1 14-1496-cv Sanford v. TIAA-CREF Indiv. & Inst. Servs., LLC UNITED STATES COURT OF APPEALS FOR THE SECO ND CIRCUIT SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT. CITATION TO A SUMMARY ORDER FILED ON OR AF TER JANUARY 1, 2007, IS PERM ITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PR OCEDURE 32.1 AND THIS CO URT’S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER IN A DOCUMEN T FILED WITH THIS CO URT, A PARTY MUST CITE EITHER THE FEDERAL APPENDIX OR AN ELECTRONIC DATA BASE (WITH THE NOTATION “SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL. At a stated term of the United States Court of Appeals for the Seco nd Circuit, held at the Thurgood Marshall United Stat es Courthouse, 40 Foley Sq uare, in the City of New York, on the 27 th day of April, two thousand fifteen.
PRESENT: JOHN M. WALKER, JR., REENA RAGGI, CHRISTOPHER F. DRONEY, Circuit Judges

.

---------------------------- ---------------------------- -------------- WILLIAM F. SANFORD, indivi dually and as Executor of the Estate of Gerlinde U. Sanford, Plaintiff-Appellant , v. No. 14-1496-cv
TIAA-CREF INDIVIDUAL & INSTITUTIONAL SERVICES, LLC, GERD SCHNEIDER, GEORGIA SCHNEIDER, Defendants-Appellees

.

---------------------------- ---------------------------- -------------- APPEARING FOR APPELLANT: ROBIN L. ROBERTS, Roberts & Associates, Hattiesburg, Mississippi.
APPEARING FOR APPELLEES: W. BR ADLEY HUNT, Mackenzie Hughes LLP, Syracuse, New York, for TIAA-CREF Individual & Institutional Services, LLC. SUZANNE O. GALBATO (Kate I. Reid, on the brief ), Bond, Schoeneck & King, PLLC,2 Syracuse, New York, for Gerd Schneider and Georgia Schneider. Appeal from a judgment of the United States District Court for the Northern District of New York (Mae A. D’Agostino, Judge ). UPON DUE CONSIDERATION, IT IS HEREBY ORDERE D, ADJUDGED, AND DECREED that the judgment entere d on March 31, 2014, is AFFIRMED. Plaintiff William F. Sanfor d (“Sanford”) appeals from (1) an award of summary judgment in favor of defendant TIAA-CRE F Individual & Institutional Services, LLC (“TIAA-CREF”) on Sanford’s ERISA claims for benefits under his deceased wife’s (“Gerlinde Sanford”) retiremen t and annuity plans, see 29 U.S.C. § 1132(a)(1)(B), and (2) the subsequent dismissal of his state-law claims against defenda nts Gerd and Georgia Schneider, see 28 U.S.C. § 1367(c)(3). Sanf ord contends that the district court (1) erroneously reviewed TIAA-CREF’s denial of be nefits for arbitrariness and capriciousness rather than de novo, (2) abused its discretion by refusing to consider evidence outside the administrative record, and (3) erroneously held that TIAA-CREF permissibly denied his claim for benefits. Sanford further argues that if his ERISA claims ar e reinstated, then his state-law claims should be reinstated as well, but he concedes that if the award of summary judgment is affirmed then the state-law claims were properly dismissed. We assume the parties’ familiarity with the facts and the record of prior proceedings, which we reference only as necessary to explain our decision to affirm. 1. Standard of Review A district court reviews a denial of a be nefits claim de novo “unless the benefit plan3 gives the administrator or fiduciary discreti onary authority to de termine eligibility for benefits or to construe the terms of the plan .” Firestone Tire & Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); accord Thurber v. Aetn a Life Ins. Co., 712 F.3d 654, 658 (2d Cir. 2013). To qualify, a plan’s grant of discreti onary authority must be unambiguous. See Kosakow v. New Rochelle Radiology Assocs ., P.C., 274 F.3d 706, 739 (2d Cir. 2001). For the reasons set forth below, we conclude that summary judgment in TIAA-CREF’s favor would be appropriate ev en under de novo review. We therefore need not decide whether the dist rict court erred by not applying de novo review in the first instance or whether the plans at issue unamb iguously grant discretionary authority to
TIAA-CREF. 2. Refusal To Consider Evidence Outside the Ad ministrative Record We review for abuse of discretion a distri ct court’s decision to consider evidence outside the administrative record on de novo re view. See Muller v. First Unum Life Ins. Co., 341 F.3d 119, 125 (2d Cir. 2003). A district court reviewing a denial of benefits de novo may consider evidence outside the administrative record if it finds “ good cause” to do so. Id. (internal quotation marks omitted). Here, the district court held that Sanford had failed to establish good cause because he “never submitted the record s [at issue] to TIAA –CREF, despite having possession of them and despite having several months to submit the information prior to TIAA–CREF’s decision to pay the sibling bene ficiaries.” Sanford v. TIAA-CREF Indiv. & Inst. Servs., LLC, No. 12 Civ. 1254 (MAD), 2014 WL 1311 827, at *9 (N.D.N.Y. Mar.4 31, 2014); see also Muller v. Fi rst Unum Life Ins. Co., 341 F. 3d at 125–26 (i dentifying no good cause where plaintiff had “ample time to submit a dditional materials” into administrative record and failed to do so). Sanford argues this failure should be ex cused because there is no evidence that TIAA-CREF informed his then -attorney of the need to submit documents into the administrative record. We note that Sanfor d did not make this ar gument in his motion to expand the record. See Pl.’s Mot. Expand R., Sanford v. TIAA-CREF Indiv. & Inst. Servs., LLC, No. 12 Civ. 1254 (MAD) (N.D.N.Y. May 14, 2013), Doc. No. 108. Rather, he first raised it in his cro ss-motion for summary judgment as part of his argument that TIAA-CREF had acted arbitrarily and capricious ly by not following proper procedures. See Pl.’s Mem. Supp. Summ. J. at 11–14, Sa nford v. TIAA-CREF Indiv. & Inst. Servs., LLC, No. 12 Civ. 1254 (MAD) (N.D.N.Y. Oct. 22, 2013), Doc. No. 122. In any event, even assuming TIAA-CREF was required to info rm Sanford’s attorney of the need to submit documents, Sanf ord bears the burden of demonstrating good cause, see DeFelice v. Am. Int’l Life Assur. Co. of N.Y., 112 F.3d 61, 67 (2d Cir. 1 997), which burden he cannot meet merely by pointing to a lack of evidence that TIAA-CREF satisfied that requirement. Absent some affirmative evidence of a fail ure to notify—for example, an affidavit from Sanford’s former attorney—the district court did not abuse its discretion by identifying no good cause and refusing to consider ev idence outside the ad ministrative record.5 3. Affirming Denial of the Claim Sanford argues that TIAA-CREF’s denial of his claim was erroneous for three

reasons. First, Sanford argues that TIAA-C REF should not have accepted the change-of-beneficiaries form reducing his pe rcentage of benefits because Gerlinde Sanford lacked mental capacity at the time she signed the power-of-a ttorney authorizing the change of beneficiaries. This argumen t lacks factual support in the administrative record. Under New York law, which both par ties agree governs the agency relationships at issue in this case, a third party may re ly on a power-of-attorney unless it has “actual knowledge that the principal lacked capacity to execute” the power-of-attorney. N.Y. Gen. Oblig. Law § 5-1504(3). The only evidence in the administrative record relating to Gerlinde Sanford’s alleged in capacity was a second-hand st atement by Sanford’s attorney that, according to a nurse’s note, Gerlinde Sanford “had difficulty moving her arm” and “had . . . been confused” before she signed the power-of-attorney . J.A. 653; see also J.A. 405. That statement is in sufficient by itself to demonstrate TIAA-CREF’s “actual knowledge” of Gerlinde Sanford’s inca pacity at the time she executed the power-of-attorney. Moreover , although Sanford faults TIAA-CREF’s failure to investigate further, the record shows that TIAA-CREF waited over a month after hearing of the nurse’s note to allow Sanford to subm it documentary support and denied the claim only after none was submitted. See J.A. 567, 56 9. Accordingly, TIAA-CREF permissibly relied on the power-of-attorney.6 Second, Sanford argues that the plans at is sue require a participant personally to execute any change of beneficiaries and theref ore implicitly forbid us e of attorneys-in-fact or other agents. Sanford is correct that the plans state that “Participant[s]” may designate beneficiaries and do not mention agents. J.A. 45, 101. This does no t, however, support a conclusion that agent use is proscribed. In ERISA cases involving claims under 29 U.S.C. § 1132(a)(1)(b), we interpret plans according to “federal common law,” which “is largely informed by state law principles . . . [and] familiar rules of contract interpretation.” Lifson v. INA Life Ins. Co. of N.Y., 333 F.3d 349, 352 –53 (2d Cir. 2003). Under those principles, a properly authorized agent ma y act on a principal’s behalf to change beneficiaries absent some explicit limitation in the plan. See Re statement (Third) of Agency § 6.01 cmt. b (2006) (“An agent ha s power to make contracts on behalf of the agent’s principal when th e agent acts with actual or appa rent authority.”); see also N.Y. Gen. Oblig. Law § 5-1502L(2) (stating that a ttorney-in-fact may “c hange the designation of beneficiaries in effect for any . . . retire ment benefit or plan” if so authorized by a “statutory gifts rider”); N.Y. Gen. Oblig. La w § 5-1514(3)(c)(7) (stating that principal may authorize agent to change “benef iciary or beneficiaries of any type of retirement benefit or plan”); J.A. 435 (statutory gifts rider signed by Gerlinde Sanford specifically authorizing agents to change beneficiar ies for TIAA-CREF account). Metropolitan Life Insurance Co . v. Sullivan, 96 F. 3d 18 (2d Cir. 1996 ), is not to the contrary. That case held that a statutory requ irement, contained in a statute not applicable here, that beneficiaries be “designated by th e employee in a signed and witnessed writing”7 forbade the use of agen ts to change beneficiaries and pr eempted state contract law allowing the use of agents. Id. at 19 –20. Here, however, there is no similar restriction on how participants may designate beneficiaries. While in Metropolitan Life Insurance Co., employees had to make their designations by means of “a signed and witnessed writing,” the plans in this case are agnostic as to th e method of designation used and, therefore, cannot be read implicitly to forbid common (and, in New York, statutorily authorized) means such as designation through an agent. Accord ingly, TIAA-CREF permissibly allowed the change in beneficiar ies by means of a power-of-attorney. 1 Third, Sanford argues that the change of beneficiaries was invalid because, although the power-of-attorney required the two attorneys-in-fact to act jointly, only one attorney initialed a modification to the percentage of benefits for the new beneficiaries on the change-of-beneficiaries form. We need no t address how this joint-action requirement applied to every document modification. The alleged omission here pertains only to the relative percentages of benefits given to th e new beneficiaries, wh ereas the only change that affects Sanford—the reduction of his pe rcentage of benefits from 100% to 50%—was signed by both attorney s-in-fact and was unaffected by th e modification. See J.A. 361– 363. Accordingly, the modification initialed by only one attorney-in-fact offers Sanford no support.

1 In light of our conclusion that the change of beneficiaries complied with the terms of the plans, we need not address whether “substan tial compliance” would have been sufficient. See Metropolitan Life Ins. Co . v. Johnson, 297 F.3d 558, 567 (7th Cir. 2002); Phoenix Mut. Life Ins. Co. v. Adams, 30 F.3d 554, 564–65 (4th Cir. 1994).8 Sanford also argues that TIAA-CREF committe d a number of proce dural errors that deprived him of the op portunity to submit add itional evidence to TI AA and to challenge the change of beneficiary. See Appellant’s Br. 29–35. Sanford was aware of the change in beneficiary since at leas t June 2010, however, and he and his attorney were in discussions with TIAA-CREF about the designation since at least August 2010. TIAA-CREF gave Sanford over a month to challenge the designation and to submit documentary support, which he did not do. Sa nford’s claim that he was deprived of the opportunity to challenge TIAA-CREF’s deci sions is therefore meritless. Because TIAA-CREF’s alleged procedural deficiencies were at worst harmle ss error, we need not address the merits of Sanf ord’s procedural arguments. We have considered plaintiff’s remaini ng arguments and concl ude that they are without merit. We therefore AFFIRM the judgment of the district court.
FOR THE COURT: CATHERINE O’HAGAN WOLF E, Clerk of Court