(Reuters) — MetLife Inc. has retained a top Washington lawyer in its bid to escape a plan by the U.S. financial risk council to subject it to far tougher rules, a sign the largest U.S. insurer may be preparing a legal challenge.

A MetLife spokesman told Reuters the company had retained Eugene Scalia, a partner at law firm Gibson Dunn L.L.P., who has successfully fought major regulatory decisions by other agencies.

The firm had not decided whether it would ultimately bring a court case, the spokesman said.

The company made a final plea at a closed-door meeting of the regulatory group on Monday to contest a proposal to tag it as a "systemically important" firm, which would subject it to tougher capital rules and oversight by the Federal Reserve.

Mr. Scalia was seen walking into the Treasury Department, which houses the Financial Stability Oversight Council, with MetLife CEO Steven Kandarian, finance chief John Hele and other representatives.

MetLife, unlike rivals American International Group Inc. and Prudential Financial Inc. that have already been deemed "systemic," has vigorously and publicly fought the tag. Mr. Kandarian hit back when FSOC in September first proposed to add MetLife to the group.

He issued a statement saying MetLife was a source of strength during the 2008 financial crisis and that the insurer was "not ruling out any of the available remedies."

After hearing from MetLife on Monday, the first in-person meeting between the insurer and the top regulators after months of staff-level talks, regulators will have 60 days to make a final decision, which MetLife can then fight in court.

MetLife will have a formidable ally in Mr. Scalia if it does decide to do so. Mr. Scalia, the son of Supreme Court Justice Antonin Scalia, has a track record of successfully fighting other decisions by federal regulators.

In 2012, he knocked out a rule by the Commodity Futures Trading Commission to impose caps on positions held by traders to tame speculation. He also foiled a number of major rules by the U.S. Securities and Exchange Commission in recent years.

Still, observers say MetLife faces an uphill battle with FSOC — which consists of the heads of the main financial watchdogs — after an international body of regulators had already deemed MetLife systemic last year.

The 2010 Dodd-Frank Wall Street Reform and Consumer Protection Act automatically designated banks with more than $50 billion in assets as "systemically important financial institutions."

But it gave the risk council the power to also tap financial firms that are not banks if they are so big and risky that their activities could destabilize U.S. markets.

To date, the regulators who make up FSOC have not spoken publicly about MetLife. However, public documents justifying their designations of AIG and Prudential, and FSOC's annual report, shed light on their concerns.

The watchdogs worry insurers have their fingers in too many risky activities even after the credit crisis, and that they are no longer just straightforward providers of traditional life or car insurance policies.

One issue likely to be weighed is captive reinsurance, an accounting practice through which life insurers can lower their reserves, or funds set aside to pay claims.

In captive reinsurance, life insurance companies transfer risk to entities affiliated with their business in overseas jurisdictions or U.S. states with light-touch rules, which allows them to free up regulatory capital.

In an apparent effort to reduce some scrutiny, MetLife last year announced it would merge three of its life insurance companies and a Bermuda-based captive reinsurance unit into one U.S.-based company, to "address regulatory concerns about the use of captive reinsurance."

Another point regulators have looked into is securities lending. Insurers hold huge portfolios of stocks and bonds that they often lend out, typically to broker-dealers or hedge funds, backed by collateral, in return for a small fee.

This is generally seen as a low-risk activity, but it played a key role in the near-collapse of AIG, which was reinvesting much of its collateral in often complex and risky instruments that rapidly lost value when the crisis hit.

Last, regulators are wary about a possible run on an insurer much in the same way as on a bank. The industry is fiercely contesting this perception, saying its business model is different and funding more stable.

But the Federal Insurance Office, a Treasury unit that monitors the industry, last year pointed out that AIG was not the only U.S. insurer in trouble. Insurers Hartford Financial Services Group Inc. and Lincoln National Corp. both received taxpayer aid during the crisis.