Hardt v. Reliance Standard Life Ins. Co.

PETITIONER: Bridget Hardt
RESPONDENT: Reliance Standard Life Insurance Co.
LOCATION:

DOCKET NO.: 09-448
DECIDED BY: Roberts Court (2009-2010)
LOWER COURT: United States Court of Appeals for the Fourth Circuit

CITATION: 560 US 242 (2010)
GRANTED: Jan 15, 2010
ARGUED: Apr 26, 2010
DECIDED: May 24, 2010

ADVOCATES:
John R. Ates - for the petitioner
Nicholas Q. Rosenkranz - on behalf of the respondent
Pratik A. Shah - Assistant to the Solicitor General, Department of Justice, for the United States, as amicus curiae, supporting the petitioner

Facts of the case

A Virginia federal district court remanded Bridget Hardt's claim for long-term disability benefits from Reliance Standard Life Insurance ("Reliance"). The court asked Reliance to reconsider its denial of Ms. Hardt's claim. Upon remand and after Ms. Hardt presented new evidence, Reliance changed its earlier stance and awarded Ms. Hardt full long-term disability benefits. Ms. Hardt then filed a motion for attorneys' fees based on her status as a prevailing party. The district court granted her motion and awarded her $39,149 in fees.

On appeal, Reliance argued that Ms. Hardt was not a "prevailing party" as understood by the Employee Retirement Income Security Act and thus was not eligible for an award of attorneys' fees. The U.S. Court of Appeals for the Fourth Circuit agreed and reversed the district court. The court held that the district court's decision to remand Ms. Hardt's claim to Reliance did not constitute an enforceable judgment that Ms. Hardt prevailed on her claim because Reliance could have decided to deny her coverage.

Question

1) Did the Fourth Circuit err in holding that ERISA Section 502(g)(1) provides a district court discretion to award reasonable attorneys' fees only to a prevailing party?

2) Is a party entitled to attorneys' fees pursuant to Section 502(g)(1) when the party persuades a district court that an ERISA violation has occurred, successfully secures a judicially ordered remand requiring redetermination of entitlement benefits, and receives the benefits sought on remand?

Media for Hardt v. Reliance Standard Life Ins. Co.

Audio Transcription for Oral Argument - April 26, 2010 in Hardt v. Reliance Standard Life Ins. Co.

Audio Transcription for Opinion Announcement - May 24, 2010 in Hardt v. Reliance Standard Life Ins. Co.

John G. Roberts, Jr.:

Justice Thomas has our Opinion today in case 09-448, Hardt's versus Reliance Standard Life Insurance Company and he has asked that I announce the opinion.

This case comes to us on writ of certiorari to the United States Court of Appeals for the Fourth Circuit.

Petitioner Bridget Hardt's sued respondent Reliance Standard Life Insurance Company after it denied her request for long-term disability benefits under a plan governed by the Employee Retirement Income Security Act of 1974 known as ERISA.

Hardt and Reliance filed cross-motions for summary judgment.

The District Court denied both motions but found that Reliance had failed to give Hardt's a claim, the full and fair review that ERISA requires.

The District Court instructed Reliance to conduct a proper review of Hardt's Claim within 30 days and warned that if Reliance failed to do so, the Court would enter judgment in Hardt's favor.

After Reliance conducted the review as instructed, it awarded Hardt the long-term disability benefits she sought.

Hardt then moved the court to award her attorney's fees under 29 United States code section 1132 (g)1, a fee shifting statute that gives Courts discretion to award attorney's fees to either party" in most ERISA lawsuits.

The District Court granted Hardt's motion for fees but the Court of Appeals vacated that judgment concluding that Hardt was not eligible for fees under the statute because the District Court's order instructing Reliance to reconsider Hardt's benefit claim did not make Hardt a prevailing party.

In an opinion filed with the Clerk today, we reverse the judgment of the Court of Appeals.

The term Prevailing Party is a legal term of art, that does not appear in section 1132 (g)1.

The Court of Appeals thus erred in holding that Hardt had to qualify as a prevailing party to receive a fee award.

Applying the interpretive method we employed in a case called Ruckelshaus versus Sierra Club, we conclude that a fee claimant is eligible for attorney's fees under the statute as long as she has achieved some degree of success on the merits of her claim.

Once the claimant has established eligibility for a fee award the District Court has broad discretion to award fees under section 1132 (g)1.

As more fully explained in our opinion, we conclude that Hardt established her eligibility for fees award and that the Court of Appeals erred by vacating the District Court's judgment.

Justice Stevens has filed an opinion concurring in part and concurring in the judgment.