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Charles R. Jones v. Life Insurance Company of North America

August 10, 2011

CHARLES R. JONES, PLAINTIFF,
v.
LIFE INSURANCE COMPANY OF NORTH AMERICA DEFENDANTS.



The opinion of the court was delivered by: Michael A. Telesca United States District Judge

DECISION and ORDER

INTRODUCTION

Plaintiff, Charles R. Jones ("Plaintiff"), brought this action pursuant to the Employee Retirement Security Act of 1974, 29 U.S.C. §§ 1001 et seq. ("ERISA"), seeking long term disability benefits under an employee benefit plan (the "Plan") issued by Life Insurance Company of North America ("LINA" or "Defendant"). In a Decision and Order dated May 20, 2011, this Court granted in part and denied in part both parties' motions for summary judgment. (Docket #51). Both Plaintiff and LINA now move for attorney's fees and costs pursuant to 29 U.S.C. § 1132 (g)(1). Both motions are opposed. Plaintiff's motion for attorney's fees and costs is granted, however the fees and costs requested are reduced for the reasons set forth herein. Defendant's motion for attorney's fees and costs is denied.

Plaintiff also moves for an award of back benefits in the amount of $25,722.60 and pre-judgment interest in the amount of $900.29. LINA does not contest the award of back benefits or prejudgment interest, but its calculations are slightly different: $26,730.60 for back benefits and $893.13 for pre-judgment interest. Because Plaintiff has not contested LINA's alternate calculations and because the parties' calculations are not significantly different, this Court Orders that LINA pay Plaintiff $26,730.60 in back benefits and $893.13 in pre-judgment interest.

BACKGROUND

The background of this case is set forth in this Court's Decision and Order granting in part and denying in part the parties' motions for summary judgment. Accordingly, the facts are only repeated here as necessary to explain this Court's decisions on the instant motions.

On May 20, 2011, this Court granted Plaintiff's motion for summary judgment to the extent that he sought long-term disability benefits under the Plan. This Court specifically found that Plaintiff was disabled under the Plan definition of disability and that LINA failed to consider relevant evidence from Plaintiff's treating physicians, denying him a full and fair review of his claim. Without reaching the actual merits, this Court dismissed Plaintiff's claim for breach of a fiduciary duty, as it was largely duplicative of his claim for benefits and the relief he sought was identical.

This Court also granted LINA's cross-motion for summary judgment on its claim for offset, based on the Plan and a reimbursement agreement signed by Plaintiff, requiring that he reimburse LINA to the extent that benefits were overpaid based on his receipt of social security disability benefits. LINA was then ordered to calculate and pay Plaintiff back-benefits pursuant to the Plan, with interest, less $35,877.40, the amount Plaintiff owed LINA pursuant to the Plan and reimbursement agreement.

DISCUSSION

Plaintiff now seeks attorney's fees in the amount of $115,837.50, representing 202.5 hours of work performed by Howard D. Olinsky, Esq., a partner at Olinsky & Shurtliff at a rate of $350 per hour; 34.2 hours performed by Jaya A. Shurtliff, Esq, a partner at Olinsky & Shurtliff, at a rate of $350 per hour; and 132.6 hours of work performed by Marcie P. Eaton, a associate in her second year at Olinsky & Shurtliff, at a rate of $250.00 per hour. Plaintiff also seeks costs in the amount of $1,126.93. Defendant argues that this Court should not exercise its discretion to award Plaintiff attorney's fees and costs and, in the alternative, that the fees requested are excessive and that costs incurred prior to this lawsuit should be excluded.

Defendant cross-moves for an award of attorney's fees in the amount of $43,596.80, representing 9 hours of work performed by Fred N. Knopf, Esq., a partner at Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, at a rate of $284 per hour; and 176.9 hours of work performed by Emily A. Hayes, Esq., now a partner at Wilson, Elser, Moskowitz, Edelman & Dicker, LLP, at a rate of $232 per hour. Defendant also seeks costs in the amount of $2,851.15. Plaintiff argues that awarding Defendant attorney's fees and costs is inappropriate in this case and that Plaintiff's requested fees are reasonable. Plaintiff has not responded to Defendant's argument that certain costs should be excluded.

I. Award of Attorney's Fees and Costs

29 U.S.C. § 1132(g)(1) states, "[i]n any action under this subchapter...by a participant, beneficiary, or fiduciary, the court in its discretion may allow a reasonable attorney's fee and costs of action to either party." Prior to the Supreme Court's recent decision in Hardt v. Reliance Standard Life Insurance Co., --- U.S. ----, 130 S. Ct. 2149 (2010), interpreting § 1132, courts in this Circuit and others used a set of factors to determine whether a district court should exercise its discretion under § 1132 to award attorney's fees and costs. See Hardt, at 2158 (discussing use of factors in the Fourth Circuit); see also Chambless v. Masters, Mates & Pilots Pension Plan, 815 F.2d 869, 871 (2d Cir.1987)(outlining the factors employed in the Second Circuit). The Court in Hardt held that the test for determining whether a court should exercise its discretion to award fees to either party pursuant to § 1132, is whether that party achieved "some degree of success on the merits." Hardt, 130 S.Ct. at 2158. "A claimant does not satisfy that requirement by achieving trivial success on the merits or a purely procedural victory, but does satisfy it if the court can fairly call the outcome of the litigation some success on the merits without conducting a lengthy inquiry into the question whether a particular party's success was substantial or occurred on a central issue." Id. (internal citations omitted).

The Supreme Court, however, did not foreclose the possibility that a district court might utilize a set of factors to determine whether to exercise its discretion, if it has initially determined that a party is eligible for a fee award because it has achieved some degree of success on the merits. Id. at note 8. Recently, the Second Circuit stated, "[a] court may apply-but is not required to apply-the Chambless factors in channeling its discretion when awarding fees under ยง 1132(g)(1). So long as a party has ...


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