Opinion
Civil Action No. 01-765 (CKK)(AK).
September 27, 2004
REPORT AND RECOMMENDATION
The above-captioned case was referred to the undersigned by Judge Colleen Kollar-Kotelly pursuant to Rule 72.3(a) of the Local Rules of the United States District Court for the District of Columbia for a Report and Recommendation on Plaintiff's motion for attorneys fees and expenses pursuant to the Equal Access to Justice Act, 28 U.S.C. § 2412 ("EAJA").
I. BACKGROUND
Plaintiff Hawaii Longline Association ("HLA") filed a single action lawsuit against Defendant the National Marine Fisheries Service ("NMFS") on April 10, 2001, alleging that actions taken by the NMFS violated the Endangered Species Act ("ESA"). Specifically, HLA claimed (1) that a biological opinion issued by NMFS in 2001 ("2001 BiOp") was `arbitrary and capricious' for not treating HLA as an `applicant' for purposes of the ESA consultation process that gave rise to the BiOp, (2) NMFS did not use the best available science in devising the 2001 BiOp, and (3) NMFS exceeded its jurisdiction in imposing a reasonable and prudent alternative ("RPA") on the Plaintiff in light of the prohibitions mandated by the BiOp.
On July 19, 2001, HLA filed a motion for partial summary judgment claiming that NMFS violated the ESA by not according HLA `applicant' status for purposes of consultation [14]. On November 15, 2001, HLA filed another summary judgment motion alleging other substantive defects in both the 2001 BiOp and the RPA contained therein [46]. NMFS responded substantively to the first summary judgment motion [57] and urged the Court to treat the second motion as moot because a superceding BiOp would issue from the NMFS within six months [131]. The NMFS promulgated permanent regulations ("June 2002 regulations") implementing the RPA contained in the 2001 BiOp. HLA then amended their complaint to add a challenge to the June 2002 regulations on the basis that it violated the Magnuson-Stevens Fishery Conservation and Management Act, 16 U.S.C. §§ 1801 et seq. ("MSA").
On September 24, 2002, the Court granted HLA's motion for partial summary judgment and vacated the 2001 BiOp and the included RPA [87] but stayed its ruling to allow NMFS to issue a replacement BiOp. The Court found, based on the April 25, 2002 Report and Recommendation by Magistrate Judge Facciola, that HLA was an applicant under the ESA and that the 2001 BiOp was procedurally defective because it not provide HLA the opportunities commensurate with `applicant' status.
HLA was entitled to comment because the 2001 BiOp had concluded that the HLA's activities jeopardized the continued existence of the green, leatherback, and loggerhead turtles. The 2001 BiOp thus set forth mandatory alternatives for the fishery.
On November 15, 2002, NMFS issued a replacement BiOp ("2002 BiOp"), which superseded the 2001 BiOp. Because the 2002 regulation, containing the restrictions under the 2001 BiOp, was in effect at the time the 2002 BiOp was issued, the NMFS was able to make a no jeopardy, `as regulated,' finding. As a result, the HLA was not entitled to comment on, or otherwise challenge, the 2002 BiOp. HLA amended its complaint yet again, adding a claim against the 2002 BiOp that it was substantively flawed because its RPA was `arbitrary and capricious." On August 31, 2003, the Court granted HLA's motion for summary judgment as to their second and third claims and denied the NMFS's cross motion for summary judgment. The Court held that the 2002 BiOp was arbitrary and capricious because the NMFS did not re-examine its conclusions from the 2001 BiOp in formulating the 2002 BiOp. Also, the Court found that the inability of HLA to challenge the substance of the 2002 BiOp through administrative procedures because the agency made a no jeopardy finding had effectively "insulated the substance of the 2001 BiOp from Court review." (8/31/03 Memorandum Order at 32.)
II. LEGAL STANDARD`
Under EAJA, an applicant can recover legal fees and expenses incurred in a lawsuit against the government if the applicant meets two threshold requirements: the applicant must be the `prevailing party' in the underlying action, the applicant must have incurred legal fees and expenses. 28 U.S.C. § 2412(d)(1)(A) If these requirements are met, the `prevailing party' is entitled to fees, "unless the Court finds that the position of the United States was substantially justified . . ." 28 U.S.C. § 2412 (d)(2)(B).
Entitlement to fees is subject to several limitations. No compensation is due for nonproductive time. Copeland v. Marshall, 641 F.2d 880, 891 (D.C. Cir. 1980). Redundant or excessive hours are not compensable. Hensley v. Eckerhart, 461 U.S. 424, 434 (1982). Similarly, no compensation should be paid for time spent litigating claims upon which the party seeking the fee did not ultimately prevail. Copeland, 641 F.2d at 891-92.
The applicant must submit an itemized statement from each attorney stating the actual time expended and the rate at which fees and other expenses were computed. 28 U.S.C. § 2412(d)(1)(B). Furthermore, an applicant is only entitled to an award for time reasonably expended. Thus the fee application must also contain sufficiently detailed information about the hours logged and the work done. National Assoc. of Concerned Veterans v. Secretary of Defense, 675 F.2d 1319, 1327 (D.C. Cir. 1982). The party seeking attorney fees bears the burden of establishing entitlement to an award and documenting the appropriate hours expended and hourly rates. Hensley, 461 U.S. at 437. Casual after-the-fact estimates of time expended on a case are insufficient to support an award of attorney's fees. Attorneys who anticipate making a fee application must maintain contemporaneous and standardized time records which accurately reflect the work done by each attorney. National Assoc. of Concerned Veterans, 675 F.2d at 1327.
III. DISCUSSION
A. Prevailing Party
HLA is a `party' under the EAJA as they are "an organization described in section 501 (c)(3) of the Internal Revenue Code." 28 U.S.C. § 2412 (d)(2)(B) (defining `party' as including non-profit corporations). Although the government does not dispute that HLA is a `prevailing party' with regard to the procedural grounds upon which the Court based its decisions, they do contest that HLA is a `prevailing party' as to the substance of the 2001 BiOp. (Opposition at 8.) Neither the text of the EAJA nor any cases in this jurisdiction define a party as the prevailing party specific to the particular argument or claims on which they prevail. Rather, the extent to which the party prevails is considered as a special factor used in determining the appropriate fee awarded by the court. See Infra at 10-13.
B. Substantial Justification
The prevailing party is entitled to fees, "unless the court finds that the position of the United States was substantially justified . . ." 28 U.S.C. § 2412 (d)(1)(A). The `position of the United States" under the statute includes both its "pre-litigation and litigation positions." Jacobs v. Schiffer, 204 F.3d 359 (D.C. Cir. 2000). The pre-litigation position of the United States includes "the action or failure to act by the agency upon which the civil action is based." 28 U.S.C. § 2412 (D). Thus, for purposes of determining whether the position of the United States was substantially justified, the undersigned must consider both the predicate actions of the agency as well as the agency's subsequent litigation position.
`Substantially justified' can have two distinct meanings. Pierce v. Underwood, 487 U.S. 552, 564 (1988). Substantially can either mean "considerable in amount, value, or the like" or it can mean "that is such in substance or in the main." (e.g. "what he said was substantially true.") Id. The Court has held that for purposes of the EAJA, it means the latter. Id. Therefore, notwithstanding the Plaintiff's many sound bites of the litigation history, and the Trial Court's characterization of the agency's actions, the undersigned will look generally at the position taken by the government to see if it is substantially justified and will consider, only as supporting evidence, the sound bites offered by Plaintiff or comments made by the Trial Court insofar as they address specifics to the litigation rather than general positions of the Defendant.
Contemporaneous to the NMFS' litigation with the HLA over the 2001 and 2002 biological opinions, the agency was engaged in litigation with the Center for Marine Conservation. Center for Marine Conservation v. NMFS, Civ. No. 99-00152 (D. Hawaii 2000). As the Trial Court observed, NMFS' position was sandwiched between those of the conservation groups and HLA (August 31, 2003 Memorandum Opinion at 4.) ("To borrow from a childhood fable, HLA contended that the 2001 BiOp was too hot; the Conservation Groups alleged that it was too cold; and NMFS claimed that it was just right").
In support of its application for attorneys fees, Plaintiff cites fifteen specific instances in which the Trial Court characterized the government's position unfavorably. The Defendant's opposition practically concedes that the agency's position was not substantially justified as it focuses mainly on the appropriateness of the assessed fee rather than whether an assessed fee is appropriate. The undersigned has conducted an independent review of the case history and cannot find that the government's position was substantially justified.
The government has squandered an opportunity to lead the undersigned through the complex history of this case and provide its interpretation of actions taken by the agency to support a finding that their position was, in fact, substantially justified. Absent this type of guidance, and the undersigned not being able to independently find that the government's position was substantially justified, the undersigned finds that fees are appropriate under the EAJA.
1. 2001 BiOp: Is HLA an Applicant?
The HLA's first complaint challenged the substantive and procedural validity of the 2001 BiOp. It was the position of the HLA that it is an `applicant' under the Endangered Species Act. ( See Complaint [1].) Again, the undersigned will consider concurrently the underlying justification for the agency's actions as well as its subsequent litigation position.
On September 24, 2002, the Trial Court adopted a Report and Recommendation from Magistrate Judge Facciola, holding that HLA is an "applicant" for purposes of interagency consultation under § 7 of the Endangered Species Act. Judge Facciola's Report and Recommendation found, and the Trial Court agreed, that NMFS' position with respect to whether HLA is an `applicant' was a post-hoc rationalization. (April 25, 2002 Report and Recommendation at 10.) This finding persuades the undersigned that the agency's action, in denying to the HLA applicant status, was not substantially justified. Furthermore, the arguments proffered by the Defendant in the litigation — that HLA is not an applicant — were "not very persuasive at all." (Id. at 13.) NMFS' arguments contradict its previous interpretations of the regulations and the Final ESA Section 7 Consultation Handbook published by NMFS. Furthermore, Magistrate Judge Facciola found that "NMFS' proposed narrowing of the scope of the action is inconsistent with its ordinary position." (Id. at 16.) In light of these findings, the undersigned does not find that the litigation position of the NMFS with respect to the 2001 BiOp was substantially justified.
Under § 7 of the ESA, federal agencies must engage in a consultation with NMFS or the U.S. Fish and Wildlife Service prior to authorizing any action that may affect listed species. 16 U.S.C. § 1536 (a)(2)-(b). Under the ESA, applicants are entitled to participate in this consultation process and in the formulation of RPAs, if necessary. Id.
2. 2002 Regulation and 2002 BiOp
The second major issue litigated in this case concerned the 2002 Regulations and the 2002 BiOp. Although the 2001 BiOp was invalidated by Court order, NMFS nonetheless chose to rely on the substance of the 2001 BiOp in formulating the 2002 Regulations and the 2002 BiOp. Since the Trial Court's decision was made on procedural rather than substantive grounds, the Defendant argued that the underlying science of the 2001 BiOp was still valid and therefore, that their reliance on that science was substantially justified. Although there is logic to the Defendant's position, the agency did not proffer any reasons, legal or otherwise, in support of this position. (See August 23, 2003 Opinion at 41.) In addition, "Defendants fail to explain how an unlawful biological opinion provides any legal basis for the continued application of the June 2002 Regulations." (Id. at 43.) Thus, while the actions of the agency were no doubt creative, and for a time successful in insulating the substance of the 2001 BiOp from Court review, (Id. at 32), ultimately, its actions in no way cured the procedural defects found by the Trial Court to exist in the 2001 BiOp, nor does it appear that any good faith attempt was made to do so. For example, NMFS employees discussed the issuance of the 2002 BiOp and stated that they "are not revisiting the original analysis (referring to the 2001 BiOp) and the original conclusions stand." (August 31, 2003 Memorandum Opinion at 27.) NMFS' apparent goal in taking this position was to avoid at all costs having to consider the arguments and suggestions made by HLA. Because the Trial Court found that HLA was entitled to treatment as an `applicant,' NMFS' position — continuing to deny HLA this opportunity — was not substantially justified.
IV. FEES UNDER EAJA
Under the EAJA, the prevailing party, absent a finding that the position of the United States was substantially justified, is entitled to "fees and other expenses, in addition to any costs awarded pursuant to subsection (a), incurred by that party in any civil action (other than cases sounding in tort), including proceedings for judicial review of agency action . . ." 28 U.S.C. § 2412 (d)(1)(A). The standard rate to be awarded for attorneys fees is not to exceed $125.00, "unless the court determines that an increase in the cost of living, or a special factor, such as the limited availability of qualified attorneys for the proceedings involved, justified a higher fee." Id. at (d)(2)(a). The "limited availability of qualified attorneys" means that the attorney possesses "some distinctive knowledge or specialized skill needful for the litigation in question — as opposed to an extraordinary level of the general lawyerly knowledge and ability useful in all litigation." Pierce v. Underwood, 487 U.S. 552, 572 (1988).
EAJA further states that fees and other expenses include reasonable attorneys' fees, reasonable expenses for expert witnesses, and reasonable costs of any study, analysis, etc., "necessary for the preparation of the party's case." 28 U.S.C. § 2412 (d)(2)(a). Thus, the Court must determine whether the fees and expenses incurred by the Plaintiff in the litigation of this case "were actually and reasonably expended." Role Models America, Inc. v. Brownlee, 353 F.3d 962, 970 (D.C. Cir. 2004).
A. Hensley v. Eckerhart
In Hensley v. Eckerhart, the Supreme Court reaffirmed the "`American Rule' that each party in a lawsuit ordinarily shall bear its own attorney's fees." 461 U.S. 424, 429 (1983). The Court construed the Civil Rights Attorney's Fees Awards Act as a limited departure from this first principle. Under the statute, the prevailing party "should ordinarily recover an attorney's fee unless special circumstances would render such an award unjust." Id. One such factor considered by the Court in limiting the award was the level of the prevailing party's success. Id. at 430. Thus, fees are appropriate for work spent on successful claims. Id. Conversely, "work on an unsuccessful claim cannot be deemed to have been `expended in pursuit of the ultimate result achieved.'" Id. at 434; Jacobs v. Schiffer, 204 F.3d 259, 264 (D.C. Cir. 2000) ("the relevant `position' of the government is that which corresponds to the claim or aspect of the case on which the private party prevailed.")
Although not specifically addressing attorneys fee awards under the Equal Access to Justice Act, the analysis in Hensley was "explicitly designed by the Court to apply to all federal statutes limiting fee awards to `prevailing part[ies].'" George Hyman Construction Co. v. Brooks, 963 F.2d 1532, 1535 (D.C. Cir. 1992) (holding that the Hensley analysis applied to Longshore and Harbor Workers' Compensation Act, 33 U.S.C. § 908 (a, c)).
The Hensley analysis can be applied in cases containing unrelated claims, such that a court, in determining the reasonable fees to be awarded, can separate the time and efforts spent on the successful claims from the time and effort spent on the unsuccessful ones. Hensley, 461 U.S. at 435 (holding that the statute "requires that th[e] unrelated claims be treated as if they had been raised in separate lawsuits, and therefore no fee may be awarded for services on the unsuccessful claim.")
Plaintiffs argue that, under Hensley, it is entitled to all fees incurred in the litigation because it achieved complete success on certain general claims. (Pl. Amended Reply at 3-4.) Under Plaintiff's interpretation of Hensley, the court should not consider whether the prevailing party has achieved success on particular issues within the litigation, but should credit the prevailing party generally for their successful claims. (Id.) The Plaintiff supports this assertion by citing Hensley: "Litigants in good faith may raise alternative legal grounds for a desired outcome, and the court's rejection of or failure to reach certain grounds is not a sufficient reason for reducing a fee." Hensley, 461 U.S. at 435. Plaintiffs' argument, while compelling, is incorrect.
Although the Hensley Court does distinguish between successful claims and unsuccessful claims, the Court, at other times, measures a party's entitlement to fees based on their success on a particular issue. Hensley, 461 U.S. at 433. The Hensley decision is predicated on the discretion that courts possess in awarding fees based on the "level of the plaintiff's success" and whether "special circumstances would render such an award unjust." Id. at 429. The principles established in Hensley are clear. First, the court must determine whether the party seeking fees is, indeed, the "prevailing party." Id. at 433. Then, "it remains for the district court to determine what fee is `reasonable.'" Id. In determining what fees are reasonable, "the most critical factor is the degree of success obtained," and one method for making that determination, if the claims are distinguishable, is to award fees for successful claims and deny them for unsuccessful claims. Id. at 436. It is only within the context of cases in which the individual claims are based on a "common core of facts or [are] based on related legal theories," that it becomes inappropriate for the Trial Court to attempt a "mathematical approach comparing the total number of issues in the case with those actually prevailed upon." Id. at 435.
Thus, under the EAJA, once a party is deemed to have prevailed, the door to the recovery of fees is opened. See Id. at 433. The degree to which it is opened should be measured, in large part, by the degree of success achieved by the prevailing party. See Id. at 436. When the prevailing party's claims are intertwined, the court's job of determining fees, based on the quantum of success, is murky and imprecise. See Id. at 435. Yet when the issues or claims are easily detached from one another, either because they involve a different factual nucleus or because they are based on different legal theories, the court's work is simplified, and the outcome a more precise measure of the degree of success. Id. To those issues upon which the party has prevailed, he is entitled to fees. To those issues upon which he did not prevail, he is not so entitled. Id.
In cases in which claims cannot be easily compartmentalized, the lawsuit "cannot be viewed as a series of discrete claims. Instead the district court should focus on the significance of the overall relief obtained by the plaintiff in relation to the hours reasonably expended on the litigation." Id.
The Plaintiff's claims, while all arising from the same factual nucleus, each contain unique factual issues and novel legal theories. The Plaintiff's claims can be easily divided into those involving procedural, or legal issues, and those raising substantive, or scientific ones. Plaintiff's claim that the 2001 BiOp was procedurally defective in that the NMFS, prior to its adoption, did not undertake a review of the Plaintiff's scientific evidence or comments, is procedural in nature. Plaintiff's claim that the 2002 Regulations and the 2002 BiOp were arbitrary and capricious, is similarly procedural in nature. These claims are procedural because they challenge the process by which these decisions and regulations were created, rather than challenging their content. On the other hand, Plaintiff's claims that the 2001 and 2002 BiOps were scientifically invalid are substantive in nature, as they call into question the substantive content of the BiOps, not the procedure by which they were created.
The Trial Court held in favor of the Plaintiff as to its procedural claims against NMFS. Because these decisions were outcome determinative, the Trial Court never considered, nor were legal findings made regarding the complex scientific challenges made to the legitimacy of the Regulations and BiOps. Indeed findings on the substantive legal validity of the 2001 and 2002 BiOps have never been made. Under Hensley, therefore, the Plaintiff is entitled to attorney's fees and other expenses as they relate specifically to the procedural issues on which the Plaintiff prevailed and are not entitled to fees for time spent or incurred in litigating the substantive, or scientific, questions left unresolved by the Trial Court. The narrow procedural claims upon which Plaintiff prevailed, limit the extent of a reasonable recovery.
The unique facts of this case would make an award which fully compensated Plaintiff for time spent on both its procedural, as well as substantive claims, unjust. This case was resolved on findings of basic procedural irregularities with the agency's actions. The decision of Plaintiff's attorneys to conduct extensive research into the substantive issues of this case was certainly diligent advocacy. "There is a point at which thorough and diligent litigation efforts become overkill." Role Models, 353 F.3d at 972. The undersigned finds that Plaintiff's extensive research in this case, prior to the Trial Court's determination of its "applicant" status, was premature. In its application for attorneys fees, Plaintiff argues persuasively that the government's position was not substantially justified by citing to numerous statements by the Trial Court as to the significant weaknesses in the government's arguments on the procedural matters in this litigation. (Pl. Application at 5-7.) So convincing is Plaintiff's argument in this regard, that it undermines the legitimacy of their decision to spend an immense amount of time on the more difficult and time-consuming substantive issues.
B. Plaintiff's Supplemental Request for Fees
In addition to the Plaintiff's initial request for fees, the Plaintiff has filed with the Court a supplemental application for fees incurred in the preparation of both the reply to the Defendant's appeal of the underlying decision in this case as well as for fees associated with the filing of the application for attorney's fees. See Commissioners, Immigration and Naturalization Service v. Jean, 496 U.S. 154, 162 (1990).
First, with regard to the appeal filed in this case, it is clear that the position of the government was not substantially justified, as the government voluntarily dismissed their appeal. See Toucher v. Rainer, 292 F.Supp. 2d 111 (D.D.C. 2003).
Second, with regard to preparation of the application for fees under the EAJA, this circuit has expressly upheld the validity of such a request. Cinciarelli v. Reagan, 729 F.2d 801 (D.C. Cir 1984).
The government's opposition to Plaintiff's supplemental application focuses on the amount to be awarded. The government argues that the amount of time devoted to these causes by the Plaintiff are patently unreasonable. To the contrary, the Plaintiff has adequately demonstrated the work product associated with this request and the reasonableness of the hours requested. The Plaintiff has not demonstrated, however, why it should be reimbursed at an hourly rate higher than that established by the EAJA. The attorney hours spent challenging the defendant's appeal, as well as drafting Plaintiff's application for fees are well within the competency of a typical lawyer who does not have any specialized training. See Truckers United for Safety v. Mead, 329 F.3d 891 (D.C. Cir. 2003). Thus, while the undersigned accepts the quantity of hours proffered by the applicant Plaintiff, the undersigned does not find that enhancement is warranted.
V. RECOMMENDATION
The Plaintiff's fee petition does not distinguish between the time spent on the procedural issues from the substantive issues.
The undersigned recommends that Plaintiff be awarded fees for the time spent preparing for and litigating the procedural issues upon which the Plaintiff prevailed.
Thus, the undersigned recommends that the Plaintiff file with the Court a pleading detailing the hours spent on the procedural issues in this case within five days of the Court's order and that the Government be given an opportunity to respond within five days thereafter.
Additionally, the undersigned recommends that the Defendant be ordered to pay Plaintiff $27,167.70 which is the sum total of the expenses incurred by Plaintiff and attorneys fees in preparation of its initial EAJA application and in litigating against the Defendant's appeal.
These figures were provided by Plaintiff in its Supplemental Application for An Award of Attorneys Fees [168].
VI. REVIEW BY THE DISTRICT COURT
The parties are hereby advised that under the provisions of Local Rule 72.3 (b) of the United States District Court for the District of Columbia, any party who objects to the Report and Recommendation must file a written objection thereto with the Clerk of this Court within 10 days of the party's receipt of this Report and Recommendation. The written objections must specifically identify the portion of the report and/or recommendation to which objection is made, and the basis for such objections. The parties are further advised that failure to file timely objections to the findings and recommendations set forth in this report may waive their right of appeal from an order of the District Court that adopts such findings and recommendation. See Thomas v. Arn, 474 U.S. 140 (1985). If this Report and Recommendation is served on the parties by mail, calculation of the time period for filing written objections is as follows: 10 business days (excluding weekends and holidays) plus three calendar days (including weekends and holidays). See CNPq-Conselho Nacional De Desenvolvimento Cientifico E Technologico v. Inter-Trade, Inc., 50 F.3d 56, 58 (D.C. Cir. 1995) (per curium).