United States Court of Appeals FOR THE EIGHTH CIRCUIT

___________ No. 96-2932

___________ Jean A. McIntosh, An Individual, * and Harding & Ogborn, P.C., A * Partnership of Nebraska and * Colorado Professional Corporations, * * Appellants, * Appeal from the United States * District Court for the District v. * of Nebraska. * Pacific Holding Company, and * Pacific Holding Company Employee * Welfare Benefit Plan, * * Appellees. *

___________ Submitted: April 17, 1997 Filed: August 8, 1997

___________ Before WOLLMAN, JOHN R. GIBSON, and MORRIS SHEPPARD ARNOLD , Circuit Judges.

___________ MORRIS SHEPPARD ARNOLD, Circuit Judge. Je an A. McIntosh and her counsel appeal from a judgment denying their claim for legal fees for work performed in a tort action to recover from third parties money that was ultimately reimbursed to Pacific Holding Compa ny Employee Welfare Benefit-2-

Plan (t he "Plan"). We reverse the district court and remand for the determination o f wh ether an attorney's fee is appropriate in the circumstances of this case and, if so , what its amount should be.
I. This case arises from an auto accident tha t left Ms. McIntosh's daughter gravely injured. The daughter's medical expenses, exceeding $500,000, were covered under the P lan, which was governed by the Employee Retirement Income Security Act, see 29 U.S.C. §§ 1001-1461. The Plan contract included fairly standard language as t o both subrogatio n and reimbursement rights, but was silent on the subject of attorney's fees. Ms. McIntosh, acting through her attorney, who was hired on a contingenc y basis, initiated two actions against the tortfeasor, one for herself and one for he r da ughter. She ultimately settled with two insurance companies for a total of abou t $250,00 0, and the suits against the tortfeasor, who was determined to be judgment

proof, were dismissed. Ms. McIntosh then sued the Plan in federal court seeking a d eclaratory judgment that the Plan had no reimbursement right to the $250,000. This action did not catch the Plan unaware, because the parties had exchanged co rrespondence outlining their views on what their respective rights were to any recovery from a third party. The Plan , indeed, had notified the relevant insurance companies by letter of its opinion that any pa yment to Ms. McIntosh would not relieve them of liability to the Plan, and so th e insurance companies paid the sett lement into escrow. We ultimately upheld the Plan's right to reimbursement. See McIntosh v. Pacific Holding Co. , 992 F.2d 882, 885 (8th Cir. 1993), cert. denied , 510 U.S. 965 (1993).
Inthe present action, the plaintiffs seek an award of part of the settlemen t amount as attorney's fees. The district court denied the claim.-3- II. We have recently d ecided a case that we believe governs the one before us. In Wal ler v. Hormel Foods Corp. , Nos. 96-2080/2231, slip op. at 8 (8th Cir. July 17 , 1997), w e held that federal common law gives an action for attorney's fees i n cir cumstances like the present ones, and in an amount equal to "the value of [th e claimant's] legal services to the Plan " (emphasis in original). The district court therefore erred in holding that, as a matter of law, no such fee was available. The plai ntiffs argue in the first instance that the attorney should receive the fee provided for in the contingency contr act between Ms. McIntosh and her attorney. But as we noted in Waller , slip op. at 9, this would be appropriate only if the plaintiffs can show that the Plan would have made the same arrangement that Ms. McIntosh did if it had itself engaged a lawyer to pursue a cas e against the tortfeasor. In the absence of such a showin g, the award should be "based on counsel's actual time devoted to th e matter." Id. Of course, time devoted to Ms. McIntosh's efforts to defeat the Plan' s subrogation rights is not compensable. In the present case, thePlan asserts that the relevant insurance companies were willing t o settle for the policy limits before, or soon after, the litigation against the m was b egun. If that is so, that fact becomes a relevant datum in determining th e appropriate amount of the fee. Because the district court has made no findings on these and other fa ctual matters that may become relevant to the matter of deciding on a proper fee, we must remand the case for further proceedings.
III. For t he reasons indicated, we reverse and remand for further proceedings no t inconsistent with the principles outlined in this opinion.-4-

A true copy.
Attest: CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.