McELWAINE v. US WEST, INC., 1999 U.S. App. LEXIS 8763 (9^th Cir. May 10, 1999)-Ninth Circuit reversed district court's refusal to award fees to a plaintiff who lost a summary judgment motion in district court.

In 1990 Plaintiff took early retirement from defendant and received a lump sum from defendant's pension plan. Five years later Plaintiff learned that Defendant improperly calculated the death benefit portion of the lump sum. Defendant reduced the death benefit by the actuarial probability there would a qualified beneficiary alive to receive the death benefit. The plan required the death benefit to be calculated with 100% probability there would be a qualified beneficiary alive to receive the death benefit.

In March 1995 plaintiff notified defendant of the error. Defendant initially denied plaintiff's claim. In September 1995, Plaintiff appealed the denial. In January 1996, defendant informed plaintiff that plaintiff was correct and that defendant would obtain IRS approval of defendant's efforts to correct the error. However, defendant never told plaintiff how it would correct the error or when it would submit the proposal to the IRS. Plaintiff tried repeatedly to learn about defendant's proposal but defendant s aid it was uncomfortable sharing that information with the plaintiff.

Unbeknownst to the plaintiff, on March 15, 1996, defendant submitted its proposal to the IRS.

In May 1996 the statute of limitations ran on plaintiff's claim. The statute of limitations for an ERISA benefits action is based on the applicable statute of limitations for a contract claim in the forum state. See e.g., Flanagan v. Inland Empire Electrical Workers Pension Plan & Trust, 3 F.3d 1246, 1252 (9th Cir. 1993). Arizona, the forum state, has a six year statute of limitations. Therefore, in March 1996, Plaintiff retained counsel. On April 4, 1996, Plaintiff sued.