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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. Welcome to Hendricks County where local and state statutes (especially Indiana Class C misdemeanors) are given a higher consideration than Federal statues and active duty military call-ups.

  2. If real money was spent on this study, what a shame. And if some air-head professor tries to use this to advance a career, pity the poor student. I am approaching a time that i (and others around me) should be vigilant. I don't think I'm anywhere near there yet, but seeing the subject I was looking forward to something I might use to look for some benchmarks. When finally finding my way to the hidden questionnaire all I could say to myself was...what a joke. Those are open and obvious signs of any impaired lawyer (or non-lawyer, for that matter), And if one needs a checklist to discern those tell-tale signs of impairment at any age, one shouldn't be practicing law. Another reason I don't regret dropping my ABA membership some number of years ago.

  3. The case should have been spiked. Give the kid a break. He can serve and maybe die for Uncle Sam and can't have a drink? Wow. And they won't even let him defend himself. What a gross lack of prosecutorial oversight and judgment. WOW

  4. I work with some older lawyers in the 70s, 80s, and they are sharp as tacks compared to the foggy minded, undisciplined, inexperienced, listless & aimless "youths" being churned out by the diploma mill law schools by the tens of thousands. A client is generally lucky to land a lawyer who has decided to stay in practice a long time. Young people shouldn't kid themselves. Experience is golden especially in something like law. When you start out as a new lawyer you are about as powerful as a babe in the cradle. Whereas the silver halo of age usually crowns someone who can strike like thunder.

  5. YES I WENT THROUGH THIS BEFORE IN A DIFFERENT SITUATION WITH MY YOUNGEST SON PEOPLE NEED TO LEAVE US ALONE WITH DCS IF WE ARE NOT HURTING OR NEGLECT OUR CHILDREN WHY ARE THEY EVEN CALLED OUT AND THE PEOPLE MAKING FALSE REPORTS NEED TO GO TO JAIL AND HAVE A CLASS D FELONY ON THERE RECORD TO SEE HOW IT FEELS. I WENT THREW ALOT WHEN HE WAS TAKEN WHAT ELSE DOES THESE SCHOOL WANT ME TO SERVE 25 YEARS TO LIFE ON LIES THERE TELLING OR EVEN LE SAME THING LIED TO THE COUNTY PROSECUTOR JUST SO I WOULD GET ARRESTED AND GET TIME HE THOUGHT AND IT TURNED OUT I DID WHAT I HAD TO DO NOT PROUD OF WHAT HAPPEN AND SHOULD KNOW ABOUT SEEKING MEDICAL ATTENTION FOR MY CHILD I AM DISABLED AND SICK OF GETTING TREATED BADLY HOW WOULD THEY LIKE IT IF I CALLED APS ON THEM FOR A CHANGE THEN THEY CAN COME AND ARREST THEM RIGHT OUT OF THE SCHOOL. NOW WE ARE HOMELESS AND THE CHILDREN ARE STAYING WITH A RELATIVE AND GUARDIAN AND THE SCHOOL WON'T LET THEM GO TO SCHOOL THERE BUT WANT THEM TO GO TO SCHOOL WHERE BULLYING IS ALLOWED REAL SMART THINKING ON A SCHOOL STAFF.

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