Barry v. Heckler

• Decision Date: 13 January 1986
• Docket Number: No. C-83-6178 WHO.,C-83-6178 WHO.
• Citation: 638 F. Supp. 444
• Court: U.S. District Court — Northern District of California
• Parties: George L. BARRY, Plaintiff, v. Margaret M. HECKLER, Secretary, Department of Health and Human Services, Defendant.

638 F. Supp. 444

George L. BARRY, Plaintiff, v. Margaret M. HECKLER, Secretary, Department of Health and Human Services, Defendant.

No. C-83-6178 WHO.

United States District Court, N.D. California.

January 13, 1986.

Harvey P. Sackett, San Jose, Cal., for plaintiff.

Joseph P. Russoniello, U.S. Atty., N.D. Cal., and Judith A. Whetstine, Asst. U.S. Atty., San Francisco, Cal., for defendant.

OPINION AND ORDER

ORRICK, District Judge.

The sole issue remaining to be decided in this supplemental security income ("SSI") case is whether plaintiff, who prevailed on the merits, is entitled to recover attorney's fees and costs under the Equal Access to Justice Act ("EAJA"), 28 U.S.C. § 2412. For the reasons set forth below, the Court finds that plaintiff's counsel is entitled to an award of attorney's fees in the amount of $16,387.50 for his services in this lawsuit, plus costs of $251.50.

I

A

The Bellmon Review Program was installed by the Secretary of Health and Human Services ("Secretary") to implement Congress' mandate to review, on the Secretary's own motion, decisions rendered by administrative law judges ("ALJs"). Pub.L. No. 96-265, § 304(g), 94 Stat. 441, 456 (1980) (the Bellmon Amendment). In passing the Bellmon Amendment, Congress intended to improve the quality of decision making, to redress the high rate at which ALJs were reversing decisions made at state levels, and to redress perceived imbalances between the reversal rates of the various ALJs. Association of Administrative Law Judges, Inc. v. Heckler, 594 F.Supp. 1132, 1134 (D.D.C.1984), citing H.R.Rep. No. 944, 96th Cong., 2d Sess. 57 (1980), reprinted in 1980 U.S. Code Cong. & Ad. News, 1392, 1405, and S.Rep.No. 408, 2d Sess. 53 (1980), reprinted in 1980 U.S. Code Cong. & Ad. News, 1277, 1331.

In implementing the Bellmon Review Program, the Secretary authorized the Office of Hearings and Appeals to target specific ALJs who had high rates of allowing disability benefits. (Memorandum from Louis B. Hayes, Associate Director of the Social Security Administration, Sept. 24, 1982.) Initially, an ALJ would be targeted for review if he or she had a 66 2/3 percent or higher allowance rate. By April 1, 1983, the program was supplemented to allow targeting based on the rate at which the Appeals Council reversed the ALJ. Under both criteria, only ALJs with a high allowance rate formed the pool from which targeted ALJs were selected for review.

When an ALJ was selected for review, all of that judge's decisions were subject to Appeals Council scrutiny. Among other repercussions, the ALJs selected were advised that if, after further review, their performance did not improve, "other steps would be considered." Memorandum of Associate Director, supra.¹

B

Plaintiff, George L. Barry, was employed as a carpenter from 1958 until January 1981, when he suffered a heart attack. He returned to work in August 1981 but suffered chest pains and back pains that prevented him from performing sustained activity throughout the work day. He stopped working on December 28, 1981, and has not been gainfully employed since January 1982.

Plaintiff brought a claim for disability payments under 42 U.S.C. § 423(a)(1)(D). The ALJ granted plaintiff disability benefits, and determined that plaintiff had the residual capacity to perform "sedentary work" as defined by 20 C.F.R. § 404.1567. The Appeals Council, on its own motion and pursuant to the Bellmon Review Program, chose to review the ALJ's decision. On December 6, 1983, the Appeals Council reversed the ALJ and found that plaintiff was not entitled to disability benefits. Specifically, the Council found that plaintiff had the maximum sustained capacity for a full range of medium work activities.

Plaintiff then brought this action pursuant to § 205(g) of the Social Security Act, as amended, 42 U.S.C. § 405(g), to obtain judicial review of the final decision of the Secretary that he did not qualify for disability insurance benefits under Title II of the Social Security Act. Both parties moved for summary judgment. The issue framed by the cross-motions for summary judgment was whether plaintiff was assured due process in the manner in which his application for SSI benefits was reviewed. The Court held that plaintiff was not assured due process, and on April 18, 1985, the Court reversed the Secretary granting summary judgment in favor of plaintiff.

On June 13, 1985, judgment in this action was entered, and on June 25, 1985, the Secretary filed a motion for clarification pursuant to Rule 59(e) of the Federal Rules of Civil Procedure. On August 20, 1985, the Court's clarification order was filed, stating that remand to the Secretary was for the sole purpose of effectuating the payment of social security benefits.

On October 18, 1985, plaintiff filed this motion for an order awarding attorney's fees and costs under the EAJA. 28 U.S.C. § 2412. The Secretary opposed the motion on the grounds that it should be dismissed as untimely and, in any event, that her position was at all times substantially justified, thereby precluding an award under the EAJA.

II

Under federal law, attorney's fees may be awarded against the United States only if such an award is authorized by statute. Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 247, 95 S.Ct. 1612, 1616-17, 44 L.Ed.2d 141 (1975). The EAJA, 28 U.S.C. § 2412, authorizes payment of reasonable attorney's fees and costs when a party prevails in a civil action, other than tort, against the United States. 28 U.S.C. § 2412(d)(1)(A). Hence, the EAJA is applicable to judicial review actions brought under the Social Security Act. Berman v. Schweiker, 713 F.2d 1290, 1295 (7th Cir.1983).

An award of attorney's fees pursuant to the EAJA provides the incentive necessary to enable persons such as plaintiff to pursue benefits they legally deserve. See H.R.Rep. No. 1418, 96th Cong., 2d Sess. 5-6 (1980), reprinted in 1980 U.S. Code Cong. & Ad. News 4953, 4984. Thus, fees and costs will be awarded unless the plaintiff fails to meet the statutory requirements of such an award or the government, which has the burden of proof on the issue, can show that its position throughout the litigation was substantially justified. 28 U.S.C. § 2412(d)(1)(A); Wolverton v. Heckler, 726 F.2d 580 (9th Cir.1984).

Among the statutory requirements for an award of attorney's fees under the EAJA is that the application for such an award must be made within thirty days of "final judgment" in the action. The Secretary argues that because judgment was entered in this action on June 13, 1985, it became a "final judgment" within the meaning of the EAJA when the sixty days to appeal from that judgment expired on August 12, 1985. See 28 U.S.C. § 2412(d)(2)(G) (as added by Public Law 99-80, § 2(c)(2), effective on enactment, August 5, 1985). Thus, plaintiff had thirty days from August 12, 1985, or until September 11, 1985, to file an application for fees and other expenses under the EAJA. Because plaintiff's motion was not filed until October 18, 1985, the Secretary argues that it must be dismissed as untimely within the specific pleading requirements of 28 U.S.C. § 2412(d)(1)(B).

Under the facts of the present case, the Secretary is simply incorrect. By virtue of her June 25, 1985, motion for clarification brought pursuant to Federal Rule of Civil Procedure 59(e), the Secretary caused that the judgment entered on June 13, 1985, not be deemed as the Court's "final judgment" until such time as a clarification was rendered.

The Secretary's motion for clarification in effect tolled the allotted time within which plaintiff would be permitted to seek an award of attorney's fees under the EAJA, as set forth in Federal Rule of Appellate Procedure 4(a)(4), which provides in pertinent part:

If a timely motion under the Federal Rules of Civil Procedure is filed in the district court by any party: * * * (iii) under Rule 59 to alter or amend the judgment * * * the time for appeal for all parties shall run from the entry of the order * * * granting or denying * * * such motion.

Hence, the Secretary's motion for clarification, brought under Rule 59(e) for motions to alter or amend the judgment, set the time for commencement of the sixty-day period in which to appeal the judgment from the date said clarification was rendered. The clarification was not filed until August 20, 1985. Therefore, the judgment became final when the sixty days in which to appeal from that judgment expired on October 19, 1985. Plaintiff had thirty days from that date, or until November 18, 1985, in which to submit an application for attorney's fees under the EAJA. Because plaintiff's motion was filed on October 18, 1985, it need not be dismissed as untimely.

The Secretary also submits that her position in the underlying litigation here was substantially justified, thereby precluding an award of fees and costs under the EAJA. In assessing whether the government's position was substantially justified, the test to be applied is essentially one of reasonableness. Timms v. United States, 742 F.2d 489, 492 (9th Cir.1984); Wolverton, supra. If the government is able to show its case had a reasonable basis in law and in fact, then EAJA fees may not be awarded. Hoang Ha v. Schweiker, 707 F.2d 1104, 1106 (9th Cir.1983).

Given the facts of this case, the Secretary cannot show that her litigation position was reasonable. The question litigated here was not, as is usually the case upon judicial review of a final decision of the Secretary, whether the Secretary's finding was supported by substantial evidence. Here, the question was whether the practice of "targeting" specific ALJs who had high rates of allowing disability benefits impermissibly infringed plaintiff's due process right to receive a hearing before an unbiased judge. Thus, the Secretary's assertion that her position was substantially justified because the decision of the Appeals Council was supported...