Filed: Jan. 05, 2018
Latest Update: Mar. 03, 2020
Summary: United States Court of Appeals For the Eighth Circuit _ No. 16-1763 _ James Boyd lllllllllllllllllllll Plaintiff - Appellant v. ConAgra Foods, Inc. lllllllllllllllllllll Defendant - Appellee _ No. 16-3443 _ James Boyd lllllllllllllllllllll Plaintiff - Appellee v. ConAgra Foods, Inc. lllllllllllllllllllll Defendant - Appellant _ Appeals from United States District Court for the Eastern District of Missouri - St. Louis _ Submitted: September 20, 2017 Filed: January 5, 2018 [Published] _ Before W
Summary: United States Court of Appeals For the Eighth Circuit _ No. 16-1763 _ James Boyd lllllllllllllllllllll Plaintiff - Appellant v. ConAgra Foods, Inc. lllllllllllllllllllll Defendant - Appellee _ No. 16-3443 _ James Boyd lllllllllllllllllllll Plaintiff - Appellee v. ConAgra Foods, Inc. lllllllllllllllllllll Defendant - Appellant _ Appeals from United States District Court for the Eastern District of Missouri - St. Louis _ Submitted: September 20, 2017 Filed: January 5, 2018 [Published] _ Before WO..
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United States Court of Appeals
For the Eighth Circuit
___________________________
No. 16-1763
___________________________
James Boyd
lllllllllllllllllllll Plaintiff - Appellant
v.
ConAgra Foods, Inc.
lllllllllllllllllllll Defendant - Appellee
___________________________
No. 16-3443
___________________________
James Boyd
lllllllllllllllllllll Plaintiff - Appellee
v.
ConAgra Foods, Inc.
lllllllllllllllllllll Defendant - Appellant
____________
Appeals from United States District Court
for the Eastern District of Missouri - St. Louis
____________
Submitted: September 20, 2017
Filed: January 5, 2018
[Published]
____________
Before WOLLMAN, MELLOY, and GRUENDER, Circuit Judges.
____________
MELLOY, Circuit Judge.
James Boyd, a former employee of ConAgra Foods, Inc., brought this action
pursuant to the Employee Retirement Income Security Act of 1974 (“ERISA”). Boyd
seeks to recover severance benefits under an ERISA plan that guarantees these
benefits when ConAgra, in certain circumstances, materially reduces an employee’s
position, duties, or responsibilities. Boyd alternatively claims that ConAgra breached
its fiduciary duty by misleading him about his employment. The district court1
granted ConAgra summary judgment on these claims and then granted Boyd his
attorney’s fees, pursuant to the plan’s terms. We affirm.
I. Background
Boyd previously worked for Ralcorp Holdings, Inc., in the position of “Vice
President of Operations.” In January 2013, ConAgra purchased Ralcorp through a
corporate acquisition. Following this acquisition, ConAgra retained Boyd as an
employee, changing his job title to “Vice President of Manufacturing.” ConAgra also
assumed Ralcorp’s obligations arising from Ralcorp’s employee-benefits programs.
1
The Honorable John A. Ross, United States District Judge for the Eastern
District of Missouri.
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As part of his employee benefits with Ralcorp and then ConAgra, Boyd was
covered under the “Ralcorp Holdings, Inc. Severance Plan for Exempt Administrative
Employees Eligible for the Ralcorp Holdings, Inc. Management Bonus Program” (the
“Plan”), which is governed by ERISA. Under the Plan, Boyd is entitled to recover
severance benefits after self-terminating his employment within twenty-four months
after a “Change in Control,” including a corporate acquisition of Ralcorp, based on
“Good Reason.” The Plan defines “Good Reason” as “any of the following acts by
the Company without the prior written consent of the Employee: . . . i) a material
reduction in the Employee’s position, duties, or responsibilities; or ii) a material
adverse change in the Employee’s reporting relationships.” The Plan further
provides, “Notwithstanding anything in this definition to the contrary, an act by the
Company shall not constitute ‘Good Reason’ unless the Employee gives written
notice of the same to the Company within 30 days of such act, and the Company fails,
within 30 days of such notice, to reverse such act.” The Plan’s terms give the “Plan
Administrator”—that is, Ralcorp and then ConAgra—“‘the exclusive discretionary
authority to construe and interpret the Plan [and] to decide all questions of eligibility
for benefits,’ including the discretion to decide whether ‘Good Reason’ exists.”
Boyd alleges that after ConAgra acquired Ralcorp, he “suffered a significant
decrease in his responsibilities and his ability to give input on and influence high-
level decisions within the company.” Boyd contends that these changes gave him
“Good Reason,” as defined under the Plan, to self-terminate his employment and to
recover severance benefits under the Plan. Boyd sent ConAgra four letters asserting
that he had Good Reason to self-terminate his employment and to recover severance
benefits. He also communicated with ConAgra on several occasions regarding his
claim for severance benefits. A summary of those letters and communications are as
follows.
In August 2013, Boyd sent ConAgra a letter stating that he believed he had
Good Reason based on the material adverse differences between his job as Vice
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President of Operations for Ralcorp and the position ConAgra had offered Boyd as
Vice President of Manufacturing. Boyd specifically alleged, among other claims, that
the new position decreased his authority over hiring and adversely changed his
reporting relationships.
After receiving Boyd’s August 2013 letter, ConAgra investigated Boyd’s
allegations. When a Plan participant gives notice of a claim of Good Reason to self-
terminate, a committee typically investigates that claim by evaluating the alleged
employment changes and determining whether those changes met the Plan’s
definition of Good Reason. In this case, the investigative committee evaluated
Boyd’s allegations and concluded that ConAgra had not materially reduced Boyd’s
employment in such a manner as would qualify as Good Reason. Based on this
determination, Amy Ariano, the head of the investigative committee and a Vice
President of Human Resources, met with Boyd to discuss his August 2013 letter and
the committee’s findings. Ariano informed Boyd that the committee had investigated
his alleged employment changes and concluded that they did not establish Good
Reason under the Plan’s terms. Following this meeting, Boyd signed an employment
agreement with ConAgra, accepting the position ConAgra had offered him.
In November 2013, Boyd sent ConAgra a second letter detailing additional
employment circumstances that he believed further established Good Reason. These
additional circumstances included: ConAgra “materially eliminating [Boyd’s] capital
approval authority” and delegating to a project manager Boyd’s project-coordination
duties over the “Red Card Project,” a project Boyd oversaw. After receiving this
letter, the investigative committee considered Boyd’s allegations and denied that
Good Reason existed.
In December 2013, Boyd sent ConAgra a third letter describing additional
circumstances he believed further established Good Reason. Boyd alleged that
ConAgra had excluded him from a “Senior Leadership Team Meeting” in November
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2013. The investigative committee considered this allegation and denied that Good
Reason existed.
Kelly Schaefer, ConAgra’s Vice President of Human Resources for Supply
Chain, then met with Boyd over two days in December 2013 to discuss the allegations
in his letters. Schaefer met with Boyd at the direction of the investigative committee
and used talking points that the committee had prepared. Schaefer informed Boyd
that the committee had received his additional letters and had determined that his
alleged employment changes did not establish Good Reason. Schaefer did not
identify what specifically ConAgra would deem to be a “material” reduction in
Boyd’s employment that would establish Good Reason. Schaefer also stated that
Boyd remained the “Business Owner” for the Red Card Project. According to Boyd,
Schaefer failed to inform him that the Red Card Project had been discussed and
overhauled at a “Network Optimization Meeting” earlier in the month.
In early January 2014, Boyd sent ConAgra another letter, stating that he would
self-terminate his employment with ConAgra at the end of the month. In this letter,
Boyd alleged additional circumstances establishing Good Reason to self-terminate:
ConAgra had excluded him from the Network Optimization Meeting and from the
hiring process for a plant manager at one of the plants Boyd supervised. The
committee investigated these claims and concluded that they did not establish Good
Reason. Boyd then terminated his employment with ConAgra on January 31, 2014.
In February 2014, Boyd submitted to ConAgra an administrative claim for
severance benefits under the Plan, alleging he self-terminated for Good Reason based
on the above alleged employment changes. On April 10, 2014, ConAgra—as the Plan
Administrator—denied Boyd’s claim on two grounds: (i) Boyd failed to terminate his
employment within the ninety-day period following the alleged initial existence of
Good Reason, a condition precedent under the Plan; and (ii) Boyd did not have Good
Reason to self-terminate because he “did not incur a material reduction in his
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position, duties or responsibilities or a material adverse change in his reporting
relationships.” On April 28, 2014, Boyd appealed that decision. And in June 2014,
ConAgra upheld its denial of Boyd’s claim.
In August 2014, Boyd sued ConAgra under ERISA, 29 U.S.C. § 1132(a)(1)(B)
and (a)(3), claiming that he is entitled to severance benefits under the Plan and,
alternatively, that ConAgra, as the Plan Administrator, breached its fiduciary duty by
omitting and misrepresenting material information in its discussions with Boyd.
Boyd and ConAgra each filed a motion for summary judgment. The district court
granted ConAgra’s motion and denied Boyd’s motion. The district court concluded
that ConAgra had not abused its discretion under the Plan by denying Boyd’s claim
for benefits because substantial evidence existed to support its decision. The district
court also concluded that ConAgra had not breached its fiduciary duty to Boyd. The
district court then granted Boyd’s motion for attorney’s fees, concluding that the
Plan’s terms entitled Boyd to these fees because Boyd’s claims were not frivolous.
Boyd timely appealed the order granting ConAgra summary judgment, and
ConAgra timely appealed the order granting Boyd his attorney’s fees. This Court has
jurisdiction over these appeals pursuant to 28 U.S.C. § 1291.
II. Discussion
Under ERISA, a plan participant or beneficiary may file an action “to recover
benefits due to him under the terms of his plan.” 29 U.S.C. § 1132(a)(1)(B). “Where
an ERISA plan grants its administrator discretion to decide questions of eligibility for
benefits or construe plan terms”—as the Plan does here—“judicial review of the
administrator’s determinations generally is limited to the abuse of discretion
standard.” Alliant Techsystems, Inc. v. Marks,
465 F.3d 864, 868 (8th Cir. 2006).
When reviewing a district court’s grant of summary judgment on such a claim, “[w]e
review the grant of summary judgment de novo, using the same standard as the
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district court, and we view the evidence in the light most favorable to the nonmoving
party.” Admin. Comm. of Wal-Mart Stores, Inc. Associates’ Health & Welfare Plan
v. Gamboa,
479 F.3d 538, 541 (8th Cir. 2007).
The parties here raise three broad issues on appeal. First, Boyd challenges the
district court’s conclusion that ConAgra, as the Plan Administrator, did not abuse its
discretion in denying Boyd’s claim for benefits. Second, Boyd challenges the district
court’s decision that ConAgra, as Boyd’s fiduciary under the Plan, did not breach its
fiduciary duty by allegedly omitting or misstating material information. And third,
ConAgra cross-appeals, arguing that the district court erred in awarding Boyd his
attorney’s fees because the Plan prohibits awarding attorney’s fees for frivolous
claims.
A. Boyd’s Claim for Severance Benefits
The first issue we consider is whether ConAgra, as the Plan Administrator,
abused its discretion in denying Boyd’s claim for severance benefits. The parties
disagree as to the level of deference we must afford ConAgra’s decision and whether
that decision was in error.
1. Applicable Standard of Review
Boyd first argues that the district court applied an incorrect standard of review
because ConAgra’s financial conflict of interest necessitated a less deferential
standard. As noted above, judicial review of a plan administrator’s decision denying
a claim for benefits under an ERISA plan similar to the one here generally is limited
to the abuse-of-discretion standard. Under this standard, “[t]he administrator’s
decision should be affirmed if it is reasonable, meaning it is supported by substantial
evidence.” Green v. Union Sec. Ins.,
646 F.3d 1042, 1050 (8th Cir. 2011). In other
words, “[the] decision is reasonable if a reasonable person could have reached a
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similar decision, given the evidence before him, not that a reasonable person would
have reached that decision.”
Id.
Because, under the Plan here, ConAgra served as the party responsible both for
administering the Plan (i.e., the plan administrator) and for paying claims under the
Plan (i.e., the plan sponsor), “this dual role creates a [financial] conflict of interest.”
Metro. Life Ins. v. Glenn,
554 U.S. 105, 108 (2008); accord Manning v. Am.
Republic Ins.,
604 F.3d 1030, 1038 (8th Cir. 2010). When such a conflict of interest
exists, “a reviewing court should consider that conflict as a factor in determining
whether the plan administrator has abused its discretion in denying benefits.”
Glenn,
554 U.S. at 108; accord Brake v. Hutchinson Tech. Inc. Grp. Disability Income Ins.
Plan,
774 F.3d 1193, 1196 (8th Cir. 2014) (citing
Glenn, 554 U.S. at 116–17).
Boyd asserts that a less deferential standard of review governs our review of
ConAgra’s decision. To be clear, although these two propositions—on the one hand,
applying a less deferential standard of review and, on the other hand, considering the
conflict of interest as a factor under the abuse-of-discretion standard—appear
substantially similar, they are distinct concepts. For his proposition, Boyd cites Woo
v. Deluxe Corp.,
144 F.3d 1157, 1160–61 (8th Cir. 1998), and its progeny. Under
these cases, this circuit permitted “a less deferential standard of review” when the
claimant shows “a palpable conflict of interest or a serious procedural irregularity
existed, which . . . caused a serious breach of the plan administrator’s fiduciary duty
to [him].” Menz v. Procter & Gamble Health Care Plan,
520 F.3d 865, 871 (8th Cir.
2008) (alteration in original) (emphasis added) (quoting
Woo, 144 F.3d at 1160).
This less deferential standard is a “‘sliding scale’ approach, [whereby] the evidence
supporting the plan administrator’s decision must increase in proportion to the
seriousness of the conflict or procedural irregularity.”
Woo, 144 F.3d at 1162.
The Supreme Court’s decision in
Glenn, 554 U.S. at 115–16, abrogated Woo
to the extent Woo allowed a less deferential standard of review based on merely a
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conflict of interest. Wrenn v. Principal Life Ins.,
636 F.3d 921, 924 n.6. To the
extent Boyd contends that Woo governs because a “conflict of interest influenced
ConAgra’s decision to deny Boyd’s claim and appeal,” this argument is foreclosed
by Glenn. See
Glenn, 554 U.S. at 115–17; see also Cooper v. Metro. Life Ins.,
862
F.3d 654, 660 (8th Cir. 2017) (“[Eighth Circuit] precedent . . . has consistently
rejected the notion that the mere presence of a potential conflict of interest is
sufficient to warrant a less deferential standard.”).
Boyd also argues that Woo governs because there was a procedural irregularity
when Schaefer, who met with Boyd about his Good Reason letters, misled him by
falsely stating that he retained decision-making authority over the Red Card Project.
“Our circuit has not definitively resolved the impact of Glenn on the ‘procedural
irregularity component’” of Woo. Waldoch v. Medtronic, Inc.,
757 F.3d 822, 830
n.3 (8th Cir. 2014) (quoting
Wrenn, 636 F.3d at 924 n.6). We need not address the
validity of that component, however, because Boyd has failed to show Schaefer’s
statement was a “serious procedural irregularity.”
Woo, 144 F.3d at 1160.
Notwithstanding the veracity of Schaefer’s statement, Boyd has not shown that the
statement significantly diverged from the administrative procedures involved when
the Plan Administrator considered this type of claim. See
id. at 1161 (concluding that
failing to investigate an ERISA plan beneficiary’s claim of disability was a
procedural irregularity). Boyd therefore has failed to show that a less deferential
standard of review governs.
Although we do not apply a less deferential standard of review, ConAgra’s
financial conflict of interest is still a relevant factor we consider in determining
whether ConAgra abused its discretion in denying Boyd’s claim. The weight
afforded this factor necessarily depends on the facts of the case. Some facts this
circuit previously recognized as increasing that weight include: “that the insurer’s
claims review process was tainted by bias; that the medical professionals who
reviewed the claim for [disability] benefits were employed by the insurer, or that their
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compensation was tied to their findings; and that the insurer acted as little more than
a rubberstamp for favorable medical opinions.”
Cooper, 862 F.3d at 661. But when
the record “contains no evidence about [the plan administrator]’s ‘claims
administration history or its efforts to ensure that claims assessment is not affected
by the conflict,’ [the court] only ‘give[s] the conflict some weight.’” Donaldson v.
Nat’l Union Fire Ins. Co. of Pittsburgh,
863 F.3d 1036, 1039 (8th Cir. 2017) (quoting
Darvell v. Life Ins. Co. of N. Am.,
597 F.3d 929, 934 (8th Cir. 2010)). In short, a
financial conflict of interest is only a factor—the weight of which depends on the
facts of the case. See
Glenn, 554 U.S. at 115. We thus consider this factor in our
analysis of Boyd’s claim, which now follows.
2. Good Reason Analysis
Boyd next contends that ConAgra, as the Plan Administrator, abused its
discretion by denying his claim for benefits, based on two grounds. Boyd first asserts
that ConAgra abused its discretion by denying his claim on the ground that it was
untimely. The Plan provides that to be eligible to apply for severance benefits, a
qualifying employee must self-terminate “during the 90-day period following the
initial existence of Good Reason.” ConAgra concluded that Boyd had failed to timely
self-terminate because he filed his first Good Reason letter in August 2013 but he did
not self-terminate until January 2014. In fact, in his February 2014 claim for benefits
and his April 2014 appeal of ConAgra’s decision, the allegations that Boyd cited as
establishing Good Reason occurred in November and December of 2013—i.e., fewer
than ninety days before Boyd self-terminated on January 31, 2014. Nevertheless,
ConAgra concluded that Boyd had failed to timely self-terminate. The district court
concluded that this was an abuse of discretion. Notwithstanding the merits of Boyd’s
argument on this claim, we need not address it because ConAgra ultimately succeeds
based on its determination that Boyd did not have Good Reason.
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Boyd also argues that ConAgra, as the Plan Administrator, abused its discretion
in denying his claim on the ground that Boyd did not have Good Reason to self-
terminate. In his administrative appeal, Boyd alleged only three adverse changes in
his employment: (i) ConAgra excluded Boyd from the Senior Leadership Team
Meeting in November 2013; (ii) ConAgra excluded Boyd from the Network
Optimization Meeting in December 2013; and (iii) ConAgra excluded Boyd from the
decision-making process for the replacement of a plant manager at a plant Boyd
supervised. We view these allegations, as we must, in the light most favorable to
Boyd.2
We hold that ConAgra did not abuse its discretion in determining that Boyd
lacked Good Reason to self-terminate. The record demonstrates that, in his prior
position with Ralcorp, Boyd would not have been invited to the Senior Leadership
Team Meeting. ConAgra also explained that it did not invite Boyd to the Network
Optimization Meeting because the meeting focused on topics outside of Boyd’s
responsibilities. Finally, in both Boyd’s prior position and his position with
ConAgra, Boyd’s supervisor had the authority to make decisions—without Boyd’s
involvement—regarding the replacement of a plant manager. ConAgra thus
2
Now in this suit, Boyd also alleges that ConAgra increased the number of
supervisors between Boyd and the Chief Executive Officer; that, at the Network
Optimization Meeting, ConAgra materially changed the Red Card Project, which
Boyd oversaw, without his input; and that ConAgra delegated to another employee
Boyd’s project-coordinator duties over the Red Card Project. But, as ConAgra asserts
and the district court found, Boyd did not raise these additional allegations in his
appeal of ConAgra’s denial of his claim for benefits. Boyd therefore failed to exhaust
his administrative remedies surrounding these allegations, and he is barred from
raising the allegations now. See Chorosevic v. MetLife Choices,
600 F.3d 934, 942
(8th Cir. 2010) (“It is well-established that when exhaustion is clearly required under
the terms of an ERISA benefits plan, the plan beneficiary’s failure to exhaust her
administrative remedies bars her from asserting any unexhausted claims in federal
court.” (quoting Burds v. Union Pac. Corp.,
223 F.3d 814, 817 (8th Cir. 2000))).
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concluded that Boyd’s alleged employment changes did not establish Good Reason.
Because “a reasonable person could have reached a similar decision,”
Cooper, 862
F.3d at 660, we must accept ConAgra’s decision. Boyd therefore has failed to show
that ConAgra’s decision was unreasonable or was not supported by substantial
evidence.
Although we also consider as a factor in our analysis the conflict of interest
underlying the Plan, this does not change our conclusion in this case. In advocating
greater weight for this factor, Boyd argues that ConAgra’s conflict of interest is
evinced by its purportedly erroneous determination that Boyd did not timely self-
terminate. This argument, however, fails to persuade us that ConAgra’s decision was
unreasonable. And as ConAgra introduced some testimony describing the procedural
safeguards surrounding its administration of the Plan, this decreases the weight we
afford the conflict-of-interest factor. See
Glenn, 554 U.S. at 117 (“[The conflict of
interest] should prove less important (perhaps to the vanishing point) where the
administrator has taken active steps to reduce potential bias and to promote accuracy
. . . .”).
Accordingly, because ConAgra’s decision was reasonable, we hold that
ConAgra did not abuse its discretion in denying Boyd’s claim for benefits.3
3
Boyd also contends that the district court improperly required him to show a
material reduction in his position, duties, and responsibilities, though the Plan
requires a showing on only one—not all three. Boyd’s argument is misguided.
Regardless of the scope of the district court’s conclusion, we review that conclusion
de novo and conclude that ConAgra did not abuse its discretion in determining that
it had not materially altered Boyd’s job responsibilities, position, or duties.
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B. Boyd’s Claim for Breach of Fiduciary Duty
The district court concluded that ConAgra did not breach its fiduciary duty to
Boyd by misstating or omitting certain material information when communicating
with him. We agree.
An ERISA fiduciary—that is, a person who exercises certain discretionary
authority or control over an ERISA plan, see 29 U.S.C. § 1002(21)(A)—must
“discharge [its] duties with respect to [the] plan solely in the interest of the
participants and beneficiaries.” 29 U.S.C. § 1104(a)(1). This includes an “obligation
to deal fairly and honestly with all plan members.” Shea v. Esensten,
107 F.3d 625,
628 (8th Cir. 1997) (citing Varity Corp. v. Howe,
516 U.S. 489, 506 (1996)).
“Accordingly, a fiduciary may ‘not affirmatively miscommunicate or mislead plan
participants about material matters regarding their ERISA plan’ when discussing a
plan.” Kalda v. Sioux Valley Physician Partners, Inc.,
481 F.3d 639, 644 (8th Cir.
2007) (quoting In re Xcel Energy, Inc.,
312 F. Supp. 2d 1165, 1176 (D. Minn. 2004)).
In asserting a breach of fiduciary duty, Boyd must show that he reasonably relied, to
his detriment, on a material misrepresentation or omission. See Yafei Huang v. Life
Ins. Co. of N. Am.,
801 F.3d 892, 900 (8th Cir. 2015); see also
Kalda, 481 F.3d at 644
(“A statement is materially misleading if there is ‘a substantial likelihood that it
would mislead a reasonable employee in the process of making an adequately
informed decision regarding . . . benefits to which she might be entitled.’” (quoting
Krohn v. Huron Mem’l Hosp.,
173 F.3d 542, 551 (6th Cir. 1999))).
Boyd contends that ConAgra breached its fiduciary duty when Schaefer, acting
at the direction of the investigative committee and therefore as a fiduciary, misled him
about his authority over the Red Card Project. Boyd specifically alleges that Schaefer
assured him he retained authority and control over the project and that she failed to
inform him that the project had been changed at the December 2013 Network
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Optimization Meeting. Boyd also alleges that he relied, to his detriment, on
Schaefer’s representation by self-terminating his employment and then seeking
severance benefits. By misleading Boyd about his authority over the Red Card
Project, he contends, Schaefer “caused him to delay his self-termination, and
ultimately to self-terminate without the necessary information that ConAgra withheld
from him.”
Even assuming Schaefer was Boyd’s fiduciary, we conclude that Boyd has
failed to show his purported reliance was reasonable. To support his allegation that
the Red Card Project was changed at the Network Optimization Meeting, Boyd
highlights several statements from a PowerPoint presentation presented at the
meeting. In fact, the district court found that Boyd had received a copy of this
PowerPoint on January 23, 2014 (about one month after Boyd’s meeting with
Schaefer). Boyd thus was equipped with this information—and would have known
about the purported changes to the Red Card Project—both before he self-terminated
on January 31, 2014, and before he submitted his administrative claim for severance
benefits on February 7, 2014. Because Boyd possessed this information before he
purportedly acted in reliance on Schaefer’s misstatement, he has failed to show that
he reasonably relied, to his detriment, on a material misrepresentation or omission.
See Yafei
Huang, 801 F.3d at 900. Boyd’s claim that ConAgra breached its fiduciary
duty through Schaefer’s conduct therefore fails.
Boyd also states that he “was not given any guidance concerning the definition
of Good Reason or what ConAgra considered a material reduction in job duties,
responsibility or authority.” In so stating, Boyd appears to argue that this omission
was a breach of ConAgra’s fiduciary duty. Under ERISA, “a fiduciary has a duty to
inform when it knows that silence may be harmful, and cannot remain silent if it
knows or should know that the beneficiary is laboring under a material
misunderstanding of plan benefits.”
Kalda, 481 F.3d at 644 (citations omitted).
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Here, however, there was no such silence. The Plan defines the term “Good
Reason,” and this definition includes certain “material” adverse changes in
employment. Although the term “material” was not defined in the Plan, ERISA
requires only that a Plan be “written in a manner calculated to be understood by the
average plan participant.” 29 U.S.C. § 1022(a). The average plan participant
reasonably could understand the defined provisions for “Good Reason” and the
common meaning of “material.” Boyd, in fact, concedes this in his brief, stating:
“Fortunately, the plain language of the Plan clearly lists events which would
constitute the requisite Good Reason.” Boyd therefore has failed to demonstrate that
ConAgra breached its fiduciary duty by not further defining these terms or by listing
events that qualify as Good Reason.
C. ConAgra’s Challenge to the Attorney’s Fees Award
The final issue on appeal is whether the district court erred in granting Boyd
the attorney’s fees he incurred in pursuing his claims. ConAgra contends that the
district court erred in granting these attorney’s fees because the Plan prohibits
awarding attorney’s fees for frivolous claims and because Boyd’s above claims were
frivolous. This Court reviews the legal issues surrounding an award of attorney’s fees
de novo. Gen. Mills Operations, LLC v. Five Star Custom Foods, Ltd.,
703 F.3d
1104, 1112 (8th Cir. 2013).
The Plan entitles Boyd to recover his attorney’s fees incurred in pursuing his
claims, unless the claims were frivolous:
In connection with or after a Change in Control, the Company
[ConAgra] shall pay to the Employee [Boyd] as incurred all legal and
accounting fees and expenses incurred by the Employee in seeking to
obtain or enforce any right or benefit provided by this Plan under Article
II(B), unless the Employee’s claim is found by a court of competent
jurisdiction to have been frivolous.
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In another context, the Supreme Court has clarified that a claim is frivolous when it
lacks “any rational argument in law or fact.” Neitzke v. Williams,
490 U.S. 319, 323
(1989) (citation omitted).
The district court concluded that Boyd’s claims were not frivolous. We agree.
Although we ultimately reject Boyd’s claims against ConAgra, his claims were not
lacking “any rational argument in law or fact.”
Id. Although we did not address
Boyd’s claim regarding ConAgra’s determination that Boyd was ineligible to apply
for benefits because his self-termination was untimely, we believe there was a
substantial—or at least arguable—basis for this claim. The district court, in fact,
concluded that ConAgra had abused its discretion in deeming Boyd’s self-termination
untimely. Further, the facts surrounding Boyd’s breach-of-fiduciary-duty claim
provided an arguable basis that Schaefer had misled or omitted certain material
information. For these reasons, we affirm the district court’s ruling awarding Boyd
his attorney’s fees incurred in pursuing these two claims.4
III. Conclusion
For the foregoing reasons, this Court affirms the district court’s judgment.
______________________________
4
As neither party raised the issue in its opening brief, we do not address the
district court’s ruling on ConAgra’s motion for attorney’s fees and costs under 29
U.S.C. § 1132(g)(1). See Food Mkt. Merch., Inc. v. Scottsdale Indem. Co.,
857 F.3d
783, 789 (8th Cir. 2017) (“‘As a general rule, [this court] will not consider arguments
raised for the first time in a reply brief,’ and declines to do so here.” (alteration in
original) (quoting Barham v. Reliance Standard Life Ins.,
441 F.3d 581, 584 (8th Cir.
2006))).
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