Parker v. Barnhart

• Decision Date: 06 December 2001
• Docket Number: No. C 01-3044-MWB.,C 01-3044-MWB.
• Citation: 174 F.Supp.2d 920
• Court: U.S. District Court — Northern District of Iowa
• Parties: Blake PARKER, on his own behalf and on behalf of all others similarly situated, and National Organization of Social Security Claimants Representatives (NOSSCR), Plaintiffs, v. Jo Anne B. BARNHART,<SMALL><SUP>1</SUP></SMALL> Commissioner of Social Security, and David M. Walker, Comptroller General of the United States, Defendants.

174 F.Supp.2d 920

Blake PARKER, on his own behalf and on behalf of all others similarly situated, and National Organization of Social Security Claimants Representatives (NOSSCR), Plaintiffs, v. Jo Anne B. BARNHART,¹ Commissioner of Social Security, and David M. Walker, Comptroller General of the United States, Defendants.

No. C 01-3044-MWB.

United States District Court, N.D. Iowa, Central Division.

December 6, 2001.

Thomas A. Krause, Max Schott & Associates, PC, Des Moines, IA, Roxanne Barton Conlin, Roxanne Conlin & Associates, Des Moines, IA, for plaintiffs.

Martha A. Fagg, U.S. Attorney's Office, Sioux City, IA, Richard G. Lepley, U.S. Department of Justice, Washington, DC, Peter Robbins, U.S. Department of Justice, Washington, DC, for defendants.

MEMORANDUM OPINION AND ORDER REGARDING DEFENDANTS' MOTION FOR SUMMARY JUDGMENT AND JUDGMENT ON THE PLEADINGS; PLAINTIFFS' MOTION TO STRIKE; AND PLAINTIFFS' MOTION FOR PARTIAL SUMMARY JUDGMENT

BENNETT, Chief Judge.

                TABLE OF CONTENTS
                I. INTRODUCTION .................................................................. 923
                    A. Factual Background ......................................................... 923
                       1. Statutory framework ..................................................... 923
                       2. "Ticket to Work Act" amendments ......................................... 923
                          a.  Authorization of a "user fee" ....................................... 923
                          b.  Mandate for a GAO study ............................................. 925
                       3. Announcement of the 2001 "user fee" ..................................... 925
                       4. The GAO Report .......................................................... 926
                    B. Procedural Background ...................................................... 927
                       1.  The Complaint .......................................................... 927
                       2.  The parties' motions ................................................... 928
                           a.  The defendants' motion for summary judgment and judgment
                                 on the pleadings ....................................................... 928
                           b.  The plaintiffs' motion to strike ................................... 929
                           c.  The plaintiffs' cross-motion for partial summary judgment .......... 929
                 II. LEGAL ANALYSIS ............................................................... 930
                     A. Standards For Summary Judgment ............................................ 930
                        1.  Requirements of Rule 56 ............................................... 931
                        2.  The parties' burdens .................................................. 931
                     B. The Crux Of The Matter .................................................... 932
                     C. The "Takings Claim" ....................................................... 934
                        1.  Arguments of the parties .............................................. 934
                        2.  The controlling authority ............................................. 935
                        3.  Analysis in light of controlling authority ............................ 936
                            a.  Purpose of the "user fee" ......................................... 936
                            b.  Does reality belie the stated purpose? ............................ 937
                                 i.  Are the "user fees" used to pay costs or benefits? ........... 937
                                ii.  Is the "user fee" reasonably related to or a fair approximation
                                       of costs? ........................................................ 939
                               iii.  Is Sperry otherwise distinguishable? ......................... 940
                

                III. CONCLUSION ................................................................... 941
                

Distressed by imposition of a 6.3% "user fee" for 2001 on attorney fee awards for successful claimants pursuant Title II and Title XVI of the Social Security Act, a national organization of claimants' representatives and a representative of a prospective class of attorneys filed this action asserting a claim for mandamus and claims pursuant to the Administrative Procedures Act (APA), the "Little Tucker" Act, the "takings" clause of the Fifth Amendment to the United States Constitution, and the Freedom of Information Act (FOIA). In their motion challenging the plaintiffs' claims, the defendants seek judgment on the pleadings on the mandamus and FOIA claims, primarily on the ground that those claims are moot, and summary judgment on the remaining claims. In their response and cross-motion for partial summary judgment, the plaintiffs concede that the mandamus and FOIA claims are moot, but contend that they, not the defendants, are entitled to summary judgment on their "takings" and "APA" claims, and that genuine issues of material fact preclude summary judgment on their "Little Tucker Act" claim, if that claim is not subsumed by a successful "takings" or "APA" claim. In addition, the plaintiffs have moved to strike several of the affidavits offered by the defendants in support of their motion for summary judgment. Thus, the court is asked to determine not only the merits of the parties' cross-motions for summary judgment, but what evidence may be considered in support of those motions.

I. INTRODUCTION

A. Factual Background

1. Statutory framework

Title II of the Social Security Act provides for disability, survivors, and retirement insurance benefits, see 42 U.S.C. §§ 401-33, while Title XVI provides benefits to aged, blind, and disabled persons with limited income and resources. See id. at §§ 1381-83d. The Social Security Act permits claimants to have an attorney (or other representative) represent them in administrative proceedings. See 42 U.S.C. § 406(a)(1). When the Commissioner makes a determination favorable to a claimant who was represented by an attorney, the Commissioner is required to "fix (in accordance with the regulations prescribed pursuant to the [statute]) a reasonable fee to compensate such attorney for the services performed by him in connection with such claim," unless the claimant has a fee agreement with the attorney that meets certain requirements, in which case, the Commissioner must instead "approve" the fee agreement. See 42 U.S.C. § 406(a)(1) & (a)(2)(A).

2. "Ticket to Work Act" amendments

a. Authorization of a "user fee"

In 1995, the Social Security Administration (SSA) proposed that it be allowed to discontinue the attorney fee regulation process, estimating that the agency would thereby save $20 million in administrative costs annually. In response, in 1999, pursuant to the "Ticket to Work Act," see Ticket to Work and Work Incentives Improvement Act of 1999, Pub.L. 106-170, Congress amended the Social Security Act to impose an "assessment" on attorney fees in order to recoup the administrative costs associated with the attorney fee certification and regulation process. See 42 U.S.C. § 406(d)(1).² Both the plaintiffs and the defendants describe this "assessment" as a "user fee." For calendar years before 2001, Congress set the "user fee" at 6.3% of the attorney fee award, and for years after 2000, directed that the SSA set the "user fee" at "such percentage rate as the Commissioner determines is necessary in order to achieve full recovery of the costs of determining and certifying the fees to attorneys from the past-due benefits of claimants, but not in excess of 6.3 percent." 42 U.S.C. § 406(d)(2)(B). Thus, the "user fee" for 2001 and subsequent calendar years is "capped" at 6.3%.³

The statute authorizes assessment of this "user fee" on attorney fees awarded by the Commissioner following an award of benefits in the administrative process, as provided in § 406(a), and on attorney fees awarded by a court upon the rendering of a judgment favorable to a claimant, pursuant to § 406(b). See 42 U.S.C. § 406(d)(1) ("Whenever a fee for services is required to be certified for payment to an attorney from a claimant's past-due benefits pursuant to subsection (a)(4) or (b)(1), the Commissioner shall impose on the attorney an assessment in accordance with paragraph (2)."). However, at oral arguments, the parties agreed that the "user fee" is in fact assessed almost exclusively against attorney fees awarded by the Commissioner in the administrative process, whereas the vast majority of attorney fees awarded by a court in Social Security cases are awarded pursuant to the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412, and such a court-ordered award of attorney fees pursuant to the EAJA is not subject to the "user fee" in § 406(d).

b. Mandate for a GAO study

Another provision of the "Ticket to Work Act" mandated a study and report to Congress by the Comptroller General of the United States, General Accounting Office (GAO), that would examine the SSA's costs of administering the attorney fee certification and payment process. See Pub.L. 106-170, Title IV, § 406(c), Dec. 17, 1999, 113 Stat.1912; see also 42 U.S.C. § 406, Note, GAO Study and Report.⁴ The GAO's study and report were to be completed one year after enactment of the "Ticket to Work Act," that is, by December 17, 2000. Id. However, the GAO's Report was not actually submitted by the deadline. See Plaintiffs' Appendix at 30-63 (GAO Report). Thus, the GAO's Report was not considered by the SSA prior to its publication of notice of the percentage rate for the 2001 assessment.

3. Announcement of the 2001 "user fee"

On January 19, 2001, the SSA published a notice of the "Rate for Attorney Fee Assessment Beginning in 2001," written by Yvette S. Jackson, Deputy Commissioner for Finance, Assessment and Management, dated January 16, 2001. See 66 Fed.Reg. 5521 (Jan. 19, 2001); see also Plaintiffs' Appendix at 1. The "Summary" section of the notice stated the following:

The Social Security Administration is announcing that the attorney-fee assessment rate under section 206(d) of the Social Security Act, 42 U.S.C. § 406(d), for 2001 is 6.3 percent.

Id. In the "Supplementary...