Court rules MetLife owes couple nearly $500,000 for attorneys' fees in insurance claim dispute

By Charmaine Little | Jan 18, 2019

SAN FRANCISCO – On Jan. 7, a federal court granted in part a couple’s motion for judgment award against their insurance company after they were denied coverage several times for payment of accident dismemberment benefits.

The U.S. District Court for the Northern District of California granted in part and denied in part plaintiffs Tommy Dowdy and Sharon Morris-Dowdy’s motion for award of prejudgment interest and attorney’s fees against insurance company and defendant MetLife.

U.S. District Judge Jon S. Tigar determined MetLife owed the plaintiffs $482,557.66 for attorneys’ fees and interest.

The plaintiffs sued via the Employee Retirement Income Security Act for payment of accidental dismemberment benefits following Dowdy’s injury in a car accident. The result state Dowdy needed a below-the-knee amputation five months after. 

While the plaintiffs bought accidental death and dismemberment insurance through MetLife, they were denied their claim as MetLife said there was no proof Dowdy had an actual injury other than an ankle fracture. MetLife was then issued records to show the amputation but still denied the claim as it said the report showed the amputation was complicated by diabetes. 

After denying the claim a third time amid the plaintiffs' appeals, the couple filed the current lawsuit. After a ruling and an appeal, MetLife said it would pay $200,000 in dismemberment benefits and $27,769 in hospitalization benefits. The plaintiffs responded with a request for attorneys’ fees of $253,820 incurred in the appeal.

The court determined since MetLife paid the couple a little more than they asked for in the complaint after the court determined they were owed benefits, the plaintiffs should get reasonable attorneys’ fees. 

After looking at the market rate and claimed hours for one attorney, the court determined the plaintiffs were entitled to $267,015 for attorneys’ fees and costs at the district court level. As for the attorneys’ fees for the appeal, which the plaintiffs won, the court said they were owed $215,542.50.

As for the interest, the court invoked a one-year treasury constant maturity rate of 2.5 percent. Ultimately, the plaintiffs were awarded a total of $482,557.66 plus prejudgment interest for 2.5 percent.

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