PUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
ROBERT B. REICH, SECRETARY OF
LABOR,
Plaintiff-Appellant,
v.
WALTER W. KING PLUMBING &
HEATING CONTRACTOR, INCORPORATED,
Defendant-Appellee,
and
WALTER W. KING; EVELYN R. KING;
No. 95-2603
WALTER W. KING PLUMBING &
HEATING CONTRACTOR, INCORPORATED
MONEY PURCHASE PENSION PLAN;
WALTER W. KING PLUMBING &
HEATING CONTRACTOR, INCORPORATED
PROFIT SHARING PLAN; WALTER W.
KING PLUMBING & HEATING
CONTRACTOR, INCORPORATED BENEFIT
TRUST; LYNN MARTIN,
Defendants.
Appeal from the United States District Court
for the District of Maryland, at Baltimore.
William N. Nickerson, District Judge.
(CA-92-2116-WN)
Argued: July 10, 1996
Decided: October 11, 1996
Before RUSSELL, WIDENER, and HALL, Circuit Judges.
_________________________________________________________________
Affirmed by published opinion. Judge Russell wrote the majority
opinion, in which Judge Widener joined. Judge Hall wrote a dissent-
ing opinion.
_________________________________________________________________
COUNSEL
ARGUED: Elizabeth Hopkins, UNITED STATES DEPARTMENT
OF LABOR, Washington, D.C., for Appellant. James Allan Roth-
schild, ANDERSON, COE & KING, Baltimore, Maryland, for
Appellee. ON BRIEF: Thomas S. Williamson, Jr., Solicitor of Labor,
Allen H. Feldman, Associate Solicitor for Special Appellate and
Supreme Court Litigation, Nathaniel I. Spiller, Counsel for Appellate
Litigation, UNITED STATES DEPARTMENT OF LABOR, Wash-
ington, D.C., for Appellant. E. Scott Conover, ANDERSON, COE &
KING, Baltimore, Maryland, for Appellee.
_________________________________________________________________
OPINION
RUSSELL, Circuit Judge:
The Secretary of Labor (the "Secretary") appeals an award of attor-
neys' fees and expenses under the Equal Access to Justice Act, 28
U.S.C. § 2412(d)(1)(A), arising out of an action brought by the Secre-
tary against Walter W. King Heating and Plumbing Contractor, Inc.
("King Plumbing"), its employees' benefits plans, and the plans'
trustees. We affirm the award of attorneys' fees and expenses.
I.
In 1976, King Plumbing established a profit-sharing plan and a
pension plan (collectively, the "Plan") for its employees.* Walter W.
King and Evelyn King were the trustees of the Plan, and King Plumb-
ing was the Plan's sponsor.
_________________________________________________________________
*In 1990, the King Plumbing Profit Sharing Plan and the King Plumb-
ing Money Purchase Plan were merged into one plan, entitled the King
Plumbing Benefit Trust.
2
Beginning in 1983, Walter King, who has substantial knowledge
and experience in the real estate market in western Maryland, began
investing the Plan's assets in residential real estate mortgages, primar-
ily in Frederick County. King reviewed each application for a mort-
gage loan, met with each borrower personally, and visited each
property. He based the interest rate for the mortgage loans on the pre-
vailing rates from local banks. Almost all of the mortgages were short
term (five-year balloon) residential mortgages, amortized over 25
years. Most of the mortgages were for less than $100,000, and did not
exceed 80% of the value of the property. Between 1985 and 1993, the
Plan made approximately 83 mortgage loans, most of them for resi-
dential property in Frederick, Maryland.
During the period between June 30, 1984, through June 30, 1993,
the Plan averaged better than a ten percent return, grew from
$1,513,334 to $4,762,178, paid out benefits in excess of $1.5 million,
and never had a return less than 8.67% in any single year. Of the
loans made from the Plan's assets, only two defaulted but the Plan
recouped the entire amount of principal, interest, and costs in foreclo-
sure proceedings.
Because of the high percentage of assets invested in real estate
mortgages, the Secretary began investigating King Plumbing in Octo-
ber 1990. The Secretary concluded that King Plumbing failed to
diversify appropriately the assets of its Plan, in violation of
§ 404(a)(1)(C) of the Employee Retirement Income Security Act of
1974 ("ERISA"), 29 U.S.C. § 1104(a)(1)(C). It also concluded that
King Plumbing had engaged in transactions prohibited by § 406(a)(1)
(D) and § 406(b)(1) of ERISA, 29 U.S.C. §§ 1106(a)(1)(D) & (b)(1),
by using the Plan's assets to make mortgage loans to individuals who
used the loan proceeds to purchase land owned by King Plumbing and
to pay King Plumbing to build homes on the land.
On July 29, 1992, the Secretary filed suit against King Plumbing,
Walter and Evelyn King, and the Plan itself (collectively, "King
Plumbing" or "the defendants"). The Secretary's complaint alleged
both that the defendants had engaged in forty-seven prohibited trans-
actions and that the investment of the Plan's assets failed to meet the
diversification requirements of ERISA.
3
On December 7, 1993, the defendants deposed James Carroll, the
government agent who had investigated King Plumbing. According to
Carroll's testimony, he concluded that the Plan's mortgages consti-
tuted prohibited transactions because Evelyn King told him that the
Plan had made mortgages to individuals who used the proceeds to
purchase land owned by King Plumbing and to pay King Plumbing
to build homes on the land. Carroll, however, knew that Mrs. King
did not have personal knowledge of the nature of the mortgages. Fur-
thermore, he made no review of the mortgage loans and land records
to verify that King Plumbing owned the land prior to their being sub-
ject to the Plan's mortgages.
In February 1994, the parties settled the prohibited transaction
claims. Although King Plumbing did not admit that it had engaged in
any prohibited transactions, it agreed not to make loans from the Plan
to be used for the purchase of property or services from King Plumb-
ing. In return, the Secretary dismissed the forty-seven prohibited
transaction claims against King Plumbing.
On the remaining claim for non-diversification, the district court
denied cross-motions for summary judgment, and it held a bench trial
on September 26, 1994. Richard Hinz, the Chief Economist and
Director in the Office of Research and Economic Analysis for the
Pension and Welfare Benefits Administration of the Department of
Labor, testified as an expert witness for the Secretary. Hinz concluded
that the Plan's lack of diversification was imprudent because the Plan
could have achieved the same return with fewer risks by investing in
Ginnie and Fannie Mae pooled mortgages. He also testified that the
Plan could suffer large losses due to default risk, interest rate risk,
inflation risk, and liquidity risk. However, Hinz had not investigated
any of the particular loans in the Plan's portfolio, but based his analy-
sis on general economic and investment theories.
The defendants called three expert witnesses: David E. Brock, the
president of the Bank of Brunswick in Brunswick, Maryland; Alfred
J. Morrison, a private investment management consultant; and Wil-
liam G. Psillas, an employee benefit consultant. Brock provided the
best testimony for the defendants. He had analyzed each of the loans
in the portfolios and in many cases visited the properties themselves.
He concluded that the concentration of the Plan's assets in local resi-
4
dential loans did not create a risk of large losses. He based his opinion
on the loans' low loan-to-value ratios, the fact that the loans were 5-
year balloon mortgages, the good payment histories of the borrowers,
and Walter King's knowledge of the local real estate market. Brock
also testified that 60% of his bank's assets are invested in similar
mortgage loans in the same geographic area, and that the loans are
marketable. Brock also noted that the Plan received an 8.93% return
on investments, 0.1% higher than his bank's return.
The district court entered judgment in favor of the defendants on
November 17, 1994. Reich v. King, 867 F. Supp. 341 (D. Md. 1994).
The district court noted that ERISA required a plan's fiduciary to
diversify the plan's investment "unless under the circumstances it is
clearly prudent not to do so." 29 U.S.C. § 1104(a)(1)(C). The district
court held that the defendants had met their heavy burden of proving
that their non-diversification was prudent under the circumstances,
and that the defendants had offered "convincing and credible evidence
that the Plan does not face the risk of large losses due to non-
diversification." Id. at 344. The district court found Brock's testimony
particularly compelling because, of all the experts, only he had
reviewed the particular loans at issue. The court discounted the testi-
mony of Hinz, which it found was based on "textbook type theories
that appeared far removed from the actual realities of mortgages in
Frederick County." Id. at 345. The Secretary did not appeal the dis-
trict court's decision.
On November 30, 1994, King Plumbing filed a motion for an
award of attorneys' fees and expenses under the Equal Access to Jus-
tice Act, 28 U.S.C. § 2412(d)(1)(A). The district court granted the
motion on August 3, 1995, and awarded attorneys' fees in the amount
of $51,648.00 and expenses in the amount of $3,947.15. The Secre-
tary has appealed the award of attorneys' fees and expenses.
II.
The Equal Access to Justice Act provides:
Except as otherwise specifically provided by statute, a court
shall award to a prevailing party other than the United States
fees and other expenses . . . unless the court finds that the
5
position of the United States was substantially justified or
that special circumstances make an award unjust.
28 U.S.C. § 2412(d)(1)(A). The party seeking fees bears the burden
of proving that it was the prevailing party. The government, however,
bears the burden of showing that its position was substantially justi-
fied. Thompson v. Sullivan, 980 F.2d 280, 281 (4th Cir. 1992). We
review the district court's award of attorneys' fees and expenses
under an abuse of discretion standard. Pierce v. Underwood, 487 U.S.
552, 557-63 (1988).
A.
We turn first to the district court's decision to award attorneys' fees
and expenses on the prohibited transaction claims. In challenging this
award, the Secretary argues that King Plumbing was not the prevail-
ing party in the settlement of the prohibited transaction claims, and
that the Secretary's position on those claims was substantially justi-
fied.
1. Prevailing party
The district court found that King Plumbing was the prevailing
party in the settlement of the prohibited transaction claims because it
secured the dismissal, with prejudice, of the claims without conceding
that it had committed any prohibited transactions. In return, King
Plumbing merely agreed not to engage in any future prohibited trans-
actions. In other words, the Secretary dismissed the forty-seven
claims against King Plumbing in exchange for its promise to do what
it was already legally required to do: adhere to ERISA. The district
court stated that "[i]t is difficult to imagine how King Plumbing could
have fared any better."
The Secretary claims that it prevailed in the settlement because it
gained the right to institute contempt proceedings against King
Plumbing if it engaged in prohibited transactions in the future.
ERISA, however, has already created a cause of action to remedy pro-
hibited transactions. The power to bring a contempt action merely
duplicates the ERISA cause of action and does nothing to improve the
6
Secretary's ability to enforce ERISA. Neither remedy is effective
unless the Secretary can prove that King Plumbing actually engaged
in prohibited transactions, which the Secretary could not do with
respect to any of the forty-seven transactions identified in the com-
plaint.
We conclude that the district court did not abuse its discretion in
finding King Plumbing to be the prevailing party in the settlement.
2. Substantial justification
The district court found that the Secretary's position on the prohib-
ited transaction claims was not substantially justified because the Sec-
retary based his charges on a single, unverified statement made by
Evelyn King. Evelyn King told a government investigator that King
Plumbing had made mortgage loans from the Plan to individuals who
then used the proceeds to purchase land owned by King Plumbing and
to pay King Plumbing to build homes on the land. Although the
investigator knew that Mrs. King did not have personal knowledge of
the nature of the mortgages, but merely processed the loan payments
and handled the bookkeeping, the investigator made no examination
of the mortgage loans. The Secretary agreed to settle the prohibited
transaction claims after the investigator revealed during his deposition
that Mrs. King's statement constituted the entire basis of the Secre-
tary's claims.
The government insists that Mrs. King's statement is extremely
strong evidence of an ERISA violation because she was a trustee of
the Plan. We disagree. Although Mrs. King had the title of trustee, the
government investigator knew that Mr. King made all of the financial
decisions and that Mrs. King performed only ministerial functions.
The investigator should have verified Mrs. King's statement by exam-
ining the individual mortgage loans. The district court did not abuse
its discretion in concluding that the Secretary should have conducted
a more thorough investigation before bringing prohibited transaction
charges against King Plumbing.
The Secretary also contends that the evidence it gathered during
discovery specifically identified two loans as constituting prohibited
transactions. Even if the government did find evidence supporting two
7
prohibited transactions, it does not provide a compelling reason to
alter the district court's judgment. The Secretary brought sweeping
charges against King Plumbing, alleging that it had engaged in forty-
seven prohibited transactions. After discovery, the Secretary found no
evidence to support the charges with respect to forty-five of the forty-
seven transactions. The Secretary did not amend its complaint to limit
its prohibited transaction claims to the two mortgage loans on which
it found evidence of impropriety. The Secretary admitted that it did
not amend its complaint because it was in the middle of settlement
negotiations with King Plumbing and it did not want to weaken its
bargaining position. Even so, the Secretary entered a settlement
agreement in which King Plumbing did not admit to having engaged
in any prohibited transaction. Whatever evidence the Secretary found
to support its prohibited transaction claims, we conclude that the dis-
trict court did not abuse its discretion in discounting it.
The Secretary also contends that Walter King admitted at trial that
he had engaged in one prohibited transaction. The gist of King's testi-
mony, however, was that he took money out of the Plan in 1983 to
finance a construction job, learned that such an action was prohibited,
and did not do it again. The Secretary's prohibited transaction charges
are based on transactions that occurred between 1985 and 1990. Thus,
King's admission bears no relation to the mortgage loans that form
the basis of the Secretary's prohibited transaction claims.
We conclude that the district court did not abuse its discretion in
finding that the Secretary's position on the prohibited transaction
claims was not substantially justified.
B.
We next turn to the district court's decision to award attorneys'
fees and expenses on the lack of diversification claim. Because it is
clear that King Plumbing was the prevailing party on this claim, the
Secretary argues only that its position was substantially justified.
ERISA requires a plan's fiduciary to diversify the plan's invest-
ments "unless under the circumstances it is clearly prudent not to do
so." 29 U.S.C. § 1104(a)(1)(C). The district court found that the Sec-
retary adopted the position that the King Plumbing's lack of diversifi-
8
cation was a per se violation of ERISA because of the inherent risks
in mortgage loans. The district court held that the Secretary's position
was not substantially justified because he made no inquiry into the
specific facts and circumstances surrounding the Plan's investments.
The Secretary contends that the district court has mischaracterized
its position. He argues that he did not take the position that the failure
to diversify real estate investments was a per se violation of ERISA.
Instead, he maintains that he considered the specific circumstances
surrounding the Plan's investments and concluded that the concentra-
tion of assets in real estate mortgages in a single geographical area
exposed the Plan to the risk of large losses. Specifically, the Secretary
identified the following risks: the risk that a significant downturn in
the local economy could lead to widespread unemployment resulting
in borrower defaults and loss of property values (default risk); the risk
that a general rise in the interest rate would devalue the investments
or that a decline in interest rates would lead to widespread prepay-
ment by borrowers (interest rate risk); the risk that an increase in
inflation would devalue the investments and decrease their market-
ability (inflation risk); and the risk that a sudden, unexpected demand
for benefit payments by the beneficiaries would result in losses from
the inability to sell the mortgages at face value (liquidity risk).
The Secretary, however, did not identify any specific reasons sug-
gesting the likelihood of a significant downturn in the local economy,
a sudden change in interest rates, a drastic increase in inflation, or an
unexpected demand for benefit payments by the beneficiaries. The
Secretary did not examine any of the particular mortgages in the port-
folio to determine the risk of the Plan's investments. Hinz, the Secre-
tary's expert, relied on general assumptions to reach the general
conclusion that it is always imprudent to concentrate assets in real
estate mortgages in a single geographical area. Neither the Secretary
nor his expert examined the specific circumstances surrounding the
Plan's investments to determine whether King Plumbing's lack of
diversification was imprudent.
We conclude that the district court did not abuse its discretion in
finding that the Secretary's position on the diversification claim was
not substantially justified.
9
III.
For the foregoing reasons, we affirm the district court's award of
attorneys' fees and expenses.
AFFIRMED
HALL, Circuit Judge, dissenting:
The district court abused its discretion in ruling that King was the
prevailing party on the prohibited-transactions claims and that the
Secretary's position with regard to the diversification claims was not
substantially justified. I would, therefore, reverse the district court's
order granting attorney's fees to King.
I.
The district court ruled, and the majority agrees, that the dismissal
with prejudice of the prohibited-transactions claims, in return for
nothing more than King's "promise to do what it was already legally
required to do: adhere to ERISA," is enough to confer prevailing
party status on King because King "`could [not] have fared any bet-
ter.'" Ante at 6. This conclusion, however, is premised on an errone-
ous view of how the consent order affects the parties' future legal
relationship.1
A.
King, as the party moving for EAJA fees, had the burden of dem-
onstrating that it had prevailed. In order to be seen as the prevailing
party with regard to the prohibited-transactions claims, King had to
show that the settlement "materially altered" the legal relationship of
the parties and that the settlement, on balance, favored King. See
Roanoke River Basin Ass'n v. Hudson, 991 F.2d 132, 139 (4th Cir.),
cert. denied, 510 U.S. 864 (1993). Although we apply an abuse of dis-
_________________________________________________________________
1 The majority asserts that the Secretary could not prove that King "ac-
tually engaged in prohibited transactions . . . with respect to any of the
forty-seven transactions identified in the complaint." Ante at 7. The dis-
trict court, however, never made such a finding.
10
cretion standard to the district court's "prevailing party" determina-
tion, we review any predicate legal rulings de novo. See United States
v. 2116 Boxes of Boned Beef, 726 F.2d 1481, 1486 (10th Cir.), cert.
denied, 469 U.S. 825 (1984).
The analysis should begin with an examination of what result each
party hoped to achieve. In his complaint, the Secretary claimed that
the Kings, in their roles as fiduciaries of the pension plans, had vio-
lated 29 U.S.C. § 1106(a)(1)(D) & (b)(1) by making mortgage loans
with plan assets to individuals who intended in turn to use the loans
to finance the construction of homes by the construction company
owned by the Kings. The relief requested was restoration to the plan
of any losses resulting from such violations (although the complaint
did not allege that losses had occurred). The Secretary also asked the
court to enjoin King "from violating ERISA [and] from lending plan
assets to customers of King Plumbing." From King's perspective as
defendant, the best possible outcome would have been dismissal of
the claims with prejudice, the quicker the better.
Had prohibited transactions been established, either through fact-
finding by the court or admission by King, 29 U.S.C.A. § 1109(a)
(West 1985) would have provided the following options to the court:
(1) make the responsible fiduciary personally liable for losses to the
plan, and (2) "such other equitable or remedial relief as the court may
deem appropriate, including removal of the fiduciary."2 Option # 1
was meaningless once the Secretary determined that there were no
losses from any of the loans made with plan assets. 3 Loss to the plan,
however, is not an element of the prohibited-transactions claims.
_________________________________________________________________
2 Under a general civil enforcement provision, 29 U.S.C.A.
§ 1132(a)(5) (West Supp. 1996), the Secretary may seek "to enjoin any
act or practice which violates any provision of[Subchapter I, which
includes § 1106(a)] or [ ] to obtain other appropriate equitable relief (i)
to redress such violation or (ii) to enforce any provision of [Subchapter
I.]"
3 It apparently came to light during the discovery phase of the litigation
that the Kings were also engaging in or had engaged in another type of
prohibited transaction by which the Kings would attempt to meet
ERISA's minimum funding obligations with non-cash contributions to
the plan. See Secretary of Labor's Opposition to Defendant King Plumb-
11
Option # 2, then, was the only source of relief. See Brock v.
Robbins, 830 F.2d 640, 647 (7th Cir. 1987) (injunctive relief appro-
priate despite lack of losses to plan). From the Secretary's perspec-
tive, the settlement -- an agreement by King to not violate the
prohibited-transactions statutes in the future4 -- embodies the fullest
measure of available relief. Most settlements involve some give and
take, and the Secretary's insistence on a concession of wrongdoing by
King (if in fact there had been any wrongdoing) would have served
no practical purpose. Under such circumstances, the Secretary would
have been derelict to insist on a trial when he could get all he wanted
in a settlement.
B.
Under the settlement, the district court retained jurisdiction "for the
purpose of enforcing the terms of this Consent Order." To say that
King "could not have fared better" ignores the significant differences
between seeking enforcement of an existing order and starting from
scratch with a new complaint. Should he come to believe that King
is engaged in violations of the terms of the settlement, the Secretary
need only move to enforce the order. Whether any of the 47 violations
alleged in the original complaint ever occurred would be immaterial;
the only question for the court would be whether the new violations
had been shown.
More significantly, the available relief would be expanded. Fines
for civil and criminal contempt might be awarded against the contem-
nor. See United States v. United Mine Workers of America, 330 U.S.
258, 302-04 (1947). An award of costs and attorney's fees to the Sec-
_________________________________________________________________
ing's Motion for Award of Attorneys' Fees and other Expenses, (Exhibit
D - Jan. 4, 1994, letter from Secretary's counsel discussing non-cash
contributions). Such contributions are violative of 26 U.S.C. § 4975(c)(1)
(A). See C.I.R. v. Keystone Consol. Industries, Inc., 508 U.S. 152 (1993).
Although the complaint was not amended to add such a claim, the con-
sent order includes King's agreement not to make or receive such non-
cash contributions in the future.
4 The requested removal of the fiduciary related only to the diversifica-
tion claims.
12
retary, not available under EAJA or ERISA in the context of an origi-
nal enforcement action under 29 U.S.C.A. § 1109(a), could be granted
under the court's inherent power to enforce its orders. See In Re Gen-
eral Motors Corp., 61 F.3d 256, 259 (4th Cir. 1995). Moreover, an
action to enforce an existing order would presumably proceed more
expeditiously relative to an enforcement action initiated by complaint.
A contempt action does not, as the majority asserts,"merely dupli-
cate[ ]" an original enforcement action. Ante at 6.
We all have the duty to obey the law. When the Kings signed the
agreement, however, violation of §§ 29 U.S.C.§ 1106(a)(1)(D) &
(b)(1) became virtually synonymous with contempt of the court, and
the price of disobedience rose considerably. The district court erred
in discounting the effect of the consent order. This error, which was
the cornerstone of its decision, leads me to conclude that the court
abused its discretion in according prevailing party status to King.
II.
Of course, King prevailed on the diversification claims, but that
takes care of only the threshold requirement for EAJA fees. To
recover fees, King had to also prove that the claims were not "sub-
stantially justified" and did not have "a reasonable basis both in law
and in fact." Pierce v. Underwood, 487 U.S. 552, 562 (1988). The
government's action need only be "justified to a degree that could sat-
isfy a reasonable person." Id. at 565. Review of the relevant criteria
-- the stage of the proceedings at which the merits were decided, the
views of other courts on the diversification issue, the merits of the
case against King -- leads me to conclude that the district court
abused its discretion in finding no substantial justification for the Sec-
retary's position.
The Secretary succeeded in making out a prima facie case of non-
diversification and, in so doing, he forced King to shoulder the heavy
burden of proving that it was "clearly prudent" not to diversify. 29
U.S.C.A. § 1104(1)(C) (West Supp. 1996). When as much as 77% of
a plan's assets are in mortgages, and 72% of those in a single county,
the statutory requirement of diversification is clearly not being ful-
filled under any reasonable interpretation of the statute. Indeed, as the
district court noted, even the Kings conceded that they had not met
13
the diversification requirements of § 1104. Reich v. King, CA No.
WN-92-2116 at 7 (D. Md.) (Aug. 17, 1994, Memorandum denying
cross-motions for summary judgment). In short, the case was a close
one.
Although no two diversification cases are the same, the Secretary
was able to cite numerous decisions in which courts had found viola-
tions flowing from concentrations of investments similar to those
under the King plan. See, e.g., Donovan v. Guaranty National Bank,
4 Emp. Benefits Cas. (BNA) 1686 (S.D. W. Va. 1983). King made
no comparable showing.
Unrebutted evidence demonstrated that ultra-safe investments in
government-insured mortgages would have brought comparable
returns without the associated risk. Nevertheless, the majority
approves of the district court's ruling that the Secretary's evidence
was inadequate because the government expert failed to examine the
particular mortgages in the plan's portfolio and failed to "identify any
specific reasons suggesting the likelihood" of any dangers that diver-
sification is designed to avoid. Ante at 9. But sharp increases in infla-
tion or interest rates and precipitous downturns in local economies
cannot often be predicted with any degree of accuracy, and that very
uncertainty is the reason ERISA requires that diversification be prac-
ticed so that the risk of large losses can be minimized. This remained
a close case on the merits throughout.
I have no doubt that Mr. King is an intelligent and conscientious
student of the local mortgage market; his success to date bears that
out. However, the Secretary is statutorily authorized to bring enforce-
ment actions to ensure the prudent operation of pension plans, and
diversification is a specific requirement of plan-asset management.
The majority opinion will no doubt dampen the Secretary's willing-
ness to pursue other plans where the assets are similarly concentrated.
In the long run, the losers will be the beneficiaries of the plans. EAJA
was intended to thwart government abuses, not to"chill the govern-
ment's right to litigate or to subject the public fisc to added risk of
loss when the government chooses to litigate reasonably substantiated
positions, whether or not the position later turns out to be wrong."
14
Roanoke River Basin Ass'n, 991 F.2d at 139. The purposes of EAJA
are disserved by this fee award.
I respectfully dissent.
15