M. v. Beacon Health Options

CourtDistrict Court, D. Utah
DecidedJuly 27, 2023
Docket2:19-cv-00364
StatusUnknown

This text of M. v. Beacon Health Options (M. v. Beacon Health Options) is published on Counsel Stack Legal Research, covering District Court, D. Utah primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
M. v. Beacon Health Options, (D. Utah 2023).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF UTAH

THEO M. and M.M., MEMORANDUM DECISION AND ORDER GRANTING IN PART MOTION Plaintiffs, FOR AWARD OF ATTORNEY’S FEES v. AND COSTS

BEACON HEALTH OPTIONS, INC.; and Case No. 2:19-cv-00364-JNP-DBP CHEVRON CORPORATION MENTAL HEALTH AND SUBSTANCE ABUSE District Judge Jill N. Parrish PLAN, Magistrate Judge Dustin B. Pead Defendants.

Before the court is a motion for award of attorney’s fees and costs filed by Theo M. and M.M. (collectively, “Plaintiffs”). For the reasons set forth below, the court GRANTS Plaintiffs’ motion and orders Beacon Health Options, Inc. (“BHO”) and Chevron Corporation Mental Health and Substance Abuse Plan (collectively, “Defendants”) to pay Plaintiffs $51,460 in attorney’s fees and $400 in costs. BACKGROUND Plaintiffs brought this action pursuant to the Employee Retirement Income Security Act of 1974 (“ERISA”). 29 U.S.C. § 1001, et. seq. Theo M. was a participant in the Chevron Mental Health and Substance Abuse Plan (“the Plan”), an employee welfare benefits plan. M.M. was a beneficiary of the plan. BHO is the Plan’s named fiduciary and designated claims administrator. Plaintiffs sought care for M.M.’s mental health condition at two residential treatment centers. First, M.M. received treatment at Aspiro Adventures. Subsequently, he transferred to Daniels Academy, where he received additional care. BHO denied coverage for both periods of treatment. Plaintiffs appealed the denial of benefits and BHO upheld its denial determination through two internal appeals of each claim. Plaintiffs brought an action for recovery of benefits under ERISA, alleging this denial required their insurer to pay unreimbursed expenses. Both parties moved for summary judgment after the filing of the complaint in this case. The court denied Defendants’ motion while granting in part and denying in part Plaintiffs’ motion.

ECF No. 72. The court found BHO’s denial of benefits was arbitrary and capricious. Id. at 26, 31. Specifically, BHO had (1) failed to adequately explain its reasons for denying Plaintiffs’ claims and (2) disregarded the opinions of M.M.’s treating professionals. Id. at 26. The court reversed and remanded the case to BHO for reconsideration. Id. at 36. In its order, the court denied Plaintiffs’ request for prejudgment interest. Id. However, it found an award of attorney’s fees and costs appropriate because BHO bore culpability for failing to properly assess Plaintiffs’ claims, because BHO failed to “properly adjudicate Plaintiffs’ claims when it owes its members a fiduciary duty,” and because BHO arbitrarily and capriciously denied Plaintiffs benefits. Id. at 35. Additionally, the court concluded that BHO could satisfy an award of fees and the award would encourage BHO to follow ERISA’s regulations and requirements. Id. at

35-36. In response to the court’s order, which requested that Plaintiffs’ counsel submit a petition for fees and costs, Plaintiffs’ counsel submitted the motion at issue in this memorandum decision. ECF No. 74. LEGAL STANDARD In an ERISA action, “the court in its discretion may allow a reasonable attorney’s fee and costs of action to any party.” 29 U.S.C. § 1132(g)(1). In the Tenth Circuit, “[a] fee claimant need not be a prevailing party to be eligible for an award of attorney’s fees and costs under ERISA.” Cardoza v. United of Omaha Life Ins. Co., 708 F.3d 1196, 1207 (10th Cir. 2013) (citing Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010)). Instead, a district court has the discretion to award fees “as long as the fee claimant has achieved ‘some degree of success on the merits.’” Id. at 1207 (10th Cir. 2013) (quoting Hardt, 560 U.S. at 255). To decide whether a fee claimant is deserving of an award of attorney’s fees and costs, a district court “may consider” five different factors: (1) the degree of the opposing party’s culpability or bad faith; (2) the opposing party’s ability to satisfy an award of fees; (3) whether an award of fees would deter others from acting under similar circumstances; (4) whether the party requesting fees sought to benefit all participants and beneficiaries of an ERISA plan or to resolve a significant legal question regarding ERISA; and (5) the relative merits of the parties’ positions.

Id. When issuing an award of attorney fees in ERISA cases, courts use the hybrid lodestar method to determine the amount of fees to be awarded. Carlile v. Reliance Standard Life Ins. Co., No. 2:17-cv-01049, 2019 WL 8128545, at *1 (D. Utah Dec. 31, 2019) (citing Hensley v. Eckerhart, 461 U.S. 424, 433 (1983)). The hybrid lodestar method consists of “the number of hours reasonably expended on the litigation multiplied by a reasonable hourly rate.” Id. (internal quotation marks omitted.) “The reasonable hourly rate is the ‘prevailing [rate] in the community for similar services by lawyers of reasonably comparable skill, experience and reputation.’” Id. (alteration in original) (quoting Blum v. Stenson, 465 U.S. 886, 895 n.11 (1984)). When determining whether an hourly rate is reasonable, the court may consider affidavits of counsel, non-party attorney affidavits, and the court’s own knowledge. Id. It is counsel for the moving party’s burden to establish that the billed hours they request were “reasonably expended” by providing the court with “meticulous, contemporaneous time records that reveal, for each lawyer for whom fees are sought, all hours for which compensation is requested and how those hours were allotted to specific tasks.” Id. (internal quotation marks omitted). The court “must ensure the attorneys exercised billing judgment.” Id. (internal quotation marks omitted). This requires counsel to “make a good faith effort to exclude from a fee request hours that are excessive, redundant, or otherwise unnecessary.” Richards v. C&C Sheet Metal, No. 2:18-cv-00448, 2019 WL 2329502, at *3 (D. Utah May 30, 2019) (quoting Hensley, 461 U.S. at 434). “The court must also consider the degree of the plaintiffs’ success” in the case in assessing the reasonableness of the fee amount sought. Id. at *3.

Regarding costs, 28 U.S.C. § 1920 sets forth the items, including filing fees, that may be recovered as costs in an ERISA action. 28 U.S.C. § 1920; see also Allison v. Bank One-Denver, 289 F.3d 1223, 1248 (10th Cir. 2002), as amended on denial of reh’g (June 19, 2002). The court “has no discretion to award items as costs that are not set out in section 1920.” Sorbo v. United Parcel Service, 432 F.3d 1169, 1179 (10th Cir. 2005) (internal quotation marks omitted). ANALYSIS Plaintiffs request an award of $63,800 in attorney fees. ECF No. 74 at 6. This amount consists of 87.5 hours of Brian King’s work at a billable hourly rate of $600 per hour, 15.5 hours of Brent Newton’s work at a billable hourly rate of $320 per hour, and 25.6 hours of Samuel Hall’s work at a billable hourly rate of $250 per hour. Id. at 3, 6. Defendants oppose Plaintiffs’ motion, arguing that an award of attorney’s fees is inappropriate because Plaintiffs did not achieve success

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Related

Hensley v. Eckerhart
461 U.S. 424 (Supreme Court, 1983)
Blum v. Stenson
465 U.S. 886 (Supreme Court, 1984)
Sorbo v. United Parcel Service
432 F.3d 1169 (Tenth Circuit, 2005)
Graham v. Hartford Life and Accident Ins. Co.
501 F.3d 1153 (Tenth Circuit, 2007)
Rasenack Ex Rel. Tribolet v. AIG Life Insurance
585 F.3d 1311 (Tenth Circuit, 2009)
Cardoza v. United of Omaha Life Insurance
708 F.3d 1196 (Tenth Circuit, 2013)
Malloy v. Monahan
73 F.3d 1012 (Tenth Circuit, 1996)
Madeline D. v. Anthem Health Plans of Ky., Inc.
369 F. Supp. 3d 1159 (D. Utah, 2019)

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M. v. Beacon Health Options, Counsel Stack Legal Research, https://law.counselstack.com/opinion/m-v-beacon-health-options-utd-2023.