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MAGIN v. MONSANTO COMPANY

September 1, 2005.

JON MAGIN, Plaintiff
v.
MONSANTO COMPANY, PHARMACIA CORPORATION and CP KELCO U.S., INC. Defendants.



The opinion of the court was delivered by: JAMES HOLDERMAN, District Judge

MEMORANDUM OPINION AND ORDER

On July 9, 2004, this court granted defendants Monsanto Company ("Monsanto"), Pharmacia Corporation ("Pharmacia"), and CP Kelco U.S., Inc.'s ("Kelco") motions for summary judgment on plaintiff Jon Magin's ("Magin"), claims under the Employee Retirement Income and Security Act of 1974, 29 U.S.C. § 1001 et seq., ("ERISA"), (Dkt. Nos. 108-10) aff'd Magin v. Monsanto Co., ___ F.3d ___, No. 04-2997, 2005 WL 2008233 (7th Cir. Aug. 23, 2005). On January 13, 2005, this court granted Monsanto and Pharmacia's motion for an award of attorneys' fees and costs pursuant to ERISA's fee shifting provision, 29 U.S.C. § 1132(g)(1), and an assessment of sanctions against plaintiff Magin and his counsel pursuant to 28 U.S.C. § 1927, but denied the defendants' request for sanctions against Magin under Rule 11 of the Federal Rules of Civil Procedure, Magin v. Monsanto Co., No. 03-1366, 2005 WL 83334 (N.D. Ill. Jan. 13, 2005). The court's January 13, 2005 order did not award a dollar amount to Monsanto and Pharmacia for attorneys' fees and costs because the parties had failed to comply with the requirements of Local Rule 54.3. Instead, the court set additional dates for the parties' compliance with Local Rule 54.3 and associated briefing. On March 1, 2005, Monsanto and Pharmacia filed the pending motion for an assessment of attorneys' fees and costs. (Dkt. No. 123). For the reasons set forth below, Monsanto and Pharmacia's renewed motion for attorneys' fees and costs of March 1, 2005 is granted.

BACKGROUND

  On January 13, 2005, this court held that Monsanto and Pharmacia were entitled to reasonable attorneys' fees and costs under ERISA's fee shifting position. Magin v. Monsanto Co. No. 03-1366, 2005 WL 83334, at *3-5 (N.D. Ill. Jan. 13, 2005). This court found that Magin had taken positions in this litigation that were not substantially justified, not taken in good faith and at times were objectively frivolous. Id. at *4-5. This court concluded on January 13, 2005 that it would be inappropriate for Monsanto and Pharmacia to bear their own attorneys' fees and costs in this litigation. Id. at *5.

  This court supported its January 13, 2005 determination that fee shifting was appropriate in this case based on a variety of shortcomings exhibited by Magin during the litigation. These deficiencies included filing state law claims in a second amended complaint after this court had previously held that Magin's state law claims were preempted under ERISA. Id. at *4 ("Magin had clear notice of the legal rule of ERISA preemption after this court's ruling on the first amended complaint, yet he took a second run at the same argument in his second amended complaint.").

  The court's opinion also noted that "Magin has failed to meet court imposed deadlines and requirements at various times throughout the litigation," Id. at *5, and he failed to provide support for legal arguments with citation or explanation. Id. at *4. Lastly, this court held that there were no special circumstances that mitigated against levying an award of attorneys' fees and costs against Magin. Id. at *5. Not only did Magin fail to provide evidence that he would be unable to pay an award of attorneys's fee but "Monsanto and Pharmacia argue that Magin received over $800,000 in salary and severance payments from Monsanto in 2000 and 2001." Id. at *5.

  The court bifurcated its determination that Monsanto and Pharmacia were entitled to an award of attorneys' fees and costs from the determination of a reasonable dollar amount to award. This court held that it was unable to determine a reasonable award amount on January 13, 2005 due to the parties' failure to comply with Local Rule 54.3. The court's January 13, 2005 opinion ordered the parties to comply with Local Rule 54.3 and set additional dates for briefing from the parties. The court determines in this opinion that the $271,548.47 requested by Monsanto and Pharmacia in attorneys' fees and costs is a reasonable amount.

  STANDARD OF REVIEW

  "Determination of an [attorney's] fee award is left to the discretion of the district court in light of its `superior understanding of the litigation and the desirability of avoiding frequent appellate review of what essentially are factual matters.'" Wengryn v. Connor Sports Flooring Corp., No. 01 C 1519, 2002 WL 2022608, at *2 (N.D. Ill. Sept. 3, 2002) (quoting Hensley v. Eckerhart, 461 U.S. 424, 437 (1983); Eddleman v. Switchcraft, Inc., 965 F.2d 422, 424 (7th Cir. 1992)). "A district court is within its discretion to reduce the number of hours requested, or the hourly rate requested, as long as it provides a reasonable, and `concise but clear explanation of its reasons.'" Hacket v. Xerox Corp. Long-Term Disability Income Plan, 355 F. Supp. 2d 931, 935 (N.D. Ill. 2005) (quoting Spegon v. Catholic Bishop of Chicago, 175 F.3d 544, 551, 554-55 (7th Cir. 1999)).

  ANALYSIS

  Section 1132(g)(1) of ERISA states, "In any action under this subchapter . . . by a participant, beneficiary, or fiduciary, the court in its discretion may allow a reasonable attorney's fee and costs of action to either party." 29 U.S.C. § 1132(g)(1). "There is a `modest presumption' in favor of awarding fees to the prevailing party, but that presumption may be rebutted." Senese v. Chicago Area I.B. of T. Pension Fund, 237 F.3d 819, 826 (7th Cir. 2001) (quoting Harris Trust & Sav. Bank v. Provident Life & Accident Ins. Co., 57 F.3d 608, 617 (7th Cir. 1995)).

  In determining whether fees and costs are appropriate, the court may apply one of two tests: (1) the "substantially justified" test or (2) the multi-factor test.*fn1 The Seventh Circuit leaves it to the district court to select which test to apply since "both tests essentially ask the same question: `Was the losing party's position substantially justified and taken in good faith, or was that party simply out to harass its opponent?'" Quinn v. Blue Cross and Blue Shield Ass'n, 161 F.3d 472, 478 (7th Cir. 1998) (quoting Hooper v. Demco, Inc., 37 F.3d 287, 294 (7th Cir. 1994)). "Substantially justified means something more than non-frivolous, but something less than meritorious." Senese, 237 F.3d at 826. The substantially justified standard developed from the underlying policy that "ERISA's remedial purpose is to protect, rather than penalize participants who seek to enforce their statutory rights." Stark v. PPM America, Inc., 354 F.3d 666, 673 (7th Cir. 2004) (quoting Senese, 237 F.3d at 826)).

  This court previously determined in its January 13, 2005 memorandum opinion and order that it is proper to assess attorneys' fees and costs against Magin under ERISA's fee shifting provision because he took positions in this litigation which were not substantially justified, not taken in good faith and at times were objectively frivolous. Magin v. Monsanto Co. No. 03-1366, 2005 WL 83334, at *3-5 (N.D. Ill. Jan. 13, 2005). The court must now determine ...


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