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H.N. v. Blueshield

United States District Court, W.D. Washington, Seattle

June 15, 2017

H.N. BY AND THROUGH HER PARENTS AND GUARDIANS, JOHN DOE AND JANE DOE; AND JOHN DOE AND JANE DOE, HUSBAND AND WIFE, ON THEIR OWN BEHALF, Plaintiffs,
v.
REGENCE BLUESHIELD, A WASHINGTON CORPORATION; AND MBA GROUP INSURANCE TRUST HEALTH AND WELFARE PLAN, Defendants.

          ORDER

          The Honorable Richard A. Jones United States District Judge.

         This matter comes before the Court on Plaintiffs' motion for attorneys' fees (Dkt. # 53), motion establishing prejudgment interest and setting rate of interest (Dkt. # 55), and motion for nontaxable litigation expenses (Dkt. # 60). Defendants Regence Blueshield and MBA Group Insurance Trust Health And Welfare Plan (collectively “Defendants” or “Regence”) oppose the motions. Dkt. ## 62, 66, 76.

         I. BACKGROUND

         The facts of this case are detailed in the Court's prior orders. See Dkt. # 51. The Court will not reiterate those facts here. At issue is whether the Court should award Plaintiffs their attorneys fees and costs, and if so, how much the Court should award.

         II. DISCUSSION

         A. Plaintiffs were successful on the merits.

         In an ERISA action, the Court has discretion to award reasonable attorneys' fees and costs to either party if the party seeking fees has achieved “some degree of success on the merits.” Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 255 (2010) (quoting Ruckelshaus v. Sierra Club, 463 U.S. 680, 694 (1983)); see also 29 U.S.C. § 1132(g)(1). However, a claimant does not satisfy this requirement by achieving “trivial success on the merits” or a “purely procedural victor[y].” Hardt, 560 U.S. at 255. A claimant satisfies the Hardt standard “if the court can fairly call the outcome of the litigation some success on the merits without conducting a lengthy inquiry into the question whether a particular party's success was ‘substantial' or occurred on a ‘central issue.'” Hardt, 560 U.S. at 255 (internal quotation marks omitted) (brackets omitted).

         The Court finds that Plaintiffs were successful on the merits of their claims based on the Court's prior ruling, Dkt. # 51, and Defendants do not appear to dispute that Plaintiffs have met their burden under Hardt. Therefore, the Court may award attorney's fees and costs to Plaintiffs pursuant to 29 U.S.C. § 1132(g).

         B. Hummell Factors.

         Having found that a claimant satisfies the Hardt standard, the Court must then consider the five factors outlined by the Ninth Circuit in Hummell v. S. E. Rykoff & Co., 634 F.2d 446 (9th Cir. 1980), to determine whether to award reasonable attorneys' fees and costs. Simonia v. Glendale Nissan/Infiniti Disability Plan, 608 F.3d 1118, 1119 (9th Cir. 2010). Those factors are:

(1) the degree of the opposing parties' culpability or bad faith; (2) the ability of the opposing parties to satisfy an award of fees; (3) whether an award of fees against the opposing parties would deter others from acting under similar circumstances; (4) whether the parties 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.

Hummell, 634 F.2d at 453. “The Hummell factors reflect a balancing and [the Court] need not find that each factor weighs in support of fees.” McElwaine v. U.S. W., Inc., 176 F.3d 1167, 1173 (9th Cir. 1999).

         When the Court applies these factors, it “must keep at the forefront ERISA's remedial purposes that should be liberally construed in favor of protecting participants in employee benefit plans.” Id. at 1172. The court also applies “a ‘special circumstances' rule in which a successful ERISA participant should ordinarily recover an attorney's fee unless special circumstances would render such an award unjust.” Id. (quotations omitted).

         First, the Court does not find that Regence acted in bad faith by denying coverage for care for the three treatment periods at issue. Though Regence was wrong to deny coverage for H.N.'s treatment, Plaintiffs did not establish that Regence had a pattern or practice of summarily denying similar claims. Moreover, Regence presented evidence that it had reviewed H.N.'s claim several times and denied it based on the MCG guidelines. The Court found this review process to be insufficient ...


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