Anderson v. Flexel, Inc.

• Decision Date: 10 February 1995
• Docket Number: Nos. 94-2460,94-2845,s. 94-2460
• Citation: 47 F.3d 243
• Parties: Emma ANDERSON, Plaintiff-Appellee, v. FLEXEL, INC., Defendant-Appellant.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 243

47 F.3d 243

Emma ANDERSON, Plaintiff-Appellee, v. FLEXEL, INC., Defendant-Appellant.

Nos. 94-2460, 94-2845.

United States Court of Appeals Seventh Circuit.

Argued Dec. 7, 1994.

Decided Feb. 10, 1995.

Gill M. Garman (argued), Sebat, Swanson, Banks, Garman & Townsley, Danville, IL, for plaintiff-appellee.

Don P. Campbell, Wallace, Campbell, Bunch, Shambach, Rennick & Orr, Covington, IN, Dara L. DeHaven (argued), Ogletree, Deakins, Nash, Smoak & Stewart, Atlanta, GA, for defendant-appellant in No. 94-2460.

Dara L. DeHaven (argued), Rosemary Globetti, Ogletree, Deakins, Nash, Smoak & Stewart, Atlanta, GA, for defendant-appellant in No. 94-2845.

Before REAVLEY, ^* FLAUM, and KANNE, Circuit Judges.

FLAUM, Circuit Judge.

Emma Anderson sued her deceased son's employer, Flexel, Inc. ("Flexel"), for statutory penalties under the Employee Retirement Income & Security Act ("ERISA"), 29 U.S.C. Sec. 1132(c), for its failure to provide her with documents relating to her son's life insurance policy. The district court awarded Ms. Anderson penalties and attorney's fees and this appeal followed. We now affirm in part, reverse in part and remand.

I.

Harry Anderson, a Flexel employee and union member, participated in a group life insurance policy issued by Jefferson Pilot Life Insurance Company ("Jefferson Pilot") to Flexel pursuant to a collective bargaining agreement between Flexel and the union. On July 1, 1983, Anderson completed the "Hourly Benefit Enrollment Record" for his life insurance policy. He named his mother, Emma Anderson, in the space provided for "Insurance Beneficiary Designations." Below that, the space marked "Other Beneficiary/Or Change in Beneficiary" listed Harry's daughter, "Constlasa [sic] M. Wilson." Underneath these designations the enrollment record provided:

If more than one beneficiary is designated, settlement will be made in equal shares to such of the beneficiaries (or beneficiary) as survive the insured, unless otherwise provided herein.

On February 25, 1986, Harry signed a "Request For Change of Name, Beneficiary Or Replacement Of Certificate" form. "Constlasa Wilson" was typed in the space designated "Change of Beneficiary." "Constlasa" was then crossed out by pen and "Constelsa" was handwritten above it. The request form stated: "By this request I revoke all prior beneficiary designations." Diane Luzader, Flexel's personnel clerk, witnessed Harry's execution of this form. At trial, she testified that Harry had intended to change his insurance beneficiary to Constelsa. On cross-examination, however, Luzader admitted that she had previously testified in a deposition that she could not recall what type of change Harry wanted to make with the form.

Harry died while leaving work on December 30, 1986. Flexel's Industrial Claims Manager contacted Emma, who Flexel had determined was Harry's next of kin, to tell her that Harry had passed away. While at the Leek Funeral Home to make arrangements, the funeral director told Emma that Flexel had informed him that a "child was involved" with the life insurance. Emma called Flexel and was simply told that "it was up to the Wilson family." Testimony at the bench trial and memoranda between Flexel and Jefferson Pilot indicate that both companies knew about a problem with Harry's beneficiary designation from the day he died. Even with this confusion, however, Jefferson Pilot paid the full policy benefit to Constelsa Wilson's guardian on October 26, 1987.

Emma retained attorney Curtis Anderson, who on March 18, 1987, requested from Flexel a copy of Harry's personnel file. Flexel told him that it did not release such information unless pending litigation required its disclosure. Attorney Anderson made another request, to which Flexel failed to respond. On August 15, 1987, James Anderson, Emma's son, asked Flexel for information, for himself and his mother, about Harry's insurance beneficiary. Flexel did not respond to this request. Finally, on October 3, 1988, attorney Richard Holmes requested information regarding Harry's life insurance. Once again, Flexel failed to respond.

Emma filed suit on March 3, 1992, alleging that Jefferson Pilot had wrongly paid out Harry's insurance benefits and that Flexel had failed to provide her with requested information, in violation of 29 U.S.C. Sec. 1132(c). Jefferson Pilot filed a third-party complaint against Constelsa who then settled the dispute over the insurance by paying Emma half of the policy proceeds. The district court first noted that Constelsa's name on the enrollment record had been typed by a different machine than had been used to type Emma's name and the rest of the information on the record. The court inferred that Luzader had typed Constelsa's name on both beneficiary forms on February 26, 1986. The court then held that Harry had not intended to remove his mother as a beneficiary, but had only intended to add his daughter as a co-beneficiary with the "Change in Beneficiary" form.

In light of these findings, the district court held that Jefferson Pilot had wrongly paid the policy proceeds to Constelsa. The court ordered Jefferson Pilot to pay Emma $19,234.08 in damages, a stipulated amount equal to 18% interest on the proceeds not distributed according to the terms of the policy. Jefferson Pilot has not appealed this decision.

Regarding Flexel's liability, the district court first held that Emma was a beneficiary under the insurance policy and was therefore entitled to request and receive certain information under ERISA. 29 U.S.C. Secs. 1002(8), 1024(b)(4). The court then held that the requests made on behalf of Emma by her son and her attorneys had triggered Flexel's duty to provide the requested information. While finding that Flexel's failure to provide requested information was not malicious, the court nonetheless, considering all of the circumstances, imposed on it a $50.00 per day fine from the date of James Anderson's letter to the date Flexel finally provided the information, which occurred only after Emma had filed this suit. This resulted in a total fine of $87,600. The court also ordered the defendants to pay costs of $455.30 and attorney's fees of $52,128.50, the lodestar doubled, which it later decreased to $26,064.25.

II.

On appeal, Flexel makes three arguments: that the district court improperly held that Emma's claims were not time-barred; that the district court improperly held that Emma made a request requiring Flexel to respond; and that the district court improperly awarded and calculated attorney's fees. We affirm the district court's determination that Emma's claims were timely filed, reverse in part and affirm in part the court's decision regarding Emma's requests for information, vacate the court's award of attorney's fees, and remand for further findings.

A.

Prior to trial, Flexel argued that Indiana's two-year statute of limitations for employment-related claims barred Emma's action. Ind.Code 34-1-2-1.5(a). ¹ The district court rejected this argument and found that because Harry's "relation to Flexel was based upon a written collective bargaining agreement and a written group life insurance," Indiana's ten-year statute of limitations for actions based on written contracts applied. Ind.Code 34-1-2-2(6). It therefore held that Emma's claims were not time-barred. In its post-judgment motions, Flexel for the first time urged that the two-year statute of limitations pertaining to "forfeiture[s] of penalty given by statute," Ind.Code 34-1-2-2(1), applies to this case because 29 U.S.C. Sec. 1132(c) ² is essentially penal in nature. Flexel thus asks us to reverse the district court's decision. We review statute of limitations determinations de novo. Union Carbide v. State Board of Tax Com'rs., 992 F.2d 119, 121 (7th Cir.1993).

While we might be inclined to find that the two-year statute of limitations for statutory penalties applies to Sec. 1132(c) claims, our inclination does not matter because Flexel has waived this argument. Flexel raised an affirmative statute of limitations defense in its answer to Emma's complaint, but argued only the employment-related claim statute pre-judgment. Flexel did not contend that the statutory penalty limitations period barred Emma's claims until its post-trial Motion to Amend Findings of Fact and/or for a New Trial. We have repeatedly stated that post-judgment motions cannot be used to raise arguments or legal theories that could have been and should have been brought before judgment. Woods v. City of Michigan City, Ind., 940 F.2d 275, 280 (7th Cir.1991); Weihaupt v. American Medical Ass'n, 874 F.2d 419, 425 (7th Cir.1989); FDIC v. Meyer, 781 F.2d 1260, 1268 (7th Cir.1986); see also MEI International, Inc. v. Schenkers International Forwarders, Inc., 807 F.Supp. 979, 990 (S.D.N.Y.1992) (failure to raise statute of limitations defense prior to post-trial motions resulted in waiver). Furthermore, we have specifically held that a general allegation of a statute of limitations defense did not preserve for appeal a specific two-year statute, which actually applied, where the defendant had only argued a different limitations period to the district court. Heiar v. Crawford County, Wis., 746 F.2d 1190, 1196-97 (7th Cir.1984), cert. denied, 472 U.S. 1027, 105 S.Ct. 3500, 87 L.Ed.2d 631 (1985); see also Saunders v. George Washington University, 768 F.Supp. 854, 868 (D.D.C.1991) (failure to argue specific statute of limitations, even though others were argued, constituted a waiver).

In arguing that it has not waived the statutory penalty statute of limitations, Flexel cites to Brooms v. Regal Tube, in which we stated that "[a]t a minimum, a party must request [pre-judgment] interest in a post- trial motion if he or she has failed to plead the relief in the original complaint." 881 F.2d 412, 424 n. 9 (7th Cir.1989). Such late presentation of the right to pre-judgment interest is allowed, however, because Fed.R.Civ.P. 54(c)...