IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF OHIO

WESTERN DIVISION

SCOTT D. DALESANDRO and DIANE :

NOONAN, on behalf of themselves and :

others, :

:

Plaintiffs, :

: Case No. C-1-01 109

vs. :

: Judge Sandra S. Beckwith

INTERNATIONAL PAPER COMPANY, :

:

Defendant. :

DEFENDANT’S RESPONSE TO PLAINTIFF’S SUPPLEMENTAL MOTION 

FOR ATTORNEYS’ FEES AND EXPENSES1

Defendant International Paper opposes Plaintiffs’ motion for attorneys’ fees, 

expenses, interest and incentive awards in significant part, and respectfully requests the 

Court deny the requested amounts. Plaintiffs' requests should be denied or reduced 

substantially for the following reasons: 

I. Attorneys’ Fees, Costs, And Expens es Are Not Recoverable For Vacation Pay 

Issues

Plaintiffs’ request for fees, costs, and expenses related to their belated claim for 

vacation pay is not compensable because a company’s policy of paying its discharged 

employees for their unused vacation time is not an ERISA claim, and therefore ERISA’s 

fee-shifting provision does not apply. Massachusetts v. Morash, 490 U.S. 107, 109, 114, 

109 S. Ct. 1668, 104 L. Ed. 2d 98 (1989). Vacation plans in which a single employer 

pays benefits from its general assets do not constitute ‘employee benefit plans’ within the 

 

1 Counsel for International Paper attempted to file this document on September 16, 2004 over 

several hours, but there were technical difficulties with the Court's website. Therefore, the 

document is being filed today, and opposing counsel has no objection.

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 1 of 8
2

meaning of ERISA. Morash, 490 U.S. at 114 (citing 29 C.F.R. § 2510.3-1(b)(3)); Adams 

v. Avondale Indus., 905 F.2d 943, 951 (6th Cir. 1990). “Unlike normal severance pay, the 

employees’ right to compensation for accrued vacation time is not contingent upon the 

termination of their employment,” and its inclusion as part of Policy #828 does not 

convert this payroll practice to a welfare benefit plan. Morash, 490 U.S. at 120. Because 

such vacation plans are not covered by ERISA, the Plaintiffs may not claim entitlement 

to attorneys’ fees, costs, or expenses under ERISA’s fee-shifting provision. 

Plaintiffs’ request for fees, costs, and expenses related to vacation pay is not 

compensable, even if covered by ERISA, because Plaintiffs were not the prevailing party 

on this issue and should not be rewarded for belatedly raising and disputing the issue at 

this late juncture in the litigation. Section 502 of ERISA, 29 U.S.C. § 1132, provides that 

“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 cost of action to either 

party.” 29 U.S.C. § 1132(g)(1). Before exercising this discretion under a fee-shifting 

statute, the district court must examine five factors: 1) the degree of the opposing party’s 

culpability or bad faith; 2) the opposing party’s ability to satisfy an award of attorneys’ 

fees; 3) the deterrent effect of an award on other persons under similar circumstances; 4) 

whether the party requesting the fees sought to confer a benefit on all participants and 

beneficiaries of an ERISA plan or to resolve a significant legal question regarding 

ERISA; and 5) the relative merits of the parties’ positions. Schwartz v. Gregori, 160 F.3d 

1116, 1119 (6th Cir. 1998), citing Secretary of Labor v. King, 775 F.2d 666, 669 (6th Cir. 

1985). 

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 2 of 8
3

As set forth above, this vacation pay dispute did not involve a significant legal 

question regarding ERISA. In addition, however, the fifth and final factor should be 

decisive in this instance, and preclude an award of fees. The Supreme Court has advised 

that "district courts should exercise their equitable discretion...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." Hensley v. 

Eckerhart, 461 U.S. 424, 435, 103 S. Ct. 1933, 76 L. Ed. 2d 40 (1983). Many circuit 

courts have imposed a "prevailing party" limitation on the availability of attorneys' fees

under ERISA. See Martin v. Blue Cross & Blue Shield, 115 F.3d 1201, 1210 (4th Cir.

l997) and cases cited therein. As this Court stated in its January 13, 2004 Order:

“Plaintiffs have not properly raised claims for recovery of vacation pay in this lawsuit,” 

and therefore “Plaintiffs motion for authorization to mail a supplemental notice [for 

vacation pay] to the class is not well-taken and is DENIED.” (Jan. 13, 2004 Order at p. 

7.) The merits of Plaintiffs’ position was accordingly lacking, and because Plaintiffs did 

not prevail on this issue, the fees, costs, and expenses generated by Plaintiffs in pursuit of 

this late-filed motion should not be shifted to Defendant.

In addition, pursuant to Fed. R. Civ. P. 54(d), costs shall be allowed only “to the 

prevailing party.” Because Plaintiffs were not the prevailing party on this issue, they are 

not entitled to recovery of any costs incurred in litigation of this issue.

Plaintiffs’ request for fees, costs, and expenses related to this issue, including but 

not limited to legal research (time and expenses), conferences, drafting and responding to 

discovery, drafting of an amended class notice, briefing of this issue, and drafting of 

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 3 of 8
4

notices to class members of the Court’s decision, beginning October 27, 2003 through 

March 5, 2004, should accordingly be rejected.

II. Attorneys’ Fees, Costs, and Expenses Are Not Recoverable for Plaintiff’s 

“Expert Witness”

Plaintiffs’ counsel has submitted a lengthy analysis by economists opining on the 

enhanced value of pensions for a group of twenty Class Members. This report is 

unnecessary, unsupported, and self-serving and Defendant should not be held responsible 

for the expense incurred for its production. These pension amounts will be calculated by 

the administrator of the pension plan and paid as they come due. Plaintiffs’ counsel has 

calculated these potential future amounts only for the purpose of boosting the potential 

damage award and thus their contingent attorneys’ fees. Their request for reimbursement 

for the expense of this report, totaling $4775.00, as well as the attorneys’ fees incurred in 

consultation and conferences regarding this report, beginning approximately July 26, 

2004 through August 18, 2004, should be denied. To the extent Plaintiffs’ counsel has 

block billed entries concerning this analysis with other issues, these entries should be 

denied in their entirety. 

In addition, this report is clearly insufficient under the requirements of the Federal 

Rules, as it fails to meet the requirements of Fed. R. Civ. P. 26(a)(2)(B). Plaintiffs have 

failed to submit any qualifications or background for these “experts,” and the report fails 

to provide a list of the information or documents utilized, or to explain the basis for the 

opinions or calculations. The report should accordingly be rejected in its entirety as 

without foundation or relevance in this action.

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 4 of 8
III. The Estimated Amount of the Enhanced Value of Pensions in the “Expert 

Report” Should Be Excluded From the Common Fund for Purposes of 

Determining Reasonable Attorneys’ Fees

IP objects to Plaintiffs’ request to include estimated future pension benefits in the 

common fund for the purpose of determining attorneys’ fees, and requests the Court to 

exclude these potential benefits. While Plaintiffs’ counsel has submitted a lengthy 

analysis by economists opining on the enhanced value of pensions for a group of twenty 

Class Members, these amounts are speculative and the submitted report is unsupported 

and self-serving. These pension amounts will necessarily vary over the years and cannot 

be determined with any reasonable amount of certainty because they are dependent upon

numerous factors, including when each of the individual Class Members retires. 

Defendant should not be held to the unsubstantiated “guesstimates” of potential future 

pension benefits made in the Plaintiffs’ report. Defendant should also not be held to the 

results of this post-judgment report which it has not had an opportunity or time to review, 

analyze, or refute, or to depose the economists regarding their basis and method for 

calculation. 

In addition, as stated above, this report is clearly insufficient under the 

requirements of the Federal Rules, as it fails to meet the requirements of Fed. R. Civ. P. 

26(a)(2)(B), and it should accordingly be rejected as without foundation or relevance in 

this action. 

IV. Plaintiff’s Request for a 1.5 Multiplier Should Be Denied

Plaintiff’s request for a 1.5 multiplier should be denied for the reasons set forth in 

Defendant’s Response in Opposition to Plaintiff’s Motion for Attorneys’ Fees, Expenses, 

Interest, and Incentive Awards filed in opposition to Plaintiff’s original motion for fees 

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 5 of 8
6

up to and including July 31, 2003, and Defendant incorporates by reference Section II.D., 

pages 21 – 24 of its Response. 

IV. Plaintiff’s Request for Expenses Incurred Should Be Denied in Part

Defendant incorporates by reference Section II.E., page 25, of its previous 

Response in Opposition to Plaintiff’s Motion for Attorneys’ Fees, Expenses, Interest, and 

Incentive Awards, with regard to the expenses claimed by Plaintiffs that are not 

recoverable. 

V. Plaintiff’s Request for Prejudgment Interest Should Be Rejected

Defendant incorporates by reference Section III., pages 26-28, of its previous 

Response in Opposition to Plaintiff’s Motion for Attorneys’ Fees, Expenses, Interest, and 

Incentive Awards, with regard to prejudgment interest claimed by Plaintiffs. Defendant 

further objects to Plaintiffs’ request for prejudgment interest on the estimated future 

pension benefits in its entirety on two additional grounds: 1) the estimated prejudgment 

interest by the economists hired by Plaintiffs is speculative, unsupported, and deficient 

and inadmissible under the Federal Rules as set forth above and in Defendant’s Response 

to Plaintiff’s Report on the Results of the Notice to the Class for Entry of Final Judgment; 

and 2) these benefits are not currently owing or due, and interest may not begin to run 

until Defendant has breached any obligation to pay such benefits. "Plaintiffs must be 

able to present evidence that demonstrates the monetary value of that breach with 

reasonable certainty,” Walker v. Consumers Power Company, 824 F.2d 499 (6th Cir. 

1987), which they cannot do. 

Defendant has at all times taken the position based on the terms of its Retirement 

Plan that eligible Class Members cannot start retirement benefits until after the end of his 

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 6 of 8
7

or her employment with Smart Papers. This position is clearly stated in the Class Notice 

issued in this action. Since no payment is currently due to the Class Members, no breach 

has occurred to date, and therefore no interest or damages have accrued. In addition, 

because the amount of each individual’s pension cannot be determined with any measure 

of certainty until their retirement, prejudgment interest similarly cannot be ascertained. 

Defendant has agreed that should the judgment in this action be upheld on appeal, that it 

will recalculate and pay any and all pensions due under the Flex Six pension 

enhancement policy following the individual’s retirement from employment and pursuant 

to this policy. Since the purpose of prejudgment interest is to provide compensation to 

the winning party for the delay in obtaining his or her funds, no interest should be 

charged on funds that the Plaintiffs will only become entitled to in the future and that 

cannot be determined with any reasonable amount of certainty until the actual retirement 

date of each eligible individual. 

Respectfully submitted,

INTERNATIONAL PAPER CO.

By: s / Michael Roberts__________

 

COUNSEL FOR DEFENDANT

INTERNATIONAL PAPER CO.

Michael A. Roberts (OH Bar No. 0047129)

 Graydon Head & Ritchey, LLP

1900 5th 3rd Center

511 Walnut Street

Cincinnati, Ohio 45202

(513) 629-2799

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 7 of 8
8

W. Carter Younger (VSB 01147)

James P. McElligott, Jr. (VSB 014109)

(Admitted Pro Hac Vice)

McGuireWoods LLP

One James Center

Richmond, VA 23219

(804) 775-4363

CERTIFICATE OF SERVICE

I hereby certify that on this 17th day of September 2004, a true and complete copy 

of this document was delivered via electronic filing to Counsel for Plaintiff, Theresa L. 

Groh, Esq., and John C. Murdock at Murdock, Goldenberg, Schneider & Groh, L.P.A., 

700 Walnut Street, Suite 400, Cincinnati, Ohio, 45202.

s/ Michael A. Roberts

Case 1:01-cv-00109-SSB Document 72 Filed 09/17/2004 Page 8 of 8