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COSTANTINO v. UNITED STATES

December 1, 1981

Margaret COSTANTINO
v.
UNITED STATES of America



The opinion of the court was delivered by: WEINER

MEMORANDUM OPINION AND ORDER

This action for recovery of allegedly overpaid taxes for the years 1977 and 1978 was resolved pursuant to an agreement between the parties. On October 19, 1981, this court entered judgment in favor of the plaintiff for taxes overpaid for 1977, in the amount of $ 1,283.00, plus interest, and judgment in favor of the defendant and dismissal of the plaintiff's other claims for recovery of allegedly overpaid taxes for 1977 and 1978. Also on that date, plaintiff filed an application for an award of attorney's fees and expenses, pursuant to the recently amended 28 U.S.C. § 2412.

 The government opposes the award of attorney's fees, claiming that plaintiff is not the prevailing party, that the government's position in withholding the refund was substantially justified, that plaintiff unduly protracted final resolution of the case, and that the fee application is procedurally deficient. For the reasons to follow, the plaintiff's application is denied, without prejudice, with leave to amend within twenty (20) days.

 The Equal Access to Justice Act, P.L. 96-481, 94 Stat. 2321, which took effect October 1, 1981, amended 28 U.S.C. § 2412 to permit a court, in its discretion, to award reasonable attorney's fees, expenses and costs to the prevailing party in any civil action brought by or against the United States. The United States is liable for such fees and expenses to the same extent that any other party would be liable under the law for such an award, unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.

 In the analogous context of applying the prevailing party language of the Civil Rights Attorney's Fees Award Act, Publ.L. 94-559, 90 Stat. 2641, the Third Circuit has stated that the district courts "should analyze the results obtained by the petitioning party on particular claims." Hughes v. Repko, 578 F.2d 483, 487 (3d Cir. 1978). The court went on to say that "(a) prevailing party on a particular claim is one who fairly can be found ... to have essentially succeeded on such claim.... (In) many cases a party may prevail on his basic claim but not on all aspects thereof." Id. "If he essentially succeeds in obtaining the relief he seeks in his claims on the merits, the plaintiff becomes a prevailing party. Swietlowich v. County of Bucks, 620 F.2d 33, 34 (3d Cir. 1980). "(T)he fee-petitioner cannot be treated as the prevailing party to the extent he has been unsuccessful in asserting a claim." Hughes v. Repko, 578 F.2d at 487.

 In support of its argument that plaintiff is not a prevailing party, the government asserts that an award of attorneys fees is unwarranted because it has always been the government's position, both before the start and throughout the course of this litigation, that plaintiff was entitled to a refund of $ 1,283.00. It is precisely that amount which the government has agreed to refund in settlement of plaintiff's claim. Unfortunately for the government, its very assertion of that argument reveals just how untenable its position really is. The very statement that the government recognized that the money was due plaintiff, coupled with the fact that it had not yet been paid to her at the time the lawsuit was commenced, leads to the inescapable conclusion that the lawsuit itself is directly responsible for payment of the $ 1,283.00 which will be made to plaintiff. Thus, to say that the plaintiff did not prevail is to ignore the history of this matter before commencement of this litigation, and the plaintiff's unsuccessful attempts to obtain a refund, for despite the admission of the IRS in 1979 that the money should and would be refunded, it was only after the present legal action was initiated, and as a direct result thereof, that the money will finally be refunded.

 Of course, plaintiff has the status of a prevailing party only with regard to the $ 1,283.00 refund, for by the terms of the settlement, that is the only claim for which it will be paid.

 Similarly, the assertion that the government's action was substantially justified must be rejected, for if the government never contested the $ 1,283.00 refund, what possible justification could there be for its failure to pay that money to plaintiff. As for the government's alleged justification of its actions with regard to the plaintiff's other claims, on which plaintiff did not prevail, the government may not thereby attempt to justify the withholding of a payment which it itself has admitted, since 1979, it owed to plaintiff. Moreover, this case appears to be precisely the type which Congress intended to be covered by the Equal Access to Justice Act, for there is here no good reason to deny an award of attorneys fees and costs.

 Turning to the government's next contention, we do not believe that plaintiff or her counsel unduly protracted final resolution of this matter in order to fall within the ambit of the October 1, 1981 statutory changes regarding award of attorneys fees against the United States. Indeed, such an argument is at best disingenuous when advanced by the party which has by its own actions delayed refund of an overpayment first brought to its attention in 1978.

 We have concluded that plaintiff is entitled to an award of attorneys fees and costs to the extent that she is the prevailing party in this litigation. However, plaintiff's attorney has not provided the court with a breakdown of the time spent solely in support of plaintiff's $ 1,283.00 claim on which she did prevail, nor was there any attempt to differentiate between the time spent on that claim and the time spent on the other claims on which plaintiff did not prevail. Nevertheless, with regard to time spent on non-prevailing claims, "(s)uch services are compensable ... if they overlapped and also supported the prosecution of a successful claim." Planned Parenthood Ass'n of Southeastern Pennsylvania, 508 F. Supp. 567, 570 (E.D.Pa.1980).

 Despite our conclusion that an award of fees and costs is appropriate in this matter, on the basis of the information supplied to the court by plaintiff in support of her motion, we cannot make a determination as to the actual amount of the fees to be awarded to plaintiff. Due to the plaintiff's failure to itemize the hours spent in furtherance of the $ 1,283.00 tax overpayment claim and to differentiate from those hours spent in furtherance of the other tax overpayment claims on which plaintiff did not prevail, we simply lack sufficient facts upon which to base an award of fees in a particular and certain amount. We refuse to speculate on so important an aspect of this fee award petition, and thus have no recourse but to deny the plaintiff's motion, without prejudice, with leave to amend within twenty (20) days. Entry of an award in the proper amount shall be made only upon submission of information adequate for a reasoned determination by this court.

 On Second Application For Attorney's Fees

 By Memorandum Opinion and Order of December 1, 1981, this Court determined that pursuant to the Equal Access to Justice Act, P.L. 96-481, 94 Stat. 2321, amending 28 U.S.C. § 2412, plaintiff was entitled to an award of attorney's fees and costs. Nevertheless, we denied plaintiff's application for such an award, without prejudice, and with leave to amend within twenty (20) days, because of plaintiff's failure to supply us with information sufficient to enable us to make an award only for those claims on which plaintiff prevailed, and not on those claims on which plaintiff did not prevail. A "Revised Statement of Services Requested By Order of Court" has been submitted by plaintiff, and an "Opposition" thereto filed by the United States. For the reasons which follow, we award plaintiff attorney's fees and costs in the amount of $ 761.09.

 The first step in determining the amount of a fee award is the calculation of the lodestar, or hours of service multiplied by the hourly rate. Lindy Brothers Builders v. American Radiator & Standard Sanitary Corp., 540 F.2d 102 (3d Cir. 1976) (Lindy II ); Lindy Brothers Builders v. American Radiator & Standard Sanitary Corp., 487 F.2d 161 (3d Cir. 1973) (Lindy I ). In calculating the number of hours of service, credit is given only for hours "reasonably supportive" of successful claims. Hughes v. Repko, 578 F.2d 483, 487 (3d Cir. 1978). "The burden of persuasion must rest on the petitioner to demonstrate to the Court the number of hours ...


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