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Five Points Road Joint Venture v. Johanns

September 8, 2008

FIVE POINTS ROAD JOINT VENTURE, AN ILLINOIS GENERAL PARTNERSHIP, JOHN BAENZIGER, CINDY BAENZIGER, ET AL., PLAINTIFFS-APPELLEES,
v.
MICHAEL O. JOHANNS, SECRETARY OF AGRICULTURE, UNITED STATES DEPARTMENT OF AGRICULTURE, OFFICE OF SECRETARY, AND ROGER KLURFELD, DIRECTOR, NATIONAL APPEALS DIVISION, A DIVISION OF THE UNITED STATES DEPARTMENT OF AGRICULTURE, DEFENDANTS-APPELLANTS.



Appeal from the United States District Court for the Northern District of Illinois, Western Division. No. 06 C 50145-Frederick J. Kapala, Judge.

The opinion of the court was delivered by: Ripple, Circuit Judge.

ARGUED APRIL 7, 2008

Before RIPPLE, WILLIAMS and SYKES, Circuit Judges.

In April 2005, the Farm Service Agency, an agency of the United States Department of Agriculture ("USDA"), ordered the plaintiffs (collectively, "Five Points") to refund certain benefits that they had received from it. Five Points appealed the decision to the National Appeals Division ("NAD"), which reversed the Farm Service Agency's determination in its entirety. Five Points then applied to the NAD for attorney's fees and costs under the Equal Access to Justice Act, 5 U.S.C. § 504 ("EAJA"), but the NAD denied the request on the ground that the EAJA did not apply to NAD adjudications. Five Points petitioned for review of the agency's denial of its EAJA request to the district court. The*fn1 district court held that the EAJA did apply to NAD adjudications and remanded for consideration of whether the requirements of the EAJA were met in this case. The Government now appeals the decision of the district court.*fn2

For the reasons stated in this opinion, we affirm the judgment of the district court.

I. BACKGROUND

In April 2005, the Farm Service Agency, an agency of the USDA, ordered Five Points to refund certain federal farm program benefits that it had received for the years 2003 and 2004. Five Points appealed that decision to an NAD hearing officer. The hearing officer reversed the Farm Service Agency's determination in its entirety. The Director of the NAD then affirmed the hearing officer's decision in favor of Five Points.

Following its successful appeal of the merits of its dispute, Five Points applied to the NAD Director for attorney's fees and costs under the EAJA, 5 U.S.C. § 504. The NAD Director denied Five Points' application because, in the Director's view, the EAJA did not apply to NAD adjudications. Five Points' request for reconsideration also was denied by the Director. Five Points sought review of that determination in the district court.

In the district court, Five Points and the Government filed cross-motions for summary judgment. Following the decision of the Eighth Circuit in Lane v. USDA, 120 F.3d 106 (8th Cir. 1997), the reasoning of which also was applied by the Ninth Circuit in Aageson Grain & Cattle v. USDA, 500 F.3d 1038 (9th Cir. 2007), it held that proceedings before the NAD are subject to the EAJA. The district court therefore granted Five Points' motion for summary judgment; it held that the NAD proceedings were "under" section 554 of the Administrative Procedure Act of 1946, 5 U.S.C. § 701 et seq. ("APA"), and that the plaintiffs, as the prevailing party in the agency proceeding, were entitled to attorney's fees and costs under the EAJA. The Director had erred, therefore, in refusing to consider the plaintiffs' application. The case was remanded to the agency for appropriate consideration of Five Points' application under the EAJA. The Government appealed.

II. DISCUSSION

We review de novo the district court's grant of sum-mary judgment. Foskett v. Great Wolf Resorts, Inc., 518 F.3d 518, 522 (7th Cir. 2008). On cross-motions for sum-mary judgment, we construe all facts and inferences therefrom in favor of the party against whom the motion under consideration was made. Id. Summary judgment is appropriate when "there is no genuine issue as to any material fact and . . . the movant is entitled to judgment as a matter of law." Id.; Fed. R. Civ. P. 56(c).

This case presents a single issue: whether the EAJA applies to administrative proceedings before the NAD. This issue presents a question of statutory interpretation.*fn3

The EAJA "provides that prevailing parties in certain adversary administrative proceedings may recover attorney's fees and costs from the Government." Ardestani v. INS, 502 U.S. 129, 132 (1991). In pertinent part, the EAJA states:

An agency that conducts an adversary adjudication shall award, to a prevailing party other than the United States, fees and other expenses incurred by that party in connection with that proceeding, unless the adjudicative officer of the agency finds that the position of the agency was ...


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