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7th Circuit upholds denial of class action, statutory damages

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Note: This story has been edited to reflect a change by the 7th Circuit Court of Appeals Sept. 22, 2011.

In an appeal of the denial of a proposed class-action lawsuit based on the finding the attorney was inadequate to represent the class, the 7th Circuit Court of Appeals noted that the attorney’s demeanor on appeal didn’t help his cause.

In Blanca Gomez and Joan Wagner-Barnett v. St. Vincent Health Inc., No. 10-2379, Blanca Gomez and Joan Wagner-Barnett, former employees of St. Vincent Health, appealed the District Court’s decision to not certify the proposed class, the denial of the plaintiffs’ requests for statutory penalties, and the amount of damages awarded to Barnett in their suit alleging St. Vincent violated the notice provisions regarding how the two could extend their health insurance coverage within the period prescribed by statute.

Before this case was filed, the District Court dismissed a similar suit, Brown-Pfifer v. St. Vincent Health Inc., No. 1:06-CV-236, 2007 WL 2757526 (S.D. Ind. Sept. 20, 2007), in which those who did not timely receive their COBRA notices sued St. Vincent. During May 2004 and January 2006, nearly 266 of the 1,570 people who received health benefits from St. Vincent and experienced qualifying events didn’t receive timely COBRA notices. The same attorney in Brown-Pfifer, Ronald Weldy, was the attorney in the instant case.

Instead of appealing the dismissal of Brown-Pfifer, the case was re-filed with two new named plaintiffs, Gomez and Barnett. U.S. Judge Sarah Evans Barker found the proposed class counsel would inadequately represent the proposed class, and denied class certification. Ruling on the plaintiffs’ individual claims, the judge awarded no damages to Gomez, as she had testified that she wouldn’t have purchased the COBRA coverage even if she had received the notice on time. Judge Barker awarded Barnett, who testified she would have purchased the coverage and had medical expenses after her employment ended with St. Vincent, $396 in damages. Judge Barker also declined to impose statutory penalties against St. Vincent.

The 7th Circuit Court of Appeals affirmed the lower court in all respects, even though it had some reservations about the District Court’s determination that “such other relief” that may be awarded under the COBRA notification enforcement provision could include an award of medical expenses incurred as a result of the COBRA notification violation, minus deductibles and premiums the beneficiary would have paid to get coverage under COBRA.

“While we are reticent to condone without limitation this method of compensation in COBRA-notification violation cases, we find no error in this particular case. The district court awarded the monetary damages pursuant to subsection 1132(c)(1)’s ‘such other relief’ provision, and the award does not contradict the section’s plain text,” wrote Judge Michael Kanne.

They also affirmed the decision to not impose statutory penalties against St. Vincent, noting the case lacks any evidence of an administrator’s bad faith or gross negligence.

Finally, the judges affirmed the decision that the plaintiffs’ counsel wasn’t an adequate representative of the class. Judge Barker found that Weldy’s actions during his attempts to represent the proposed classes in both suits didn’t make him an adequate class counsel. In Brown-Pfifer, another judge found, among other things, that Weldy wasn’t diligent in prosecuting his proposed class action. In the instant case, he had been ordered to pay expenses in conjunction with St. Vincent’s motion to compel.

The judges found Weldy’s arguments on appeal to be unpersuasive.

“If counsel wished to convince us that the district court abused its discretion by finding him inadequate to represent the proposed class, his demeanor on appeal has not helped his cause. He has (perhaps mistakenly) misrepresented fundamental facts. And he has relied on hyperbole in the place of persuasive argument, failing to refute the district court’s reasoning,” wrote Judge Kanne.
 

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  1. Just an aside, but regardless of the outcome, I 'm proud of Judge William Hughes. He was the original magistrate on the Home place issue. He ruled for Home Place, and was primaried by Brainard for it. Their tool Poindexter failed to unseat Hughes, who won support for his honesty and courage throughout the county, and he was reelected Judge of Hamilton County's Superior Court. You can still stand for something and survive. Thanks, Judge Hughes!

  2. CCHP's real accomplishment is the 2015 law signed by Gov Pence that basically outlaws any annexation that is forced where a 65% majority of landowners in the affected area disagree. Regardless of whether HP wins or loses, the citizens of Indiana will not have another fiasco like this. The law Gov Pence signed is a direct result of this malgovernance.

  3. I gave tempparry guardship to a friend of my granddaughter in 2012. I went to prison. I had custody. My daughter went to prison to. We are out. My daughter gave me custody but can get her back. She was not order to give me custody . but now we want granddaughter back from friend. She's 14 now. What rights do we have

  4. This sure is not what most who value good governance consider the Rule of Law to entail: "In a letter dated March 2, which Brizzi forwarded to IBJ, the commission dismissed the grievance “on grounds that there is not reasonable cause to believe that you are guilty of misconduct.”" Yet two month later reasonable cause does exist? (Or is the commission forging ahead, the need for reasonable belief be damned? -- A seeming violation of the Rules of Profession Ethics on the part of the commission) Could the rule of law theory cause one to believe that an explanation is in order? Could it be that Hoosier attorneys live under Imperial Law (which is also a t-word that rhymes with infamy) in which the Platonic guardians can do no wrong and never owe the plebeian class any explanation for their powerful actions. (Might makes it right?) Could this be a case of politics directing the commission, as celebrated IU Mauer Professor (the late) Patrick Baude warned was happening 20 years ago in his controversial (whisteblowing) ethics lecture on a quite similar topic: http://www.repository.law.indiana.edu/cgi/viewcontent.cgi?article=1498&context=ilj

  5. I have a case presently pending cert review before the SCOTUS that reveals just how Indiana regulates the bar. I have been denied licensure for life for holding the wrong views and questioning the grand inquisitors as to their duties as to state and federal constitutional due process. True story: https://www.scribd.com/doc/299040839/2016Petitionforcert-to-SCOTUS Shorter, Amici brief serving to frame issue as misuse of govt licensure: https://www.scribd.com/doc/312841269/Thomas-More-Society-Amicus-Brown-v-Ind-Bd-of-Law-Examiners

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