Labrie v. Secretary of Health and Human Services, 92-1066

• Citation: 976 F.2d 779
• Decision Date: 30 September 1992
• Docket Number: No. 92-1066,92-1066
• Parties: , Unempl.Ins.Rep. (CCH) P 16905A, 3 NDLR P 122 Joseph LABRIE, Plaintiff, Appellant, v. SECRETARY OF HEALTH AND HUMAN SERVICES, Defendant, Appellee.
• Court: United States Courts of Appeals. United States Court of Appeals (1st Circuit)

Page 779

976 F.2d 779

39 Soc.Sec.Rep.Ser. 3, Unempl.Ins.Rep. (CCH) P 16905A,

3 NDLR P 122

Joseph LABRIE, Plaintiff, Appellant, v. SECRETARY OF HEALTH AND HUMAN SERVICES, Defendant, Appellee.

No. 92-1066.

United States Court of Appeals First Circuit.

Submitted June 3, 1992.

Decided Sept. 30, 1992.

Jack Comart and Patrick Ende on brief for plaintiff, appellant.

Richard S. Cohen, U.S. Atty., Stuart M. Gerson, Asst. Atty. Gen., William Kanter and Edward T. Swaine, U.S. Dept. of Justice, on brief for defendant, appellee.

Before BREYER, Chief Judge, CAMPBELL, Senior Circuit Judge, and BOUDIN, Circuit Judge.

PER CURIAM.

This case compels us to enter the fray which has arisen in the wake of Melkonyan v. Sullivan, --- U.S. ----, 111 S.Ct. 2157, 115 L.Ed.2d 78 (1991), concerning the timeliness of attorney's fees applications in so-called "sentence four" Social Security remands. The district court read that decision as creating a "procedural no-man's land"--as mandating that the application here be denied because it was not filed at an earlier time when, under then-prevailing law, it would have been premature. We disagree.

I.

The facts are straightforward. Joseph Labrie (claimant) filed an application for Supplemental Security Income benefits in December 1985. The Administrative Law Judge (ALJ) denied the claim at step five of the sequential evaluation, the Appeals Council denied review, and claimant filed a timely appeal. A magistrate-judge, to whom the case was referred, determined that the Secretary's decision was unsupported by substantial evidence. In particular, he found that the Secretary failed adequately to consider claimant's subjective complaints of pain. The magistrate-judge recommended that the case be remanded for further proceedings. On January 9, 1990, neither party having filed an objection, the district court entered an order adopting the magistrate-judge's report and recommendation, vacating the Secretary's decision, and remanding for further agency action.

On remand, the ALJ conducted a new hearing and, on September 17, 1991, issued a decision awarding benefits to claimant. Following the prevailing practice, claimant then submitted to the district court, on October 22, 1991, a proposed final order and application for attorney's fees under the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412(d). Among the prerequisites to an EAJA award is that the party file an application "within thirty days of final judgment in the action." Id. § 2412(d)(1)(B). Relying on Melkonyan, the district court determined that its January 9, 1990 remand order constituted the final judgment, such that claimant's application needed to have been filed within ninety days of that date. ¹ The application was thus denied, on November 5, 1991, as being over eighteen months late. Claimant thereafter filed motions for relief under Fed.R.Civ.P. 59(e) and 60(b), which were denied on January 3, 1992. The district court acknowledged that its ruling "may be perceived as an unfair result," ² but considered such an outcome mandated by the intervening Melkonyan decision. This appeal followed.

II.

A trio of Supreme Court decisions involving claims for disability benefits informs the analysis here. In Sullivan v. Hudson, 490 U.S. 877, 109 S.Ct. 2248, 104 L.Ed.2d 941 (1989), the Court determined that an EAJA fee award could encompass work performed before the agency on remand. Specifically, it found that such agency proceedings may be so "intimately connected" to the judicial proceedings as to be considered part of the "civil action" ³ for which EAJA fees were available. Id. at 892, 109 S.Ct. at 2257. In reaching this conclusion, the Court first took note of the "somewhat unusual" judicial review provisions in 42 U.S.C. § 405(g):

The detailed provisions for the transfer of proceedings from the courts to the Secretary and for the filing of the Secretary's subsequent findings with the court suggest a degree of direct interaction between a federal court and an administrative agency alien to traditional review of agency action under the Administrative Procedure Act.

490 U.S. at 885, 109 S.Ct. at 2254. ⁴ It then emphasized three points. First, "[i]n many remand situations, the court will retain jurisdiction over the action pending the Secretary's decision and its filing with the court." Id. at 886, 109 S.Ct. at 2254. ⁵ Second, where a remand for further proceedings does not dictate the receipt of benefits, "the claimant will not normally attain 'prevailing party' status ... until after the result of the administrative proceedings is known." Id. And third, referring to EAJA's requirement that an application be filed within thirty days of "final judgment," it noted that "[a]s in this case, there will often be no final judgment in a claimant's civil action for judicial review until the administrative proceedings on remand are complete." Id. at 887, 109 S.Ct. at 2255. The Court concluded that EAJA fees for representation on remand were available "where a court orders a remand ... and retains continuing jurisdiction over the case pending a decision from the Secretary which will determine the claimant's entitlement to benefits." Id. at 892, 109 S.Ct. at 2258.

The following term, Sullivan v. Finkelstein, 496 U.S. 617, 110 S.Ct. 2658, 110 L.Ed.2d 563 (1990), was decided. At issue there was whether a remand order was immediately appealable as a "final decision" under 28 U.S.C. § 1291; EAJA was not involved. An agency regulation provided that a surviving spouse (unlike a wage earner) was disabled only if he or she suffered from an impairment meeting the Secretary's Listing of Impairments; age, education and work experience were not to be considered. The district court effectively invalidated this regulation. It found that the claimant did not have a listed impairment, but nonetheless remanded because of suggestions that claimant was unable to engage in any gainful activity. The Secretary sought to take an immediate appeal; the appellate court dismissed for lack of jurisdiction.

In finding the remand order to be an appealable final decision, the Court distinguished between remands ordered pursuant to sentence four of 42 U.S.C. § 405(g) and those pursuant to sentence six. Claimant argued that § 405(g), in sentence seven, contemplated an appealable final judgment to be entered by the district court following the remand proceedings. Yet the post-remand review called for under sentence seven, the Court held, referred only to cases that had been remanded under sentence six. And a sentence six remand was only "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." 496 U.S. at 626, 110 S.Ct. at 2664. Rather, the district court's order was a sentence four remand--"a judgment ... reversing the decision of the Secretary, with ... remanding the cause for a rehearing." Id. at 625, 110 S.Ct. at 2663-64 (quoting statute). The order was "unquestionably" a judgment: "it terminated the civil action challenging the Secretary's final determination that respondent was not entitled to benefits, set aside that determination, and finally decided that the Secretary could not follow his own regulations in considering the disability issue." Id. And "the fourth sentence directs the entry of a final, appealable judgment even though that judgment may be accompanied by a remand order." Id. at 629, 110 S.Ct. at 2666. Hudson, despite containing "language ... supporting" claimant's position, id. at 630, 110 S.Ct. at 2666, was distinguishable: the concern there was with the interpretation of the term "any civil action" in the EAJA, not with the appealability of a remand order under § 1291. Id. at 630, 110 S.Ct. at 2666. The Court did reiterate its conclusions in Hudson that the agency proceedings on remand should be considered part of the civil action for EAJA fee purposes, and that a claimant would not normally attain "prevailing party" status until the result of the remand proceedings was known. Id.

In Melkonyan, the issue was what event constituted a "final judgment" for EAJA purposes, triggering the jurisdictional thirty-day filing period. Before the district court, the Secretary had requested a remand for consideration of new evidence; claimant eventually acceded to this request, and the court remanded "for all further proceedings." Claimant was awarded benefits on remand, and neither party thereafter returned to district court for entry of final judgment. Over a year later, claimant applied for EAJA fees. The Ninth Circuit deemed the application untimely, ruling that the Appeals Council's decision to award benefits constituted the EAJA final judgment.

In its June 10, 1991 decision, the Supreme Court rejected this view. Congress' use of the term "judgment" in EAJA, it held, "refers to judgments entered by a court of law and does not encompass decisions rendered by an administrative agency." --- U.S. ----, 111 S.Ct. at 2162. In reaching this conclusion, the Court again distinguished Hudson, indicating that that decision encompassed the "narrow class" of cases "where the district court retains jurisdiction of the civil action and contemplates entering a final judgment following the completion of administrative proceedings." Id. As neither party had returned to the district court for entry of final judgment, the question then became whether either was entitled to do so. "The answer depends on what kind of remand the District Court contemplated." Id. --- U.S. at ----, 111 S.Ct. at 2163. The choices were only two, for the Court made clear that the sentence four and sentence six remands identified in Finkelstein were the "only kinds of remands permitted under the statute." Id. --- U.S. at ----, 111 S.Ct. at 2164. "[R]emand orders must either accompany a final judgment affirming, modifying, or reversing the administrative...