Gutierrez v. Sullivan

• Decision Date: 02 January 1992
• Docket Number: 91-4009,Nos. 90-4198,s. 90-4198
• Parties: , Unempl.Ins.Rep. (CCH) P 16397A, 2 NDLR P 189 Joey V. GUTIERREZ, Plaintiff-Appellant/Cross-Appellee, v. Louis W. SULLIVAN, M.D., Secretary of Health and Human Services, Defendant-Appellee/Cross-Appellant.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 579

953 F.2d 579

36 Soc.Sec.Rep.Ser. 129, Unempl.Ins.Rep. (CCH) P 16397A,

2 NDLR P 189

Joey V. GUTIERREZ, Plaintiff-Appellant/Cross-Appellee, v. Louis W. SULLIVAN, M.D., Secretary of Health and Human

Services, Defendant-Appellee/Cross-Appellant.

Nos. 90-4198, 91-4009.

United States Court of Appeals, Tenth Circuit.

Jan. 2, 1992.

Rehearing Denied April 30, 1992.

Maureen L. Cleary, Salt Lake City, Utah, for plaintiff-appellant/cross-appellee.

Stuart M. Gerson, Asst. Atty. Gen., Washington, D.C., Dee Benson, U.S. Atty., Salt Lake City, Utah, and Deana R. Ertl-Lombardi, Sp. Atty. to the U.S. Atty. Gen., Denver, Colo. (Ronald S. Luedemann and Thomas A. Nelson, Jr., Office of the Gen. Counsel, Dept. of Health and Human Services, of counsel), for defendant-appellee/cross-appellant.

Before McKAY, Chief Judge, EBEL, Circuit Judge, and SAFFELS, ^* District Judge.

SAFFELS, District Judge.

After examining the briefs and appellate record, this panel has determined unanimously that oral argument would not materially assist the determination of this appeal. See Fed.R.App.P. 34(a); 10th Cir.R. 34.1.9. The case is therefore ordered submitted without oral argument.

Plaintiff Joey Gutierrez appeals the district court's Order of September 25, 1990, denying his request for attorney's fees under the Equal Access to Justice Act, 28 U.S.C. § 2412 (EAJA). Gutierrez v. Sullivan, 745 F.Supp. 665 (D.Utah 1990). Defendant Secretary of Health and Human Services cross-appeals the district court's Order of April 18, 1990, rejecting the Secretary's argument that Plaintiff's motion for attorney's fees was untimely. Gutierrez v. Sullivan, 734 F.Supp. 969 (D.Utah 1990). Because the Secretary's cross-appeal raises a jurisdictional issue, we must address it first.

I.

Plaintiff applied for and was denied social security benefits at the administrative level. He then commenced an action in district court seeking review of the Secretary's denial of benefits. Upon review, the district court concluded that the Secretary had failed to consider evidence relating to Plaintiff's mental impairment and had either misunderstood or misapplied an evaluation made by Dr. Ghicadus, a psychiatrist. The district court remanded the case to the Secretary for further review, by Order dated January 30, 1989.

After further agency proceedings, an ALJ recommended that the Secretary award Plaintiff benefits. The Appeals Council adopted this recommendation, which became the final decision of the Secretary, on May 8, 1989. On December 12, 1989, Plaintiff filed a Motion for Entry of Final Judgment and Award of Attorney's Fees Under the Equal Access to Justice Act. The Secretary objected to Plaintiff's Motion, arguing that the final decision of the Secretary on May 8, 1989, constituted final judgment in the action, so Plaintiff's application for fees was untimely. A request for attorney's fees under the EAJA must be filed with the court "within thirty days of final judgment in the action." 28 U.S.C. § 2412(d)(1)(B).

The district court rejected the Secretary's argument, and ruled that "final judgment" for purposes of the EAJA meant a final order by a court, not a final decision by an agency. Gutierrez, 734 F.Supp. at 971. The court further ruled that "[a]t present, this court is unable to enter final judgment because the Secretary has yet to file any modified findings of fact and decision with the court as required by 42 U.S.C. § 405(g)." Id. at 969. Thereafter, the Secretary filed with the court a copy of his final decision awarding Plaintiff benefits and moved for entry of final judgment. The district court entered an Order for Entry of Final Judgment on May 8, 1990, and Plaintiff renewed his motion for attorney fees under the EAJA on June 4, 1990. The district court denied the request for fees on the ground that the Secretary's position was substantially justified. Gutierrez, 745 F.Supp. at 668.

While these appeals were pending, the Supreme Court issued an opinion addressing "whether an administrative decision rendered following a remand from the District Court is a 'final judgment' within the meaning of EAJA." Melkonyan v. Sullivan, --- U.S. ----, 111 S.Ct. 2157, 2159, 115 L.Ed.2d 78 (1991). The Court rejected the same argument advanced by the Secretary here, and concluded that "a 'final judgment' for purposes of 28 U.S.C. § 2412(d)(1)(B) means a judgment rendered by a court that terminates the civil action for which EAJA fees may be received. The 30-day EAJA clock begins to run after the time to appeal that 'final judgment' has expired." Id. 111 S.Ct. at 2162.

The Court went on to discuss whether the district court had entered a final judgment in the case and, if not, whether either party was entitled to return to the district court for entry of a final judgment. Id. at 2162-63. The Court determined that "[t]he answer depends on what kind of remand the District Court contemplated." Id. at 2163.

Based on its rulings in Sullivan v. Finkelstein, 496 U.S. 617, 110 S.Ct. 2658, 110 L.Ed.2d 563 (1990), the Court held that only two types of remands are available under the Social Security Act. Melkonyan, 111 S.Ct. at 2164. The first type is under the fourth sentence of 42 U.S.C. § 405(g), which provides: "The court shall have power to enter, upon the pleadings and transcript of the record, a judgment affirming, modifying, or reversing the decision of the Secretary, with or without remanding the cause for a rehearing." Melkonyan, 111 S.Ct. at 2164. The second type is under the sixth sentence, which provides:

The court may, on motion of the Secretary made for good cause shown before he files his answer, remand the case to the Secretary for further action by the Secretary, and it may at any time order additional evidence to be taken before the Secretary, but only upon a showing that there is new evidence which is material and that there is good cause for the failure to incorporate such evidence into the record in a prior proceeding; and the Secretary shall, after the case is remanded, and after hearing such additional evidence if so ordered, modify or affirm his findings of fact or his decision, or both, and shall file with the court any such additional and modified findings of fact and decision, and a transcript of the additional record and testimony upon which his action in modifying or affirming was based.

42 U.S.C. § 405(g); Melkonyan, 111 S.Ct. at 2164.

Dividing remand orders into two categories, the Court concluded, "harmonizes the remand provisions of § 405(g) with the EAJA requirement that a 'final judgment' be entered in the civil action in order to trigger the EAJA filing period." Melkonyan, 111 S.Ct. at 2165.

In sentence four cases, the filing period begins after the final judgment ("affirming, modifying, or reversing") is entered by the court and the appeal period has run, so that the judgment is no longer appealable. See [28 U.S.C.] § 2412(d)(2)(G). In sentence six cases, the filing period does not begin until after the postremand proceedings are completed, the Secretary returns to court, the court enters a final judgment, and the appeal period runs.

Id. at 2165.

The district court in Melkonyan had remanded the action to the Secretary on the Secretary's motion for reconsideration in light of new evidence without deciding the merits of the pending motions for summary judgment. Id. at 2160, 2163. The district court, however, had not made a finding of good cause for the remand. Id. at 2165. Because the district court's order did not exactly meet the requirements of the sixth sentence of section 405(g), the Court was uncertain whether the district court intended to enter a sixth sentence remand or do something else, such as dismiss the case under Fed.R.Civ.P. 41(a). Melkonyan, 111 S.Ct. at 2165. The Court, therefore, vacated the decision of the appellate court and remanded the action with directions to remand the case to the district court to clarify its order. Id. at 2165, 2166.

Both parties here had an opportunity to submit briefs addressing the effect of Melkonyan on the issues presented by the Secretary's cross-appeal. The Secretary argues in his brief that Plaintiff's application for fees was untimely because the district court's remand order of January 30, 1989, was entered pursuant to the fourth sentence of 42 U.S.C. § 405(g) and constituted a final judgment within the meaning of the EAJA. Thus, under the Secretary's theory, the time for filing an application for fees ended on April 30, 1989, at the expiration of the 60-day appeal period in Fed.R.App.P. 4(a) plus the 30-day limitations period in 28 U.S.C. § 2412(d)(1)(B). Plaintiff, on the other hand, argues that his application for fees was timely because the district court's remand was made pursuant to the sixth sentence of 42 U.S.C. § 405(g). Therefore, the district court did not enter final judgment until May 8, 1990, after the Secretary returned to the district court and filed his amended findings and decision.

We reject Plaintiff's contention that the district court's Order constituted a sixth sentence remand. The sixth sentence of section 405(g) does not contemplate a remand for the purpose of hearing additional evidence or making additional findings of fact when the district court has found that the Secretary's position is not supported by substantial evidence or that the Secretary applied the wrong legal standards. Rather, "[t]he sixth sentence of § 405(g) plainly describes an entirely different kind of remand, appropriate when the district court learns of evidence not in existence or available to the claimant at the time of the administrative proceeding that might have changed the outcome of that proceeding." Finkelstein, 110 S.Ct. at 2664.

On the other hand, we do not accept the Secretary's assertion that the district court's remand order necessarily constituted a final judgment within the meaning of the EAJA. The district court apparently intended to retain jurisdiction over...