Garcia v. Schweiker, s. 83-1786

• Decision Date: 18 August 1987
• Docket Number: Nos. 83-1786,87-1084,s. 83-1786
• Citation: 829 F.2d 396
• Parties: , Unempl.Ins.Rep. CCH 17,570 GARCIA, Emilio, Appellant, v. SCHWEIKER, Richard S., Secretary Department of Health and Human Services. . Submitted Under Third Circuit Rule 12(6)
• Court: U.S. Court of Appeals — Third Circuit

Page 396

829 F.2d 396

19 Soc.Sec.Rep.Ser. 65, Unempl.Ins.Rep. CCH 17,570

GARCIA, Emilio, Appellant, v. SCHWEIKER, Richard S., Secretary Department of Health and Human Services.

Nos. 83-1786, 87-1084.

United States Court of Appeals, Third Circuit.

Submitted Under Third Circuit Rule 12(6)

Aug. 18, 1987.

Decided Sept. 21, 1987.

Edward S.G. Dennis, Jr., U.S. Atty., James G. Sheehan, Asst. U.S. Atty., Chief, Civil Div., E.D. Pa., Beverly Dennis, III, Chief Counsel, Region II, Charlotte Hardnett, Supervisory Asst. Regional Counsel, and Collette A. Pete, Asst. Regional Counsel, Dept. of Health and Human Services, Philadelphia, Pa., for appellee.

Eric J. Fischer, Community Legal Services, Inc., Philadelphia, Pa., for appellant.

Before GIBBONS, Chief Judge, and WEIS and SLOVITER, Circuit Judges.

OPINION OF THE COURT

GIBBONS, Chief Judge:

Emilio Garcia, by his counsel, Community Legal Services, Inc. of Philadelphia (Community Legal Services) applies to this court under the Equal Access to Justice Act, 28 U.S.C. Sec. 2412(d) (Supp. III 1985) (EAJA) for an award of attorneys' fees for the appellate work performed on this case. Appeal No. 83-1786. Community Legal Services also appeals from an order awarding attorneys' fees under the EAJA for work performed in the district court. Appeal No. 87-1084. Garcia, an applicant for disability insurance benefits under the Social Security Act, was initially denied such benefits by the agency and the district court. We vacated and remanded the matter to the Secretary, who again found Garcia not disabled. The matter was presented again to the district court, whereupon Garcia was awarded disability benefits on the basis that he suffered from severe phlebitis and mental impairment.

Thereafter, Community Legal Services filed in the district court for attorneys' fees under the EAJA for 26.75 hours of work performed before that court. The district court found that Garcia was a prevailing party, that the Secretary "had little, if any, support in the record" for denying Garcia's claim and that the agency had failed to establish substantial justification for its position. Accordingly, the district court awarded $75.00 an hour for 26.75 hours of legal services. The district court declined, however, to award an enhanced fee based on special factors or cost of living increases since 1981. We will reverse the judgment on the cost of living claim and affirm on the special factors claim. With respect to Appeal No. 83-1786, we conclude that Community Legal Services is entitled to attorneys' fees under the EAJA for 8.5 hours of appellate work at the rate of $75.00 an hour, adjusted for inflation since the statutory rate was fixed in 1981.

I.

Community Legal Services filed simultaneous fee petitions before the district court and this court for work performed before each respectively. Both petitions raise identical or related issues but request different monetary awards. The Secretary objects to the filing of concurrent petitions, arguing that bifurcated consideration results in protracted and duplicative litigation. ¹ In response, Community Legal Services explains that separate applications were filed in light of Stokes v. Bowen, Civ. No. 82-5124 (E.D.Pa. July 17, 1986). In Stokes, the same district judge as in the present case declined to consider hours expended on the appeal, stating that "[t]he determination as to whether a position taken by the Secretary was justified is best made by the court before which the Secretary took that position." Id., slip op. at 3 (citing Washington v. Heckler, 608 F.Supp. 1286, 1287-89 (E.D.Pa.1985).

We have since reversed, however, and remanded the Stokes case to the district court, directing it to calculate and award attorneys' fees under the EAJA for work performed on the trial and appellate levels. See Stokes v. Bowen, 811 F.2d 814, 817 (3d Cir.1987). In doing so, we repeated the Third Circuit position that " '[w]e perceive no reason why the district court should not set the fees for work in both courts when representation in each was required. That practice reduces the time and effort required of counsel and also simplifies judicial oversight of the process.' " Id. (quoting Guido v. Schweiker, 775 F.2d 107, 110 (3d Cir.1985)). Accord Brinker v. Guiffrida, 798 F.2d 661, 669 (3d Cir.1986).

The present case is a perfect example of the waste of judicial economy which results when petitions are filed separately in different courts. The district court below considered the exact issues raised in the first instance before this court. At one point, two separate motions--the appeal from the district court's decision and the fee petition for appellate work--were pending before this court and were eventually consolidated by this court sua sponte. Clearly, judicial resources could have been saved if both petitions were filed in the district court. Any appeals from the judgment below would have then come up together, thereby insuring uniform appellate consideration. Since we must review the district court decision in connection with the trial hours, however, we will now also entertain the fee petition for appellate hours.

II.

Community Legal Services applies under the EAJA for an award of attorneys' fees for the time it expended on appeal. A prevailing party is entitled to attorneys' fees under the EAJA "unless the court finds that the position of the United States was substantially justified or that special circumstances made an award unjust." 28 U.S.C. Sec. 2412(d)(1)(A). ² Since it is undisputed that Garcia is a prevailing party, the only issue that we must consider in determining if Community Legal Services is entitled to an award for attorneys' fees under the EAJA is whether the government has met its burden of proving substantial justification. See Dougherty v. Lehman, 711 F.2d 555, 562 (3d Cir.1983).

In order to prevail, the government must show: 1) a reasonable basis in truth for the facts alleged; 2) a reasonable basis in law for the theory it propounded; and 3) a reasonable connection between the facts alleged and the legal theory advanced. Washington v. Heckler, 756 F.2d 959, 961 (3d Cir.1985) (citing Citizens Council of Delaware County v. Brinegar, 741 F.2d 584, 593 (3d Cir.1984)). ³

The Secretary contends that its initial decision to deny benefits and to defend that denial was reasonable both in law and fact because there was no record evidence that Garcia suffered from a severe mental impairment, that he was treated for a disabling leg impairment or that Garcia's phlebitis imposed significant functional limitations. The fact of the matter is, however, that the agency's position clearly offended established precedent. Indeed, in considering the appeal from the denial of Garcia's disability benefits, we vacated the district court's judgment affirming the agency determination and remanded to the Secretary because the agency had failed to conform to established precedents. See Garcia v. Heckler, 745 F.2d 46 (3d Cir.1984) (per curiam). ⁴

Moreover, on remand, the Secretary continued to disregard this court's directives. In the final decision on the merits, the district court found, inter alia, that 1) despite the fact that the agency's final administrative decision conceded that Garcia suffered from severe phlebitis, the ALJ continued to conclude that Garcia was not disabled and the Secretary still maintained in the district court that the phlebitis was not severe; 2) despite uncontradicted medical evidence, the ALJ continued to find, without explanation, that Garcia's allegations of severe pain were not credible; 3) the agency failed to consider possible psychological problems for the period prior to December 31, 1978 despite our 1984 mandate and despite uncontested medical testimony to the contrary; and 4) the vocational "grids" continued to be incorrectly applied. See Garcia v. Bowen, No. 83-1453, Bench Opinion dated Dec. 15, 1986.

Clearly, throughout the course of this litigation, the Secretary failed to consider probative medical evidence, rejected several of Garcia's allegations in a conclusory manner or failed to consider them altogether. The lack of certain evidence, which the Secretary maintains justified its position, is of no consequence. The Secretary continuously flouted well-established precedents and thus, its position cannot be considered substantially justified. See Washington v. Heckler, 756 F.2d at 962. Accordingly, we conclude that Community Legal Services is entitled to an award of attorneys' fees under the EAJA for the appellate work performed in this case.

Having determined the entitlement to such fees, we turn now to their calculation. The EAJA provides that:

[A]ttorney fees shall not be awarded in excess of $75 per hour unless the court determines that an increase in the cost of living or a special factor, such as the limited availability of qualified attorneys for the proceedings involved, justifies a higher fee.

28 U.S.C. Sec. 2412(d)(2)(A)(ii).

According to Community Legal Services, an enhanced fee at the market rate ⁵ is warranted here because of the presence of the following "special factors": limited availability of qualified attorneys; the contingent nature of the case; the undesirability of the case; the results obtained and the quality of the representation. Community Legal Services contends that this case was extremely undesirable to private counsel because of the unfavorable decision at the ALJ level, the ALJ's refusal to consider the evidence properly, the prevailing policy of the Appeals Council to rubber stamp ALJ decisions and the lack of certain psychiatric data needed to prove severe psychiatric impairment. In support of this contention, Community Legal Services offers a letter from the original private counsel stating that she withdrew from the case because the risks of proceeding in federal court after losing the administrative appeals were too great. See Letter from Maritza Gonzalez Ortiz dated ...