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September 7, 1982


The opinion of the court was delivered by: Prentice H. Marshall, District Judge.


In these two separate actions plaintiffs, having successfully challenged certain administrative actions by the Department of Housing and Urban Development ("HUD"), have moved for an award of attorney's fees against the federal government under the Equal Access to Justice Act ("EAJA"), 5 U.S.C. § 504, 28 U.S.C. § 2412(d) (Supp. IV 1980). While the cases raised separate issues on the merits, the attorney's fees motions come to us at the same time and raise similar questions under the EAJA. In addition, the plaintiffs in both cases are represented by the Legal Assistance Foundation of Chicago and the federal defendant is represented by the same Assistant United States Attorney. Not surprisingly, then, the briefs submitted by the parties in each case are practically identical, with the exception of application of the disputed legal standards to the distinct factual situations. We have consolidated the cases for purposes of our decision on the attorney's fees question.

The EAJA became effective October 1, 1981. The amount of litigation already decided under the Act is testimony to the fact that rarely will lawyers move more swiftly or adroitly than where questions of attorney's fees are at issue. The government for its part is attempting to protect its purse strings by consistently arguing, so far unsuccessfully, that the Act cannot possibly mean what it says. These cases present us with several questions of importance under the EAJA; we treat them in turn.

The government's first line of defense is that an award of fees in both of these cases is barred by the doctrine of sovereign immunity. There is no dispute that Congress waived sovereign immunity in enacting the EAJA. The whole purpose of the statute was to make attorney's fees available against the government where private litigants successfully challenged or defended against agency actions. See generally H.Rep. No. 1418, 96th Cong., 2d Sess., 8-13 (1980) reprinted in [1980] U.S.Code & Admin.News 4984, 4986-92. In its statement of findings Congress declared the Act necessary to offset the high cost of litigation which frequently deterred private parties from seeking review of unreasonable agency actions, and to subject the government to fees under a standard even more beneficial to a prevailing party than embodied in the "American rule" regarding awarding of fees. See infra at 1160-1161. Accordingly, the government does not deny that the statute is an express waiver of sovereign immunity. The question raised is simply one of timing: when does the waiver take effect?

The EAJA was passed on October 4, 1980 and implemented according to the following provision:

  [This section] shall take effect on October 1,
  1981 and shall apply to any adversary
  adjudication . . . and any civil action . . .
  which is pending on, or commenced on or after,
  such date.

5 U.S.C. § 554 note. The government's contention is that while the Act clearly covers cases pending on October 1, 1981, it only applies to that portion of legal work done after October 1, 1981. The argument is predicated in large measure on the generalization that waivers of sovereign immunity must be expressed and cannot be implied. See United States v. Mitchell, 445 U.S. 535, 538, 100 S.Ct. 1349, 1351, 63 L.Ed.2d 607 (1980); United States v. Testan, 424 U.S. 392, 399, 96 S.Ct. 948, 953, 47 L.Ed.2d 114 (1976); United States v. King, 395 U.S. 1, 4, 89 S.Ct. 1501, 1502, 23 L.Ed.2d 52 (1969). But, unlike the cases cited, we are not asked here to construe an otherwise ambiguous statute and infer a consent to be sued on the part of Congress.*fn1 The general prohibition against awarding fees and costs against the federal government, embodied in 24 U.S.C. § 2412 (1976), see Alyeska Pipeline Co. v. Wilderness Society, 421 U.S. 240, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975), was abrogated by the EAJA. See Commissioners of Highways v. United States, 681 F.2d 821 (7th Cir. 1982) ("The Act constitutes a significant relaxation of sovereign immunity in actions seeking attorneys' fees from the United States.") Indeed, in one of the cases cited by the government for the general proposition that the United States is immune from an award of fees absent an express waiver, Knights of the Ku Klux Klan v. East Baton Rouge Parish School Board, 643 F.2d 1034 (5th Cir. 1981), the Supreme Court granted a petition for certiorari, vacated the judgment summarily and remanded for reconsideration in light of the EAJA, East Baton Rouge Parish School Board v. Knights of the Ku Klux Klan, 454 U.S. 1075, 102 S.Ct. 626, 70 L.Ed.2d 609 (1982). Despite the fact that all of the legal work was done on the case prior to October 1, 1981, on remand the Fifth Circuit held the case was "pending" within the meaning of the statute and remanded to the district court for determination of whether plaintiffs were otherwise qualified for an award of fees. See Knights of the Ku Klux Klan v. East Baton Rouge Parish School Board, 679 F.2d 64 at 67-68 (Former 5th Cir. 1982).*fn2 Neither the Supreme Court nor the Fifth Circuit expressed any reservations about the scope of the waiver contained in the EAJA.

In any question of statutory construction, no less in questions of sovereign immunity, we must begin with the language of the statute itself. Absent an indication to the contrary in the legislative history, the plain language of the statute governs our interpretation. See Consumer Product Safety Comm'n v. GTE Sylvania, Inc., 447 U.S. 102, 108, 100 S.Ct. 2051, 2056, 64 L.Ed.2d 766 (1980); Aaron v. SEC, 446 U.S. 680, 700, 100 S.Ct. 1945, 1957, 64 L.Ed.2d 611 (1980); Perrin v. United States, 444 U.S. 37, 42, 100 S.Ct. 311, 314, 62 L.Ed.2d 199 (1979); Photo Data, Inc. v. Sawyer, 533 F. Supp. 348, 350 (D.D.C. 1982). There is nothing ambiguous about the language of the EAJA — the statute applies as of October 1, 1981 to qualifying cases "pending on, or commenced on or after, such date." The government's argument would have us read into the statute a qualification (applying the statute to pending cases, but only for that portion of the work done after October 1, 1981) which simply does not exist. As another court said in response to the same argument:

    The plain meaning of the EAJA is contrary to
  the Secretary's argument. The EAJA explicitly
  waives sovereign immunity with regard to a civil
  action or adversary adjudication pending on
  October 1, 1981. The Secretary's argument
  requires an exception to be read into the
  effective date provision, and this the court
  cannot do. The civil action before this court was
  pending on October 1, 1981. This effective date
  provides no barrier to an award of fees and
  expenses which might have occurred before October
  1, 1981. Congress limited the applicability of
  the EAJA to cases pending on October 1, 1981. If it
  had intended to further narrow the number of
  applicable cases in this "pending" status, it could
  have done so by restricting potential cost and fee
  awards to those incurred after the effective date.

Wolverton v. Schweiker, 533 F. Supp. 420, 423 (D.Idaho 1982) (emphasis original); Accord Photo Data, Inc. v. Sawyer, 533 F. Supp. 348 (D.D.C. 1982); see also Heydt v. Citizens State Bank, 668 F.2d 444 (8th Cir. 1982) (applying EAJA to pre-October, 1981 services, but finding government's position substantially justified); WATCH v. Harris, 535 F. Supp. 9 (D.Conn. 1981) (awarding fees for pre-effective date services); Spang v. United States, 533 F. Supp. 220 (W.D.Okla. 1982) (same); Berman v. Schweiker, 531 F. Supp. 1149 (N.D.Ill. 1982) (same); Under-wood v. Pierce, 547 F. Supp. 256, 260-261 (C.D.Cal. 1982) (same).*fn3

Defendants have cited nothing in the legislative history of the EAJA to cause us to depart from the plain meaning of the statute.*fn4 But HUD contends that the purpose of the statute will not be furthered by an award of pre-effective date fees and argues that the cost estimates and budget allocations under the Act indicate that awarding such fees was not contemplated by Congress. Neither argument is persuasive.

The legislative history of the statute provides ample support for applying the waiver to pre-effective date legal work. One of the principal purposes of the Act was to permit an award of fees under the common benefit or common fund approach which was not previously available to litigants against the government, see 28 U.S.C. § 2412(b), see also Alyeska Pipeline v. Wilderness Society, 421 U.S. 240, 95 S.Ct. 1612, 44 L.Ed.2d 141 (1975); H.Rep. No. 1418 at 6, reprinted in [1980] U.S.Code Cong. & Admin.News 4984, 4985 (expressing intent to partially overrule Alyeska Pipeline). The House Report indicates that

  [t]he bill rests on the premise that a party who
  chooses to litigate an issue against the
  Government is not only representing his or her
  own vested interest but is also refining and
  formulating public policy. . . . The bill []
  recognizes that the expense of correcting error
  on the part of the Government should not rest
  wholly on the party whose willingness to litigate
  or adjudicate has helped to define the limits of
  Federal authority. Where parties are serving a
  public purpose, it is unfair to ask them to
  finance through their tax dollars unreasonable
  Government action and also bear the costs of
  vindicating their rights.

Id. at 10, U.S.Code Cong. & Admin.News at 4988-89, See also House Conf.Rep. No. 96-1434, 96th Cong., 2d Sess. 25 (1980) reprinted in [1980] U.S.Code Cong. & Admin.News, 5003, 5014. Thus, construing the statute to require a party to bear its own fees where the case is clearly pending on the Act's effective date and the government's position is found to be unreasonable is contrary to the purpose, as well as the plain language, of the statute. Accord Photo Data, Inc. v. Sawyer, 533 F. Supp. at 351; Under-wood v. Pierce, at 261 n. 7.*fn5

Finally, the cost analysis relied on by the defendant actually supports the result we reach here. The Congressional Budget Office (CBO) cost estimates are based on the number of cases likely to be decided adversely to the government during each fiscal year and the average cost to the government of a reasonable attorney's fee in each case. The increase in costs estimated for the second and third year of the program is designed to accommodate the fact that each year the number of cases involving the government has increased slightly, thus the number of adverse decisions, it is assumed, will increase proportionally. See H.Rep. No. 1418, supra at 21, 22, U.S.Code Cong. & Admin.News at 5000, 5001.*fn6 Moreover, the CBO cost estimate assumes that the Act will achieve its intended effect of reducing the deterrence to challenging the government with the result that the number of cases brought will increase, and includes a slight increase in the size of the estimated average award to account for changes in the consumer price index. Id. at 22-23, U.S.Code Cong. & Admin.News at 5001-02. There is absolutely no justification for reading the cost estimates as anticipating a bifurcation of fees depending on whether work in a pending case was performed before or after October 1, 1981.

In light of the plain language of the statute and the history which supports it, we conclude that the EAJA constitutes a waiver of sovereign immunity by the government in cases pending on October 1, 1981, for attorney's ...

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