Riggle et al v. The Marshall County Coal Company et al
Filing
44
MEMORANDUM OPINION AND ORDER GRANTING 11 DEFENDANT THE MARSHALL COUNTY COAL COMPANY'S MOTION TO DISMISS AND DIRECTING THE PLAINTIFFS TO FILE A MOTION AS TO COSTS AND REASONABLE ATTORNEY'S FEES. The plaintiffs' complaint is DISMISSED AS MOOT. The plaintiffs are hereby DIRECTED to file a formal motion for costs and reasonable attorney's fees by August 10, 2016. The defendants may file a response in opposition by August 24, 2016, and the plaintiffs may then file a reply in support by August 31, 2016. The Clerk is DIRECTED to enter judgment on this matter. Signed by Senior Judge Frederick P. Stamp, Jr. on 7/26/2016. (copy to counsel via CM/ECF) (nmm)
IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF WEST VIRGINIA
JENNIFER KAY RIGGLE and
BRITTNI ANN RICE,
Plaintiffs,
v.
Civil Action No. 5:15CV169
(STAMP)
THE MARSHALL COUNTY COAL COMPANY,
TRUSTEES OF THE UMWA RETIREMENT FUND
and BLUE CROSS BLUE SHIELD PPO PROGRAM,
MURRAY AMERICAN ENERGY, INC. PLAN 107,
Defendants.
MEMORANDUM OPINION AND ORDER
GRANTING DEFENDANT THE MARSHALL COUNTY
COAL COMPANY’S MOTION TO DISMISS AND
DIRECTING THE PLAINTIFFS TO FILE A MOTION
AS TO COSTS AND REASONABLE ATTORNEY’S FEES
I.
Background
The plaintiffs originally filed this action in the Circuit
Court of Marshall County, West Virginia.
Plaintiff Jennifer Kay
Riggle (“Riggle”) is an employee of defendant The Marshall County
Coal Company (“MCCC”).
herself
and
her
Plaintiff Riggle seeks benefits for both
same-sex
spouse,
plaintiff
Brittni
Ann
Rice
(“Rice”), as a dependent spouse under MCCC’s employee benefit plan.
According to the complaint, MCCC has refused to enroll plaintiff
Rice as a dependent spouse.
The plaintiffs allege that defendants
Blue Cross Blue Shield PPO Program, Murray American Energy, Inc.
Plan 107 (“Blue Cross”) and the Trustees of the UMWA Retirement
Fund (“Trustees”) administer the benefit plan at issue.
After removing this civil action, the Trustees filed a motion
to dismiss, or in the alternative, to stay.
ECF No. 11.
In that
motion, defendant Trustees argues that the plaintiffs have not
exhausted
their
administrative
remedies
under
the
Collective
Bargaining Agreement (“CBA”). Therefore, the Trustees request that
their motion be granted, or alternatively, that the action be
stayed while the parties pursue the Resolution of Dispute (“ROD”)
process found under the CBA.
Blue Cross and MCCC filed motions to
join in the Trustees’ motion to dismiss, which this Court granted.
ECF Nos. 13 and 14.
The plaintiffs then filed a response to the motion to dismiss.
ECF No. 18.
The plaintiffs contend that plaintiff Riggle received
inadequate notice as to the ROD process.
The plaintiffs believe
that the exhaustion requirement under the benefit plan has been
waived, and that arbitration in this case would require more time
than normal litigation.
arbitration
would
unconscionable.
be
Finally, the plaintiffs assert that
futile,
and
that
Finally, MCCC filed a reply.
the
process
ECF No. 23.
is
MCCC
contends that the resolution of dispute process is “neither futile
nor unfair and, at all relevant times, provided plaintiff Riggle
with sufficient notice of the process at issue.”
After the parties fully briefed the motion to dismiss, they
filed a joint motion to stay the civil action so that the parties
could pursue the ROD process.
ECF No. 22.
2
This Court granted that
motion.
ECF No. 24.
Ninety days later, the Trustees filed a
notice regarding the status of the ROD process.
ECF No. 25.
In
that notice, the Trustees stated that the arbitrator determined
that “the Employer is required to offer spousal health benefits to
the same-sex spouses of [Employer Benefit] [P]lan participants.”
See id. Ex. A.
This Court then lifted the stay in this action, and
permitted the plaintiffs to file a response to the Trustees’
notice.
ECF No. 27.
The plaintiffs filed a response to the
notice. ECF No. 28. The plaintiffs stated that the defendants had
not tendered “an official statement” that they will follow the
arbitrator’s decision.
They further sought full payment under the
benefit plan and requested attorney’s fees and costs. The Trustees
then filed a reply.
ECF No. 29.
In that reply, the Trustees
pointed out that they administer health benefits to retired coal
mineworkers and their eligible spouses.
As to active mineworkers,
which is the case here, the mineworker’s signatory employer would
administer such benefits.
On July 6, 2016, the parties appeared before this Court for a
hearing regarding the Trustees’ pending motion to dismiss as joined
by
the
other
defendants.
At
that
hearing,
counsel
for
the
plaintiffs withdrew their claims in their complaint as to defendant
Highmark, Inc., which the parties note was incorrectly named in the
complaint as Blue Cross (“Highmark/Blue Cross”).
not object to such withdrawal.
The parties did
This Court approved the withdrawal
3
of the plaintiffs’ claims against Highmark/Blue Cross, and the
motion to dismiss by Highmark/Blue Cross and its motion to join in
the motion to dismiss or motion to stay by the Trustees was granted
as to defendant Highmark/Blue Cross.
MCCC’s motion to join in the
motion to dismiss or stay by the Trustees (ECF No. 14) also was
granted.
After the hearing, the plaintiffs filed a notice of no
opposition to the dismissal of the Trustees, which this Court
accepted.
ECF No. 42.
Therefore, the motion to dismiss remains pending only as to
MCCC.
For the reasons set forth below, MCCC’s motion to dismiss
(ECF No. 11) is GRANTED.
The plaintiffs are hereby DIRECTED to
file a formal motion for costs and reasonable attorney’s fees by
August 10, 2016.
The defendants may file a response in opposition
by August 24, 2016, and the plaintiffs may then file a reply in
support by August 31, 2016.
II.
Applicable Law
In assessing a motion to dismiss for failure to state a claim
under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a
court must accept all well-pled facts contained in the complaint as
true.
Nemet Chevrolet, Ltd v. Consumeraffairs.com, Inc, 591 F.3d
250, 255 (4th Cir. 2009). However, “legal conclusions, elements of
a cause of action, and bare assertions devoid of further factual
enhancement fail to constitute well-pled facts for Rule 12(b)(6)
purposes.”
Id. (citing Ashcroft v. Iqbal, 129 S. Ct. 1937, 1949
4
(2009)).
This
Court
also
declines
to
consider
“unwarranted
inferences, unreasonable conclusions, or arguments.”
Wahi v.
Charleston Area Med. Ctr., Inc., 562 F.3d 599, 615 n.26 (4th Cir.
2009).
It has often been said that the purpose of a motion under Rule
12(b)(6) is to test the formal sufficiency of the statement of the
claim for relief; it is not a procedure for resolving a contest
about the facts or the merits of the case.
5B Charles Alan Wright
& Arthur R. Miller, Federal Practice and Procedure § 1356 (3d ed.
1998).
The Rule 12(b)(6) motion also must be distinguished from a
motion for summary judgment under Federal Rule of Civil Procedure
56, which goes to the merits of the claim and is designed to test
whether there is a genuine issue of material fact.
Id.
For
purposes of the motion to dismiss, the complaint is construed in
the
light
essentially
most
the
favorable
court’s
to
the
inquiry
party
is
making
directed
the
to
claim
and
whether
the
allegations constitute a statement of a claim under Federal Rule of
Civil Procedure 8(a).
Id. § 1357.
A complaint should be dismissed “if it does not allege ‘enough
facts to state a claim to relief that is plausible on is face.’”
Giarratano v. Johnson, 521 F.3d 298, 302 (4th Cir. 2008) (quoting
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “Facial
plausibility is established once the factual content of a complaint
‘allows the court to draw the reasonable inference that the
5
defendant is liable for the misconduct alleged.’” Nemet Chevrolet,
591 F.3d at 256 (quoting Iqbal, 129 S. Ct. at 1949).
Detailed
factual allegations are not required, but the facts alleged must be
sufficient “to raise a right to relief above the speculative
level.”
Twombly, 550 U.S. at 555.
III.
Discussion
A. The Motion to Dismiss Should Be Granted Because the Plaintiffs’
Claim Is Now Moot
As indicated earlier, the plaintiffs sought the following
under their complaint:
[A]n order of this Court requiring Defendants to admit
[plaintiff Rice] as a spouse, and to cease their policy
of refusing to provide her benefits, and to provide other
benefits, including but not limited to bereavement leave,
related to same-sex, related to same-sex spouses, as well
as other damages, both legal and equitable, such as
disgorgement of any profits made from its policy and
repayment of bills that would otherwise have been paid by
the Plans, as the court or jury may deem appropriate.
Plaintiffs also seek their fees and costs associated with
this action.
ECF No. 1 Ex. A *5.
At the time of filing the complaint, the
parties had not fully engaged in the ROD process, as set forth in
the CBA.
On February 4, 2016, which was over one month after the
defendants removed the action, the parties filed a joint motion to
stay this civil action.
motion.
ECF No. 24.
ECF No. 22.
This Court granted that
The ROD process concluded on May 18, 2016, at
which time the arbitrator found in favor of the plaintiffs.
In
particular, the arbitrator concluded that MCCC “is required to
6
offer spousal health benefits to the same-sex spouses of plan
participants.”
ECF No. 25 Ex. B.
The defendants filed a notice of
the result of the ROD process.
This Court lifted the stay and directed the parties to respond
and reply to the notice, to which the parties complied.
27, 28, 29, 35 (respectively).
ECF Nos.
Moreover, this Court conducted a
hearing as to the pending motions to dismiss. At that hearing, the
parties did not appear to dispute whether the plaintiffs received
the benefits they sought under the complaint.
Rather, it appears
that the arbitrator’s ruling has been complied with by MCCC, which
was the relief sought under the complaint.
Therefore, it appears
that the plaintiffs’ claim against MCCC is now moot.
See Doe v.
Kidd, 501 F.3d 348, 354 (4th Cir. 2007) (“A case is moot when the
issues presented are no longer live or the parties lack a legally
cognizable interest in the outcome.”) (citing Powell v. McCormack,
395 U.S. 486 (1969)); Otter Point Development Corp. V. United
States Army Corps. of Engineers, Baltimore Dist., 116 F. Supp. 2d
648, 651 (D. Md. 2000) (“Pursuant to Article III of the United
States
Constitution,
federal
courts
lack
subject
matter
jurisdiction to decide moot cases.”) (citing Iron Arrow Honor
Society v. Heckler, 464 U.S. 67, 70 (1983)).
point to any facts to the contrary.
The parties do not
Accordingly, the motion to
dismiss as to MCCC (ECF No. 11) is GRANTED and the plaintiffs’
complaint is DISMISSED AS MOOT.
7
This Court’s ruling, however, does not limit or prohibit the
parties from seeking costs and reasonable attorney’s fees in an
appropriate amount.
As to costs and reasonable attorney’s fees,
this Court will briefly turn to that potential issue.
B.
The Plaintiffs May Seek Costs and Reasonable Attorney’s Fees
Although
the
plaintiffs
requested
costs
and
reasonable
attorney’s fees in both their complaint and response to the notice
regarding the ROD process, the plaintiffs have not filed a separate
motion for costs and reasonable attorney’s fees.
and 28 at *7.
ECF Nos. 1 Ex. A
Moreover, the parties have not fully briefed that
issue as the request currently stands.
Nonetheless, counsel for the plaintiffs ultimately succeeded
in
obtaining
relief
for
the
plaintiffs.
Under
29
U.S.C.
§ 1132(g), district courts have discretion to award reasonable
attorney’s fee and costs of an action to either party. Further, in
determining whether to award costs and reasonable attorney’s fees
under that statute, this Court must first determine whether the
plaintiffs
achieved
“some
degree
of
success
on
the
merits.”
Williams v. Metro. Life Ins. Co., 609 F.3d 622, 634 (4th Cir.
2010).
A party satisfies this standard “if the court can fairly
call the outcome of the litigation some success on the merits”
without conducting a lengthy inquiry into whether the party’s
success was substantial or whether it occurred on a central issue.
8
Hardt v. Reliance Std. Life Ins. Co., 130 S. Ct. 2149, 2158 (2010)
(citing Ruckelshaus v. Sierra Club, 463 U.S. 680, 688 n.9 (1983)).
This Court finds that the plaintiffs achieved “some success on
the merits.”
In their complaint, the plaintiffs sought benefits
under MCCC’s employee benefit plan.
As stated earlier, the
plaintiffs have obtained such benefits from MCCC after completing
the ROD process.
Therefore, the plaintiffs obtained the relief
they sought, and thus, this Court finds that they clearly achieved
“some success on the merits.”
Accordingly, this Court is inclined
to award costs and reasonable attorney’s fees to the plaintiffs.
Before the issue of costs and reasonable attorney’s fees proceeds,
however, this Court will bring several points to the parties’
attention.
The United States Court of Appeals for the Fourth Circuit has
held that “ERISA attorney’s fees [are] categorically unavailable
for expenses incurred while exhausting administrative remedies.”
Rego v. Westvaco Corp., 319 F.3d 140, 150 (4th Cir. 2003) (citing
Cann v. Carpenter’s Pension Trust Fund for N. Cal, 989 F.2d 313,
316 (9th Cir. 1993); Anderson v. Procter & Gamble Co., 220 F.3d
449, 455 (6th Cir. 2000)).
Therefore, costs and reasonable
attorney’s fees are limited to those incurred during the litigation
in court, not during the ROD process.
In addition to the above limitation, this Court has only had
subject matter jurisdiction upon the completion of the ROD process
9
on May 18, 2016.
their
In particular, the plaintiffs in this case filed
complaint
remedies.
before
they
exhausted
their
administrative
The plaintiffs state in their complaint that both the
CBA does not require exhaustion and that exhaustion would be
futile.
The CBA does, however, contain an exhaustion requirement,
which the plaintiffs did not satisfy at the time they filed their
complaint.
See ECF No. 12 Ex. 12 *45.
The Fourth Circuit has
found that “an ERISA claimant generally is required to exhaust the
remedies
provided
by
the
employee
benefit
plan
in
which
he
participates as a prerequisite to an ERISA action for denial of
benefits under 29 U.S.C. § 1132.”
Makar v. Health Care Corp. Of
Mid-Atlantic (CareFirst), 872 F.2d 80, 82 (4th Cir. 1989).
More
importantly, “[a]bsent an applicable exemption, a district court
lacks subject matter jurisdiction over an ERISA-covered action
until administrative remedies are exhausted.”
Delong v. Teacher’s
Ins. and Annuity Ass’n, 2000 WL 426193, at *5 (E.D. Pa. Mar. 29,
2000) (citing Kennedy v. Empire Blue Cross & Blue Shield, 796
F.Supp. 764, 767 (S.D.N.Y. 1992)).
neither
exhausted
the
In this case, the plaintiffs
administrative
remedies
available
nor
demonstrated futility. Therefore, this Court lacked subject matter
jurisdiction until the ROD process, which is the administrative
remedy at issue, was resolved on May 18, 2016.
Thus, the only
costs and reasonable attorney’s fees which the plaintiffs may seek
are those that were incurred by plaintiffs after May 18, 2016.
10
With the above limitations in mind, this Court will proceed as
follows.
The plaintiffs are hereby DIRECTED to file a formal
motion for costs and reasonable attorney’s fees by August 10, 2016.
The defendants may file a response in opposition by August 24,
2016, and the plaintiffs may then file a reply in support by August
31, 2016.
Because the plaintiffs are eligible for an award of
attorney’s fees under Hardt, this Court will, upon a full briefing
of the issue of costs and reasonable attorney’s fees, proceed to
the second step of applying the factors under Quesinberry v. Life
Ins. Co. of N. Am., 987 F.2d 1017, 1029 (4th Cir. 1993) (en banc),
as a general guide to the determination of whether to award
attorney’s fees to the plaintiffs. Williams, 609 F.3d at 635. The
parties’ briefings as to costs and reasonable attorney’s fees
should address the factors under Quesinberry, which include the
following:
(1) degree
faith;
of
opposing
parties’
culpability
or bad
(2) ability of opposing parties to satisfy an award of
attorneys’ fees;
(3) whether an award of attorneys’ fees against the
opposing parties would deter other persons acting under
similar circumstances;
(4) whether the parties requesting attorneys’ fees
sought to benefit all participants and beneficiaries of
an ERISA plan or to resolve a significant legal question
regarding ERISA itself; and
(5)
the relative merits of the parties’ positions.
11
Quesinberry, 987 F.2d at 1029.
Furthermore, the parties must also consider in their briefings
that this Court must “determine a lodestar figure by multiplying
the number of reasonable hours expended times a reasonable rate.”
Robinson v. Equifax Info. Servs., LLC, 560 F.3d 235, 243 (4th Cir.
2009).
To determine what is a “reasonable” number of hours and a
“reasonable” rate, this Court must consider and make detailed
findings with regard to twelve factors, commonly known as the
Johnson factors.
Barber v. Kimbrell’s, Inc., 577 F.2d 216, 226
(4th Cir. 1978) (adopting the test from Johnson v. Georgia Highway
Express, Inc., 488 F.2d. 714, 717-19 (5th Cir. 1974)).
These
factors include:
(1) the time and labor expended; (2) the novelty and
difficulty of the questions raised; (3) the skill
required to properly perform the legal services rendered;
(4) the attorney’s opportunity costs in pressing the
instant litigation; (5) the customary fee for like work;
(6) the attorney’s expectations at the outset of the
litigation; (7) the time limitations imposed by the
client or circumstances; (8) the amount in controversy
and the results obtained; (9) the experience, reputation
and ability of the attorney; (10) the undesirability of
the case within the legal community in which the suit
arose; (11) the nature and length of the professional
relationship between attorney and client; and (12)
attorneys’ fees awards in similar cases.
Id. at n.28.
In summary, this Court believes that the plaintiffs have
achieved some degree of success on the merits, and therefore, this
Court is inclined to award costs and reasonable attorney’s fees to
the plaintiffs which the plaintiffs incurred after May 18, 2016.
12
Further, the parties’ briefings should proceed to address the
factors set forth in Quesinberry and Johnson, as stated above.1
IV.
Conclusion
For the reasons set forth above, defendant the Marshall County
Coal Company’s motion to dismiss (ECF No. 11) is GRANTED, and the
plaintiffs’ complaint is DISMISSED AS MOOT.
The plaintiffs are
hereby DIRECTED to file a formal motion for costs and reasonable
attorney’s fees by August 10, 2016.
The defendants may file a
response in opposition by August 24, 2016, and the plaintiffs may
then file a reply in support by August 31, 2016.
IT IS SO ORDERED.
The Clerk is DIRECTED to transmit a copy of this memorandum
opinion and order to counsel of record herein. Pursuant to Federal
Rule of Civil Procedure 58, the Clerk is DIRECTED to enter judgment
on this matter.
1
The Court notes that in their initial request for costs and
reasonable attorney’s fees, the plaintiffs sought such costs and
fees pursuant the “Catalyst Theory” of recovery.
However, as
pointed out by United States Magistrate Judge Susan K. Gauvey in
Feldman’s Medical Center Pharmacy, Inc. v. Carefirst, Inc., 898 F.
Supp. 2d 883, 897 (D. Md. 2012), it appears that “the Fourth
Circuit [has] yet to explicitly apply the “catalyst theory” in the
ERISA context.” Moreover, this Court has already found that the
plaintiffs have achieved “some success on the merits,” and is
inclined to award costs and reasonable attorney’s fees based on the
legal standards set forth under Quesinberry and Johnson.
Nonetheless, the parties may still address any potential recovery
under the “Catalyst Theory” in their briefings if they believe that
such theory is applicable in this case.
13
DATED:
July 26, 2016
/s/ Frederick P. Stamp, Jr.
FREDERICK P. STAMP, JR.
UNITED STATES DISTRICT JUDGE
14
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