Reversed by Supreme Court, May 24, 2010
UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
No. 08-1896
BRIDGET HARDT,
Plaintiff − Appellee,
v.
RELIANCE STANDARD LIFE INSURANCE COMPANY,
Defendant – Appellant,
and
DAN RIVER GROUP LONG−TERM DISABILITY PLAN,
Defendant.
Appeal from the United States District Court for the Eastern
District of Virginia, at Norfolk. Jerome B. Friedman, District
Judge. (2:07-cv-00105-JBF-JEB)
Argued: March 25, 2009 Decided: July 14, 2009
Before WILLIAMS, Chief Judge, 1 WILKINSON, Circuit Judge, and
David A. FABER, Senior United States District Judge for the
Southern District of West Virginia, sitting by designation.
1
Chief Judge Williams heard oral argument in this case but
did not participate in the decision. The decision is filed by a
quorum of the panel pursuant to 28 U.S.C. § 46(d).
Vacated by unpublished per curiam opinion.
ARGUED: Joshua Bachrach, WILSON, ELSER, MOSKOWITZ, EDELMAN &
DICKER, LLP, Philadelphia, Pennsylvania, for Appellant. Ann
Sullivan, CRENSHAW, WARE & MARTIN, PLC, Norfolk, Virginia, for
Appellee. ON BRIEF: Elaine Kathryn Inman, CRENSHAW, WARE &
MARTIN, PLC, Norfolk, Virginia, for Appellee.
Unpublished opinions are not binding precedent in this circuit.
2
PER CURIAM:
Reliance Standard Life Insurance Company (“Reliance”)
appeals an award of attorney’s fees to Bridget Hardt, arguing
that the district court’s remand of Hardt’s claim for long-term
disability benefits to Reliance for additional consideration did
not make Hardt a prevailing party for purposes of an attorney’s
fees award. We agree, and for the reasons below, we vacate the
award of attorney’s fees to Hardt.
I.
In 2000, Hardt was employed as an executive assistant to
the president of Dan River Inc., a textile manufacturer. During
that year, Hardt began experiencing pain in her neck and
shoulders; she was diagnosed with carpal tunnel syndrome ("CTS")
and underwent surgery on both of her wrists. Hardt continued
experiencing pain, however, and stopped working on January 23,
2003.
In August 2003, Hardt requested that Reliance pay her long-
term disability benefits pursuant to Dan River Inc.’s Group
Long-Term Disability Insurance Program Plan (“the Plan”).
Pursuant to the terms of the Plan, Dan River administers the
Plan, but Reliance underwrites the Plan and decides whether a
particular individual is entitled to benefits. In response to
Hardt’s request, Reliance notified Hardt that she was required
3
to submit to a functional capacities evaluation ("FCE") and
granted her a provisional approval.
Hand Rehabilitation of Hampton Roads administered the FCE
to Hardt in October 2003. The evaluator concluded that Hardt
suffered the following major limitations: neck and upper
extremity pain, decreased right hand dexterity and strength,
restricted overhead reach, a restricted ability to squat and
kneel, the inability to crawl or to climb ladders, and decreased
lift, carrying, and push and pull capabilities. In December
2003, Reliance denied Hardt’s claim, concluding that she did not
meet the Plan’s definition of total disability. Pursuant to the
terms of the Plan, Hardt appealed this decision, and Reliance
reversed its original decision so that Hardt ultimately received
temporary disability benefits for twenty-four months.
In the meantime, Hardt was also diagnosed with hereditary
small-fiber neuropathy, 2 and her pain became worse over the
following months. In addition to other symptoms, Hardt
experienced burning sensations in her feet and pain in her
calves, making walking difficult.
2
Small-fiber neuropathy is a disorder involving small
sensory cutaneous nerves. Symptoms include tingling; numbness;
burning pain or extreme coldness; brief, painful sensations; and
loss of temperature sensation.
4
Hardt applied to the Social Security Administration ("SSA")
for disability insurance benefits and submitted two
questionnaires completed by her treating physicians that
concluded she could not return to her prior position or other
sedentary positions because of her neuropathy and other
maladies. The SSA found that Hardt was "disabled" under the
Social Security Act because she was unable to return to her
former employment or make an adjustment to perform other work.
A few months later, Reliance notified Hardt that her
benefits would expire at the end of the twenty-four month
period. The Plan provided benefits after twenty-four months only
to individuals totally disabled from all occupations. Reliance,
having reviewed the medical documentation in Hardt’s file and a
Residual Employability Analysis that found she had several
employment opportunities still available, found that Hardt was
not totally disabled under the Plan.
Hardt again appealed this denial of her claim to Reliance
and, in support of her claim, submitted her medical records, the
SSA questionnaires completed by her treating physicians, and an
updated questionnaire from one of those physicians that again
opined Hardt would be unable to maintain a job. Reliance
requested that Hardt complete an updated FCE before making a
final decision on her claim, but did not request that the
testing company review Hardt for neuropathic pain.
5
Hardt underwent the updated FCE on December 29, 2005 and a
second updated FCE on January 26, 2006, but the results of both
examinations were considered invalid by the examiners because
Hardt's effort was submaximal. Specifically, one examiner noted
that Hardt "refused multiple tests . . . for fear of
nausea/illness/further pain complaints." (J.A. at 475.)
Reliance then hired Dr. Michael Leibowitz, who reviewed
only some of Hardt’s medical records. In his report, Dr.
Leibowitz does not mention any of the pain medications Hardt was
taking or the treating physicians’ questionnaires. Dr.
Leibowitz ultimately concluded that Hardt’s health was expected
to improve. Reliance also hired a vocational rehabilitation
counselor to determine if any jobs existed that Hardt could
perform. That labor market study identified eight employment
opportunities suitable for Hardt, but the study was based on
Hardt’s health in 2003.
On March 27, 2006, Reliance advised Hardt that, based on
its review of her file, she was still ineligible to receive
long-term disability benefits. Reliance’s decision was based on
the FCEs, Dr. Leibowitz’s report, and the labor market study.
Hardt exhausted her administrative remedies and filed a
complaint in the United States District Court for the Eastern
District of Virginia, alleging that Reliance violated ERISA by
wrongfully denying her long-term disability benefits. The
6
district court denied both parties’ motions for summary
judgment, but remanded Hardt’s claim to Reliance Standard for
reconsideration. In remanding Hardt’s claim, the district court
stated that if Reliance did not adequately consider all of the
evidence discussed in its opinion within 30 days of the date the
opinion was issued, “judgment will be issued in favor of Ms.
Hardt.” (J.A. at 65.)
On remand, Hardt provided additional medical records to
Reliance for its consideration, and Reliance ultimately reversed
its earlier decision and awarded Hardt full long-term disability
benefits until her sixty-sixth birthday, as well as retroactive
benefits for the time already elapsed. Hardt then filed a
motion for attorney’s fees and costs in the district court based
upon her status as the prevailing party. 3 See 29 U.S.C.A.
§ 1132(g)(1) (West 2009) (providing that “the court in its
discretion may allow a reasonable attorney’s fee and costs of
action to either party.). The district court granted her motion
on August 7, 2008, concluding that “the court sanctioned a
material change in the legal relationship of the parties by
3
This case was originally heard by the Honorable Walter D.
Kelley, who remanded the case back to Reliance for
reconsideration, and who resigned effective May 16, 2008. Upon
Judge Kelley’s resignation, the case was transferred to the
Honorable Jerome B. Friedman, who heard and ruled upon Hardt’s
motion for attorney’s fees.
7
ordering [Reliance] to conduct the type of review to which
[Hardt] was entitled,” and that because, “on remand, [Hardt]
received precisely the benefits she had sought, she meets the
definition of a ‘prevailing party’ and is eligible for an award
of attorneys’ fees.” (J.A. at 79.) The district court thus
awarded Hardt $39,149.00 in fees, and Reliance timely appealed.
We have jurisdiction pursuant to 28 U.S.C.A. § 1291 (West 2006).
II.
We review de novo the district court’s determination that
Hardt was a “prevailing party” for purposes of awarding
attorney’s fees. See Goldstein v. Moatz, 445 F.3d 747, 751 (4th
Cir. 2006) (performing de novo review of whether applicant for
attorney’s fees was a prevailing party under EAJA). 4
A.
It is well settled that “only a prevailing party is
entitled to consideration for attorneys’ fees in an ERISA
action.” Martin v. Blue Cross & Blue Shield of Va., Inc., 115
F.3d 1201, 1210 (4th Cir. 1997). To be a prevailing party, “a
plaintiff [must] receive at least some relief on the merits of
4
Fee-shifting provisions are generally interpreted
consistently. See Buckhannon Bd. & Care Home v. W. Va. Dep’t of
Health & Human Res., 532 U.S. 598, 603 n.4 (2001), and Griggs v.
E.I. DuPont de Nemours & Co., 385 F.3d 440, 454 (4th Cir. 2004)
(applying Buckhannon to ERISA claims).
8
his [or her] claim.” Buckhannon Bd. & Care Home, Inc. v. W. Va.
Dep’t of Health & Human Res., 532 U.S. 598, 603 (2001)).
“[E]ven an award of nominal damages suffices under this test.”
Id. at 604. The Supreme Court has, however, established a
bright-line boundary on what constitutes “relief on the merits”
of a particular claim: only “enforceable judgments on the merits
and court-ordered consent decrees create the material alteration
of the legal relationship of the parties necessary to permit an
award of attorney’s fees.” Buckhannon, 532 U.S. at 604
(internal quotation marks omitted).
In Goldstein, we clarified this Buckhannon standard by
holding that there is no exception for “tactical mooting” - the
situation where a defendant chooses to settle rather than risk
an award of attorney’s fees. Goldstein, 445 F.3d at 752.
Although Buckhannon does not specifically address tactical
mooting, we explained in Goldstein that “[t]he Supreme Court in
Buckhannon . . . did not leave the door ajar for an inferior
court to engraft a broad tactical mooting exception onto its
ruling . . . [and the Court instead] concluded that tactical
mooting concerns are simply insufficient to overcome the
statutory requirement that a party applying for a fees and costs
award must first have been accorded some relief in the district
court.” Id. In Goldstein, however, we left open the question
of “whether there is an exception to the Buckhannon rule where a
9
defendant has agreed to provide the relief requested in response
to an affirmative indication by the presiding court that the
plaintiff is about to prevail.” Id.
In this case, the district court determined that Hardt was
a prevailing party based upon a previous remand order. That
order denied both cross-motions for summary judgment but
required Reliance to reconsider Hardt’s claim within 30 days and
stated that if Reliance did not comply, “judgment will be issued
in favor of Ms. Hardt.” (J.A. at 65.) Although the district
court, reviewing the earlier remand order, noted that at the
time the case was remanded, it had been “inclined to reserve
judgment and permit [Reliance] to conduct a proper review of all
of the medical evidence” and explained that “[h]ad [Reliance]
completed its review in the manner ordered by the court and in
the prescribed time period, and again determined that [Hardt]
was not eligible for benefits, it is certainly possible that the
court would have found the result satisfactory,” (J.A. at 77),
the district court found Hardt to be a prevailing party because,
“on remand, [Hardt] received precisely the benefits she had
sought,” (J.A. at 79). As the district court explained, “[t]he
defendant, under threat of judgment against it, reversed its
decision and chose to award the plaintiff the precise relief she
was seeking.” (J.A. at 77.) In the district court’s view, this
10
“[c]learly” constituted “judicially sanctioned relief.” (J.A. at
77.)
B.
On appeal, Reliance contends that, at best, this is a case
of “tactical mooting” and that there was no enforceable judgment
on the merits or judicially sanctioned relief. We agree.
Hardt’s case presents a set of circumstances that, like those
presented in Goldstein, are “simply insufficient to overcome the
statutory requirement that a party applying for a fees and costs
award must first have been accorded some relief in the district
court.” Goldstein, 445 F.3d at 752.
Hardt attempts to fit her case within the question we left
open in Goldstein, but that opening provides her no relief.
Hardt’s case simply does not present the type of affirmative
indication contemplated by Goldstein. On remand, the district
court required Reliance to provide Hardt with an appropriate
review of her claim; it gave no indication that Hardt was “about
to prevail.” Id. Had Reliance continued to refuse Hardt
complete disability benefits after further review, Hardt would
have had the opportunity to bring the decision back before the
district court, at which time the court could rule on the merits
of the claim. Because it did not require Reliance to award
benefits to Hardt, however, the remand does not constitute an
11
“enforceable judgment[] on the merits” as Buckhannon requires.
532 U.S. at 604.
To avoid this result, Hardt points to two district court
cases in which a party was awarded attorney’s fees after a
remand to a plan administrator: Clark v. Metro Life Ins. Co.,
384 F. Supp. 2d 894 (E.D. Va. 2005), and Christian v. DuPont-
Waynesboro Health Care Coverage Plan, 12 F. Supp. 2d 535 (W.D.
Va. 1998). Even assuming these cases are consistent with
Buckhannon, they do not aid Hardt. In each of those cases, the
plaintiff included a second count alleging procedural error
under ERISA and requesting remand as the appropriate legal
relief. Thus, by remanding the case, the district court in
those cases was providing the very relief requested by the
complaint. Hardt, however, did not include such a count in her
complaint.
Because (1) Hardt’s only request for relief was the award
of benefits, which the district court did not award, and (2) the
district court’s remand order did not satisfy the requirements
of Buckhannon or Goldstein, Hardt does not qualify as a
prevailing party and is thus not eligible for an award of
attorney’s fees.
12
III.
For the foregoing reasons, Hardt’s attorney’s fees award is
VACATED.
13