Nielsen v. Trans World Airlines, Inc.

___________
No. 95-4176
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Scott Nielsen; Douglas *
McSherry; H. P. Anderson; *
Thomas Carter, parties *
immediately above individually *
and for and on behalf of the *
Social Health Services Employee *
Assistance Program for TWA * Appeal from the United States
Employees, * District Court for the Western
* District of Missouri.
Appellants, *
* [PUBLISHED]
v. *
*
Trans World Airlines, Inc., *
*
Appellees. *
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Submitted: September 3, 1996
Filed: September 11, 1996
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Before BOWMAN, JOHN R. GIBSON, and BEAM, Circuit Judges.
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PER CURIAM.
Scott Nielsen, Douglas McSherry, Hal Anderson, and Thomas Carter
(plaintiffs) appeal from the District Court's1 award of $20,000 in attorney
fees to defendant Trans World Airlines, Inc. (TWA). We affirm.
Plaintiffs sued TWA in December 1993, alleging violations of the
Employment Retirement Income Security Act2 (ERISA). After
1
The Honorable Dean Whipple, United States District Judge for
the Western District of Missouri.
2
Pub. L. No. 93-406, 88 Stat. 829 (codified as amended at 29
U.S.C. §§ 1001-1461 (1994), and in scattered sections of the United
States Code).
conducting a bench trial, the District Court ruled in favor of TWA, and we
summarily affirmed in an unpublished per curiam opinion. Nielsen v. Trans
World Airlines, Inc., 81 F.3d 165 (8th Cir. 1996) (table). Meanwhile, TWA
applied for attorney fees, asserting it had incurred fees of over $149,000
in a lawsuit plaintiffs had pursued out of vindictiveness. The District
Court subsequently awarded TWA $20,000 in attorney fees under its inherent
power and Federal Rule of Civil Procedure 11. The court stated that "[t]he
fact that [plaintiffs] may have had some legitimate disputes with TWA in
other areas did not merit the filing of this ERISA action." Nielsen v.
Hart, No. 93-1237, order at 8 (W.D. Mo. Oct. 5, 1995). The court found
that plaintiffs pursued this lawsuit "in bad faith and for no purpose other
than to harass and badger TWA." Id. at 4.
On appeal, plaintiffs argue that the District Court abused its
discretion in assessing fees pursuant to either its inherent power or Rule
11, because this action was not completely colorless or brought in bad
faith. They also argue that the District Court should not have assessed
fees without having any information as to their ability to pay.
We have previously noted that the Supreme Court has held that a
district court may assess attorney fees under its inherent power "when a
party has acted in bad faith, vexatiously, wantonly, or for oppressive
reasons." Dillon v. Nissan Motor Co., 986 F.2d 263, 266 (8th Cir. 1993).
We review for an abuse of discretion the District Court's imposition of
sanctions. Id. at 267. "This is true with regard not only to the sanction
imposed, but also to the factual basis for the sanction." Id. Having
reviewed the parties' briefs and separate appendices, we cannot say the
District Court abused its discretion in assessing $20,000 in attorney fees
against
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plaintiffs, after finding they acted in bad faith and for an improper
purpose.3
Plaintiffs' reliance on In re General Motors Corp., 3 F.3d 980, 984
(6th Cir. 1993) (holding GM's employee assistance program qualified as
ERISA plan), is misplaced, because plaintiffs' allegations had very little,
if anything, to do with ERISA and TWA's employee assistance program.
Moreover, the mere fact that one of plaintiffs' claims survived a motion
for summary judgment and a Federal Rule of Civil Procedure 52(c) motion at
trial for judgment on partial findings does not preclude the imposition of
attorney fees. See Flowers v. Jefferson Hosp. Ass'n, 49 F.3d 391, 393 (8th
Cir. 1995). We reject plaintiffs' final argument regarding ability to pay,
as they presented no financial information to the District Court, and in
fact opposed TWA's motion to disclose such information. See Brandt v.
Schal Assocs., Inc., 960 F.2d 640, 652 (7th Cir. 1992); White v. General
Motors Corp., 908 F.2d 675, 685 (10th Cir. 1990), cert. denied, 498 U.S.
1069 (1991).
Accordingly, the judgment of the District Court is affirmed.
A true copy.
Attest:
CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.
3
As the District Court did not abuse its discretion in
assessing fees under its inherent power, we need not consider
whether such a sanction was proper under Rule 11.
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