Trahan v. Regan, Civ. A. No. 82-3004.

• Decision Date: 18 November 1985
• Docket Number: Civ. A. No. 82-3004.
• Citation: 625 F. Supp. 1163
• Parties: Ava P. TRAHAN, et al., Plaintiffs, v. Donald T. REGAN, et al., Defendants.
• Court: U.S. District Court — District of Columbia

625 F. Supp. 1163

Ava P. TRAHAN, et al., Plaintiffs, v. Donald T. REGAN, et al., Defendants.

Civ. A. No. 82-3004.

United States District Court, District of Columbia.

November 18, 1985.

Bruce M. Fried, Washington, D.C., for plaintiffs.

Edith Marshall, U.S. Dept. of Justice, Washington, D.C., for defendants.

MEMORANDUM

GASCH, District Judge.

Currently before the Court is plaintiffs' application for an award of attorneys' fees and costs. For the reasons stated below, plaintiffs are awarded $25,743.75 in fees and $80 in costs.

I. THE FACTUAL BACKGROUND

This case concerns a notice mailed by the Department of Health and Human Services to Supplemental Security Income (SSI) recipients. The mailings asked approximately four million SSI recipients to sign a consent form allowing the Social Security Administration to obtain confidential tax information from the Internal Revenue Service (IRS). The forms stated, in part:

You have a choice about signing the form. But we must have accurate information about your income and what you own to pay your SSI checks. If you do not sign the form, your SSI checks may be affected.

The initial suit challenging the mailing was dismissed on a number of grounds. See Tierney v. Schweiker, No. 82-1638 (D.D.C. July 6, 1982). The IRS thereafter received consent forms signed by SSI recipients, including the plaintiffs. Plaintiffs then filed the instant suit to block any disclosure by the IRS. The Court granted defendants' motions to dismiss for lack of subject-matter jurisdiction and failure to state a claim. Trahan v. Regan, 554 F.Supp. 57 (D.D.C.1982).

The Court of Appeals reversed this Court's ruling and, upon reaching the merits, found that the consent forms were invalid because they were in violation of IRS regulations and because they could not result in a knowing waiver of confidentiality rights. Tierney v. Schweiker, 718 F.2d 449, 445-57 (D.C.Cir.1983). Plaintiffs then applied for attorneys' fees under the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412.¹

II. DISCUSSION

A. Application of 1985 Amendments to the EAJA

Sections of the EAJA which are relevant to this application were amended on August 5, 1985. See Equal Access to Justice Act Amendments, Pub.L. No. 99-80, 99 Stat. 183 (1985). These amendments apply to "cases pending on or commenced on or after" August 5, 1985. Id. § 7(a). The government argues that "cases pending" refers only to cases pending on their merits and not to pending attorneys' fees applications.

The "plain meaning" of the statute indicates that the amendments apply to this case. The statute does not qualify "cases pending" so as to exclude pending fee applications. Indeed, where a statute is concerned solely with fee applications, "cases pending" presumably would be commonly understood to include pending fee applications. As the Supreme Court recently noted:

Deference to the supremacy of the legislature, as well as recognition that congressmen typically vote on the language of a bill, generally require us to assume that "the legislative purpose is expressed by the ordinary meaning of the words used." Going behind the plain language of a statute in search of a possibly contrary congressional intent is a step to be taken cautiously even in the best of circumstances.

United States v. Locke, ___ U.S. ___, 105 S.Ct. 1785, 1793, 85 L.Ed.2d 64 (1985); see also Inner City Broadcasting Corp. v. Sanders, 733 F.2d 154, 158 (D.C.Cir.1984).

The Court acknowledges, however, that some of the legislative history contradicts this "plain meaning." The House Report and floor debate on H.R. 2378, the EAJA amendments bill, indicate some confusion as to the effective date provisions.² During debate on the amendments, one key supporter of H.R.2378 stated:

I would like to clarify the effective date provisions of H.R.2378 and the relationship of these provisions with the original act. Cases which were pending on October 1, 1984, including fee application proceedings, would be governed by the original act, provided that the time to file the fee application expired before the date of enactment of this bill.

131 Cong.Reg. H4762 (daily ed. June 24, 1985) (statement of Rep. Kastenmeier, Chairman of the Subcommittee on Courts, Civil Liberties, and the Administration of Justice of the House Committee on the Judiciary). The House Report on the bill, on the other hand, states:

The changes which are made by H.R. 2378 which merely clarify existing law are retroactive, and apply to matters which were pending on, or commenced on or after October 1, 1981. However, changes which are made by H.R.2378 and which expand or otherwise change existing law shall take effect on the date of enactment and shall apply to matters pending on or commenced after that date.

H.R.Rep. No. 120, 99th Cong., 1st Sess. 11 (1985), U.S.Code Cong. & Admin.News 1985, pp. 132, 139.

The 1985 amendments relevant to this case concern the meaning of "position of the United States" and "substantially justified." These phrases were part of the original EAJA, and the legislative history reveals that the 1985 amendments affecting these phrases were intended to "clarify" interpretation of existing law. As such, under the standard articulated in the House Report, these clarifications are applicable to this case.

The Court thus concludes that, through a "plain meaning" reading of the statute or by reference to legislative history, the 1985 amendments to the EAJA that are relevant to this case will govern assessment of the instant attorneys' fees application.

B. The EAJA Standard

As amended, the EAJA provides:

A court shall award to a prevailing party ... fees and other expenses ... incurred by that party in any civil action ..., including proceedings for judicial review of agency action, brought by or against the United States in any court having jurisdiction of that action, 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). Accordingly, if a party seeking attorneys' fees can establish that he is a "prevailing party," the government then can avoid an attorneys' fees award only by showing that its actions were "substantially justified" or that "special circumstances" counsel against an award.

1. "Prevailing Party" Requirement

The EAJA does not define "prevailing party" generally,³ but the phrase has been construed expansively. The Supreme Court recently articulated a typical construction:

Plaintiffs may be considered "prevailing parties" for attorney's fees purposes if they succeed on any significant issue in litigation which achieves some of the benefit the parties sought in bringing suit. This is a generous formulation....

Hensley v. Eckerhart, 461 U.S. 424, 433, 103 S.Ct. 1933, 1939, 76 L.Ed.2d 40 (1983).

Here defendants contend that plaintiffs' success was limited because plaintiffs sought injunctive, declaratory, mandamus and damages relief and received only declaratory relief. Nonetheless, plaintiffs sought, and received, a judicial decree prohibiting the release of confidential tax information on the basis of the consent forms. In that sense, plaintiffs succeeded on a "significant issue" that achieved "some of the benefit the parties sought in bringing suit"; as such, plaintiffs clearly are "prevailing parties."

2. "Position of the United States"

Prior to the 1985 amendments, the law in this circuit with respect to "the position of the United States" was set by Spencer v. National Labor Relations Board, 712 F.2d 539 (D.C.Cir.1983). Spencer held that "`the position of the United States,' for purposes of the EAJA, means the arguments relied upon by the government in litigation." Id. at 557.

This construction was overturned by the 1985 amendments, however:

"Position of the United States" means, in addition to the position taken by the United States in the civil action, the action or failure to act by the agency upon which the civil action is based....

Pub.L. No. 99-80, § 2(c)(2)(B), amending 28 U.S.C. § 2412(d)(2).⁴ The House Report, moreover, specifically rejects the "narrow interpretation" of Spencer and states that the proper construction "is much broader than the litigation position, and includes actions and omissions of an agency which formed the basis for the adversary adjudication." H.R.Rep. No. 120, at 11 & n. 19, U.S.Code Cong. & Admin.News 1985, p. 139, 140. The Report adds: "An omission which may be relevant includes the failure of an agency or its staff to act based on a statutory, regulatory, or constitutional duty." Id. at 11.

The EAJA does not define when an action is "substantially justified." The 1985 House report, however, states:

Several courts have held correctly that "substantial justification" means more than merely reasonable. Because in 1980 Congress rejected a standard of "reasonably justified" in favor of "substantially justified," the test must be more than mere reasonableness.

H.R.Rep. No. 120, at 9, U.S.Code Cong. & Admin.News 1985, p. 138. The "substantially justified" determination is to be made "on the basis of the record ... which is made in the civil action for which fees and other expenses are sought." Pub.L. No. 99-80, § 2(b), 99 Stat. 183, 184 (1985).

Thus, this Court must look to the "record ... made in the civil action," as delineated in Tierney v. Schweiker, 718 F.2d 449 (D.C. Cir.1983), to determine whether the acts and omissions of the IRS which led to the filing of this suit were "substantially justified."

The Tierney court found that the consent forms were the result of General Accounting Office reports that urged use of tax information to verify eligibility for SSI benefits. 718 F.2d at 451. The reports recommended that federal tax laws be amended expressly to permit access to tax files of SSI recipients or that action proceed administratively under Section 6103 of the Internal Revenue Code, which allows IRS disclosure upon taxpayer...