Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_02-cv-05746/USCOURTS-cand-5_02-cv-05746-3/pdf.json

Nature of Suit Code: 791
Nature of Suit: Employee Retirement Income Security Act (ERISA)
Cause of Action: 29:1132 E.R.I.S.A.: Employee Benefits

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United States District Court

For the Northern District of California

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United States District Court

For the Northern District of California

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

Lydia Winterstein,

Plaintiff,

 v.

Stryker Corporation Group Life Insurance

Plan, et al.,

Defendants.

 /

NO. C 02-05746 JW 

ORDER GRANTING IN PART

PLAINTIFF’S MOTION FOR

ATTORNEY FEES 

I. INTRODUCTION

This action arose under the Employment Retirement Income Security Act, 29 U.S.C. § 1001

(“ERISA”). Lydia Winterstein (“Plaintiff”), a citizen of California, is the designated beneficiary of

her mother’s life insurance policy. The Defendants are Stryker Corporation and Stryker Corporation

Group Life Insurance Plan (collectively “Defendants”). The Court entered judgment in favor of

Plaintiff and against Defendants on January 19, 2006. Presently before the Court is Plaintiff’s

Motion for Attorney Fees. This Motion was heard before the Court on April 3, 2006. Upon

consideration of the briefs filed to date and the oral arguments of counsel, Plaintiff’s Motion for

Attorney Fees is GRANTED IN PART.

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Plaintiff's motion also sought to amend the Court's judgment to include prejudgment

interest. However, on March 31, 2006, the parties stipulated to taking the prejudgment interest

portion of Plaintiff's motion off calendar and continuing the hearing on that matter until May 1,

2006. (Stipulation and Proposed Order Regarding Plaintiff’s Motion to Alter or Amend Judgment

and for Attorney Fees, Docket Item No. 89.) On April 12, 2006, the parties stipulated to

withdrawing the pending motion for prejudgment interest and to determine money damages, with

prejudice, and the Court entered its Order accordingly. (Stipulation and Order, Docket Item No. 92.)

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II. BACKGROUND

Plaintiff initiated this action to obtain supplemental life insurance benefits in the amount of

$180,000 after the death of her mother, Blanca Winterstein (“Blanca”), on December 16, 2001. The

Court first dismissed Winterstein’s claim against Defendant Stryker Corporation for breach of

fiduciary duty. The Court subsequently granted Defendants’ motion for summary adjudication on

the standard of review, finding the appropriate standard to be abuse of discretion. Upon the parties'

filing of cross-motions for summary judgment, the Court entered judgment in favor of Defendants

on January 27, 2004. (Defendants’ Opposition to Plaintiff’s Motion to Alter or Amend Judgment

and for Attorney Fees, hereinafter “Opp’n,” Docket Item No. 82, 2:6-26.) 

Plaintiff appealed the Court’s judgment. On November 28, 2005, the U.S. Court of Appeals

for the Ninth Circuit reversed and remanded. Plaintiff filed an Attorney’s Fees Application in the

Ninth Circuit, requesting $212,485 for fees incurred on appeal. The Ninth Circuit held that Plaintiff

is entitled to fees incurred on appeal, but determination of the amount of fees incurred on appeal is

still pending before an appellate commissioner at this time. (Opp’n at 2:3-8.) 

Pursuant to the Ninth Circuit’s order, the Court entered judgment in favor of Plaintiff on

January 19, 2006. (Plaintiff’s Motion to Alter or Amend Judgment and for Attorney Fees,

hereinafter “Mot.,” Docket Item No. 75, 1:1-5.) On January 31, 2006, Plaintiff filed a motion

seeking an award of attorney fees for the proceedings before this Court.1

 (Mot. at 1:6-9.) 

Defendants contend that Plaintiff’s requests for attorney’s fees are excessive and unreasonable in

this case. (Opp’n at 15-22.)

III. STANDARDS

A participant prevailing under ERISA in a suit to recover benefits may recover reasonable

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attorney fees. 29 U.S.C. § 1132(g)(1). As a general rule, ERISA plaintiffs should be entitled to

reasonable attorney’s fees “if they succeed on any significant issue in litigation which achieves some

of the benefit the parties sought in bringing suit.” Smith v. CMTA-IAM Pension Trust, 746 F.2d

598, 589 (9th Cir. 1984). The section providing for attorney’s fees should be read broadly, allowing

for recovery of attorney’s fees “unless special circumstances would render such an award unjust.” 

Nelson, 37 F.3d at 1392.

IV. DISCUSSION

As the prevailing party in this case, Plaintiff requests that the Court award her reasonable

attorney fees pursuant to 29 U.S.C. § 1132(g)(1). (Mot at 5.) Defendants contend that Plaintiff is

not entitled to attorney fees and, even if the Court finds Plaintiff to be so entitled, only a reasonable

amount should be awarded. (Opp’n at 10, 14.) 

The Court finds no special circumstances rendering an award of attorney fees unjust in this

case, given Plaintiff’s ultimate success in her claim. The Ninth Circuit’s decision to grant attorneys

fees to Plaintiff for legal work on the appeal is a separate matter from the fees Plaintiff seeks before

the Court here. The Court finds that Plaintiff is entitled to reasonable attorney fees as outlined

below.

1. Number of Billable Hours

Plaintiff requests attorney fees for 373.95 hours. (Reply at 8:7-9.) Defendants objected to

Plaintiff’s request, contending that the number of billable hours is excessive and unreasonable. 

(Opp’n at 15-18.) Specifically, Defendants argue that since this case was not beyond the scope of an

ordinary ERISA benefits claim, Plaintiff’s counsel, Martin Snitow, spent an unreasonable number of

hours amending the complaint, working on discovery, preparing a motion for summary judgment,

preparing for oral argument, and preparing a second motion for summary judgment. (Opp’n at 15:7-

8; 15-18.) However, earlier in the Opposition, Defendants analogize this case to one in which the

matter was “a genuine and complicated issue,” because the central issues here were decided

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differently by two courts. (Opp’n at 5:2-5.) As this case dealt with a complicated issue, there is

nothing to indicate that the amount of time spent by Plaintiff’s counsel was unreasonable. 

Moreover, because of the contingent nature of Mr. Snitow's fee arrangement, where anticipated

compensation was not based on hours expended, it would not be unreasonable to assume that Mr.

Snitow had little incentive to devote unnecessary time or effort to the case.

Defendants further contend that a 10% reduction in the number of billable hours should be

applied, as Plaintiff’s quarter-hour billing method is allegedly deficient. Nothing in 29 U.S.C. 

§ 1132(g)(2)(D) limits recovery of attorney’s fees to billing increments by the tenth of the hour. 

Rather, the statute provides for “reasonable attorney's fees.” (29 U.S.C. § 1132(g)(2)(D).) The

Court finds Lopez v. San Francisco Unified School District inapposite here. Lopez and Zucker v.

Occidental Petroleum Corp., upon which Lopez relied, were class actions with thousands of hours

billed, resulting in a significant disparity when quarter-hour billing was used rather than tenth-hour

billing. (Lopez v. San Francisco Unified School District, 385 F. Supp.2d 981, 993 (N.D. Cal. 2005)

citing Zucker v. Occidental Petroleum Corp., 968 F. Supp. 1396 (C.D. Cal. 1997).) Given Mr.

Snitow’s long-time practice of billing by the quarter-hour and the de minimis difference between

quarter-hour billing and tenth-hour billing at the lodestar rate determined below, the Court finds that

billing by the quarter-hour is not excessive or inappropriate here.

2. Rate of Billable Hours

Plaintiff contends that she is entitled to a higher than “standard” rate of billable hours,

seeking either Mr. Snitow’s customary hourly rate of $375 with a multiplier, or a rate of $650

without a multiplier. Defendants argue that Plaintiff’s requested rates are “unreasonable in light of

the rate prevailing in the community for similar services by lawyers of reasonably comparable skill,

experience, and reputation.” (Opp’n at 19:7-12.)

A reasonable attorney fee is the number of hours and the hourly rate that would be billed by

"reasonably competent counsel." See Yahoo! Inc. v. Net Games, Inc., 329 F.Supp.2d 1179, 1183

(N.D. Cal. 2004) (attorney fee applicants are entitled to an award sufficient to enable them to secure

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reasonably competent counsel, but are not entitled to an award necessary to secure counsel of their

choice). Moreover, a trial court has broad authority to determine the amount of reasonable

attorney’s fees appropriate under state law. Idaho Potato Com’n v. G & T Terminal Packaging, Inc.,

425 F.3d 708 (9th Cir. 2005). See also PCLM Group, Inc. v. Drexler, 22 Cal. 4th 1084, 1095, 95

Cal. Rptr. 2d 198, 206 (2000) (applying CA Civil Code Section 1717). 

The Court has reviewed Plaintiff's attorney's fees in this action and finds the requested rate of

compensation, at either $375 or $650, to be excessive. In Yahoo! Inc. v. Net Games, Inc., a rate of

$266 per hour for attorneys was found to be excessive based on the nature of the case. 329 F. Supp.

2d 1179. The court reasoned that although the plaintiff argued that the factual analysis was detailed

and the legal analysis was complex, the plaintiff's description was plainly an exaggeration because

the case "simply was not unusually complex." Id. at 1189. Although the instant case may have been

complex, it does not warrant an hourly rate higher than the prevailing market rate for ERISA

litigation cases in the San Francisco Bay Area. The market rate for ERISA benefit cases in the

relevant geographical area ranges from $200 for attorneys with a lower level of experience, to $475

for attorneys with the highest level of specialized ERISA experience. (Opp’n at 20:1-4.) Plaintiff’s

counsel has 36 years of experience in the practice of law, but this was his first time handling an

ERISA case. Based on Mr. Snitow’s level of experience in ERISA matters, the market rate for

ERISA benefit cases corresponds with that of the mean hourly wage of attorneys in the San Jose

area. Accordingly, the Court finds it appropriate to adopt the formulae as set forth in Yahoo!, where

the reasonable rate is calculated by dividing the mean hourly wage of attorneys in the San Francisco

area by the ratio of net receipts to gross receipts. See id. 

The Court will calculate the reasonable rate based on the mean hourly wage of attorneys in

the San Jose area, and divide that number by the ratio of net to gross receipts using the most recent

2001 year data from the 2004-2005 Statistical Abstract. See United States Census Bureau,

Statistical Abstract of the United States: 2004-2005, tbl 718, available at

http://www.census.gov/statab/www/. Gross receipts totaled $91 billion and net receipts totaled $32

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billion. This yields a ratio of net receipts to gross receipts of 0.352. The most recent data available

from the Bureau of Labor Statistics ("BLS") describing hourly wages in the San Jose area are

available at http://www.bls.gov/oes/current/oes_7400.htm#b23-0000. Dividing the most recent

mean hourly wage for lawyers, $72.63/hr, by the ratio of net to gross receipts, 0.352, yields an

estimate of $206.34/hr as the average market rate for lawyers in the San Jose area. 

At the hearing on April 3, 2006, the Court expressed appreciation that Mr. Snitow provided a

valuable service to his client by taking on this ERISA case despite the contingent nature of his

attorney fees. However, Supreme Court and Ninth Circuit precedent prohibit enhancement of the

lodestar rate for contingency fee cases regarding fee requests made under federal fee shifting

statutes, such as 29 U.S.C. § 1132(g)(1). (See City of Burlington v. Dague, 505 U.S. 557, 561-62

(1992); Cann v. Carpenters Pension Trust Fund for N. California, 989 F.2d 313, 318 (9thCir. 1993);

Davis v. City & County of San Francisco, 976 F.2d 1536, 1549, vacated in part on den’l of reh’g by

984 F.2d 345 (9th Cir. 1993) (contingency should not be used as a factor in setting the lodestar rate,

nor as a basis for enhancing the lodestar fee). Accordingly, the Court finds that the lodestar rate of

$206.34/hr may not be enhanced to reflect a higher rate due to the contingent nature of the case.

The Court finds that Plaintiff is entitled to $77,160.84 in attorney fees, which is derived from

multiplying the number of billable hours, 373.95, by the average market rate for lawyers in the San

Jose area, $206.34/hr.

V. CONCLUSION

For the foregoing reasons, the Court GRANTS IN PART Plaintiff’s request for Attorney

Fees, in the amount of $77,160.84. 

Dated: April 24, 2006

02cv5746fees

 /s/ James Ware 

JAMES WARE

United States District Judge

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THIS IS TO CERTIFY THAT COPIES OF THIS ORDER HAVE BEEN DELIVERED TO:

Clarissa A. Kang ckang@truckerhuss.com

Martin S. Snitow snitow@aya.yale.edu

R. Bradford Huss bhuss@truckerhuss.com

Yana S. Johnson yjohnson@mofo.com

Dated: April 24, 2006 Richard W. Wieking, Clerk

By:_/s/ JW Chambers_______

Melissa Peralta

Courtroom Deputy

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