Halverson v. Slater

• Decision Date: 31 March 2000
• Docket Number: No. 99-5115,99-5115
• Citation: 206 F.3d 1205
• Parties: (D.C. Cir. 2000) Paul D. Halverson, et al.,Appellants v. Rodney E. Slater, Secretary, United States Department of Transportation, Appellee
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 1205

206 F.3d 1205 (D.C. Cir. 2000)

Paul D. Halverson, et al.,Appellants v. Rodney E. Slater, Secretary, United States Department of Transportation, Appellee

No. 99-5115

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 23, 2000

Decided March 31, 2000

Appeal from the United States District Court for the District of Columbia(No. 96cv00028)

John Longstreth argued the cause for appellants. With him on the briefs were Donald A. Kaplan and Mark Ruge.

Rudolph Contreras, Assistant U.S. Attorney, argued the cause for appellee. With him on the brief were Wilma A. Lewis, U.S. Attorney, R. Craig Lawrence, Assistant U.S. Attorney, and Dale C. Andrews, Deputy Assistant General Counsel for Litigation, U.S. Department of Transportation.

Before: Edwards, Chief Judge, Tatel and Garland, Circuit Judges.

Opinion for the Court filed by Circuit Judge Tatel.

Tatel, Circuit Judge:

After a previous panel of this court invalidated a final rule issued by the Department of Transportation, the prevailing parties, appellants herein, filed an application for attorneys' fees and costs pursuant to the Equal Access to Justice Act. The district court denied the application, finding the Department's defense of the rule, though unsuccessful, "substantially justified" within the meaning of the Act. Because the district court failed adequately to explain its decision, and because we find unpersuasive the Department's argument that its position was substantially justified, we grant appellants' application for fees and expenses and remand for the district court to calculate the precise amount due.

I

The Great Lakes Pilotage Act of 1960, 46 U.S.C. SS 9301 et seq., requires that foreign ships traveling the Great Lakes take on an experienced American or Canadian pilot. Id. S 9302(a). The Act directs the Secretary of Transportation to set standards for pilot qualifications, selection, registration, training, and working conditions. Id. S 9303.

Until 1995, the Secretary had delegated Pilotage Act responsibilities to the United States Coast Guard as permitted by 46 U.S.C. S 2104(a): "The Secretary may delegate the duties and powers conferred by this subtitle [Subtitle II, titled 'Vessels and Seamen'] to any officer, employee, or member of the Coast Guard, and may provide for the subdelegation of those duties and powers." Pilotage Act responsibilities are among the Secretary's Subtitle II duties. Pursuant to a final rule issued on December 11, 1995, the Secretary transferred certain Great Lakes pilot responsibilities from the Coast Guard to the St Lawrence Seaway Development Corporation. Organization and Delegation of Powers and Duties; Transfer of Great Lakes Pilotage Authority From the Coast Guard to the Saint Lawrence Seaway Development Corporation, 60 Fed. Reg. 63,444 (Dec. 11, 1995). In support of this transfer, the Secretary invoked his general delegation authority under 49 U.S.C. S 322(b): "The Secretary may delegate, and authorize successive delegations of, duties and powers of the Secretary to an officer or employee of the Department."

Troubled by the safety implications of the transfer, appellants, two Great Lakes pilots and two associations of Great Lakes pilots, filed suit in the United States District Court for the District of Columbia claiming that the delegation exceeded the Secretary's authority under section 2104(a). According to the Pilots, that provision permits the Secretary to transfer Pilotage Act responsibilities only to the Coast Guard, not to the St. Lawrence Seaway Development Corporation.The Department responded that section 2104(a) does not limit the Secretary's general authority to delegate responsibilities pursuant to section 322(b). Granting summary judgment for the Department, the district court found section 2104(a) "fully consistent with [section 322(b)'s] broader language." Halverson v. Pena, 1996 WL 217885, *6 (D.D.C. 1996).

This court reversed. Halverson v. Slater, 129 F.3d 180 (D.C. Cir. 1997). Applying step one of the Chevron framework, see Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 842 (1984), the panel "conclude[d] that the plain meaning of section 2104(a) limits delegation of [Pilotage Act] functions to the United States Coast Guard and that section 322(b) cannot fairly be construed to expand the limitation." 129 F.3d at 181. The panel found that the Secretary's interpretation of section 2104(a) violated three separate canons of construction: it "plainly violates the familiar doctrine that the Congress cannot be presumed to do a futile thing," id. at 185; it "runs afoul of the cardinal canon of statutory construction that '[w]e must read the statutes to give effect to each if we can do so while preserving their sense and purpose,' " id. (quoting Watt v. Alaska, 451 U.S. 259, 267 (1981)); and it is "irreconcilable with the statutory construction principle, expressio unius est exclusio alterius, that is, the 'mention of one thing implies the exclusion of another thing,' " 129 F.3d at 185 (quoting Ethyl Corp. v. EPA, 51 F.3d 1053, 1061 (D.C. Cir. 1995)). The Secretary's assertion that section 2104(a) has wartime significance, the panel said, was "patently erroneous." 129 F.3d at 185. Concluding that "even if section 322(b)'s scope is ambiguous, requiring recourse to Chevron step two, we would be compelled to reject the Secretary's interpretation as unreasonable because it 'would deprive [section 2104(a)] of virtually all effect,' " the panel remanded to the district court with instructions to vacate the final rule. Id. at 189 (quoting American Fed'n of Gov't Employees v. FLRA, 798 F.2d 1525, 1528 (D.C. Cir. 1986)) (alternation in original).

The Pilots then applied for attorneys' fees and expenses under the Equal Access to Justice Act, 28 U.S.C. § 2412(d).The EAJA provides 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 (other than cases sounding in tort), including proceedings for judicial review of agency 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 Secretary neither contested the Pilots' status as prevailing parties nor claimed the existence of "special circumstances." Instead, the Secretary argued that his interpretation of section 322(b) as authorizing the delegation of Pilotage Act responsibilities to the St. Lawrence Seaway Development Corporation was "substantially justified." The district court agreed. Describing the issue as a "straightforward, almost textbook, administrative law problem that was resolved by using well-established general principles of statutory interpretation," it denied the Pilots' EAJA application. Halverson v. Slater, No. 96-0028, Mem. Op. at 9 (D.D.C. Apr. 6, 1999). The Pilots now appeal.

II

Standards for resolving EAJA fee applications have emerged from a growing body of case law. The Government has the burden of proving that its position, including both the underlying agency action and the arguments defending that action in court, was "substantially justified" within the meaning of the Act. See Wilkett v. ICC, 844 F.2d 867, 871 (D.C. Cir. 1988). "Substantially justified" means "justified in substance or in the main--that is, justified to a degree that could satisfy a reasonable person. That is no different from ... [having] a reasonable basis both in law and fact." Pierce v. Underwood, 487 U.S. 552, 565 (1988) (internal quotation marks and citation omitted). While a court's "merits reasoning may be quite relevant to the resolution of the substantial justification question," we have cautioned that "[t]he inquiry into the reasonableness of the Government's position ... may not be collapsed into our antecedent evaluation of the merits, for the EAJA sets forth a distinct legal standard." F.J. Vollmer Co., Inc. v. Magaw, 102 F.3d 591, 595 (D.C. Cir. 1996) (internal quotation marks omitted). For example, "because 'unreasonable' may have different meanings in different contexts, even the presence of that term or one of its synonyms in the merits decision does not necessarily suggest that the Government will have a difficult time establishing that its position was substantially justified." Id. "The relevance of a court's reasoning on the merits to the reasonableness inquiry under the Equal Access Act thus depends on the nature of the case." Id.

Appellate courts review district court EAJA decisions for abuse of discretion. See Pierce, 487 U.S. at 563. Giving substantial deference to the district court, we will reverse if we have "a definite and firm conviction that the court below committed a clear error of judgment in the conclusion it reached upon a weighing of the relevant factors." Vollmer, 102 F.3d at 596 (internal quotation marks and citations omitted). In exercising our appellate responsibility, we recognize the awkward position in which the EAJA sometimes places our district court colleagues. Where, as here, the district court originally accepts the Government's position and is then reversed on appeal, the EAJA requires the district court to determine whether the very Government argument it previously accepted was not substantially justified, i.e., unreasonable. Yet district courts have awarded fees just in such delicate circumstances. See, e.g., Kooritzky v. Herman, 6 F. Supp.2d 1, 4 (D.D.C. 1997), rev'd in part on other grounds, 178 F.3d 1315 (D.C. Cir. 1999).

With these considerations in mind, we turn first to an examination of the reasons the district court gave in support of its finding that the Department's position at the agency level was substantially justified. The district court attributed great significance to the Department's reasons for transferring Pilotage Act functions to the St. Lawrence...