Edwards ex rel. Edwards v. Barnhart

• Decision Date: 06 January 2003
• Docket Number: No. 91 Civ. 1482(LBS).,91 Civ. 1482(LBS).
• Citation: 238 F.Supp.2d 645
• Court: U.S. District Court — Southern District of New York
• Parties: Mary EDWARDS o/b/o Leslie EDWARDS, Plaintiff, v. Jo Anne B. BARNHART, Commissioner of Social Security, Defendant.

238 F.Supp.2d 645

Mary EDWARDS o/b/o Leslie EDWARDS, Plaintiff, v. Jo Anne B. BARNHART, Commissioner of Social Security, Defendant.

No. 91 Civ. 1482(LBS).

United States District Court, S.D. New York.

January 6, 2003.

Irwin M. Portnoy, Irwin M. Portnoy and Associates, P.C., Newburgh, NY, for Plaintiff.

James B. Comey, United States Attorney for the Southern District of New York, By: Lorraine S. Novinski, Assistant United States Attorney, New York, NY, for Defendant.

OPINION AND ORDER

SAND, District Judge.

This application for attorney's fees follows over a quarter century of efforts to obtain social security disability benefits on behalf of Leslie Edwards ("Edwards" or "Plaintiff"), a significant portion of which postdates the death of Mr. Edwards himself.¹ Although Edwards did eventually obtain a portion of the benefits he sought, the Court denies the fee application.

I. Background

The Court refers those seeking greater familiarity with the factual and procedural history of Edwards's benefit applications to the Report and Recommendation of Magistrate Judge Pitman, adopted in part on August 8, 2002. Nonetheless, because the Report and Recommendation was not published, and in view of the tortured history of this case (or, perhaps more appropriately, these cases), a summary of this history is set forth here.

Leslie Edwards applied for disability benefits on December 27, 1977, claiming that he had been disabled since December 31, 1976. His claim was denied both initially and at the reconsideration stage, and he did not seek further review before an Administrative Law Judge ("ALJ"). Over ten years later, on December 12, 1988, Edwards filed a second benefit application on the basis of the same disability. Again the claim was denied, and although Edwards pursued the decision at the ALJ and Appeals Council stages, he failed to win any benefits. Sometime in early 1991, Edwards retained attorney Carol Goldstein to pursue his claim in this Court under 42 U.S.C. § 405(g). Before the Social Security Administration ("SSA") answered the complaint, however, the parties jointly stipulated to a remand.² In a "Stipulation and Order of Remand" signed by both parties and filed on June 4, 1991, this Court ordered:

It is hereby stipulated and agreed, by and between the attorneys for the defendant and the plaintiff, that this action be and hereby is remanded to the [SSA] pursuant to 42 U.S.C. § 405(g), for further administrative proceedings.

In an "Order of Discontinuance" filed the next day, the Court further ordered:

The Court having endorsed a stipulation by the parties remanding this matter to the [SSA], the case is hereby closed in this Court, without prejudice to reopening following completion of the administrative proceedings. If such reopening is required, all filing fees are waived.

The Court did not specify any particular source of authority for its remand other than "§ 405(g)."

Several critical and overlapping events followed. First, on September 1, 1991, Edwards retained a new attorney, Irwin Portnoy. Second, on remand the SSA again denied Edwards any benefits; the Appeals Council denied review on July 14, 1994. Third, on January 2, 1993, Leslie Edwards died. Fourth, on March 8, 1993, Edwards received a letter from the SSA informing him that he might be entitled to benefits as a member of the class covered by the settlement in Stieberger v. Sullivan, 801 F.Supp. 1079 (S.D.N.Y.1992) (Sand, J.), and Portnoy returned the attached notice requesting Stieberger review on Edwards's behalf.

Following the denial of benefits, Portnoy filed several motions in this Court, seeking, inter alia, to reopen the case, to amend the complaint to challenge the latest SSA decision, and to substitute as plaintiff Edwards's wife Mary. These motions were eventually granted without opposition on November 7, 1994. Having returned to this Court, the defendant SSA then moved to remand the case again, this time for the consideration of new evidence that Edwards had received substantial earnings in 1989, 1990, and 1991. On November 30, 1995, the Court granted the motion and remanded the case pursuant to sentence six of § 405(g).

Edwards's case resumed its unusual path through administrative adjudication as two subsequent ALJ determinations that he was not entitled to benefits were vacated by the Appeals Council (once in 1997 because the ALJ had not sufficiently considered certain evidence, and once in 1998 because the audiotape of the hearing was inaudible). Before a third scheduled hearing could take place, Edwards received notice on May 24, 1999, that his application for benefits had been reconsidered under Stieberger, and that he would receive benefits covering the period from December 1987 through January 1993. Because these benefits were the maximum allowable under the 1988 application (commencing one year before the filing of the application and terminating with Edwards's death), the SSA canceled the pending hearing and determined that no further review was necessary. Adopting in large part the Report and Recommendation of Magistrate Judge Pitman, this Court rejected Edwards's subsequent motion to reopen the case.³ On June 11, 1999, Goldstein filed a fee application on her own behalf which the SSA settled for $1250. Portnoy filed the instant fee application on September 6, 2002.⁴

II. The Equal Access to Justice Act

The Equal Access to Justice Act ("EAJA") provides in pertinent part that:

[A] court shall award to a prevailing party other than the United States fees and other expenses ... incurred by that party in any civil action ... brought by or against the United States . . ., unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.

28 U.S.C. § 2412(d)(1)(A).

The EAJA was enacted in response to Congress's concern "that persons may be deterred from seeking review of, or defending against, unreasonable government action because of the expense involved in securing the vindication of their rights." Sullivan v. Hudson, 490 U.S. 877, 883, 109 S.Ct. 2248, 104 L.Ed.2d 941 (1989) (internal quotation marks omitted). The EAJA applies to actions brought under § 405(g) for judicial review of the denial of social security benefits by the SSA. See id. at 883-84, 109 S.Ct. 2248.

The dispute in this case centers not on whether the SSA's position was "substantially justified," but rather on the EAJA's requirement that the fee claimant be the "prevailing party." The question whether Edwards has prevailed within the meaning of the EAJA plunges the Court into a pair of jurisprudential thickets, each of which shall be explored in turn.

III. Sentence Four and Sentence Six of § 405(g)

The parties first dispute whether the initial remand in this case was pursuant to sentence four or sentence six of § 405(g), a fact with significant implications for prevailing-party status. Generally speaking, a sentence four remand accompanies a judgment that terminates the district court's jurisdiction with a substantive ruling "affirming, modifying, or reversing" the SSA's decision. 42 U.S.C. § 405(g).⁵ Today it is clear that by obtaining a sentence four remand a claimant immediately prevails whether or not he ultimately obtains benefits, and he may recover attorney's fees for the judicial proceeding in which he prevailed; any further SSA decisions must be challenged in a new and distinct lawsuit. See Shalala v. Schaefer, 509 U.S. 292, 299-302, 113 S.Ct. 2625, 125 L.Ed.2d 239 (1993). By contrast, a sentence six remand may be ordered for good cause either on the motion of the SSA before answering the complaint, or where there is new material evidence. See 42 U.S.C. § 405(g). Upon a sentence six remand the district court maintains jurisdiction over the subsequent administrative proceedings, placing the claimant in a higher-risk situation: if he ultimately obtains benefits, he is eligible for fees covering his attorney's work at both the district court and administrative level; if he does not ultimately obtain benefits, he never prevails and cannot recover any fees. Whatever the result of the post-remand proceedings, "a sentence-six remand works like a yo-yo; once the record has been enlarged, the district court finally decides whether the administrative decision is tenable." Perlman v. Swiss Bank Corp. Comprehensive Disability Prot. Plan, 195 F.3d 975, 978 (7th Cir.1999). Perhaps most crucially, the Supreme Court has now made clear that sentence four and sentence six are the only valid sources of authority for district court remands in § 405(g) social security cases. See generally Schaefer, 509 U.S. at 299-300 & nn. 3-4, 113 S.Ct. 2625; Raitport v. Callahan, 183 F.3d 101, 103-104 (2d Cir.1999); Medina v. Apfel, 2001 WL 1488284, **3-4, 2001 U.S. Dist. LEXIS 19110, *10-*12 (S.D.N.Y. Nov. 21, 2001).

In the Spring of 1991, however, this legal landscape was far from fully formed and the Court entered its remand order without categorizing it under sentence four or sentence six. Because of the implications that stem from these labels, the Court is now asked to journey through a "time warp,"⁶ and deduce retrospectively whether its remand was pursuant to sentence four or sentence six-a task akin to determining whether Julius Caesar was a Republican or a Democrat. Although the Court ultimately finds that it is unnecessary to categorize its 1991 remand, the factors and caselaw involved bear on other aspects of this case as well, and are thus worth reviewing in some depth.

Until 1991, the rule in this Circuit and elsewhere was that, "generally speaking, a social security claimant prevails when it is determined that she is entitled to benefits." McGill v. Sec'y of Health & Human Servs., 712 F.2d 28, 31-32 (2d Cir.1983) (citations omitted). A version of this rule was announced by the Supreme Court in 1989 in Sullivan v. Hudson:

[W]here a court's remand to the [SSA] for further...