Document ID: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca8-09-02890/USCOURTS-ca8-09-02890-0/pdf.json

Parties Involved:
Cindy Rote
Appellee
Titan Tire Corporation
Appellant

Document Text:

United States Court of Appeals

FOR THE EIGHTH CIRCUIT

___________

Nos. 09-2510/2890

___________

Cindy Rote, * 

*

Appellee, *

* Appeals from the United States

v. * District Court for the

* Southern District of Iowa.

Titan Tire Corporation, *

* [PUBLISHED] 

Appellant. *

___________

Submitted: February 8, 2010 

Filed: July 28, 2010

___________

Before LOKEN, Chief Judge,1

 GRUENDER and BENTON, Circuit Judges.

___________

PER CURIAM.

Cindy Rote has been seeking long-term disability benefits from Titan Tire

Corporation (“Titan”) for over eight years. Rote began working at Titan’s plant on

November 7, 1984, and joined the union. In 1997, Rote had surgeries to replace the

joints in both of her thumbs. In April 1998, while she was still recovering from

surgery, the union went on strike. The strike ended in October 2001. Rote wanted to

return to work at the end of the strike, and Titan asked Dr. Anthony Sciorrotta to

1

The Honorable James B. Loken stepped down as Chief Judge of the United

States Court of Appeals for the Eighth Circuit at the close of business on March 31,

2010. He has been succeeded by the Honorable William Jay Riley.

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evaluate Rote’s ability to return to work. Dr. Sciorrotta restricted Rote to jobs that did

not require frequent pinching with more than five pounds of force and did not involve

kneeling or squatting. Titan informed Rote that there were no jobs compatible with

those restrictions available at the plant.

Although Rote had difficulty obtaining the necessary paperwork from Titan, she

eventually filed an application for long-term disability benefits. Dr. Scott Neff, who

performed Rote’s joint replacement surgeries, evaluated Rote and stated that “her

restrictions have not changed, and consequently, based on the employer[’]s decision,

she is considered disabled.” Rote submitted Dr. Neff’s evaluation with her disability

application. Under Titan’s disability plan, an employee is eligible for benefits if she

is “permanently and totally disabled . . . so as to be prevented thereby from being

physically able to perform the work of any classification in the local plant.” Titan, as

the administrator of its own ERISA plan, denied Rote’s application for disability

benefits, stating only that she did “not qualify as ‘disabled’ under the plan.”

Rote filed suit against Titan, challenging the denial of her application. The

district court vacated Titan’s denial of benefits, holding that the decision was

conclusory and lacked much of the explanation required under 29 C.F.R. § 2560.503-

1. The court remanded the matter to the administrator for reevaluation of Rote’s

claim. See Abram v. Cargill, Inc., 395 F.3d 882, 886 (8th Cir. 2005) (“A reviewing

court must remand a case when the court or agency fails to make adequate findings

or explain the rationale for its decision.”).

On remand, Rote submitted additional evidence to support her claim for

disability benefits. In particular, Rote’s attorney wrote to both Dr. Neff and Dr.

Sciorrotta. Her attorney’s letter noted that “[a] question has now arisen as to whether

the restrictions you imposed . . . were only temporary or were intended to be

permanent,” and then asked whether the doctors recommended that Rote “continue to

follow these [work] restrictions indefinitely.” Both doctors responded affirmatively

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with respect to the restrictions on pinching and gripping. Dr. Sciorrotta explained,

“With respect to whether I would recommend that Ms. Rote continue to follow these

restrictions indefinitely, I would say that regarding her hands, she should continue

with those restrictions since they were outlined by Dr. Neff and were felt to be of a

permanent nature.”2

Titan again denied Rote’s application, claiming that because the restrictions on

her physical activity were only to be followed “indefinitely,” Rote was not

“permanently” disabled and therefore did not qualify for long-term disability benefits

under the plan. Rote requested a formal review of the decision and included in her

request a letter from Dr. Neff clarifying that he intended Rote’s restrictions to be

“permanent.” Titan indicated that it would be “consulting with an independent

medical expert regarding Ms. Rote’s appeal,” but it later denied Rote’s claim. After

Rote made several requests for whatever information the independent medical expert

provided, she eventually learned that he provided no written information.

Rote again filed suit, challenging Titan’s denial of her application for long-term

disability benefits. The district court3

 held that Titan abused its discretion in denying

Rote’s application and reversed the decision, ordering Titan to pay Rote disability

benefits. The district court also awarded Rote attorney’s fees in the amount of

$13,675, which included fees incurred from May 18, 2004, the date Rote filed her

original suit in the district court. Titan appeals both decisions.

Like the district court, we review the plan administrator’s decision for an abuse

of discretion because the plan gives Titan discretionary authority to determine

2

Dr. Sciorrotta also opined that Rote’s restrictions related to kneeling and

squatting need not be continued indefinitely.

3

The Honorable John A. Jarvey, United States District Judge for the Southern

District of Iowa.

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eligibility for benefits. See LaSalle v. Mercantile Bancorporation, Inc. Long Term

Disability Plan, 498 F.3d 805, 808-09 (8th Cir. 2007).4

 “Under this standard, we

consider whether the administrator’s decision is supported by such relevant evidence

that a reasonable mind might accept as adequate to support such a conclusion.” Id. at

809. “[W]e ask whether the decision to deny . . . benefits was supported by

substantial evidence, meaning more than a scintilla but less than a preponderance.” 

Schatz v. Mut. of Omaha Ins. Co., 220 F.3d 944, 949 (8th Cir. 2000).

We agree with the district court that Titan abused its discretion in denying

Rote’s application for long-term disability benefits. The parties do not dispute that

Rote qualifies as “disabled” under the plan and that her disability is “total.” Titan’s

sole reason for denying Rote’s application was that she had not shown her disability

to be “permanent.” To reach that conclusion, Titan interpreted the doctors’ letters as

suggesting that Rote’s restrictions are not permanent, focusing on the use of the term

“indefinitely” and relying on one dictionary definition of “indefinite.” See Black’s

Law Dictionary 769 (6th ed. 1990) (noting that the “[t]erm is more synonymous with

temporary than with permanent”). However, the intended meaning of “indefinitely”

—that the restrictions are permanent—was clear from the context of the letters that

Rote’s attorney and the doctors exchanged. Rote’s attorney first informed the doctors

that there was a question about “whether the restrictions . . . were only temporary or

were intended to be permanent,” before asking whether the restrictions should be

continued “indefinitely.” The doctors’ affirmative responses, when read in context,

show that the restrictions are permanent, not temporary. Moreover, the doctors

resolved any doubt about their intent in their subsequent letters. Dr. Neff responded

4

“[T]he financial conflict of interest present whenever an insurer both evaluates

claims for benefits and pays granted claims . . . does not change the standard of review

but may be relevant in determining whether the insurer abused its discretion.” Jones

v. Unum Provident Corp., 596 F.3d 433, 438 (8th Cir. 2010). Because we would find

an abuse of discretion in Titan’s denial of benefits even without considering this

conflict of interest, we need not elaborate on the standard of review applicable here.

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affirmatively to a later question from Rote’s attorney asking whether the work

restrictions were “intended to be permanent restrictions.” And Dr. Sciorrotta wrote

that Rote’s restrictions “were felt to be of a permanent nature.” Notwithstanding

Titan’s strained reading of the responses the doctors gave to the question whether the

restrictions should be continued “indefinitely,” it is plain that the doctors have

consistently maintained that Rote’s work restrictions are permanent. Under these

circumstances, we conclude that Titan’s decision denying Rote’s application for

disability benefits was not based on “substantial evidence.” See Schatz, 220 F.3d at

949. We therefore affirm the district court’s decision holding that Titan abused its

discretion.5

Turning to the attorney’s fee award, Titan first argues that an award of any

attorney’s fees is inappropriate here. “This Court will not overturn a District Court’s

decision regarding attorneys’ fees absent an abuse of discretion.” Sheehan v.

Guardian Life Ins. Co., 372 F.3d 962, 968 (8th Cir. 2004). When examining whether

to award attorney’s fees in an ERISA case, courts are to consider:

(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; (3)

whether an award of attorneys’ fees against the opposing parties could

deter other persons acting under similar circumstances; (4) whether the

parties requesting attorneys’ 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’

positions.

5

Titan also argues that we should evaluate its denial of benefits using the factors

enumerated in Finley v. Special Agents Mutual Benefit Ass’n, 957 F.2d 617, 621 (8th

Cir. 1992). However, this case does not involve interpretation of the plan’s terms as

in Finley; the definition of “permanently disabled” is not in dispute. Therefore, Finley

is not applicable.

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Lawrence v. Westerhaus, 749 F.2d 494, 496 (8th Cir. 1984) (per curiam). However,

“the ‘five factors’ set forth by Westerhaus are by no means exclusive or to be

mechanically applied.” Martin v. Ark. Blue Cross & Blue Shield, 299 F.3d 966, 972

(8th Cir. 2002) (en banc). 

We find no abuse of discretion in the district court’s decision to award

attorney’s fees. As the district court noted, “[t]his was not a close case.” Titan relied

on a hypertechnical reading of the medical evidence and ignored the doctors’ attempts

to clarify their opinions. Additionally, there was evidence that Titan attempted to

frustrate Rote’s ability to move the claims process forward by repeatedly ignoring her

requests for documents. While no evidence has been presented regarding the second

or third factors, and while the fourth factor favors Titan in that Rote’s suit will only

benefit her own application for benefits, we nonetheless conclude that in light of all

the “relevant considerations,” id., the weight of the first and fifth factors is sufficient

here to show that the district court did not abuse its discretion in awarding attorney’s

fees.

Finally, we turn to Titan’s argument that, even if an award of some attorney’s

fees were appropriate, the fees incurred during Rote’s first suit and during the

administrative proceedings occasioned by the district court’s remand order should not

have been awarded. The statute governing attorney’s fee awards under ERISA

provides: “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). According to Titan, the first suit

and the subsequent administrative proceedings were “pre-litigation” and not part of

the current “action” within the meaning of the statute. Therefore, Titan argues, the

district court may not award fees incurred before the second lawsuit. Whether

attorney’s fees incurred during the earlier proceedings are recoverable is a question

“of statutory interpretation, which we review de novo.” Parke v. First Reliance

Standard Life Ins. Co., 368 F.3d 999, 1010 (8th Cir. 2004).

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As an initial matter, Titan incorrectly portrays the relationship between Rote’s

first and second suits, asserting that they were separate cases and therefore separate

actions such that Rote cannot now recover fees incurred during the first suit. In

Gerhardt v. Liberty Life Assurance Co. of Boston, 574 F.3d 505 (8th Cir. 2009), we

dismissed an appeal from a district court’s order remanding a benefits claim to the

administrator for further proceedings, id. at 506-07. We held that this was not a final

order under 28 U.S.C. § 1291, even though the docket listed the case as terminated

and the district court did not explicitly note it was retaining jurisdiction. Gerhardt,

574 F.3d at 511. The district court’s initial remand order here is nearly identical to the

one in Gerhardt, and for the reasons outlined in Gerhardt, see id. at 511-12, we reject

Titan’s claim that the district court did not retain jurisdiction over Rote’s claim. 

Because the two suits were the continuation of one “action,” Rote can recover fees

incurred during the first suit.

Since Rote’s two suits are part of the same “action,” this case is distinguishable

from those on which Titan relies, Parke and Spearman v. Motorola Disability Income

Plan, 279 F. Supp. 2d 1047 (S.D. Iowa 2003). In Parke, we held that attorney’s fees

incurred during pre-litigation proceedings before the plan administrator could not be

recovered, even though those proceedings were necessary to exhaust a benefits claim,

because that pre-litigation work was not part of the “action” within the meaning of the

statute. 368 F.3d at 1011. The pre-litigation administrative proceedings at issue in

Parke were “neither necessary for enforcement of a judicial decree nor so closely

connected to the resolution of the judicial action as to fall within the scope of

[Sullivan v. Hudson, 490 U.S. 877 (1989)] and [Pennsylvania v. Delaware Valley

Citizens’ Council for Clean Air, 478 U.S. 546 (1986)],” cases where the Supreme

Court awarded attorney’s fees under other statutes for work performed during

administrative proceedings. Parke, 368 F.3d at 1011. Unlike the fees at issue in

Parke, the disputed fees here were not incurred pre-litigation, but rather after a courtordered remand. We are also not persuaded that this case should be resolved

identically to Spearman, where the district court refused to award attorney’s fees

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incurred during a court-ordered remand to allow the plaintiff to administratively

exhaust her ERISA claim. 279 F. Supp. 2d at 1052. Unlike the situation in Spearman,

the district court’s remand order here was not occasioned by Rote’s failure to satisfy

the prerequisites for bringing her claim in district court. 

Instead, Rote’s case is more closely analogous to those where courts have found

that fees incurred during an administrative remand were appropriate. See, e.g.,

Hudson, 490 U.S. 877; Delaware Valley, 478 U.S. 546. “Where the administrative

proceedings are ordered by the district court and where that court retains jurisdiction

over the action during the pendency of the administrative proceedings, we hold that

ERISA authorizes the award of associated costs.” Peterson v. Cont’l Cas. Co., 282

F.3d 112, 122 (2d Cir. 2002) (upholding an award of similar fees incurred during a

remand to the plan administrator); cf. Graham v. Hartford Life & Accident Ins. Co.,

501 F.3d 1153, 1163 (10th Cir. 2007) (“[W]e do not intend to create a per se rule that

attorney’s fees are inappropriate whenever a district court decides to remand a claim

to the plan administrator rather than ordering benefits directly.”). We therefore affirm

the district court’s attorney’s fee award.6

The judgment of the district court is affirmed.

______________________________

6

Titan does not argue that, once the district court determined that an attorney’s

fees award was permissible under the statute, the court abused its discretion in

determining whether to award fees incurred during Rote’s first suit or the

administrative remand. Nor does Titan argue the court abused its discretion in

determining the amount of fees to award generally. 

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