Protingent Inc v. Gustafson-Feis

Filing 84

ORDER granting in part and denying in part Plaintiff's 81 Motion for Attorney Fees. It is hereby ORDERED that Plaintiff is entitled to an award of $66,676.00 from Defendant Lisa Gustafson-Feis, representing the reasonable attorney's fees incurred by Plaintiff in recovering the $73,326.54 owed to the Plan. Signed by District Judge Kymberly K. Evanson. (SB)

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1 The Honorable Kymberly K. Evanson 2 3 4 5 6 7 UNITED STATES DISTRICT COURT WESTERN DISTRICT OF WASHINGTON AT SEATTLE 8 9 10 11 12 13 PROTINGENT, INC., a Washington corporation, Plaintiff, v. LISA GUSTAFSON-FEIS, an individual, Defendant. 14 15 16 17 18 19 20 21 LISA GUSTAFSON-FEIS, an individual, Counterclaim Plaintiff, v. PROTINGENT, INC., a Washington corporation; AETNA LIFE INSURANCE COMPANY, a Connecticut corporation; RAWLINGS & ASSOCIATES PLLC, a Kentucky professional limited liability company, Counterclaim Defendants. 22 23 24 25 26 27 ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) CASE NO. 2:20-CV-1551-KKE ORDER GRANTING IN PART PLAINTIFF’S MOTION FOR AWARD OF ATTORNEY’S FEES, COSTS, AND INTEREST This matter comes before the Court on Plaintiff Protingent, Inc.’s motion for an award of attorney’s fees, costs, and interest. Dkt. No. 81. In a prior order, the Court found Protingent entitled to judgment in the amount of $73,326.54, and also entitled to recover its attorney’s fees as the prevailing party. See Dkt. No. 80. The Court instructed Protingent to file a motion for fees, ORDER - 1 1 with briefing on its entitlement to and calculation of pre- and post-judgment interest. 2 Protingent has now filed that motion and briefing (Dkt. Nos. 81–82), requesting an award of 3 4 5 6 Id. $67,676.00 in fees, $559.70 in costs, and “pre-judgment and post-judgment interest at a rate equal to the weekly 1-year constant maturity Treasury yield, as published by the Board of Governors of the Federal Reserve System, for the calendar week preceding entry of judgment pursuant to 28 7 U.S.C. § 1961.” Dkt. No. 81 at 2. Defendant Lisa Gustafson-Feis did not file an opposition to 8 Protingent’s motion. See Dkt. No. 83. 9 10 11 12 For the following reasons, the Court grants the motion as to Protingent’s request for attorney’s fees, denies the motion as to Protingent’s request for an award of pre-judgment interest, and directs Protingent to file a separate bill of costs. I. 13 ATTORNEY’S FEES & PREJUDGMENT INTEREST Protingent argues that it is entitled to recover the attorney’s fees it expended in recovering 14 15 the amounts owed to the Plan, as provided in the express terms of the Plan. Dkt. No. 69 at 17. 16 Protingent also argues that, in the alternative, it is entitled to an award of discretionary fees under 17 29 U.S.C. § 1132(g) primarily because Gustafson-Feis litigated this matter in bad faith. Id. at 17– 18 19 20 21 20. The Court will consider Protingent’s alternative arguments. A. Protingent is Entitled to Recover Attorney’s Fees Under the Terms of the Plan. As the Court previously found, Protingent is entitled to recover its attorney’s fees under 22 the terms of the Plan. See Dkt. No. 80 at 11 (citing Dkt. No. 70-1 at 78 (“By accepting [benefits 23 from the plan], you also agree to pay all attorneys’ fees the plan incurs in successful attempts to 24 recover amounts the plan is entitled to under this section.”)). 25 26 27 “Once a party is found eligible for fees, the district court must then determine what fees are reasonable.” Klein v. City of Laguna Beach, 810 F.3d 693, 698 (9th Cir. 2016). The court first ORDER - 2 1 applies the two-step lodestar method, which requires the court to: (1) calculate the lodestar figure 2 by multiplying “the number of hours reasonably expended on a case by a reasonable hourly rate[,]” 3 4 5 6 in the context of “the prevailing market rate in the relevant community[;]” and (2) consider whether to adjust the lodestar figure “based on a variety of factors” not considered in calculating the lodestar figure. Roberts v. City of Honolulu, 938 F.3d 1020, 1023–24 (9th Cir. 2019) (cleaned up). 7 In this case, Protingent’s counsel includes three attorneys, two associates and one partner 8 at the same law firm. See Dkt. No. 82 ¶¶ 2–4, 6. All three attorneys agreed to litigate this case at 9 a reduced hourly rate, and the associates took on the majority of the work performed to avoid 10 11 12 13 14 billing at the partner’s higher rate. Id. ¶¶ 2–4. Associate Joshua Howard expended 212.4 hours at a reduced rate of $295/hour, associate Maria Hodgins expended 10.3 hours at a reduced rate of $210/hour, and partner Medora Marisseau expended 5.3 hours at a reduced rate of $345/hour. See id., Dkt. No. 82-1. 15 The Court finds that these hourly rates are reasonable in the context of Seattle litigation 16 counsel, even when compared to rates that were found reasonable more than a decade ago. See, 17 e.g., Nat’l Prod., Inc. v. Aqua Box Prod., LLC, No. 12-605-RSM, 2013 WL 12106900, at *2 (W.D. 18 19 20 21 Wash. Mar. 15, 2013) (finding $465–485/hour for partners and $205–300/hour for associates to be reasonable rates for Seattle attorneys in 2013). The Court also finds that the number of hours expended by counsel is reasonable. This 22 case has been pending for longer than three years and has involved significant motions practice. 23 The Court’s review of the time report spreadsheet provided by Protingent’s counsel does not reveal 24 any entries for excessive, redundant, or otherwise unnecessary billing. See Dkt. No. 82-1. 25 26 27 Multiplying counsel’s rates by the hours expended results in a lodestar figure of $66,676.00. See Dkt. No. 82-1 at 9. Protingent’s counsel does not request an adjustment to the ORDER - 3 1 lodestar figure, and the Court finds no reason to depart from the presumptively reasonable fee 2 amount here. Van Gerwen v. Guarantee Mut. Life Co., 214 F.3d 1041, 1045 (9th Cir. 2000) (“The 3 4 5 lodestar amount is presumptively the reasonable fee amount[.]”). B. 6 7 8 9 10 Protingent is Also Entitled to a Discretionary Award of Attorney’s Fees Under 29 U.S.C. § 1132(g), but the Court Declines to Award Prejudgment Interest. As referenced above, Protingent also requests an award of attorney’s fees and costs under 29 U.S.C. § 1132(g), as an alternative to its request for fees and costs under the terms of the Plan. A court has discretion to award reasonable attorney’s fees and costs to either party in an action brought by a participant in an Employee Retirement Income Security Act of 1974 (“ERISA”) plan. 11 See 29 U.S.C. § 1132(g). In exercising that discretion, courts should consider the following 12 factors: 13 14 15 16 17 18 19 20 21 (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 v. S.E. Rykoff & Co., 634 F.2d 446, 453 (9th Cir. 1980). Applying the Hummel factors to this case leads the Court to conclude that Protingent is entitled to a discretionary fee award under 29 U.S.C. § 1132(g). The first, third, and fifth Hummel factors support an award of fees because a review of the docket in this case reveals that Gustafson- 22 Feis did not act in good faith in pursuing a litigation position not supported by facts or law, an 23 award of fees would deter others from frivolous challenges to subrogation rights under ERISA 24 plans, and Protingent’s position was well-supported under the relevant legal authorities. The 25 fourth Hummel factor also supports an award of fees because enforcement of the Plan’s 26 27 subrogation rights allows the Plan “to defray costs, costs that would undoubtedly need to be passed ORDER - 4 1 to plan beneficiaries if subrogation was deemed unenforceable.” Swire Pac. Holdings, Inc. v. 2 Jones, No. C19-1329-RSM, 2020 WL 7059235, at *1 (W.D. Wash. Dec. 2, 2020) (cleaned up). 3 4 5 6 The second Hummel factor weighs against an award of fees, however, because Gustafson-Feis has limited ability to satisfy an award of fees. See, e.g., Dkt. No. 9-21 (detailing Gustafson-Feis’s “catastrophic financial loss” she suffered after the injury that gave rise to the funds expended on 7 her behalf, which are the subject of this lawsuit). Protingent has not argued to the contrary as to 8 the second Hummel factor. See Dkt. No. 69 at 18–20. 9 10 11 12 As summarized here, most of the Hummel factors suggest that Protingent is entitled to a discretionary award of attorney’s fees under 29 U.S.C. § 1132(g), and the Court thus finds that on either ground advanced by Protingent, Protingent is entitled to recover its attorney’s fees. To the extent that Protingent also requests an award of prejudgment interest (Dkt. No. 81 13 14 at 5–6), however, in consideration of Gustafson-Feis’s limited ability to satisfy an award, the Court 15 exercises its discretion to deny Protingent’s request for prejudgment interest. See Landwehr v. 16 DuPree, 72 F.3d 726, 739 (9th Cir. 1995) (“Whether to award prejudgment interest to an ERISA 17 plaintiff is ‘a question of fairness, lying with the court’s sound discretion, to be answered by 18 19 20 balancing the equities.’” (quoting Shaw v. Int’l Ass’n of Machinists & Aerospace Workers Pension Plan, 750 F.2d 1458, 1465 (9th Cir. 1985))). II. 21 COSTS 22 Protingent requests $559.70 in costs, to account for messenger services and court fees. See 23 Dkt. No. 82-2. Protingent is directed to file a bill of costs with the clerk of Court. See Local Rules 24 W.D. Wash. LCR 54. 25 // 26 27 // ORDER - 5 1 2 3 4 5 6 III. CONCLUSION The Court hereby GRANTS IN PART and DENIES IN PART Plaintiff’s motion for attorney’s fees, costs, and interest. Dkt. No. 81. It is hereby ORDERED that Plaintiff is entitled to an award of $66,676.00 from Defendant Lisa Gustafson-Feis, representing the reasonable attorney’s fees incurred by Plaintiff in recovering the $73,326.54 owed to the Plan. 7 The Court will issue a separate judgment, and post-judgment interest is set at a rate equal 8 to the weekly average 1-year constant maturity Treasury yield as published by the Board of 9 Governors of the Federal Reserve System for the calendar week preceding entry of judgment under 10 11 12 28 U.S.C. § 1961(a). IT IS SO ORDERED this 26th day of March, 2024. 13 14 A 15 Kymberly K. Evanson United States District Judge 16 17 18 19 20 21 22 23 24 25 26 27 ORDER - 6

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