UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 98-50061
Summary Calendar
CAROLYN J. GIBBS,
Plaintiff-Appellant,
VERSUS
ASHLEY E. GIBBS, a Minor Child and ANDREW F. GIBBS, a Minor Child,
Intervenor Plaintiffs-Appellees,
VERSUS
GENERAL AMERICAN LIFE INSURANCE COMPANY,
Defendant-Appellee.
Appeal from the United States District Court
for the Western District of Texas
March 3, 1999
Before DAVIS, DUHÉ, and PARKER, Circuit Judges.
ROBERT M. PARKER, Circuit Judge:
Appellant Carolyn J. Gibbs appeals the denial of her motion
for attorney’s fees in an ERISA case against Appellee General
American Life Insurance Company. Instead, the district court
awarded General American its attorney’s fees. We affirm in part
and vacate in part.
Background
Carolyn J. Gibbs married Joel Gibbs in 1988. They had two
children, Ashley and Andrew, who are Intervenors in this action.
Joel Gibbs was employed by Waco Magnetic Imaging and as part of his
employee benefits package, he was issued an insurance policy
through General American Life Insurance Company (“General
American”). Carolyn Gibbs was the named beneficiary of the policy.
In 1995, Carolyn and Joel Gibbs separated, and in December of that
year, Joel filed for divorce. The divorce proceedings upset
Carolyn Gibbs to such a degree that she told a friend that it would
be easier to deal with if Joel Gibbs were killed in a car wreck.
On January 25, 1996, Carolyn Gibbs took her children to the
Mothers’ Day Out program at Crestview Church of Christ. Carolyn
Gibbs discovered that her son Andrew had forgotten his lunch, so
she told him that his father would bring his lunch. When Andrew
cried, she promised that she would bring it herself. At
approximately 9:30 a.m., she called Joel Gibbs’ office and was told
by the office manager that he was on the phone. Carolyn Gibbs told
the office manager that she was late for school and asked her to
tell Joel to go by her townhouse to get Andrew’s lunch and to take
it to him at school. Carolyn told the office manager to tell Joel
that she would leave the kitchen door unlocked.
Joel Gibbs left work at 9:50 a.m. to retrieve Andrew’s lunch.
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When he did not return after a few hours, the police were
contacted. Joel Gibbs did not respond to telephone calls or to his
pager. Carolyn Gibbs had three classes at Baylor University from
9:30 a.m. to 2:00 p.m. At approximately 2:30 p.m. she picked up
the children at Crestview. Andrew was crying when she picked him
up and said that his daddy hadn’t brought his lunch. Carolyn Gibbs
then drove home and noticed Joel’s car in the carport. She then
noticed a police car and an officer in uniform who said that the
police had been called by Joel Gibbs’ office.
Carolyn Gibbs told the officer to drive around to the front
door because of the chow dog in the backyard. She took the
children in the backdoor and immediately noticed how messy the
house was. Pictures and videos were spread on the floor, and
drawers were opened and appeared as if they had been searched. She
called Joel’s name but received no response. She went upstairs and
saw Joel lying in the hallway with blood everywhere. She then ran
downstairs and took the kids out the front door.
The police entered the house and found Joel Gibbs’ body.
Although the police told Carolyn Gibbs that it appeared her husband
killed himself, it was later determined that he had been stabbed
numerous times and that his throat had been cut and that he had
been killed hours earlier. The Hewitt Police Department released
the townhouse back to Carolyn Gibbs at approximately 5:00 p.m. The
next day, Carolyn Gibbs’ father, who had arrived the previous
evening from Colorado, was instrumental in arranging for his
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daughter’s Sunday School class to clean up the townhouse. This
included ripping out the bloodstained carpet, repainting the walls,
and generally cleaning up all signs of the murder.
The Hewitt Police Department contacted the Texas Rangers for
assistance, but their investigation did not begin until after the
townhouse had been cleaned. The murder weapon was found at a
subsequent time. Carolyn Gibbs discovered additional bloodstains
when she returned to the townhouse on January 31 for a final
cleaning before she left town. She pointed those out to the
police. Items discovered missing from the townhouse included a
camcorder, some home videos, Carolyn Gibbs’ high school class ring,
and one of the children’s silver baby mug. Ten days after the
murder, Carolyn Gibbs was approached by the Texas Rangers to
undergo a polygraph examination. Upon advice of counsel, she
declined.
Carolyn Gibbs and her children moved in with a friend for
approximately four weeks. They then moved to Colorado Springs to
live with her parents. In January 1997, Carolyn Gibbs’ former
boyfriend, Bartley Bell, moved to Colorado; they married in July.
In April 1996, Gibbs submitted a claim for the proceeds from
Joel Gibbs’ life insurance policy to his employer. General
American received the claim in July 1996. General American was
advised by Joel Gibbs’ employer that Carolyn Gibbs was a suspect in
her husband’s death. The Hewitt Police Department advised General
American that Carolyn Gibbs had not been ruled out as a suspect.
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In October 1996, Carolyn Gibbs contacted General American to
determine the status of her claim. General American contacted the
Hewitt Police Department again and was informed that Carolyn Gibbs
still had not been eliminated as a suspect. General American then
wrote her and informed her that the claim would not be paid until
the investigation into Joel Gibbs’ death had been completed. The
insurance policy at issue contained a provision which allowed a
beneficiary suspected to be involved in an insured’s death to waive
payment of the proceeds and designate another beneficiary. Under
this provision, Carolyn Gibbs could have waived her entitlement to
the insurance proceeds and have had them assigned to her minor
children. She elected not to make this waiver.
Carolyn Gibbs initiated a suit for benefits under ERISA
against General American in February 1997, claiming that General
American had refused to pay the benefits due her. At that time,
General American filed an interpleader counterclaim under Federal
Rule of Civil Procedure 22, depositing the insurance proceeds into
the registry of the court in the amount of $88,852.00. Carolyn and
Joel Gibbs’ two minor children intervened, and a guardian ad litem
was appointed to represent their interests.
After a bench trial, the district court concluded that Carolyn
Gibbs had not prevailed on her claims against General American but
that she had prevailed in her claims against the Intervenors
because they failed to prove by a preponderance of the evidence
that Carolyn Gibbs caused or was involved in the death of Joel
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Gibbs. This conclusion is not the subject of this appeal. This
appeal is solely about attorney’s fees under ERISA. Carolyn Gibbs
requested payment of her attorney’s fees by General American. The
district court found that General American had not acted in bad
faith and denied Gibbs’ request for attorney’s fees. However, the
district court determined that General American was entitled to an
award of fees in the amount of $21,100.85 to be paid by Gibbs in
order to deter others from filing premature lawsuits to collect
insurance benefits. The district court further determined that the
guardian ad litem’s fees and costs in the amount of $19,047.98 were
to be paid by Gibbs from the proceeds of the insurance policy.
Gibbs timely appeals.
Analysis
Under ERISA, “the court in its discretion may allow a
reasonable attorneys’ fee and costs of action to either party.” 29
U.S.C. § 1132(g)(1). This court reviews the district court’s
decision with respect to the award of costs and fees under ERISA
for an abuse of discretion. Todd v. AIG Life Insurance Co., 47
F.3d 1448, 1458 (5th Cir. 1995). This court considers five factors
in determining whether an attorney’s fee award is appropriate:
(1) the degree of the opposing parties’ culpability or bad
faith;
(2) the ability of the opposing parties to satisfy an award
of attorneys’ fees;
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(3) whether an award of attorneys’ fees against the opposing
party would deter other persons acting under similar
circumstances;
(4) whether the parties requesting attorney’s fees sought to
benefit all participants and beneficiaries of an ERISA
plan or to resolve a significant legal question regarding
ERISA itself; and
(5) the relative merits of the parties’ position.
Id. (citing Iron Workers Local No. 272 v. Bowen, 624 F.2d 1255
(5th Cir. 1980)).
We note at the outset that the district court did not abuse
its discretion in denying Gibbs’ request for attorney’s fees. It
was entirely appropriate for General American to interplead the
proceeds of the insurance policy as General American was merely
attempting to avoid multiple claims and double payments.
We also conclude that the district court abused its discretion
in awarding attorneys’ fees to the guardian ad litem. In Martin v.
Blue Cross and Blue Shield of Virginia, Inc., 115 F.3d 1201 (4th
Cir. 1997), the Fourth Circuit held that only a prevailing party is
entitled to a consideration for attorneys’ fees in an ERISA action.
This holding is consistent with this circuit’s statement in Boggs
v. Boggs, 82 F.3d 90 (5th Cir. 1996), rev’d on other grounds, 520
U.S. 833, 117 S.Ct. 1754, 138 L.Ed.2d 45 (1997), explaining that
ERISA “allows the court to award ERISA beneficiaries, participants,
and fiduciaries reasonable attorney’s fees and costs when they are
the prevailing party.” Id. at 94 n. 1. As the court in Boggs
affirmed the district court’s denial of the plaintiff’s request for
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declaratory judgment, it concluded that the plaintiff was not
entitled to attorneys’ fees. In the present case, the Intervenors
were not the prevailing party. For this reason, the guardian ad
litem is not entitled to attorneys’ fees.
The last issue that we address is the award of attorney’s fees
and costs to General American, the defendant in this lawsuit.
Although ERISA provides that the court may in its discretion award
costs and attorney’s fees “to either party,” we note the
conspicuous absence of any case citation by General American
wherein a defendant was awarded costs and attorney’s fees under
ERISA. The reason is obvious--such awards to the defendant are
rare. Although we recognize that General American is the
prevailing party in this case, this status merely provides for
“consideration” for attorneys’ fees. There is no presumption in
this circuit in favor of awarding costs and attorneys’ fees under
ERISA. Todd, 47 F.3d at 1459. This is especially true in the case
of a prevailing defendant. As stated in Marquardt v. North AM. Car
Corp., 652 F.2d 715 (7th Cir. 1981), even if the defendant prevails
in an ERISA action, consideration of the appropriate factors for
awarding attorneys’ fees “will seldom dictate an assessment of
attorneys’ fees against ERISA plaintiffs.” Id. at 720.
In awarding costs and fees to General American, the district
court relied heavily upon Factor #3: whether an award of
attorneys’ fees against the opposing party would deter other
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persons acting under similar circumstances. According to the
district court, “the award of attorneys’ fees to Defendant would,
hopefully, deter others from filing premature lawsuits to collect
insurance proceeds when the beneficiary remains under suspicion of
having murdered the insured.” Findings of Fact and Conclusions of
Law (Dec. 15, 1997), p. 8-9, ¶ 6. We acknowledge that the record
is clear that the district court found Gibbs to be an unsympathetic
plaintiff. The fact that Gibbs remained under suspicion for her
husband’s murder when she initiated suit was pivotal in the
district court’s decision. But that fact cannot be viewed in a
vacuum. Had it not been for the Hewitt Police Department’s
allowing most of the physical evidence to be cleaned up or
destroyed shortly after the murder, someone might have been charged
with the murder in the foreseeable future. But as it now stands,
Gibbs may be a suspect forever. We find that the deterrence factor
will be sufficiently satisfied with Gibbs’ being required to pay
for her own attorney’s fees and the Intervenor’s fees. Under these
circumstances it was an abuse of discretion to require Gibbs to
also pay General American’s fees and costs. Therefore, although §
1132(g)(1) does not explicitly differentiate between plaintiffs and
defendants in an ERISA case, we do not think that this is the
exceptional case in which a defendant should be awarded attorneys’
fees.
Accordingly, the judgment of the district court awarding costs
and attorney’s fees to General American Life Insurance Company and
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to the guardian ad litem is vacated. The judgment in all other
respects is affirmed.
AFFIRMED IN PART; VACATED IN PART.
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