Whiting v. Bowen

• Decision Date: 09 October 1987
• Docket Number: No. 84-C-773-C,84-C-236-C.,84-C-773-C
• Citation: Whiting v. Bowen, 671 F.Supp. 1219 (W.D. Wis. 1987)
• Parties: Mona R. WHITING, Plaintiff, v. Otis R. BOWEN, Secretary of Health and Human Services, Defendant. Thomas J. POLUS, Plaintiff, v. Otis R. BOWEN, Secretary, Department of Health and Human Services, Defendant.
• Court: U.S. District Court — Western District of Wisconsin

671 F. Supp. 1219

Mona R. WHITING, Plaintiff, v. Otis R. BOWEN, Secretary of Health and Human Services, Defendant.

Thomas J. POLUS, Plaintiff, v. Otis R. BOWEN, Secretary, Department of Health and Human Services, Defendant.

Nos. 84-C-773-C, 84-C-236-C.

United States District Court, W.D. Wisconsin.

October 9, 1987.

COPYRIGHT MATERIAL OMITTED

Mary Diezel, Western Wisconsin Legal Svcs., Dodgeville, Wis., for Whiting.

Craig A. Fobes, West St. Paul, Minn., for Polus.

David Sarnacki, Asst. U.S. Atty., Madison, Wis., for Bowen in No. 84-C-773-C.

Debra Schneider, Asst. U.S. Atty., Madison, Wis., for Bowen in No. 84-C-236-C.

ORDER

CRABB, Chief Judge.

This opinion consolidates two cases, both raising the issue whether attorneys' fees may be awarded under the Equal Access to Justice Act, 28 U.S.C. § 2412(d), to Social Security claimants who obtain disability benefits upon a remand to the Social Security Administration, rather than upon a court judgment. For the reasons that follow, I conclude that both plaintiffs are entitled to attorneys' fees under the Act.

Both of these cases were appeals to the district court from adverse decisions by the Secretary of the Department of Health and Human Services. Both plaintiffs claimed disability based on mental impairments. While plaintiffs' appeals were pending before this court, Congress passed the Social Security Disability Benefits Reform Act of 1984, which, among other things, required defendant to establish revised criteria for the determination of mental impairment disability. On his own motion, the United States Magistrate remanded the cases to defendant for reconsideration in light of those revised criteria. Upon reconsideration, the Secretary determined in each case that plaintiffs qualified as disabled individuals and awarded them benefits retroactive to their initial applications. Judgment in favor of Polus was entered January 6, 1987 affirming the revised decision of defendant. Judgment in favor of Whiting was entered on February 17, 1987.

Now before the court are the motions for an award of attorney's fees pursuant to the Equal Access to Justice Act, which provides for awards of fees against the United States and its agencies to "prevailing parties," unless the position of the United States was "substantially justified." In orders entered June 2, 1987, I determined that plaintiffs were prevailing parties for purposes of the Act, and I directed the parties to brief the issue of "substantial justification." In Whiting, defendant has chosen not to brief the issue of substantial justification, but has requested instead that I reverse my decision that plaintiffs are "prevailing parties" within the terms of the Act.

In Whiting, defendant argues against an award of attorney's fees on the grounds that (1) plaintiff is not a prevailing party because she did not prevail in this court, and (2) since this court never made a determination of plaintiff's claim on the merits, the court has no basis on which to make a determination that defendant's position was substantially justified. In Polus, defendant raises essentially the same objections. However, he also argues that he was substantially justified in denying Polus benefits based on the evidence available to the administrative law judges who considered Polus' first and third applications.

OPINION

The pertinent language of the Equal Access to Justice Act, 28 U.S.C. § 2412(d)(1)(A), reads as follows:

Except as otherwise specifically provided by statute, 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, unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.

One threshold matter requires discussion. In Henricks v. Bowen, No. 83-C-851-C (W.D.Wis. Dec. 22, 1986) Available on WESTLAW, DCT database, I denied a request for attorney's fees brought by a disability benefits claimant whose case had been remanded pursuant to another provision of the Social Security Disability Benefits Reform Act (addressing the treatment of medical improvement determinations), and who had had his benefits reinstated as a result of the remand. I said in that order that I did not believe that a claimant who obtained benefits as a result of a remand could be a "prevailing party" under the Equal Access to Justice Act. After reviewing plaintiffs' arguments in these cases, I am persuaded that I was wrong in that position.

1. Prevailing Party

Defendant contends that plaintiffs are not prevailing parties because they obtained benefits only because of an intervening change in the applicable law and not because of their having initiated litigation. Defendant's position is that merely obtaining what one sought by suing is not enough to make a plaintiff a prevailing party under the Equal Access to Justice Act. Something more is required: the result must be causally linked to the litigation, rather than, for example, the inevitable consequence of an intervening event. The leading case in support of this position is Nadeau v. Helgemoe, 581 F.2d 275 (1st Cir.1978), in which the court developed the "catalyst" test to determine prevailing parties under 42 U.S.C. § 1988, an attorneys' fee statute similar to the Equal Access to Justice Act. The "catalyst" test requires a showing that (1) the lawsuit was causally linked to the securing of the relief obtained, and (2) the defendants' response to the litigation must be one required by law rather than merely gratuitous.

To the extent that defendant is contending that plaintiffs should not be reimbursed for wholly unnecessary litigation, their position is compelling. To the extent they are asserting that simply because benefits are obtained after remand to an administrative agency rather than by a decision on the merits by a court, their position is far less compelling.

According to defendant's argument, the remand of plaintiffs' cases pursuant to the Reform Act precluded plaintiffs from qualifying as "prevailing parties," since the court did not have the opportunity to decide plaintiffs' cases on the merits. This argument assumes that in the typical appeal from a denial of benefits, courts do decide "on the merits." In so assuming, defendant ignores the special features inherent in the review of administrative actions.

Remands of disability benefits cases are common. Courts remand such cases to the Secretary for reconsideration where they find that the Secretary's decision is not supported by substantial evidence, see, e.g., Taylor v. Schweiker, 739 F.2d 1240 (7th Cir.1984) (reversing district court's affirmance of Secretary's denial of benefits with directions to remand to Secretary, where administrative law judge failed to consider all the evidence), or where the Secretary has incorrectly applied the law as interpreted by the relevant circuit, see, e.g., Cannon v. Harris, 651 F.2d 513 (7th Cir. 1981) (reversing district court's affirmance of Secretary's denial of benefits, where administrative law judge erred in applying Secretary's regulations). If the Secretary reverses his negative decision upon remand and awards the claimant benefits, the claimant may seek attorney's fees without the court's ever having decided his case "on the merits," at least in the traditional sense. A "traditional judgment" is on the merits "if it completely disposes of the underlying cause of action, or determines that the plaintiff has no cause of action." Harper Plastics, Inc. v. Amoco Chemicals Corp., 657 F.2d 939, 943 (7th Cir.1981) (citations omitted). By this standard, remands for lack of substantial evidence or misapplication of the law are not decisions "on the merits." The underlying cause of action in a disability benefits case is the claimant's application for judicial review of the secretary's decision that the claimant is not disabled, or no longer disabled. A court's decision to remand does not reach this ultimate issue. Yet courts have uniformly found claimants to be "prevailing parties" where remands resulted in an award of benefits. See, e.g., Miller v. United States, 753 F.2d 270, 273-74 (3d Cir.1985) (since claimant had been granted benefits by agency on remand, there was "no question" that Miller is a prevailing party); Cook v. Heckler, 751 F.2d 241 (8th Cir. 1984) (it is the receipt of benefits that renders a typical social security claimant a prevailing party); McGill v. Secretary of Health & Human Services, 712 F.2d 28, 32 (2d Cir.1983) (party obtaining remand "will not become a prevailing party unless and until she is awarded benefits, at which time her application for appropriate attorney's fees may again be considered"); Hutchinson v. Heckler, 612 F.Supp. 264, 269 (E.D. Wis.1985) (Secretary's decision on remand that claimant continued to be disabled made claimant a prevailing party); Andino v. Heckler, 609 F.Supp. 293, 295 (E.D.Wis. 1985) ("a claimant who is awarded and receives benefits after remand from the district court is entitled to the entry of final judgment as the prevailing party").

Furthermore, it does not follow from the fact that a court does not decide the case on the merits when it makes a remand to the Secretary that the parties' arguments have never been considered on the merits. In disability benefits appeals, decisions on the merits are made at the administrative level, after hearings before an administrative law judge. These administrative hearings are considered analogous to judicial proceedings. By law, the decisions reached at Social Security Administration hearings have the effect of final judgments. 42 U.S.C. § 405(h). See also Delamater v. Schweiker, 721 F.2d 50, 53 (2d Cir.1983); Restatement (Second) of Judgments § 83 (1982); K. Davis, 4 Administrative Law Treatise § 21:3 (2d ed. 1983).

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