Opinion ID: 1237181
Heading Depth: 2
Heading Rank: 1

Heading: Culpability or Bad Faith

Text: The district court conceded that its prior decisions made no specific finding of bad faith or culpable conduct on the part of Honeywell. LaForest v. Honeywell Int'l, Inc., No. 03 Civ. 6248T, 2006 WL 3491213, at , 2006 U.S. Dist. LEXIS 87039, at  (W.D.N.Y. Dec. 1, 2006) (LaForest Order). It nonetheless found that this factor weighed in plaintiffs' favor because Honeywell complied reluctantly with the court's orders, which pertained to the LMRA claim, as manifested by Honeywell's continuing to litigate, after issuance of the LMRA judgment, how to structure the relief sought. But we have never held that mounting a defense rises to the level of culpable conduct under Chambless. Cf. United States v. Seltzer, 227 F.3d 36, 40 (2d Cir.2000) (observing that zealous advocacy, absent bad faith, is insufficient for imposition of sanctions against attorney). Moreover (as explained in the Court's opinion), the district court based its culpability analysis on Honeywell's conduct in litigating the LMRA claim, a statute that does not provide for the award of attorneys' fees. The district court made no finding of culpability or bad faith in connection with the ERISA claim. The majority elects to remand to permit the district court to clarify its position on this issue. I believe that remand is gratuitous because Honeywell manifestly acted in good faith when it took the position (justified by our precedents) that plaintiffs failed to state a cognizable ERISA claim. See Salovaara v. Eckert, 222 F.3d 19, 29-30 (2d Cir.2000) (declining to find bad faith against party whose reading of ERISA statute was neither frivolous nor entirely devoid of merit). It is in fact very difficult to say what the ERISA claim here may be, considering the lively questions as to whether the Guaranty is an ERISA plan, see Fort Halifax Packing Co. v. Coyne, 482 U.S. 1, 11, 107 S.Ct. 2211, 96 L.Ed.2d 1 (1987), and whether Honeywell is an ERISA employer, see Greenblatt v. Delta Plumbing & Heating Corp., 68 F.3d 561, 575-76 (2d Cir.1995). The district court clearly erred in weighing this factor in plaintiffs' favor.