Tuesday, March 31, 2009

Plaintiff in ERISA Action Not Entitled to Fees Incurred During Stay For Voluntary Claim Reassessment

In KAHANE v. UNUM LIFE INSURANCE COMPANY OF AMERICA, No. 08-15022 (11th Cir. March 31, 2009), the Eleventh Circuit held a plaintiff who agrees to a stay in ERISA litigation in order to participate in a voluntary claim reassessment process is not entitled to fees for work done during the stay. The court allowed fees for all work done prior to the voluntary stay. The Health Plan Law Blog has a post about this case here.

In this appeal, we consider whether a Plaintiff who agreed to stay litigation brought pursuant to the Employee Retirement and Income Security Act (ERISA), 29 U.S.C. § 1132(a)(1)(B), and participate in a voluntary claim reassessment process with a Defendant insurer, is entitled to recover attorney’s fees for work done in that process. We conclude that the claim reassessment process at issue in this appeal is substantially similar to the pre-litigation administrative proceedings required by ERISA. Because we conclude that attorney’s fees and costs are not recoverable for pre-litigation administrative procedures under 29 U.S.C. § 1132(g)(1), they are not available for this claim reassessment process. We also conclude that the district court did not abuse its discretion in limiting the amount of the Plaintiff’s recovery of attorney’s fees and costs for preparation of the motion for fees and costs.


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