United States District Court, D. Massachusetts
DIAHANN L. GROSS
SUN LIFE ASSURANCE COMPANY OF CANADA
MEMORANDUM OF DECISION
RYA W. ZOBEL, District Judge.
The plaintiff in this ERISA action, Diahann Gross, seeks attorneys' fees and costs following her successful appeal of this court's summary judgment rulings. The First Circuit, which first heard plaintiff's fee petition, determined that she is entitled to some fees and costs from defendant Sun Life Assurance Company of Canada ("Sun Life"), but it remanded to this court for calculation of those amounts. See Gross v. Sun Life Assurance Co. of Can., 763 F.3d 73, 82 (1st Cir. 2014). Having considered the parties' filings and completed a detailed analysis of the submitted billing records, the court will allow fees and costs, but at a level substantially below the amounts requested.
Both this court and the First Circuit have recounted the facts of this case at length, so I will discuss only the relevant details here. See, e.g., Gross v. Sun Life Assurance Co. of Can., 734 F.3d 1, 4-5 (1st Cir. 2013); Gross v. Sun Life Assurance Co. of Can., No. 09-cv-11678-RWZ, 2012 WL 29061, at *1-3 (D. Mass. Jan. 6, 2012) (Docket # 52).
Plaintiff is an optician and office manager at an eye clinic in Lexington, Kentucky. After complaining of several ailments, which were later substantiated by a doctor's report, plaintiff was placed on leave in August 2006. Plaintiff is covered by a long-term disability policy that her employer obtained, indirectly, from defendant Sun Life. She filed a claim seeking long-term disability benefits, but it was denied based on "insufficient objective evidence to substantiate" a disability that precluded her from working. Plaintiff filed an administrative appeal of that decision, but it was denied.
On January 21, 2009, plaintiff sued Sun Life in Kentucky state court challenging the denial of benefits on state-law grounds. A month later, Sun Life removed that action to the United States District Court for the Western District of Kentucky and moved to dismiss the complaint. After an adverse (but not dispositive) ruling on that motion, plaintiff voluntarily dismissed the Kentucky case on September 8, 2009.
Plaintiff then sought refuge in the courts of a second commonwealth, filing a complaint alleging similar state law violations in Norfolk Superior Court the same day she dismissed the Kentucky case. Sun Life again removed the state-court complaint, landing it in this court. Sun Life again moved to dismiss, contending that the state claims were preempted by ERISA. I allowed that motion but permitted plaintiff to file an amended complaint. On March 12, 2010, plaintiff did that, again asserting the same five state-law claims that both the Kentucky court and I had dismissed, but adding two ERISA claims. On Sun Life's motion, I again dismissed the five state-law claims.
Discovery ensued, accompanied by two unsuccessful discovery motions by plaintiff. Then, in February 2011, plaintiff moved the court to apply a de novo standard of review to the evaluation of her ERISA claims. I denied that motion, so the parties filed cross-motions for summary judgment. In those motions, plaintiff contended that her plan was exempt from ERISA under the regulatory safe harbor exception, see, e.g., 29 C.F.R. § 2510.3-1(j); Johnson v. Watts Regulator Co., 63 F.3d 1129, 1131-32 (1st Cir. 1995), and that, even if the plan was not exempt, Sun Life's denial of plaintiff's benefit request was arbitrary and capricious (applying the standard of review that I set in denying her previous motion). I denied plaintiff's summary judgment motion and allowed Sun Life's.
Plaintiff appealed, contending that the court erred by finding the safe harbor inapplicable, the standard of review to be arbitrary and capricious, and defendant's actions insufficient to meet the arbitrary and capricious standard. The First Circuit affirmed on the safe harbor issue, but reversed on the standard of review. Although the First Circuit concluded that each party should bear its own costs for the appeal, plaintiff moved for costs and fees in the First Circuit. A split panel, acting on the fee petition (and not directly addressing costs), concluded that plaintiff is entitled to some fees on the issues on which she has been successful and remanded to this court for determination of the fee award.
Civil litigants generally must bear their own costs and pay their own counsel, but Congress has altered that background rule for ERISA cases. ERISA provides that "[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." 29 U.S.C. § 1132(g)(1). The Supreme Court has interpreted this provision to mean that an award of fees and costs is appropriate where a claimant shows "some degree of success on the merits." Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 253 (2010), as the First Circuit has determined that plaintiff has done in this case. Gross, 763 F.3d at 82.
A. Attorneys' Fees
Calculation of fee awards generally follows the lodestar approach, and the First Circuit has instructed this court to apply that methodology here. Gross, 763 F.3d at 86. The lodestar approach begins by finding "[t]he product of the hours reasonably worked times the reasonable hourly rate(s)." Cent. Pension Fund of the Int'l Union of Operating Eng'rs & Participating Emps. v. Ray Haluch Gravel Co., 745 F.3d 1, 5 (1st Cir. 2014). Reasonableness is the touchstone of this calculation. Reasonable fees are the "prevailing rates in the community [of the court] for comparably qualified attorneys." United States v. Metropolitan Dist. Comm'n, 847 F.2d 12, 19 (1st Cir. 1988). Likewise, reasonable hours are the hours "actually spent on the case, " Lipsett v. Blanco, 975 F.2d 934, 937 (1st Cir. 1992), not including "hours that are excessive, redundant, or otherwise unnecessary." Hensley v. Eckerhart, 461 U.S. 424, 434 (1983). Once the threshold lodestar is set, "[n]umerous factors... may support upward or downward adjustments" from it. Gross, 763 F.3d at 86. For example, if the plaintiff failed to prevail on claims ...