1The Honorable Gregory W. Carman, Chief Judge, United States Court of

International Trade, sitting by designation.

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

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Nos. 00-1320/3673

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Brenda Fletcher-Merrit, *

*

Appellee, * On Appeal from the United

* States District Court for the

v. * Western District of Arkansas

*

 NorAm Energy Corporation, *

*

Appellant. *

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Submitted: April 9, 2001

 Filed: May 21, 2001 

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Before BOWMAN and FAGG, Circuit Judges, and CARMAN,1 Judge.

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CARMAN, Judge.

Appellant NorAm Energy Corporation (NorAm) appeals from the district court’s

determination that NorAm abused its discretion in denying Appellee Brenda FletcherMerrit long-term disability (LTD) benefits. NorAm argues the district court improperly

applied an abuse of discretion standard by substituting its opinion for that of the plan

administrator. NorAm also appeals from the district court’s award of attorney’s fees
2To continue to receive LTD benefits after meeting the 130-day eligibility

requirement, an employee must prove total disability, meaning that: (1) during the first

two years of LTD benefits the employee cannot perform the primary duties of her

regular occupation; and (2) after two years of LTD benefits, the employee cannot

perform the duties of any occupation for which the employee is or could be qualified

by training, education, or experience. In addition, the employee must be under the care

of a physician throughout the 130-day eligibility period and during receipt of benefits.

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and expenses to appellee. For the reasons stated below, we reverse and remand for

action not inconsistent with this opinion.

Factual and Procedural Background

Before receiving LTD benefits under NorAm’s plan, an employee must be

disabled for 130 days (not necessarily consecutive).2 NorAm’s benefits staff initiates

the LTD claim process before an employee has been disabled for 130 days in order to

avoid a delay in benefits once the employee completes the 130-day eligibility

requirement. To qualify as disabled during the eligibility period, the employee must be

unable, because of sickness, injury or pregnancy, to perform with reasonable continuity

the material duties of her own occupation. A direct issue in this case is whether Brenda

Fletcher-Merrit was unable, because of sickness or injury, to perform the material

duties of her occupation. This court reviews whether the district court erred in holding

that the plan administrator (NorAm’s compensation and benefits committee) abused its

discretion in denying LTD benefits to Brenda Fletcher-Merrit. 

As a customer-service representative for NorAm, Brenda Fletcher-Merrit’s

responsibilities included: (1) receiving and processing customer payments; (2)

communicating directly with customers concerning service requests, overdue accounts,

complaints and inquiries; (3) preparing and/or reviewing collection orders; (4)

transmitting and receiving electronic meter reading data; (5) providing clerical support;

and (6) reviewing and correcting standard and special request reports. 
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On March 11, 1996, Brenda Fletcher-Merrit left work to undergo

bunionectomies. She was disabled for approximately 65 days, until her June 9, 1996

recovery date. The plan administrator considered whether Brenda Fletcher-Merrit

fulfilled the LTD eligibility requirement by remaining disabled for approximately 65

days after her recovery from the bunionectomies but determined there was no evidence

to support that the combination of her conditions or symptoms would restrict her from

working as a customer service specialist.

On May 31, 1996, Brenda Fletcher-Merrit consulted Dr. Baxley, a cardiologist,

regarding chest palpitations. On June 25, 1996, Dr. Baxley sent a letter to her

employer stating his opinion that due to Brenda Fletcher-Merrit’s medical conditions,

she was not able to perform her job and he doubted she would ever be able to be

gainfully employed. In July 1996, Brenda Fletcher-Merrit applied for LTD benefits,

listing her illnesses as breast cancer and arthritis and her symptoms as headaches and

chest, neck, back and foot pain. On the LTD Attending Physician Statement dated July

8, 1996, Dr. Baxley recommended Brenda Fletcher-Merrit stop working because of

“multiple associated medical conditions aggravated by her job” and described her

physical, mental and work activity limitations as headaches, arthritis, chest pain, and

chronic neck, back, and foot pain.

NorAm, through Standard Insurance Company, reviewed the information

submitted by physicians treating Brenda Fletcher-Merrit. The information included Dr.

Baxley’s May 31, 1996 summary of her stress echo study and his Cardiac Physician’s

Report to the insurance company, dated June 26, 1996, which discussed his diagnosis

of Brenda Fletcher-Merrit’s hypertension. On October 1, 1996, NorAm denied Brenda

Fletcher-Merrit LTD benefits because it determined that none of her conditions

disabled her from performing the material duties of her position. A review of the

medical records found: no evidence of arthritis, a June 9, 1996 recovery date for her

bunionectomies, no recurrence of breast cancer (which had been in remission since July

1993), normal CT scans regarding her headaches, no symptoms of depression and
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anxiety severe enough to limit Brenda Fletcher-Merrit from working (and no evidence

of regular care and treatment for depression and anxiety after June 20, 1996), and no

trend in increased blood pressure readings that would indicate

continuous limitation in her activities.

On October 11, 1996, NorAm informed Brenda Fletcher-Merrit that its decision

to deny LTD benefits remained the same after Dr. Fancher, the insurance company's

physician consultant, reviewed the exercise stress test results from Brenda FletcherMerrit’s first visit to Dr. Baxley. It attached an October 4, 1996 memo in which Dr.

Fancher stated Brenda Fletcher-Merrit’s cardiac exam was within normal limits. He

also stated that if she had an atrial tachycardia condition, she could perform light or

sedentary work.

Brenda Fletcher-Merrit requested a review of the decision and also submitted

evidence of carpal tunnel syndrome from a Dr. Houk. In a January 27, 1997 memo to

Standard Insurance Company, Dr. Fancher discussed why each of Brenda FletcherMerrit’s conditions should not impair her from working. On February 5, 1997,

Standard Insurance notified Brenda Fletcher-Merrit that the October 1, 1996 denial of

benefits was being upheld because neither her carpal tunnel syndrome nor the

combination of her conditions impaired her from working in her own occupation. On

March 7, 1997, an independent review by Standard Insurance Company’s quality

assurance unit agreed with the denial. On May 27, 1997, Brenda Fletcher-Merrit filed

suit under the Employee Retirement Income and Security Act (ERISA) seeking LTD

benefits under the LTD plan offered by NorAm. ERISA permits a plan beneficiary to

sue to recover benefits due her under the terms of the plan. See 29 U.S.C.

§1132(a)(1)(B).

On December 20, 1999, the district court entered an order in favor of Brenda

Fletcher-Merrit and determined that NorAm abused its discretion in denying Brenda

Fletcher-Merrit’s claim for LTD benefits. The district court stated:
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After carefully reviewing the stipulated record, the Court is

persuaded that the decision by the administrator was unsupported by

substantial evidence, and thus, was an abuse of discretion. Although the

record reflects that the administrator through Standard and Quality

Assurance gathered the medical records documenting plaintiff’s claim, it

ignored the evidence such as [her oncologist] Dr. Mariann Harrington

who noted that plaintiff’s back had felt better since she has [sic] been off

work and the opinion of her regular treating physician, Dr. Baxley, that

plaintiff should avoid stressful situations. In addition, [physician

consultant] Dr. Francher admitted that he could not easily ascertain

plaintiff’s psychological condition and that [psychologist] Dr. Diner felt

the claimant suffered from poly substance abuse in a depressive disorder,

as well as a personality disorder and had moderate impairment to stressful

work conditions. Although he clearly offered “to review any other

records you might have or obtain pertaining to the claimant’s mental

health condition,” no further inquiries were made of her mental health

either in obtaining the prior records of her treatment from 1991 to 1993

or arranging for her to be evaluated in this crucial area. The numerous

references throughout the records concerning plaintiff’s anxiety and stress

were dealt with by just observing that she had not sought treatment

although the decision to discontinue treatment was not recommended by

Dr. Diner. Her erratic behavior regarding her visits with Dr. Diner in light

of her mounting health problems, significant life changes of being

orphaned and married in just months, and Dr. Baxley’s observations

should not have been disregarded[,] thereby rendering the denial as being

without substantial evidence.

Brenda Fletcher-Merrit v. NorAm Energy Corp., No. LR-C-97-502 (E.D. Ark,

Dec. 20, 1999) (order).
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Standard of Review

The plan provides that “[t]he plan administrator has the right and responsibility

to interpret the respective plan, to decide all issues concerning it, and to establish rules

and procedures.” Because the plan gives discretion to the plan administrator, the plan

administrator’s decision is reviewed for an abuse of discretion. See Firestone Tire &

Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989); see also Layes v. Mead Corp., 132

F.3d 1246, 1250 (8th Cir. 1998). The court of appeals reviews a district court’s

application of the abuse of discretion standard de novo. See McGarrah v. Hartford

Life Ins. Co., 234 F.3d 1026, 1030 (8th Cir. 2000).

 

The court of appeals reviews an award of attorney’s fees for an abuse of

discretion. “An abuse of discretion occurs when the district court ‘commits a clear

error of judgment’ in weighing the relevant factors.” Maune v. Int’l Bhd. Of Elec.

Workers, Local No. 1, Health and Welfare Fund, 83 F.3d 959, 964 (8th Cir. 1996)

(quoting Continental Assurance Co. v. Cedar Rapids Pediatric Clinic, 957 F.2d 588,

594 (8th Cir. 1992)). The relevant factors to consider in determining whether fees and

costs should be awarded in an ERISA action are: (1) the degree of culpability or bad

faith assignable to the opposing parties; (2) the ability of the opposing parties to pay

an award of attorney’s fees; (3) the deterrent effect an award would have on others

acting under similar circumstances; (4) whether the fees are requested to benefit other

plan participants or to resolve legal issues specific to ERISA; and (5) the relative merits

of the parties’ positions. See Lawrence v. Westerhaus, 749 F.2d 494, 495-96 (8th Cir.

1984) (per curiam).

Discussion

Under the abuse of discretion standard, “the proper inquiry is whether the plan

administrator’s decision was reasonable; i.e., supported by substantial evidence.”

Donaho v. FMC Corp., 74 F.3d 894, 899 (8th Cir. 1996). In considering the
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reasonableness of a plan administrator’s fact-based disability determination, courts

should consider whether the decision is supported by substantial evidence. See id. at

900. “Substantial evidence is more than a mere scintilla. It means such relevant

evidence as a reasonable mind might accept as adequate to support a conclusion.”

Consol. Edison Co. of New York v. N.L.R.B., 305 U.S. 197, 229 (1938). Both the

quantity and quality of the evidence may be considered. See Donaho, 74 F.3d at 900.

Given the quantity of evidence considered, the plan administrator reasonably

determined that Brenda Fletcher-Merrit was not disabled after her June 9, 1996

recovery from the bunionectomies. Only Dr. Baxley stated Brenda Fletcher-Merrit

could not work, and he based his recommendation upon ailments treated by other

physicians, none of whom stated Brenda Fletcher-Merrit could not work. The district

court highlights the oncologist’s comment that Brenda Fletcher-Merrit’s back felt better

since she had been off work, but the record contains no statement by the oncologist that

Brenda Fletcher-Merrit could not work because of her back. In addition, the district

court states that Dr. Diner, the psychologist, did not recommend a discontinuance of

treatment for her anxiety and stress. However, in the psychiatric questionnaire

completed for the insurance company, Dr. Diner stated Brenda Fletcher-Merrit was

capable of working for her current employer and that her condition was not caused, or

contributed to, by her employment. In reviewing Brenda Fletcher-Merrit’s medical

records, the plan administrator found no evidence of arthritis and no recurrence of

breast cancer (which had been in remission since July 1993). In addition, the records

indicated a June 9, 1996 recovery date for her bunionectomies and normal CT scans

regarding her headaches (as well as an absence of treatment for vascular headaches

after June 12, 1996). The quantity of evidence in the record supports the plan

administrator’s decision and is not “overwhelmed by contrary evidence.” Donaho, 74

F.3d at 901. 

The quality of the evidence relied upon by the plan administrator also supports

a finding that the determination was reasonable. Dr. Fancher, the physician consultant,
3A reviewing physician’s opinion is generally accorded less deference than that

of a treating physician. Donaho v. FMC Corp., 74 F.3d 894, 901 (8th Cir. 1996).

However, the treating physician’s opinion does “not automatically control, since the

record must be evaluated as a whole.” Bentley v. Shalala, 52 F.3d 784, 786 (8th Cir.

1995). We contrast this case with House v. The Paul Revere Life Ins. Co., 241 F.3d

1045, 1048 (8th Cir. 2001), in which the specialist had treated his patient’s severe heart

disease for a decade and Donaho, 74 F.3d at 901, in which two treating physicians and

an examining physician contradicted the reviewing physician’s conclusions. 

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addressed each of Brenda Fletcher-Merrit’s conditions. In his memo to Standard

Insurance Company, he stated that individuals with atrial tachycardia are not disabled

from sedentary work and found Dr. Baxley’s recommendation that Brenda FletcherMerrit could not work because of high blood pressure to be unwarranted after only one

office visit. He stated that his own patients with hypertension can work absent unusual

circumstances, and Brenda Fletcher-Merrit’s hypertension was not so severe. He

acknowledged the ambiguous nature of Brenda Fletcher-Merrit’s psychological

condition but anticipated that if psychological factors still caused her impairment, it

would seem she would have continued to receive mental health counseling and

psychiatric care. Because a reasonable mind might accept Dr. Fancher’s evidence as

adequate to support the conclusion that Brenda Fletcher-Merrit was not disabled after

June 9, 1996, the plan administrator's determination was reasonable.3

A plan administrator’s discretionary decision is not unreasonable merely because

the reviewing court disagrees with it. See Donaho, 74 F.3d at 899. Because the plan

administrator offered a reasonable explanation for its decision, it “should not be

disturbed even if another reasonable, but different, interpretation may be made.” Id.

(quoting Krawczyk v. Harnischfeger Corp., 41 F.3d 276, 279 (7th Cir. 1994)). The

district court made another reasonable, but different, interpretation of the evidence

when it focused upon the oncologist’s statement that Brenda Fletcher-Merrit’s back had

felt better since being off work and when it considered Brenda Fletcher-Merrit’s stress

and anxiety as indicators of disability. However, in applying the abuse of discretion
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standard, the district court may not simply substitute its opinion for that of the plan

administrator. The court must determine whether a reasonable person could have

reached the same decision as the plan administrator. See House v. The Paul Revere

Life Ins. Co., 241 F.3d 1045, 1048 (8th Cir. 2001). Here, a reasonable person could

have found the oncologist’s statement about Brenda Fletcher-Merrit’s back insufficient

to indicate disability and could have concluded Brenda Fletcher-Merrit’s psychological

condition did not disable her because of her voluntary discontinuance of mental health

counseling and her psychologist’s statement that she was capable of working. Because

substantial evidence supported the plan administrator’s decision, the district court erred

in its review for abuse of discretion. 

The district court also erred in awarding attorney’s fees of $6,875.00 and

expenses of $324.25 to Brenda Fletcher-Merrit. The court of appeals reviews an award

of attorney’s fees for an abuse of discretion. “An abuse of discretion occurs when the

district court ‘commits a clear error of judgment’ in weighing the relevant factors.”

Maune v. Int’l Bhd. Of Elec. Workers, Local No. 1, Health and Welfare Fund, 83 F.3d

959, 964 (8th Cir. 1996) (quoting Continental Assurance Co. v. Cedar Rapids

Pediatric Clinic, 957 F.2d 588, 594 (8th Cir. 1992)). This court finds the district court

committed a clear error of judgment in weighing the relevant factors. First, the plan

administrator's decision to deny benefits, supported by substantial evidence, does not

constitute culpable conduct. Second, although NorAm can pay an award of attorney’s

fees, this factor alone does not justify an award where the other factors dictate against

one. See Continental Assur. Co. v. Cedar Rapids Pediatric Clinic, 957 F.2d 588, 595

(8th Cir. 1992). Third, an award would not deter others acting under similar

circumstances. Fourth, an award would not benefit other plan participants or resolve

significant legal issues specific to ERISA. Fifth, both parties' positions had merit.

Attorney's fees should not have been awarded to Brenda Fletcher-Merrit. 

Accordingly, we reverse and remand for action not inconsistent with this opinion.
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A true copy.

 ATTEST:

CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.