Court Orders Unum to Pay Six Figures in Attorneys’ Fees for Wrongful Termination of Long-Term Disability Benefits

In Graziano v. First Unum Life Insurance Company, No. 21-CV-2708 (PAC), 2024 WL 1175143 (S.D.N.Y. Mar. 19, 2024), New York Southern District Judge Loretta A. Preska granted Plaintiff’s motion for attorneys’ fees against Unum as the prevailing party in this ERISA benefits action.

By this lawsuit, Plaintiff alleged that Unum violated ERISA by improperly terminating his long-term disability (“LTD”) and life insurance premium waiver (“LWOP”) benefits. After a bench trial on a stipulated administrative record, the Court entered judgment in favor of Plaintiff for benefits accrued from January 3, 2020, through the close of the administrative record on November 10, 2020, and remanded to Unum for a benefits determination from November 11, 2020, onwards. In his fee motion, Plaintiff sought $402 in litigation costs and $221,039.25 in attorneys’ fees, which consisted of $198,635.25 in fees for the benefits litigation and $22,404 in fees for his attorneys’ fee request.

The Court first found that Plaintiff was entitled to reasonable attorneys’ fees because he was successful on the merits of his ERISA claim. Next, the Court looked to determine a presumptively reasonable fee award, reached by multiplying a reasonable hourly rate by the number of reasonably expended hours.

Plaintiff sought the following rates for his attorneys: $875 (founding partner); $675 (former partner and lead counsel); $600 (former associate); $480 (associate), and $350, $325, and $275 (three paralegals). In support of the motion, Plaintiff’s counsel submitted affidavits from counsel and from other attorneys practicing in the District attesting to the reasonableness of these rates, as well as outlining the experience and reputation of both the Firm and the billing parties. Unum sought a 23% reduction in the attorney rates and asked that paralegal fees be restricted to $50 to $200 per hour, citing cases where such rates were found to be reasonable.

Analyzing the parties’ arguments and evidence, the Court found that Plaintiff’s proposed rates were reasonable once a 10% reduction was applied. The Court noted that one of the most important factors that favored finding the rates reasonable was that hundreds of the Firm’s clients are willing to pay these rates, and the evidence demonstrated that the Firm and its attorneys specialize in high-stakes ERISA litigation and the Firm is highly regarded in the relevant legal community and by their clients.

With regard to the number of hours billed, the Court found that most of the time expended was reasonable and supported by clear, discernable time entries, with proper delegation of work to associates and paralegals as opposed to being performed by the partners. Finding only minimal issues concerning vague entries, duplicative work, and some instances of failure to delegate appropriately, the Court applied a modest 5% reduction in the number of hours and ordered a total fee award of $187,080.65, plus $402 in costs.

If Unum or your insurer has denied your disability insurance claim, contact us for assistance.