Cohn v. Western & Southern Financial Group Long Term Incentive and Retention Plan I

UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION

PAUL D. COHN,

Plaintiff,

:

v.

Case No. 1:19-cv-943

Judge Sarah D. Morrison

WESTERN & SOUTHERN

FINANCIAL GROUP LONG

TERM INCENTIVE AND :

RETENTION PLAN I, et al.,

Defendants.

OPINION AND ORDER

Plaintiff Paul D. Cohn brings this ERISA action against Defendants Western

& Southern Financial Group Long Term Incentive and Retention Plan I (the “Plan”)

and its sponsor, Western & Southern Financial Group, Inc., after a determination

that Mr. Cohn’s Plan benefits were the subject of forfeiture and recoupment efforts.

(See Am. Compl., ECF No. 16.) The Administrative Record was filed under seal

(Admin. R. Pt. 1, ECF No. 11; Admin. R. Pt. 2, ECF No. 23) and the parties moved

for judgment thereon (Pl.’s Mot., ECF No. 24; Defs.’ Mot., ECF No. 25). Mr. Cohn

and Defendants have each responded to the other’s motion (ECF Nos. 26, 28), and

replied in support of their own (ECF Nos. 28, 31). The matter is now ripe for

consideration.

For the reasons set forth below, Mr. Cohn’s Motion for Judgment on the

Administrative Record (ECF No. 24) is DENIED as to the forfeiture of Units

remaining in the Plan and GRANTED as to recoupment of benefits already

distributed, and Defendants’ Motion for Judgment on the Administrative Record

(ECF No. 25) is GRANTED as to the forfeiture and DENIED as to recoupment.

I. FACTUAL BACKGROUND

A. Mr. Cohn was employed as Managing Director of Fort

Washington’s Private Equity Team for 12 years.

From 2006 to 2018, Mr. Cohn was employed as Managing Director of the

Private Equity Team at Fort Washington Investment Advisors Inc., a subsidiary of

Western & Southern. (Am. Compl., ECF No. 16, ¶ 6.) Mr. Cohn describes his work

as follows:

Within [Fort Washington’s] Private Equity unit, Mr. Cohn was on the

secondary investment team.

As part of the secondary investment team, Mr. Cohn assisted General

Partners (“GP”) and Limited Partners (“LP”) with their private equity

investments. For LP’s, the secondary team would often find solutions

to provide liquidity. For GP’s the secondary team might provide

restructuring solutions to allow GPs more time to mature their fund

holdings with new incentives in place and/or to provide “dry powder” to

protect promising investments. These are very sophisticated services

and Mr. Cohn operated at a high level and was very successful for

[Fort Washington].

(Admin. R. Pt. 1, PAGEID # 393.)

Mr. Cohn left employment with Fort Washington in October 2018 due to his

frustration relating to compensation matters. (Id., PAGEID # 396.)

B. Over the course of his employment, Mr. Cohn was awarded 160

Performance Units under the Plan.

Notwithstanding his ultimate frustration, Mr. Cohn was highly compensated

by Fort Washington. As a component of his compensation, he was invited to

participate in the Plan. (Pl.’s Mot., 3.) The Plan is a “top hat” plan1 reserved for only

the highest earning employees of Western & Southern. During his tenure, Mr. Cohn

was awarded 160 Performance Units under the Plan. (Admin. R. Pt. 1, PAGEID

# 265.) As of his termination, 117.2 Units had vested. (Id.) Of those, 57 Units

(valued at $ 304,146.00) had been paid out in accordance with Mr. Cohn’s written

distribution election. (Id., PAGEID # 265, 358, 360.)

C. Western & Southern learned that Mr. Cohn began a competing

enterprise, and exercised the Plan’s forfeiture provision. Mr.

Cohn appealed the determination, which was upheld by the

Executive Committee.

On May 31, 2019, Western & Southern’s Senior Vice President for

Compensation & Benefits wrote Mr. Cohn, stating that the balance of his

Performance Unit Account was forfeited and that his distributed Plan benefits were

subject to recoupment. (Id., PAGEID # 265–67.) The letter attributed the forfeiture

1 ERISA defines a “top hat” plan as “a plan which is unfunded and is

maintained by an employer primarily for the purpose of providing deferred

compensation for a select group of management or highly compensated employees.”

29 U.S.C. § 1051(2). Top hat plans are exempt from certain of ERISA’s

requirements. See 29 U.S.C. § 1051. The Sixth Circuit has explained:

The purpose of the “top hat” exception to ERISA coverage has been

characterized by the Department of Labor as a recognition by Congress

“that certain individuals, by virtue of their positions or compensation

level, have the ability to affect or substantially influence, through

negotiations or otherwise, the design and operation of their deferred

compensation plan . . . and would, therefore, not need the substantive

rights and protections of” ERISA.

Bakri v. Venture Mfg. Co., 473 F.3d 677, 678 (6th Cir. 2007) (citing DOL, Office of

Pension & Welfare Benefit Programs, Opinion 90–14A, 1990 WL 12393,3 at *1 (May

8, 1990)).

to Mr. Cohn’s “business relationship or employment” with a competitor called Tail

End Capital Partners, and cited the provision of the Plan disallowing such

competition within three years of termination. (/d.)

Mr. Cohn requested the documents that formed the basis of the benefit

determination. d., PAGEID # 268.) In response, he received:

e A Foreign Registration Statement filed with the Pennsylvania

Department of State for Tail End Managing Member I, LLC. CUd.,

PAGEID # 373-74.) The Statement identifies Tail End Managing

Member I, LLC as a Delaware limited liability company seeking to do

business in Pennsylvania. It is dated April 29, 2019, and signed by Mr.

Cohn as Sole Member.

e Print-outs of a website for an entity called RIVVER, identifying Mr.

Cohn as an “Advisor” and Tail End Capital Partners as a “Partner.”

(Ud., PAGEID # 375-76.) Mr. Cohn’s photo is accompanied by the

following:

30-year Private Equity and Secondary Markets veteran.

Former Managing Partner at Fort Washington

Investment Advisors ($3.2B AUM). Currently managing

partner at Tail End Capital Partners.

The following Tail End Capital Partners logo also appears:

TAIL | END CAPITAL PARTNERS

GP FOCUSED SECONDARY SOLUTIONS

e Print-outs of Mr. Cohn’s LinkedIn profile, listing Mr. Cohn’s post-Fort

Washington employment as “Managing Partner” at “Investor.” Cd.,

PAGEID # 378-88.)

Mr. Cohn appealed to Western & Southern’s Executive Committee on August

15, 2019. (See id., PAGEID # 393.) He argued that he was not, in fact, working for a

competitor:

Mr. Cohn has been unemployed since leaving [Fort Washington]. Mr.

Cohn has considered the creation of a private equity fund through the

entity he created, “Tail End Capital Partners” but Tail End has not

generated any revenue at this time. In fact, Mr. Cohn has had no

employment income since he left [Western & Southern]. . . . [S]ince

leaving [Fort Washington], Mr. Cohn has taken great efforts to treat

[Fort Washington] fairly. Mr. Cohn has not taken any action to take

either investors or deals from [Fort Washington]. In fact, Mr. Cohn has

not reached out to any of the [Fort Washington] investors or the

“gatekeeper” or consulting community where [Fort Washington]

markets its funds. Mr. Cohn’s activities also have not impacted any

deal flow for [Fort Washington]. Further, Mr. Cohn has not solicited

any employees from [Fort Washington] and has not engaged in any

disparagement of [Fort Washington] in the marketplace.

(Id., PAGEID # 396.)

The Executive Committee was unconvinced. (See id., PAGEID # 457.) In its

October 7, 2019 determination, the Executive Committee found “that Mr. Cohn

entered into a business which is both competitive with and similar to the business

of” Fort Washington. (Id., PAGEID # 458.) The Executive Committee noted “that

according to the Tail End Capital Partners’ website, Tail End Capital Partners is an

investment management firm involved in private equity.” (Id., PAGEID # 459.) In

concluding that Tail End Capital Partners was “competitive with and similar to the

business of Fort Washington,” the Executive Committee “d[id] not find it relevant as

to whether Tail End Capital Partners ha[d] generated revenue at [that] time.” (Id.)

The Executive Committee concluded that, pursuant to the Plan, Mr. Cohn’s

Performance Unit Account balance was forfeited and benefits paid out of the Plan

were required to be returned. (Id.)

D. Mr. Cohn files suit under ERISA.

Shortly after receiving the Executive Committee’s decision, Mr. Cohn filed

this action under Section 502 of the Employee Retirement Income Security Act of

1974 (“ERISA”) [29 U.S.C. § 1132]. (See ECF No. 1. See also Am. Compl., ¶ 4.) The

operative Complaint asserts two counts. (See Am. Compl.) In Count One, Mr. Cohn

alleges that he was deprived of a full and fair review of the initial benefit

determination, as required under ERISA § 503 [29 U.S.C. § 1133] and 29 C.F.R.

2560.503-1(h)(2). (Id., ¶¶ 53–56.) In Count Two, Mr. Cohn challenges the denial of

benefits under the Plan. (Id., ¶¶ 57–66.)

E. Relevant Plan Terms

The Administrative Record includes three amended and restated Plan

documents, seven snap-on amendments, and two Summary Plan Descriptions. (See

Admin. R. Pt. 1; Admin. R. Pt. 2.) Though neither party raises it as a concern, there

is reason to suspect that the Record is incomplete.2 All three restatements suggest

that the Plan was established prior to 2005, but the oldest restatement in the

Record was signed on October 31, 2008. (2008 Restatement, PAGEID # 335.) The

Record also includes a restatement dated April 30, 2010 (2010 Restatement,

PAGEID # 313) and another dated May 21, 2014 (2014 Restatement, PAGEID #

281). Crucially, the Plan document in effect as of Mr. Cohn’s first three Performance

2 The parties litigated a different issue related to the disclosure of documents.

Ultimately, this Court ordered Defendants to produce certain documents, which

now comprise Admin. R. Pt. 2. (See ECF Nos. 17, 20.)

Unit awards (July 24, 2006, March 1, 2007, and March 1, 2008) is missing, as is Mr.

Cohn’s written distribution election. (See Admin. R. Pt. 1, PAGEID # 265.)

The 2008 Restatement, 2010 Restatement, and 2014 Restatement differ in

important ways. But, for the sake of providing context and background, the 2014

Restatement provides in relevant part as follows:

PURPOSE

The Western & Southern Financial Group Long Term Incentive and

Retention Plan I (“Plan”) is designed to provide an incentive for

selected key employees of the Western & Southern Financial Group to

maximize performance and remain with the organization, and to

enable the Western & Southern Financial Group to attract well-

qualified candidates. This is an amended and restated plan. The Plan

shall at all times be administered and interpreted in such a manner as

to constitute an unfunded nonqualified deferred compensation

arrangement for tax purposes and for purposes of Title I of ERISA.

This Plan is intended to comply with and shall be interpreted in

accordance with Section 409A of the Internal Revenue Code and

official guidance issued thereunder.

* * *

2.1 Eligibility. Each Employee whose annual Compensation is in the

top five percent (5%) for all Employees as of the end of the prior

calendar year shall be eligible to be considered for participation in the

Plan.

* * *

4.7 Forfeitures. The contingent right of a Participant or Beneficiary

to receive future payments hereunder and to maintain those benefits

paid under the Plan with respect to both vested and nonvested

Performance Units shall be forfeited, and, in the case of benefits

payable or paid, shall be subject to cancellation, recoupment,

rescission, payback or other action to be taken by the Company, upon

the occurrence of any one or more of the following events:

(a) If the Participant is involuntarily terminated from employment

for Cause by the Company or any Affiliate; or

(b) If the Participant, as of the later of, (1) within three years after

termination of employment with the Company or any Affiliate, or

(2) on or before the completion of distributions with respect to the

vested Performance Units in his Account, (x) enters into a business

or employment which is competitive with or similar to the business

of the Company or any Affiliate, (y) solicits the Company’s or any

Affiliates’ employees, agents or clients to work for or buy products

from, or (z) acts in any other way which, had the Participant been

employed with the Company or any Affiliate, would have provided

the Company with “Cause” to terminate such Participant’s

employment.

However, the Executive Committee may, in its sole discretion, waive or

reduce the forfeiture of payments described above.

Each Participant expressly consents to the Company’s application,

implementation, and enforcement of this Section 4.7, and expressly

agrees that the Company may take such actions as are necessary to

effectuate the provisions of this Section 4.7 without further consent or

action being required by the Participant.

In addition to the above provisions, nonvested Performance Units shall

be forfeited upon a Participant’s voluntary termination of employment

or for any non-Cause termination.

Performance Units related to forfeited payments shall remain in the

Plan and may be awarded by the Executive Committee to other

Participants at a later time.

* * *

ARTICLE V

AMENDMENT AND TERMINATION

The Company reserves the right at any time and from time to time, to

terminate or amend this Plan in writing. However, any termination or

amendment shall not alter a Participant’s right to Performance Units

that were awarded prior to such action as provided by the terms of the

Plan prior to such termination or amendment.

* * *

6.3 Powers. The Executive Committee or such other department or

committee of the Company as the Executive Committee shall designate

shall have the discretionary authority to determine eligibility for

benefits and to construe the terms of the Plan. Benefits under this

Plan shall be paid only if the Executive Committee or its designee

decides in its discretion that the applicant is entitled to them under

the terms of this Plan. The Executive Committee or such designee

shall have such other discretionary authority and powers as may be

necessary to enable it to discharge its duties and responsibilities under

the Plan, including, but not limited to the power:

(a) to interpret and construe the Plan, including but not limited to

the power to determine all questions with regard to employment,

eligibility, service, earnings, coverage, benefits, and such factual

matters as date of birth and marital status, and similarly related

matters for the purpose of the Plan, and the Executive Committee’s

or its designee’s determination of all questions arising under the

Plan shall be conclusive upon all persons, the Employer and other

interested parties;

(b) to review appeals by Participants from a denial of benefits;

(c) to adopt such rules as it deems appropriate for the

administration of the Plan;

(d) to prescribe procedures to be followed by Participants and

Beneficiaries filing applications for benefits;

(e) to request from the Employer, Participants and Beneficiaries

such information as shall be necessary for proper administration of

the Plan;

(f) to prepare and distribute to Participants information explaining

the Plan; and

(g) to appoint or employ any advisors to assist in the administration

of the Plan, including all the duties described in this Section, and

any other agents it deems advisable, including legal, accounting

and actuarial counsel.

The decision of the Executive Committee, its designee and the Benefits

Department upon any matter within its or their authority shall be

final and binding on all parties, including, but not limited to, the

Company, Participants, and Beneficiaries.

(2014 Restatement, PAGEID # 281–306.)

II. STANDARD OF REVIEW

ERISA benefit determinations are reviewed by the courts under a de novo

standard—unless the plan expressly grants its administrator or fiduciary

discretionary authority “to determine eligibility for benefits or to construe the terms

of the plan.” Firestone Tire and Rubber Co. v. Bruch, 489 U.S. 101, 115 (1989). See

also Yaeger v. Reliance Std. Life Ins. Co., 88 F.3d 376, 380 (6th Cir. 1996). If a plan

grants discretionary authority, “application of the highly deferential arbitrary and

capricious standard of review is appropriate[.]” Yaeger, 88 F.3d at 380.

Though the parties agree that the Plan grants the Executive Committee

discretionary authority, they dispute the applicable standard of judicial review. Mr.

Cohn argues that Firestone does not apply to top hat plans, and the Court should

proceed with a de novo review. (See Pl.’s Mot., 13–15.) He cites Goldstein v. Johnson

& Johnson, 251 F.3d 433 (3d Cir. 2001) for support. Noting that an analogy to trust

law provided Firestone’s justification for affording deference to a plan

administrator’s discretionary decisions, the Goldstein court concluded that

Firestone was “inapplicable” to top hat plans because those plans are more akin to

unilateral contracts than to trusts. Id. at 442–443. As Mr. Cohn notes, the Sixth

Circuit has not expressly addressed the issue. But this Court has concluded that

Firestone applies “even if” the plan is a top hat plan. Whitescarver v. Sabin Robbins

Paper Co., No. C-1-03-911, 2005 WL 8168487, at *4 (S.D. Ohio Apr. 28, 2005) (Dlott,

J.) (finding Goldstein “to be faulty because it cannot be reconciled with . . . key

provisions” of the Firestone decision).3 The Court sees no reason to alter its prior

conclusion.

“A decision reviewed according to the arbitrary and capricious standard must

be upheld if it results from ‘a deliberate principled reasoning process’ and is

supported by ‘substantial evidence.’” Schwalm v. Guardian Life Ins. Co. of Am., 626

F.3d 299, 308 (6th Cir. 2010) (quoting Baker v. United Mine Workers of Am. Health

& Ret. Funds, 929 F.2d 1140, 1144 (6th Cir. 1991)). Judicial review is no “rubber

stamp”—rather the court examines the “quantity and quality of the . . . evidence on

each side.” Id. (citing Evans v. UnumProvident Corp., 434 F.3d 866, 876 (6th Cir.

2006). “[T]hough the [arbitrary and capricious] standard is not without some teeth,

it is not all teeth.” McClain v. Eaton Corp. Disability Plan, 740 F.3d 1049, 1064 (6th

Cir. 2014). “[I]ndications of arbitrary and capricious decisions include a lack of

substantial evidence, a mistake of law, bad faith and a conflict of interest by the

decision-maker.” Zenadocchio v. BAE Sys. Unfunded Welfare Ben. Plan, 936 F.

Supp. 2d 868, 884 (S.D. Ohio 2013) (Rose, J.) (citing Caldwell v. Life Ins. Co. of N.

Am., 287 F.3d 1276, 1282 (10th Cir. 2002)). However, “[w]hen it is possible to offer a

reasoned explanation, based on the evidence, for a particular outcome, that outcome

3 Although Whitescarver was affirmed, the Sixth Circuit expressly declined to

take up the question of whether “an ERISA top hat plan must be reviewed under a

de novo standard.” Whitescarver v. Sabin Robbins Paper Co., 313 F. App’x 781, 787

(6th Cir. 2008). Of note, the same language that gave the Court of Appeals comfort

in applying an arbitrary and capricious standard in Whitescarver is also present

here. See id. at 786–87 (“Where the Plan . . . describes the interpretation reached by

the employer/administrator to be ‘binding and conclusive,’ we can only conclude that

the plan meaning is to vest the type of discretion in the Plan Administrator that

must be reviewed under an arbitrary and capricious standard.”).

is not arbitrary or capricious.” Shields v. Reader’s Digest Ass’n, Inc., 331 F.3d 536,

541 (6th Cir. 2003) (quoting Davis v. Kentucky Fin. Cos. Ret. Plan, 887 F.2d 689,

693 (6th Cir. 1989)).

III. ANALYSIS

A. Count One – Full and Fair Review

As a threshold matter, Mr. Cohn’s briefing neither mentions nor argues for

any relief on Count One. (See generally ECF Nos. 24, 26, 31.) Accordingly, the Court

considers the claim abandoned. Cf. Chic Promotions, Inc. v. Jewelers Mut. Ins. Co.,

No. 1:07cv417, 2009 WL 3126454, at *2 (S.D. Ohio Sept. 24, 2009) (Barrett, J.)

(collecting cases).

B. Count Two – Benefit Denial

As to Count Two, Mr. Cohn argues that the benefit determination requires

review as to (i) the forfeiture of Units still in the Plan and (ii) the recoupment of

benefits already paid out of the Plan. The Executive Committee relied on Plan § 4.7

in reaching its conclusion on both forfeiture and recoupment. Mr. Cohn challenges

the Executive Committee’s interpretation of the Plan’s terms as to each.

It is “a fundamental principle of ERISA law—the plain language of the plan

controls.” West v. AK Steel Corp. Retirement Accumulation Pension Plan, 318 F.

Supp. 2d 579, 585 (S.D. Ohio 2004) (Beckwith, J.) (citation omitted). Accordingly,

the Court’s “starting point is the language of the Plan itself.” Farhner v. United

Transp. Union Discipline Income Prot. Program, 645 F.3d 338, 343 (6th Cir. 2011)

The 2008 Restatement and 2010 Restatement both include the following

language at § 4.7:

4.7 Forfeitures. The contingent right of a Participant or Beneficiary

to receive future payments hereunder with respect to both vested and

nonvested Performance Units shall be forfeited upon the occurrence of

any one or more of the following events:

(a) If the Participant is involuntarily terminated from

employment for Cause by the Company or any Affiliate; or

(b) If the Participant within three years after termination of

employment with the Company or any Affiliate (1) enters into a

business or employment which is competitive with the business

of the Company or any Affiliate, (2) solicits the Company’s or

any Affiliates’ employees, agents or clients to work for or buy

products from, or (3) acts in any other way which, had the

Participant been employed with the Company or any Affiliate,

would have provided the Company with “Cause” to terminate

such Participant’s employment.

However, the Executive Committee may, in its sole discretion, waive or

reduce the forfeiture of payments described above.

In addition to the above provisions, nonvested Performance Units shall

be forfeited upon a Participant’s voluntary termination of employment

or for any non-Cause termination.

Performance Units related to forfeited payments shall remain in the

Plan and may be awarded by the Executive Committee to other

Participants at a later time.

(Admin. R. Pt. 1, PAGEID # 324–25, 346.) An Amendment to the Plan revised

§ 4.7(b), effective January 1, 2014, to read as follows:

(b) If the Participant, as of the later of, (1) within three years after

termination of employment with the Company or any Affiliate, or

(2) on or before the completion of distributions with respect to the

vested Performance Units in his Account, (x) enters into a business or

employment which is competitive with the business of the Company or

any Affiliate, (y) solicits the Company’s or any Affiliates’ employees,

agents or clients to work for or buy products from, or (z) acts in any

other way which, had the Participant been employed with the

Company or any Affiliate, would have provided the Company with

“Cause” to terminate such Participant’s employment.

(Id., PAGE ID # 307.) Finally, the 2014 Restatement provides:

4.7 Forfeitures. The contingent right of a Participant or Beneficiary

to receive future payments hereunder and to maintain those benefits

paid under the Plan with respect to both vested and nonvested

Performance Units shall be forfeited, and, in the case of benefits

payable or paid, shall be subject to cancellation, recoupment,

rescission, payback or other action to be taken by the Company, upon

the occurrence of any one or more of the following events:

(a) If the Participant is involuntarily terminated from

employment for Cause by the Company or any Affiliate; or

(b) If the Participant, as of the later of, (1) within three years

after termination of employment with the Company or any

Affiliate, or (2) on or before the completion of distributions with

respect to the vested Performance Units in his Account,

(x) enters into a business or employment which is competitive

with or similar to the business of the Company or any Affiliate,

(y) solicits the Company’s or any Affiliates’ employees, agents or

clients to work for or buy products from, or (z) acts in any other

way which, had the Participant been employed with the

Company or any Affiliate, would have provided the Company

with “Cause” to terminate such Participant’s employment.

However, the Executive Committee may, in its sole discretion, waive or

reduce the forfeiture of payments described above.

Each Participant expressly consents to the Company’s application,

implementation, and enforcement of this Section 4.7, and expressly

agrees that the Company may take such actions as are necessary to

effectuate the provisions of this Section 4.7 without further consent or

action being required by the Participant.

In addition to the above provisions, nonvested Performance Units shall

be forfeited upon a Participant’s voluntary termination of employment

or for any non-Cause termination.

Performance Units related to forfeited payments shall remain in the

Plan and may be awarded by the Executive Committee to other

Participants at a later time.

(Id., PAGEID # 294–95.)

All three Restatements expressly state:

[Western & Southern] reserves the right at any time and from time to

time, to terminate or amend this Plan in writing. However, any

termination or amendment shall not alter a Participant’s right to

Performance Units that were awarded prior to such action as provided

by the terms of the Plan prior to such termination or amendment.

(Id., PAGEID # 297, 326, 348.)

1. The forfeiture decision was not arbitrary or capricious.

Mr. Cohn first challenges the forfeiture of his Performance Unit Account

balance. Based upon the evidence—namely, the RIVVER website, Mr. Cohn’s

LinkedIn profile, and the corporate filings for Tail End Managing Member I—the

Western & Southern benefits department, and later the Executive Committee,

determined that Mr. Cohn entered into a competitive business within three years of

termination, triggering § 4.7. Though the precise language of the Plan changed over

time, it was always true that a participant risked forfeiture of future payments

related to vested and nonvested Performance Units if he “enter[ed] into a

business . . . which is competitive with” Western & Southern or any of its affiliates.

Here, the corporate filings support the Executive Committee’s conclusion that Mr.

Cohn “entered into a business.” And the Tail End Capital Partners logo, which

appears on the RIVVER site and states that the company provides “GP focused

secondary solutions,” supports the conclusion that the business was competitive

with Fort Washington’s. What’s more, the RIVVER site, which lists Mr. Cohn as

Managing Partner of Tail End Capital Partners, may be read as ‘filling in the blank’

left on Mr. Cohn’s LinkedIn profile, which lists him as Managing Partner of

“Investor.” It was reasonable for the Executive Committee to conclude that the

unnamed “Investor” was Tail End Capital Partners. Accordingly, the Court cannot

conclude that the Executive Committee’s decision to forfeit Mr. Cohn’s Performance

Unit Account balance was arbitrary and capricious.

Mr. Cohn argues for the opposite conclusion. Specifically, he asserts that the

Executive Committee’s decision to forfeit his Performance Unit Account balance was

arbitrary and capricious because (i) there is insufficient evidence supporting the

decision; (ii) the Executive Committee has a conflict of interest; and (iii) the

administrative claim process suffered from “procedural irregularities”. (Pl.’s Mot.)

a) Insufficient Evidence

Mr. Cohn first argues that the evidence in the Administrative Record does

not establish that he entered into a competitive or similar business. He notes that

dictionary definitions of “business” contemplate “the existence of commercial action

or activity for the purpose of monetary gain,” but that none of the evidence

establishes that Tail End Capital Partners was engaged in commercial activity. (Id.,

9.) He then defines “competition” and notes that Mr. Cohn

specifically disclaimed engaging in any competitive activity. He

advised [Western & Southern] that he was unemployed, had not

generated any employment income or business revenue, had not

solicited investors or attempted to take any [Fort Washington] deals,

had not spoken to [Fort Washington] investors or other clients where

[Fort Washington] markets its funds, nor had he solicited any [Fort

Washington] employees to leave employment or disparaged [Fort

Washington] or [Western & Southern] in any way.

(Id., 10.) At most, he argues, the evidence establishes that Mr. Cohn was “preparing

to compete,” which is not prohibited under the Plan. (Id., 11.)

Mr. Cohn’s interpretation of the Plan is cogent and rational. But “equally

rational interpretations of a disputed [plan] term . . . [are] insufficient to show that

the plan administrator acted arbitrarily or capriciously[.]” Cultrona v. Nationwide

Life Ins. Co., 748 F.3d 698, 705 (6th Cir. 2014) (citing Morgan v. SKF USA, Inc., 385

F.3d 989, 992 (6th Cir. 2004)) (internal quotation marks omitted). Instead, courts

“are required to resolve a tie in favor of the [p]lan administrator.” Id. at 705–06. Cf.

Javery v. Lucent Tech., Inc. Long Term Disability Plan, 741 F.3d 686, 700–701 (6th

Cir. 2014) (citing Tracy v. Pharmacia & Upjohn Absence Payment Plan, 195 F.

App’x 511, 516 n.4 (6th Cir. 2006)) (noting that the plaintiff bears the burden of

proof in an ERISA case).

b) Conflict of interest

Mr. Cohn next argues that the Plan’s administration and governance

structure warrants an inference that the Executive Committee’s decision was

arbitrary and capricious. (Pl.’s Mot., 16–17.) He asserts that Western & Southern

both administers the Plan and pays Plan benefits; that Plan forfeitures “ha[ve] led

to significant cost savings for” Western & Southern; and that members of the

Executive Committee have participated or do participate in the Plan. (Id.) But Mr.

Cohn offers no evidence that the Executive Committee was actually affected by any

conflict. See Judge v. Metro. Life Ins. Co., 710 F.3d 651, 664 (6th Cir. 2013) (quoting

DeLisle v. Sun Life Assurance Co. of Canada, 558 F.3d 440, 445 (6th Cir. 2009)

(“[T]his court has given greater weight to the conflict-of-interest factor when the

claimant ‘offers more than conclusory allegations of bias.’”). Accordingly, the Court

declines to give the conflict significant weight in its determination.

c) Procedural Irregularities

Finally, Mr. Cohn argues that the process engaged in by the Western &

Southern benefits department and Executive Committee was so flawed as to

undermine their decision to forfeit his remaining Performance Units. (Pl.’s Mot.,

17–18.) In Mr. Cohn’s view, these “procedural irregularities” evidence a pretextual

determination procedure—in other words, that Western & Southern “had a

preconceived result in mind when it sent the [May 31, 2019 letter] and that no

information [Mr.] Cohn provided could change its mind thereafter.” (Id., 18.) The

argument is unavailing.

Mr. Cohn first asserts that the initial investigation into his involvement with

Tail End Capital Partners was inadequate. He complains that the investigation

took only three days, and that the corpus of evidence “hardly changed over time.”

(Id., 17.) Mr. Cohn cites no authority for the notion that these facts are problematic,

and the Court does not view them as such.

Second, Mr. Cohn notes that Western & Southern refused to produce

documents relevant to his benefit denial, as required under ERISA. (Id.) Though

this Court compelled production of the documents in question (see ECF Nos. 17, 20),

Mr. Cohn does not identify how the delayed receipt of those documents prejudiced

him or otherwise relates to the substantive decision that he forfeit his Performance

Unit Account. Cf. Lake v. Metro. Life Ins. Co., 73 F.3d 1372, 1378 (6th Cir. 1996)

(noting that “violations of the procedural sections of ERISA do not give rise to

claims for substantive damages”) (citation omitted).

Third, Mr. Cohn alleges that Western & Southern failed to adequately

document the basis for their decision. (Pl.’s Mot., 18.) He focuses on the fact that

relevant excerpts from the Tail End Capital Partners website (referenced by the

Executive Committee) were not included in the Administrative Record. Any such

failure is harmless error. Even without excerpts from the website, the evidence in

the Administrative Record is sufficient to uphold the Executive Committee’s

decision.

Fourth, Mr. Cohn argues that the Executive Committee “ignored evidence

and explanations offered” in his appeal. (Id.) But the Executive Committee’s

October 7, 2019 letter belies the assertion. There, the Executive Committee states

that it “considered all of your arguments in favor of allowing Mr. Cohn to maintain

[Plan] benefits both awarded and paid to him” and “reviewed all points made on

behalf of Mr. Cohn in your August 15, 2019 [appeal] letter.” (Admin. R. Pt. 1.,

PAGEID # 457.)

Finally, Mr. Cohn accuses Western & Southern of “lawyering up.” (Pl.’s Mot.,

18.) He bemoans:

[Western & Southern] heavily relied on lawyers to make the

administrative decision concerning Cohn’s benefits, almost completely

taking the decision out of the administrator’s hands and making the

decision one for the law department. [Western & Southern]

strategically used attorneys and the attorney-client privilege

so its administrative decision-making could be shielded from

review.

(Id.) (internal citation omitted) (emphasis in original). Benefit plans are legal

documents—governed by a comprehensive system of laws and regulations—which

enshrine legal rights and establish legal obligations. The Court draws no adverse

inference from Western & Southern consulting their lawyers in determining its

approach to Mr. Cohn’s Plan benefits.

Whether viewed individually or as a whole, the purported irregularities do

not give the Court reason to question that the decision to forfeit Mr. Cohn’s

Performance Unit Account balance was the result of a deliberate, principled

reasoning process.

2. The recoupment decision was arbitrary and capricious as

to Performance Units awarded before the 2014

Restatement.

Mr. Cohn next challenges Western & Southern’s attempt to recoup Plan

benefits that had already been distributed to him. The parties principally argue

whether Western & Southern has a legal mechanism for effectuating the

recoupment. But they put the cart before the horse. Before determining how to

recoup distributed benefits, they should have determined whether or not they could.

The 2014 Restatement very clearly authorizes recoupment of distributed Plan

benefits, and makes Performance Unit awards subject to those efforts. But before

the 2014 Restatement was signed, § 4.7 applied only to the “the contingent right . . .

to receive future payments[.]” Pursuant to Article V of the Plan, Performance Units

awards could not be further encumbered by later changes to the Plan. In other

words, neither the Western & Southern benefits department nor the Executive

Committee had authority under the Plan to demand recoupment of any benefit

payments attributable to Performance Units awarded to Mr. Cohn before May 21,

2014. Doing so was arbitrary and capricious. See Univ. Hosps. Of Cleveland v.

Emerson Elec. Co., 202 F.3d 839, 849 (6th Cir. 2000) (finding, “[u]pon reviewing the

plain language of the [p]lan,” that the plan administrator had “exceeded its power to

interpret the [p]lan and instead ha[d] effectively rewritten it”).

C. Finding and Remand

In view of the above, the Court finds that the Executive Committee’s decision

to forfeit Mr. Cohn’s Performance Unit Account balance was not arbitrary and

capricious, but that its decision to demand recoupment of benefits attributable to

Performance Units awarded prior to May 21, 2014 cannot stand. “In cases such as

these, courts may either award benefits to the claimant or remand to the plan

administrator.” Elliott v. Met. Life Ins. Co., 473 F.3d 613, 621 (6th Cir. 2006).

Remand is appropriate for “further fact-finding to supplement what [is found to be]

an incomplete record.” Javery, 741 F.3d at 700. It is inappropriate, however, to

“afford[ ] the plan administrator a chance to correct its reasoning for rejecting

[p]laintiff’s application.” Id.

The Administrative Record is unclear as to whether Mr. Cohn’s distributions

from the Plan were attributable to Performance Units awarded before or after the

2014 Restatement was signed. Accordingly, further fact finding is necessary and

remand is appropriate.

IV. CONCLUSION

For the reasons set forth above, Mr. Cohn’s Motion for Judgment on the

Administrative Record (ECF No. 24) is GRANTED IN PART and DENIED IN

PART and Defendants’ Motion for Judgment on the Administrative Record (ECF

No. 25) is GRANTED IN PART and DENIED IN PART. The matter is

REMANDED to the Executive Committee for further proceedings consistent with

this Opinion and Order. The Executive Committee is further ORDERED to make

such determination within 90 days of the date of this Opinion and Order. The

Clerk is DIRECTED to TERMINATE this case from the docket records of the

United States District Court for the Southern District of Ohio.

IT IS SO ORDERED.

/s/ Sarah D. Morrison

SARAH D. MORRISON

UNITED STATES DISTRICT JUDGE