UNPUBLISHED

UNITED STATES COURT OF APPEALS

FOR THE FOURTH CIRCUIT

ELIZABETH A. EDMONDS,
Plaintiff-Appellant,

v.
                                                                        No. 97-1431
HUGHES AIRCRAFT COMPANY;
HARTFORD LIFE & ACCIDENT
INSURANCE COMPANY,
Defendants-Appellees.

Appeal from the United States District Court
for the Eastern District of Virginia, at Alexandria.
Robert E. Payne, District Judge.
(CA-96-1368-A)

Argued: December 1, 1997

Decided: May 8, 1998

Before WILKINS, NIEMEYER, and MICHAEL, Circuit Judges.

_________________________________________________________________

Affirmed in part, reversed in part, and remanded with instructions by
unpublished per curiam opinion. Judge Niemeyer wrote a dissenting
opinion.

_________________________________________________________________

COUNSEL

ARGUED: Jon Michael Lippard, JON M. LIPPARD, P.C., Alexan-
dria, Virginia, for Appellant. Alfred Francis Belcuore, II, MONTE-
DONICO, HAMILTON & ALTMAN, P.C., Washington, D.C., for
Appellees.

_________________________________________________________________
Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).

_________________________________________________________________

OPINION

PER CURIAM:

Elizabeth Edmonds appeals a summary judgment entered for the
defendants, Hughes Aircraft Company (Hughes) and Hartford Life
and Accident Company (Hartford), in Edmonds' suit challenging the
denial of disability benefits under an ERISA1 welfare benefit plan.
We affirm in part, reverse in part, and remand with instructions to
award benefits to Edmonds.

I.

Elizabeth Edmonds was an executive secretary for Hughes for fif-
teen years. For all of her life, she has suffered from minor depression,
and she has been treated for it for several years. Until the period at
issue here, her depression had not prevented her from performing her
usual duties for Hughes.

In mid-1993 Edmonds' mother became gravely ill, and, more or
less simultaneously, she was assigned a new supervisor at work.
According to Edmonds, her new supervisor was not sympathetic to
her need for occasional time off to care for her mother. The supervi-
sor yelled at and often humiliated her.2 Edmonds' depression grew
steadily worse. Her mother died, and the abuse at work continued. By
July 1994 she could take it no longer, and she stopped working. Her
treating psychiatrist, Dr. Barry Gorman, and her counselor, Catherine
Thomsen,3 agreed that her depression precluded her from continuing
her current work.
_________________________________________________________________
1 Employee Retirement Income Security Act, 29 U.S.C. §§ 1001 et seq.
2 If Edmonds' account be true, the supervisor's comments reached a
shocking level of cruelty. For example, after Edmonds returned from an
absence to care for her mother, the supervisor said,"maybe after the next
stroke, she'll roll over and die."
3 Ms. Thomsen is a licensed clinical social worker.

                    2
Edmonds filed a claim for disability benefits under two welfare
benefit plans maintained by Hughes. The plans provide for short-term
disability benefits (STD) for a maximum of 180 days and long-term
disability benefits (LTD) for up to 24 months.4 Hughes is nominally
the administrator of both plans, but all discretion usually resident in
the administrator is vested in Hartford. Hartford's possession of this
discretion causes it to be a fiduciary of the plans. 29 U.S.C.
§ 1002(21)(A)(i), (iii). Though the documents in the joint appendix do
not reveal details of the financial arrangement between Hartford and
Hughes, their counsel conceded at oral argument that Hartford was
not paid merely a fee for administrative services; instead, Hughes
paid a premium to Hartford to both administer the plans and to cover
benefit payments.

There are some minor differences between the plans, but none of
relevance here. Both grant Hartford the "full discretion and authority
to determine eligibility for benefits and to construe and interpret all
terms and conditions" of the Hartford policy that funds each plan.
Each covers disability caused by mental illness of the type alleged by
Edmonds, and both define "total disability" as occupational disability,
that is, the inability to perform one's customary job, rather than the
inability to perform any job. See DeWitt v. State Farm Insurance
Companies Retirement Plan, 905 F.2d 798, 802 (4th Cir. 1990).

Based on information it received from Dr. Gorman and Ms. Thom-
sen, Hartford approved STD benefits for Edmonds for the entire 180
days authorized by the STD plan.5 Meanwhile, it began to process
Edmonds' LTD claim.

In a "request for nursing review" dated October 18, 1994, a Hart-
ford employee stated, "In an effort to deter[Edmonds] from LTD, I
believe this situation can possibly result in a joint effort (over!)."
Unfortunately, the other side of the page is not in the record, so we
cannot with certainty identify the parties to the"joint effort" to deter
Edmonds or the particular efforts proposed.
_________________________________________________________________
4 The 24-month period applies to mental illness only. Employees dis-
abled for other reasons may be eligible for benefits for a longer period.
5 Edmonds did not begin receiving actual cash benefits, however, until
her paid sick leave was exhausted on October 14, 1994.

                    3
On December 22, 1994, Wanda Dorgan of Hughes' legal depart-
ment contacted Sandy Lathe, a claims examiner at Hartford. She
informed Lathe that Edmonds had just sued Hughes for"disability
discrimination." Lathe told Dorgan that STD had been approved for
the full 180 days, but that Edmonds' claim for LTD was still being
evaluated. According to Edmonds, this conversation suggests that
Hughes was applying subtle (or not so subtle) pressure on Hartford
to deny the claim. Edmonds contends that this pressure succeeded.

As a matter of policy, neither Dr. Gorman nor Ms. Thomsen
releases private office notes. During the processing and approval of
Edmonds' STD claim, this policy had not posed a problem. Dr. Gor-
man and Ms. Thomsen responded to Hartford's inquiries, and their
responses had apparently been sufficient for Hartford to evaluate the
claim. On February 9, 1995, Sandy Lathe discussed Edmonds' LTD
claim with someone identified only as "Cathy." Lathe's notes state
that "[n]either of Ms. Edmonds['] doctors will release office notes to
review the patient[']s condition. However, they have answered the
questions we've posed." Lathe and Cathy discussed the situation and
concluded that Hartford did not have enough information to make a
decision. Consequently, they decided to obtain an"independent medi-
cal examination" of Edmonds.

Hartford had Comprehensive Rehabilitation Associates (CRA), a
California firm, arrange for the independent medical examination.
CRA engaged Dr. Bruce Smoller of Fairfax, Virginia, for the task. As
instructed by Hartford, CRA asked Dr. Smoller to provide a "fair and
impartial narrative report addressing" these matters:

          1. The patient's pertinent medical history.

          2. Subjective symptoms reported by the patient.

          3. Objective findings found by the examiner.

          4. The examiner's diagnosis of the condition(s) which dis-
          able (or are claimed to disable) the patient.

          5. What are the patient's specific physical or psychiatric
          limitation(s)? Please be sure to itemize all limitations.

                    4
         6. What is the expected duration of these limitations?

         7. Do you agree with the patient's present course of treat-
         ment? What, if any, other treatment would you recom-
         mend and what would you expect to be the result of
         such treatment?

         8. Please limit your discussions to the medical limitations,
         not vocational limitations of the claimant.

Dr. Smoller interviewed Edmonds on March 16, 1995. According
to Edmonds, the interview lasted no more than forty-five minutes. In
a report dated March 16, 1995, but not stamped "received" by Hart-
ford until April 3, 1995, Dr. Smoller concluded:

         (1). Ms. Edmonds does suffer from some psychiatric
         symptoms of dysthymia, that is: a rather low-grade
         depression and dissatisfaction with life, symptoms of
         anxiety that have persisted throughout her life, a ten-
         dency to physicalize or somatize her stress (to present
         physical symptoms which are related to the stress).

         These are lifelong problems, unrelated in the main to
         any outside activity although she is probably hyper-
         sensitive to criticism.

         (2). These problems are unrelated to work activities. The
         stressors she describes at work seem not to be unduly
         discriminatory or unreasonable for a supervisory rela-
         tionship. This patient seems to have taken a great deal
         of time off of work and it would be reasonable for the
         supervisor to question such.

         (3). Although this patient does have longstanding psychi-
         atric problems, they are personality-based, have
         existed by the patient's own admission and by history,
         since childhood or early adolescence and are not
         related to current work-related activities.

                    5
         (4). This patient is not disabled by these conditions.
         Although she probably is in need of psychiatric treat-
         ment and medications, there is no clear indication of
         an inability to work. The problems she describes are
         in the administrative realm, not the medical, and
         should be resolved in that arena. On a psychiatric
         basis, Ms. Edmonds is not disabled from work and
         while it is commendable that she is seeking treatment,
         her symptoms do not prevent her from productive
         functioning.

         The patient has no specific physical or psychiatric
         limitations at the current time. It may be in everyone's
         best interest to transfer her to a different position at
         Hughes if this is possible but my suspicion is that she
         will find some problem with her next supervisor based
         on the hypersensitivity that she evidences in her per-
         sonality.

         5 Patient's present course of treatment is not unreasonable
         although it has gone on for seven years without terribly
         much change. Ms. Edmonds, however, has no medical or
         psychiatric limitations which would prevent her from func-
         tioning adequately in the positions for which she is trained.6

Lathe spoke to Edmonds by telephone on the day this report was
received by Hartford. She told Edmonds that she would be recom-
mending that the claim be denied based on Dr. Smoller's report.
Lathe's supervisor agreed, and written denial of the claim was mailed
to Edmonds on April 5. Simultaneously, Hartford sent a copy of Dr.
Smoller's report to Dr. Gorman for his comments.

Edmonds prepared an eight-page, handwritten response to Dr.
Smoller's report. Among other things, she asserted that (i) Dr. Smol-
ler had erroneously posited that the severity of her symptoms had not
changed through her lifetime, (ii) his opinion that she would "find
some problem with her next supervisor" was belied by her positive
_________________________________________________________________
6 The differences in this paragraph's format are discussed in Section III
below.

                    6
relationship with the majority of her twenty-one prior supervisors at
Hughes, and (iii) he had mentioned to her that he would provide his
findings to her lawyer, though she was not represented by counsel at
the time.7

But soon she was. On June 14, 1995, her lawyer formally appealed
the denial of LTD benefits, and, on July 6, 1995, he forwarded a
report by Edmonds' therapist Catherine Thomsen. Ms. Thomsen
recounted what she had observed during seven years of treating
Edmonds and the incidents that led up to Edmonds leaving work.
Thomsen continued:

          As time went on in 1993 and 1994, Mrs. Edmonds became
          increasingly despondent as the tension with her boss magni-
          fied in scope. She began to experience serious sleep distur-
          bances, sometimes not sleeping for days at a time. When she
          did sleep, her sleep was fitful and marked by frequent night-
          mares involving her stressful situation at work. I observed
          her becoming increasingly agitated and tearful, sometimes
          shaking uncontrollably.

* * *

        By the spring of 1994, Mrs. Edmonds was suffering from
        severe depression, fatigue and anxiety. She was unfocused,
        unable to concentrate, not sleeping, not eating and had with-
        drawn socially. I felt that she was clearly headed for a ner-
        vous breakdown if she did not stop working at the time. She
        remains unstable but is able to minimally function having
        been able to distance herself from the trauma she experi-
        enced with her manager. She feels very humiliated by these
        incidents at work and let down by her co-workers who were
        told to stay away from her. To this day when we discuss her
        returning, she becomes inconsolable.
_________________________________________________________________

7 Of course, she had a lawyer in her discrimination suit against Hughes,
but the "independent medical examination" was not commissioned for
use in that suit.

                    7
         With regard to Dr. Smoller's report, I agree that Mrs.
         Edmonds has had a life long history of depression. How-
         ever, it has never incapacitated her until this present situa-
         tion with her boss.... Mrs. Edmonds remains seriously
         depressed and[,] in my opinion, is not capable of returning
         to office work for an extended period of time.

On July 28, 1995, Dr. Gorman also offered a report supporting
Edmonds' claim. He explained that Edmonds had been referred to
him in 1992 by Ms. Thomsen when Edmonds' previous psychiatrist
had moved from the area. He recounted her long history of moderate
dysthymia and the abrupt worsening brought about by her mother's
terminal illness and her conflict with her new boss.

         As the result of these two stressors Ms. Edmonds demon-
         strated a much more significant degree of psychopathology.
         Her depression became significantly worse. She went from
         experiencing a Dysthymic Disorder to a Major Depressive
         Episode. Her depression was characterized by insomnia,
         hypersomnia, lethargy, a loss of interest and pleasure in pre-
         vious activities, tearfulness, anorexia, social withdrawal,
         suicidal ideation, difficulty facing the day and functioning,
         and frequently experiencing a sensation of being swallowed
         up by a black hole. Although she did not experience all of
         these symptoms all of the time, they are clearly characteris-
         tic of her affective experience over the past several years.

         Ms. Edmonds experienced an Anxiety Disorder analogous
         to Post-Traumatic Stress Disorder. Her symptoms were
         severely exacerbated by thoughts of work, discussion of
         work, or the need to attend her work environment. She expe-
         rienced tremendous apprehension, anxiety, dread, fearful-
         ness, and nightmares. She also had frequent remembrances
         of traumatic experiences with her boss.

Though Dr. Gorman clearly disagreed with Dr. Smoller, he expressed
this disagreement diplomatically:

         Ms. Edmonds was seen for a psychiatric examination by Dr.
         Smoller. He was placed in the difficult position of evaluat-

                   8
          ing a very complicated situation in a short amount of time
          with limited information. Mrs. Thomsen and I have had the
          experience of working with Ms. Edmonds over the past sev-
          eral years. We have been able to follow her course and
          understand the entire situation. She is a very troubled
          woman suffering from a number of co-morbid conditions
          and clearly unable to work at this time and most likely for
          an indefinite future period. She is functioning at a level of
          psychopathology much more severe and serious than prior
          to the death of her mother and her traumatic experience at
          work. I do not feel Dr. Smoller's report takes into consider-
          ation the severity and seriousness of her current situation, or
          the full impact of these stressors on her emotional state. Ms.
          Edmonds is currently unable to work. She has been disabled
          from working for at least the past two years. When and if
          she can return to meaningful employment cannot be deter-
          mined at this time.

After yet another request from Hartford, Edmonds was able to per-
suade Dr. Gorman to release his office notes. These were sent to Hart-
ford on September 21, 1995. On October 2, Hartford acknowledged
receipt of the notes and advised that they had been sent to "our medi-
cal department for review."

A "Claim Division Summary Report" dated October 11, 1995,
states that the medical staff "reviewed these records and have [sic]
found `there are no changes in [Edmonds'] chronic dysthemia [sic] to
support limitations and unable [sic] to do job. No evidence of any dis-
tinct change to produce symptoms of disabling nature.'" The docu-
ment from which these conclusions were apparently quoted is not in
the record. On October 18, 1995, Hartford denied the appeal based on
the assertion that Dr. Gorman's notes supported Dr. Smoller's view.
No explanation of this purported support was given.

Edmonds filed yet another appeal in November. She submitted
another report from Dr. Gorman. He flatly stated,"Elizabeth
Edmonds is currently disabled. She is unable to perform the material
and substantial duties of her regular occupation." He described her
symptoms and reiterated that they were trauma-induced and of greater

                    9
severity than her life long dysthymia. The charitable tone of his ear-
lier critique of Dr. Smoller's opinion was gone:

           The letter from ITT Hartford says that in order to qualify
          for benefits medical evidence substantiating total disability
          must be provided. I believe that medical evidence was pro-
          vided. Unfortunately this evidence was ignored and dis-
          torted by those who did the "concluding." The two people
          who know her the best, have worked with her the longest,
          and are most familiar with her psychological state, both feel
          that she is clearly disabled. I am referring to Mrs. Thomsen
          and myself. We are both respected and licensed clinicians.
          However, it appears that our assessment and recommenda-
          tions are being ignored.

           I feel Dr. Smoller's evaluation was inaccurate and biased.
          He could not accurately evaluate this complicated history
          and situation in one visit. It does not appear to me that he
          fully took into consideration the information provided by
          Mrs. Thomsen and myself.

Hartford promptly responded in a letter stating that"Dr. Gorman's
most recent report . . . does not offer the medical documentation
needed to render a different decision on this claim." However, Hart-
ford announced that it had decided to send "all available medical
records" to the "Medical Review Institute" for a "second opinion."8

The Medical Review Institute of America, Inc. (MRI) is a Utah-
based subsidiary of Medical Opinions, Inc. It provides opinions
"solely for the purpose of claims adjudication by[its] clients[.]"
Though an MRI opinion is prepared by a physician, the identity of the
preparer is not disclosed.

On December 27, 1995, MRI sent Hartford its report concerning
Edmonds. Here is the substantive portion of the one-page report:
_________________________________________________________________
8 Edmonds points out that the term"second opinion" implies that Hart-
ford was only counting one other, and that it takes little analysis to iden-
tify which one.

                    10
          All of the submitted records were reviewed. Based on the
          medical records provided, in my opinion, the patient is not
          disabled because of psychiatric reasons.

          I concur with statements made by Dr. [Smoller] in the psy-
          chiatric report dated 3/16/95 to the effect that,"there is no
          clear indication of an inability to work. The problems she
          describes are in the administrative realm, not the medical,
          and should be resolved in that arena."

          Also of significance in Dr. [Smoller's] report was the dis-
          cussion of the finding in an "MMPI" that was reportedly
          done, which noted that (the patient) "... may attempt to con-
          trol others by complaining of physical symptoms," and later
          noted, "she is likely to have a hysterical adjustment to life
          which under stress may produce or exacerbate symptom
          development leading to a pattern of invalidism."

Along with its opinion, MRI sent Hartford a bill for $472 and an
advertisement for a "new cost-saving service" involving review of
invoices from hospitals for DRG (diagnostic-related groups) services.
Interested insurers were directed to MRI's Marketing Department at
a toll-free number.

By letter dated January 6, 1996, Hartford again denied Edmonds'
claim. On February 13, 1996, Edmonds tried one last time. She filed
another appeal and submitted additional evidence: the determination
of the Social Security Administration that she was disabled from
returning to her past work (though not to all work) and the report of
Dr. Robert Altman, who had examined her on April 27, 1995, in con-
nection with her Social Security claim and had corroborated Dr. Gor-
man's diagnosis of major depression. Hartford reiterated its denial of
her claim on March 4, 1996.

This litigation followed. On September 25, 1996, Edmonds sued
Hughes and Hartford in district court. She sought enforcement of her
contractual right to LTD benefits and damages for breach of fiduciary
duty. After discovery the defendants moved for summary judgment.
A hearing was held on March 14, 1997, at which the district court
granted the motion from the bench.

                    11
Edmonds appeals.

II.

We review the grant of summary judgment de novo . Brogan v.
Holland, 105 F.3d 158, 161 (4th Cir. 1997). Review of an ERISA
plan administrator or fiduciary's decision is also de novo, except
where the plan grants the administrator or other fiduciary discretion
concerning the decision at issue. In the latter event, we review for
abuse of discretion. Firestone Tire & Rubber Co. v. Bruch, 489 U.S.
101 (1989). In an ordinary abuse of discretion case, we must affirm
the fiduciary's decision if it "`is the result of a deliberate, principled
reasoning process and . . . is supported by substantial evidence.'"
Brogan, 105 F.3d at 161 (quoting Bernstein v. CapitalCare, Inc., 70
F.3d 783, 788 (4th Cir. 1995)).

An ERISA fiduciary must act "solely in the interest of the partici-
pants and beneficiaries[.]" 29 U.S.C. § 1104(a)(1)(A). In exercising
any discretion granted by the plan, the fiduciary may take the interests
of all of the plan participants into account, one of which is to conserve
the plan's assets. Ellis v. Metropolitan Life Insurance Co., 126 F.3d
228, 234 (4th Cir. 1997). In an insurer-funded, insurer-fiduciary plan,
this legitimate consideration can be very difficult to distinguish from
the wholly illegitimate consideration of the insurer's own profits.
After all, once the premium is paid, the plan is"fully funded" in the
sense that the risk of unanticipated expenses is shifted from the plan's
sponsor and beneficiaries to the insurer. A fiduciary that bears such
a risk and simultaneously has the discretion to lessen it has a direct
conflict of interest.9

ERISA tolerates the existence of this conflict of interest, but it does
not tolerate any adverse consequence to plan beneficiaries. As we
noted earlier, the fiduciary must act solely in the interest of the plan's
participants and beneficiaries. Therefore, though we review all discre-
_________________________________________________________________
9 The record does not reveal whether Hartford has any power to recoup
unanticipated losses from Hughes through premium adjustments in sub-
sequent years or any absolute right to renewal in order to exercise such
a power. In any event, defendants' counsel conceded at argument that we
may assume that Hartford had a conflict of interest.

                     12
tionary decisions for abuse of that discretion, we subject decisions
made by fiduciaries with conflicts of interest to a"sliding scale" of
additional scrutiny.

          The more incentive for the administrator or fiduciary to ben-
          efit itself by a certain interpretation of benefit eligibility or
          other plan terms, the more objectively reasonable the admin-
          istrator or fiduciary's decision must be and the more sub-
          stantial the evidence must be to support it.

Ellis, 126 F.3d at 233. We must do this even though there may be no
evidence of a deliberate consideration of the fiduciary's self-interest,
and our decision in a given case that the fiduciary's discretion has
been abused does not necessarily imply that there was such deliberate
consideration.

          Even the most careful and sensitive fiduciary in those cir-
          cumstances may unconsciously favor its profit interest over
          the interests of the plan, leaving beneficiaries less protected
          than when the trustee acts without self-interest and solely
          for the benefit of the plan.

Doe v. Group Hospitalization & Medical Services , 3 F.3d 80, 86-87
(4th Cir. 1993).

We reiterate: because ERISA guarantees plan beneficiaries a fidu-
ciary who acts solely in their interests, a fiduciary laboring under a
conflict of interest "must act as if he is `free' of such a conflict."
Bedrick v. Travelers Insurance Co., 93 F.3d 149, 154 (4th Cir. 1996).
"`Free' is an absolute. There is no balancing of[the beneficiaries' and
either the fiduciary's or a third party's] interests; ERISA commands
undivided loyalty to the plan participants." Id.

If faithfully discharging such a duty appears especially arduous,
that is because it is. In general, Congress intended ERISA's fiduciary
responsibility provisions to be a codification of the common law of
trusts, Firestone, 489 U.S. at 110, and the duties of care and integrity
demanded of a fiduciary were among the highest, if not the very high-
est, known to the common law. Justice Cardozo provided their most
memorable description:

                     13
          Many forms of conduct permissible in a workaday world for
          those acting at arm's length, are forbidden to those bound by
          fiduciary ties. A trustee is held to something stricter than the
          morals of the market place. Not honesty alone, but the punc-
          tilio of an honor the most sensitive, is then the standard of
          behavior. As to this there has developed a tradition that is
          unbending and inveterate. Uncompromising rigidity has
          been the attitude of courts of equity when petitioned to
          undermine the rule of undivided loyalty by the "disintegrat-
          ing erosion" of particular exceptions. Only thus has the level
          of conduct for fiduciaries been kept at a level higher than
          that trodden by the crowd. It will not consciously be low-
          ered by any judgment of this court.

Meinhard v. Salmon, 249 N.Y. 458, 164 N.E. 545, 546 (1928) (cita-
tion omitted). We could not say it as well, but we are of like mind.
So, with these principles before us, we turn to the facts of this case.

III.

The first and most obvious thing one notices about the decision on
review is that it is discernibly against the weight of the evidence. We
think that most, if not nearly all, disinterested decisionmakers would
give greater weight to the opinions of two treating therapists of long
standing (neither of whom were hired in connection with the filing of
the claim) over the first impression of another expert, who had con-
ducted a single short interview and whose opinion belies perhaps too
great a familiarity with its intended purpose (see below).

The second and most disturbing thing one notices is that there are
a couple of things in the record one would not expect to see from a
fiduciary possessing "the punctilio of an honor the most sensitive[.]"

The first of these is the October 18, 1994, "request for nursing
review." A disinterested fiduciary evaluates claims as they come in
and lets the chips fall where they may. Planning to"deter" a benefi-
ciary from seeking benefits would not occur to such a fiduciary, let
alone proposing some sort of "joint effort" to effect the deterrence.

                    14
The other item of concern is the possible influence Hughes10 had
on Hartford's decision. It is just as violative of an ERISA fiduciary's
duties to further the interests of a third party as to further its own.11
Unlike the "request for nursing review," there is no smoking gun on
this point, but there is at least a cloud of suspicion. We do know that
Hughes' legal department informed Hartford of Edmonds' discrimi-
nation lawsuit, and we think that there was only the most marginal
legitimate reason for it to do so. In their brief Hughes and Hartford
assert that "this litigation, and the claims Ms. Edmonds made in it,
obviously were relevant to Ms. Edmonds' psychiatric disability[.]"
Brief of Appellees, at 43-44. It was "obviously relevant" in the broad-
est legal sense -- being party to a pending lawsuit is surely stressful
-- but one must doubt if this "relevant" purpose was the one for
which Hughes offered it.

The lining for this cloud of suspicion is supplied by Dr. Smoller's
report. First of all, its form seems odd. The report takes up four single
spaced pages, a few lines on a fifth page, and then a one-paragraph
addendum. Nearly all of the doctor's conclusions are on page four.
This page has a different header than the others, 12 and it and the
_________________________________________________________________
10 We speak here of Hughes as employer-defendant in Edmonds' dis-
crimination lawsuit, not of Hughes as plan fiduciary.
11 See Central States, Southeast and Southwest Areas Pension Fund v.
Central Transport, Inc., 472 U.S. 559, 571 n.12 (1985) (if goal of plan
trustees' audit request was to acquire information for third-party labor
union's use, ERISA's "standard of loyalty" would be violated).
12 Page 1 is unnumbered. Pages 2, 3, and 5 are all headed in this style:

          Re: Elizabeth Edmonds
          March 16, 1995
          Page [Two, Three, or Five]

page 4 has this header:

          RE: Elizabeth Edmonds
          Page Four

and the addendum has this one:

          ADDENDUM
          Page One
          RE: E. Edmonds.

                     15
addendum are printed in an different font than pages one, two, three,
and five. Paragraph five of Dr. Smoller's conclusions does not appear
on page four, and, as one can glean from our quotation of the conclu-
sions in Part I above, it is numbered and indented differently. A skep-
tic might suspect that the report as it appears in the record was not
prepared at one time and in one place.

The substance of the report also raises eyebrows. All of paragraph
two and parts of paragraphs three and four are devoted to minimizing
and justifying the severity of the stress experienced by Edmonds at
work and, in general, to breaking any causal link between Edmonds'
problems and her job. Indeed, Dr. Smoller went so far as to opine not
just that the pressure put on Edmonds by her supervisor was not "un-
reasonable," but also that it was not "discriminatory."

Of course, the LTD plan simply provides benefits for disability; the
beneficiary need not show that the disability is her employer's fault,
or anyone else's fault for that matter.13 One can search in vain through
the instructions CRA forwarded to Dr. Smoller from Hartford for any
request that the doctor give his opinion concerning the appropriate-
ness of Hughes' workplace from an employment relations standpoint.
His decision to render such an opinion at some length suggests the
presence of improper influence from Hughes.

Does MRI's report remedy these concerns? No. We wonder
whether a conflict-free ERISA fiduciary would even spend $472 of
the plan's money for a terse, conclusory opinion by a non-examining,
anonymous physician, let alone rely upon it over the opinions of treat-
ing physicians. There is no way to ascertain what particular informa-
tion the MRI report author considered -- beyond Dr. Smoller's
report, that is. The physician's anonymity makes assessment of his
credibility all but impossible; in fact, we must take MRI's word for
it that the report was even prepared by a physician. In any event, we
_________________________________________________________________
13 Moreover, even if the level of stress Edmonds experienced was not
"unreasonable" for some objective rugged individualist, it may well have
been devastating to a woman suffering from chronic depression and
simultaneously watching her mother die a slow death. Mental illness may
often be characterized by irrational, unreasonable affective responses to
day-to-day stress.

                    16
do know that MRI markets its expertise in assisting insurance compa-
nies in reducing liability payments.

Hartford labored under a conflict of interest in evaluating
Edmonds' claim. We are unable to assure ourselves that Hartford in
fact acted as if it were free of such a conflict, and we believe that a
rational fiduciary without a conflict would surely have awarded
Edmonds LTD benefits. We therefore hold that the denial of benefits
was an abuse of discretion.

IV.

Finally, we must address Edmonds' claim of breach of fiduciary
duty. While ERISA authorizes suits "by . . .[a] beneficiary . . . for
appropriate relief under § 1109 of this title[,]" 29 U.S.C. § 1132(a)(2),
and § 1109 is entitled "Liability for breach of fiduciary duty," such a
suit will only lie to remedy injuries to the plan as a whole rather than
to an individual beneficiary. Massachusetts Mutual Life Insurance
Co. v. Russell, 473 U.S. 134, 140-141 (1985). Edmonds' complaint
does not seek damages for the plan.

However, the Supreme Court has recognized that, under limited
circumstances, a beneficiary may sue for breach of fiduciary duty
under § 1132(a)(3) (authorizing suits for"appropriate equitable relief"
redressing or enjoining violations of the chapter). In Varity Corp. v.
Howe, 516 U.S. 489 (1996), the beneficiaries of a welfare benefit plan
were more or less duped by the plan's fiduciaries into giving up their
benefits. The Court held that reinstatement was"appropriate equitable
relief" to redress the breach of fiduciary duty.

The Varity Corp. Court was well aware that its holding could be
construed to provide an additional cause of action, as a matter of
course, to every beneficiary challenging a denial of benefits by his
plan's fiduciary. Consequently, it issued this caveat:

          [W]e should expect that where Congress elsewhere provided
          adequate relief for a beneficiary's injury, there will likely be
          no need for further equitable relief, in which case such relief
          normally would not be "appropriate."

                    17
516 U.S. at 515. Congress has provided Edmonds an action to recover
the benefits due her, § 1132(a)(1)(B), and, in the court's discretion,
for a reasonable attorney's fee and costs. § 1132(g). Congress gave no
more, however, "and we are not to give with the judicial hand what
Congress has failed to provide in legislation." Coyne & Delany Co.
v. Blue Cross & Blue Shield of Virginia, Inc., 102 F.3d 712, 716 (4th
Cir. 1996). Inasmuch as neither her complaint nor brief identifies any
defect in this relief severe or unusual enough to render an equitable
supplement "appropriate" in the limited sense intended by Congress,
Edmonds' § 1132(a)(3) claim must fail.

V.

The judgment of the district court on Edmonds' claim for breach
of fiduciary duty is affirmed, but judgment on her claim for benefits
due her under the plan is reversed. The case is remanded for calcula-
tion of damages due Edmonds and for the district court to exercise,
in the first instance, its discretion to award or deny costs and an attor-
ney's fee under 29 U.S.C. § 1132(g).

AFFIRMED IN PART, REVERSED IN PART,
AND REMANDED WITH INSTRUCTIONS

NIEMEYER, Circuit Judge, dissenting:

Elizabeth Edmonds, who suffers from depression, was awarded
short-term disability benefits under an employee welfare benefit plan
sponsored by her employer, Hughes Aircraft. The plan's administra-
tor, however, denied her long-term benefits based on conflicting
reports about the seriousness of the condition. This case challenges
the plan's decision.

The majority opinion, overtly sympathetic with Edmonds' condi-
tion, reverses the plan's decision and awards Edmonds benefits. I
believe that its approach in doing so failed properly to follow the dis-
cipline imposed by our standard of review in cases such as this one.

The only question in this case is whether Hughes Aircraft (and
Hartford, its insurer) abused its discretion in refusing to provide an

                     18
employee benefit to Edmonds as promised in the language of its
employee welfare benefit plan when the plan designates the benefit
as a matter within the plan administrator's discretion. In such matters
of contractually retained discretion, we must, as a matter of contrac-
tual interpretation, defer to the employer's discretion in determining
whether the benefit must be given. See Firestone Tire & Rubber Co.
v. Bruch, 489 U.S. 101, 111, 115 (1989); Sheppard & Enoch Pratt
Hosp. v. Travelers Ins. Co., 32 F.3d 120, 124 (4th Cir. 1994). The
majority opinion, I respectfully submit, misses this structural premise
and, instead, appears to convert the welfare benefit plan into a pre-
sumed entitlement governed by strict common law fiduciary stan-
dards.

It must be remembered that ERISA does not mandate employee
benefits of the type claimed by Edmonds. Rather, the statute provides
a structure for the administration of plans that are contractually pro-
vided. ERISA does mandate that in administering a plan, the plan
fiduciaries act solely in the interest of the participants and the benefi-
ciaries. See 29 U.S.C. § 1104(a)(1). But that requirement does not
prohibit an employer from retaining discretion in making judgment
calls about the benefits it has agreed to provide so long as that discre-
tion is expressed in the plan. Moreover, when such discretion is
retained by a fiduciary, the fiduciary's decisions are not subject to
review except for abuse of discretion. See Firestone, 489 U.S. at 111.
When reviewing for abuse of discretion, we do not disturb a fidu-
ciary's reasonable judgment "even if we come to a different conclu-
sion independently." Doe v. Group Hospitalization & Med. Servs., 3
F.3d 80, 85 (4th Cir. 1993). We determine only whether the plan con-
fers discretion on the fiduciary, whether the fiduciary acted within the
scope of the discretion, and whether the fiduciary's decision was
rational. See Haley v. Paul Revere Life Ins. Co. , 77 F.3d 84, 88-89
(4th Cir. 1996).

The majority opinion suggests that a conflict of interest might exist
in this case to reduce the deference contractually demanded. But there
is no evidence in the record to support this suggestion. At most, the
majority opinion notes that because Hughes Aircraft pays a premium
to Hartford to provide benefits and plan administration, they both
save money if a claim is denied. That, however, is true in every case
because benefits are not free. If the employer chooses to save yet

                     19
more money, it can withdraw the plan altogether. We have noted that
this general level of conflict is inherent in any employment plan struc-
ture, even though such a conflict might be intolerable for trustees at
common law. See Doe, 3 F.3d at 86. But such a generalized conflict
does not debilitate the deferential standard. Cf. id. at 87. Accordingly,
I conclude that we must review the employer's decision in this case
for abuse of discretion because the employer contractually reserved
such discretion.

The majority, while also reviewing the decision for abuse of discre-
tion, imposes an impossibly strict fiduciary standard that cannot ratio-
nally stand. Quoting from a New York Court of Appeals decision that
defines the common law standard for independent fiduciaries, the
majority adopts an absolute standard, rationalizing:"Uncompromising
rigidity has been the attitude of courts of equity when petitioned to
undermine the rule of undivided loyalty by the `disintegrating ero-
sion' of particular exceptions." Slip op. at 14 (quoting Meinhard v.
Salmon, 249 N.Y. 458, 164 N.E. 545, 546 (1928)). If that were the
appropriate standard under ERISA, every employer who administers
a plan for employees violates the standard before administration even
begins. While Firestone instructs that we be"guided" by common law
trust principles, that instruction is not the equivalent of the majority's
conclusion that ERISA is a "codification of the common law of
trusts." Slip op. at 13. Even the legislative history suggests that only
certain principles of trust law are codified. See Firestone, 489 U.S.
at 110. I believe that in this case we should determine only whether
Hughes Aircraft and Hartford abused their discretion in denying
Edmonds' benefits in the circumstances in this case, applying the rou-
tinely established level of review.

When we view the highly subjective evidence about Edmonds'
condition under this standard and the fact that judgments on both
sides are based more on what Edmonds has said than on what objec-
tive medical evidence demonstrates, we cannot say that the employer
abused its discretion in interpreting the plan to deny long-term dis-
ability benefits. The reports submitted on behalf of Edmonds find at
most that she is seriously depressed and cannot work. As her coun-
selor, who is not a doctor, said, "Mrs. Edmonds remains seriously
depressed and, in my opinion, is not capable of returning to office
work for an extended period of time." Her psychiatrist concluded that

                     20
Edmonds had an anxiety disorder, "exacerbated by thoughts of work,
discussion of work, or the need to attend her work environment." The
employer's evidence, supplied by two outside persons, although not
much more penetrating, nevertheless reaches a different conclusion.
The employer's retained doctor concedes that although Edmonds suf-
fers from "some psychiatric symptoms of dysthymia, that is: a rather
low-grade depression and dissatisfaction with life, symptoms of anxi-
ety that have persisted throughout her life, [and] a tendency to physi-
calize or somatize her stress," no medical or psychiatric limitations
would prevent Edmonds from "functioning adequately" at work. In
evaluating these conflicting reports, the majority seems to engage in
factual finding, favoring reports of the employee's privately retained
professionals, who are clearly advocating on her behalf, over reports
of two independent firms on retainer with the employer.

The symptoms of depression exhibited by the evidence in the
record merit sympathy and medical treatment. Indeed, the employer
found them to merit an award of short-term disability benefits. But to
conclude that the employer abused its discretion in denying Edmonds
long-term benefits cannot be supported by the record when applying
an abuse of discretion standard. Under that standard, we do not deter-
mine whether we agree with the result, but only whether there is a
rational basis for the decision. I believe there clearly is such a basis
here.

For the foregoing reasons, I respectfully dissent from the court's
decision to reverse and remand.

                    21
