On October 14, 2020, Judge Janis L. Sammartino of the Southern District of California ruled in favor of McKennon Law Group PC’s client in her motion for attorneys’ fees and costs arising out of an ERISA disability lawsuit against Aetna Life Insurance Company. Our client, a former senior vice president at a major retailer, became disabled as a result of her numerous medical conditions which include chronic pain syndromes, neurological deficits, spinal problems, deterioration of high-level cognitive functioning and gastrointestinal issues. She has a long-term disability policy with Aetna. After paying two years’ worth of benefits, Aetna terminated our client’s claim for disability benefits. After pursuing her administrative appeals, our client sued Aetna to obtain the benefits she was owed. We convinced Aetna to reinstate our client’s benefits. When it was discovered that Aetna had improperly deducted our client’s worker’s compensation benefits from her payments of disability benefits, we convinced Aetna that it had erred and to pay our client the withheld funds. However, Aetna still refused to pay our client’s attorneys’ fees and costs. We filed a motion for the fees and costs.
In ruling on the motion, Judge Sammartino rejected a variety of Aetna’s arguments as to why it should not pay our client’s attorneys’ fees and costs. For example, Judge Sammartino explained that, even though she had not ruled on the merits of the claim, our client’s lawsuit prompted Aetna to reinstate our client’s benefits and, under a “catalyst theory of success,” our client had demonstrated success on the merits of the case, a key factor in establishing entitlement to an award of attorneys’ fees. Judge Sammartino also rejected Aetna’s arguments that our client’s attempts to augment the administrative record before suing Aetna were not compensable as part of the litigation. As Judge Sammartino explained, the attempts to augment the record served as a demand letter related to litigation and were not part of the administrative appeals process. The awarding of fees for this additional time significantly increased the value of the award of fees.
We had several strategic victories along the way that contributed to this favorable result. Not only did we convince Aetna to reinstate our client’s benefits, but we also successfully rebutted several attempts by Aetna to acquire a copy of our fee agreement with our client. Whereas fee agreements are discoverable under certain circumstances, they are completely irrelevant to an award of fees under ERISA. See Van Gerwen v. Guarantee Mut. Life Co., 214 F.3d 1041, 1048 (9th Cir. 2000); Welch v. Metropolitan Life Insurance Co., 480 F.3d 942, 946 (9th Cir. 2007). Not only did successfully denying Aetna access to the fee agreement deny Aetna access to additional arguments as to why the fees should be reduced, but the time arguing that issue was compensable when we filed our motion for fees.
The Court ordered Aetna to pay our client 80% of her requested fees and costs, $182,869.82. This was the final piece of a very successful case.