The Employee Retirement Income Security Act (ERISA) provides courts with discretionary authority to award reasonable attorney’s fees to parties who achieve “some degree of success on the merits” in benefits litigation. The recent decision in Daniel C. v. Chevron Corp., U.S. Dist. LEXIS 103623 (N.D. Cal. May 20, 2025) illustrates the evolving judicial approach to determining when a remand order constitutes sufficient success to warrant a fee award, while also demonstrating how courts balance limited victories against the remedial purposes of ERISA. This case provides valuable guidance for practitioners navigating the intersection of procedural victories and substantive success in ERISA litigation.

Factual Background and Procedural History

The Plaintiff in this case initially applied for short-term disability benefits due to major depressive disorder and occupational problems. After ReedGroup approved his initial claim from October through December 2017, the Plaintiff suffered a traumatic brain injury in a motor vehicle accident on December 31, 2017. ReedGroup subsequently approved extensions for short-term disability and granted long-term disability benefits from April 2, 2018 through June 30, 2020, totaling 27 months of coverage.

The critical juncture arose when ReedGroup denied the plaintiff’s continued long-term disability benefits starting July 1, 2020. Under the plan’s terms, employees must satisfy the usual occupation standard for the first 24 months, but thereafter must meet the more stringent “Any Occupation” standard to continue receiving benefits. On the parties’ cross-motions for summary judgment, the Court held that Chevron failed to demonstrate that it made a valid delegation of authority to ReedGroup and, thus, the Court would review ReedGroup’s denial of Plaintiff’s benefits de novo. However, as the parties agreed, the Court could not conduct a de novo review on a motion for summary judgment. Instead, the Court conducted that review at the bench trial. On the parties’ cross-motions for judgment under Federal Rule of Civil Procedure 52(a) the Court held that ReedGroup erred in failing to conduct a vocational analysis and remanded this case for further proceedings in accordance with that Order. While the Court ultimately concluded that ReedGroup erred and remanded Plaintiff’s claim for benefits for further review, the Court noted that the Order was not uniformly in favor of Plaintiff’s positions. The Court rejected Plaintiff’s argument that the Court should consider extra-record evidence. Thus, the Court’s review could not include the audiological evaluation by Dr. Samantha Nieves that was not part of the administrative record. The Court also rejected Plaintiff’s argument that Court could not consider medical documentation that ReedGroup did not specifically discuss, such as Plaintiff’s June 4, 2019 CT scan. Instead, the Court held that it must review all supporting medical documentation to determine whether ReedGroup correctly found it inadequate to show Plaintiff was disabled under the newly applicable “Any Occupation” standard.

Thus, the Court concluded that it could not determine whether Plaintiff meets the disability definition under the Plan without any vocational analysis and remanded Plaintiff’s claim to ReedGroup for an initial factual determination based on the record with additional vocational evidence. Plaintiff filed a motion for attorney’s fees and to amend the judgment to include an award of benefits pending ReedGroup’s determination of Plaintiff’s disability benefits on remand.

The Legal Standard for ERISA Attorney’s Fees

ERISA’s attorney’s fee provision, codified at 29 U.S.C. § 1132(g)(1), grants courts discretionary authority to award reasonable attorney’s fees to parties who demonstrate some degree of success on the merits Gross v. Sun Life Assurance Co. of Can., 880 F.3d 1 (1st Cir. 2018). The Supreme Court’s decision in Hardt v. Reliance Standard Life Insurance Co. established that fee claimants need not be prevailing parties in the traditional sense, but must achieve more than “trivial success on the merits or a purely procedural victory.” Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010).

As the Court explained in Daniel C., a party satisfies this requirement if the court can fairly call the outcome of the litigation some success on the merits without conducting a lengthy inquiry into the question whether a particular party’s success was substantial or occurred on a central issue. This standard reflects Congress’s failure to “abandon historic fee-shifting principles and intuitive notions of fairness” in drafting the ERISA fee provision Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242 (2010).

Remand as Success on the Merits

The Daniel C. court joined the growing consensus of federal courts that recognize remand orders as constituting success on the merits under the Hardt standard. The court noted that most courts have, in the wake of Hardt determined that a remand to a plan administrator – by itself – does in fact constitute some success on the merits. This conclusion aligns with decisions which found that a remand for further administrative proceedings is not a trivial success where it is based on a court determination that ERISA rights were violated.

The court’s analysis focused on whether the remand represented a meaningful benefit to the fee-seeker rather than a mere procedural victory. In this case, the court determined that the reversal of the determination of denial and the remand for consideration with a vocational analysis constitutes a sufficient degree of success to warrant attorney’s fees. This holding reflects the practical reality that remand orders often provide plaintiffs with renewed opportunities to obtain benefits that were previously denied.

Application of the Hummell Factors

For cases where a party achieves some success but does not prevail completely courts apply the five-factor analysis established in Hummell v. S.E. Rykoff & Co., 634 F.2d 446, 453 (9th Cir. 1980). These factors examine: (1) the opposing parties’ culpability or bad faith; (2) their ability to satisfy a fee award; (3) whether an award would deter similar conduct; (4) whether the requesting party sought to benefit all plan participants or resolve significant ERISA questions; and (5) the relative merits of the parties’ positions.

The Ninth Circuit has emphasized that application of the Hummell actors must recognize the remedial purpose of ERISA in favor of participants and beneficiaries in cases where participants must resort to litigation to recover wrongfully withheld benefits. While the Daniel C. court did not extensively analyze each Hummell factor, the decision to award fees suggests that these considerations supported the Plaintiff’s position, particularly given ERISA’s participant-protective purposes.

Limited Success and the Fifty Percent Reduction

Despite finding that the remand constituted success on the merits, the court significantly reduced the Plaintiff’s fee award, cutting the lodestar amount by fifty percent. The court applied the framework, which requires courts to consider whether the plaintiff failed to prevail on unrelated claims and whether the level of success makes the hours expended a satisfactory basis for a fee award.

The Court found that while there were no unrelated claims in the case, Plaintiff’s success was limited. Specifically, the court noted that it “only remanded on the narrow issue of requiring a vocational analysis” and that the “Plaintiff was unable to demonstrate that the medical evidence established that he was disabled.” The Court emphasized that it did not find that defendant “engaged in any egregious or obviously inappropriate conduct” and that the determination requiring a vocational analysis “was not a foregone conclusion based on the facts of this case.”

This reduction reflects the Court’s calibration of fee awards to match the degree of success achieved. The Court awarded a total of $92,463.75 in attorney’s fees, representing exactly half of the original lodestar calculation of $184,927.50. The Court found the requested hourly rates of $600 and $850 reasonable, as well as the total hours expended.

Broader Implications for ERISA Litigation

The Daniel C. decision contributes to the developing body of law recognizing that remand orders can constitute meaningful success under ERISA’s fee-shifting provision. This trend encourages vigorous enforcement of ERISA’s protections by ensuring that participants who successfully challenge flawed benefit determinations can recover their legal costs, even when they do not obtain immediate benefit awards.

However, the Court’s fifty percent reduction demonstrates judicial awareness of the need to calibrate fee awards appropriately. Courts must balance ERISA’s remedial purposes against the risk of excessive fee awards for limited victories. The Daniel C. approach suggests that while remand orders generally satisfy the Hardt standard, the scope and significance of the remand will influence the ultimate fee calculation. While the fifty percent reduction reflects the limited nature of the plaintiff’s success, the underlying fee award validates the importance of vigorous advocacy in ERISA benefits litigation and supports the statute’s participant-protective purposes. Future courts will likely continue to grapple with the appropriate balance between encouraging ERISA enforcement and ensuring that fee awards remain proportionate to the success achieved.