### IN THE UNI TED STAT ES COURT OFAPPEALS FOR THE FIF TH CIRCU IT

No. 11-30120

DANA D. CAPLES, Plaintiff-Appellant, versus U.S. FOODSERVICE, INC.; HEWITT ASSOCIATES, LLC, Defendants-Appellees.

Appeal from the United States District Court for the Eastern District of Louisiana

No. 2:08-CV-4878

Before SMITH, BARKSDALE, and BENAVIDES, Circuit Judges. JERRY E. SMITH, Circuit Judge: *

Dana Caples (“Caples”) appe a l s a summary judgment in favor of U.S. Foodservice, Inc. (“USF”), and Hewitt Associates, LLC (“Hewitt”; collectively, U n i te d S ta te s C o u rt o f A p p ea l s

F i ft h C i rc u i t 

### F I L E D Octob er 6, 20 11 Lyle W . Cayce Clerk

Pur sua nt to 5 T H C IR

. R. 47.5 , the co urthas det erm inedthat this op inion sho uld not * be publ ish ed and is not pr ece dent excep t unde r the lim ite d cir cum st ance s se t for th in 5 T H C IR

. R. 47.5 .4. 1 Case: 11-30120 Document: 00511625808 Page: 1 Date Filed: 10/06/2011No. 11-30120

“defendants”), alleging that defendants undermined her life insurance claim in violation of the Em p l o yee Retirement Income Security Act of 1974 (“ERISA”). Because the plan administrator relied on s u b s t a n tial evidence when it determined that Caples was not the beneficiary of her deceased ex-husband’s policy, we affirm on the ground that Caples lacks standing to sue under ERISA.

I. Caples married David Caples (“Mr. Caples”) in 2002. In 2004, Mr. Caples was hired as a driver for defendant USF. As a USF employee, he was entitled to various insurance benefits, including group life insurance. Wh e n h is life insurance coverage took effect in 2004, he had designated Caples as his primary beneficiary and, as secondary beneficiary, his son Daniel Caples (“Daniel”), who is not Caples’s biological child; he also elected spousal life insurance coverage for Caples and child life insurance for Daniel. I n F e bruary 2005, the couple separated. Later that year, Hewitt assu m ed responsibility for administering USF’s benefits management system, taking over from a previous third-party manager. USF implemented a new manage ment system and required its employees to contact Hewitt to make benefits decisions afresh. The change in systems, coinciding with the change in system managers, me a n t that USF employees specifically had to elect coverage under th e ir employer’s various benefits offerings, including l i f e insurance; those who failed to contact Hewitt would receive no coverage
. Employees had the option to desig n a t e beneficiaries for life insurance but inst e a d could elect life insurance without designating a beneficiary, in which

case the benefit would be paid to the first of the following: “(a) surviving spouse; (b) surviving child(ren) in equal shares; (c) surviving parents in equal shares; (d) surviving siblings in equal shares; (e) estate.” P R U D E N T I A L I N S

. C O

. O F AM ., U.S. F O O D S E RV I C E , I N C .: N O N

- U N I O N E M P L O Y E E S 42 (2007).

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As of January 2006, Mr. Caples had elected various coverages for himself and Daniel, including life insurance, under Hewitt’s new benefits management system. He did not elect life insurance coverage for Caples and did not designate a beneficiary for his own life insurance. The couple’s separation ended in divorce in March 2006. The divorce did not terminate their relationship, however: they lived together from May 2006 through January 2007, they revived their romantic relat i o n s h ip the following
summer, and in August Mr. Caples even proposed re-marriage. Mr. Caples died in September 2007 of an apparent suicide. As of his death, Mr. Caples had elected various coverages for himself and Daniel, including life insurance; he could not elect coverage for Caples, because she was no longer his wife. Though the couple may have renewed their relationship before Mr. Caples died, he never designated a life insurance beneficiary after failing to do so in Hewitt’s new system. Prudential Insurance Company of America (“Prudential”), the life insurance plan administrator, was informed by 1 USF through Hewitt that Mr. Caples had died without a designated beneficiary. According to its written policy, Prudential paid $56,000 to Daniel as Mr. Caples’s sole surviving child; because of the divorce, he had no surviving spouse. Caples sued Prudential in state court, and Prudential removed to federal court. Caples amended to add USF a n d Hewitt as defendants and dismissed Prudential. The district court then had Caples submit her claim to Prudential for administrative review. Based on the evidence filed by all parties, Prudential found that it was correct to pay Daniel the $56,000 at issue. Her administrative remedies under ERISA exhausted, Caples returned to the district court with her

Eff ect ive Januar y 1, 2007, USF had canc eled its lif e ins uranc e cont rac t wi th Ha rtf ord 1 Insur ance and cont rac ted wi th Prud enti al to pr ovide thos e benef its ins tead

. Unli ke USF’ s earlier change of benef

its man agers to Hew itt , this change app aren tly nece ss itat ed no act ion by USF em plo yees . The change fr om Ha rtf ord to Prud enti al doe s not app ear to have aff ect ed the ord er in wh ich the ins urerp ays out benef its w here no be nef

icia ry w as on rec ordatd eath

. 3 Case: 11-30120 Document: 00511625808 Page: 3 Date Filed: 10/06/2011No. 11-30120

c o mplaint; defendants renewed their motion for summary judgment. Th e d i s trict court granted the motion and dismissed Caples’s claims with prejudice.

II. A summary judgment is r e v i e w e d de novo , under the same standard applied by the district c ourt. McDaniel v. Anheuser-Busch, Inc. , 987 F.2d 298, 301 (5th C i r. 1993). Summary judgment is appropriate only “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” F E D
. R. C I V
. P. 56(a). See Anderson

v. Liberty Lobby, Inc. , 477 U.S. 242, 249-50 (1986). A dispute about a material fact is “genuine” if the evi d e n c e is such that a reasonable jury could return a verdict for the non-moving party. Id. at 248. The court must draw all justifiable inferences in favor of the non-moving party. Id. at 255. Once the moving party h a s i n i t i a l ly shown “that there is an absence of evidence to support the nonmoving party’s case,” Celotex Corp. v. Catrett , 477 U.S. 317, 325 (1986), the nonmovant must come forward with specific facts showing a genuine factual issue for trial , M

a t s u s h i t a Elec. Indus. Co. v. Zenith Radio Corp. , 475 U.S. 574, 587 ( 1 9 8 6)

. C o nc lu sional allegations a n d d e ni al s , s p e c ul ati o n , i m p rob ab l e i nf e r e nc e s , un s ub s t a nti at e d a s s e rti o n s , and legalistic argumentation do not adequately substitute for specific facts showing a genuine issue for trial. SEC v. Recile , 10 F.3d 1093, 1097 (5th Cir. 1993).

A. Caples must first establish her standing to sue under ERISA. “We have recognized that standing is essential to the exercise o f j urisdiction and is a ‘threshold question

... [that] determines the power of the court to entertain the suit.’” Coleman v. Champion Int’l Corp./Champion Forest Prods. , 992 F.2d 530, 532 (5th Cir. 1993) (quoting Warth v. Seldin , 422 U.S. 490, 498 (1975)). ERISA

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gives a plan beneficiary standing 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.” 29 U.S.C. § 1132(a)(1)(B). The law defines a “beneficiary” as “a person designated 2 by a participant, or by the terms of an employee b e n e f i t plan, who is or may become entitled to a benefit thereunder.” 29 U.S.C. § 1002(8). Caples has standing under ERISA if she can establish that she is a beneficiary. We now turn to that question.

B. The insurance plan in effect at Mr. Caples’s death gives Prudential sole discretion to interpret the insurance contract, to make factual findings, and to determine eligibility f or benefits. P R U D E N T I A L I N S

. C O

. O F AM
. , U.S. F O O D S E R

V I C E , I N C .: N O N

- U N I O N E M P L O Y E E S 9 (2007). Under ERISA, if a plan gives discretionary authority to a plan administrator to determine beneficiaries, that factual determination is reviewed for abuse o f d i scretion. Dutka v. AIG Life Ins. Co. , 573 F.3d 210, 212 (5th Cir. 20 0 9 )

. “In applying the abuse of discretion standard to an administrator’s factual determinations we analyze whether the administrator acted arbitrarily or capriciously.” Id. at 213. “If the determination is supported by substantial evidence, it is not arbitrary and capricious.” Id. “Substantial evidence is more than a scintilla, less t h a n a preponderance, and is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Id. (internal quotation marks omitted).

The sam e pr ovis ion als o grant s st andi ng to plan par ti c i p a n ts , def ined as “any 2
em plo yee o r for me r em plo yee of an em plo yer, or any me mbe r or for me r me mbe r of an em plo yee organi zatio n, wh o is or may beco me eligibl e to rec eive a benef it of any type fr om an em plo yee benef

it plan wh ich cover s em plo yees of suc h em plo yer or me mbe rs of suc h organi zatio n, or wh os e benef

icia ries may be eligibl e to rec eive any suc h benef it. ” 29 U. S. C. § 1002( 7). Caple s doe s not clai m to be a p art icip ant. 5 Case: 11-30120 Document: 00511625808 Page: 5 Date Filed: 10/06/2011No. 11-30120 C. Applied at the summary judgment s t a g e , ERISA’s substantial-evidence standard of review for plan administrators’ factual determinations means that Caples carries a heavy burden: She must not merely show evidence demonstrating a genuine issue as to who is the rightful beneficiary. Instead, she must show there was not substantial evidence in the administrative record supporting Prudential’s determination, such that its finding for Daniel was an abuse of discretion. Caples has not carried her burden. 3 The evidence in the administrative record supporting Prudential’s determination is indeed substantial. In October 2005, Hewitt was retained by USF to take o v er USF’s employee benefits management system from the previous

Caple s’ s brie f ask s this cour t to mo dif y its evide ntiar y st andar d by cra ft ing and app ly- 3 ing a fed eralc om mo n-la w doc tri ne of sub st antia l c om pli ance , unde r wh ich
an insur ed s ubs tant ially com pli es w ith the cha nge of bene fic iary pr ovis ions of an ERISA lif

e ins uranc e pol icy wh en the ins ured : (1) evide nces his or her inte nt to mak e the change and (2) att em pt s to eff ect uate the change by unde rta ki ng pos itive act ion wh ich is for all pr act ical pur pos es sim ilar to the act ion requ ired by t he change of benef icia ry p rovis ions of

t he pol icy.
Phoenix M

ut. Lif e Ins. Co. v. A dam s , 30 F. 3d 554, 564( 4th Cir. 199 4) (quo ting Phoenix M ut. Lif e Ins. Co. v. Ada ms , 828 F. Sup p. 379, 388 (D .S .C. 1993)

. App lying that doc tri ne, Caple s argu es th at h er ex -hu sb a n d never sub st antia lly com pli ed wi th the change- of- benef icia ry pr oce dur e sup pos edl y need ed to rem ove her as a benef icia ry. Ass umi ng ar

guendo that sub st antia l com pli ance app lies to ins ured per so ns’ change- of- benef icia ry pr oce dur es , how ever, its app lica

tio n doe s Caple s no good

. When He wi tt beca me USF’ s new benef its man ager, Mr

. Caple s wa s noti fie d that he wo uld need to mak e ins uranc e elec tio ns and benef icia ry des ignati ons anew or los e cover age alto gethe r. Agai nst that back dr op, his aff irm ative se lect ion of cover age for him se lf and his so n (as bef ore He wi tt’ s tak e-o ver) , his fai lure to cover his now -s epa rat ed wi fe (unl ik e bef

ore ), and his fai lure to des ignate any benef icia ries for h i s lif

e ins uranc e (unl ik e bef ore ) all sugges t his inte nt to rem ove Caple s as benef icia ry, a change he eff

ect ed by his contac t wi th He wi tt’ s benef its m anagem ent sys tem

. This cour t inde ed evaluat es chall enges to ERISA pr oce dur es unde r a sub st antia l-c om pli ance st andar d, see Lacy v. Fulbr ight & Jaw ors ki , 405 F.3d 254, 257 (5t h Cir. 2005) (p er cur iam ), but we have app lied the st a n d a r d o n l y to evaluat e wh ethe r plan adm inis tra tor s have sub st antia lly com pli ed wi th the requ irem ents unde r 29 U. S. C. § 1133, nam ely, wh ethe r they give reas ons for denyi ng clai ms and wh ethe r they off er opp ort uniti es for app eal. We have no needt o d ecid e t he app licabilit y of t he sub st antia l-c om pli ances tand ardhe re.

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manager. As part of the transition, USF’s employees were required to log into Hewitt’s new automated benefits election system or call the USF benefits center administered by Hewitt; employees would no longer receive benefits if they did not contact Hewitt by a certain ti m e . To preserve coverage, then, a USF employee had to contact Hewitt’s system, specifically elect health, life, and other insurance, and choose whether to cover himself alone or to cover family as well. Most im p o r t a n t l y, he also had the option to designate a beneficiary for his life insurance or to leave the designation blank; Hewitt’s automated system did not force an employee to designate a beneficiary. Hewitt’s records, as supplied to Prudential, indicate that between October 2005 and January 1, 2006, Mr. Caples e lected various insurance benefits for himself and his son, including life and health insurance. He did not choose any benefits for Caples, however, from whom he was s e p a rated at the time and would subsequently d iv o r ce. He did not designate any beneficiary for his life insurance. The above evidence from the administrative record is manifestly “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Dutka , 573 F.3d at 213 (internal quotation marks omitted). Mr. Caples complied with the requirement to contact Hewitt and elect insurance coverage. In contacting Hewitt, he had opportunities to choose coverage for Caples and to designate her as his beneficiary, but he did not, unlike his choices in the benefits management system operated by Hewitt’s predecessor, in which he had Caples covered and designated as the primary beneficiary of his life insurance. The difference is that, apparently, between Mr. Caples’s last contact with Hewitt’s predecessor’s system and his first contact with Hewitt’s, he and Caples separated. Although there is no direct evidence of Mr. Caples’s knowingly deciding not to designate Caples, the showing that he made other conscious decisions in the same benefits system, combined wi t h the showing that Mr. Caples had

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reason not to des i gnate Caples (namely, their separation), is indeed evidence substantial enough t o support Prudential’s determination that Daniel Caples was the proper beneficiary. Caples’s proffered evidence complicates defendants’ showing slightly but

comes nowhere close to demonstrating that defendants have failed to show that th e p l a n a d m i ni s tr at o r’ s b e n e f ic i ary d e t e rmination was supported by substantial evidence, even when Caples’s evidence is viewed in the most favorable light possible. Caples offers three major attacks on the weight of the evidence: the des- 4 ignation of Caples in the (discontinued) pre-Hewitt system; the absence of evidence directly demonstrating that Mr. Caples consciously declined to designate Caples when using Hewitt’s system; and defendants’ failure to corroborate the sworn affidavits of their records custodians. At most, these could be read to demonstrate, respectively, that defendants did not transmit Mr. Caples’s outdated designation of Caples; Mr. Caples did not deliberately decline to designa t e C a ples; and defendants have not done everything possible to eradicate doubt about Mr. Caples’s responsibility f o r the records. But these putative showings do not impugn the l a test electronic records generated by Mr. Caples’s interaction with Hewitt’s ben e fits system as doing

s o m e thi n g o th e r th a n ge nuinely recording his insurance choices and no n - ch o ic e s . Crucially, Caples has given the court no reason why the electronic records offered by defendants, included in the administrative record, are not “such relevant evidence as a reasonable mind might accept as adequate to support a conclusion.” Dutka , 573 F.3d at 213 (internal quotation marks omitted). The defenFor the firs t tim e on app eal, Caple s alleges “a clea r and app aren t conf lict of intere st 4 by Prud enti al se rving as clai ms adm inis tra tor , and the pr ovide r of the gr o u p lif e ins uranc e pol icy pr ovide d to David Caple s’ em plo yer. ” This cour t wi ll not cons ide r evide nce or argum ents that we re not pr es ente d to the dis tri ct cour t. Ni ssh o-Iw ai Am

. Corp

. v. Kli ne , 845 F.2d 1300, 1 3 0 7 (5t h Cir. 1988) ; Little v. Liqui d Ai r Corp

. , 37 F.3d 1069, 1071 n.1 (5t h C i r . 1 9 9 4 ) (enban c)

. 8 Case: 11-30120 Document: 00511625808 Page: 8 Date Filed: 10/06/2011No. 11-30120

dants have shown that there was evidence in the administrative record substantial enough to mak e Pru d e nti al ’ s ulti mate determination reasonable. Caples has not shown otherwise.

III. Given Prudential’s decision, supported by substantial evidence, that Daniel is the rightful beneficiary of Mr. Caples’s life insurance benefits, Caples is not

a beneficiary under ERISA. Consequently, she lacks standing t o bring a civil action under § 1132(a)(1)(B), under theories of breach of contract/fiduciary duty, negligence, or anything else. 5 AFFIRMED.

Caples appe ars to have drop pedher st ate law clai ms entir ely, “[h] aving dete rm ined 5 [as he r brie f st ates ] thatERISA pr eem pt s st ate law wi th regar d to the det erm inati on of the benef icia ry o f lif

e i nsur ancep roc eed s. ” 9 Case: 11-30120 Document: 00511625808 Page: 9 Date Filed: 10/06/2011