Attorney fee awards under ERISA loom larger in the imagination of lawyers and, to the extent they note it at all, the public than they do in the real world. It’s likely due to the outsize coverage that the occasional very large fee award, usually entered as part of a class action settlement, receives in the media. In truth, though, while ERISA is one of the few areas of the law where a prevailing party has a right to a fee award, they aren’t actually granted all that often, simply because relatively few cases actually reach that stage of the proceedings. Most ERISA cases either end with a defense win (fees can technically be awarded to a prevailing defendant, but it seldom happens and when it does, only under very unusual circumstances) or settle without a fee proceeding ever occurring. As a result, there just aren’t nearly as many judicial decisions on fee determinations under ERISA, particularly in the non-class action context, as you would think, and there are particularly few in the First Circuit.
That said, and to some extent partly for that reason, I wanted to note this recent fee decision under ERISA out of the United States District Court for the District of Massachusetts, Holt v. Raytheon. I think it’s notable for a few reasons, which I wanted to mention in passing:
• The hourly fee awarded to plaintiff’s counsel is reasonably commensurate with the hourly rates of much of the ERISA defense and compliance bar. The legal skill needed to actually win a case for a participant shouldn’t be underestimated, and it is good to see the Court recognize that with a corresponding billable rate.
• The Court unequivocally recognizes remand to the plan administrator as sufficient relief to warrant a substantial fee award. Defendants often challenge substantial fee requests when the relief awarded was remand by arguing that the level of success didn’t warrant the amount of time invested or the amount of fees sought. Remand, however, in this context, is a difficult relief to obtain and often has nearly or the same value to a plan participant as does obtaining an outright award of benefits from the court. This is partly because remand, for various reasons, often leads to a settlement rather than to the continuation of the dispute.
• Defendants often argue to the court that the hours invested by plaintiffs’ counsel were excessive and the accompanying fees should be reduced accordingly. However, in my experience (which encompasses both representing defendants and plaintiffs, as well as both defending against and prosecuting fee requests), both defense counsel and courts often underestimate just how much time it takes to properly and effectively prosecute a claim on behalf of a plaintiff. The decision in Holt reflects a reasoned and conservative approach to reduction of the hours claimed by plaintiff’s counsel.