United States District Court, Northern District of Illinois, E.D
May 2, 1984
UNITED INDEPENDENT FLIGHT OFFICERS, INC.; WILLIAM JAY PLANK; L. FRANK MURPHEY; THOMAS C. COOK; N. WAYNE HUGHES; JACK W. PARSHALL; H. HARVEY HUNTER; HARRY J. LANGOSH; GEORGE NORWOOK; ROBERT M. SCHISLER; AND LEROY A. SHAVER, PLAINTIFFS,
UNITED AIRLINES, INC., AND AIR LINE PILOTS ASSOCIATION, INTERNATIONAL, DEFENDANTS.
The opinion of the court was delivered by: Aspen, District Judge:
MEMORANDUM OPINION AND ORDER
Plaintiffs United Independent Flight Officers, Inc. ("UIFO")
sued defendants United Air Lines, Inc. ("United Air Lines")
and Air Line Pilots Association, International ("ALPA") for
alleged violations of the Employee Retirement Security Act of
1974, as amended, 29 U.S.C. § 1001 et seq. ("ERISA"), the
Railway Labor Act, 45 U.S.C. § 151 et seq., and the Age
Discrimination in Employment Act, 29 U.S.C. § 621 et seq.
On October 6, 1983, this Court granted defendants' motions
for summary judgment, 572 F. Supp. 1494. Presently pending
before the Court in ALPA's petition for attorneys' fees and
costs for its defense of Counts I and II of plaintiffs'
complaint, pursuant to Section 502(g)(1) of ERISA,
29 U.S.C. § 1132(g)(1). ALPA also seeks fees for its defense of Count IV,
which alleged violations of the duty of fair representation
under the Railway Labor Act, 45 U.S.C. § 151 et seq.*fn1 ALPA
claims that UIFO instituted the present action in bad faith.
For reasons set forth below, ALPA's petition is denied.
Section 502(g)(1) of ERISA, 29 U.S.C. § 1132(g)(1) provides
that "[i]n any action under this subchapter . . . the court in
its discretion may allow a reasonable attorneys' fees and costs
of action to either party." It is clear that a fee award to the
prevailing party in an ERISA is not mandatory, but is
discretionary. Janowski v. International Brotherhood of
Teamsters Local No. 710 Pension Fund, 673 F.2d 931, 941 (7th
Cir. 1982); Moyers v. Frank P. Bauer Marble Co., 556 F. Supp. 192,
195 (N.D.Ill. 1983).
In determining whether to award attorneys' fees under ERISA,
the courts may consider the following factors: (1) the degree
of the offending parties' culpability or bad faith; (2) the
degree of the ability of the offending parties to satisfy
personally an award of attorneys' fees; (3) whether an award
of attorneys' fees against the offending parties would deter
other persons from acting under similar circumstances; (4)
whether the parties requesting fees sought to benefit all
participants and beneficiaries or to resolve a significant
legal question regarding ERISA; and (5) the relative merits of
the parties' positions. Bittner v. Sadoff & Rudoy Industries,
728 F.2d 820, at 828 (7th Cir. 1984); Leigh v. Engle,
727 F.2d 113, at 139 n. 39 (7th Cir. 1984); Marquardt v. North American
Car Corp., 652 F.2d 715, 717 (7th Cir. 1981); Hummell v. S.E.
Rykoff & Co., 634 F.2d 446, 452 (9th Cir. 1980). We note,
however, as the court did in Marquardt, that an award of
attorneys' fees against an ERISA plaintiff will rarely be
justified, Marquardt, 652 F.2d at 720.
The above factors, moreover, are oriented to cases in which
a plaintiff has prevailed and seeks attorneys' fees against a
defendant. In the present case, a defendant seeks fees against
a plaintiff. In such cases, according to the Seventh Circuit,
there is a modest presumption in favor of awarding defendants
attorneys' fees unless the plaintiffs' position was
"substantially justified" — in other words, was less than
meritorious, but had a solid basis. Bittner v. Sadoff & Rudoy
Industries, 728 F.2d 820, at 830 (7th Cir. 1984).
UIFO's lawsuit, while not in our view meritorious, was
clearly substantially justified. UIFO capably raised a series
complex legal issues in an area of law noted for a dearth of
legal precedent. Accordingly, ALPA's petition for attorneys'
fees under ERISA is denied.
ALPA also asserts that it is entitled to attorneys' fees
with respect to Count IV of plaintiffs' complaint, which
alleges violation of ALPA's duty of fair representation under
the Railway Labor Act, 45 U.S.C. § 151 et seq. Nowhere in
45 U.S.C. § 151 et seq. is a prevailing party, plaintiff or
defendant, specifically authorized an award of attorneys' fees.
ALPA claims that UIFO pursued the instant action in bad faith.
In the United States, the prevailing party is ordinarily not
entitled to attorneys' fees from the losing party. Rather, in
conformity with the "American Rule," and absent specific
statutory or other express authorization, each litigant must
bear the expense of his own attorney. Alyeska Pipeline Service
Co. v. Wilderness Society, 421 U.S. 240, 247, 95 S.Ct. 1612,
1616, 44 L.Ed.2d 141 (1975); Bailey v. Meister Brau, Inc.,
535 F.2d 982, 994 (7th Cir. 1976); Venus v. Goodman, 556 F. Supp. 514,
520 (N.D.Ill. 1983).
A recognized exception, however, allows a court to assess
attorneys' fees against a losing party who has "acted in bad
faith, vexatiously, wantonly, or for oppressive reasons . . ."
Alyeska Pipeline, 421 U.S. at 258-259, 95 S.Ct. at 1622-1623,
citing F.D. Rich, Inc. v. United States ex rel. Industrial
Lumber Co., Inc., 417 U.S. 116, 129, 94 S.Ct. 2157, 2165, 40
L.Ed.2d 703 (1975).
The bad faith exception for the award of attorneys' fees is
not restricted to cases where the action is filed in bad
faith. "`[B]ad faith' may be found, not only in the actions
that led to the lawsuit, but also in the conduct of the
litigation." Hall v. Cole, 412 U.S. 1, 15, 93 S.Ct. 1943, 1951,
36 L.Ed.2d 702 (1973).
It is evident that UIFO's claim of unfair representation
under the Railway Labor Act arose out of the same series of
facts in its ERISA claim. We earlier determined that UIFO was
substantially justified in pursuing its ERISA claim. UIFO did
not act in bad faith in pursuing its claim under the Railway
Labor Act. UIFO did not act vexatiously, wantonly, or for
oppressive reasons in bringing suit. Nor did it conduct this
litigation in such a manner.
Accordingly, ALPA's motion for attorneys' fees under the
Railway Labor Act is also denied. It is so ordered.