United States District Court, D. Massachusetts
ORDER REGARDING ATTORNEY'S FEES
A. O'TOOLE, JR. UNITED STATES DISTRICT JUDGE.
in this case, I denied the defendant's motion for summary
judgment and granted the plaintiff's motion to remand,
directing Unum to conduct “a more thorough inquiry into
the relationship between Host's injury and his income
loss.” (Op. & Order 4 (dkt. no. 64).) In that
Order, I concluded that “Unum had the ability under the
disability policy to compel Deutsche Bank to provide any
information reasonably required to resolve a benefits claim.
Proceeding to deny the claim without pursuing additional . .
. information from the bank when there were disputed factual
issues was not reasonable.” (Id.) The
plaintiff now seeks an award of attorney's fees and costs
from the defendants under the Employee Retirement Income
Security Act of 1974 (“ERISA”). Host requests an
award of $58, 548.88 for attorney's fees and an
additional $684.88 in expenses. (Pl.'s Reply Br. in Resp.
to Unum's Opp'n to Pl.'s Mot. for Att'y Fees
& Costs 2 (dkt. no. 99).) Unum has opposed Host's
motion for fees, but has not objected to the costs Host
the hearing on the motion, the parties informed the Court
that, as instructed, Unum had reviewed Host's claim for
benefits again and again determined that Host was not
eligible for the disability benefits he claimed. In a
separate pending action, Host is appealing that decision.
ERISA, a court has the discretion to award “a
reasonable attorney's fee and costs of action to either
party.” 29 U.S.C. § 1132(g)(1). However, a
“claimant must show ‘some degree of success on
the merits' before a court may award attorney's fees
under § 1132(g)(1), ” but this success must be
more than “trivial success on the merits” or
“purely procedural.” Hardt v. Reliance
Standard Life Ins., 560 U.S. 242, 255 (2010) (quoting
Ruckelshaus v. Sierra Club, 463 U.S. 680, 694
(1983)). In order for a court to find the requisite level of
“success” there must be “some meaningful
benefit for the fee-seeker.” Gross v. Sun Life
Assurance Co. of Can., 763 F.3d 73, 77 (1st Cir. 2014)
(quoting Gastronomical Workers Union Local 610 &
Metro. Hotel Ass'n Pension Fund v. Dorado Beach Hotel
Corp., 617 F.3d 54, 66 (1st Cir. 2010)).
present case, the Court granted Host's motion for remand
so that Unum could conduct a more thorough review of his
application for benefits. Host asserts that achieving the
remand entitles him to an award of attorney's fees; Unum
argues that a remand does not amount to the
“success” required in order to be awarded such
fees. Unum's position is unpersuasive.
Gross, the Court of Appeals noted:
Most courts considering the question left unanswered in
Hardt have held that a remand to the plan
administrator for review of a claimant's entitlement to
benefits, even without guidance favoring an award of benefits
or an actual grant of benefits, is sufficient success on the
merits to establish eligibility for fees under section
763 F.3d at 77 (collecting cases). The court surmised that
remand for further administrative proceedings is regarded as
“success” because such a decision is inherently
based on a finding of some deficiency in the initial
administrative review which entitles the claimant to a
“renewed opportunity to obtain benefits or
compensation.” Id. at 78 (citations omitted).
Additionally, the court noted “a remand for a second
look at the merits of [the claimant's] benefits
application is often the best outcome that a claimant can
reasonably hope to achieve from the courts. To classify such
success as a minimal or ‘purely procedural victory'
mistakes its importance.” Id. at 78-79.
argues that because Host's complaint only sought recovery
of payment of disability benefits, which was not provided by
the Court's remand order, Host was therefore unsuccessful
in his suit and ineligible for attorney's fees. Unum
ignores the fact that Host's complaint also contains a
prayer for relief requesting that this Court “[a]ward
such other relief as the court deems just and reasonable,
” (Compl. 10 (dkt. no. 1)), which “easily
incorporates the court-ordered remand granted by the Court,
” see Colby v. Assurant Employee Benefits, 635
F.Supp.2d 88, 96-97 (D. Mass. 2009).
Unum's subsequent determination on remand that Host was
not eligible for disability benefits does not disqualify him
from receiving attorney's fees for his success in
obtaining the remand. See Gross, 763 F.3d at 80-81.
Although Unum's ultimate denial of benefits on remand may
be relevant to the Court's calculation of attorney's
fees, that fact should not prevent Host from recovering fees
for getting a second chance at making his case. See
id. Regardless of what occurred after the remand order,
Host successfully demonstrated that Unum's initial
decision was defective, and he is eligible to recover
reasonable attorney's fee as a result of that success.
See Petrone v. Long Term Disability Income Plan for
Choices Eligible Emps. of Johnson & Johnson &
Affiliated Cos., Civil Action No. 11-10720-DPW, 2014 WL
1323751, at *3, n.1 (D. Mass. Mar. 31, 2014) (citing
Richards v. Johnson & Johnson, Civil Action No.
08-279, 2010 WL 3219133 (E.D. Tenn., Aug. 12, 2010)).
determined that Host is eligible to receive attorney's
fees under § 1132(g)(1), the Court must consider whether
an award is appropriate using the five-factor test
articulated in Cottrill v. Sparrow, Johnson &
Ursillo, Inc., 100 F.3d 220, 225 (1st Cir. 1996)
(abrogated on other grounds by Hardt, 560 U.S. 242).
No single factor is outcome determinative. Gross,
763 F.3d at 83.
first factor, the degree of culpability or bad faith
attributable to Unum, weighs slightly in favor of Host.
Although there is no evidence of bad faith by Unum,
“[i]n finding a need for a remand, [the Court] [has]
implicitly found culpability.” See Hatfield v. Blue
Cross & Blue Shield of Mass., Inc., 162 F.Supp.3d
24, 44-45 (D. Mass. 2016) (citing Cannon v. Aetna Life
Ins., Civil Action No. 12-10512-DJC, 2014 WL 5487703, at
*4 (D. Mass. May 28, 2014)). The remand order in this case
identified a deficiency in the review process conducted and
controlled by Unum, making it sufficiently culpable in the
relevant sense. See Janeiro v. Urological Surgery
Prof'l Ass'n, 457 F.3d 130, 143 (1st Cir. 2006).
second factor directs the Court to examine Unum's ability
to pay an award. Unum does not dispute that it has the
financial resources to pay, and so this factor also weighs in
Host's favor. However, Unum's ability to pay, alone,
“does not justify an award.” See
Hatfield, 162 F.Supp.3d at 45 (quoting
Cottrill, 100 F.3d at 226-27).
next factor, the extent to which an award would deter others
in similar circumstances, also weighs in Host's favor.
“The First Circuit has recognized the value of
motivating fiduciaries to comply more attentively with the
procedural obligations imposed by ERISA, including through
the development of complete administrative records.”
Hatfield, 162 F.Supp.3d at 45 (citing
Gross, 763 F.3d at 84-85). Awarding attorney's
fees in this case could encourage Unum, and ...