Barnes v. AT & T Pension Benefit Plan-Nonbargained Program
2013 U.S. Dist. LEXIS 105132
N.D. Cal.2013Background
- Plaintiff Quiller Barnes sued AT&T Pension Benefit Plan under ERISA claiming deficient notice (Count I) and failure to pay full pension benefits for lump-sum payees and a class (Count II); other counts were dismissed or resolved.
- District court granted summary judgment for Barnes on Count I (notice violation) but for the Plan on Count II as to lump-sum payees; Count II relief for deferred annuitants became contested through class proceedings and shifting Plan interpretations.
- The Plan proffered multiple, evolving interpretations of Plan § 3.4(d)(3); ultimately the Benefit Plan Committee (BPC) adopted an interpretation (Aug. 31, 2011) favorable to deferred annuitants.
- Barnes moved for attorneys’ fees and costs under 29 U.S.C. § 1132(g)(1), claiming (1) success on Count I and (2) a catalyst effect for Count II that prompted the BPC interpretation benefiting deferred annuitants.
- The court found Barnes achieved “some degree of success” (Hardt standard): Count I success (remedy limited) and catalyst success for deferred annuitants, awarded costs, but deferred specifying the fee amount pending supplemental briefs.
- After supplemental briefing, the court awarded $193,461.63 in fees (principally for Count II-related work, with adjustments) and $15,189.95 in fees-on-fees; costs decision deferred for further briefing.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether plaintiff achieved “some degree of success” under 29 U.S.C. § 1132(g)(1) to permit fee award | Barnes: Count I ruling and catalyst effect for Count II satisfy Hardt’s "some degree of success" threshold | Plan: Count I was only a trivial or procedural victory; catalyst theory not permitted or not shown; exhaustion problems | Court: Barnes cleared Hardt for Count I (remand-type relief is substantive) and Count II as catalyst theory viable under § 1132(g)(1); some success established |
| Whether the catalyst theory can justify fee awards under ERISA § 1132(g)(1) | Barnes: his litigation prompted the Plan/BPC to adopt a favorable interpretation for deferred annuitants, so fees are warranted | Plan: Buckhannon rejects catalyst theory; even if catalyst, plaintiff failed to raise § 3.4(d)(3) in admin proceedings so should not recover | Court: Catalyst theory remains viable post-Hardt for § 1132(g)(1); Barnes’s suit precipitated Plan action and qualifies as a catalyst for fees |
| Application of Hummell factors (culpability, ability to pay, deterrence, benefit to others, relative merits) | Barnes: factors favor fees because Plan’s shifting interpretations harmed participants and action benefited annuitants | Plan: low culpability, limited benefit to others (small number of annuitants), limited deterrence | Court: On balance Hummell factors support awarding fees though culpability low and benefit limited; award discretion affirmed |
| Proper quantum of fees (Hensley lodestar, time-period limits, reductions) | Barnes: requests fees for specified periods (pre-Feb 5, 2010 for Count I; Jan 21–Aug 31, 2011 for Count II) and fees-on-fees | Plan: many entries excessive, unrelated, pre-notice, block-billed, clerical tasks; seek large percentage haircut or complete exclusion of certain periods | Court: disallowed fees for Count I because Plan provided notice in an April 20, 2009 ENE; for Count II awarded lodestar with a 10% reduction for limited success plus a $10,000 award for 30(b)(6) deposition; awarded $193,461.63 fees and $15,189.95 fees-on-fees subject to further cost briefing |
Key Cases Cited
- Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010) (fee award under § 1132(g)(1) requires “some degree of success on the merits”)
- Ruckelshaus v. Sierra Club, 463 U.S. 680 (1983) (‘‘some degree of success’’ standard for fee-shifting statutes that remove strict prevailing-party requirement)
- Hensley v. Eckerhart, 461 U.S. 424 (1983) (lodestar method and reduction for limited success)
- Hummell v. S.E. Rykoff & Co., 634 F.2d 446 (9th Cir. 1980) (five-factor test guiding ERISA fee discretion)
- Buckhannon Bd. & Care Home v. W. Va. Dept. of Health & Human Resources, 532 U.S. 598 (2001) (rejection of catalyst theory under statutes requiring prevailing party)
- McCown v. City of Fontana, 565 F.3d 1097 (9th Cir. 2009) (applying Hensley; treat related claims as a common core)
- Anderson v. AB Painting & Sandblasting, Inc., 578 F.3d 542 (7th Cir. 2009) (proportionality and reasonableness of fees vis-à-vis small monetary awards)