United States District Court, D. Connecticut
JANICE C. AMARA et al, individually, and on behalf of others similarly situated, Plaintiffs,
CIGNA CORP. and CIGNA PENSION PLAN, Defendants.
RULING ON MOTION FOR ATTORNEYS' FEES, INCENTIVE
AWARDS, AND EXPENSES
Bond Arterton, U.S.D.J.
have moved ([Doc. # 410]) for approval of their
attorneys' fees, proposed incentive awards, and expenses
in this class action brought under the Employee Retirement
Income Security Act ("ERISA"). Having previously
ruled on the methodology for calculating attorneys' fees,
([Doc. # 550]), and having considered Defendants'
response to the Motion, ([Doc. # 421]), Plaintiffs'
Reply, ([Doc. # 424]), and Defendants' Updated Present
Value Calculation, ([Doc. #551]), the Court now rules on
Plaintiffs' Motion for Attorneys' Fees.
seek attorneys' fees based on the "percentage of the
fund" or the lodestar method in class actions that
produce common fund recoveries. See Goldberger v.
Integrated Resources, 209 F.3d 43, 47 (2d Cir. 2000). In
this case, an award of attorneys' fees based on the
percentage of the fund method "directly aligns the
interests of the class and its counsel." Wal-Mart v.
Visa U.S.A. Inc., 396 F.3d 96, 122 (2d Cir. 2005).
applying the percentage of the fund method, it is appropriate
to award attorneys' fees as a percentage of "the
total funds made available," not "on the basis of
claims made against the fund." Masters v. Wilhelmina
Model Agency, Inc., 473 F.3d 423, 437 (2d Cir. 2007). In
Masters, the Second Circuit recognized that
"[t]he entire Fund, and not some portion thereof, is
created through the efforts of counsel at the instigation of
the entire class." Id.
parties' calculations of actual individual relief
reflecting a value of the "A" recovery is
significantly disputed. Plaintiffs calculate the recovery at
$280.6 million; Defendants' updated present value
calculation reflects a total value of $184, 456, 124 in
relief to the class. ([Doc. # 551].)
addition to the monetary common fund recovery under the
"qualified" portion of Cigna's Pension Fund,
class members received additional non-monetary relief in the
form of the August 2017 ERISA Section 204(h) notice
disclosing the "true effect on their retirement
benefits" resulting from the cash balance conversion.
Moreover, Plaintiffs represent that almost 400 class members
will be entitled to additional benefits from Cigna's
Supplemental Pension Plan.
Goldberger v. Integrated Resources, 209 F.3d 43, 47
(2d Cir. 2000), "the traditional criteria in determining
a reasonable common fund fee, includ[e]: (1) the time and
labor expended by counsel; (2) the magnitude and complexities
of the litigation; (3) the risk of the litigation; (4) the
quality of representation; (5) the requested fee in relation
to the settlement; and (6) public policy
considerations." Id. at 50.
the relevant Goldberger factors weigh in favor of
the requested 17.5% fee award. With respect to the first and
fourth factors, Plaintiffs' counsel have vigorously
litigated this case for seventeen years before the district
court, the Second Circuit, and the Supreme Court, expending
over 12, 000 hours. With respect to the second factor, the
case raised novel questions of law and directly affected tens
of thousands of class members. Significantly, the Supreme
Court held that that the remedies ordered by the district
court-including (1) "reformation of the terms of the
plan in order to remedy the false or misleading information
CIGNA provided[, ]" (2) equitable estoppel, and (3)
surcharge all "f[e]ll within the scope of the term
'appropriate equitable relief in [ERISA] §
502(a)(3)." CIGNA Corp. v. Amara, 563 U.S. 421,
440-42 (2011). As two observers noted, while the "the
U.S. Department of Labor (DOL)" had long "taken the
position that a much broader interpretation of section
502(a)(3) is warranted .... [l]ower courts ... were unwilling
to adopt the DOL's position, believing that the Supreme
Court's jurisprudence had conclusively narrowed the scope
of section 502(a)(3)." Peter K. Stris & Victor
O'Connell, ERISA & Equity, 29 ABA J. Lab.
& Emp. L. 125, 128 (2013). But "[i]n a surprise to
many, the Supreme Court did what no lower court had been
willing to do: it made clear in CIGNA Corp. v. Amara
that the DOL's position [wa]s correct." Id.
As a result, they concluded, "in many areas,
Amara now permits plaintiffs to seek meaningful
third Goldberger factor here is inapplicable as it
relates to settled claims. With respect to the fifth factor,
the requested fee here is reasonable in relation to the value
of the total monetary recovery and in line with or below
earlier fee awards.
counsel's requested fee award of 17.5% of the increased
benefits is lower than percentage awards in other ERISA class
actions in this Circuit. In Haddock v. Nationwide
Financial Services, Inc., No. 01-cv-1552 (SRU) (D. Conn.
Apr. 10, 2015), Judge Underhill approved a 35% award of $49
million from a $140 million recovery, a lower financial
recovery than here. See also In re Colgate-Palmolive Co.
ERISA Litig., 36 F.Supp.3d 344, 353 (S.D.N.Y. 2014) (25%
award from a $45.9 million common fund); Board of
Trustees of the AFTRA Ret. Fund v. JPMorgan Chase Bank,
2012 WL 2064907, *3 (S.D.N.Y. June 7, 2012) (25% of $150
million common fund); Tedesco v. Bank of America,
No. 3:07 CV 1640 (JCH) (D. Conn. June 2, 2011) (19% of a $21
million settlement); Richards v. Fleet Boston, No.
3:04CV1638 (JCH) (D. Conn. Oct. 15, 2008) (21% of a $83.5
million settlement); In re AOL Time Warner, Inc. ERISA
Litig., 2007 WL 3145111, at *1 (S.D.N.Y. Oct. 26, 2007)
(17.9% of $100 million recovery).
also consistent with percentage-of-fund fee awards in other
jurisdictions. See, e.g., Cooper v. IBM Personal Pension
Plan, 2005 WL 1981501, at *2 (S.D. 111. Aug. 16, 2005)
(awarding 29% of first $250 million recovery; plus 25% of
next $64 million); Berger v. Xerox Corp. Ret. Income
Guar. Plan, 2004 U.S. Dist. LEXIS 1819, at *5-7 (S.D.
111. Jan. 22, 2004) (29% of $240 million recovery).
percentage-of-the-fund method is used, a lodestar
"cross-check" based on a summary of hours tests the
reasonableness of the percentage. Wal-Mart, 396 F.3d
at 123. While not required, using the lodestar method as a
discretionary cross-check further demonstrates that the fee
that Class counsel seeks is reasonable. A 17.5% award from a
$184, 456, 124 common fund- the lower of the two numbers put
forth by the parties in valuing the remedy payments to class
members for the purposes of calculating attorneys'
fees-would be $32, 279, 821.70. Based on the number of Class
counsel's hours in the original fee motion, which results
in a $6, 794 million lodestar, the 17.5% requested award
equates to a multiplier of 4.75. With a 14% increment for
additional hours over the past two and one-half years and a
10% increment for higher hourly rates over the same period,
the adjusted lodestar is $8, 513 million, (Bruce Suppl. Decl.
¶ 2 [Doc. #518-2]), which equates to an implied
multiplier of 3.79 on the adjusted lodestar.
implied multipliers are in line with other comparable complex
ERISA cases. See, e.g., In re Colgate-Palmolive, 36
F.Supp.3d 344, 353 (S.D.N.Y. 2014) (multiplier of "five
... is on the high end" but "not
unreasonable," observing that in fifty-three ERISA cases
cited by the plaintiffs, "the implied multiplier ranged
from less than one to eight times the lodestar, and nine
cases had multipliers greater than four"); Williams
v. Rohm & Haas Pension Plan, 658 F.3d 629, 635 (7th
Cir. 2011) (29% award implied multiplier of 5.85); Kifafi
v. Hilton Hotels Retirement Plan, 999 F.Supp.2d 88, 104
(D.D.C. 2013) (15% award implied multiplier of eight).
with respect to the sixth Goldberger factor, public
policy weighs in favor of recognizing the risk and heretofore
uncompensated labor expended by Plaintiffs' ...