We discussed the Court Scrutiny of EAJA Settlements with a Federal Agency in 2016. The resort to second-guessing the settlement choices of the parties has slowed but continues. The court scrutiny continues not only as to hours but also rates. Today, we examine a different aspect of the of same problem.
The Commissioner denies a claim for Social Security disability benefits. The claimant proceeds to federal court and prevails. The Equal Access to Justice Act provides limited relief for having to litigate against the federal government when it has acted without substantial justification. The Supreme Court holds that a request for attorney's fees "should not result in a second major litigation." Hensley v. Eckerhart. The Court continues to observe that: "Ideally, of course, litigants will settle the amount of a fee." Id.
If we assume that the Supreme Court is right, mostly because it is final, how should the courts treat stipulations and unopposed motions that "settle the amount of the fee?" Douzat v. Saul, 2020 WL 3408706 (D. Nev. Jun. 11, 2020) found that the district court had the right if not the obligation to review the hours and rates despite the presentation of a stipulation for fees settling the matter. Dissatisfied with the fee award and then potential offset against fees that he might owe later, Douzat appealed. Pursuant to joint motion, the Ninth Circuit awarded the fees in the stipulated amount. Douzat v. Saul, 2020 WL 8182913 (9th Cir. Oct. 16, 2020). The Ninth Circuit stated that the order served as the mandate. The District Court then "spread" the mandate of the Ninth Circuit on the docket of the District Court.
Technically, the order of the District Court was not vacated. It was superseded. The order is not the order of the federal courts on the issue of fees awarded Douzat. The District Court should stop citing Douzat because it is not the final order of the court. The Court should also take note that whatever angst it has with a party getting a fee award under the EAJA, in in forma pauperis plaintiff will fill an appeal to the Ninth Circuit, the parties will file a joint motion awarding the fees sought, and the order of the District Court will become a nullity.
Bascom v. Kijakazi, 2021 WL 5826311 (D. Nev. Dec. 8, 2021) is more shocking. The parties settled quickly without briefing. The parties stipulated to fees of $1,100. The District Court spent more time analyzing the fees than any party did in providing legal services on the merits, reducing the settled fee to $637.50. Bascom filed an appeal. On joint motion dismissing the appeal, the Ninth Circuit awarded the fees and expenses to which the parties had agreed, $1,100. Bascom v. Kijakazi, 2022 WL 945331 (9th Cir. Feb. 15, 2022).
Brown v. Kijakazi, 2021 WL 56181753 (D. Nev. Nov. 8, 2021) is a tragedy. The District Court had before it an unopposed motion for fees in the amount of $7,500. Undaunted by the lack of opposition, the District Court reduced the hourly rate to $125 per hour and awarding $4,950 in fees. The docket does not show that Brown appealed despite initiating the action in forma pauperis. Counsel in the case did get costs of $250 which appears to represent the pro hac vice fee -- which is not a cost but might be a recoverable expense.
When the courts reduce EAJA fees, the losers are several. First, counsel for the parties should take the extra time on the chin to file an appeal, enter mediation, and file a joint motion for fees and dismissing the appeal. Time is money. The attorneys for the plaintiff and the agency lose. The Ninth Circuit loses, having to docket an appeal, absorb the time of a mediator, granting a motion, and issuing a mandate. The Court lose. The biggest loser is the claimant for benefits. The courts deprive the party of a reimbursement, offset, or credit against fees that the claimant deserves.
Let's go back to Douzat. After the dust settled and the agency heard the case on remand, counsel went back to the District Court and sought fees. The Court awarded $32,000 in fees under section 406(b) and ordered a reimbursement of $4,500 for EAJA fees awarded by the Ninth Circuit. Douzat v. Kijakazi, 2021 WL 9316346 (D. Nev. Aug. 24, 2021). Had counsel been unwilling to "waste" the time on an appeal to the Ninth Circuit, Douzat would not have received a $4,500 reimbursement but instead the paltry $2,975 awarded by the District Court in the first instance.
Douzat is dead and the courts should stop citing it. It is not good law, it is punitive, it wastes the scarce resources of time of not only the parties and their attorneys but also the District Court and the Ninth Circuit, and most importantly it violates the intent of the Equal Access to Justice Act. Please, Your Honor, take your foot off the neck of the plaintiff and the attorneys and please, stop treating government lawyers like they need your help.
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Suggested Citation:
Lawrence Rohlfing, Court Scrutiny of EAJA Settlements -- Citing Vacated Decisions, California Social Security Attorney (September 17, 2022) https://californiasocialsecurityattorney.blogspot.com. Updated December 28, 2022.
The author has been AV-rated since 2000 and listed in Super Lawyers since 2009.
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