UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF NEW YORK
August 5, 1985
LYDIA CALLEJO, Plaintiff, against MARGARET M. HECKLER, Secretary of Health and Human Services, Defendant
The opinion of the court was delivered by: SPRIZZO
OPINION AND ORDER
SPRIZZO, D. J. :
Plaintiff Lydia Callejo commenced this action pursuant to 42 U.S.C. § 405(g) to review a decision of defendant Heckler, Secretary of Health and Human Services, terminating plaintiff's receipt of supplemental security income on the ground that her disability had ceased. The parties stipulated and the Court so ordered that the action be remanded to the Secretary "pursuant to 42 U.S.C. § 405(g) for the holding of a de novo hearing, good cause for such remand having been shown," and that "pending a final decision by the Secretary following said de novo hearing, plaintiff is entitled to receipt of continuing benefits . . . ."
On remand the Department of Health and Human Services Appeals Council decided that plaintiff was still disabled and therefore entitled to receive benefits. Plaintiff thereafter filed a motion pursuant to the Equal Access to Justice Act ("EAJA"), 28 U.S.C. § 2412(d)(1)(A), requesting an award of costs and attorneys' fees in connection with the instant action.
Section 2412(d)(1)(A) provides that in certain civil actions a court shall award costs and attorneys' fees to a party who prevails against the United States unless the court determines that "the position of the United States was substantially justified or that special circumstances make an award unjust."
That statute applies where, as here, an action is brought to review an administrative decision denying disability benefits. See, e.g., McGill v. Secretary of Health and Human Services, 712 F.2d 28, 30 (2d Cir. 1983), cert. denied, 465 U.S. 1068, 104 S. Ct. 1420, 79 L. Ed. 2d 745 (1984). The burden is on the Government to establish that its position was substantially justified, see, e.g., Boudin v. Thomas, 732 F.2d 1107, 1110 (2d Cir. 1984); Environmental Defense Fund, Inc. v. Watt, 722 F.2d 1081, 1085 (2d Cir. 1983), which requires essentially a "strong" showing of reasonableness. See, e.g., Boudin, supra, 732 F.2d at 1116; Environmental Defense Fund, supra, 722 F.2d at 1085; H.R. Rep. No. 1418, 96th Cong., 2d Sess. 9, 10-11, 18, reprinted in 1980 U.S. Code Cong. & Ad. News 4984, 4989, 4997.
Plaintiff argues that she is entitled to recover costs and attorneys' fees because (1) the position of the United States in the original agency proceedings terminating benefits was not substantially justified, as demonstrated by the reversal on remand, and (2) the position of the United States prior to remand in the instant litigation was not substantially justified.
The first claim is foreclosed by the law in this circuit which establishes that "the position of the United States" referred to in the statute does not refer to the position of the Government in any underlying agency proceedings. See Boudin, supra, 732 F.2d at 1115-16; see also Spencer v. NLRB, 229 U.S. App. D.C. 225, 712 F.2d 539, 557 (D.C. Cir. 1983), cert. denied, 466 U.S. 936, 104 S. Ct. 1908, 80 L. Ed. 2d 457 (1984). Therefore, to the extent plaintiff's claim is based upon the position of the Secretary in the original agency proceedings, this cannot afford a proper basis for an award of costs and counsel fees.
To the extent that plaintiff seeks attorneys' fees based upon the unreasonableness of the position of the United States in the present litigation, the Court also rejects that claim. The facts of this case demonstrate that the Government's litigation position was in all respects reasonable and consistent with its obligation to not litigate frivolous defenses.
Plaintiff filed her complaint on March 22, 1983. Service on defendant was made on May 12, 1983. While the parties stipulated to a number of extensions of time for defendant to answer, in fact the Government never filed an answer, or took any position with respect to either the merits of plaintiff's claim or the Secretary's decision. Rather, the parties stipulated to a remand, which was so ordered by the Court on December 6, 1983. At pre-trial conferences before this Court defendant explained that a remand was necessary due to the fact that the transcript of the agency proceedings could not be located, and the Secretary had been unable to reconstruct the file.
It is clear, therefore, that the Government never contested the merit of plaintiff's claim and did the only thing it could reasonably do under the circumstances, i.e., it agreed to a remand because it was in no position to ascertain, given the condition of the file, what its position on the merits should be.
Moreover, this agreement to remand for reasons unrelated to the merits is not sufficient to justify an award of costs and counsel fees. The Second Circuit has held that a social security claimant who obtains a court ordered remand for further consideration by the Secretary is not entitled to recover an EAJA award because they are not yet a "prevailing party" under the statute. See McGill, supra, 712 F.2d at 31. Citing the Supreme Court's decision in Hanrahan v. Hampton, 446 U.S. 754, 756-57, 64 L. Ed. 2d 670, 100 S. Ct. 1987 (1980) (per curiam), the court noted that "fee awards are appropriate only where 'a party . . . has established his entitlement to some relief on the merits of his claims.'" 712 F.2d at 31; see also Roman v. Schweiker, 559 F. Supp. 304, 305 (E.D.N.Y. 1983); cf. Environmental Defense Fund, supra, 722 F.2d at 1085 n.4. The Second Circuit stated that in the context of a social security case, the claimant generally "prevails" under the EAJA only "when it is determined that she is entitled to benefits." McGill, supra, 712 F.2d at 31-31. The Court sees no reason why a different result should obtain merely because the Government has agreed to such a remand. Indeed, such a rule would encourage the Government to engage in precisely the type of litigious conduct which the statute is designed to avoid.
Plaintiff also appears to argue that because she ultimately did prevail on the merits on remand, and since she had to bring this action to secure her rights, a fee award is mandated. Such a broad holding, however, which fails to consider whether the Government in this litigation affirmatively or unreasonably opposed plaintiff's claim, clearly distorts the meaning and intent of the statute. Cf. Spencer, supra, 712 F.2d at 555-56 & nn. 58 & 60; McGill, supra, 712 F.2d at 31-32. As the court noted in Boudin, the EAJA was not intended to be an "'automatic fee-shifting provision.'" See 732 F.2d at 1115-16 (quoting Spencer, supra, 712 F.2d at 553). The United States is not an insurer of an agency's action, and ultimately prevailing against the Government is not and should not be a guarantee that a claimant will recover an EAJA award. See, e.g., Ashburn v. United States, 740 F.2d 843, 850 (11th Cir. 1984); Spencer supra, 712 F.2d at 550; Correa v. Heckler, 587 F. Supp. 1216, 1223-24 (S.D.N.Y. 1984); H.R. Rep. No. 1418, supra, at 10-11, reprinted in 1980 U.S. Code Cong. & Ad. News, supra, at 4989.
By obtaining a voluntary remand herein, plaintiff did not in any way establish her entitlement to benefits. See, e.g., McGill, supra, 712 F.2d at 31-32. Nor did the Government concede that plaintiff did not in any way establish her entitlement to benefits. See, e.g., McGill, supra, 712 F.2d at 31-32. Nor did the Government concede that plaintiff was correct on the merits and abandon its prior opposition to her claim, as in Environmental Defense Fund, supra, 722 F.2d at 1086.
Therefore, the Court finds that the Government was entirely reasonable in taking no action to defend the Secretary's decision and stipulating to a remand after concluding that the record of the agency proceedings could not be reconstructed. The absence of a record meant there was no basis either for the United States to form a litigation position with respect to the Secretary's decision on the merits or for the Court to review the agency determination.
It follows that plaintiff's application for costs and attorneys' fees must be denied.
It is SO ORDERED.