4th Circuit: Strong v. Commissioner of Social Security Administration- Equal Access to Justice Act

Summary: Ms.  Strong was denied Social Security disability benefits by an administrative law judge and appealed to the District Court, which remanded the case finding that the denial was not supported by substantial evidence.  The District Court, however, denied Ms.  Strong’s request for attorneys fees and costs pursuant to the Equal Access to Justice Act ("EAJA") at 28 U.S.C. § 2412. Under the EAJA   parties prevailing against the United State are entitled to attorney’s fees and costs ""unless the [district] court finds that the position of the United States was substantially justified." 28 U.S.C. § 2412(d)(1)(A).  A position taken by the United States is substantially justified so long as under the totality of the circumstances the government can show that  "a reasonable person could think it correct, that is, if it has a reasonable basis in law and fact." Pierce v. Underwood, 487 U.S. 552, 566 n.2.  (1988), See also  Hyatt v. Barnhart, 315 F.3d 239, 244-45 (4th Cir. 2002). Relying on Pullen v. Bowen, 820 F.2d 105, 108 (4th Cir. 1987), the Court of Appeals reiterated that a party is not entitled to attorney’s fees under the EAJA merely because the decision of an ALJ was not supported by substantial evidence. Commentary: On first blush, this opinion may not appear applicable in bankruptcy cases, it should be remembered that the EAJA has been held to apply to the United States Trustee (and presumably the Bankruptcy Administrator) in 707(b) dismissals.  See  In re Mendez,  2008 WL 5157922 (Bankr. D. N.M., 2008.),  In re Terrill,  2006 WL 2385236 (Bankr. N.D. Tex., 2006.)  It could also apply to disputes with the IRS, in student loan dischargeability cases with the U.S. Department of Education, or in mortgage strip-off opposed by HUD or other federal housing agencies. Strong v. Commissioner of Social Security Administration- Equal Access to Justice Act.PDF