Opinion
Case No. 5:05CV2808.
April 7, 2006
ORDER [RESOLVING DOC. 6].
This action is before the Court upon defendant's Motion to Dismiss (Doc. 6). The Court has reviewed the memorandum in support, memorandum in opposition (Doc. 11), and reply memorandum (Doc. 17); and has considered the oral statements of counsel and the parties offered during the Case Management Conference ("CMC") held on March 28, 2006. The Court will grant the motion for reasons other than those that have been articulated in the memoranda in support.
The Court announced its decision to grant the motion at the CMC. Thereupon, the defendant stated that he would voluntarily withdraw his counterclaim against the plaintiff.
On December 6, 2005, the plaintiff filed a Complaint (Doc. 1) seeking declaratory, injunctive and monetary relief under Section 502(a)(3) of the Employee Retirement Income Security Act of 1974 ("ERISA"), 29 U.S.C. § 1132(a)(3), and state law. On January 27, 2006, the defendant filed a four-count Counterclaim (Doc. 5).
The Court will not address the plaintiff's argument that the Trust agreement required the defendant to return all trust property because the parties agree that the defendant has already returned copies of the audio recordings that he made of the June 11, 2005 and June 30, 2005 Trustee Meetings. Defendant's request to dismiss that part of the complaint will, therefore, be granted on mootness grounds. Plaintiff's remaining claim under ERISA is for legal fees.
ERISA "confers broad discretion on a district court in making the award of attorney's fees." Secretary of Dept. of Labor v. King, 775 F.2d 666, 669 (6th Cir. 1985); see also 29 U.S.C. § 1132(g)(1) ("In any action under this subchapter . . . by a . . . fiduciary, the court in its discretion may allow a reasonable attorney's fee and costs of action to either party."). A court generally looks to the following factors in considering an award of attorney's fees in an ERISA action:
(1) the degree of the opposing party's culpability or bad faith; (2) the opposing party's ability to satisfy an award of attorney's fees; (3) the deterrent effect of an award on other persons under similar circumstances; (4) whether the party requesting fees sought to confer a common benefit on all participants and beneficiaries of an ERISA plan or resolve significant legal questions regarding ERISA; and (5) the relative merits of the parties' positions.King, 775 F.2d at 669. The Court of Appeals for the Sixth Circuit has held that if no single factor or combination of factors "weighs heavily" in favor of awarding attorney's fees, denial of fees is not an abuse of discretion. Schwartz v. Gregori, 160 F.3d 1116, 1121 (6th Cir. 1998) (denying plaintiff's appellate attorney's fees in ERISA action). In applying these factors to the case at bar, the Court finds that an award of attorney's fees and costs to the plaintiff is not warranted.
After reviewing the pre-litigation correspondence and discussions between the parties and their attorneys, the Court is persuaded that the defendant acted in good faith by ultimately retaining a competent attorney, and by weighing his options in light of that legal advice. Because the defendant had thoughtfully analyzed his legal position and clearly communicated his position to the plaintiff, the Court finds that the defendant did not act in bad faith. Therefore, the Court finds that the plaintiff is not entitled to its attorney's fees and costs. Armistead v. Vernitron Corp., 944 F.2d 1287 (6th Cir. 1991); Trustees for Michigan BAC Health Care Fund v. OCP Contractors, Inc., 136 Fed.Appx. 849, 853 (6th Cir. June 17, 2005). Accordingly,
Defendant's Motion to Dismiss (Doc. 6) is GRANTED. Absent a stipulation of the parties to a dismissal of the case, the plaintiff shall show cause by filing a memorandum on or beforeApril 11, 2006, containing its legal analysis (in a non-conclusory fashion) why the remainder of the complaint should not be dismissed.
IT IS SO ORDERED.