Opposition Brief — Guidry v. Sheet Metal Workers' National Pension Fund

No. 94-1300

IN OAS MY 660 ee Pee

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In The FEB 2 3 1995

Supreme Court of the Un ted States

V3 FICE OF THE CLE

October Term, 1994 a CLERK

CURTIS GUIDRY,

Petitioner,

SHEET METAL WORKERS’ NATIONAL PENSION

FUND; SHEET METAL WORKERS’ LOCAL UNIONS

AND COUNCILS PENSION PLAN; SHEET METAL

WORKERS’ INTERNATIONAL ASSOCIATION, LOCAL

9; SHEET METAL WORKERS’ LOCAL NO. 9

PENSION FUND, et al.,

Respondents.

4

Petition For Writ Of Certiorari

To The United States Court Of Appeals

For The Tenth Circuit

4

BRIEF OF RESPONDENT PENSION FUNDS

IN OPPOSITION TO PETITION

FOR WRIT OF CERTIORARI

.

STEPHEN T. JOHNSON

(Counsel of Record)

JoANN L. Vocrt

ROTHGERBER, APPEL, POWERS

& JOHNSON

One Tabor Center, Suite 3000

1200 17th Street

Denver, Colorado 80202-5839

(303) 623-9000

Counsel of Record for Respondents

Sheet Metal Workers’ National Pen-

sion Fund, Sheet Metal Workers’

Local Unions and Councils Pension

Plan, and Sheet Metal Workers’ Local

No. 9 Pension Fund

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964

OR CALL COLLECT (402) 342-2831

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TABLE OF CONTENTS

Page

SER GPE PUP IPRS 6c ces eenesdawessaepetas il

PRGRREERECE SW BEBE GPR: 6 56 6b ees hbase nn deus 1

ASEENERS CE PAIAAIINIEEN So bcs cco see ven ences noes 6

pd | rere ee Tee eer Tere TTT eee re eee 7

I. THERE ARE NO UNSETTLED PRINCIPLES

OF LAW, CONFLICTS AMONG THE CIR-

CUITS, OR OTHER “SPECIAL AND IMPOR-

TANT REASONS” FOR GRANTING

CERTIORARI REVIEW OF THE DENIAL OF

GUIDRY’S MOTION FOR ATTORNEYS’ FEES,

AN ISSUE WHICH IS OF SIGNIFICANCE

ONLY TO THE PARTIES AND WHICH IS

WHOLLY TANGENTIAL TO THE MAIN

Ere BOG. CEWURe Ste oad oh a cia dawns cow ea es 8

Il. THE DISTRICT COURT’S DENIAL OF ATTOR-

NEYS’ FEES IN THIS CASE WAS A PROPER

EXERCISE OF THE COURT’S DISCRETION,

AND WAS CONSISTENT WITH SETTLED

PRINCIPLES OF LAW APPLICABLE TO THIS

A. In Exercising their Discretion to Grant or

Deny Attorneys’ Fees in ERISA Cases,

Courts are to Consider Factors Such as the

Bad Faith of the Offending Parties, the

Potential Deterrent Effect of a Fee Award,

and the Merits of the Parties’ Positions.. 10

B. The District Court’s Denial of Attorneys’

Fees to Guidry was Appropriate Under the

Principles Outlined Above............... 13

ee el 8 | a re ne oe ee ere eer 16

TABLE OF AUTHORITIES

Page

CASES

Armistead v. Vernitron Corp., 944 F.2d 1287 (6th Cir.

PPP a kidd cdancininsnsiieseneee 31, 32, 35,

Braxton v. United States, 500 U.S. 344 (1991).......... 8

Consolidated Beef Industries, Inc. v. New York Life

Ins. Co., 949 F.2d 960 (8th Cir. 1991), cert. denied,

142 SS. CR. 1670 C0987) 6 oh ccc aes sede eee 10, 12

Custer v. Pan American Life Ins. Co., 12 F.3d 410 (4th

Cle. 9998) 6 cccsesdaesetanss ee 10, 12, 13

Davidson v. Canteen Corp., 957 F.2d 1404 (7th Cir.

SPP) cccecssevsvsuouvseausueeeeae a4, ia

Downie v. Independent Drivers Ass'n Pension Plan,

O65 F.2G 3171 (iG Cae. Tere ca ese eee 6, 10

Eaves v. Penn, 587 F.2d 453 (10th Cir. 1978)

Pee ePerrT rere rer Cry oe eee ae Rhy Be oe oe

Florence Nightingale Nursing Service, Inc. v. Blue

Cross/Blue Shield of Alabama, 41 F.3d 1476 (11th

CO FORO) io dncuwecdececansteeeeee 10, 11, 15

Freeman v. Continental Ins. Co., 996 F.2d 1116 (11th

Cis: 1990) . .2ks300iscers esse an, Ez, 33

Guidry v. Sheet Metal Workers’ National Pension

Fund, 641 F. Supp. 360 (D. Colo. 1986), aff'd, 856

F.2d 1457 (10th Cir. 1988), rev'd, 493 U.S. 365

(1990), appeal after remand, 10 F.3d 700 (10th Cir.

1993), on reh’g en banc, 39 F.3d 1078 (10th Cir.

DOOR), 6 cnccdectvneveceaseveseeeee i

Harms v. Cavenham Forest Industries, Inc., 984 F.2d 686

(5th Cir.), cert. denied, 114 S. Ct. 382 (1993)....... 12, 13

ill

TABLE OF AUTHORITIES - Continued

Page

Ironworkers Local No. 272 v. Bowen, 624 F.2d 1255

TL ok cay yir avs a4 p44 ane bo eos 11

Plumbers and Steamfitters Local No. 150 Pension

Fund v. Vertex Construction Co., 932 F.2d 1443

SS oe cee 11, 15

Quesinberry v. Life Ins. Co. of North America, 987

ee eg AR | a ea 1, hi,

Ramsey v. Colonial Life Ins. Co. of America, 12 F.3d

op Be Eee | | er 10, 11, 12, 13, 14

Rice v. Sioux City Memorial Park Cemetery, Inc., 349

re en ee Sere ee 8

Saltarelli v. Bob Baker Group Medical Trust, 35 F.3d

Ns iatadencekevensseds 10, 11

Tiemeyer v. Community Mut. Ins. Co., 8 F.3d 1094 (6th

Cir. 1993), cert. denied, 114 S. Ct. 1371 (1994) ..... 10, 12

STATUTES AND RULES

29 USC. & 1001 ef Seq. 0... ice cece cece cc nneees 2

MON os oy saci v ne deieves ee ceceus 4

RS Rs eee 1, 6, 10

U.S. Sup. Ct. Rule 10.1 ........... eee eee eee eee eee ee, 8

U.S. Sup. Ct. Rule 15............- see e reece eee eeeeee: 1

U.S. Sup. Ct. Rule 24(1)(a), aE SS |) eres 1

i

Respondents Sheet Metal Workers’ National Pension

Fund, Sheet Metal Workers’ Local Unions and Councils

Pension Plan, and Sheet Metal Workers’ Local No. 9 Pen-

sion Fund (hereinafter collectively “Pension Funds”), by

their undersigned counsel and pursuant to U.S. Sup. Ct.

Rule 15, submit the following brief in opposition to the

Petition for Writ of Certiorari filed by Curtis Guidry. For

the reasons set forth below, this brief addresses only the

third of Guidry’s four questions presented for review,

namely:

Should Guidry be awarded his reasonable attor-

neys’ fees under ERISA, 29 U.S.C. § 1132(g), for

fees arising after this Court’s 1990 decision?

The Pension Funds accept Guidry’s statement of the

preliminary matters required by USS. Sup. Ct. Rule

24(1)(a), (b), (d), (e), and (f).

‘

STATEMENT OF THE CASE

Prior to 1981, Guidry was the chief executive officer

of Respondent Sheet Metal Workers’ International Asso-

ciation, Local 9 (hereinafter the “Union”), and a trustee of

Respondent Sheet Metal Workers’ Local No. 9 Pension

Fund.’ In 1982, Guidry pleaded guilty to embezzling

more than $377,000 from the Union. Before serving his

prison term for embezzlement, Guidry claimed benefits

' For a complete background, see Guidry v. Sheet Metal

Workers’ National Pension Fund, 641 F. Supp. 360 (D. Colo. 1986),

aff'd, 856 F.2d 1457 (10th Cir. 1988), rev'd, 493 U.S. 365 (1990),

appeal after remand, 10 F.3d 700 (10th Cir. 1993), on reh’g en banc,

39 F.3d 1078 (10th Cir. 1994).

from the three Pension Funds. After the Pension Funds

denied Guidry’s claims for benefits on the grounds thai

he had forfeited the right to his pensions because of

criminal misconduct against the Union, Guidry filed suit

in the U.S. District Court for the District of Colorado

pursuant to the Employee Retirement Income Security

Act of 1974, 29 U.S.C. § 1001 et seq. (“ERISA”).

The Union intervened in the litigation and filed

claims against Guidry for recovery of the embezzled

funds. In the course of the litigation, Guidry and the

Union stipulated to the entry of a $275,000 judgment in

the Union’s favor and against Guidry. They agreed to

litigate the availability of the constructive trust remedy

requested by the Union.

The district court rejected the Pension Funds’ claim

that Guidry had forfeited his right to benefits; however, it

concluded that ERISA did not preclude the imposition of

a constructive trust over those funds in favor of the

Union. 641 F. Supp. at 363. The district court judgment

was affirmed by the U.S. Court of Appeals for the Tenth

Circuit. 856 F.2d 1457 (10th Cir. 1988). This Court

reversed, 493 U.S. 365 (1990), holding that ERISA’s pre-

clusion against the alienation of pension benefits pre-

cluded placing a constructive trust on Guidry’s pension

benefits. 493 U.S. at 375-76.

After this Court’s decision, Guidry moved for reim-

bursement of his attorneys’ fees expended in the litiga-

tion. The district court denied that request as to both the

Union and the Pension Funds. It held that the litigation

between Guidry and the Union did not arise under

ERISA, so that the Union could not be subjected to

ERISA’s provision regarding attorneys’ fees. As to both

the Union and the Pension Funds, the court ruled that

Guidry was not entitled to an award of fees under the

guidelines for recovery of fees in ERISA cases set forth in

Eaves v. Penn, 587 F.2d 453 (10th Cir. 1978). Guidry did not

appeal the district court’s denial of fees.

In accordance with this Court’s remand, on February

28, 1991, the district court entered judgment ordering the

Pension Funds to pay past and future pension benefits to

Guidry. At the same time, the Union made efforts to

satisfy its $275,000 judgment against Guidry from those

pension payments. The Union registered its judgment

against Guidry in the U.S. District Court in Houston,

Texas, where Guidry resided. When the Pension Funds

tendered some $190,000 to Guidry at his home in Texas,

in satisfaction of the award of back pension benefits, the

funds were immediately seized by a U.S. Marshal and

deposited into the registry of the Texas court. See Guidry

Appendix, A-74. The Union also made efforts to collect its

judgment through garnishments on a Denver bank

account established by Guidry, into which the Pension

Funds were to deposit his future monthly pension

amounts as they became due.

These activities gave rise to post-judgment proceed-

ings in the U.S. District Courts in Colorado and in the

Southern District of Texas. On August 23, 1991, the par-

ties stipulated that the money in the court registry in

Texas would be transferred to the Denver bank account

which was the subject of the Union’s garnishment efforts,

and that past and future pension payments would be

deposited into that account and be subject to the Union's

initial garnishment. Guidry Appendix, A-76 to A-80.

On January 8, 1992, the district court in Colorado

entered its Findings, Conclusions and Order on Post-

Judgment Issues (Guidry Appendix, A-66 to A-71). The

court concluded that the ERISA exemption from garnish-

ment, 29 U.S.C. § 1056(d)(1), applied to the payments

made by the Pension Funds into the Guidry account, and

noted that its conclusion was “mandated by the law of

this case” as announced by this Court in its 1990 decision.

Guidry Appendix, A-69. It further concluded that the

Pension Funds’ attempt to satisfy the judgment against

them by the tender made in Texas was not legally effec-

tive; that the Pension Funds and the Union had not

violated any order of the court and had not acted in

contempt of court; and that neither the Texas exemption

statute nor the Colorado exemption statute applied to the

case.

The district court also denied Guidry’s motion for

recovery of his attorneys’ fees and costs incurred subse-

quent to the district court’s February 28, 1991, judgment

in his favor. Guidry had argued that an award of fees was

now appropriate even though the court had previously

denied such an award, because the Union and the Pen-

sion Funds had shown “an obstinate and unbending atti-

tude” toward this Court’s decision and had conspired to

continue to deprive him of his pensions. The district

court rejected the argument, noting that the post-judg-

ment dispute went beyond the initial action to recover

plan benefits, and involved “both the plaintiff’s claim of

exemption under ERISA and the Union’s efforts to collect

on its judgment.” Guidry Appendix, A-70. The court con-

cluded that the attempted tender and seizure of funds in

Texas was not forum shopping or misconduct by the

parties or by counsel, but instead constituted “diligent

efforts” to avoid injustice. Although it had ruled those

efforts invalid, the court declined to “add to the inequity

by awarding attorney’s fees.” Id.

A three-member panel of the U.S. Court of Appeals

for the Tenth Circuit, with one dissent, reversed the dis-

trict court on the garnishment issue, concluding that the

ERISA anti-alienation provision did not protect funds

paid to and received by Guidry. 10 F.3d at 710. It also held

that exemptions from garnishment provided by Colorado

law were preempted by ERISA. Id. at 713. As to Guidry’s

cross-appeal of the district court’s denial of his motion

for attorneys’ fees, the panel noted simply that “[b]ecause

he is not the prevailing party, this issue is moot.” Id. at

716.

Upon rehearing en banc, the Tenth Circuit agreed

with the panel that ERISA’s anti-alienation provision did

not apply to protect Guidry’s pension funds from gar-

nishment once they were paid to and received by him. 39

F.3d at 1083. However, it reversed the panel on the issue

of ERISA’s preemption of state garnishment laws, and

held that the funds were exempt from garnishment to the

extent provided by Colorado law - i.e., 75 percent. Id. at

1083-84. The Tenth Circuit’s decision on the attorneys’

fees issue is set forth in a single footnote at the end of the

majority opinion:

In his original appeal, Mr. Guidry claimed that

the district court abused its discretion in deny-

ing his request for attorneys fees. On rehearing,

Mr. Guidry made specific arguments and also

requested a rehearing on all other issues within

the panel opinion, although he did not speci-

fically reassert his earlier argument on the fee

issue. Assuming that the issue is properly before

the en banc court, we find no grounds for

reversing the district court’s ruling that Mr. Gui-

dry was not entitled to a fee award under the

ERISA fee-shifting provision, 29 U.S.C.

§ 1132(g). See Downie v. Independent Drivers Ass'n

Pension Plan, 945 F.2d 1171, 1172 (10th Cir. 1991)

(district court decision on a fee award under

section 1132(g) reviewed for abuse of discre-

tion).

Id. at 1087, n.11.

SUMMARY OF ARGUMENT

Regardless of this Court’s decision on the other

issues raised in Guidry’s Petition for Writ of Certiorari,

the Court should deny certiorari on Guidry’s third ques-

tion presented for review (relating to the denial of his

motion for attorneys’ fees), the only issue which still

involves the Pension Funds.

The attorneys’ fees issue is entirely tangential to the

main questions raised in this case, and was barely

touched upon by the courts below. It is an issue of iso-

lated significance, not of public importance. The issue

does not involve any conflict among the circuits or unset-

tled question of law that needs to be resolved by this

Court.

The law regarding attorneys’ fee awards in ERISA

cases is well settled, and was properly applied by the

lower courts in this case. ERISA commits the decision on

attorneys’ fees to the sound discretion of the district

court. The cases have identified factors which are to

guide courts in the exercise of this discretion. Application

of those factors in this case supports the district court’s

denial of fees.

As the district court found, the parties against whom

fees were sought in this case did not act in bad faith, and

had a legitimate legal basis for their position. The unique

circumstances of this case significantly lessen any poten-

tial deterrent effect from an attorneys’ fees award, and

likewise lessen the amount of “benefit,” if any, to other

plan participants from the decision in Guidry’s favor.

Moreover, it was not improper for the district court to

take Guidry’s criminal conduct into account in denying

his motion for fees.

Because there are no “special and important reasons”

for granting review of this issue, and because the district

court’s exercise of its discretion in denying fees was

consistent with settled principles of law applicable to the

issue, certiorari should be denied.

*

ARGUMENT

Although the Union and Guidry have continued to

litigate the legality of garnishment of pension funds sub-

sequent to this Court’s first opinion, the Pension Funds

effectively withdrew from the litigation upon the parties’

August 23, 1991, stipulation providing that all monies

owed by the Pension Funds to Guidry would be paid into

Guidry’s Denver bank account. Guidry Appendix, A-76

to A-80. The Pension Funds’ involvement in the case

since then has been limited to opposition to Guidry’s

request for attorneys’ fees, which were sought both from

the Pension Funds and from the Union. In this brief, the

Pension Funds address only the attorneys’ fees issue

(question three in Guidry’s Petition), and take no position

on the other questions presented for review.

As to attorneys’ fees, the Pension Funds believe that

certiorari review of this issue should be denied regardless

of this Court’s determination of the other issues raised in

Guidry’s petition.

I. THERE ARE NO UNSETTLED PRINCIPLES OF

LAW, CONFLICTS AMONG THE CIRCUITS, OR

OTHER “SPECIAL AND IMPORTANT REASONS”

FOR GRANTING CERTIORARI REVIEW OF THE

DENIAL OF GUIDRY’S MOTION FOR ATTOR-

NEYS’ FEES, AN ISSUE WHICH IS OF SIGNIFI-

CANCE ONLY TO THE PARTIES AND WHICH IS

WHOLLY TANGENTIAL TO THE MAIN ISSUES IN

THIS CASE.

A petition for a writ of certiorari will be granted only

when there are “special and important reasons therefor.”

U.S. Sup. Ct. Rule 10.1. Such reasons may include, for

example, resolution of a conflict among the circuit courts

of appeals or state courts of last resort concerning the

meaning of a provision of federal law. Braxton v. United

States, 500 U.S. 344, 347 (1991). This Court has stated in

the past that certiorari review is not appropriate on issues

which are of “isolated significance” and not of public

importance. Rice v. Sioux City Memorial Park Cemetery, Inc.,

349 U.S. 70, 76-77 (1955).

Under these standards, certiorari should be denied

on Guidry’s attorneys’ fees issue. This issue is wholly

tangential to the main issues in this case, and was barely

touched upon by the courts below. Whatever “nationwide

significance” the other issues in Guidry’s Petition may

have, the attorneys’ fee issue has no such significance.

Neither Guidry nor any of the lower courts has identified

any dispute over the tests or other legal principles appli-

cable to a determination of this issue, or any conflict

among the circuits that needs to be resolved by this

Court. Moreover, including the attorneys’ fees issue in

any grant of certiorari in this case would involve parties

(the Pension Funds) whose liability, except for attorneys’

fees, has been long since resolved, and who are otherwise

not directly affected by whatever decision is reached on

the remaining issues.

II. THE DISTRICT COURT’S DENIAL OF ATTOR-

NEYS’ FEES IN THIS CASE WAS A PROPER

EXERCISE OF THE COURT’S DISCRETION, AND

WAS CONSISTENT WITH SETTLED PRINCIPLES

OF LAW APPLICABLE TO THIS ISSUE.

Certiorari should be denied because the attorneys’

fees issue was properly resolved by the courts below.

ERISA by its terms commits the decision whether to

award attorneys’ fees to the sound discretion of the dis-

trict court. The district court’s decision to deny fees in

this case was a proper exercise of that discretion, and is

consistent with conclusions reached by other courts

applying well-established tests for deciding whether to

award fees. The Tenth Circuit properly limited its review

to determining whether there were grounds for finding

10

an abuse of discretion. There is no basis for further

review of the issue by this Court.

A. In Exercising their Discretion to Grant or Deny

Attorneys’ Fees in ERISA Cases, Courts are to

Consider Factors Such as the Bad Faith of the

Offending Parties, the Potential Deterrent

Effect of a Fee Award, and the Merits of the

Parties’ Positions.

The award of attorneys’ fees in this case is governed

by ERISA § 502(g)(1) (29 U.S.C. § 1132(g)(1)), which pro-

vides in pertinent part:

In any action under this subchapter .. . by a

participant, beneficiary, or fiduciary, the court in

its discretion may allow a reasonable attorney’s

fee and costs of action to either party.

Consistent with the language of the statute, the courts

have recognized that an award of attorneys’ fees in

ERISA cases is committed to the sound discretion of the

district court, and is reviewable on appeal only for abuse

of discretion. E.g., Custer v. Pan American Life Ins. Co., 12

F.3d 410, 422 (4th Cir. 1993); Ramsey v. Colonial Life Ins. Co.

of America, 12 F.3d 472, 480 (5th Cir. 1994); Tiemeyer v.

Community Mut. Ins. Co., 8 F.3d 1094, 1102 (6th Cir. 1993),

cert. denied, 114 S. Ct. 1371 (1994); Consolidated Beef Indus-

tries, Inc. v. New York Life Ins. Co., 949 F.2d 960, 966 (8th

Cir. 1991), cert. denied, 112 S. Ct. 1670 (1992); Downie v.

Independent Drivers Ass'n Pension Plan, 945 F.2d 1171, 1172

(10th Cir. 1991); Florence Nightingale Nursing Service, Inc.

v. Blue Cross/Blue Shield of Alabama, 41 F.3d 1476, 1485

(11th Cir. 1995).

11

Unlike the mandatory-fee shifting provisions of some

statutes, a fee award is not required in ERISA cases even

when one party prevails on the merits. Quesinberry v. Life

Ins. Co. of North America, 987 F.2d 1017, 1030 (4th Cir.

1993); Saltarelli v. Bob Baker Group Medical Trust, 35 F.3d

382, 387 (9th Cir. 1994); Freeman v. Continental Ins. Co., 996

F.2d 1116, 1119 (11th Cir. 1993).

In assessing whether to award fees, many courts have

adopted the five-factor test first announced by the Tenth

Circuit in Eaves v. Penn, 587 F.2d 453 (10th Cir. 1978). That

test directs the courts to consider:

(1) The degree of the offending parties’ cul-

pability or bad faith;

(2) The degree of the ability of the offending

parties to personally satisfy an award of

attorneys’ fees;

(3) Whether or not an award of attorneys fees

against the offending parties would deter

other persons acting under similar circum-

stances;

(4) The amount of benefit conferred on mem-

bers of the pension plan as a whole; and

(5) The relative merits of the parties’ position.

Id. at 465. See also Quesinberry, 987 F.2d at 1029; Ramsey, 12

F.3d at 480; Armistead v. Vernitron Corp., 944 F.2d 1287,

1303 (6th Cir. 1991); Saltarelli, 35 F.3d at 388; Florence

Nightingale, 41 F.3d at 1485. No one factor is decisive, and

the courts may consider other factors in addition to the

five enumerated here. Plumbers and Steamfitters Local No.

150 Pension Fund v. Vertex Construction Co., 932 F.2d 1443,

1453 (11th Cir. 1991) (citing Ironworkers Local No. 272 v.

12

Bowen, 624 F.2d 1255, 1266 (5th Cir. 1980), for the proposi-

tion that “[n]o one of these factors is necessarily decisive,

and some may not be apropos in a given case, but

together they are the nuclei of concerns that a court

should address. .. . In particular types of cases, or in any

individual case, however, other considerations may be

relevant as well”); Quesinberry, 987 F.2d at 1029; Armi-

stead, 944 F.2d at 1304.

Attorneys’ fees may be denied under this test even if

one or more factors would support an award of fees. See

Ramsey, 12 F.3d at 480 (no abuse of discretion in denying

fees, even though defendant could afford to pay the

attorneys’ fee award); Tiemeyer, 8 F.3d at 1102 (same);

Davidson v. Canteen Corp., 957 F.2d 1404, 1409 (7th Cir.

1992) (denial of fees to plaintiffs not an abuse of discre-

tion even though factors two and three of five-factor test

weighed in plaintiffs’ favor).

As to the first of the five Eaves factors, courts have

been particularly willing to uphold denials of attorneys’

fees where there has been no illegal or bad faith conduct

on the part of the party against whom fees were sought.

See Custer, 12 F.3d at 423; Ramsey, 12 F.3d at 480; Harms v.

Cavenham Forest Industries, Inc., 984 F.2d 686, 694 (5th

Cir.), cert. denied, 114 S. Ct. 382 (1993); Davidson, 957 F.2d

at 1410; Freeman, 996 F.2d at 1120. Similarly, denial of fees

is appropriate where there was a legitimate legal basis for

the position taken by the party against whom the fees

were sought (Eaves factor five). Custer, 12 F.3d at 423;

Ramsey, 12 F.3d at 480; Harms, 984 F.2d at 694; Tiemeyer, 8

F.3d at 1102; Consolidated Beef Industries, 949 F.2d at 966

(8th Cir. 1991) (CBE’s claims were “serious and involved

complicated legal issues that were sufficiently debatable

—V3—V—nar

13

to justify plaintiff’s pursuit of the claims”); Freeman, 996

F.2d at 1120.

In applying the other factors, courts have upheld

denials of fees where the fee award would be unlikely to

deter others (factor three), and where the successful party

did not vindicate the rights of any other plan participants

or benefit other persons (factor four). See Custer, 12 F.3d

at 423; Harms, 984 F.2d at 694; Davidson, 957 F.2d at 1410;

Freeman, 996 F.2d at 1120. Deterrent effect and benefit to

others are often found to be lacking in cases involving

unique circumstances. In Ramsey, for example, the appel-

late court upheld the district court’s finding that the

“uniqueness of the circumstances greatly diminished the

deterrent effect of the ruling” and that “Ramsey’s suit

had no applicability to other ERISA participants.” 12 F.3d

at 480.

B. The District Court’s Denial of Attorneys’ Fees

to Guidry was Appropriate Under the Prin-

ciples Outlined Above.

The district court’s denial of attorneys’ fees to Guidry

in this case was a proper exercise of its discretion, and

was entirely consistent with the general principles set

forth above. The mere fact that this Court had previously

ruled that the Pension Funds were required to pay Gui-

dry’s pension did not make the parties’ subsequent

attempts to satisfy the Union’s judgment out of those

funds into misconduct or bad faith — as the district court

recognized. Guidry Appendix, A-70. Moreover, as the

district court stated in its Memorandum Opinion and

14

Order denying Guidry’s previous motion for fees,? an

award of attorneys’ fees to Guidry would not deter simi-

lar conduct by similar defendants in the future, given the

uniqueness of the case and the small likelihood that the

precise issue would arise in the future. See Ramsey, 12

F.3d at 480. Similarly, although Guidry’s ultimate victory

on the constructive trust issue might have conferred a

theoretical benefit on other embezzlers or similarly situ-

ated plan participants, that limited benefit should not

outweigh factors counseling strongly against an award of

fees under the unusual facts of this case.

As to the “relative merits of the parties’ positions,” it

should be remembered that the dispute between Guidry

and the Pension Funds (as distinguished from the dispute

between Guidry and the Union) was over the efficacy of

2 In its (unpublished) Memorandum Opinion and Order of

December 31, 1990, the district court undertook a detailed anal-

ysis of the merits of Guidry’s first attorneys’ fee claim under the

Eaves five-factor test. It found that the parties against whom fees

were sought had not acted in bad faith, and that their arguments

had been persuasive to the district court and to the court of

appeals even though Guidry ultimately prevailed in this Court.

It further found that the ability of the defendants to satisfy the

judgment need not be addressed because the other factors sup-

ported a denial of a fee award; that awarding fees to Guidry

would not deter similar conduct from similar defendants in the

future under the unique circumstances of the case; that any

benefits to other parties from Guidry’s victory were insignifi-

cant under the unusual facts of the case; and that although

Guidry ultimately prevailed on the merits, the defendants’ posi-

tion was reasonable and responsible. The court also stated that,

while it was not to adopt a punitive attitude against Guidry, his

criminal conduct was an appropriate factor to consider in deter-

mining whether to award fees.

15

the Pension Funds’ tender of benefits in Texas. Although

that tender was found later to have been ineffective, no

court found it to have been illegal or otherwise so lacking

in merit as to be punishable by an attorneys’ fee award.

Moreover, following that attempted tender, the Pension

Funds complied with Guidry’s request to transfer the

moneys at issue to his Colorado bank account; and they

did so pursuant to an August 1991 stipulation, long

before the district court ruled on the issue.

Finally, as noted above, courts may properly consider

other factors as well as the five enumerated Eaves factors

in deciding whether to award fees. The district court

appears to have taken into account Guidry’s criminal

conduct in deciding that the equities did not support an

award of fees. Guidry Appendix, A-70. Contrary to Gui-

dry’s argument to this Court, it was not inappropriate for

the district court to have done so. See Plumbers and Steam-

fitters Local No. 150 Pension Fund, 932 F.2d at 1453.

All these factors, taken together, amply support the

district court’s decision to deny fees to Guidry. Although

the district court did not articulate all five of the Eaves

factors in its second attorneys’ fees ruling (as it had done

in the first), that fact does not somehow require reversal

of its determination. See Florence Nightingale, 41 F.3d at

1485 (upholding district court’s denial of fees even

though court focused only on one factor, the degree of the

offending party’s bad faith); Plumbers and Steamfitters

Local No. 150 Pension Fund, 932 F.2d at 1453 (no abuse of

discretion, even though district court considered only

first and fifth factors of Eaves test); Armistead, 944 F.2d at

1304 (no remand necessary to require court to consider

factors two through five of test, where such consideration

16

would not lead to a different result). The fact that the

district court had gone through the five-factor Eaves anal-

ysis in detail when it denied Guidry’s initial motion for

fees (see n. 2, above) demonstrates that the court was

familiar with the test. As in Armistead, nothing would be

served by remanding this issue to the district court for a

renewed articulation of the Eaves test, when such articula-

tion would clearly not lead to a different result.

In his Petition, Guidry argues in regard to the attor-

neys’ fee issue that “since the congressional purpose is

that actual pension benefits be received, Guidry should

be awarded his statutory reasonable attorney fees under

ERISA ...” (Petition, p. 13). This argument is illogical. It

is undisputed that, in accordance with this Court’s pre-

vious opinion, Guidry is receiving his pension benefits. It

does not follow that anyone receiving pension benefits is

also entitled to an award of attorneys’ fees under ERISA.

Congress could have included such a provision in ERISA,

but it did not. Instead, the statute simply leaves the

award of fees to the discretion of the court.

The district court’s exercise of its discretion was

appropriate under the unique circumstances of this case,

and should not be disturbed by this Court.

+

CONCLUSION

There are no “special and important reasons” for

granting certiorari review of the denial of Guidry’s

request for attorneys’ fees. The district court’s ruling on

fees was entirely consistent with well-established princi-

ples of law applicable to this issue. The Pension Funds

|

17

accordingly respectfully request that, regardless of this

Court’s resolution of the remaining issues, it deny Gui-

dry’s Petition to the extent that it seeks review of the

district court’s denial of his motion for attorneys’ fees.

Respectfully submitted this 28th day of February,

1995.

STEPHEN T. JOHNSON

(Counsel of Record)

JOANN L. Voct

ROTHGERBER, APPEL,

Powers & JOHNSON

One Tabor Center, Suite 3000

1200 17th Street

Denver, Colorado 80202-5839

(303) 623-9000

Counsel of Record for Respondents

Sheet Metal Workers’ National Pen-

sion Fund, Sheet Metal Workers’

Local Unions and Councils Pension

Plan, and Sheet Metal Workers’ Local

No. 9 Pension Fund