Equal Access to Justice Act

• Author: William Funk - Jeffrey S. Lubbers
• Pages: 511-552

511

EQUAL ACCESS TO JUSTICE A CT

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Equal Access

to Justice

Act

511

Citations:

5 U.S.C. § 504, 504 note (2012) and 28 U.S.C. § 2412, 2412 note (2012);

enacted October 21, 1980, as title II of the Small Business Export Expansion

Act of 1980, Pub. L. No. 96-481, 94 Stat. 2325; amended September 3,

1982, by Pub. L. No. 97-248, title II, § 292, 96 Stat. 574; August 5, 1985, by

Pub. L. No. 99-80, 99 Stat. 183; October 21, 1986, by Pub. L. No. 99-509,

title VI, § 6103(c), 100 Stat. 1948; November 10, 1988, by Pub. L. No. 100-

647, title VI, § 6239(b), 102 Stat. 3746; October 29, 1992, by Pub. L. No.

102-572, § 506, 106 Stat. 4506, 4513; November 16, 1993, by Pub. L. No.

103-141, 107 Stat. 1489; December 21, 1995, by Pub. L. 104-66, title I, Sec.

1091(b), 109 Stat. 722; March 29, 1996, by Pub. L. No. 104-121, 110 Stat.

862; Jan. 4, 2011 by Pub. L. No. 111-350, § 5(a)(1), 124 Stat. 3841.

Lead Agencies:

General oversight: Office of the Chief Counsel for Advocacy, U.S. Small

Business Administration, 409 Third Street SW, Washington, DC 20416, (202)

205-6533. The Administrative Conference of the United States (ACUS) was

given reporting responsibility for administrative proceedings. Although ACUS

was not funded from 1996-2010, since its reopening it has begun reporting

again on a voluntary basis. Its report for FY 2010 was released in January

2013. The Administrative Office of the United States Courts was originally

given reporting responsibility for judicial proceedings. The Attorney General

was substituted in 1992, but this provision (28 U.S.C. § 2412(d)(5)) was

deleted in 1995. The ACUS report for FY 2010 does contain data on court

decisions. See Bibliography.

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Overview:

Eligibility and Coverage. The Equal Access to Justice Act provides that

certain parties who prevail over the federal government in covered litigation

are entitled to an award of attorneys’ fees and other expenses unless the gov-

ernment can demonstrate that its position was substantially justified or that

special circumstance would make an award unjust. The parties eligible to

receive such awards include individuals whose net worth (at the time the

adjudication was initiated) is not more than $2 million; businesses, organiza-

tions, associations, or units of local government with a net worth of no more

than $7 million and with no more than 500 employees; and tax-exempt orga-

nizations and agricultural cooperatives with no more than 500 employees,

regardless of net worth. This must be shown by adequate affidavits. See Al

Ghanim Combined Group Co. Gen. Trad. & Cont. W.L.L. v. United States, 67

Fed. Cl. 494 (Fed. Cl. 2005); see also Tri-State Steel Construction Co. v.

Herman, 164 F.3d 973 (6th Cir. 1999) (corporate subsidiary may qualify for

recovery under the EAJA, even if it is owned by a parent far too substantial to

fit below the net worth limitations). The 1996 Amendments also allow “a

small entity” (as defined in the Regulatory Flexibility Act, 5 U.S.C. § 601(6))

to utilize the new “excessive demand” avenue of relief (see discussion below

in “showing required”).

The Act covers two groups of proceedings: (1) adversary administrative

adjudications, which are defined to include formal hearing proceedings un-

der 5 U.S.C. § 554 (other than licensing and ratemaking proceedings, but

including license suspension or revocation proceedings) in which the agency

takes a position as a party at the proceeding, government contract appeals

adjudicated under the Contract Disputes Act of 1978 (41 U.S.C. §§ 601–

613), administrative civil penalty proceedings under the Program Fraud Civil

Remedies Act (31 U.S.C. Chapter 38), and hearings under the Religious Free-

dom Restoration Act of 1993; and (2) civil court actions other than tort cases

(not including tax cases, which are covered by a separate attorneys’ fee pro-

vision1). The Act also authorizes the award of attorneys’ fees against the

United States in those limited situations in which fees could be awarded

against any other party under existing common law and statutory provisions,

unless a statute expressly prohibits such an award.

126 U.S.C. § 7430. This provision applies to cases commenced after Febru-

ary 28, 1983. Tax cases (other than those in the Tax Court) pending on October 1,

1981, or commenced between that date and March 1, 1983, are covered by the

Equal Access to Justice Act.

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EQUAL ACCESS TO JUSTICE A CT

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Determining what constitutes an administrative proceeding “under” sec-

tion 554 has created some controversy, particularly with respect to deportation

and other administrative immigration proceedings, which are conducted with

procedures equivalent to those required by section 554, even though they are

expressly exempted from the Administrative Procedure Act’s requirements.

The U.S. Supreme Court resolved this issue, ruling that proceedings must be

“subject to” section 554 to fall within the Act’s coverage (and thus that admin-

istrative deportation proceedings are not covered). Ardestani v. INS, 502 U.S.

129 (1991). In other contexts, many courts had already reached a similar con-

clusion. See, e.g., Friends of the Earth v. Reilly, 966 F.2d 690 (D.C. Cir 1992)

(EPA proceeding leading to withdrawal of authorization for state hazardous-

waste program authorization not an adversary adjudication where formal hear-

ing was provided voluntarily under agency regulations rather than required by

statute); Dart v. United States, 961 F.2d 284 (D.C. Cir. 1992) (Export Control

Act proceedings not covered by EAJA because exempt from § 554 of APA); St.

Louis Fuel & Supply Co. v. FERC, 890 F.2d 446 (D.C. Cir. 1989) (Department

of Energy proceedings not covered by EAJA where formal hearing was pro-

vided voluntarily); Haire v. United States, 869 F.2d 531 (9th Cir. 1989) (De-

partment of Commerce enforcement proceedings under the Export

Administration Act not covered by EAJA because specifically exempted from

§ 554 by statute); Owens v. Brock, 860 F.2d 1363 (6th Cir. 1988) (Department

of Labor proceedings under the Federal Employees Compensation Act not cov-

ered by EAJA); Olsen v. Dep’t, of Commerce, Census Bureau, 735 F.2d 558

(Fed. Cir. 1984) (Merit Systems Protection Board proceeding concerning em-

ployee tenure not covered by EAJA); Smedberg Machine & Tool, Inc. v. Donovan,

730 F.2d 1089 (7th Cir. 1984) (labor certification review at Department of

Labor not covered by EAJA). Other courts have found particular adjudications

to meet the Ardestani test. Five Points Road Joint Venture v. Johanns, 542 F.3d

1121 (7th Cir. 2008) (adjudications conducted by hearing officers in the USDA’s

National Appeals Division are (1) adjudications required by statute, (2) on the

record, (3) with an opportunity for an agency hearing, and are thus covered by

the EAJA under the Ardestani test); Lane v. USDA, 120 F.3d 106 (8th Cir.

1997) (same), and Collard v. U.S. Department of Interior, 154 F.3d 933 (9th

Cir. 1998) (although statute governing extinguishing of mining patent did not

expressly call for formal APA adjudication, an APA hearing was constitution-

ally required; thus under Wong Yang Sung v. McGrath, 339 U.S. 33 (1950), the

hearing was governed by § 554 for the APA, making plaintiffs eligible for

EAJA reimbursement).

The Supreme Court has significantly narrowed the definition of “pre-

vailing party” in federal fee-shifting statutes. In Buckhannon Board & Care