*1 judgment in vacating invalidity tion of error, I therefore dissent case is in
this rehearing in this the denial of in banc
from offer a defi-
appeal. I have not written to I problem.10 write
nite solution to justification for our I cannot find
because legally “poli- decision either or as
Vieau Further, repeatedly
cy”. this court has consideration to alter our
denied in banc question of precedent. The
“mootness” judgment invalidity on a declara-
how a finding treated after a
tory claim should be important my infringement no is too pass again. parties can
view to let Supreme Court for
now look
correction. TECHNOLOGIES, Dale INC. and Nathan, Plaintiffs-Appellants,
C. STATES, Defendant
The UNITED
-Appellee.
No. 91-5141. Appeals,
United States Court
Federal Circuit. 26, 1992.
Decided June Rehearing In Banc
Suggestion for July
Declined JNOV, Appeals for the Federal States Court of found the United took six months to write 30, 1992). very infringed patent (April and was invalid and not Circuit 65 my product. proud And when I read work See, e.g., Rooklidge appeals opinion so. and found that Others have done that court of vacated, Re, finding invalidity Judgments my Vacating Invalidity had been Patent controversy, I was in a was no case or there Non- Upon Appellate Determination for ten minutes. Soc’y state of shock infringement, Off. 72 J. Pat. & Trademark Cohn, Session at the Patent Breakout Remarks (1990). Annual Judicial Conference of the Tenth *2 pursuant
cation $26,731.59 the EAJA for in attorney fees and costs. FDL subse- quently petition filed a in bankruptcy on 2, July 1990, and is currently involved in bankruptcy proceedings.
The Army did not contest applica- FDL’s tion for attorney September fees. On 28, 1990, the contracting officer issued Con- tract P00006, Modification which increased рrice by contract $26,731.59,as full and final settlement of the EAJA claim. Be- Dale Nathan, C. cause the issue Associates, & of attorney Nathan fees was re- pro se. informally, solved the ASBCA never issued an order awarding attorney fees. ..When Kirchman, Robert E. Jr., Atty., Commer- FDL did not $26,731.59, receive the appel- cial Litigation Branch, Dept, Justice, lants filed complaint in the Claims Court Washington, D.C., submitted, for defen- 15, on November Nathan, had who dant-appellee. With him brief, on were been FDL’s attorney in the pro- ASBCA Gerson, Stuart M. Gen., Atty. Asst. David ceeding, signed complаint pro Ap- se. Cohen, M. Director and Sharon Y. Eu- pellants’ complaint sought judgment banks, Asst. Director. against the United States in the amount of $26,731.59, an award of pursuant interest NEWMAN, Before Judge, Circuit Prompt Payment Act, and an order SKELTON, Senior Judge, Circuit $26,731.59 directly to Na- ARCHER, Judge. Circuit than. Army asserts that on December ARCHER, Judge. Circuit Logistic the Defense (DLA) Agency issued a check FDL Technologies, FDL the full (FDL) Inc. amount and its of the attorney fees as Dale reflected in (Nathan) C. Nathan Con- appeal tract Modification P00006 and orders sent it to of the United States Claims “FDL Technologies, Baddin,” Mr. 8,1991 Court Albert July which on dismissed their FDL’s in bankruptcy. trustee Af- complaint 11,1991 on June denied their confirming ter this check was not claims that fees awarded to cashed, sent, the DLA and Mr. Baddin on pursuant FDL Equal Access to Jus- received, June the second check (EAJA), tice Act 504(a)(1)(1988), 5 U.S.C. § payable to “FLD Technologies Mr. [sic] should have been directly to Nathan Albert Attorney.” Baddin and that interest should been have allowed unpaid attorney fee pursuant In its first order of June to the Prompt Payment Act, 31 U.S.C. rejected Claims Court Nathan’s contention (1988). 3901-3907 Wе affirm. §§ fees should been
paid directly to him because it was “not Equal shown that the Access Justice Act BACKGROUND contemplates payments to other than May decision of the Arm- prevailing party.” In its second order is- ed Services Board of Appeals Contract sued day, the same the Claims Court de- (ASBCA) contracting determined that the nied claim Prompt Payment Act Department officer for the Army interest Prompt Payment “the because Act improperly terminated for default a apply con- does to a claim attorneys’ tract Army. between and the As EAJA since the item is not prevailing party, an appli- contemplation submitted within subject con- Corp. Appliance Co., `complete item, proper- v. Johnson Gas tract as a delivered (Fed.Cir.1990).
ty
`or service.'"
Based on these
two June
orders,
as well as the issuance
legislative
history
quot-
of the EAJA
FDL,
by appellants
fully supports
plain
the second check to
the Claims Court
*3
ed
July 8,
meaning
parrots
in its
1991 order concluded
that "all
statute.
It
prayed
complaint
by stating
the matters
for
in the
statute
that
the United States
is
accordingly
pay attorney
expenses
have now been resolved"
"to
fees and other
complaint.
prevailing
party
dismissed
to a
other
than the Unit-
agency
adjudi-
ed States
in an
adversarial
cation."
II.R.CONF.REP.
No.
DISCUSSION
Cong.,
(1980),
reprinted
2d Sess.
(empha-
1980 U.S.C.C.A.N.
I.
added).
sis
The first
issue in this case is whether
an
considering
comparable
In
fee
payment
shifting
provision
EAJA,
is entitled
to direct
under
prevailing
party
2412(d)(1)(A)
(1988),
§
to a
in an
this court con
agency adjudication
pursuant
EAJA,
Phillips
to the
cluded in
v. General
Services Ad
504(a)(1).
504(a)(1)
ministration,
(Fed.Cir.1991),
§
5 U.S.C.
Section
924 F.2d 1577
statеs,
pertinent
part:
payable
prevail
that a fee award is
ing party.
pro
in addition
agency
adversary
An
that
conducts
viding
shifting
agency
proceed
fee
adjudication
award,
prevailing
shall
to a
ings,
2412(d)(1)(A)
amended
28 U.S.C.
party
States,
other
than the United
provide
judicial
proceedings
that
"a
expenses
by
and other
incurred
prevailing
party
court
shall
award
to a
party
proceed-
in connection with that
than the United States
fees and other
ing....
[Emphasis
added.]
expenses
by
party"
(em
incurred
phasis
added).
Phillips
By
terms,
504(a)(1)
we held that
its
states
2412(d)(1)(A),
"attorney
under
could
fee
is made
to a
directly
party,
party's
claim or be entitled
award."
interest
Construction
v. United
justice....
States,
(Fed.Cir.1991).
7701(g)(1).
Similarly,
legis-
Thus, in interpreting
Prompt Payment
history
lative
attorney
CSRA
fee
Act, this
may
not enlarge the waiver
provision
require
does not
that fees be
sovereign
immunity beyond what the
to the prevailing party.
It states that
language
requires.
of the Act
Library
See
“[sjection
requires
agency
pay
7701©
Congress,
II. Thus, even if view the fee we as a contract, The second issue whether FDL correctly is enti- Court Claims deter tled to interest fee award Army’s obligation mined that the under the designed to are Fee-shifting statutes delivery of arise from contract did However, they have the the bar. not benefit Section 3902 оr services.
property encourag- practical effect intended and is not entitled apply and FDL suits meritorious attorneys to take on ing on the Payment Act to interest Prompt precarious finan- may be the client when award. finan- I need stress cial condition. AFFIRMED. Technologies, for the condition of cial speaks for itself. bankruptcy declaration NEWMAN, Judge, Circuit PAULINE govern- challenge to the Thus, when dissenting. the other is successful mental action 504(a)(1) met, are of the EAJA criteria dissent, sup- I can not respectfully paid. lawyеr will be assures that action of port improvident us, statutory purpose case before in the assured which the United agency’s refusal by the subverted was award, attorney fee circumstances attorney who the fee award would government, although paid by the fees, the client who or even to incurred the action Such never reach *5 party. prevailing was Equal to Justice required by the Access not of the purposes all of and defeated Act. Discussion provides Act Equal Access to Justice
The Technologies’ сlaim merits of and other attorney fees for by the Armed in FDL’s favor decided were in an party prevailing expenses May to on Appeals of Contract Forces Board position of unless the agency proceeding by coun- was 1990. FDL substantially justified or agency was attorney fees sel, paid neither FDL had but un- an award make special circumstances FDL’s by on counsel expenses nor 504(a)(1).1 Attorney fees just. 5 U.S.C. does not before us The record behalf. only from the are available FDL and arrangement between show the аn individual prevailing party is when its counsel. not net worth does whose or small business request for FDL filed On June specified limits. exceed expenses the amount found- 504(b)(1)(B). of fees is The award duly was $26,731.59. request The fee resources disparity “the between ed on contracting officer. On by granted and their expertise individuals peti- Technologies filed a July 1990 FDL legislative quoting from government,” 28,1990 September bankruptcy. On tion in H.R.Rep. No. EAJA. history of the a contract contracting officer issued Sess., 6, reprinted in Cong., 2d $26,731.59, in the amount modification Admin.News, Cong. & U.S.Code De- expenses. attorney fees and for fairness, also but purpose is not frequent requests apparently spite gov- challenge of unreasonable facilitate to made. none payment, agency for suc- done was here ernmental action—as 15,1990 Technologies words, November “fee-shift- On Congress’ cessfully. the Claims attorney filed suit in curbing ex- an instrument
ing becomes be made Court, payment requesting that ex- and the unreasonable regulation cessive agency an- attorney. The directly to the at authority” Id. ercise of Governmental February swer, on in the Claims Court filed at Cong. & Admin.News 12, 1980 U.S.Code payment had been that stated 4953, 4991. posi- agency of the finds cative officer 504(a)(1). conducts an ad- that An justified award, substantially agency was adjudication to a versary shall tion un- United an award party special than the make other circumstances that party in con- expenses incurred just.... adjudi- proceeding, unless the junction with made to the trustee bankruptcy, Mr. not, and can assert the trustee in Baddin, Albert on about December bankruptcy was party in the 1990. The trusteе in bankruptcy litigation did which attorney fees were receive payment. awarded. Thus the fees were neither to the prevailing party nor to the party that A replacement promised check was incurred the fees; the statutory require- the agency. FDL and its attorney contin- ments were met neither literally nor in request ued to payment directly to the at- their intent. torney. 7,May On 1991 the Claims Court issued an Order scheduling argument. can agree On with government’s June 1991 the trustee action. in bankruptcy Authority is on the side of avoiding check, received a to the order diversion of of “FLD attorney fees, they when are [sic] Technologies awarded, Mr. Albert to Baddin Attorney” recipients who had not in- at Mr. address, Baddin’s curred the fees. regional circuits, amount of $26,731.59. The well as the Circuit, Claims Federal Court then applied dis- suit, missed the the EAJA rejecting and other request fee-shifting statutes in ways designed assure the basis pay- Equal reaches attorney, Access to Justice Act order to does not avoid a “windfall”, “contemplatef as the payments opinions describe ] other than the it, рersons did not party”. actually incur the fees. Such cases have arisen in circum- The trustee in bankruptcy did stances where payment directly pre- the attorney fee award to vailing party could divert the payment *6 The attorney fee award was placed instead from the attorney. Indeed, this case in the bankruptcy estate, and the Minneso- ground breaks new in paying the fees nei- ta Bankruptcy Court subsequently denied ther to the party nor the attor- payment of attorney fees, the on the basis ney, but ato entity different that did not that the obligation was not secured. incur the fees. The only issue is whether the Claims No required court has pay- a mode of Court correctly held U.S.C. ment that the assured elimination pay- 504(a)(1) required, § law, as a matter of ment of awarded attorney fees to the attor- that the attorney fee award could not be ney. government’s The insistence on di- paid to the attorney and was correctly paid verting payment the full the amount of to the trustee in bankruptcy. There is no and expenses fees to the trustee in bank- raisеd, issue or side, reliance either ruptcy awas creditors, “windfall” to FDL’s upon the bankruptcy law. Whether that for neither FDL nor the trustee had ex- might law affect the result is not before us. pended this sum on FDL, behalf and question The sole is of interpretation one of neither had an entitlement to it. As a the Equal Access to Justice result, direct the attorney who incurred the whether that Act mandates the Claims expenditures is in the position same as if Court’s result. the fee award had never been made and paid. had never been government’s
The position is that the terms require the EAJA payment of Precedent shows that the courts have fees to the “prevailing par- followed a policy common sense of protect- ty”, and payment thus bar to the attorney. ing the statutory purposes of the fee government Thus the argues that it cor- award. The courts have not always or- rectly the refused contractor’s and at- paid dered directly to the attorney, torney’s request that the attorney fees be they but have so done when the circum- attorney, to the correctly instead stances showed to do otherwise would the trustee in payment or could defeat bankruptcy. government not, Although does there has been cited no in- case majority states that panel Although the bankrupt prevailing party, volving a 7701(g)(1) wording in between § difference ante the none, Ias observed found
we have
holding that
504(a)(1) supports its
bankrupt-
rely
on
does
government
made
504(a)(1)
can
entirely on
relies
government
cy laws.
have
courts
attorney,
Equal
directly
reading of the
literal
purported
a
courts
Other
interрreted
EAJA.
not so
Act.
Access to Justice
reasoning to the
same
applied the
literally, does
However,
read
Cir-
by the Federal
applied
as was
EAJA
in bank-
a trustee
payment to
not authorize
in
assure
7701(g)(1), order
cuit to §
party to
not a
ruptcy who was
Feder-
fees. The
attorney received
attorney fee award
litigation. The
the'
Jensen,
alone
not stand
al Circuit
any legal action
this case
unrelated
implies.
In-
bankruptcy.
trustee
involving the
Schweiker,
Cornelia
is threatened
deed,
contractor
when a
Cir.1984),
(8th
the court awarded
reason to
is additional
bankruptcy there
fact that
despite the
the EAJA
fees under
leg-
with
accordance
apply the EAJA‘in
pro
having been
applicant,
panel ma-
on
purpose. Based
islative
obli-
no fee
actually
bono, had
will be
decision,
shaky contractor
jority’s
paid to
gation.
counsel, no
obtain
indeed to
pressed
hard
party.”
“prevailing
attorney, not to
claim, for this
how meritorious
matter
of the
purpose
referred
The court
fees,
even
now
court
holds
effeсt
the deterrent
“to diminish
EAJA
nev-
will
government,
by the
when
of,
seeking
review
involved
expense
bankrupt con-
attorney of
er
reach
govern-
defending against, unreasonable
tractor.
at 981.
Id.
ment action.”
fee-,
jurisprudence
is extensive
There
Enterprises,
Amusement
In Miller
general-
The courts have
shifting statutes.
Cir.1970), the
(5th
Inc.,
im-
must
attorney fee awards
ly held
fee-shifting provision
construed
at-
statutory
purpose
plement
2000a-
Act, 42 U.S.C.
Rights
Civil
attorney, and
reach the
torney fees shall
*7
discretion, may
court, in its
3,
“the
wherein
did not
to others who
provide a windfall
а
party ...
reasonable
allow
rulings have
Such
fees.
incur
fee be
fee”,
that the
requiring
attorney’s
as
wording selected
of
niceties
on the
turned
Fifth
attorney. The
directly to the
paid
statutes.
various
drafters
by the
duty
a
courts have
stated
Circuit
Trans-
Department
v.
in Jensen
Thus
en-
fee award
to assure
(Fed.Cir.1988)this
721
portation,
attorney fees
but that
litigants,
rich the
un-
attorney fees awarded
held that
court
compen-
actually
government
by the
paid
Act, 5 U.S.C.
Reform
Service
the Civil
der
performed.
legal
services
sate
directly to the
paid
must be
7701(g)(1),
§
not so
enabling statute does
attorney. The
v. R. &
in Hairston
The Seventh Circuit
(7th
require:
Cir.
1090
F.2d
510
Apartments,
R.
un
attorney
awarded
fees
1975),
held
re-
may
Board ...
7701(g)(1).
...
Act,
42 U.S.C.
section
Housing
the Fair
der
agency involved
by the
quire payment
may
that fees
provided
3612(c) which
§
by an
fees incurred
attorney
reasonable
aof
the case
“in
awarded
be
if
employment
applicant
employee or
be
any “windfall”
to avoid
shall
plaintiff”,
employ-
applicant
or
employee
organiza
legal services
directly paid
party....
is the
ment
position
same
in the
“stands
which
tion
attorney direct-
paying
practice of
This
is owed.”
a fee
to whom
attorney
private
a
Pro-
Systems
by the Merit
initiated
ly was
Id. at
assure that
to
in order
Board
tection
Brandenburger v.
in
Ninth Circuit
is,
met,
to as-
purpose was
statutory
Cir.1974)
(9th
885, 889
F.2d
494
Thompson,
the fees.
received
attorney
sure
1585
held
attorney
fees awarded in a 42 in the assortment of fee-shifting
words
U.S.C.
equitable
1983 action on
grounds
§
statutes,
various
insofar
point
as the
here
shall “of course”
be
directly to the
at issue
concerned,
and no basis arises in
legаl
organization,
services
to avoid “a precedent
distinguish
to
among them.
In-
windfall to
litigant”.
In Maher v.
stead, the courts have acted reasonably,
Gagne,
122,
448 U.S.
100 S.Ct.
65 and justly, to place the awarded attorney
(1980),
L.Ed.2d 653
an attorney fee award
fees in the hands of the attorney who in-
under 42 U.S.C. 1988 was made directly
§
curred the expenditure, when the circum-
counsel,
to
on the following text:
stances warranted such action.
any
U.S.C. 1988. In
or pro-
action
also
question
raises a
ceeding to enforce
court,
[§ 1983]
the standing of
attorney
FDL’s
to seek
discretion,
its
may allow the prevailing
attorney fees. No such
us,
issue is before
party,
the United
other.than
and indeed has not been previously raised.
attorney’s
reasonable
fee....
Further, there is no merit
point.
Id. at
such
tained
action
addition to
EAJA
any judg-
plaintiff
his
plain-
own name.
Beck v.
tiffs,
Secretary
HHS,
allow a
reasonable
attorney’s fee
paid by
(Fed.Cir.1991).
be
defendant,
See
....
also Devine v. Nation
al Treasury Employees Union, 805 F.2d
explained
ruling
that the fees
cert,
(Fed.Cir.1986),
denied, 484 U.S.
should
directly
the attorneys:
108 S.Ct.
(1987)
L.Ed.2d 31
course,
Of
since the object of fee awards
(considering application for
EAJA
is not
provide
a windfall to individual
union that had
employ
plaintiffs, fee awards must accrue to ee). Although the circuits are not unani
counsel.
aspect, see,
mous on this
e.g., Oguachuba
at
Id.
Immigration
Serv.,
Naturalization
*8
(2nd
F.2d
Cir.1983)
706
98
(counsel
In Grand
Improvement
Boulevard
has
standing
alone
no
request
to
fees in
Ass’n v. City
553
Chicago,
F.Supp.
petition
connection with
for writ of habeas
(N.D.Ill.1982),
an EAJA fee award
corpus), there is no
issue
this case of
was
to
ordered
directly to
Legal
the
standing
fees,
to
attorney
seek
attorney
for
Assistance Foundation.
In Wedra v.
awarded,
fees were already
and
Thomas,
thе
F.Supp.
(S.D.N.Y.
disputed.
is not
1985),
Although
government
the
the court stated that
it would be
“foolish,
relies
heavily
Oguachuba,
imprudent”
if
it is out of
not
pay
to
an EAJA
point for the
attorney
award of
additional reason
fees to
that
inmates who
Technologies
party
were the
was
prevailing parties.
to the fee petition
and the suit.
Review the
variety
statutory texts
judicial
their
application
and
The
also
shows that the
relies on Panola
courts
have
Buying
Clark,
drawn
Land
distinctions based
Ass’n v.
844 F.2d
wording
on the
(11th
Cir.1988),
the various fee-shifting
which held that when
public
statutes. Nо nuances of
policy or
agreed by
the client
settlement
waive
congressional intent appear to be reflected
attorney
fees under the attor-
in
216(b);
“payment by
or
independent
right to make an
ney had no
attorney fees
of reasonable
Again,
issue is
volved
[if
fees.
that
claim for
party” in 5
any-
employee] is the
present, for no one has waived
here
legislative
7701(g)(1). The various
attorney fees U.S.C.
case at bar the
thing.
In the
support the delicate distinc
do not
neither the
histories
awarded and
were
—but
All of these fee-
fees,
here drawn.
tion that is
nor
attorney
who
purpose
shifting
have the same
par-
statutes
literally
was
client who
same mecha
operate according to the
ty.
legal
for
servic
payment of fees
nism: the
upon by
process insisted
The
Indeed,
legislative history
es rendered.
authority
government contravenes
against
“overly
cautions
of the EAJA
the attor
is to assure that
purpose
whose
Brew
of its terms.
technical construction”
expenditures re
incurred the
ney who has
Monuments
American Battle
еr v.
legal
services
the sums awarded
ceives
Comm.,
(Fed.Cir.
F.2d
1566-67
Phillips v. General Services
rendered.
Cong.,
1987), citing H.R.Rep. No.
Admin.,
quire a different support “plain meaning” rule does controlling dis- There is no a result.
such among, example, the words
tinction *9 prevailing party, other than
“may allow attorney’s a reasonable
the United and 42 U.S.C. in 42
fee” U.S.C. § 1973Z(e); any judgment or “in addition to plaintiffs, plaintiff or allow attorney’s fee” in 29 U.S.C.
a reasonable