Rawlings v. Heckler

• Decision Date: 08 May 1984
• Docket Number: No. 82-4545,82-4545
• Citation: 725 F.2d 1192
• Parties: Hattie RAWLINGS and Edwin Lingsch, Jr., individually and on behalf of all others similarly situated, Plaintiffs-Appellees, v. Margaret M. HECKLER, Secretary, Department of Health and Human Services, Defendant-Appellant.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1192

725 F.2d 1192

4 Soc.Sec.Rep.Ser. 71

Hattie RAWLINGS and Edwin Lingsch, Jr., individually and on behalf of all others similarly situated, Plaintiffs-Appellees, v. Margaret M. HECKLER, Secretary, Department of Health and Human Services, Defendant-Appellant.

No. 82-4545.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted July 11, 1983.

Decided Feb. 13, 1984.

Amended on Denial of Rehearing May 8, 1984.

Tricia Berke, Susan K. Jackson, Redwood City, Cal., for plaintiffs-appellees.

Joseph P. Russoniello, U.S. Atty., Barbara J. Parker, Asst. U.S. Atty., San Francisco, Cal., William Kanter, Carlene McIntyre, Dept. of Justice, Washington, D.C., for defendant-appellant.

Appeal from the United States District Court for the Northern District of California.

Before TANG, and REINHARDT, Circuit Judges, and BURNS ^*, District Judge.

TANG, Circuit Judge.

This is an appeal from an order of the district court awarding attorneys' fees and expenses of $6,131.25 to plaintiffs under the Equal Access to Justice Act (EAJA), 28 U.S.C. 2412(d)(1)(A).

Plaintiffs, members of a class of Supplemental Security Income (SSI) recipients, sued the Secretary of Health and Human Services (Secretary), seeking statewide injunctive and declaratory relief. They sought to have the Secretary enjoined from offsetting underpayments of benefits due recipients but not timely paid to them against prior overpayments made to recipients. Plaintiffs also sought to compel the Secretary to provide notice and a hearing before such offsets were made.

The dispute arose when the Secretary withheld SSI payments from the two named plaintiffs, Rawlings and Lingsch. Each plaintiff had in previous quarters received SSI overpayments. In each case the previous overpayment was being deducted from monthly payments in amounts of $5 and $50 respectively. In February 1981, Rawlings became entitled to additional SSI benefits, which instead of being paid to her, were offset against her outstanding overpayment. Similarly, in February 1981 Lingsch became entitled to additional SSI benefits. When Lingsch failed to receive his February and March payments, he visited his local Social Security office and was told that his February and March benefits had been withheld because of the outstanding overpayments. Both Rawlings and Lingsch were told they had no right to appeal.

Plaintiffs filed this action April 7, 1981. The Secretary answered June 22, 1981, denying most of plaintiffs' factual allegations and raising the defenses of lack of subject matter jurisdiction, failure to state a claim, and sovereign immunity. The parties entered a settlement agreement April 12, 1982, which provided substantially all of the relief requested by plaintiffs.

Upon motion by plaintiffs for attorneys fees, and after a hearing at which the Secretary opposed the motion, the district court awarded plaintiffs attorneys' fees of $6,131.25.

We decide the following issues:

1) Does the EAJA authorize attorneys' fees incurred before October 1, 1981, the effective date of the Act?

2) In determining whether the position of the United States was substantially justified, should the district court evaluate the pre-litigation Government actions giving rise to the suit, the government litigation position, or both?

In reviewing a district court's decision to award attorneys' fees, we will reverse only if the court has abused its discretion. Hoang Ha v. Schweiker, 707 F.2d 1104, 1105 (9th Cir.1983). In determining whether the district court applied the correct legal standard in awarding fees, we review the court's decision de novo. Foster v. Tourtellotte, 704 F.2d 1109, 1111 (9th Cir.1983).

A. Fees Incurred Before October 1, 1981

A good deal of the work done on this case was performed before October 1, 1981, the effective date of the Act. The government concedes that the Act applies to this case, because the case was "pending" on October 1, 1981. The government argues, however, that if plaintiffs are entitled to any attorneys fees at all, only fees incurred after October 1, 1981 can be recovered from the government. The government also argues that the doctrine of sovereign immunity bars an award of fees that is not specifically provided by statute, citing 28 U.S.C. 2412(a).

The EAJA provides that:

[t]his title and the amendments made by this title shall take effect of [sic] October 1, 1981, and shall apply to ... any civil action ... described in section 2412 of title 28, United States Code, which is pending on, or commenced on or after, such date.

Public Law 96-481 Sec. 208, 94 Stat. 2330 (1980).

We reject the government's arguments. We agree with those courts which have reasoned that the plain meaning of the statute allows for recovery of fees incurred prior to October 1, 1981, as long as the action was pending on that date. Had Congress intended no reimbursement for fees incurred prior to October 1, 1981, it could easily have so stated. Tyler Business Services, Inc. v. N.L.R.B., 695 F.2d 73, 77 (4th Cir.1982).

The Supreme Court has approved awards of fees for work done before the effective date of similar statutes authorizing attorneys fees awards. See Hutto v. Finney, 437 U.S. 678, 694 n. 23, 98 S.Ct. 2565, 2575 n. 23, 57 L.Ed.2d 522 (Civil Rights Attorney's Fees Act); Bradley v. School Board of the City of Richmond, 416 U.S. 696, 94 S.Ct. 2006, 40 L.Ed.2d 476 (1974) (Education Act Amendments of 1972); see also Underwood v. Pierce, 547 F.Supp. 256, 260-61 nn. 6 & 7 (1982).

The government argues that because these cases did not involve an award of fees against the government and therefore did not involve the problem of sovereign immunity, they are distinguishable. We disagree. In Hill v. United States, 571 F.2d 1098 (9th Cir.1978), we specifically relied on Bradley to address a question involving a retrospective waiver of sovereign immunity. Citing Bradley, 416 U.S. at 711, 94 S.Ct. at 2016, we stated that the Supreme Court has held that " 'a court is to apply the law in effect at the time it renders its decision, unless doing so would result in manifest injustice or there is a statutory direction or legislative history to the contrary.' " 571 F.2d at 1102. We find no possibility of manifest injustice here, nor do we find a hint of legislative history to the contrary. We reject the government's attempted distinction of Bradley in this case. The district court's decision that attorneys fees may be awarded for work performed prior to October 1, 1981, where the case was pending on that date, is affirmed.

B. "Position" of the United States

The EAJA provides, in relevant part: "[A] court shall award to a prevailing party other than the United States fee and other expenses ... incurred by that party in any civil action brought by or against the United States ... unless the court finds the position of the United States was substantially justified...." 28 U.S.C. 2412(d)(1)(A). The parties disagree over the construction of the term "position" of the United States.

The Secretary argues that in determining whether the position of the United States was substantially justified, the government position to be scrutinized is that taken in the litigation itself. The Secretary urges that the government's litigation position was essentially one of accommodation to plaintiff's requested relief, and that the fee award should be reversed. Plaintiffs argue that the government position to be evaluated is the underlying government action giving rise to the litigation. The critical inquiry according to plaintiffs is whether there was a factual and legal justification for the underlying government action. Plaintiffs contend that the Secretary failed to carry its burden of establishing justification for either the underlying agency action or policy or the Secretary's delay in settling the case.

The district court below seemingly took a third approach. Although the court stated that the government's post litigation position was an inappropriate consideration, it held that "defendant's position prior to the litigation, or at the time of the litigation, was not justified...."

The courts are divided over the proper definition of the term "position" of the United States. Some courts follow the "litigation position" theory, which examines the government's litigation posture. See, e.g., Spencer v. N.L.R.B., 712 F.2d 539, 556 (D.C.Cir.1983); Electronic Modules Corp. v. United States, 702 F.2d 218, 219 (Fed.Cir.1983). Other courts follow the "underlying action" theory, which focuses on the governmental action that precipitated the litigation, as well as, in most instances, on the government's litigation posture. See, e.g., Natural Resources Defense Council, Inc. v. E.P.A., 703 F.2d 700, 708 (3d Cir.1983); Tyler Business Services, Inc. v. N.L.R.B., 695 F.2d 73, 75-76 (4th Cir.1982). See also Spencer, 712 F.2d at 546 n. 28.

This Circuit has not issued a definitive ruling on the correct interpretation of "position." We have, however, shown a preference for the broader "underlying action" theory, which examines the totality of a situation. As we have stated previously: "For practical purposes, the distinction between defining 'position' as the litigation position or the underlying agency conduct makes little difference. Courtroom attempts to defend unreasonable agency actions usually will be unreasonable also." Hoang Ha, 707 F.2d at 1106.

Several courts have found, often after painstaking review, that the EAJA's legislative history is inconclusive on the construction of the term "position." See, e.g., Spencer, 712 F.2d at 547-49; Citizen Coalition for Block Grant Compliance v. City of Euclid, 537 F.Supp. 422, 426 (N.D.Ohio 1982). We arrive at the same conclusion. The legislative history shows that the term "position of the United States" was employed at times to refer to the underlying actions of an agency, and at other times to the litigation position of the government. Compare H.R.Rep. No. 1418, 96th...