Opinion
Civil Action No: 03-759, Section: "R"(5).
October 28, 2004
ORDER AND REASONS
The defendant, Hartford Life and Accident Insurance Company, moves the Court to sanction the plaintiff, Gilbert Goldman, for making claims without a factual or legal basis. For the following reasons, the Court DENIES Hartford's motion.
I. BACKGROUND
Gilbert Goldman is a 56 year-old former employee of Baroid, a division of Halliburton. On March 23, 2001, Goldman injured his head, arm and neck at work. Goldman underwent a cervical fusion and did not return to work after his accident. In March of 2003, Goldman applied for long-term disability benefits under the Halliburton long-term disability insurance plan. Hartford Life and Accident Insurance Company is the claims administrator and insurer of the plan. Hartford denied Goldman's application for long-term disability benefits. On February 3, 2003, Goldman sued Hartford in state court. Hartford removed the action to this Court and moved the Court to sanction Goldman for requesting relief that is not available to claimants under ERISA, for making factual assertions that Hartford provided Goldman with medical, health, dental, and vision care benefits, and for making claims unsupported by law.
II. DISCUSSION
A. Legal Standard
The Court may impose appropriate sanctions, including attorneys' fees and costs, on an attorney who files a pleading in violation of Federal Rule of Civil Procedure 11. See Mercury Air Group, Inc. v. Mansour, 237 F.3d 542, 548 (5th Cir. 2001). Rule 11 provides that when an attorney submits a pleading to the court, he certifies to the best of his knowledge, information, and belief that (1) the pleading is not interposed for any improper purpose, such as harassment, unnecessary delay, or increased costs of litigation; (2) the pleading is warranted by existing law or a good faith argument for modification or reversal of existing law; and (3) the allegations and other factual contentions have evidentiary support, or if specifically so identified, are likely to have evidentiary support after a reasonable opportunity for further investigation or discovery. Fed.R.Civ.P. 11(b); Childs v. State Farm Mutual Ins. Co., 29 F.3d 1018, 1023 (5th Cir. 1994); American Airlines, Inc. v. Allied Pilots Ass'n, 968 F.2d 523, 529 (5th Cir. 1992). This means that an attorney must make a reasonable inquiry into the facts and the law underlying a paper he or she submits to the court. Mercury Air, 237 F.3d at 548. When a reasonable amount of research would have revealed that a party's position is groundless, Rule 11 sanctions are appropriate. Jordaan v. Hall, 275 F.Supp.2d 778, 787 (N.D. Tx. 2003).
A party who seeks Rule 11 sanctions must notify the offending party 21 days before presenting the motion to the court to provide the offending party with an opportunity to withdraw the claim or correct its defects. FED. R. CIV. P. 11 (c) (a). Failure to comply with the twenty-one day rule is an adequate ground on which to deny a motion for sanctions. See Tompkins v. Cyr, 202 F.3d 770, 788 (5th Cir. 2000). Hartford has provided the Court with evidence that it complied with the 21-day safe harbor provision.
B. Analysis
(1) Requested Relief and Factual Assertions
Hartford moves the Court to sanction Goldman for, inter alia, requesting relief that is not available to claimants under ERISA. At the time, Goldman believed he had a viable cause of action under state law for claims that could have entitled him to remedies that are not available to claimants under ERISA. ( See II.B. (2), infra.) Moreover, on January 29, 2004 Goldman informed Hartford that he was aware that he had no claim for punitive damages under ERISA. ( See Def.'s Ex. 2.) Goldman reaffirmed this several times in correspondence with Hartford. ( See Def.'s Ex. 4, 8, 9, 11.) On July 13, 2004, Goldman amended his complaint to delete his demand for $5,000,000.00 in damages and punitive damages. Goldman did not specifically delete his request for penalties, but he noted that he was aware that the only relief to which he is entitled under ERISA includes long-term disability benefits plus pre-judgment interest and reasonable attorney's fees. Penalties are not available to claimants under ERISA. Therefore, Hartford's motion is denied as to Goldman's demands for relief.
Hartford also moves the Court to sanction Goldman for alleging that Hartford provided Goldman with medical, dental, health, and vision care benefits. It appears that Goldman added claims for medical, dental, health, and vison care benefits after receiving documents from Hartford referring to these types of insurance. ( See Pl.'s Mot. Opp'n Sanctions at 7-8, Ex. 4.) Although Hartford did not provide Goldman with insurance coverage other than long-term disability, the Court finds that Goldman relied, albeit misguidedly, on documentary evidence in making his allegations. Moreover, Goldman amended his complaint on July 13, 2004 to delete any claims for medical, dental, health, and vision care benefits. Therefore, Goldman's factual allegations do not amount to sanctionable conduct and Hartford's motion is denied as to the factual allegations.
(2) State Law Claims
Hartford argues the Court should sanction Goldman for pleading state law causes of action that are pre-empted by ERISA. Goldman's best argument is that when he filed his state law claims, the issue of the scope of ERISA preemption was before the Supreme Court because the Supreme Court had granted certiorari on a Fifth Circuit ERISA preemption case. See Roark v. Humana, Inc., 307 F.3d 298 (5th Cir. 2002), rev'd sub nom. Aetna Health Inc. v. Davila, 124 S.Ct. 2488 (2004). Although the issues there ultimately had no bearing on Goldman's claims, given the complexity of ERISA law, the Court does not find Goldman's assertion of state law claims in this context to be sanctionable under Rule 11. See Fed.R.Civ.P. 11(b) (providing that when a lawyer signs a pleading, he certifies that the pleading is warranted by existing law or a good faith argument for modification or reversal of existing law). Compare Spiller v. Ella Smithers Geriatric Center, 919 F.2d 339, 346 (5th Cir. 1990) (noting that a conclusory allegation contrary to current jurisprudence and unsupported by any legal citation does not constitute a good faith argument for the modification of existing law), with Smith Intern. v. Texas Commerce Bank, 844 F.2d 1193, 1199-1200 (5th Cir. 1988) (declining to find that an erroneous legal theory necessarily warranted sanctions).
(3) Request for Jury Trial
Hartford also moves the Court to sanction Goldman for requesting a trial by jury. Relevant Fifth Circuit law holds that a trial by jury is not appropriate under ERISA. See Calamia v. Spivey, 632 F.2d 1235, 1237 (5th Cir. 1980). Goldman, however, provided some legal support for his jury demand, citing Hulcher v. United Behavioral Systems, 919 F.Supp. 879 (E.D. Va. 1995) (declining to strike a plaintiff's demand for trial by jury, reasoning that actions for denial of benefits under ERISA are legal, not equitable, in nature). Goldman's request for a jury trial constitutes an insufficient basis on which to impose sanctions.
III. CONCLUSION
For the above reasons, the Court DENIES Hartford's motion for sanctions.