Pakovich v. Verizon LTD Plan
653 F.3d 488
| 7th Cir. | 2011Background
- Pakovich, a Verizon retail sales representative, became disabled and sought long-term disability benefits under Verizon's ERISA Plan.
- Broadspire terminated her benefits after 24 months under the own-occupation standard; the district court found eligibility for the first 24 months but not beyond, and remanded for eligibility under the any-occupation standard.
- On the first appeal, the Seventh Circuit reversed and remanded to the Plan Administrator for a determination of benefits beyond 24 months.
- After almost five months of silence from the Plan, Pakovich filed Pakovich II asserting a deemed denial for the any-occupation period and seeking ERISA § 502(a)(1)(B) benefits and § 502(g) fees.
- The Plan later paid the requested benefits in full and agreed to continue paying so long as Pakovich remained eligible; the district court then addressed mootness and later granted summary judgment for Pakovich on the merits, ordering ongoing monthly benefits.
- The Seventh Circuit vacated the district court's summary-judgment grant on the benefits claim as moot, but affirmed the denial of Pakovich's attorney-fee request.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Pakovich II became moot as to benefits. | Pakovich argues the Plan's silence denied her benefits deemed under ERISA. | Plan asserts mootness because it fully paid the requested benefits and future payments were guaranteed by eligibility. | Benefit claim was moot; district court lacked jurisdiction over the merits. |
| Whether the district court retained equitable jurisdiction to decide fees after mootness of the benefits claim. | Fees remain recoverable under ERISA § 502(g) and FOIA-like equitable principles. | No jurisdiction to award fees once the merits are moot. | Equitable jurisdiction to adjudicate fees persists despite mootness of benefits. |
| Whether the district court erred in denying Pakovich's ERISA § 502(g) fee petition. | Hardt and related standards allow fee recovery for some degree of success on the merits; Pakovich should be compensated. | The planer's conduct was substantially justified; Pakovich failed to substantiate fees and rates; denial was proper. | District court did not abuse discretion; fee denial affirmed. |
Key Cases Cited
- Hardt v. Reliance Standard Life Ins. Co., 130 S. Ct. 2149 (2010) (fee-shifting requires some degree of success on the merits)
- Cornucopia Inst. v. U.S. Dep't of Agric., 560 F.3d 673 (7th Cir. 2009) (courts retain equitable jurisdiction to adjudicate fee claims after mootness)
- In re Repository Techs., Inc., 601 F.3d 710 (7th Cir. 2010) (mootness and equitable considerations in federal cases)
- Seagal v. Segal, 432 F.3d 767 (7th Cir. 2005) (standards for mootness and relief)
- Stark v. PPM Am., Inc., 354 F.3d 666 (7th Cir. 2004) (burden to prove reasonable attorney rates and costs)
- Herman, Community v. Pension Fund, 423 F.3d 684 (7th Cir. 2005) (extremely deferential standard for abuse of discretion in fee rulings)
- Ruckelshaus v. Sierra Club, 463 U.S. 680 (1983) (some degree of success on the merits may warrant fees)