D.C. Circuit Affirms NTSB's Rejection Of EAJA Fees When FAA Dismisses Its Complaint Before A Hearing
By Gregory J. Reigel
© July, 2010 All rights reserved.
In a recent decision, Turner and Coonan v. National Transportation Safety Board
, the D.C. Circuit Court of Appeals has affirmed the NTSB's refusal to allow two airmen to recover under the Equal Access to Justice Act ("EAJA") when the FAA dismissed its complaints before the cases can be heard by an NTSB administrative law judge ("ALJ"). The case began when the FAA suspended the airmen's airline transport certificates for their alleged operation of an aircraft that was in an unairworthy condition in violation of FAR 91.7(a)
. The airmen appealed the suspensions and their cases were assigned to the same ALJ who scheduled hearings for June 2008.
In April 2008 the ALJ granted motions to continue the cases and re-scheduled the hearings for August. However, after the continuance was granted, the FAA withdrew the complaints against the airmen, stating only: "The Administrator hereby withdraws its [sic] complaint in this matter." The ALJ then terminated the proceedings against the pilots with an short order that, unfortunately, did not specify whether the termination was with or without prejudice. The airmen then applied for an award of attorney's fees and expenses under EAJA.
The Equal Access to Justice Act
The EAJA is found at 5 U.S.C. 504
and is implemented in 49 CFR 826
. According to 49 CFR 826.1
, "The Equal Access to Justice Act, 5 U.S.C. 504 (the Act), provides for the award of attorney fees and other expenses to eligible individuals and entities who are parties to certain administrative proceedings (adversary adjudications) before the National Transportation Safety Board (Board). An eligible party may receive an award when it prevails over the Federal Aviation Administration (FAA), unless the Government agency's position in the proceeding was substantially justified or special circumstances make an award unjust." In order to determine whether EAJA fees are available, the key inquiries for an "applicant" (a certificate holder or target of a civil penalty action who is applying for an award of fees) are: (1) Is the Applicant a "prevailing party"? (2) Was the Applicant involved in an "adversary adjudication"? (3) Was the FAA’s position "substantially justified"? and (4) Were the fees actually "incurred" by the Applicant?
The Case Before The ALJ And The Board
The ALJ granted the airmen's EAJA requests finding that the airmen were prevailing parties as a result of the FAA's total withdrawal of all of the charges against the airmen. He also determined that the FAA was not substantially justified because it had "proceeded on a weak and tenuous basis with a flawed investigation bereft of any meaningful evidence." The FAA then appealed the decision to the full Board who reversed the ALJ's award. The Board concluded that the airmen did not satisfy the prevailing party standard because the airmen did not receive an enforceable judgment on the merits of their case, nor did they obtain a court-ordered consent decree that resulted in a change in the legal relationship between the airmen and the FAA.
Specifically, the Board found that the airmen did not prevail on any portion of the merits of the case because the FAA withdrew the charges before the ALJ could hold a hearing. It further noted that the ALJ's order dismissing the case merely accepted the FAA's withdrawal of the charges against the airmen and was not the same as a court-supervised consent decree. Finally, the Board observed that the ALJ did not dismiss the case with prejudice or in any way alter the relationship between the FAA and the airmen. The Board then concluded that "[w]e believe ourselves compelled to find that the Administrator’s withdrawal of the complaint does not confer prevailing party status on applicants under the EAJA."
The Court Of Appeals Affirms
On appeal to the D.C. Circuit Court of Appeals, the airmen argued that they were, in fact, the prevailing parties and entitled to the EAJA award granted by the ALJ. However, the Court concurred with the Board and concluded that the airmen were not prevailing parties. The Court found that the ALJ dismissed the cases without prejudice (meaning that the withdrawal did not prevent the FAA from trying to pursue its cases against the airmen at a later time). As a result, the Court held that the airmen did not receive any sort of "judicial relief." According to the Court, when the FAA unilaterally withdrew its complaints, the FAA ended its adversarial relationship with the airmen and the airmen were left in the same position they were in before the enforcement actions began.
In my opinion, this case is bad law. It places procedure before substance and is contrary to the legislative intent behind EAJA. Rather than deterring frivolous and unsubstantiated litigation by the FAA, the Court's decision certainly makes it more difficult to ensure that the FAA is justified in pursuing its cases. The decision also ignores the realities of litigation. To say that the airmen were simply in the same positions after withdrawal as they were before initiation of the action overlooks the time and expense necessarily incurred by the airmen in defending themselves in the case.
EAJA was enacted to allow recovery of those attorney's fees and expenses. Unfortunately, both the Board and the D.C. Circuit Court of Appeals have significantly impaired EAJA's deterrent effect, for now.