UNUM's argument that its decision-making process was procedurally sound was not "substantially justified."
Reasonableness of Fees
Although Ms. Perlman is entitled to fees, I may only award fees that are reasonable in relation to the results Ms. Perlman obtained. Texas State Teachers Ass'n, 489 U.S. at 789-90; Janowski, 812 F.2d at 298-99. Determining which fees Ms. Perlman should be awarded based on her argument that UNUM's decision-making was procedurally defective is not simple. Unlike many cases where a litigant may prevail on one count of a numerous count charge and fees may be determined based solely on efforts to win that particular count, Ms. Perlman's case consisted of various arguments arising out of a common core of facts. The Supreme Court has counseled that "district courts should exercise their equitable discretion in such cases to arrive at a reasonable fee award, either by attempting to identify specific hours that should be eliminated or by simply reducing the award to account for the limited success of the plaintiff." Texas State Teachers Ass'n, 489 U.S. at 789-90. "The district court should focus on the significance of the overall relief obtained by the plaintiff in relation to the hours reasonably expended on the litigation." Hensley, 461 U.S. at 435. "The most critical factor is the degree of success obtained." Id. at 436.
Ms. Perlman fell short of the success she sought. Ms. Perlman argued for de novo review of her claim, reversal of UNUM's denial of benefits, an award of short-term disability benefits, and an award of long-term disability benefits. She only achieved reversal of UNUM's denial of benefits and a remand. Given Ms. Perlman's success in relation to the relief she sought, I find she achieved one-third of the relief she requested. Accordingly, I find that Ms. Perlman is entitled to one-third of her attorney's fees. See Stanton v. Larry Fowler Trucking, Inc., 863 F. Supp. 908, 912 (E.D. Ark. 1994)(finding a plaintiff who was successful on only one of three aspects of relief sought was entitled to one-third of requested fees).
A determination of reasonable attorney's fees requires calculation of the "lodestar." The lodestar is the product of an attorney's reasonable hourly rate and the number of hours reasonably expended. People Who Care v. Rockford Bd. of Educ., Sch. Dist. Number 205, 90 F.3d 1307, 1310 (7th Cir. 1996). UNUM first objects to Ms. Perlman's attorney's hourly rates. Lead counsel for Ms. Perlman, George Weaver, billed his time at $ 250 per hour and billed his associate's time at $ 100 per hour. "The attorney's actual billing rate for comparable work is 'presumptively appropriate' to use as the market rate." Id. (quoting Gusman v. Unisys Corp., 986 F.2d 1146, 1150 (7th Cir. 1993). In support of his hourly rate, Mr. Weaver has presented his own affidavit, that of Dina Arrigo, his associate, and that of Gene Hansen, a partner with a Chicago law firm. Mr. Weaver's affidavit states he has twenty-five years of legal experience and that since 1992 he has billed every client $ 250 per hour. Mr. Weaver states that his familiarity with hourly rates for attorneys of similar competence indicates his rate is well within the market rate. Similarly, Ms. Arrigo's affidavit states she has billed at $ 100 per hour for the last several years. Mr. Hansen's affidavit states that, as a lawyer with over 20 years of experience, he is familiar with fees charged by lawyers in law firms in Chicago and that Mr. Weaver's rate of $ 250 per hour is reasonable. UNUM presents no evidence that Mr. Weaver's hourly rates are not within the market rate of the Chicago area.
Mr. Weaver's rate of $ 250 per hour is not unreasonable given the complexity of this case. Ms. Perlman's claim involved disputed medical benefits that required proving UNUM's decision-making process was procedurally flawed. Further, Ms. Arrigo's rate of $ 100 per hour is reasonable given her fifteen years of legal experience and the complexity of this case. Indeed it is conservative.
UNUM also claims that the hours Ms. Perlman's lawyers spent on this litigation were not reasonable. Ms. Perlman's lawyers have specifically broken down their billing and accounted for all of their hours. UNUM's objections, that Ms. Perlman's counsel spent over ten hours a day on her case (on three occasions) and spent thirty hours reading cases, are not meritorious. It is not unusual to bill considerable hours when filing deadlines approach or to do significant research in a case of this complexity. After reviewing Ms. Perlman's submissions, I find the hours expended in this case are reasonable.
Aside from $ 132,060.00 in attorney's fees, Ms. Perlman also claims $ 4,419.67 in costs. UNUM argues these costs are unreasonable and some are improper. In addition to attorney's fees, ERISA authorizes a court to assess costs. 29 U.S.C. § 1132(g). A court may shift only those costs taxable under 28 U.S.C. § 1920. Agredano v. Mutual of Omaha Companies., 75 F.3d 541, 543 (9th Cir. 1996); see also Neyer, Tiseo & Hindo, Ltd. v. Russell, 1994 U.S. Dist. LEXIS 5614, No. CIV.A. 92-2983, 1994 WL 158917, at *3-4 (E.D. Pa. April 29, 1994)(finding costs recoverable under ERISA are limited to those found in Section 1920 and 28 U.S.C. § 1821).
Ms. Perlman claims costs for her attorneys' traveling expenses. Ms. Perlman's request for costs to cover her attorneys' airline tickets, lodging, meals, and other transportation amounts to $ 1,508.39. These costs are not permitted under Section 1920 and accordingly, are not recoverable. Also, the cost of postage is not covered under Section 1920. Thus, Ms. Perlman's Federal Express costs of $ 20 must be disallowed. This leaves Ms. Perlman's costs at $ 2,891.28.
I find these costs are reasonable and award them in full.
In sum, Ms. Perlman is entitled to one-third of her attorney's fees, $ 44,020, and costs in the amount of $ 2,891.28, for a total of $ 46,911.28.
Ms. Perlman is the prevailing party in this litigation. UNUM was not substantially justified in arguing its decision-making process was procedurally sufficient. Still, Ms. Perlman did not achieve the total success she sought and thus, is not entitled to all of the fees she requests. For the reasons stated above, Ms. Perlman is awarded attorney's fees and costs in the amount of $ 46,911.28.
Elaine E. Bucklo
United States District Judge
Dated: January 16, 1998