Pierce v. Barnhart

United States Court of Appeals
Fifth Circuit
F I L E D
IN THE UNITED STATES COURT OF APPEALS
February 14, 2006
FOR THE FIFTH CIRCUIT
Charles R. Fulbruge III
Clerk

No. 05-50003

MICHAEL PIERCE

Plaintiff - Appellant

v.

JO ANNE B BARNHART, COMMISSIONER OF SOCIAL SECURITY

Defendant - Appellee

Consolidated with
No. 05-50242

DENNIS E KING

Plaintiff - Appellant

v.

JO ANNE B BARNHART, COMMISSIONER OF SOCIAL SECURITY

Defendant - Appellee

Appeals from the United States District Court
for the Western District of Texas

Before JONES, Chief Judge, and KING and DENNIS, Circuit Judges.

KING, Circuit Judge:

In this consolidated appeal, the plaintiffs-appellants

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appeal the district court’s orders denying their applications for

attorney’s fees under the Equal Access to Justice Act (“EAJA”),

28 U.S.C. § 2412(d), and under 42 U.S.C. § 406(b). We affirm the

district court’s orders regarding attorney’s fees under the EAJA

and reverse and remand the district court’s orders concerning the

plaintiffs’ claims for attorney’s fees under § 406(b).

I. FACTUAL AND PROCEDURAL BACKGROUND

Plaintiffs Michael Pierce and Dennis King filed for

disability benefits under Titles II and XVI of the Social

Security Act on September 15, 1997, and May 28, 1998,

respectively. After Pierce and King pursued their claims through

the administrative process and were denied disability benefits,

each requested a hearing before an administrative law judge

(“ALJ”). Each was denied disability benefits by an ALJ, and the

appeals council affirmed the ALJ’s decision.

Pierce and King each filed a complaint in the United States

District Court for the Western District of Texas. Mary Ellen

Felps represented both plaintiffs before the district court and

continues to represent them in this court. The plaintiffs

consented to have the same magistrate judge decide their cases.

On April 4, 2003, in the case of Pierce, and April 2, 2003,

in the case of King, the magistrate judge reversed the ALJ’s

decision and remanded the case to the Commissioner of Social

Security (“Commissioner”) for further administrative proceedings

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on the plaintiff’s disability application.1 In each case, the

court’s remand order was entered pursuant to sentence four of 42

U.S.C. § 405(g)2 and did not award benefits to the plaintiff, but

did specifically contemplate further proceedings before the

Commissioner to determine whether the plaintiff was entitled to

benefits.

Pierce and King filed their first applications for

attorney’s fees on May 5, 2003, and April 22, 2003, respectively.

Each requested attorney’s fees under the EAJA, 28 U.S.C.

§ 2412(d), or attorney’s fees to be paid out of his past-due

benefits pursuant to 42 U.S.C. § 406(b).3 On May 23, 2003, the

1
The magistrate judge entered a judgment pursuant to FED.
R. CIV. P. 58 in each case.
2
Sentence four of § 405(g) provides that “[t]he court
shall have power to enter, upon the pleadings and transcript of
the record, a judgment affirming, modifying, or reversing the
decision of the Commissioner of Social Security, with or without
remanding the cause for a rehearing.” 42 U.S.C. § 405(g) (2000).
3
According to the Commissioner, “[a]ttorneys who
successfully represent Social Security benefits claimants in
court may be awarded fees under both the EAJA and the specific
provision found in 42 U.S.C. § 406(b), but the attorney must
refund to the claimant the amount of the smaller fee awarded. An
EAJA award offsets an award under § 406(b), so that the amount of
past-due benefits actually received by the claimant are increased
by the EAJA award, up to the point where [the] claimant receives
the full amount past-due.” Appellee’s Br. at 7 (citing Gisbrecht
v. Barnhart, 535 U.S. 789, 796 (2002)).
We also note that although Felps’s contracts (included in
the record excerpts on appeal) mention references to attorney’s
fees being payable under Titles II and XVI, attorney’s fees from
past-due benefits are not available under Title XVI but are
payable only under Title II. See 20 C.F.R. § 404.1703 (2005)
(noting that the “past-due benefits” that a claimant may recover
under § 406(b) “means the total amount of benefits payable under

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magistrate judge denied attorney’s fees to the plaintiffs without

prejudice. With regard to the plaintiffs’ applications for

attorney’s fees under the EAJA, the magistrate judge found that

the Commissioner’s position was substantially justified. The

magistrate judge also determined that the claims for attorney’s

fees under § 406(b) were premature because the plaintiffs had not

been found disabled or awarded benefits by an ALJ pursuant to the

administrative review called for in the magistrate judge’s remand

orders. Neither Pierce nor King appealed the magistrate judge’s

denial of his fee application.

On June 2, 2003, the Commissioner timely appealed the

magistrate judge’s April 2003 sentence-four judgments that

reversed and remanded the plaintiffs’ disability applications.

This court subsequently consolidated the two cases and scheduled

the cases for oral argument for the week of May 3, 2004. On

April 28, 2004, the Commissioner withdrew her appeals in the two

consolidated cases. The Commissioner apparently withdrew the

appeals after an ALJ had issued favorable decisions to the

plaintiffs pursuant to the April 2003 remand orders from the

magistrate judge. On April 29, 2004, this court dismissed the

consolidated appeal.

title II of the Act”); see also Bowen v. Galbreath, 485 U.S. 74,
77-78 (1988) (holding that the district court may not withhold a
portion of past-due benefits under Title XVI to pay attorney’s
fees incurred in judicial proceedings).

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 On July 1, 2004, Felps, on behalf of each plaintiff, moved

in the district court for entry of an order of remand. Felps

admitted in her motion that she was “uncertain procedurally what

steps [were] necessary to reinstate the case on the docket so as

to allow Plaintiff to petition for attorney’s fees under the

Equal Access to Justice Act . . . .” On July 15, 2004, in the

case of Pierce, and July 16, 2004, in the case of King, the

magistrate judge issued an order reaffirming the court’s prior

decision to reverse the ALJ and remand. The magistrate judge did

not issue an order of remand as requested by Felps; rather, the

magistrate judge determined, with regard to both plaintiffs, that

“[s]ince the Court of Appeals did not address the Court’s

Order[,] the Court is of the opinion that the Order remains in

effect” and that Felps’s requested orders were “unnecessary.”

On August 16, 2004, Pierce and King each filed a second

application for attorney’s fees under the EAJA and § 406(b). On

September 24, 2004, the magistrate judge issued orders denying

the plaintiffs’ second applications for attorney’s fees. In

these orders, the magistrate judge concluded that “[s]ince this

Court has already denied a very similar motion for attorney’s

fees and the circumstances in the case have not changed to

justify an award, Plaintiff’s Motion should be denied.”

Pierce and King each moved for a rehearing on the second

petition for attorney’s fees on October 4, 2004. In each

rehearing motion, Felps asserted that the court apparently

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misunderstood her previous request as an application for

attorney’s fees only under the EAJA. According to Felps, each

plaintiff was also requesting attorney’s fees pursuant to

§ 406(b).

Although the magistrate judge responded to the motions for

rehearing in separate orders (dated November 17, 2004 for Pierce

and February 1, 2005 for King), the magistrate judge denied each

motion for “at least four reasons.” First, the magistrate judge

concluded that the court had twice determined that Felps was not

entitled to recover fees under the EAJA and that the

circumstances in these cases had not changed to justify a

different result. Second, the magistrate judge concluded that

enforcement of an attorney-client contract would be improper

without first viewing the contractual provisions. According to

the court, Felps had not provided the court with a copy of the

contract. Third, the magistrate judge found that he was unable

to calculate attorney’s fees under § 406(b) because Felps had not

indicated whether attorney’s fees had been paid or were due to

other counsel for representation. Finally, the magistrate judge

determined that Felps’s requests for attorney’s fees were

“untimely” and Felps’s “dilatory conduct doom[ed] her

request[s].”

Pierce and King timely appealed. On July 18, 2005, this

court granted the Commissioner’s motion to consolidate the two

cases on appeal.

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 II. DISCUSSION

A. Attorney’s Fees Under the EAJA

The plaintiffs challenge the district court’s denials of

their August 16, 2004 applications for attorney’s fees under the

EAJA. According to the plaintiffs, they have met the statutory

requirements for bringing their EAJA claims and the district

court erred in concluding otherwise.

We first address whether the plaintiffs’ applications for

attorney’s fees were timely under the EAJA. An application for

attorney’s fees under the EAJA shall be submitted “within thirty

days of final judgment in the action.” 28 U.S.C. § 2412(d)(1)(B)

(2000). The EAJA defines “final judgment” as “a judgment that is

final and not appealable.” Id. § 2412(d)(2)(G). The Supreme

Court has interpreted “final judgment” for purposes of

§ 2412(d)(1)(B) as “a judgment rendered by a court that

terminates the civil action for which EAJA fees may be received.”

Melkonyan v. Sullivan, 501 U.S. 89, 96 (1991). According to the

Court, the thirty-day EAJA clock “begins to run after the time to

appeal that ‘final judgment’ has expired.” Id.

“Because this thirty-day deadline represents a waiver of

sovereign immunity, it is jurisdictional.” Briseno v. Ashcroft,

291 F.3d 377, 379 (5th Cir. 2002) (citing Clifton v. Heckler, 755

F.2d 1138, 1144-45 (5th Cir. 1985) (holding that “the statutory

time limitation, as an integral condition of the sovereign’s

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consent to be sued, is a jurisdictional prerequisite to an award

of fees under the EAJA”)). Thus, “a claimant’s failure to file

an EAJA application within this time constraint precludes a

district court from considering the merits of the fee

application.” Myers v. Sullivan, 916 F.2d 659, 666 (11th Cir.

1990). This court reviews the jurisdiction of the district court

de novo. See Briseno, 291 F.3d at 379 (citing United States v.

Sims Bros. Constr., 277 F.3d 734, 741 (5th Cir. 2001)).

In the present case, Pierce filed his initial application

for attorney’s fees on May 5, 2003, and King filed his initial

application on April 22, 2003. These initial applications were

premature. See Melkonyan, 501 U.S. at 102 (“In sentence four

cases, the filing period [for fee applications under the EAJA]

begins after the final judgment (‘affirming, modifying, or

reversing’) is entered by the court and the appeal period has

run, so that the judgment is no longer appealable.”). The

district court denied the applications. The plaintiffs did not

appeal the district court’s decisions to deny these initial

applications.

After the district court denied the initial fee

applications, the Commissioner filed appeals challenging the

district court’s underlying sentence-four remand orders. The

Commissioner withdrew her appeals, and on April 29, 2004, this

court dismissed these appeals. Thereafter, each plaintiff filed

a second application for attorney’s fees on August 16, 2004. The

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district court denied the plaintiffs’ second fee applications,

and it is the district court’s treatment of these second

applications that we must review to determine whether the

district court had subject-matter jurisdiction to entertain the

plaintiffs’ requests for EAJA attorney’s fees.

Several courts have held that a court of appeals’ order

dismissing a government’s appeal is a “final judgment” under

§ 2412(d)(1)(B), starting the thirty-day clock. In Keasler v.

United States, 766 F.2d 1227 (8th Cir. 1985), the government

timely appealed the district court’s adverse decision but later

dismissed the appeal. Id. at 1228. In deciding whether the

plaintiff’s application for attorney’s fees, which was filed nine

days after the government dismissed its appeal, was timely under

§ 2412(d)(1)(B) of the EAJA, the court found persuasive the view

of the Seventh Circuit in McDonald v. Schweiker, 726 F.2d 311

(7th Cir. 1983). Id. at 1229. In McDonald, the claimant moved

for attorney’s fees in the district court within thirty days

after the government dismissed its appeal. Holding that the

claimant’s motion for attorney’s fees was timely under the EAJA,

the Seventh Circuit concluded that “final judgment” means the

completion of all appellate proceedings. McDonald, 726 F.2d at

315. Concluding that the McDonald rule was “rightly decided[,]”

the Eighth Circuit in Keasler held that an “order dismissing the

government’s appeal is a final judgment under section

2412(d)(1)(B)[,]” which meant that the plaintiff’s application,

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filed within the thirty-day period, was timely under the EAJA.

Keasler, 766 F.2d at 1230-31; see also Myers, 916 F.2d at 671

(“When the government dismisses an appeal, the date of dismissal

commences the thirty-day period.”).

Although these appellate cases were issued prior to the

Supreme Court’s decision in Melkonyan, courts since that decision

have continued to view the thirty-day period as starting once the

government withdraws its appeal. In EEOC v. Mid-Minnesota

Federal Credit Union, 820 F. Supp. 432 (D. Minn. 1993), the EEOC

appealed the district court’s adverse order, but the appellate

court later dismissed the appeal after the EEOC withdrew its

appeal. The court stated that “[f]or purposes of EAJA, the

judgment became final when the court of appeals dismissed the

appeal because no further appeal of the court’s order could be

made.” Id. at 434. Because the claimant filed its motion for

fees more than thirty days after the appellate court dismissed

the appeal, the court concluded that it lacked jurisdiction to

award fees under the EAJA. Id.

In addition to the judicial decisions interpreting this

provision, legislative history also supports our view that the

thirty-day clock in these cases started when this court dismissed

the Commissioner’s appeals. When Congress added a statutory

clause defining “final judgment” under the EAJA as “a judgment

that is final and not appealable,” it included an example in the

legislative history indicating that the thirty-day period begins

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once the government dismisses its appeal. See H.R. REP. NO. 99-

120(I), at 22 n.26 (1985), reprinted in 1985 U.S.C.C.A.N. 132,

151 n.26 (“When the Government dismisses an appeal, the date of

dismissal commences the thirty-day period.”).

We hold that where, as here, the government dismisses its

own appeal, the date of dismissal commences the thirty-day

period. In the present case, the plaintiffs filed their

applications more than three months after this court dismissed

the government’s consolidated appeal. These applications, under

our holding, were clearly untimely under the EAJA, depriving the

district court of jurisdiction to consider the merits of the

applications.

In an effort to avoid being found “untimely” under the EAJA,

the plaintiffs contend that the magistrate judge’s orders

reaffirming his prior decisions4 were “final judgments” under the

EAJA, entitling them to new thirty-day periods to file their

requests for attorney’s fees. The magistrate judge, however, did

not issue orders of remand as requested by the plaintiffs.

Rather, the magistrate judge found these separate requests

“unnecessary,” concluding that his previous sentence-four

judgments in these cases remained in effect. Accordingly, the

magistrate judge merely reaffirmed his prior decision in each

case. To adopt the plaintiffs’ view would allow claimants, who

4
For Pierce, this order was dated July 15, 2004, and for
King, this order was dated July 16, 2004.

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are trying to meet the statutory requirements but have otherwise

failed to fall within the EAJA’s thirty-day period, to seek

orders reaffirming prior decisions in order to start new EAJA

filing periods. Because the plaintiffs’ interpretation of “final

judgment” is not supported by the decisions interpreting

§ 2412(d)(1)(B) and because it creates an incentive for claimants

to create new “final judgments” for purposes of the EAJA clock,

we decline to adopt this view. Instead, we hold that the

district court lacked subject-matter jurisdiction to consider the

plaintiffs’ applications for attorney’s fees under the EAJA.

Having reached this conclusion, we need not address the other

reasons adduced by the magistrate judge for his decision.

B. Attorney’s Fees Under § 406(b)

We next consider the plaintiffs’ arguments that the district

court did not show a proper legal basis for denying attorney’s

fees under 42 U.S.C. § 406(b). In so contending, each plaintiff

claims that the district court gave no reason for its finding

that counsel’s conduct was dilatory and there is nothing in the

record to support the court’s conclusion that his application was

untimely. As such, the plaintiffs contend that the district

court abused its discretion in denying fees under § 406(b).

Section 406(b) states:

Whenever a court renders a judgment favorable to a
claimant under this subchapter who was represented before
the court by an attorney, the court may determine and
allow as part of its judgment a reasonable fee for such

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 representation, not in excess of 25 percent of the total
of the past-due benefits to which the claimant is
entitled by reason of such judgment . . . .

42 U.S.C. § 406(b)(1)(A) (emphasis added). An award of

attorney’s fees out of past-due benefits is discretionary, and we

will not reverse a district court’s denial of attorney’s fees

under § 406(b) absent an abuse of discretion. See Damron v.

Comm’r of Soc. Sec., 104 F.3d 853, 856 (6th Cir. 1997) (“This

court will reverse a fee award decision upon finding an abuse of

discretion.”).

Unlike the EAJA thirty-day filing period, § 406(b) does not

contain a specific time period for the filing of attorney’s fees.

Although the Commissioner argues that there is no time period for

filing a petition for attorney’s fees under § 406(b), the

Commissioner’s view of the law is incorrect given that FED. R.

CIV. P. 54(d)(2) applies to any request for attorney’s fees

“[u]nless otherwise provided by statute or order of the court.”

See Shepherd v. Apfel, 981 F. Supp. 1188, 1190 (S.D. Iowa 1997)

(stating that because there is no time limit found in § 406(b)

regarding the timing of applications for attorney’s fees, the

time limit for such applications is governed by Rule 54(d) and

local rules); see also Jones v. Cent. Bank, 161 F.3d 311, 313

(5th Cir. 1998) (noting that local district court rules may

provide for a different filing period for attorney’s fees). The

local rules for the Western District of Texas follow FED. R. CIV.

P. 54(d)(2), which provides that claims for attorney’s fees shall

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be made by motion and that such “motion must be filed no later

than 14 days after entry of judgment . . . .” FED. R. CIV. P.

54(d)(2)(A)-(B); see W.D. TEX. CIV. R. 7(i)(1) (same fourteen-day

filing period as Rule 54(d)).

When the plaintiffs in the present case filed their initial

applications for attorney’s fees under § 406(b), the district

court denied those applications as “premature” because the

plaintiffs had not been found disabled or awarded past-due

benefits by an ALJ pursuant to the court’s sentence-four remand

orders. In denying § 406(b) fees, the magistrate judge ordered

“that Plaintiff[s’] Petition[s] for Attorney’s Fees [are] DENIED

without prejudice at this time, subject to being refiled should

Plaintiff[s] prevail on the merits of [their] claims.” In so

ordering, the district court gave the plaintiffs the opportunity

to refile their § 406(b) applications at a later date, even if

their refilings fell outside of the fourteen-day time period

prescribed by Rule 54(d) and the local rules. In essence, the

district court provided no time limitations for the plaintiffs’

second applications for § 406(b) attorney’s fees, which was well

within the court’s discretion under Rule 54(d). See FED. R. CIV.

P. 54(d)(2)(B) (providing for a fourteen-day period for filing

for attorney’s fees “[u]nless otherwise provided by statute or

order of the court”).

When the plaintiffs refiled their applications for

attorney’s fees under both § 406(b) and the EAJA on August 16,

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2004,5 the district court denied the EAJA applications, but did

not rule on, or even mention, the plaintiffs’ applications for

§ 406(b) attorney’s fees. It was only after Felps filed motions

for rehearing that the magistrate judge ruled that the

plaintiffs’ § 406(b) applications were “untimely” because: (1)

Felps waited “more than one year” to refile; (2) she did not

attach the attorney-client contracts at issue; and (3) she did

not indicate “whether fees have been paid, or are due, to any

other counsel for representation at the administrative level or

otherwise.”

Because the district court did not originally impose a cut-

off date on the plaintiffs to refile their applications, we think

the district court abused its discretion when it labeled the

plaintiffs’ second § 406(b) applications as “untimely.”6

As to the district court’s other reasons for denying

§ 406(b) attorney’s fees, the court also erred in faulting Felps

for not submitting the contracts or providing information on the

plaintiffs’ other legal representation. Rule 54(d) provides that

5
The Commissioner opposed the plaintiffs’ EAJA
applications but did not mention the requests for § 406(b) fees
in her opposition.
6
Although King had been found disabled and awarded past-
due benefits by an ALJ pursuant to the district court’s § 405(g)
remand order when Felps filed King’s second application for
attorney’s fees, Pierce had not. Thus, at the point Felps filed
Pierce’s second application, it was still “premature.” Now,
however, the application is no longer premature, and the district
court may consider whether § 406(b) attorney’s fees are
appropriate on remand.

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“[i]f directed by the court, the motion [for attorney’s fees]

shall also disclose the terms of any agreement with respect to

fees to be paid for the services for which claim is made.” FED.

R. CIV. P. 54(d)(2)(B) (emphasis added); see also FED. R. CIV. P.

54 advisory committee’s note (“If directed by the court, the

moving party is also required to disclose any fee agreement,

including those between attorney and client, between attorneys

sharing a fee to be awarded . . . .”) (emphasis added). The

local rules for the Western District of Texas similarly do not

require that counsel enclose a copy of the contract. See

generally W.D. TEX. CIV. R. 7(i). Instead, the local rules

require only that the motion for attorney’s fees include

supporting documents, which means a document indicating the dates

and hours spent on the project, an affidavit certifying that the

hours were actually expended by the attorney and are reasonable,

and a brief memorandum setting forth the method by which the fees

were computed, along with sufficient citation of authority. See

W.D. TEX. CIV. R. 7(i)(1). Upon review of the record, it appears

that Felps complied with the local rules in her requests for

attorney’s fees on behalf of the plaintiffs. Because Felps

complied with the local rules and the district court never

directed her to enclose the contracts, the district court abused

its discretion in denying attorney’s fees to Felps on the basis

that she never enclosed the agreements.

Accordingly, we reverse and remand the district court’s

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decisions to dismiss the plaintiffs’ applications under § 406(b)

as being untimely. In so ruling, we express no opinion on the

plaintiffs’ entitlement to attorney’s fees under § 406(b). See,

e.g., McGraw v. Barnhart, 370 F. Supp. 2d 1141 (N.D. Okla. 2005),

appeal docketed, McGraw v. Barnhart, No. 05-5079 (10th Cir. May

31, 2005).

III. CONCLUSION

For the foregoing reasons, we REFORM the district court’s

denials of November 17, 2004, in the case of Pierce v. Barnhart,

and February 1, 2005, in the case of King v. Barnhart, to be

dismissals of the motions for attorney’s fees under the EAJA for

want of jurisdiction, and as so reformed, the orders are

AFFIRMED. See Briseno, 291 F.3d at 380. We REVERSE the district

court’s denials of the plaintiffs’ applications for attorney’s

fees under 42 U.S.C. § 406(b), and REMAND for further

proceedings.

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