Hospice Center of Southeastern Oklahoma, Inc. v. Sebelius

Filing 51

ORDER by Judge Ronald A. White granting in part motion of the plaintiff for award of attorneys' fees ( 37 Motion for Attorney Fees ) (law, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT FOR THE
EASTERN DISTRICT OF OKLAHOMA
HOSPICE CENTER OF
SOUTHEASTERN OKLAHOMA, INC.,

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Plaintiff,
v.
KATHLEEN SEBELIUS, Secretary
of the U.S. Department of Health and
Human Services,
Defendant.

Case No. CIV-10-401-RAW

ORDER
Before the court is the motion of the plaintiff for award of attorneys’ fees. On August 11,
2011, the court entered judgment in favor of plaintiff, setting aside the challenged hospice cap
regulation. The 60-day period for appealing the judgment has expired and there is no dispute that
the present application was timely filed on November 9, 2011.
“The Equal Access to Justice Act (EAJA) [28 U.S.C. §2412(d)(1)(A)] provides for the
award of fees and expenses to the prevailing party in a civil action against the Federal
Government, unless the position of the United States was substantially justified.” Harris v. R.R.
Ret. Bd., 990 F.2d 519, 520 (10th Cir.1993). An agency position is substantially justified in this
context if it is “justified in substance or in the main – that is, justified to a degree that could satisfy
a reasonable person.” Pierce v. Underwood, 487 U.S. 552, 565 (1988).
Defendant objects to an award. First, the government notes that to qualify as a “party”
(and thus to be a prevailing party) under the Act, a corporation’s net worth must not exceed $7
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million and did not have more than 500 employees at the time the action was filed. See 28 U.S.C.
§2412(d)(2)(B). The government objects that plaintiff does not establish these requirements in its
original motion. Conceding the point, plaintiff in its reply has provided a declaration from its
Chief Financial Officer and a copy of plaintiff’s balance sheet as of October 28, 2010. These
documents indicate that plaintiff meets the statutory criteria at issue*. Defendant has not requested
leave to file a surreply; based on the present record, the court concludes plaintiff qualifies as a
prevailing party for purposes of the EAJA.
Defendant has not made an argument that its position was “substantially justified” under
the Act. The government bears the burden of establishing its position was so justified. See AlMaleki v. Holder, 558 F.3d 1200, 1207 (10th Cir.2009). Accordingly, this court makes the express
finding that it was not substantially justified.
Finally, the defendant objects to the amount of fees sought. Plaintiff seeks a total award
of $15,246.50, which represents attorney fees of $14,896.50 and court costs of $350.00. Under
the EAJA, the amount of fees is “based upon prevailing market rates,” but should not exceed $125
per hour “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 justifies a higher fee.”
28 U.S.C. §2412(d)(2)(A). Plaintiff argues that such an enhancement is appropriate here because
“its attorneys possessed specialized skills in Medicare law required in the case.” (Reply at 4).
The court finds this argument facially persuasive, but it appears the Tenth Circuit has
foreclosed this line of reasoning. In Chynoweth v. Sullivan, 920 F.2d 648, 650 (10th Cir.1990), the

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The declaration refers to 28 U.S.C. §2412(b)(2)(B)(ii). The correct citation is 28 U.S.C.
§2412(d)(2)(B)(ii).
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court said that expertise in Social Security law did not automatically entitle counsel to the fee
enhancement. The Second Circuit, citing Chynoweth, has made a similar ruling regarding
Medicare law. See Healey v. Leavitt, 485 F.3d 63, 69-70 (2d Cir.2007). The court is not
persuaded that plaintiff’s counsel has shown “the legal services rendered require[d] specialized
training and expertise unattainable by a competent attorney through a diligent study of the
governing legal principles.” Chynoweth, 902 F.2d at 650. Thus, the court declines to exceed the
statutory rate.
Further, the court takes judicial notice that the office of General Counsel, Region VI of the
Social Security Administration has provided hourly rates consistent with the yearly average CPI-U.
The General Counsel has previously approved hourly rates of $179 per hour for 2011 and $175
per hour for 2010 in this region.
The pleadings indicate a total of 19.1 hours for 2010 and 35.0 hours for 2011, for a total
of $9,607.50 for attorney fees and $350.00 for costs.
It is the order of the court that the motion of the plaintiff for award of attorneys’ fees (#37)
is hereby GRANTED in part as specified above.
IT IS SO ORDERED this 19th day of DECEMBER, 2011.

Dated this 19th day of December, 2011.

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