Wessberg v. Unum Life Insurance Company of America
- John Tunheim
- 0:22-cv-00094
- U.S. District Court · District of Minnesota
- 21
In Wessberg v. Unum Life Insurance Company of America, Judge Tunheim ordered Unum to pay plaintiff Ann D. Wessberg a total of $741,085.31 in retroactive disability benefits and interest, plus $314,440.29 in attorney's fees and $2,698.15 in costs, after the court had previously ruled that Unum wrongfully terminated her long-term disability benefits.
Individuals who have long-term disability benefits administered through employer-sponsored benefit plans governed by ERISA, particularly those whose benefits have been terminated and who are seeking reinstatement and attorney's fees after successful litigation. Also relevant to attorneys litigating ERISA cases in the District of Minnesota regarding reasonable hourly rates and recoverable costs.
What happened
In Wessberg v. Unum Life Insurance Company of America (Civil No. 22-94), Ann D. Wessberg sued her long-term disability insurer, Unum Life Insurance Company of America, under a federal law called the Employee Retirement Income Security Act of 1974 (ERISA), which governs employer-sponsored benefit plans. The court had already ruled in July 2024 that Unum improperly cut off Wessberg's disability benefits after she was diagnosed with bilateral invasive breast cancer, and ordered Unum to reinstate those benefits and pay what it owed. The only remaining disputes concerned how much Unum owed in attorney's fees and costs.
The parties agreed that Wessberg was owed $663,234.14 in retroactive benefits (covering September 8, 2020 through July 16, 2024) plus $77,851.17 in prejudgment interest (interest that accrues before a court enters a final judgment), for a combined total of $741,085.31. On attorney's fees, Wessberg asked for $445,488.75 and Unum argued the amount should be only $93,603.59. The court used the standard 'lodestar' method — multiplying the number of hours reasonably worked by a reasonable hourly rate — and carefully examined the hourly rates of each attorney, the time spent on unsuccessful motions, whether billing entries were impermissibly vague, whether the case was overstaffed, and whether any work was purely clerical.
Judge Tunheim approved hourly rates of $390 (and later $200) for attorney Elizabeth Wright, $475 for attorney Christopher Daniels, and reduced attorney Michael Rothman's rates slightly to $550 per hour for hours billed at or above $585. The court cut by 50% the hours spent on motions that failed — specifically motions to expand the administrative record, compel discovery, and obtain a bench trial. It also reduced the overall fee total by 15% for excessive time spent drafting pleadings and motions, and applied a lower paralegal rate of $185 per hour to 16 hours of clerical work. On costs, the court excluded computer-aided legal research fees, postage and courier expenses, and data storage fees, allowing only $2,698.15 in costs. The final awards were $741,085.31 in benefits and interest, $314,440.29 in attorney's fees, and $2,698.15 in costs.
The detailed version
This opinion addresses the final monetary relief owed to plaintiff Ann D. Wessberg following the court's earlier ruling that defendant Unum Life Insurance Company of America ('Unum') improperly terminated her long-term disability benefits under ERISA (Employee Retirement Income Security Act of 1974). Judge John R. Tunheim of the U.S. District Court for the District of Minnesota presided.
Benefits and Prejudgment Interest
The parties were in agreement that Wessberg was owed $663,234.14 in retroactive benefits (September 8, 2020 through July 16, 2024) and $77,851.17 in prejudgment interest, totaling $741,085.31. The court ordered Unum to pay this undisputed amount.
Attorney's Fees — Legal Standard
The court applied the 'lodestar' method, multiplying the number of hours reasonably expended by a reasonable hourly rate. See Hensley v. Eckerhart, 461 U.S. 424 (1983). The court has substantial discretion in making this determination. Wessberg requested $445,488.75 in fees; Unum argued for no more than $93,603.59.
Hourly Rates
- Elizabeth Wright: $390/hour (before May 3, 2024) and $200/hour (from May 3, 2024 onward, after she left her prior firm). The court found this reasonable given her nearly four decades of litigation experience, including insurance defense work, and that $390 falls within the typical District of Minnesota ERISA range of $225–$400/hour. - Christopher Daniels: $475/hour. Found reasonable given his decades of complex commercial and insurance litigation experience. - Michael Rothman: Billed at $510/$585 (2021), $630 (2022–2023), and $675 (2024). The court found rates at and above $585/hour slightly elevated and reduced those hours to $550/hour, reflecting his extensive ERISA and insurance regulatory experience while aligning with prevailing local rates. - Unum's proposal of a flat $375/hour for all attorneys was rejected.
Hours Expended — Four Categories of Challenge
1. Unsuccessful Motions and Arguments (50% reduction): Unum sought to eliminate 215.8 hours related to unsuccessful Motions to Expand the Administrative Record, to Compel Discovery, and an attempt to obtain a bench trial. The court declined a 100% reduction because these issues shared a common core with the successful claims, but found that spending so many hours on these motions was slightly unreasonable given that de novo ERISA review is typically confined to the administrative record. The court applied a 50% reduction: PDK's 162.8 hours reduced by half (to 81.4 hours); Rothman's 53 hours reduced by half, yielding a $16,569 reduction in his fees.
2. Block-Billing (no reduction): Unum challenged over 35 time entries as block-billed (lumping multiple tasks into one entry) and sought a 15% reduction. The court found the billing records sufficiently specific and declined any reduction, though it discouraged the practice.
3. Excessive Billing: - Research (315 hours): No reduction. The court found the research topics were relevant and the complexity of the case justified the time. The court also noted the inconsistency of Unum arguing counsel was inexperienced (to reduce rates) while also arguing they spent too much time researching. - Drafting/Preparing Pleadings and Motions: The court found the total hours — including 438 hours on cross-motions for judgment on the administrative record and 112.65 hours on post-order activities — to be elevated compared to comparable ERISA cases. The court applied a 15% across-the-board reduction to the total fee award. - Overlawyering (no reduction): Three attorneys and paralegals staffed the case. The court found this was not inherently unreasonable, particularly because Wright (lowest rate) handled the bulk of work, and that roughly 37.5 hours of internal communications over two and a half years was not excessive.
4. Administrative/Clerical Tasks: The court declined to reduce fees for review of the 4,860-page administrative record, finding it necessary for building the case. However, it reduced the rate for 16 hours of routine clerical tasks (filing, scheduling, monitoring emails, etc.) to $185/hour (paralegal rate), resulting in a $5,652.50 total reduction ($4,005 from Rothman's fees, $1,647.50 from PDK's fees).
Fee Calculation Summary
After all individual reductions, the initial lodestar calculation was $369,929.75. The court then applied the 15% reduction for excessive drafting and preparation time, yielding a final attorney's fees award of $314,440.29. The court provided a breakdown by attorney: Wright ($203,204.40), Daniels ($8,044.19), Rothman ($88,490.95), and PDK paralegals Siegel and Rice ($10,818.80 and $3,881.95, respectively).
Costs
Wessberg sought $9,797.09; Unum argued for $430. - Computer-aided legal research (Westlaw/LexisNexis/PACER, $2,158.18): Excluded. Wessberg did not demonstrate that separately billing for such research is the prevailing community practice, and courts in this District have not permitted such recovery. - Costs related to unsuccessful motions ($2,268.15): Not excluded. The court had already reduced fees for these motions and declined to double-penalize. - Postage, courier, parking ($132.61): Excluded as not recoverable under 28 U.S.C. §§ 1821 and 1920. - Data storage ($4,807.15 for one gigabyte at $250/month): Excluded. Counsel provided no explanation justifying this level of storage for a case with a 4,359-page administrative record. - Recoverable costs: $2,698.15.
Final Order
Judge Tunheim ordered Unum to pay Wessberg (1) $741,085.31 in retroactive benefits and prejudgment interest, (2) $314,440.29 in attorney's fees, and (3) $2,698.15 in costs. Judgment was to be entered accordingly.
Reviewer note from the AI+
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