . . . .
J.A. 2290.
The panel’s chairman, making clear that neither side “should infer anything
from [the] question,” then inquired whether the proposed “front pay part of [the]
11
calculation,” representing the loss of pension payments into the future, shouldn’t
be discounted to the present value of such payments, “if it is going to be reduced
into an award.” J.A. 2291. Roganti’s counsel agreed that this was necessary, that
“[t]his should be present valued, this $17 million if you are going to award it that
way.” J.A. 2291. He added, “that was one of the reasons I was addressing to the
panel the alternative possibility of Met issuing its own annuity, adjusting the figures
accordingly according to what Ron’s compensation would be if he worked to 62.”
J.A. 2291. The panel chairman then concluded this discussion by noting that “under
the scenario that we give you everything you want,” the chairman himself could do
the discounting: “I mean, I have a calculator, I could do it.” J.A. 2291.
On August 28, 2010, the FINRA panel issued an award in Roganti’s favor.
Consistent with the first above‐quoted paragraph in Roganti’s statement of claim,
the award noted that Roganti had requested “unspecified compensatory damages,
unspecified punitive damages, an accounting of R. Roganti & Associates’ revenues
and expenses, appropriate back pay, front pay and reimbursement for lost benefits,
attorneys’ fees, costs, disbursements, interest, and such further and additional relief
as the Panel may deem just and proper.” J.A. 63. The arbitration panel further
12
noted that Roganti had requested compensatory damages in the range of $11,483,000
to $32,764,506. Under the heading “Award,” the award stated simply:
After considering the pleadings, the testimony and evidence presented
at the hearing, the Panel has decided in full and final resolution of the
issues submitted for determination as follows:
1. [MetLife] is liable for and shall pay to [Roganti] compensatory
damages in the amount of $2,492,442.07 above its existing pension and
benefit obligation to [Roganti].
2. Any and all relief not specifically addressed herein, including
punitive damages, is denied.
J.A. 64. The award did not state the basis on which the panel had found MetLife
liable, did not say what the “compensatory damages” were intended to compensate
Roganti for, did not allocate the damages to particular years of Roganti’s
employment, and did not instruct MetLife to recalculate Roganti’s pension benefits
based on the award or to purchase an annuity.
On March 24, 2011 (roughly seven months after the panel issued its award),
Roganti filed a benefits claim with MetLife, in its capacity as administrator of the
Plans, arguing that the award was compensation for income that MetLife had
unlawfully denied him while he was employed there, and that this increase in his
pre‐retirement earnings justified an increase in his benefits under the Plans.
13
Roganti’s claim was denied, first on June 16, 2011 by Karen Dudas, and then, after
Roganti appealed Dudas’s decision, on August 30, 2011 by Andrew Bernstein,
MetLife’s Plan Administrator. Dudas and Bernstein informed Roganti that an
award of general “compensatory damages” was not benefits‐eligible compensation
under the Plans, and that nothing in the award indicated that it was intended to
compensate him for wages he should have earned during his employment at
MetLife, much less for wages attributable to particular years of service.5 As Dudas
explained:
In the Relief Requested section of the Award document,
“compensatory damages” are mentioned separately from back pay,
front pay and reimbursement for lost benefits. The Award document
specifically states that any and all relief not specifically addressed is
denied. Rather than requiring the Award be included in your
compensation earned as an Employee (by requiring treatment as back
pay) or included in benefit eligible compensation, the Award document
specifically labels the relief as “compensatory damages” (separate and
apart from any pension and benefit obligation) and denies any and all
5
Attribution of benefits‐eligible compensation to a particular year of employment
is pertinent principally because, as previously noted, Roganti’s pension (approximately
$610,000 per year prior to this litigation) is based on the average of his highest five years
of earnings during the fifteen years preceding his retirement. Thus, as Dudas stated, “even
assuming that the Award or any part thereof would be considered Annual Compensation
under the Retirement Plans in order to calculate the appropriate benefits, . . . [i]n the
absence of an allocation to a particular year or over particular years it is not clear what, if
any, impact on benefit accruals the Award would have.” J.A. 831.
14
other types of requested relief—including categorization of the award
as back pay, front pay or reimbursement for lost benefits.
J.A. 830. Accordingly, MetLife concluded, “[w]e do not see a reasonable basis in the
Award document for treating the Award as benefit eligible compensation earned
while you were an Employee.” J.A. 832.
Roganti commenced this action in the United States District Court for the
Southern District of New York on January 9, 2012, after his appeal at MetLife had
been denied. His complaint alleged that in denying his benefits claim, MetLife had
violated the terms of the Plans (so Roganti was entitled to relief under ERISA) as
well as the anti‐retaliation provisions of both SOX and the Dodd–Frank Wall Street
Reform and Consumer Protection Act (“Dodd–Frank”), Pub. L. No. 111‐203, 124
Stat. 1376 (2010) (codified in relevant part at 15 U.S.C. § 78u‐6). The parties
stipulated to the dismissal of the Dodd–Frank claim on April 30, 2012. MetLife then
moved to dismiss the ERISA and SOX claims for failure to state a claim, and on the
ground that they were barred by res judicata and collateral estoppel because Roganti
had already sought increased pension benefits from the FINRA panel.
On June 18, 2012, the district court issued an opinion dismissing the SOX
claim for failure to state a claim, but denying MetLife’s motion to dismiss the ERISA
15
claim. Roganti v. Metro. Life. Ins. Co., No. 12 Civ. 161 (PAE), 2012 WL 2324476
(S.D.N.Y. June 18, 2012) (“Roganti I”). With respect to the latter claim, the district
court held that if the FINRA award represented back pay, then it would be benefits‐
eligible compensation under the Plans. Id. at *6. But because the language of the
award itself “d[id] not come close to reliably resolving whether or not the award
represented back pay,” the district court found it necessary to remand the case to
MetLife, as plan administrator, to conduct “a close review of the arbitral record” and
determine based on that review “whether or not the award represented back pay.”6
Id. at *8. (Although the relevant arbitration procedures permitted Roganti to seek
clarification of the award from the arbitrators, the three‐month period for doing so
had passed. Id.) The district court issued an order remanding to MetLife on June
29, 2012. Special App’x 17–19.
On remand, MetLife’s Bernstein adhered to his earlier determination. In a
submission dated September 14, 2012, he stated that despite having reviewed the
arbitration hearing transcript and exhibits, he had uncovered neither “evidence . . .
6
The district court rejected MetLife’s res judicata and collateral estoppel arguments
on the ground that Roganti’s claim in this federal action arose after the arbitration and,
therefore, that Roganti could not have had a “full and fair opportunity to litigate that issue
in the prior arbitral forum.” Roganti I, 2012 WL 2324476, at *4–5.
16
of any mathematical or formulaic calculation that would allow [him] to identify the
specific nature of the Award,” nor “evidence of the arbitrat[ion] panel’s intent to
consider any potential award as eligible for consideration when determining
Roganti’s retirement benefits.” J.A. 2897. In the absence of such evidence, Bernstein
reasoned that the panel’s failure to indicate that it was awarding Roganti only back
pay—even though it knew he was seeking to recover for his reduced pension
benefits—reflected a conscious choice by the panel to “award[] an amount in the
form of compensatory damages . . . to take care of all of Roganti’s claims during the
arbitration.” J.A. 2900 (emphasis added).
In light of Bernstein’s submission, the parties agreed to have the district court
resolve their dispute by way of a summary bench trial on a stipulated factual record.
On September 25, 2013, the district court issued an opinion agreeing with Roganti
that the award represented back pay and holding that Bernstein’s decision reaching
the opposite conclusion was arbitrary and capricious. Roganti v. Metro. Life Ins. Co.,
972 F. Supp. 2d 658 (S.D.N.Y. 2013) (“Roganti II”).
In concluding that the award was back pay, the district court adopted what
it viewed as a “coherent explanation” proffered by Roganti for what the award
represented. Id. at 668. Specifically, if the panel had (1) assumed, consistent with
17
Roganti’s second back pay scenario, that his pay would have remained flat at its
2002 level of $1.506 million; (2) declined to credit his testimony that he would not
have retired in 2005 but for the retaliatory pay reductions; and (3) awarded him the
difference between $1.506 million annually and his actual earnings from 2003 to his
retirement in 2005, then the resulting award would have been $2,492,461.53—just
$19.46 more than the panel actually awarded him. Id. at 668–69. Because Bernstein
had failed either to rebut this theory or offer his own account of what the award
represented, the district court held that he had acted arbitrarily and capriciously.
Id. at 670–73. The court therefore ordered MetLife to adjust Roganti’s benefits to
incorporate the award as benefits‐eligible compensation. Id. at 675. It also denied
Roganti’s request for attorney’s fees. Id. at 674–75.
On October 29, 2013, MetLife provided Roganti with a calculation of the
judgment due to him as a result of the district court’s September 2013 opinion. On
November 14, 2013, the district court issued a short opinion rejecting certain
challenges that Roganti had made to this calculation, directing judgment in
Roganti’s favor in the amount of $761,051 (plus interest) for previous benefits
payments that he had not received, and ordering MetLife to incorporate the
arbitration award into Roganti’s 2003–2005 benefits‐eligible compensation for
18
purposes of calculating his benefits going forward. Roganti v. Metro. Life Ins. Co., No.
12 Civ. 161 (PAE), 2013 WL 6043917 (S.D.N.Y. Nov. 14, 2013) (“Roganti III”).
Judgment was entered on November 22, 2013. MetLife filed a timely notice of
appeal, and Roganti timely cross‐appealed from the district court’s denial of his
request for attorney’s fees. We have jurisdiction under 28 U.S.C. § 1291.
DISCUSSION
Our review of a decision following a bench trial on stipulated facts is de novo,
at least where, as here, the district court reached legal conclusions based on its
review of the record and did not hear witness testimony or make credibility
determinations. See Miles v. Principal Life Ins. Co., 720 F.3d 472, 485 (2d Cir. 2013).
ERISA creates a private right of action to enforce the provisions of retirement
plans. See 29 U.S.C. § 1132(a)(1)(B). The Supreme Court has held that plan
administrators’ decisions on benefits eligibility must be evaluated pursuant to
principles of trust law, which “make a deferential standard of review appropriate
when a trustee exercises discretionary powers.” Firestone Tire & Rubber Co. v. Bruch,
489 U.S. 101, 111 (1989); see Restatement (Second) of Trusts § 187 (1959).
Accordingly, where (as in this case) the relevant plan vests its administrator with
discretionary authority over benefits decisions, see supra note 2, the administrator’s
19
decisions may be overturned only if they are arbitrary and capricious. See Pagan v.
NYNEX Pension Plan, 52 F.3d 438, 441 (2d Cir. 1995).7 In this context, arbitrary and
capricious means “without reason, unsupported by substantial evidence or
erroneous as a matter of law.” Id. at 442 (quoting Abnathya v. Hoffman–La Roche, Inc.,
2 F.3d 40, 45 (3d Cir. 1993), abrogated on other grounds by Metro. Life Ins. Co. v. Glenn,
554 U.S. 105 (2008)) (internal quotation marks omitted). This standard is “highly
deferential,” and “the scope of judicial review is narrow.” Celardo v. GNY Auto.
Dealers Health & Welfare Trust, 318 F.3d 142, 146 (2d Cir. 2003).
7
Some authority arguably suggests that an administrator’s interpretation of an
arbitral award is more appropriately reviewed de novo. See Hogan v. Raytheon Co., 302 F.3d
854, 856 (8th Cir. 2002) (holding that de novo review was appropriate where
administrator’s decision turned on interpretation of divorce decree); Dial v. NFL Player
Supplemental Disability Plan, 174 F.3d 606, 611 (5th Cir. 1999) (prescribing de novo review
for plan administrators’ interpretation of a contract and a domestic relations order); see also
Weil v. Ret. Plan Admin. Comm. of Terson Co., 913 F.2d 1045, 1049 (2d Cir. 1990) (applying de
novo review where administrator’s decision turned on a “question of law”), vacated in part
on other grounds on reh’g, 933 F.2d 106 (2d Cir. 1991). Here, we discern no clear reason to
apply de novo review from the text of the Plans, from principles of trust law, or from
ERISA’s purposes. See Conkright v. Frommert, 559 U.S. 506, 512 (2010) (indicating that the
appropriate standard for reviewing an administrator’s benefits determination depends on
these three variables). Regardless, apart from his argument that MetLife operated under
a conflict of interest, see infra pp. 37‐39, Roganti does not dispute that we should review
MetLife’s decision under the arbitrary‐and‐capricious standard. Any such argument is
therefore forfeited. See Presidential Gardens Assocs. v. United States ex rel. Sec’y of Hous. &
Urban Dev., 175 F.3d 132, 141 (2d Cir. 1999).
20
On appeal, MetLife does not contest the district court’s holding that if the
FINRA award represented wages that Roganti would have earned at MetLife but
for the unlawful reduction in his compensation—i.e., if the award represented back
pay—then the award was benefits‐eligible. See Roganti I, 2012 WL 2324476, at *6
(“Although Roganti was no longer employed at the time of the award, if that award
represented back pay to compensate him for services rendered while he was a
MetLife employee, such compensation would properly be included in benefits
calculations.”). Accordingly, the question before us is whether MetLife was
arbitrary and capricious in rejecting Roganti’s contention that the FINRA award did,
in fact, represent back pay.
Roganti argues, and the district court held, that MetLife’s denial of his claim
was arbitrary and capricious because it is sufficiently evident that the FINRA award
represents back pay for the period starting in 2003 and ending upon Roganti’s
retirement in 2005. As noted, Roganti’s theory is that the FINRA panel (1) rejected
his contention that he would not have retired in 2005 had his compensation not
decreased; (2) assumed that, but for the unlawful reduction in his pay, his annual
compensation from 2003 to 2005 would have equaled his 2002 compensation of
$1.506 million; and (3) awarded him the difference between that “but for” amount
21
and his actual earnings from 2003 to 2005, and nothing else. That theory—under
which the award necessarily constitutes back pay—predicts a dollar figure that is
$19.46 higher than the amount of the actual award. The district court faulted
MetLife for rejecting Roganti’s “convincing explanation for the Award” without
offering its own competing explanation of what the award represented. Roganti II,
972 F. Supp. 2d at 672. MetLife argues that this was error, and for the following
reasons, we agree.
A.
An ERISA plan administrator such as MetLife owes a fiduciary duty not just
to the individual participant or beneficiary whose claim is under review, but to all
of the participants and beneficiaries of the plan. See 29 U.S.C. § 1104(a)(1); Morse v.
Stanley, 732 F.2d 1139, 1144–45 (2d Cir. 1984). As a result, “ERISA requires a balance
between ‘the obligation to guard the assets of the trust from improper claims [and]
the obligation to pay legitimate claims.’” Harrison v. Wells Fargo Bank, N.A., 773 F.3d
15, 20 (4th Cir. 2014) (quoting LeFebre v. Westinghouse Elec. Corp., 747 F.2d 197, 207
(4th Cir. 1984)). In striking this balance with respect to a particular claim, a fiduciary
must, among other things, assess whether the claimant has furnished sufficient
evidence that he is entitled to the benefits he seeks.
22
On the one hand, “[p]lan administrators . . . may not arbitrarily refuse to
credit a claimant’s reliable evidence.” Black & Decker Disability Plan v. Nord, 538 U.S.
822, 834 (2003). But it is also true that administrators may exercise their discretion
in determining whether a claimant’s evidence is sufficient to support his claim. For
instance, in cases where the evidence conflicts, an administrator’s conclusion drawn
from that evidence that a claim should be denied will be upheld unless the evidence
points so decidedly in the claimant’s favor that it would be unreasonable to deny the
claim on the basis of the evidence cited by the administrator. Compare Tocker v.
Philip Morris Cos., 470 F.3d 481, 490–91 (2d Cir. 2006) (upholding administrator’s
determination that plaintiff was not a participating employee under the plan where
“ample evidence” suggested that he had been terminated, though there was “also
evidence that [he] was not terminated”), and Hobson v. Metro. Life Ins. Co., 574 F.3d
75, 89–90 (2d Cir. 2009) (rejecting argument that administrator erred in concluding
that the claimant was not disabled based on its weighing of competing medical
evaluations), with McCauley v. First Unum Life Ins. Co., 551 F.3d 126, 138 (2d Cir.
2008) (concluding that administrator’s “reliance on one medical report . . . to the
detriment of a more detailed contrary report without further investigation was
unreasonable”), and Durakovic v. Bldg. Serv. 32 BJ Pension Fund, 609 F.3d 133, 140 (2d
23
Cir. 2010) (holding that funds’ reasoning was inappropriately “one‐sided” where
funds “summarily dismissed” a report by the claimant’s vocational expert, “which
was vastly more detailed and particularized than the report on which the Funds
relied”). Put differently, if the administrator has cited “substantial evidence” in
support of its conclusion, the mere fact of conflicting evidence does not render the
administrator’s conclusion arbitrary and capricious. See Durakovic, 609 F.3d at 141
(defining “substantial evidence” as “such evidence that a reasonable mind might
accept as adequate to support the conclusion reached by the administrator” (quoting
Celardo, 318 F.3d at 146)).
In other cases, the record evidence may not conflict—the only available
evidence may, in fact, point in the claimant’s favor—but it may nonetheless be
permissible for the plan administrator to conclude that the evidence is insufficient
to support the claim. See Juliano v. Health Maint. Org., 221 F.3d 279, 287–88 (2d Cir.
2000) (explaining that an ERISA claimant bears the burden of establishing his
entitlement to benefits).8 For instance, in Jiras v. Pension Plan of Make‐Up Artist &
8
The nature of a claimant’s burden may depend in part on the specific terms of
the plan at issue. See Gaither v. Aetna Life Ins. Co., 394 F.3d 792, 804 (10th Cir. 2004); see
also Hobson, 574 F.3d at 88 (holding that plan administrator could appropriately require
objective medical evidence supporting disability claim where “[s]uch a requirement is
not contradicted by any provision of [the administrator’s] own policy”). In this case, the
24
Hairstylists Local 798, the plaintiff’s claim for pension benefits turned on whether he
had worked in 1964 or 1965 for a union employer that contributed to the fund. 170
F.3d 162, 163–64 (2d Cir. 1999). We held that it was not arbitrary and capricious for
the plan administrator to deny the plaintiff’s claim, given that the only evidence of
his union employment over that period was an unsubstantiated affidavit from an
unreliable witness. See id. at 166.
Under certain circumstances, it may be arbitrary and capricious for the
administrator to reject a claimant’s evidence as inadequate without making a
reasonable effort to develop the record further. See Gaither v. Aetna Life Ins. Co., 394
F.3d 792, 808 (10th Cir. 2004) (“An ERISA fiduciary presented with a claim that a
little more evidence may prove valid should seek to get to the truth of the matter.”);
Miller v. United Welfare Fund, 72 F.3d 1066, 1073 (2d Cir. 1995) (faulting fund for not
seeking evidence to confirm whether its “speculation” as to plaintiff’s need for a
private nurse was correct). Ultimately, however, “[t]he rule is one of reason,” and
“[n]othing . . . requires plan administrators to scour the countryside in search of
evidence to bolster a petitioner’s case.” Harrison, 773 F.3d at 22; see also O’Reilly v.
parties have not called our attention to any provision in the Plans that might affect
Roganti’s evidentiary burden, so we will confine our discussion to “the minimum
standards of ERISA.” Gaither, 394 F.3d at 804.
25
Hartford Life & Accident Ins. Co., 272 F.3d 955, 961 (7th Cir. 2001) (explaining that
ERISA requires a “reasonable inquiry,” not a “full‐blown investigation” (internal
quotation marks omitted)). Thus, a claimant’s evidence may simply be insufficient
to establish his entitlement to benefits, even in the absence of evidence tending to
refute his theory of entitlement. See, e.g., Jiras, 170 F.3d at 166.
B.
In this case, it is undisputed that Roganti offered no direct evidence that the
FINRA award represents back pay, and that the time for seeking clarification of the
award from the arbitral panel was allowed to pass. Accordingly, the question is
whether it was arbitrary and capricious for MetLife to determine that Roganti failed
to establish his entitlement to additional pension benefits based (as Roganti’s claim
was) solely on inferences that Roganti urged should be drawn from the materials
that MetLife reviewed in assessing his claim. In light of the principles described
above, we conclude that MetLife’s determination was not arbitrary and capricious.
With his initial claim to MetLife, Roganti submitted only the award itself, a
news article describing the award, the statement of claim that he had submitted in
the FINRA arbitration, and proof that MetLife had, in fact, paid him $2,492,442.07.
Based on these materials alone, it was not arbitrary and capricious for MetLife
26
initially to reject Roganti’s claim on the ground that the award did not “clearly fall
within the definition” of benefits‐eligible compensation under the Plans. J.A. 831.
As Dudas explained in her letter denying Roganti’s claim, and as Bernstein likewise
emphasized in adhering to Dudas’s determination on appeal, the award
itself—consistent with Roganti’s statement of claim—indicated that Roganti had
asked for “unspecified compensatory damages” in addition to punitive damages,
an accounting of R. Roganti & Associates’ revenues and expenses, back pay, front
pay, and reimbursement for lost benefits, plus fees, expenses, and interest. J.A. 803.
The award specifically stated both that it represented “compensatory damages” and
that “[a]ny and all relief not specifically addressed herein” was denied. J.A. 804.
The award itself therefore undermined Roganti’s argument that it was back pay,
which both Roganti and the panel apparently viewed as a separate damages
category that was not specifically awarded and thus denied.
As the district court recognized, it arguably begs the question somewhat to
conclude that the award was not benefits‐eligible simply because it was labeled
“compensatory damages.” If it were clear, for example, that the award were
“compensating” Roganti only for wages he should have earned while still employed
at MetLife, then the award might appropriately be considered benefits‐eligible back
27
pay in substance, regardless of what the FINRA panel labeled it. Judging only by
the materials Roganti initially submitted to MetLife, however, the award easily
could have been intended to “compensate” Roganti not only for his reduced pre‐
retirement wages, but also for wages that he would have earned had he not retired
in 2005 and/or for the reduction in pension benefits traceable to his deflated
pay—each of which was a category of relief requested in Roganti’s statement of
claim. Accordingly, even assuming that some of the FINRA award might have
constituted back pay, it was impossible to tell how much based only on the
materials Roganti submitted. It was reasonable for MetLife to determine that
Roganti was not entitled to any increase in benefits at all in light of the dearth of
probative evidence regarding the extent to which his benefits‐eligible compensation
might have increased.
Of course, MetLife was later presented with the entire arbitral record
following remand from the district court.9 As noted, Bernstein reviewed this record
9
We express no view on whether it was appropriate for the district court to
remand to MetLife with instructions to review the arbitral record, given that Roganti
had not initially submitted the record with his claim. As noted, it may sometimes be
unlawful for a plan administrator to deny a claim while ignoring evidence that the
claimant failed to submit but which the administrator could readily obtain. E.g.,
Harrison, 773 F.3d at 22–23. MetLife was a party to the FINRA arbitration, but it is not
entirely clear whether the arbitral record was readily available to Dudas and Bernstein.
Because the district court’s decision to remand following MetLife’s motion to dismiss is
28
and still found it impossible to determine the extent, if any, to which the award
represented back pay. In particular, Bernstein opined that the extensive discussion
during the arbitration of how Roganti’s pension benefits were calculated, combined
with the fact that Roganti had asked the panel to award him damages for the
decrease in his pension, suggested that “any additional pension benefits Roganti
sought during the arbitration were already included in and made part of” the
award. J.A. 927. Bernstein also highlighted the fact that the award was not divided
among multiple earnings years, notwithstanding the FINRA panel’s evident
understanding that calculating Roganti’s pension required determining his benefits‐
eligible compensation on a yearly basis. The panel’s failure to divide the award
among multiple years implied that the award already included Roganti’s decreased
pension benefits because it suggested that the FINRA panel was not leaving it to
MetLife itself to adjust Roganti’s pension.10
not before us, we need not explore this issue further. We observe, however, that the
district court (incorrectly) framed its inquiry on MetLife’s motion to dismiss as
“whether the arbitral award represented back pay,” Roganti I, 2012 WL 2324476, at
*7—not whether MetLife’s denial of Roganti’s claim was arbitrary and capricious,
which is a distinct question.
10
Roganti suggests that the FINRA panel did not have the authority to award
pension benefits because the Plans were not parties to the arbitration. This argument is
unavailing. An ERISA plan participant or beneficiary need not sue the plan itself to
recover benefits, but may sue the administrator instead, see, e.g., Chapman v. ChoiceCare
29
The district court faulted Bernstein’s analysis as a “naysaying submission”
that failed to provide “a rational accounting for the Award as issued.” Roganti II,
972 F. Supp. 2d at 671, 672. In contrast, it found Roganti’s argument as to what the
panel had done to be “coherent and logical.” Id. at 670. For the following reasons,
however, we disagree with the district court’s characterization, and with its
conclusion that Bernstein’s explanation of the denial of Roganti’s claim constituted
an abuse of discretion.
First, Roganti’s contention that the award exclusively represents back pay
requires the assumption that the arbitral panel did not include increased pension
benefits in the award, even though Roganti (sometimes) specifically asked it to do
so. As Bernstein explained, however, the panel heard extensive testimony about
how Roganti’s pension was calculated. It is true that Roganti’s counsel, in
summation, presented the panel with the option of simply awarding Roganti back
pay and leaving the benefits calculation up to MetLife. But had the panel taken that
route (and there is nothing in the arbitral transcript to suggest that it did), one
Long Island Term Disability Plan, 288 F.3d 506, 510 (2d Cir. 2002)—which in this case was
MetLife, a party to the arbitration. It is also clear from the arbitral record that no one
(including Roganti, who specifically sought increased pension benefits from the panel)
disputed the arbitrators’ authority to award such relief.
30
would reasonably expect the award to have made the panel’s intentions clear to
MetLife by using explicit language, breaking the award out on a year‐by‐year basis,
or both. The district court’s indication that “the Award’s inexactitude” was an
impermissible basis for denying Roganti’s claim because that inexactitude was what
“prompt[ed] these proceedings,” id. at 672, was misplaced. As Bernstein explained,
the award’s opacity was not merely a source of uncertainty; the omission of
particulars that would have been necessary to implement Roganti’s version of the
award’s meaning constituted evidence against Roganti’s claim.
Although Bernstein did not advance his own mathematical breakdown of the
award, he was not required to do so in order to deny Roganti’s claim. The district
court faulted Bernstein for “pass[ing] on the Court’s request that [he] posit, based
on the record, a concrete alternative explanation to Roganti’s for the Award.” Id. at
671. Initially, however, we have doubts as to whether the district court clearly
communicated this request. Its opinion determining that remand was necessary
stated that MetLife should review the record “to permit a determination to be made,
in the context of the evidence offered and arguments made by both sides at the
arbitration, whether or not the award represented back pay.” Roganti I, 2012 WL
2324476, at *8. The court suggested that MetLife might then be able to “posit an
31
alternative explanation” for the award, id., but it did not say that doing so was the
only way for MetLife permissibly to determine that Roganti had failed to establish
his entitlement to benefits. Similarly, the remand order merely instructed MetLife
to “conduct a close review” of the district court’s decision and the arbitral record “to
determine whether or not . . . the arbitrator’s award . . . constituted benefits eligible
compensation,” and to explain its conclusion “with clarity and in detail.” Special
App’x 18.
Regardless, while we appreciate the able district judge’s impulse to get to the
bottom of what the award represented, we must measure Bernstein’s explanation
against the arbitrary‐and‐capricious standard, not against any and all obligations
imposed by the district court. The district court relied on cases indicating that a
plan administrator acts arbitrarily and capriciously when it denies a claim on the
basis of evidence that is significantly weaker than the evidence supporting the claim.
See Roganti II, 972 F. Supp. 2d at 671 (citing McCauley, 551 F.3d at 138, and Durakovic,
609 F.3d at 140). But we think this analogy is inapt. If Roganti’s evidence taken
alone was inadequate to support his claim (which MetLife rationally found that it
was), then MetLife could appropriately deny his claim regardless of the strength of
the evidence pointing the other way. See Jiras, 170 F.3d at 166.
32
For similar reasons, we place little significance on Bernstein’s failure
specifically to refute Roganti’s explanation for the award. Again, it is unclear from
the record whether Bernstein was even aware of that explanation. The district
court’s first opinion mentioned that Roganti had a theory but did not say what it
was. See Roganti I, 2012 WL 2324476, at *8. In reviewing Bernstein’s decision, the
district court indicated that Roganti had “first articulated” his theory “during the
motion to dismiss litigation,” Roganti II, 972 F. Supp. 2d at 671, but as noted, the
remand order instructed Bernstein only to look at the district court’s decision and
the arbitral record, and not at briefing or oral argument transcripts.
In any event, Roganti’s theory is undermined by the very facts that Bernstein
identified. Roganti’s theory depends on the assumption that the arbitrators
awarded him the difference between $1.506 million annually and his actual earnings
from 2003 to 2005, and then intended for MetLife to calculate his pension. But
despite the fact that Roganti’s counsel specifically suggested that the arbitrators
direct MetLife to recalculate the pension, the award does not manifest any such
intention. The silence is significant. The arbitrators’ authority to craft a remedy was
not limited to Roganti’s proposed damages calculations, and Roganti’s counsel
acknowledged that the arbitrators were capable of reducing pension adjustments
33
to a lump sum themselves. As one arbitrator observed, “I have a calculator, I could
do it.” J.A. 2291. As a result, the arbitrators could have arrived at a back pay figure
for 2003 to 2005 that was lower than what Roganti requested and added their own
pension adjustment in lump‐sum form.
We also find the $19.46 discrepancy between the actual award and Roganti’s
calculation more notable than the district court did. The appeal of Roganti’s theory
lies solely in its power to account for the very precise amount of the panel’s award.
But that power is undermined if the theory does not, in fact, predict the exact
amount of the award. The district court attributed this discrepancy to the necessity
for “some degree of arithmetic extrapolation” to account for “the 2005 stub year,”
id. at 672 n.8—to the fact that Bernstein resigned in the first quarter of 2005—but
neither the court nor Roganti explained how the panel might have arrived at a
number that was off by just $19.46. Given these shortcomings, we cannot say that
MetLife was required to accept Roganti’s theory as adequate proof of his entitlement
to increased benefits.
Finally, it warrants emphasis that Roganti failed to obtain clarification of the
award from the FINRA panel within the time limit prescribed for doing so. Once
that opportunity was no longer available, it effectively became impossible for
34
anyone—Roganti, MetLife, or the courts—to determine definitively what the award
was compensation for. Permitting Roganti to recover under these circumstances,
despite the uncertainty that he could have helped to prevent, would provide poor
incentives for future claimants in his position. Only a claimant, and not his plan
administrator, will know after he receives an arbitral award whether he will claim
benefits on the ground that the award increases his benefits‐eligible compensation.
And the plan administrator, of course, will have no reason to seek clarification of the
award until a claim is actually made. If the claim is made after the deadline for
seeking such clarification has passed, the administrator will be powerless to shed
light on what the award represents, except by recourse to the kind of unsatisfactory
hypothesizing that the district court prescribed here. From this perspective, the
better course is to place the burden on the claimant to ensure that the basis for his
claim is as clear as possible before it is made, and to seek clarity during the
arbitration or timely afterward.
The district court recognized the peculiarity of forcing a plan administrator
to comb through thousands of pages of arbitration testimony in order to reverse‐
engineer an explanation for an arbitral award. In the district court’s view, this was
a reason to grant less deference to MetLife’s determination on remand. See Roganti
35
II, 972 F. Supp. 2d at 673–74. But that conclusion does not follow. Where an
administrator has discretionary powers, courts reviewing its decisions are assessing
the reasonableness of those decisions, and not “considering the issue of eligibility
anew.” Pagan, 52 F.3d at 442. Among other goals, “[d]eference promotes efficiency
by encouraging resolution of benefits disputes through internal administrative
proceedings rather than costly litigation.” Conkright v. Frommert, 559 U.S. 506, 517
(2010). Accordingly, a plan administrator’s decision is intended to be final—within
the bounds of the highly deferential arbitrary‐and‐capricious standard—and not
merely an input with “the potential to assist the Court” in making the ultimate
determination.11 Roganti II, 972 F. Supp. 2d at 673. If MetLife could not reasonably
be expected to have the institutional capacity required to reconstruct the arbitrators’
intentions on remand, then its failure to perform that task to the district court’s
satisfaction was not a sound basis for overturning its decision.
11
It is for this same reason that we held, in Miller v. United Welfare Fund, that “a
district court’s review under the arbitrary and capricious standard is limited to the
administrative record.” 72 F.3d at 1071. As we explained in that case, this rule is
consistent with the absence of evidence that Congress “‘intended that federal district
courts would function as substitute plan administrators’ and with the ERISA ‘goal of
prompt resolution of claims by the fiduciary.’” Id. (quoting Perry v. Simplicity Eng’g, 900
F.2d 963, 966 (6th Cir. 1990)).
36
C.
Roganti’s argument that MetLife was operating under a conflict of interest
does not affect our analysis. In Metropolitan Life Insurance Co. v. Glenn, the Supreme
Court held that when a claimant demonstrates that an ERISA plan administrator
with discretionary authority is subject to a conflict of interest, courts should not
apply a more exacting standard of review, but should instead weigh the conflict “as
a factor in determining whether there is an abuse of discretion.” 554 U.S. at 115
(quoting Firestone, 489 U.S. at 115) (internal quotation marks omitted). Once a
conflict of interest is identified, determining the weight that it should receive
relative to other relevant factors requires a totality‐of‐the‐circumstances approach:
[A]ny one factor will act as a tiebreaker when the other factors are
closely balanced, the degree of closeness necessary depending upon the
tiebreaking factor’s inherent or case‐specific importance. The conflict
of interest at issue . . . should prove more important (perhaps of great
importance) where circumstances suggest a higher likelihood that it
affected the benefits decision, including, but not limited to, cases where
an insurance company administrator has a history of biased claims
administration. It should prove less important (perhaps to the
vanishing point) where the administrator has taken active steps to
reduce potential bias and to promote accuracy, for example, by walling
off claims administrators from those interested in firm finances, or by
imposing management checks that penalize inaccurate decisionmaking
irrespective of whom the inaccuracy benefits.
37
Id. at 117 (citation omitted); see also, e.g., Durakovic, 609 F.3d at 138–41; Hobson, 574
F.3d at 82–83; McCauley, 551 F.3d at 131–33.
In this case, it is undisputed that MetLife has a “categorical” conflict of
interest because it both evaluates and pays claims. Durakovic, 609 F.3d at 138. We
conclude, however, that this conflict should receive no weight in our assessment of
whether MetLife’s denial of Roganti’s claim was arbitrary and capricious. In the
district court, MetLife submitted an unrebutted affidavit from Bernstein, who
averred, among other things, that MetLife’s business and finance departments “are
kept completely separate from the administration of the Plans,” that he “did not
consult or consider MetLife’s or the Plans’ finances in connection with [his]
determinations” in this case or discuss Roganti’s claim with the business or finance
departments, and that his compensation is not tied to whether he upholds or denies
benefits claims. J.A. 2905–06. These are the kinds of “active steps” that, the
Supreme Court suggested in Glenn, may reduce a conflict’s importance “to the
vanishing point.” 554 U.S. at 117. Nor has Roganti established that MetLife has a
history of biased claims administration or provided any other reason to assign
weight to MetLife’s conflict.
38
Moreover, we have in the past declined to assign any weight to a conflict of
interest “in the absence of any evidence that the conflict actually affected the
administrator’s decision.” Durakovic, 609 F.3d at 140; see Hobson, 574 F.3d at 82–83.
Roganti has identified no such evidence here. It is true that a smoking gun is not
always required; under certain circumstances, an irrational decision or a one‐sided
decisionmaking process can alone constitute sufficient evidence that the
administrator’s conflict of interest actually affected the challenged decision. See, e.g.,
Durakovic, 609 F.3d at 140 (assigning weight to a conflict because of the
“decisionmaking deficiencies” evident in the defendants’ denial of the plaintiff’s
claim); McCauley, 551 F.3d at 136 (inferring that a conflict had affected the
defendant’s decisionmaking because nothing else explained its failure to allow the
plaintiff to cure certain defects in his claim). But as discussed above, we think that
MetLife’s rationale for denying Roganti’s claim—i.e., that it was impossible to
determine whether, or the extent to which, the FINRA award represented back
pay—was not, in fact, unreasonable.12
12
Roganti also suggests that decreased deference is appropriate because MetLife
denied his claim three times, not just once. He cites Conkright v. Frommert, in which the
Supreme Court held that arbitrary‐and‐capricious review does not become de novo
even when a Court of Appeals has already determined that the plan administrator’s
claim denial was erroneous and reviews the administrator’s decision again following
39
Because we conclude that MetLife’s denial of Roganti’s benefits claim was not
arbitrary and capricious, we do not reach MetLife’s alternative argument that the
district court erred in refusing to dismiss this action on the basis of res judicata or
collateral estoppel. Additionally, in light of our conclusion that the district court’s
judgment must be reversed, we reject Roganti’s cross‐appeal from the district court’s
refusal to award him attorney’s fees under ERISA’s fee‐shifting provision, 29 U.S.C.
§ 1132(g)(1). Assuming (purely arguendo) that a party who wins at trial but loses
on appeal is eligible for a fee award under § 1132(g)(1) by virtue of achieving “some
degree of success on the merits,” Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242,
245 (2010) (quoting Ruckelshaus v. Sierra Club, 463 U.S. 680, 694 (1983)) (internal
quotation marks omitted), we detect no abuse of discretion in the district court’s
conclusion, after weighing the relevant factors, see Donachie v. Liberty Life Assurance
Co., 745 F.3d 41, 46–47 (2d Cir. 2014), that Roganti was not entitled to such an award
in this case.
remand. 559 U.S. at 513. Conkright would not support Roganti’s position even if we
had previously found MetLife’s decision erroneous. In any event, the correctness of
MetLife’s decision is the very question before us in this appeal. It would make no sense
to afford that decision decreased deference simply because the district court held, in the
order under review, that MetLife’s decision was erroneous.
40
CONCLUSION
We have considered Roganti’s remaining arguments and find them to be
without merit. For the reasons set forth above, the portion of the district court’s
judgment granting Roganti relief under ERISA is REVERSED, and the portion of
that judgment denying Roganti’s request for attorney’s fees is AFFIRMED.
41