Sharp v. Trustees of the UMWA 1974 Pension Trust

CourtDistrict Court, C.D. Illinois
DecidedMarch 4, 2021
Docket3:18-cv-03056
StatusUnknown

This text of Sharp v. Trustees of the UMWA 1974 Pension Trust (Sharp v. Trustees of the UMWA 1974 Pension Trust) is published on Counsel Stack Legal Research, covering District Court, C.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Sharp v. Trustees of the UMWA 1974 Pension Trust, (C.D. Ill. 2021).

Opinion

IN THE UNITED STATES DISTRICT COURT FOR THE CENTRAL DISTRICT OF ILLINOIS SPRINGFIELD DIVISION

WILLIAM R. SHARP, ) ) Plaintiff, ) ) v. ) Case No. 18-cv-03056 ) TRUSTEES OF THE UMWA 1974 ) PENSION TRUST, ) ) Defendants. )

OPINION

SUE E. MYERSCOUGH, U.S. District Judge: This cause is before the Court on Plaintiff William R. Sharp’s Petition for Attorney’s Fees and Costs (d/e 33). For the reasons discussed below, Plaintiff’s Petition is GRANTED. Plaintiff is awarded attorney’s fees in the amount of $64,750.00, costs totaling $400.00, and prejudgment interest totaling $25,148.78. I. BACKGROUND In March 2018, Plaintiff filed a Complaint (d/e 1) against the Trustees of the United Mine Workers of America 1974 Pension Trust seeking to recover disability benefits under a pension plan governed by the provisions of the Employee Retirement Income Security Act of 1974 (“ERISA”). Plaintiff filed an Amended Complaint (d/e 16) in August 2018, and in October 2018 the parties filed opposing

motions for summary judgment (d/e 19, 21). Plaintiff alleged that he had injured his low back in a workplace accident that occurred while he was employed by a signatory company to the United Mine

Workers of America 1974 Pension Plan (“Plan”), that he was entitled to disability benefits under the Plan as a result of this injury, and that Defendants’ denial of his 2015 application for disability

benefits was therefore arbitrary and capricious. Defendants argued that Plaintiff had not proven that the mine accident in question was substantially responsible for his disability and that Defendants’

decision to deny Plaintiff disability benefits had therefore not been arbitrary and capricious. In February 2020, this Court issued an Opinion (d/e 31) finding that Plaintiff’s 2003 mine injury had

aggravated a preexisting back condition and thereby rendered him disabled. The Court rejected Defendants’ argument that Plaintiff was not eligible for disability benefits under the Plan unless the 2003 injury was “substantially responsible” for Plaintiff’s disability.

The Court also held that Defendants’ interpretation of the Plan during the administrative proceedings that followed Defendants’ 2016 denial of Plaintiff’s application for disability benefits was arbitrary and capricious. The Court granted summary judgment in

Plaintiff’s favor and awarded Plaintiff disability benefits under the Plan. In March 2020, Plaintiff filed the pending Motion for Attorney’s

Fees and Costs (d/e 33). Plaintiff initially sought $70,065.00 in attorney’s fees, as well as $400.00 in costs and $44,898.76 in prejudgment interest. See d/e 34, pp. 1, 6, 8. Plaintiff has since

revised his initial request and now seeks $64,750.00 in attorney’s fees, $400.00 in costs, and $25,148.78 in prejudgment interest. See d/e 41. Plaintiff’s requested attorney’s fee award represents a

total of 185 billable hours at a rate of $350.00 per hour. See d/e 41–2. Plaintiff supports the request with an affidavit filed by Grady E. Holley, one of Plaintiff’s attorneys (d/e 33–1), a sworn declaration

of attorney John A. Baker regarding the market value of the services rendered by Plaintiff’s counsel (d/e 33–5), and a detailed invoice listing the hours expended on this litigation by Plaintiff’s attorneys (d/e 41–2).

Defendants have filed a Response (d/e 36) arguing that attorney’s fees should not be awarded because Defendants’ position, though ultimately unsuccessful, was substantially justified and taken in good faith. Defendants also argue that if

attorney’s fees are awarded the hourly rate should be set at between $210 and $250 per hour and that prejudgment interest should not be awarded in this case.

II. ANALYSIS A. Plaintiff is Entitled to Reasonable Attorney’s Fees In ERISA litigation, a plaintiff who achieves “some degree of

success on the merits” is eligible for an award of attorney’s fees. Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 255 (2010). Once eligibility is established, the Seventh Circuit “has recognized

two tests for analyzing whether attorney’s fees should be awarded to a party in an ERISA case.” Kolbe & Kolbe Health & Welfare Benefit Plan v. Med. Coll. of Wisconsin, Inc., 657 F.3d 496, 505 (7th Cir.

2011). The first of these is a five-factor test in which a district court evaluates: (1) the degree of the losing parties’ culpability; (2) the degree of the losing parties’ ability to satisfy an award of attorney’s fees; (3) whether or not an award of attorney’s fees against the

losing parties would deter other persons acting under similar circumstances; (4) the amount of benefit conferred on members of the pension plan as a whole; and (5) the relative merits of the parties’ positions. Raybourne v. Cigna Life Ins. Co. of New York,

700 F.3d 1076, 1090 (7th Cir. 2012). The second test “looks to whether or not the losing party’s position was substantially justified.” Kolbe, 657 F. 4d at 506 (quoting Quinn v. Blue Cross &

Blue Shield Ass'n, 161 F.3d 472, 478 (7th Cir. 1998)). The Seventh Circuit has observed that the five-factor test is used to “structure or implement” the substantial justification test. Raybourne, 700 F.3d

at 1090 (citing Kolbe, 657 F.3d at 506). Here, Defendants do not dispute that Plaintiff has achieved some degree of success on the merits for purposes of attorney’s fee

award eligibility. The parties agree that the Court should implement the five-factor test and/or the substantial justification test to determine whether Plaintiff is entitled to reasonable

attorney’s fees. See d/e 34, pp. 2–5; d/e 36, p. 2. Because both tests weigh in favor of an award, the Court finds that Plaintiff is entitled to reasonable attorney’s fees. Defendants’ position was not substantially justified. As this

Court stated in its February 2020 Opinion (d/e 31), Defendants’ decision to deny Plaintiff disability benefits was arbitrary and capricious. Defendants’ position that Plaintiff was entitled to disability benefits under the Plan only if the 2003 injury was

“substantially responsible” for his disability was inconsistent with the plain and unambiguous language of the Plan. See d/e 31, pp. 42–51 (Discussing the arbitrary and capricious standard in the

ERISA context and finding Defendants’ interpretation of the Plan to be arbitrary and capricious); see also Young v. Verizon's Bell Atl. Cash Balance Plan, 748 F. Supp. 2d 903, 913 (N.D. Ill. 2010)

(holding that ERISA plan administrator’s interpretation of plan was not substantially justified where interpretation was inconsistent with plain language of plan).

The five-factor test also weighs in favor of awarding attorney’s fees. The first factor, Defendants’ culpability, is neutral. While there is little cause to believe that Defendants acted in bad faith, a

finding of bad faith is not necessary to support an award of attorney’s fees. See Raybourne, 700 F.3d at 1090 n.6. While a finding that a plan administrator made an arbitrary and capricious decision does not necessarily mean that the decision was “wholly

unjustified,” see Quinn, 161 F.3d at 479, culpability analysis under the first factor favors the plaintiff when a plan administrator “negligently or ignorantly construes unambiguous plan terms.” Young, 748 F. Supp. 2d at 913.

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