In a ruling recently secured by DeBofsky Sherman & Casciari, P.C., a federal court definitively ruled that prevailing defendants in ERISA cases are rarely entitled to fees. In Geiger v. Aetna Life Ins. Co., 2016 WL 5391206 (N.D. Ill. September 27, 2016) (opinion), where a court upheld Aetna's termination of disability benefits (currently on appeal), the court denied the insurer's application for fees. Although the court acknowledged that under Hardt v. Reliance Standard Life Ins. Co., 560 U.S. 242, 244 (2010), either party is entitled to fees so long as the fee claimant has achieved "some degree of success on the merits," and also recognized "a 'modest presumption' in favor of awarding fees to the prevailing party, the court nonetheless refused to award fees to Aetna.
Attorney fee awards available under ERISA are a means of providing an incentive to counsel to agree to represent benefit claimants, while at the same time, fee awards create a deterrent against unjustified denials by benefit plan administrators. In Fontaine v. Metro.Life Ins.Co., 2014 U.S.Dist.LEXIS 75012, 2014 WL 2511091 (N.D.Ill. June 3, 2014)(copy available at http://www.debofsky.com/What-s-New.shtml), DeBofsky, Sherman & Casciari convinced a federal judge to reconsider her prior denial of fees in a case involving disability insurance benefits. Although an earlier ruling found the plaintiff was entitled judgment (2014 U.S.Dist.LEXIS 41253, 2014 WL 1258353 (N.D.Ill. March 27, 2014), the court had previously denied an award of fees, finding the defendant's position was "substantially justified." On reconsideration, the court acknowledged that it had originaly applied the wrong standard and determined that the plaintiff was indeed entitled to fees.