Hylton v. SSA, 7:16-cv-00245

Plaintiffs were among ~1,787 claimants represented by attorney Eric Conn; Conn submitted tainted medical paperwork and bribed an ALJ to obtain favorable Social Security disability determinations.
After an OIG investigation, the SSA began redeterminations in 2015, directing ALJs to disregard medical evidence submitted by Conn and allowing claimants to supplement the record and request assistance.
ALJs conducting redeterminations denied benefits after excluding Conn-related evidence; claimants exhausted administrative remedies and sued challenging the redetermination process under the Social Security Act, the Due Process Clause, and the APA.
The Sixth Circuit (Hicks) held the SSA’s redetermination process violated due process and the APA and remanded the consolidated cases for further proceedings.
Plaintiffs then sought attorneys’ fees under the Equal Access to Justice Act (EAJA) after this Court’s sentence-four remands; the Court denied the fee motions because it found the Government’s position was substantially justified.

Issue	Plaintiff's Argument	Defendant's Argument	Held
Whether plaintiffs are "prevailing parties" under EAJA	Plaintiffs obtained remands under sentence four and thus prevailed	Government did not contest prevailing-party status	Held: Plaintiffs are prevailing parties
Whether the Government's position was "substantially justified"	SSA's redetermination violated Due Process and APA; fee award appropriate	Government argues its position had a reasonable legal and factual basis given fraud concerns and split authority	Held: Government's position was substantially justified; EAJA fees denied
Whether redetermination satisfied Due Process (Mathews balancing)	Redetermination deprived claimants of meaningful process by excluding evidence and limiting procedures	SSA reasonably excluded suspected fraudulent evidence, provided opportunities to supplement record, and balanced interests appropriately	Held: Although Sixth Circuit disagreed, the Court found the Government’s due-process position was reasonable and substantially justified
Whether SSA’s redetermination complied with APA (arbitrary and capricious / procedural requirements)	Plaintiffs argued certain aspects were arbitrary and capricious and that formal adjudication rules applied	Government argued its regulatory interpretation and procedures were reasonable and courts differed on applicability	Held: Even if one APA theory failed on review, other prominent APA/due-process theories were substantially justified; overall EAJA claim fails

Hicks v. Comm'r of Soc. Sec., 909 F.3d 786 (6th Cir. 2018) (describing Conn fraud scheme and holding SSA redetermination violated Due Process and APA)
Pierce v. Underwood, 487 U.S. 552 (U.S. 1988) (defines "substantially justified" standard under EAJA)
Jean v. Nelson, 496 U.S. 154 (U.S. 1990) (EAJA requires assessing government position as a whole)
Scarborough v. Principi, 541 U.S. 401 (U.S. 2004) (burden on government to show substantial justification)
Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep't of Health & Human Res., 532 U.S. 598 (U.S. 2001) (defines "prevailing party")
Howard v. Barnhart, 376 F.3d 551 (6th Cir. 2004) (EAJA substantial-justification analysis and relevant precedent)
Amezola-Garcia v. Lynch, 835 F.3d 553 (6th Cir. 2016) (EAJA application fails when distinct claims include a substantially justified prominent claim)
United States ex rel. Wall v. Circle C Constr., LLC, 868 F.3d 466 (6th Cir. 2017) (reasonableness and merits matter in substantial-justification inquiry)