MetLife Exec Not Entitled to Additional Pension

(CN) - A former MetLife executive cannot claim pension benefits based on a $2.5 million FINRA arbitration award compensating him for the company's retaliation against him, the 2nd Circuit ruled Thursday.

Ronald Roganti began working for Metropolitan Life Insurance Company, also known as MetLife, in 1971. He worked there for over three decades, eventually becoming a managing director of a MetLife business unit.

But from 1999 to 2005, he claimed, his relationship with MetLife deteriorated due to his opposition to unethical business practices employed by some of the firm's salespeople.

Roganti said the company took a number of retaliatory actions over this period that negatively impacted his compensation.

Roganti's compensation peaked in 2001, when he earned $2 million, but it declined to $67,000 by 2005.

A Financial Industry Regulatory Authority arbitration panel later agreed with Roganti, finding that he is entitled to compensatory damages of $2.5 million.

However, the award did not state what the damages "were intended to compensate Roganti for, did not allocate the damages to particular years of Roganti's employment, and did not instruct MetLife to recalculate Roganti's pension benefits based on the award," U.S. Circuit Judge Debra Ann Livingston said, writing for the three-judge panel.

Therefore, the New York-based appeals court ruled that MetLife did not act capriciously by denying Roganti's subsequent benefits claim, because the FINRA panel did not say its award was, in fact, back pay.

"It is undisputed that Roganti offered no direct evidence that the FINRA award represents back pay, and that the time for seeking clarification of the award from the arbitral panel was allowed to pass," Livingston wrote.

Even assuming that some of the FINRA award might have constituted back pay, and it probably did, it is impossible to tell how much the FINRA panel intended as back pay, and therefore how much was benefits-eligible, the panel reasoned.

"Roganti's theory depends on the assumption that the arbitrators awarded him the difference between $1.506 million annually and his actual earnings from 2003 to 2005, and then intended for MetLife to calculate his pension," Livingston said. "But despite the fact that Roganti's counsel specifically suggested that the arbitrators direct MetLife to recalculate the pension, the award does not manifest any such intention. The silence is significant."

` The 2nd Circuit's ruling overturned a district court decision in Roganti's favor.

The court concluded by criticizing Roganti for failing to seek clarification from the FINRA panel within the permitted time frame.

"Permitting Roganti to recover under these circumstances, despite the uncertainty that he could have helped to prevent, would provide poor incentives for future claimants in his position," the opinion stated.

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