                          In the
 United States Court of Appeals
               For the Seventh Circuit
                       ____________

No. 01-4141
MARK FRITCHER and COUNTRY TRUST BANK,
                                        Plaintiffs-Appellees,
                             v.

HEALTH CARE SERVICE CORPORATION,
                                       Defendant-Appellant.
                       ____________
          Appeal from the United States District Court
                for the Central District of Illinois.
       No. 00-1210—John A. Gorman, Magistrate Judge.
                       ____________
     ARGUED JUNE 4, 2002—DECIDED AUGUST 23, 2002
                     ____________


 Before COFFEY, EASTERBROOK, and WILLIAMS, Circuit
Judges.
   COFFEY, Circuit Judge.     Plaintiffs Mark Fritcher
(“Fritcher”) and Country Trust Bank (“the Bank”) sued
Defendant Health Care Service Corporation (“HCSC”)
for failing to pay benefits that the plaintiffs alleged
were due under Fritcher’s employee benefit plan, which
HCSC administered. The district court granted the plain-
tiffs’ motion for summary judgment, and HCSC appeals.
We affirm.
2                                                   No. 01-4141

              I. FACTUAL BACKGROUND
  Fritcher works for Mitsubishi Motor Manufacturing of
America (“MMMA”) and is a participant in the MMMA
employee benefit plan (“the Plan”). The parties agree that
the Plan is an employee welfare benefit plan governed
by ERISA. (Def.’s Br. at 8; Pl.’s Br. at 7.) See 29 U.S.C.
§ 1001, et seq. The Bank is the trustee of the Lucas Fritcher
Trust. Lucas Fritcher, the son of Plaintiff Mark Fritcher,
is a beneficiary under the Plan. Lucas was born with
certain serious birth defects in 1989, and by virtue of his
severe health problems (e.g., severe hypoxic encephalop-
athy,1 severe cerebral palsy, frequent daily seizures, cleft
palate, cortical blindness, microcephaly,2 severe mental
motor retardation, spastic quadriplegia, an inability to
swallow, asthma), (R. at 362-93; Pl.’s Ex. 12), Lucas re-
quires constant medical care or monitoring (e.g., adminis-
tration of medication, frequent suctioning of his airway,
periodic application of oxygen, close monitoring and man-
agement of seizures, gastro-intestinal feedings) in order
to survive. (R. at 400-04; Pl.’s Ex. 12.)
  In 1994, the Plan began assuming the responsibility
for Lucas’ primary health coverage, and paid for an average
of eighteen hours per day of in-home health care for Lucas.
In a letter dated March 28, 1997, HCSC sent a letter
to Fritcher notifying him that effective May 1 of that
same year, the Plan would cover “a maximum of two
hours per day” for Lucas’ care, as anything beyond that


1
  Hypoxic encephalopathy is permanent and irreversible brain
damage caused by an inadequate flow of oxygen to the brain.
Dorland’s Illustrated Medical Dictionary 550, 810 (27th ed. 1988).
(R. at 366.)
2
   Microcephaly is a condition in which neither the skull nor the
brain grows because of some injury to the brain. Dorland’s
Illustrated Medical Dictionary 1032 (27th ed. 1988). (R. at 392.)
No. 01-4141                                               3

would be deemed to be “custodial care” and not “medically
necessary” under the terms of the Plan. HCSC asserted
that most of the in-home care Lucas was receiving did
not qualify as “Skilled Nursing Services” under the Plan.
  The term “Skilled Nursing Services” is defined under the
“Definitions” section of the Health Care Service Plan doc-
ument as “those services provided by a registered nurse
(R.N.) or licensed practical nurse (L.P.N.) which require
the technical skills and professional training of an R.N.
or L.P.N. . . . .” The definition adds that “Skilled Nurs-
ing Service does not include Custodial Care Service.”
“Custodial Care Service,” meanwhile, is defined under the
Plan as “those services which do not require the tech-
nical skills or professional training or medical and/or
nursing personnel in order to be safely and effectively
performed.” Under the “Exclusions—What Is Not Covered”
section of the Plan, “Custodial Care Service” is specifical-
ly delineated as a type of service that is not “Medically
Necessary” under the terms of the Plan.
  HCSC’s determination to reduce benefits was based
largely on the work of one Dr. Robert Fucik. Fucik, a part-
time practicing endocrinologist, acknowledged at trial
that he was not board-certified in any field, including
endocrinology. Fucik, a twenty-year HCSC employee, de-
termined after a review of the record that whatever
“skilled nursing care” Lucas was receiving could be ad-
ministered over the course of a one to two hour period.
Fucik admitted that he made his determination with-
out reference to Lucas’ need for skilled medical care
throughout the day and not simply during a one to two
hour period. (R. at 582.) Fucik also conceded that he
made his decision without reference to the number of
times a day Lucas had seizures, (R. at 587), which Lucas’
pediatrician noted as “frequent,” even up to twenty times
per day. (Pl.’s Ex. 66.)
4                                                    No. 01-4141

  After receiving HCSC’s March 28, 1997 letter curtail-
ing his son’s benefits, Fritcher took some action that
apparently satisfied his obligation under the “Claim Re-
view Procedure” outlined in the Plan. (Pl.’s Ex. 8 at 69.)3
Just two months after its first letter, HCSC responded
to Fritcher’s request for “additional information regard-
ing [HCSC’s] recent review of the nursing notes and
subsequent determination of the services being provided
as custodial care.” (Pl.’s Ex. 9.) In this letter, dated May
28, 1997, HCSC repeated its assertion that “the services
being provided represent approximately 2 hours daily
which fulfill the technical and professional training of
an RN or LPN,” and maintained its position that “as of
5/1/97, benefits will be limited to 2 hours a day.” (Id.)


              II. PROCEDURAL POSTURE
  On June 26, 1998, Fritcher and the Bank timely filed an
action in federal district court under the Employee Retire-
ment Income Security Act of 1974 (“ERISA”), 29 U.S.C.
§ 1001, et seq., seeking judicial review of the Plan adminis-
trator’s decision to deny benefits. In November 1999, the
matter was tried in a bench trial before the Honorable
Michael P. McCuskey, United States District Court Judge.
Before rendering his opinion, Judge McCuskey recused
himself in an order dated June 8, 2000 because of his own



3
  This circuit has long recognized that district courts have
discretion to require administrative exhaustion, and that we will
overturn a district court’s decision only for a clear abuse of
discretion. See Gallegos v. Mt. Sinai Med. Ctr., 210 F.3d 803, 808
(7th Cir. 2000). Here, even though it is not clear that Fritcher’s
“ask[ing] for additional information,” (R. at 119, p. 6), exhausted
his administrative remedies under the Plan, there does not ap-
pear to be sufficient reason to disturb the magistrate judge’s dis-
cretion on this point.
No. 01-4141                                                5

brewing conflict with a division of HCSC. (R. at 96.) The
matter was thereupon reassigned to Magistrate Judge
John A. Gorman of the Peoria District of the United
States District Court for the Central District of Illinois.
   In December 2000, the parties filed cross motions for
summary judgment. On March 20, 2001, Magistrate Judge
Gorman granted summary judgment in favor of the plain-
tiffs and against the defendant on the issue of liability. On
November 15, 2001, the district court awarded damages
to plaintiffs and against defendant in the amount of
$341,142.03, awarded plaintiffs their attorney’s fees and
costs in the amount of $112,286.22, and prejudgment
interest in the amount of $56,170.11. HCSC filed a notice
of appeal on November 30, 2001.


                   III. DISCUSSION
          A. The Summary Judgment Grant
  HCSC asks this court to reverse the district court’s
grant of summary judgment in favor of the plaintiffs. A
summary judgment motion must be granted if there is “no
genuine issue as to any material fact.” Celotex Corp. v.
Catrett, 477 U.S. 317, 323 (1986). “Only disputes over
facts that might affect the outcome of the suit under the
governing law will properly preclude the entry of sum-
mary judgment. Factual disputes that are irrelevant or
unnecessary will not be counted.” Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 248 (1986). We review a grant
of summary judgment de novo, viewing all the facts and
drawing all reasonable inferences therefrom in favor of
the nonmoving party. See Butera v. Cottey, 285 F.3d 601,
605 (7th Cir. 2002).
6                                                    No. 01-4141

            B. The Administrator’s Decision
                                1.
  The primary issue in this case is whether the magis-
trate judge applied the correct standard of review to the
plan administrator’s decision to deny benefits. It is signifi-
cant to note at the outset that this court’s opinion in
Herzberger v. Standard Insurance Co., 205 F.3d 327 (7th
Cir. 2000), the holding of which is directly relevant to
this type of dispute, was decided in February 2000, shortly
after the parties’ bench trial (in November 1999) but before
the magistrate judge had issued his grant of summary
judgment in March 2001.
  The gravamen of HCSC’s argument is that the magis-
trate judge applied the wrong standard of review when
analyzing HCSC’s interpretation of Plan language. Specifi-
cally, HCSC maintains that its interpretation, as the Plan’s
“Claims Administrator,” of what is “medically necessary”
under the Plan ought to have been examined under the
deferential “arbitrary and capricious” standard.4 HCSC



4
   We note in passing that a previous decision from a panel of this
court once noted a distinction between the “arbitrary and capri-
cious” standard of review and the “abuse of discretion” standard
of review. See Morton v. Smith, 91 F.3d 867, 870 (7th Cir. 1996).
As we have subsequently pointed out, however, this appears to
be a distinction without a difference. See, e.g., Ladd v. ITT Corp.,
148 F.3d 753, 754 (7th Cir. 1998) (noting that whether the
administrator “abused its discretion,” “acted unreasonably,” or
“exercised its discretion in an ‘arbitrary and capricious’ manner”
were merely “different ways of saying the same thing”); Ross v.
Indiana State Teacher’s Ass’n Ins. Trust, 159 F.3d 1001, 1009
(7th Cir. 1998) (stating that “[t]he distinction between these stan-
dards is indeed nebulous”); Gallo v. Amoco Corp., 102 F.3d 918,
921 (7th Cir. 1996) (framing the issue for decision as whether
the defendant “had abused its discretion, or what amounts to the
same thing, had acted arbitrarily and capriciously”).
No. 01-4141                                                 7

objects to the magistrate judge’s use of the less deferential
de novo standard. HCSC asserts that Plan language be-
stowing upon the Plan administrator the right to exer-
cise “reasonable judgment” in determining whether services
are medically necessary is a sufficient grant of “discre-
tion” under the law of this circuit to trigger a milder stan-
dard of review.
  We disagree. As this court held in Herzberger, an ERISA
plan is “a special kind of contract,” in which there exists “a
presumption of full judicial review at the behest of the
[participant or beneficiary].” Id. at 330. Thus, this “pre-
sumption of plenary review is not rebutted by the plan’s
stating merely that benefits will be paid only if the plan
administrator determines they are due, or only if the
applicant submits satisfactory proof of his entitlement
to them.” Id. at 331. Such truisms do not “give the employ-
ee adequate notice that the plan administrator is to
make a judgment largely insulated from judicial review
by reason of being discretionary.” Id. at 332. Without
such notice of the employer’s intention “to reserve a
broad, unchanneled discretion to deny claims,” id. at 333,
the employee cannot make informed choices about his
benefits, such as the decision as to whether he should
supplement his ERISA plan with other forms of insur-
ance. See id. at 331.
  It is clear from the undisputed facts on the record that
HCSC has failed to dispel the presumption against plenary
review. The language that HCSC cites is simply not suffi-
cient under Herzberger. HCSC first claims that the “Plan
documents” bestow the requisite degree of discretion up-
on HCSC. HCSC points to the “Benefit Booklet,” a docu-
ment which the Plan adopted and incorporated by refer-
ence that summarized benefits for the participants and
beneficiaries. This booklet states that benefits will be
provided for services only if they are, “in the reason-
able judgment of the Claim Administrator, Medically
Necessary.”
8                                                    No. 01-4141

  After a thorough review of the facts and the law, we
hold that the phrase “in the reasonable judgment of the
Claim Administrator” does not rise to the level articu-
lated by the Herzberger court to rebut the presumption of
plenary review.5 In Herzberger, this court stated that
“[o]bviously a plan will not—could not, consistent with
its fiduciary obligation to the other participants—pay
benefits without first making a determination that the
applicant was entitled to them.” Id. at 332. The phrase
“reasonable judgment of . . . medical[ ] necess[ity]” does
not signal subjective discretion; in fact, it implies some
process of ratiocination will be used before benefits will
be paid. See id. at 333 (holding that discretionary power
could be presumed only upon a subjective, rather than
objective, test). Most importantly, the words “reasonable
judgment” do not serve as adequate notice to the partici-
pant and his family that the administrator’s judgment
will be insulated from judicial review, particularly after
Herzberger. “An employer should not be allowed to get
credit with its employees for having an ERISA plan that
confers solid rights on them and later, when an employ-
ee seeks to enforce the right, pull a discretionary ju-
dicial review rabbit out of his hat.” Id. at 332-33.


5
   Judicial review of a plan administrator’s decision must, ordi-
narily, be particularly penetrating when the facts illustrate that
an administrator has a conflict of interest. See, e.g., O’Reilly v.
Hartford Life & Accident Ins. Co., 272 F.3d 955, 960 (7th Cir.
2001) (holding that an administrator’s conflict of interest “is
a factor to be considered” when reviewing an administrator’s
decision); Ladd, 148 F.3d at 754 (stating that when it is clear
that the “administrator has a conflict of interest . . . though the
standard of review is nominally the same, the judicial inquiry
is more searching”); Van Boxel v. Journal Co. Employees’ Pension
Trust, 836 F.2d 1048, 1050-51 (7th Cir. 1987). Here, however,
neither side has argued the issue and therefore we need not
address it.
No. 01-4141                                                   9

  HCSC also points to language in its “Administrative
Services Agreement” (“ASA”) between HCSC and MMMA
as evidence that HCSC enjoys “discretion” under the terms
of the “Plan.” There are two problems with this argument.
First, the language cited—“the Claim Administrator in
its sole discretion reserves the right to pay any benefits
that are payable under the terms of this Agreement di-
rectly to the Covered Employee or to the Provider of the
service”—has nothing whatever to do with discretion in
awarding benefits. It simply provides that HCSC can pay
whomever it wishes in the first instance for services
rendered. This court has expressly held that discretion-
ary language appearing in a non-relevant passage of an
ERISA plan “does not grant the administrator discretion to
determine eligibility for benefits.” Postma v. Paul Revere
Life Ins. Co., 223 F.3d 533, 539 (7th Cir. 2000).
   The second problem with HCSC’s use of the ASA is that
it is not a “plan document” for purposes of holding its terms
against a plan participant or beneficiary.6 See, e.g., Local
56, United Food & Comm. Workers Union v. Campbell
Soup Co., 898 F. Supp. 1118, 1136 (D.N.J. 1995) (“A for-
mal plan document is one which a plan participant could
read to determine his or her rights or obligations under the
plan.”), citing Curtiss-Wright Corp. v. Schoonejongen, 514
U.S. 73, 83 (1995) (noting that one of ERISA’s basic pur-
poses was to afford employees the opportunity to in-
form themselves, “on examining the plan documents,” of
their rights and obligations under the plan), quoting
H.R. Rep. No. 93-1280, at 297 (1974), reprinted in 1974
U.S.C.C.A.N. 4639, 5077, 5078.




6
  Plaintiffs themselves seem confused on this point. See Pl.’s
Br. at 19 (referring to “paragraph H of the plan,” when they ob-
viously mean the ASA).
10                                               No. 01-4141

                             2.
  Having established that the standard of review by
which we are required to examine HCSC’s benefit denial
in this case is de novo, we now turn to the decision itself.
The magistrate judge found that “the plan’s decision to
cut the benefits it provided to Lucas Fritcher was errone-
ous,” as “[i]t is clear that much of Lucas’ care must either
be rendered by a registered nurse or by a licensed prac-
tical nurse as directed and supervised by a registered
nurse.”
  We agree with the ultimate determination of the mag-
istrate judge, but for different reasons than those he offered
in his order. It is not clear from the magistrate judge’s
March 20, 2001 order what impact the “Nursing and
Advanced Practice Nursing Act, 225 Ill. Comp. Stat. 65/5-1
et seq.” has on Lucas’ care. The passages cited in the order
(defining “practical nursing” and “registered professional
nursing practice”) do not necessarily support the conclu-
sion that Illinois law prohibits a non-licensed health care
provider from taking care of Lucas, or that the care Lucas
was receiving could be considered “skilled nursing services”
under the terms of the Plan.
  What is clear from the undisputed facts on the record,
however, is that HCSC denied benefits despite its knowl-
edge that Lucas needed “skilled medical care” under the
terms of the Plan, that such care should have been covered
under the Plan, and that Lucas’ need for such care was
scattered throughout the day. Dr. Fucik, the HCSC em-
ployee who was largely responsible for the benefit reduc-
tion, admitted that the periodic monitoring of the oxygen
content in Lucas’ bloodstream was a skilled service, (R. at
585), and that the periodic monitoring of Lucas’ breath-
ing was a skilled service. (R. at 625.) He further admit-
ted that his own notes reflected the fact that Lucas
was receiving “a scattering of skilled services” that were
No. 01-4141                                                  11

“being provided during approximately 18 hours per daily
nursing services.” (R. at 581; Dep. Ex. Fucik #3). Dr. Fucik
also admitted that he ignored the frequency of Lucas’
seizures when making his determination, (R. at 587), even
though the nurses’ reports—the same ones that Dr. Fucik
claimed to have reviewed while making his determina-
tion (R. at 541, 548)—showed that Lucas frequently had
seizures. (Def.’s Ex. #50.) HCSC obviously knew that
for someone in Lucas’ condition, monitoring and control-
ling these seizures is critically important. (Pl.’s Ex. 12; Pl.’s
Ex. 55A; Dep. Ex. Fucik #7 at 3.) Based on these facts
alone, and without having to examine Illinois law, HCSC’s
decision to confine benefits to a 2-hour period is patently
unreasonable. See Govindarajan v. FMC Corp., 932
F.2d 634, 637 (7th Cir. 1991) (holding that a selective
review of medical evidence and a conclusion based on that
selectivity was unreasonable). Thus, we affirm the district
court’s grant of summary judgment in favor of the plain-
tiffs with respect to liability. See Gallo v. Amoco Corp.,
102 F.3d 918, 923 (7th Cir. 1996) (noting that remand is
the appropriate remedy in similar cases except where
“the case is so clear cut that it would be unreasonable
for the plan administrator to deny the application for
benefits on any ground”). Because we reach our decision
on these grounds, we need not address either of HCSC’s
two remaining arguments: (1) the propriety of the dis-
trict court’s analysis of the “administrative record”; and
(2) the applicability of the doctrine of ERISA preemption of
the Illinois statute.


              C. Attorney’s Fees and Costs
  HCSC argues that the district judge’s award of attor-
ney’s fees and costs to the plaintiffs was erroneous. ERISA
allows a court, in its discretion, to award “a reasonable
attorney’s fee and costs of action to either party.” 29 U.S.C.
12                                               No. 01-4141

§ 1132(g)(1). We review such an award for an abuse of
discretion. See, e.g., Trustmark Life Ins. Co. v. Univ. of
Chicago Hosps., 207 F.3d 876, 884 (7th Cir. 2000); Little
v. Cox’s Supermarkets, 71 F.3d 637, 644 (7th Cir. 1995)
(holding that “a district court’s determination will not
be disturbed if it has a basis in reason”).
  This circuit has recognized two tests for analyzing
whether attorney’s fees should be awarded to a “prevail-
ing party” in an ERISA case. See Quinn v. Blue Cross &
Blue Shield Ass’n, 161 F.3d 472, 478 (7th Cir. 1998). The
district court below essentially employed the first of
these two tests, (R. at 119, p. 9), which looks at the follow-
ing five factors: (1) the degree of the offending party’s
“culpability or bad faith”; (2) the degree of the offend-
ing party’s ability to satisfy an award of attorney’s fees;
(3) the degree to which such an award would “deter other
persons acting under similar circumstances”; (4) the
amount of benefit conferred on all the plan members; and
(5) the relative merits of the the parties’ positions. Quinn,
161 F.3d at 478.
  In applying these five factors to the facts at hand, the
magistrate judge found that “[t]here is some evidence
of culpability on the part of the Plan that goes beyond
simply an erroneous decision.” (R. at 119, p. 9.) The judge
pointed to the fact that after the plaintiffs filed suit, HCSC
re-evaluated the claim, deciding that an award of twelve
hours per day of medical care was appropriate. (Pl.’s Ex.
12.) The judge found this to be “a dramatic turn-around.”
(R. at 119, p. 9.) The judge viewed with similar dismay
“the fact that it took four months for the new pay-
ment level to be implemented,” as it suggested “at best
that the Plan dragged its feet.” (Id.) The judge also found
that the second and third factors weighed in favor of an
award to the plaintiffs, as “[t]here is no evidence question-
ing the ability of the Plan to pay such an award, and
there is no question that such an award would serve to
No. 01-4141                                               13

deter this Plan and others from making the kind of super-
ficial evaluation seen in this case, especially when the
evaluation has such an enormous impact on the lives of
the participants and beneficiaries.” (Id. at 9-10.) As
to the fourth and fifth factors, the judge reasoned that
the likely improvements that would be made to the Plan’s
review procedures could only help all Plan participants,
and that the merits of the case “were strongly on the side
of plaintiffs.” (Id. at p. 10.)
  Based on our review of the record, the briefs, and control-
ling law, we find the magistrate judge’s award of attor-
ney’s fees and costs was reasonable. We also find that
the amount of the award, $96,922.50 in attorney’s fees
and $15,363.72 in costs, was similarly well-reasoned. In
his order dated November 15, 2001, the magistrate judge
followed the applicable law for such awards. (R. at 141,
pp. 2-4.) See Hensley v. Eckerhart, 461 U.S. 424, 433-34
(1983) (holding that the starting point for the calculation
of attorney’s fees is the “lodestar” amount, or the product
of the number of hours reasonably expended and a rea-
sonable hourly rate); McNabola v. Chicago Transit Auth.,
10 F.3d 501, 519 (7th Cir. 1993) (defining a “reasonable
hourly rate” as “the rate that lawyers of a similar abil-
ity and experience in the community normally charge to
their paying clients”). The magistrate judge also careful-
ly scrutinized the record for the reasonability of the award,
looking at the attorneys’ billing records and rejecting the
plaintiff’s request for an “enhancement” because, inter alia,
no new law was made in this case. (R. at 119, p. 5.) We
affirm the magistrate judge’s finding on both the pro-
priety and the amount of the attorney’s fees and costs
awarded in this case.


                D. Prejudgment Interest
 HCSC argues that the district judge’s award of prejudg-
ment interest to the plaintiffs was erroneous. Case law from
14                                                No. 01-4141

this circuit and other circuits suggests that prejudgment
interest may be appropriate in ERISA cases. See, e.g.,
Trustmark, 207 F.3d at 885; Tiemeyer v. Cmty. Mut. Ins.
Co., 8 F.3d 1094, 1102 (6th Cir. 1993); Quesinberry v. Life
Ins. Co. of North America, 987 F.2d 1017, 1030 (4th Cir.
1993). We have previously held that “prejudgment interest
should be presumptively available to victims of federal law
violations. Without it, compensation of the plaintiff is
incomplete and the defendant has an incentive to delay.”
Gorenstein Enters., Inc. v. Quality Care-USA, Inc., 874 F.2d
431, 436 (7th Cir. 1989). This “presumption in favor of
prejudgment interest awards is specifically applicable
to ERISA cases.” Rivera v. Benefit Trust Life Ins. Co.,
921 F.2d 692, 696 (7th Cir. 1991). Whether to award an
ERISA plaintiff pre-judgment interest is “a question of
fairness, lying within the court’s sound discretion, to be
answered by balancing the equities.” Trustmark, 207 F.3d
at 885, citing Landwehr v. DuPree, 72 F.3d 726, 739 (9th
Cir. 1995) (quotations omitted).
  Contrary to the assertion in HCSC’s brief, “bad faith” is
not the sole criterion when considering whether an award
of prejudgment interest is appropriate. (Def.’s Br. at 52.)
See Trustmark, 207 F.3d at 885 (citing “bad faith” as
“[o]ne of the factors” to be considered). As the magistrate
judge pointed out, the award was simply aimed at mak-
ing the plaintiffs whole, who were forced to deplete
their assets in order to provide for Lucas’ care during
the period in which benefits were wrongly withheld. (R. at
132, p. 4; R. at 141, p. 6.)
  The sole remaining issue is our review of the magis-
trate judge’s calculation of the amount of prejudgment
interest, another item which is left to the discretion of
the district court. See Gorenstein, 874 F.2d at 436. In
Gorenstein, this court “suggest[ed] that district judges
use the prime rate for fixing prejudgment interest where
there is no statutory interest rate,” id., but also “caution[ed]
No. 01-4141                                            15

them against the danger of setting prejudgment interest
rates too low by neglecting the risk, often nontrivial, of
default.” Id. at 437.
   Here, where no statutory interest rate applies, we see
no reason to disturb the magistrate judge’s decision to
award prejudgment interest at a rate of 8.33%, for a total
sum of $56,170.11, to the plaintiffs. (R. at 141.) As the
magistrate judge noted, the defendants could have been
charged with even more had the plaintiffs sought com-
pounding interest, which the district court in its discre-
tion could have awarded. See Gorenstein, 874 F.2d at 437
(listing cases).


                  IV. CONCLUSION
  We hold that the district court’s decision to grant the
plaintiffs’ motion for summary judgment was proper, as
was the district court’s award of attorney’s fees, costs,
and prejudgment interest.
                                               AFFIRMED.

A true Copy:
      Teste:

                       ________________________________
                       Clerk of the United States Court of
                         Appeals for the Seventh Circuit




                   USCA-97-C-006—8-23-02
