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Justices Signal Interest in ERISA’s Attorneys’ Fees Provision

March 17, 2020, 7:54 PM

The U.S. Supreme Court on Monday expressed interest in deciding how much success a benefit plan participant must achieve in a lawsuit over denied benefits in order to receive attorneys’ fees under the Employee Retirement Income Security Act.

The justices instructed Humana Health Plan of Texas Inc. to respond to a petition filed by a plan participant raising questions under ERISA’s attorneys’ fee provision. This move by the justices signals that someone at the court is interested in the dispute, and it increases the chances the case will be heard from 1% to 5%, according to a Bloomberg Law analysis.

The case stems from a dispute between Humana and a teenager with an eating disorder who sought coverage for several months she spent at a residential treatment facility in Utah. Humana initially won in court, but the U.S. Court of Appeals for the Fifth Circuit revived the lawsuit on appeal after finding the district court gave too much deference to the insurer. In so ruling, the Fifth Circuit effectively overturned a 1991 insurer-friendly decision that made it harder for patients challenge benefit denials in court.

Despite this ruling, Humana won again at the district court level, and the Fifth Circuit affirmed in 2019. In that decision, the Fifth Circuit agreed that the teenager wasn’t entitled to attorneys’ fees because she didn’t achieve “some degree of success” on the merits of her claim for benefits.

The teenager urged the Supreme Court to review how the Fifth Circuit handled her fee request. In her view, she achieved enough success to warrant a fee award under ERISA, because her lawsuit led to a “ground-breaking decision” overruling prior case law and making it easier for people in Texas, Louisiana, and Mississippi to challenge benefit denials in court.

The Fifth Circuit’s decision also conflicts with a 2014 ruling by the First Circuit, which said a plan participant who obtained a remand of her benefits lawsuit could receive attorneys’ fees under the statute, the teenager argued.

The teenager is represented by Johnson & Raval and Kantor & Kantor LLP.

The case is Ariana M. v. Humana Health Plan of Tex., Inc., U.S., No. 19-980, response requested 3/16/20.

To contact the reporter on this story: Jacklyn Wille in Washington at jwille@bloomberglaw.com

To contact the editors responsible for this story: Rob Tricchinelli at rtricchinelli@bloomberglaw.com; Nicholas Datlowe at ndatlowe@bloomberglaw.com

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