United States District Court, Western District of Pennsylvania
November 25, 1991
MARIAN HUDSON, PLAINTIFF,
LOUIS W. SULLIVAN, SECRETARY OF HEALTH AND HUMAN SERVICES, DEFENDANT.
The opinion of the court was delivered by: Ziegler, District Judge.
Pending before the court are plaintiff's motion for the
entry of judgment for widow's disability benefits and a
petition by plaintiff's counsel for approval of attorney's
fees,*fn1 pursuant to the Equal Access to Justice Act
("EAJA"), 28 U.S.C. § 2412(d), and response of defendant. For
the reasons set forth below, we will grant the motion and
On June 7, 1983, plaintiff, Marian Hudson, filed an
application for widow's disability benefits based on the
earnings record of her deceased spouse. In a decision dated
March 25, 1985, the administrative law judge found that Hudson
did not have an impairment or combination of impairments equal
or medically equivalent to a listed impairment and denied
Hudson's claim for disability benefits. On September 5, 1985,
the Appeals Council denied review. Hudson filed suit in this
court and alleged that the Secretary's regulations and rulings
for determining such benefits violated the Social Security
Act, due process, and established law in this jurisdiction.
Hudson sought nationwide class certification.
In Hudson v. Sullivan, 717 F. Supp. 340, 351 (W.D.Pa. 1989),
we denied plaintiff's request for class certification. However,
we held that Social Security Ruling 83-19 ("SSR 83-19")
violated the Social Security Act and prohibited the Secretary
from considering Hudson's functional limitations when
determining whether her impairments were equivalent to the
requirements of impairments listed in 20 C.F.R. Appendix 1 to
Subpart P. We remanded to the Secretary to consider Hudson's
functional limitations when determining whether her impairments
met or equalled the requirements of listed impairments when
without applying the invalidated provision of SSR 83-19.
The Secretary considered, via the ALJ, additional material
evidence pertaining to Hudson's functional limitations and
impairments through the testimony of Richard M. Klein, M.D.
Dr. Klein testified that Hudson suffered from cervical
spondylosis and pain. The ALJ found that these impairments met
the severity requirements of listed impairments. Record at
435. On July 17, 1990, the ALJ awarded disabled widow's
benefits to Hudson, effective August 26, 1983, under § 202(e)
of the Social Security Act, 42 U.S.C. § 402(e). R. at 438.
However, the ALJ found that Hudson's impairments and all
resulting functional limitations did not meet or equal the
listed impairments before that date. R. at 437.
On April 10, 1991, almost nine months after the decision,
Hudson moved for the entry of judgment and her counsel filed
a petition for attorney's fees. On June 19, 1991, the
Secretary filed a supplemental transcript of proceedings on
remand which included the testimony of Dr. Klein, the new
findings of fact, and a decision.
The issues raised by the parties are (1) whether this court
entered final judgment on May 31, 1989, and therefore
counsel's EAJA petition was time barred after August 29,
1989;*fn2 (2) whether the equitable doctrines of tolling and
estoppel bar the Secretary's defense that the EAJA petition
was untimely;*fn3 (3) whether Hudson was a prevailing party
under the EAJA; and (4) whether the Secretary's position under
the EAJA was substantially justified.
The EAJA provides that "[a] party seeking an award of fees
and other expenses shall, within thirty days of final judgment
in the action, submit to the court an application for fees and
other expenses which shows that the party is a prevailing
party and is eligible to receive an award. . . ."
28 U.S.C. § 2412(d)(1)(A). Therefore, we must determine whether our
remand in Hudson constituted a final judgment under the EAJA.
Only two types of remands are permitted for actions under
42 U.S.C. § 405(g). "[R]emand orders must either accompany a final
judgment affirming, modifying, or reversing the administrative
decision in accordance with sentence four, or conform with the
requirements outlined by Congress in sentence six." Melkonyan
v. Sullivan, ___ U.S. ___, 111 S.Ct. 2157, 2165, 115 L.Ed.2d 78
Prior to Melkonyan, case law in this jurisdiction did not
require a plaintiff to file a fee petition until thirty days
after a district court entered final judgment and the appeal
period expired. In the present case, the Secretary argues that
Melkonyan must be applied retroactively and that our remand in
Hudson accompanied a final judgment pursuant to sentence four.
Conversely, Hudson contends that this court did not enter final
judgment because sentence six governed the remand, or in the
alternative, that Melkonyan must be applied prospectively.
Sentence four of § 405(g) provides that "[t]he court shall
have power to enter . . . a judgment affirming, modifying, or
reversing the decision of the Secretary, with or without
remanding the cause for a rehearing." 42 U.S.C. § 405(g). In
sentence four cases, the filing period begins after final
judgment is entered by the court and the appeal period has run,
so that the judgment is no longer appealable.
28 U.S.C. § 2412(d)(2)(G).
Sentence six of § 405(g) provides, in pertinent part:
The court may . . . at any time order additional
evidence to be taken before the Secretary, but
only upon a showing that there is new evidence
which is material and that there is good cause for
the failure to incorporate such evidence
into the record in a prior proceeding; and the
Secretary shall, after the case is remanded, and
after hearing such additional evidence if so
ordered, modify or affirm his findings of fact or
his decision, or both, and shall file with the
court any such additional and modified findings of
fact and decision, and a transcript of the
additional record and testimony upon which his
action in modifying or affirming was based.
42 U.S.C. § 405(g) (emphasis added).
"In sentence six cases, the filing period does not begin
until after the postremand proceedings are completed, the
Secretary returns to court, the court enters a final judgment,
and the appeal period runs." Melkonyan, 111 S.Ct. at 2165.
In the present case, the Secretary's consideration of
Hudson's functional limitations, via the ALJ, involved taking
additional material evidence pertaining to Hudson's
limitations and impairments. Although the ALJ did not consider
Hudson's limitations after August 26, 1983, there was good
cause for the failure to incorporate this evidence into the
original record, because the Secretary's application of SSR
83-19 prohibited consideration of Hudson's functional
limitations. Furthermore, our remand neither expressly
relinquished jurisdiction nor accompanied a judgment
affirming, modifying or reversing the Secretary's decision
under sentence four. Therefore, we hold that this case is a
sentence six case and enter judgment for Hudson pursuant to
Rule 58. Because plaintiff's counsel is not required to file
a fee petition until 90 days after the entry of judgment,
counsel's present fee petition is timely.
In applying Melkonyan to this case, we recognize that we must
retroactively apply a new rule of federal law after its
announcement. James B. Beam Distilling Co. v. Georgia, ___ U.S.
___, 111 S.Ct. 2439, 2446, 115 L.Ed.2d 481 (1991). When a new
rule of law, confined to a choice of law, is applied to
litigants in one case, it must be applied to all others not
barred by procedural requirements or res judicata. Id. 111
S.Ct. at 2448. Equality and stare decisis prevail over any
claim based on the analysis of Chevron Oil Co. v. Huson,
404 U.S. 97, 92 S.Ct. 349, 30 L.Ed.2d 296 (1971). Beam, 111 S.Ct.
at 2446. Therefore, retroactive application of Melkonyan is
required here. Fergason v. Sullivan, 771 F. Supp. 1008 (W.D.Mo.
1991); Audette v. Secretary of Health and Human Services,
776 F. Supp. 84, 90 (D.R.I. 1991); see Welter v. Sullivan,
941 F.2d 674, 675 (8th Cir. 1991).*fn4
The EAJA provides, in pertinent part:
A court shall award to a prevailing party other
than the United States fees and other expenses . .
. incurred by that party in any civil action . . .
brought by or against the United States in any
court having jurisdiction of that action, unless
the court finds that the position of the United
States was substantially justified or that special
circumstances make an award unjust.
28 U.S.C. § 2412(d)(1)(A) (emphasis added).
A "prevailing party" is one who fairly can be found by a
district court to have essentially succeeded on the claims for
relief. Brown v. Secretary of Health and Human Services,
747 F.2d 878, 883 (3d Cir. 1984). This focus is on the relief
received and not the substantive merits of a plaintiff's
claims. Bagby v. Beal, 606 F.2d 411, 415 (3d Cir. 1979). On
remand, a plaintiff must secure an award of benefits that was
originally sought on appeal to the district court. Milliron v.
Bowen, 708 F. Supp. 677, 678 (W.D.Pa. 1989).
In addition to obtaining the benefit sought, one can be a
prevailing party only if there is a causal relationship
action and the ultimate relief received. Sullivan v.
Pennsylvania Department of Labor and Industry, 663 F.2d 443,
448 (3d Cir. 1981), cert. denied, 455 U.S. 1020, 102 S.Ct.
1716, 72 L.Ed.2d 138 (1982). The central inquiry regarding a
causal-connection is "whether the plaintiff obtained the relief
sought `as a result of [his] judicial efforts, or whether these
efforts were a `material factor' in obtaining the relief."
Sullivan, 663 F.2d at 449. In determining whether causation is
shown, a district court is "bound to apply the most expansive
definition" of such causation. N.A.A.C.P. v. Wilmington Medical
Center, Inc., 689 F.2d 1161, 1169 (3d Cir. 1982), rehearing
denied, 693 F.2d 22 (3rd Cir. 1982), cert. denied,
460 U.S. 1052, 103 S.Ct. 1499, 75 L.Ed.2d 930 (1983).
In the present case, the ALJ awarded Hudson disabled widow's
benefits, effective August 26, 1983, based upon her
impairments. However, the ALJ found that Hudson's impairments
and resulting functional limitations did not meet or equal the
listed impairments before this date. Although Hudson prevailed
on a different theory of relief, she nevertheless succeeded on
a significant issue in litigation which achieved the benefit
that she sought. But for Hudson's lawsuit such benefit would
not have been recovered. The nexus between Hudson's lawsuit
and her subsequent recovery of benefits establishes that she
is a prevailing party. Therefore, we hold that Hudson's
recovery of benefits was not "as a result of" judicial
efforts; rather, the recovery was the result of her efforts on
remand which were a "material factor" in obtaining the
The Secretary contests the issue of substantial
justification because SSR 83-19 was tacitly approved by two
courts of appeals.*fn5 Such reliance by the United States is
substantially justified when it is proven to a degree that
would satisfy a reasonable person in both law and fact.
Pierce v. Underwood, 487 U.S. 552, 565, 108 S.Ct. 2541, 2550,
101 L.Ed.2d 490 (1988). The government bears the burden of
proof that its position is substantially justified under the
EAJA. Taylor v. Heckler, 835 F.2d 1037, 1042 (3rd Cir. 1987).
While objective indicia can be relevant, such as the views of
other courts on the merits, they do not conclusively establish
whether the Secretary's position was substantially justified.
Pierce, 487 U.S. at 569, 108 S.Ct. at 2552. We hold that the
Secretary failed to meet his burden of persuasion by mere
reliance upon the "tacit approval" of courts which did not
consider the merits of whether SSR 83-19 violated the Social
Finally, we note that the Secretary does not allege any
other special circumstances that make this award of attorney
fees unjust. Therefore, we hold that the fee of $10,203.75 for
107.25 hours of service at $95.00 per hour and $15.00 of FAX
expense is fair and reasonable in this instance, and
consistent with the requirements of the EAJA.*fn6
Although the EAJA defines the deadline for filing a fee
petition, plaintiffs may file petitions earlier and not wait
for a final judgment. Taylor v. United States, 749 F.2d 171,
175 n. 8 (3rd Cir. 1984). Premature filing for fees does not
prejudice a plaintiff's attorney. Melkonyan, 111 S.Ct. at 2166.
Therefore, in this instance, counsel need not file a further
supplement to the fee petition.