In the
 United States Court of Appeals
              For the Seventh Circuit
                        ____________

Nos. 04-3408 & 04-3415

JAMES HESS & JOHN HESS,
                                         Plaintiffs-Appellants,
                               v.

REG-ELLEN MACHINE TOOL CORP.
and REG ELLEN MACHINE TOOL CORP.
EMPLOYEE STOCK OWNERSHIP PLAN,
                                        Defendants-Appellees.
                        ____________
          Appeals from the United States District Court
      for the Northern District of Illinois, Western Division.
   Nos. 00 C 50275 & 02 C 50007—Philip G. Reinhard, Judge.
                        ____________
   ARGUED MAY 6, 2005—DECIDED SEPTEMBER 6, 2005
                    ____________



 Before KANNE, ROVNER, and WOOD, Circuit Judges.
  ROVNER, Circuit Judge. Reg-Ellen Machine Tool Corpora-
tion (“Reg-Ellen”) administers an Employee Stock Owner-
ship Plan (“ESOP”) for its employees that is governed by
the Employee Retirement and Income Security Act of 1974
(“ERISA”), 29 U.S.C. §§ 1001 et seq. Plan participants John
and James Hess, brothers and former employees of Reg-
Ellen, each brought suit in federal district court against
Reg-Ellen and the Reg-Ellen ESOP, claiming that the plan
administrator had wrongfully denied their requests to move
2                                  Nos. 04-3408 & 04-3415

their retirement funds from Reg-Ellen stock into diversified
investments. See 29 U.S.C. § 1132(a)(1)(B) (authorizing
suits by participants in plans covered by ERISA to enforce
rights under terms of plan). John Hess also sued to enforce
his alleged right under the Illinois Business Corporation
Act to inspect Reg-Ellen’s books and records. See 805 ILCS
5/7.75 (requiring corporations to allow shareholders to
examine corporate books and records for a proper purpose).
On the parties’ cross motions for summary judgment, the
district court granted summary judgment to the defendants,
and the Hesses appeal. For the reasons stated below, we
affirm.


                             I.
  John Hess began working at Reg-Ellen in 1987, and
James Hess followed suit two years later in 1989. Both
resigned in 1996, when they were either 51 or 52 years old
(we assume from the fact that the Hesses have the same
birth date that they are twins). At the time they resigned,
the Hesses had pension benefits in Reg-Ellen’s ESOP.
ESOP’s are “a type of pension plan intended to encourage
employers to make their employees stockholders.” Steinman
v. Hicks, 

, 1102 (7th Cir. 2003); see also 29
U.S.C. § 1107(d)(6); Summers v. State St. Bank and Trust
Co., 

, 106 (7th Cir. 1997). As we explained in
Steinman, in the typical ESOP, the employer contributes
the stock to the retirement plan on behalf of its employees.

. In Reg-Ellen’s case, however,
before 1994 employees were also allowed to contribute on
their own behalf by withholding money from their pay-
check—in plan terms, “salary reduction contributions.”
  In addition to Reg-Ellen stock, the ESOP allowed partici-
pants to channel salary reduction contributions into what
the plan calls the “Other Investments Account,” comprised
of more diversified investments. Before 1994, Reg-Ellen also
Nos. 04-3408 & 04-3415                                       3

made contributions on behalf of plan participants to either
the Reg-Ellen stock fund or the other investments account.
The plan explains that plan participants had the right to
“direct the Trustee to invest [their] contributions” or
contributions made by Reg-Ellen on their behalf “in either
(i) an Employer Stock Fund or (ii) the Other Investments
Account.” Reg-Ellen ESOP § 4.12(a). The plan further
specifies that the trustee will invest assets in the stock fund
primarily in Reg-Ellen stock and assets in the “Other
Investments Account” in diversified securities and property
(not including Reg-Ellen stock). Reg-Ellen ESOP
§ 4.12(b),(c).
  In 1995, Reg-Ellen’s Board of Directors amended the
ESOP to eliminate employees’ salary reduction contribu-
tions and the lion’s share of Reg-Ellen’s contributions to the
ESOP. Previously Reg-Ellen had matched the total amount
of all salary reduction contributions via what the plan calls
the “Employer’s Elective Contribution” and had also
contributed a discretionary matching amount for certain
eligible employees. Reg-Ellen ESOP § 4.1(a),(b). These
contributions, together with participants’ salary reduction
contributions, were eliminated as of December 1, 1994, the
retroactive effective date of the amendments. Reg-Ellen
ESOP Amended § 4.1(a),(b). Thus, the only money going
into the ESOP after December 1994 was in the form of a
“discretionary amount” contributed by Reg-Ellen. Reg-Ellen
ESOP § 4.1(c).
  The board amended the Plan in this way in preparation
for an upcoming change in ownership at Reg-Ellen. Specifi-
cally, in 1997 David Lewellen, who had been the president
of Reg-Ellen and principal shareholder since 1978, sold his
majority ownership interest to the ESOP. This sale coin-
cided with Lewellen’s retirement. Thus, in January 1998,
Timothy Turner succeeded Lewellen as president of Reg-
Ellen, and Lewellen’s former assistant, Lorraine Morris,
became secretary of Reg-Ellen.
4                                   Nos. 04-3408 & 04-3415

  Around this same time, John and James (who had left in
1996) began inquiring about their options under the
pension plan. They wrote identical letters to Turner and
Plan Trustee Richard Bennett, requesting a distribution of
their “ESOP money to roll over into an IRA account of
[their] choice.” Craig Thomas, the attorney for the Reg-
Ellen ESOP, replied to the Hesses’ letters. He informed
them that they would not be eligible for a distribution until
they were 55 years old and enclosed a copy of the plan for
their reference. The Hesses continued requesting a distribu-
tion over the next several months, but Reg-Ellen steadfastly
maintained that they were not yet qualified.
  In June 1998, John again wrote Bennett (the ESOP
trustee), this time requesting to diversify his Reg-Ellen
stock from the stock fund to the Other Investments Ac-
count. At some point James Hess made a similar request. In
support of their request, the Hesses relied on amendment
4.12(i), which had been added to the plan with the 1995
amendments eliminating employees’ salary reduction
contributions. Although Bennett thought the amendment
supported the Hesses’ attempts to diversify their Reg-Ellen
stock, Turner and Thomas (the plan’s attorney) disagreed.
Both maintained that the Hesses must first satisfy the
diversification requirements located elsewhere in the plan,
which included attaining 55 years of age.
  The Hesses thus requested a hearing on their claim to
diversify their contributions to Reg-Ellen stock. Although
they had been represented by counsel while corresponding
with Reg-Ellen, a different attorney represented them at
the appeal hearing before Reg-Ellen’s administrative
committee. The committee was comprised of plan adminis-
trator and company president Turner, Morris, and four
other corporate officers of Reg-Ellen. On September 30,
1999, the committee held a hearing on the Hesses’ claim,
which was framed as follows: “Whether [John and James
are] entitled to diversify [their] pre-December, 1994 contri-
Nos. 04-3408 & 04-3415                                       5

butions into the Plan which are currently invested in Reg-
Ellen Machine Tool Corp. stock.” Although not relevant
here, James Hess also appealed his claim to a distribution
on account of an alleged disability. With the exception of a
medical report relating to the disability claim, the Hesses
presented no evidence at their hearing other than the plan
document itself.
  Just over a month later, the administrative committee
denied the Hesses’ claims, reasoning that they were not
entitled to diversify their stock because they were not yet 55
years old. See Reg-Ellen ESOP § 4.12(g) (enumerating
diversification requirements). Although the Hesses did not
refer to it, the committee also considered section 4.12(i), the
amendment that the Hesses’ previous counsel had relied on
to support their diversification claim. The committee
concluded, however, that the amendment was intended to
allow those participants who had contributed salary
reduction contributions into the Other Investments Account
to direct the investment of their pre-amendment contribu-
tions within that account. Thus, reasoned the committee,
section 4.12(i) did not advance the Hesses’ claim to diversify
their Reg-Ellen stock.
  John and James then each filed suit against Reg-Ellen
and the Reg-Ellen ESOP (together “Reg-Ellen”) under
section 502(a)(1)(B) of ERISA, 29 U.S.C. § 1132(a)(1)(B),
which allows a participant in a plan governed by ERISA to
bring a civil action to “recover benefits due to him under the
terms of his plan, to enforce his rights under the terms of
the plan, or to clarify his rights to future benefits under the
terms of the plan.” Each alleged that a decrease in the
value of Reg-Ellen stock between 1997 and 2001 had caused
him to lose money. In particular, the complaints alleged
that John saw the value of his 48,564 shares decrease by
more than $111,000, and James saw the value of his 9,702
shares drop by more than $50,000 (parenthetically, we note
that we find these allegations puzzling, since James owned
6                                   Nos. 04-3408 & 04-3415

approximately 1/5 as many shares as John, yet is alleged to
have lost nearly half as much money). John’s complaint also
included a state-law claim under the Illinois Business
Corporation Act alleging that Reg-Ellen wrongfully denied
him the opportunity to inspect its corporate books and
records. See 805 ILCS 5/7.75. The district court consolidated
the Hesses’ suits for decision, and both the Hesses and Reg-
Ellen moved for summary judgment. The district court
granted Reg-Ellen’s motion, concluding that the committee’s
denial of the Hesses’ request to diversify was not arbitrary
or capricious and that John’s state-law claim failed because
he was not a “shareholder” as that term is defined in the
Illinois Business Corporation Act.


                             II.
                             A.
  We review a district court’s decision on cross-motions for
summary judgment de novo. Tegtmeier v. Midwest Operat-
ing Eng’rs Pension Trust Fund, 

, 1045 (7th
Cir. 2004). Summary judgment is proper when there is no
genuine issue of material fact and the moving party is
entitled to judgment as a matter of law. Fed. R. Civ. P.
56(c); Anderson v. Liberty Lobby Inc., 

, 255
(1986). “With cross-motions, our review of the record
requires that we construe all inferences in favor of the party
against whom the motion under consideration is made.”

(citation and internal quota-
tions omitted). In ERISA cases the scope of the district
court’s and likewise our review is governed by the rule that
a denial of benefits is reviewed de novo unless the plan
gives the plan administrator discretion to construe policy
terms. See Ruttenberg v. U.S. Life Ins. Co., 

,
659 (7th Cir. 2005). Here the parties agree that Reg-Ellen’s
plan gives the plan administrator discretion to interpret the
plan, Reg-Ellen ESOP § 2.6 (“The Administrator . . . shall
Nos. 04-3408 & 04-3415                                       7

have the power and discretion to construe the terms of the
Plan and to determine all questions arising in connection
with the administration, interpretation, and application of
the Plan.”). Thus we review the administrator’s decision
under the deferential arbitrary and capricious standard. See
Firestone Tire and Rubber Co. v. Bruch, 

, 115
(1989); 

. Under this “least
demanding form of judicial review,” Olander v. Bucyrus-Erie
Co., 

, 607 (7th Cir. 1999), we will not set aside
a denial of benefits based on any reasonable interpretation
of the plan, Mers v. Marriott Int’l Group Accidental Death
and Dismemberment Plan, 

, 1021 (7th Cir.
1998). Indeed, whether or not we would have reached the
same conclusion is irrelevant; we will overturn the fidu-
ciary’s denial of benefits only if it is “completely unreason-
able.” Ruiz v. Cont’l Cas. Co., 

, 991 (7th Cir.
2005) (citation and internal quotations omitted); see also

; 

.
  Although acknowledging the grant of discretionary
authority in Reg-Ellen’s ESOP, the Hesses suggest our
review should be more searching because the committee
that approved the denial of their claims was biased.
Specifically, they claim that the Reg-Ellen officers and
directors who administer the ESOP have an inherent
conflict of interest because any decision to award benefits
will adversely affect Reg-Ellen’s bottom line. Although the
Supreme Court in Firestone recognized that a fiduciary’s
conflict of interest should weigh as a “factor” in our analysis
of the fiduciary’s decision, 

at 115, we have
repeatedly rejected arguments for a heightened standard of
review solely because a corporation or insurer interprets its
own plan to deny benefits. See Perlman v. Swiss Bank Corp.
Comprehensive Disability Prot. Plan, 

, 981 (7th
Cir. 1999); Chojnacki v. Georgia-Pac. Corp., 

,
815 (7th Cir. 1997); Chalmers v. Quaker Oats Co., 

, 1344 (7th Cir. 1995). In Chalmers we pointed out that
8                                   Nos. 04-3408 & 04-3415

ERISA endorses the “notion of a corporate officer who
doubles as a plan 

, and
would establish procedures for limiting or prohibiting the
practice if it were a cause for concern, id.; see also

(accord). Moreover, we have
recognized that companies have an incentive not to deny
meritorious claims because such behavior would negatively
impact their reputation and leave employees unsatisfied
with their fringe benefits. See 

;

.
  The Hesses, however, suggest that the bias against their
claims is more significant here because Reg-Ellen lacked
sufficient assets to grant their requests for diversification.
Because Reg-Ellen is not a publicly traded company, it must
buy participants’ shares of stock from the ESOP in order to
pay out claims from the stock fund. According to the Hesses,
both Turner and Morris admitted that Reg-Ellen would
have been unable to buy back the shares to pay the Hesses’
claims. The deposition testimony the Hesses rely on,
however, does not go that far. When asked if Reg-Ellen had
“in excess of $250,000 cash” available to buy the Hesses’
stock, Turner said that it did. He conceded however, that
paying out that amount would “change the whole forecast-
ing going forward” as far as what the ESOP could do with
the other plan participants. And Morris testified that she
did not remember how much Reg-Ellen had available in
liquid assets in 1998 when the Hesses made their claims
and that she was unsure how awarding their claims would
affect company assets.
  Given these acknowledgments, the Hesses’ claim of bias
has more teeth to it than similar claims that we have
rejected in the past. This is because in those cases in which
we have rejected plaintiffs’ claims of bias, we have done so
in part because a decision to award benefits in those cases
would have had a minor impact on the companies’ financial
well-being. See 

(“When the
Nos. 04-3408 & 04-3415                                       9

administrator is a large corporation, the firm has a finan-
cial interest, but the award in any one case will have only
a trivial effect on its operating results.”); 

(noting that defendant had “consistently been
named as one of the fifty largest companies in the ‘Fortune
500’ listing” and that the “impact of granting or denying
benefits . . . [was] minuscule compared to [defendant’s]
bottom line”); 

(“[The defendant]
is a corporation which generates revenues of nearly $6
billion annually and is therefore not likely to flinch at
paying out $240,000.”).
  However, contrary to the Hesses’ suggestion, the possibil-
ity that the committee was operating under a conflict of
interest does not change the arbitrary and capricious
standard of review. Citing two cases from the Eleventh
Circuit, the Hesses maintain that the possibility of bias
shifts the burden to the fiduciary to prove that self-interest
played no part in his decision. See Levinson v. Reliance
Standard Life Ins. Co., 

, 1326 (11th Cir.
2001); Adams v. Thiokol Corp., 

, 842 (11th Cir.
2001). To the contrary, we have consistently held that the
“presence of a conflict of interest does not change the
standard of review.” O’Reilly v. Hartford Life & Accident
Ins. Co., 

, 960 (7th Cir. 2001) (citing 

); see also 

;
Chojnacki, 

. Moreover, unlike the Eleventh
Circuit, we have concluded that the existence of a potential
conflict is not enough. 

. Instead, we
require the plan participant to offer “specific evidence of
actual bias that there is a significant conflict.” 

at 1020. We question whether the Hesses’ assertion that
Reg-Ellen “may not have had the funds available” satisfies
this standard. And our reluctance to disturb the presump-
tion that the fiduciary is acting neutrally, 

helped
by the Hesses’ failure to provide us with any concrete
figures to support their theory.
10                                   Nos. 04-3408 & 04-3415

  That said, Turner’s admission that granting the Hesses’
claims would impact Reg-Ellen’s operating results gives us
pause. Given the evidence that the committee’s decision to
deny the Hesses’ claims may have been animated by
concerns for Reg-Ellen’s finances, we may perform a slightly
“more penetrating” review. Manny v. Central States,
Southeast & Southwest Areas Pension & Health and Welfare
Funds, 

, 242-43 (7th Cir. 2004) (quoting Van
Boxel v. Journal Co. Employees’ Pension Trust, 

, 1052-53 (7th Cir. 1998) for proposition that arbitrary
and capricious standard in ERISA cases is a “sliding scale”
that moves in relationship to the degree of suspicion of
partiality). Thus, we bear in mind the possibility that the
committee had an interest in denying the Hesses’ claim, but
the pertinent question remains whether its decision was
arbitrary and capricious.


                              B.
  Ultimately we cannot conclude that the committee’s
decision to deny the Hesses’ claim for diversification was
arbitrary and capricious. The committee relied on the
following plan provision, which controls diversification of
assets in Reg-Ellen stock:
     Within the period of 90 days following the end of each
     Plan year, any Participant in the Plan who has attained
     age 55 and completed at least ten years of participation
     in the Plan shall be permitted to direct the Trustee to
     diversify up to 25 percent (reduced by amounts previ-
     ously diversified) of his accrued benefit in the Employer
     Stock Fund by investing such amount in investments
     other than Employer stock[.]
Reg-Ellen ESOP § 4.12(g).
By its terms, that section allows diversification only for
those plan participants who are 55 years or older, which the
Nos. 04-3408 & 04-3415                                    11

Hesses admittedly were not at the time of the hearing.
Under this provision, there is thus nothing unreasonable
about the committee’s decision to deny the Hesses’ requests
to diversify their Reg-Ellen stock.
  The Hesses, however, claim that amendment 4.12(i)
authorizes diversification. To put their position in perspec-
tive, we quote the amendment in its entirety:
    Notwithstanding any provision of section 4.12 to the
    contrary, that on or after December 1, 1994, there shall
    be no Employer’s Elective Contribution or matching
    contributions on or behalf of Participants. Although
    Participants shall continue to have the right to direct
    the investment of the Participant’s Account as to
    contributions made on or before November 30, 1994,
    Participants shall have no rights pursuant to section
    4.12 to direct the investment of the Participant’s
    Account made on or after December 1, 1994.
Reg-Ellen ESOP Amendment § 4.12(i).
This language leaves much to be desired in terms of clarity.
It is, however, clear that plan participants “continue” to
have some right. The nature of that continued right pro-
vides the primary bone of contention between the Hesses
and Reg-Ellen.
  The Hesses claim that the latter half of section 4.12(i) is
intended to assure participants the continued right to direct
their pre-December 1994 investments between Reg-Ellen
stock and the Other Investments Account. The problem
with this interpretation is that, once invested in Reg-Ellen
stock, the plan did not generally allow participants to move
contributions that had been invested in Reg-Ellen stock to
the Other Investments Account. Prior to the 1995 amend-
ments, contributions made by participants or Reg-Ellen to
either fund were controlled by section 4.12. That section
provides that participants may decide whether contribu-
tions go into Reg-Ellen stock or the other account. Reg-Ellen
12                                   Nos. 04-3408 & 04-3415

ESOP § 4.12(a). Their decision, however, may only be made
prospectively. 

Thus, the right to move
contributions already in Reg-Ellen stock would be a new
right, not a continued right. Before the 1995 amendment
participants were allowed to elect each year whether their
future contributions (in increments of 25%) would be made
to either the Reg-Ellen stock fund or the Other Investments
Account. 

(e). Because there was no right
before 1995 to direct funds previously invested in Reg-Ellen
stock into the Other Investments Account, we are uncon-
vinced by the Hesses’ interpretation of section 4.12(i).
  The committee’s interpretation, however, is also unsatis-
fying. In its decision the committee asserted that the
amendment (presumably 4.12(i), although it is not explicitly
cited) was added for those plan participants who had
contributed their salary reduction contributions to the
Other Investments Account. The committee interpreted the
amendment as maintaining the rights of participants who
had contributed to that account “to direct the investment of
amounts in these other investments.” On this understand-
ing, the committee characterized section 4.12(i) “not [as] a
change to the Plan, but rather a clarification that Partici-
pant’s [sic] maintained this right.” According to Reg-Ellen,
the right the committee is referring to is the right to move
funds within the Other Investments Account, which it says
contains three diversified funds. This interpretation is
problematic because section 4.12(i) by its terms is not
limited to the Other Investments Account—it refers simply
to the “Participant’s Account,” which presumably would
include those assets in Reg-Ellen stock. And like the
Hesses, Reg-Ellen is unable to point to any plan provision
explicitly granting participants the right to move their
contributions within the Other Investments Account before
December 1994, making it questionable whether such a
right could be “continued” on the authority of section 4.12(i).
In short, section 4.12(i) is ambiguous, which leaves us hard-
Nos. 04-3408 & 04-3415                                      13

pressed to conclude that the committee’s interpretation,
which is a reasonable way to resolve the ambiguity, was
arbitrary or capricious. See Gallo v. Amoco Corp., 

, 922 (7th Cir. 1996) (“When as in this case the plan
document does not furnish the answer to the question, the
answer given by the plan administrator, when the plan
vests him with discretion to interpret it, will ordinarily bind
the court. That is implicit in the idea of deferential review
of the plan administrator’s interpretation.”).
  The Hesses, however, suggest that the ambiguity should
work in their favor. Specifically, they argue that because
the amendment is ambiguous, it must be “constructed
against the drafter and in favor of the plaintiffs.” But the
cases they cite to support this proposition (the “contra
proferentem” rule) are cases applying general contract law
or reviewing interpretations of ERISA plans de novo, and
are thus inapplicable here. When a plan gives the adminis-
trator discretion to interpret it, as does Reg-Ellen’s ESOP,
“we cannot merely apply federal common law principles of
contract interpretation, but rather must view the contrac-
tual ambiguity through a lens that gives broad discretion to
the plan administrator to interpret the plan.” Dabertin v.
HCR Manor Care, Inc., 

, 833 (7th Cir. 2004);
see also Ross v. Ind. State Teacher’s Ass’n Ins. Trust, 

, 1101 (7th Cir. 1998) (same). The requirement
that we give deference to the plan administrator’s interpre-
tation is especially applicable when plan language is
ambiguous, for that is precisely when the administrator
exercises his grant of discretion. See 

(ambiguous plan language created “interpretive task
confided” to plan’s trustees).
  We also reject the Hesses’ argument that the ambiguity
should prompt us to look beyond the plan itself to interpret
the amendment. In the district court the Hesses submitted
an affidavit from Lewellen in which he interprets section
4.12(i) to mean that after the 1995 amendments, partici-
14                                  Nos. 04-3408 & 04-3415

pants could direct the trustee to move pre-December 1994
contributions from the stock fund to the Other Investments
Account. Lewellen points out that since the 1995 amend-
ments eliminated employee contributions and Reg-Ellen
matching contributions, section 4.12(i) makes no sense
unless participants “continue” to have the right to invest
their previous contributions in either Reg-Ellen stock or the
Other Investments Account. The Hesses claim that
Lewellen was the plan administrator at the time of the
amendment; indeed, they assert that Lewellen wrote the
amendment. Who better, the argument goes, to explain the
meaning of the amendment?
  There are two problems with their argument. First, they
did not present Lewellen’s interpretation at the hearing
before the current plan administrator, and we have consis-
tently held that our review is limited to the record before
the administrative committee. See Vallone v. CNA Fin.
Corp., 

, 629 (7th Cir. 2004); 

-82 (“Deferential review of an administrative decision
means review on the administrative record.”). Indeed, the
Hesses did not advance any argument based on section
4.12(i) to the committee. The committee addressed section
4.12 only because the Hesses had raised the amendment in
their previous correspondences requesting diversification.

  Secondly, we have explicitly rejected the premise that a
former plan administrator retains authority to construe
plan language, even language he may have drafted. In
White v. Sundstrand Corp., 

, 584 (7th Cir.
2001), a group of plaintiffs seeking benefits under
Sundstrand’s floor-offset pension plan argued that the
interpretation of one of the plan’s drafters should prevail
over the plan administrator’s interpretation. In rejecting
their argument, we pointed out that the plan gave discre-
tion to interpret its language to the plan administrator, not
the drafter. 

2.6 of Reg-Ellen’s ESOP
Nos. 04-3408 & 04-3415                                        15

gives the plan administrator discretion to interpret it, not
Lewellen. As we analogized in White, “A Secretary of Labor
who drafts and promulgates a rule will have leeway to
interpret its language only as long as she remains in office;
when a new Secretary is confirmed, interpretive discretion
comes with the job. The ex-Secretary may write op-ed pieces
trying to influence the rule’s application, but the elbow
room that goes with delegated authority belongs to the
incumbent, not to the author.” 

Just so with
Lewellen. Although he may have had authority to interpret
section 4.12(i) when he administered the ESOP, that
authority passed to Turner when Lewellen retired. That the
new administrator interprets section 4.12(i) differently than
Lewellen does not render his decision arbitrary and capri-
cious. 

that new plan administrators may
change interpretation of plan because the discretion to
interpret plan “goes with the office”). Thus, the fact that
Lewellen may now1 interpret the amendment in a way that
supports the Hesses’ claim does not render the committee’s
contrary interpretation arbitrary and capricious.


                               C.
  The Hesses advance several other attacks on the commit-
tee’s decision, but none render it unreasonable. First, they
make much of a “payout” to another former Reg-Ellen
employee, William Ray. While Lewellen was still president
of Reg-Ellen, he authorized a distribution of Ray’s benefits


1
   We note that both Turner and Morris testified by deposition
that Lewellen’s interpretation represented an about-face from his
alleged earlier insistence that contributions to Reg-Ellen stock
stayed in Reg-Ellen stock. Reg-Ellen suggests that this change of
opinion is linked to Lewellen’s status as an adverse party to Reg-
Ellen in two separate lawsuits, but we see no reason to delve into
the motivation for Lewellen’s interpretation.
16                                    Nos. 04-3408 & 04-3415

to him after he was terminated in 1994. At that time, Ray
(who was 28 years old) had Reg-Ellen stock valued at
$42,293, which was subsequently paid out to him in two
installments. The Hesses maintain that the inconsistent
treatment of Ray renders the committee’s interpretation of
their claim arbitrary and capricious.
   Although we have recognized evidence of inconsistent
interpretations as a factor to be considered in determining
whether a plan administrator’s decision is arbitrary and
capricious, 

, the payout to Ray
does not render the committee’s denial of the Hesses’ claim
suspect. First of all, Ray received a payout, an entirely
different benefit than the diversification John and James
seek. Additionally, the plan treats participants like Ray
who have less than $50,000 in the plan differently. Section
7.4 provides that if the vested portion of a terminated
employee’s account is less than $50,000, the participant
may elect to “cause the entire Vested portion of the Termi-
nated Participant’s Account to be paid to such Terminated
Participant2.” Reg-Ellen ESOP § 7.4(a). For these reasons,
the Hesses’ comparison to Ray is inapt. See 

(“The ‘inconsistency’ on which the plaintiffs harp . .
. is superficial.”). Additionally, the decision to pay out Ray’s
claim happened under Lewellen’s tenure, and thus does
little to prove that the current plan administrator has
applied the plan inconsistently. See 

(pointing out that interpretation of ERISA plan may change
with new plan administrator); see also Chojnacki, 

  Because we think Ray’s treatment has little bearing on Reg-
Ellen’s decision regarding the Hesses’ claims, we do not explore
whether Ray’s payout was proper. It may be that the lump
payments he received contravened certain plan provisions
governing distributions—indeed, Turner claimed in her deposition
that as she interprets the plan, Ray’s payout was “different than
the way the Plan calls.”
Nos. 04-3408 & 04-3415                                       17

at 816 (ERISA plan administrator’s allegedly inconsistent
interpretation in two cases insufficient to render decision to
deny plaintiffs’ claims arbitrary or capricious).
  The Hesses also claim that it was improper for the
committee to rely on section 4.12(g) of the plan instead of
section 7.4, which they claim applies to terminated employ-
ees. But section 7.4, entitled “Determination of Benefits
Upon Termination,” deals with distribution, not diversifica-
tion. It provides that “[d]istribution of the funds due to a
Terminated Participant shall be made on the occurrence of
an event which would result in the distribution had the
Terminated Participant remained in the employ of the
employer.” Reg-Ellen ESOP § 7.4(a). Because the plan
appears to make the requirements for distribution the same
for both current and terminated employees, we see nothing
wrong with the committee’s failure to explicitly mention
section 7.4. in its decision. Section 4.12(g) speaks directly to
the requirements for diversification, which is what the
Hesses claimed they wanted to do. Thus, we find nothing
arbitrary or capricious about the committee’s reliance on
section 4.12(g) to reject the Hesses’ claims.


                              D.
  Alternatively, the Hesses claim that they are entitled to
relief under an estoppel theory. They base their claim on
certain statements Lewellen allegedly made in a November
1995 meeting to explain the 1995 amendments to Reg-Ellen
employees. At that time, Lewellen told the participants that
section 4.12(i) secured their right to direct pre-December
1994 investments into either company stock or the Other
Investments Account. Lewellen further assured employees
that they could change their election once per plan year to
provide for switching between the two funds in multiples of
25%. The Hesses claim that Lewellen was the plan adminis-
trator at that time and that they relied on his interpreta-
18                                      Nos. 04-3408 & 04-3415

tion of section 4.12(i) to their detriment—specifically, they
claim that if they had known that Turner would refuse their
request to diversify, they would have requested a rollover
or a distribution under other plan provisions. 3
  The district court rejected the estoppel claim because the
Hesses had failed to present it to the administrative
committee. Additionally, the district court noted that it was
doubtful whether an oral promise could form the basis of an
estoppel claim under ERISA and pointed out that any
reliance on Lewellen’s promises would not be “reasonable”
since the meaning of section 4.12(i) was disputed.
  In their opening brief, the Hesses take issue with the
court’s observations about whether an oral promise can
support an estoppel claim and whether their reliance on
Lewellen’s assurances was reasonable. They ignore, how-
ever, the district court’s primary ground for rejecting the
estoppel claim—their failure to make it to the appeal
committee. This omission dooms their estoppel claim. See
Senese v. Chicago Area I.B. of T. Pension Fund, 

, 823 (7th Cir. 2001) (appellant’s failure to challenge
independent, alternate ground offered by district court
results in waiver of challenge to alternate ground and
affirmance on that basis).
  In their reply brief the Hesses argue for the first time
that an estoppel claim “may not” be the sort of claim that
must be raised administratively because it is part of the
federal common law that courts are to develop for interpret-


3
   In their opening brief, the Hesses offer an alternative basis for
their estoppel argument: a February 1998 letter from the plan
attorney telling them they were not entitled to a distribution.
Although they claim they relied on this allegedly false representa-
tion to their detriment, we do not explore the issue because the
Hesses raise this argument for the first time on appeal. See Coker
v. Trans World Airlines, Inc., 

, 586 (7th Cir. 1999).
Nos. 04-3408 & 04-3415                                     19

ing ERISA claims. See 

(articulating requirement that courts develop a body of
federal common law of rights and obligations under ERISA-
regulated plans); Coker v. Trans World Airlines, Inc., 

, 585 (7th Cir. 1999) (recognizing estoppel as a
“matter of federal common law in at least some ERISA
cases”). The argument is an interesting one, and has some
support in our case law. See 

(allowing discovery beyond the administrative record on
plaintiff’s estoppel claim because “the estoppel claim is not
a review of a decision of the Plan Administrator”). Interest-
ing as it may be, we do not reach this contention, because
its appearance for the first time in the Hesses’ reply brief
means that it is waived. See, e.g., 

; cf.
JTC Petroleum Co. v. Piasa Motor Fuels, Inc., 

,
780-81 (7th Cir. 1999) ([W]hen a litigant wants a court to
buy a novel theory it has to do more than assert it, wholly
ignoring the objections that have been made to it and the
cases that have questioned or rejected it.”).
  The Hesses also argue in their reply brief that Reg-Ellen
cannot rely on their failure to raise the estoppel claim at
the administrative level because it did not assert that
defense below. Having reviewed Reg-Ellen’s brief in opposi-
tion to the Hesses’ motion for summary judgment, we
disagree. There, Reg-Ellen asserted that since the Hesses
had “presented no claim for promissory estoppel at the . . .
appeal hearing,” the district court should not consider the
claim. This language leaves us at a loss to understand the
Hesses’ position that Reg-Ellen waived the argument,
especially in light of the fact that the district court recog-
nized this defense and relied on it as a ground to reject the
estoppel claim. In sum, we reject the Hesses’ estoppel claim
because they did not defend their failure to raise it before
the administrative committee until their reply brief, and
that is too late. See Jones v. Union Pac. R.R., 

,
741 (7th Cir. 2002) (failure to address one of district court’s
20                                  Nos. 04-3408 & 04-3415

holdings amounts to waiver of any claim of error with
respect to that issue and waiver cannot be cured by argu-
ment in reply brief).


                            III.
  That leaves John Hess’s claim that he was entitled to
inspect Reg-Ellen’s books and records under the Illinois
Business Corporation Act. See 805 ILCS 5/7.75 (requiring
corporations to allow shareholders to examine corporate
books and records for a proper purpose). A claim under the
Business Corporation Act has two components: the re-
quester must be a “shareholder” and have a “proper pur-
pose” for her request. The district court concluded that John
was not a “shareholder,” which the act defines as a “holder
of record shares.” See 805 ILCS 5/1.80(g).
  On appeal, John takes issue with that conclusion, point-
ing out that he received notices of annual shareholder
meetings and also received a letter from Reg-Ellen that
begins “Dear Shareholder” and goes on to explain the
requirements for exercising one’s right to inspect Reg-
Ellen’s books and records. John also received a stock
certificate for his Reg-Ellen shares, although the certificate
was later turned over to the ESOP trustee “for safekeep-
ing.” At the summary judgment stage, we think this
evidence sufficient to allow a factfinder to conclude that
John was a shareholder, notwithstanding Reg-Ellen’s claim
that the ESOP trustee is the holder of record.
  However, John must also have a “proper purpose” for his
request. See 805 ILCS 5/7.75(b) (shareholder of record has
right to examine books and records, “but only for a proper
purpose”). His brief offers us no clues as to the purpose
behind his request to examine Reg-Ellen’s records. This
omission is fatal to his claim because he bears the burden
of demonstrating that his request was made for a “proper
purpose.” See West Shore Assocs., Ltd. v. Am. Wilbert Vault
Nos. 04-3408 & 04-3415                                    21

Corp., 

, 498-99 (Ill. App. 1994). Moreover, a
“mere statement alleging a facially proper purpose is not
enough.” 

made no attempt to demonstrate that
his request was made for a “proper purpose,” which under
Illinois law means acting in good faith, having an honest
motive, and seeking to protect the interests of the corpora-
tion as well as the shareholder. See Corwin v. Abbott Labs.,

, 1251 (Ill. App. 2004); Taghert v. Wesley,

, 381 (Ill. App. 2003). We thus affirm the
district court’s denial of his claim under the Illinois Busi-
ness Corporation Act, although on a different ground. See
Hildebrandt v. Ill. Dep’t of Natural Res., 

,
1032 (7th Cir. 2003) (court of appeals may affirm district
court’s grant of summary judgment on any ground sup-
ported by record).


                            IV.
  For the foregoing reasons, we AFFIRM the district court’s
judgment granting summary judgment to Reg-Ellen and the
Reg-Ellen ESOP.

A true Copy:
      Teste:

                        ________________________________
                        Clerk of the United States Court of
                          Appeals for the Seventh Circuit




                    USCA-02-C-0072—9-6-05