United States District Court, E.D. Michigan, Southern Division
BRADLEY A. CARDEW, Plaintiff,
COMMISSIONER OF SOCIAL SECURITY, Defendant.
OPINION & ORDER DENYING MOTION FOR ATTORNEY FEES
A. GOLDSMITH UNITED STATES DISTRICT JUDGE
15, Plaintiff Bradley A. Cardew suffered a severe spinal
injury that rendered him wheelchair-bound with C5-C6
quadriplegia. Despite his physical limitations, Cardew
attended Oakland University and worked briefly as a summer
intern in 2004 at the Lear Corporation, a position that his
cousin, a vice president at Lear, helped him secure. Eight
years later, when Cardew sought retroactive child disability
benefits, an ALJ denied his application, finding that
Cardew's highly-accommodated summer internship had been
substantial gainful activity, which precluded an award of
benefits. This Court affirmed that decision and Cardew
appealed to the Sixth Circuit. The Sixth Circuit found that
the ALJ had used “an incomplete and overly rigid legal
framework” to deny benefits and remanded the matter for
further consideration. Cardew v. Comm'r of Soc.
Sec., 896 F.3d 742, 751 (6th Cir. 2018). The parties
stipulated to a sentence-four remand and the case was sent
back to the ALJ.
now moves for attorney fees and costs under the Equal Access
to Justice Act (“EAJA”), 28 U.S.C. § 2412
(Dkt. 37), arguing that the Commissioner's denial of
benefits was not substantially justified. The Commissioner
filed a response brief in opposition (Dkt. 38). For the
reasons that follow, the Court concludes that the
Commissioner's position in this litigation and the
underlying action was substantially justified and, therefore,
Plaintiff's counsel is not entitled to an award of
attorney fees under the EAJA.
EAJA provides that “a court shall award to a prevailing
party . . . fees and other expenses . . . in any civil action
. . . brought by or against the United States . . . unless
the court finds that the position of the United States was
substantially justified or that special circumstances make an
award unjust.” 28 U.S.C. § 2412(d). The
“position of the United States” is defined as,
“in addition to the position taken by the United States
in the civil action, the action or failure to act by the
agency upon which the civil action is based.” 28 U.S.C.
§ 2412(d)(2)(D); see also Delta Eng'g v. United
States, 41 F.3d 259, 261 (6th Cir. 1994) (“The
government's ‘position' comprehends both the
United States' underlying action and its litigation
position.” (citations omitted)).
Commissioner's position is substantially justified if it
has a “‘reasonable basis both in law and
fact.'” DeLong v. Comm'r of Soc. Sec.
Admin., 748 F.3d 723, 726 (6th Cir. 2014) (quoting
Pierce v. Underwood, 487 U.S. 552, 565 (1988)). The
Commissioner's failure to prevail in the litigation
“raises no presumption that its position lacked
substantial justification.” United States v. Real
Prop. Located at 2323 Charms Rd., Milford Twp., Oakland Cty.,
Mich., 946 F.2d 437, 440 (6th Cir. 1991). “The
[Commissioner] bears the burden of demonstrating substantial
justification.” Sec'y of United States
Dep't of Labor v. Jackson Cty. Hosp., Inc., 215 F.3d
1327, at *3 (Table) (6th Cir. 2000) (citation omitted).
filed an application for child disability benefits after he
turned 22 years old. Therefore, under the regulations, any
substantial gainful activity after the age of 22 would
preclude him from receiving his retroactive child disability
benefits. See 20 C.F.R. §§ 404.350(a)(5),
404.1520(b), 404.1571, et seq. In 2004, monthly
earnings of more than $810 per month constituted substantial
gainful activity. Admin. Record (“AR”) at 15
(Dkt. 13). The ALJ calculated Cardew's summer internship
income under various calculations resulting in a monthly
income of somewhere between $900 to $1, 000 per month, which
exceeded the established regulatory substantial gainful
activity presumption. AR at 16-17. The ALJ explained that
this “bright line test” precluded eligibility for
child disability benefits and denied Cardew's benefits.
Sixth Circuit reversed the decision because the “bright
line test” leaving Cardew “technically ineligible
for child disability benefits, ” did not reflect the
flexible language of the regulations, which use terms such as
“may, ” “generally, ” and
“ordinarily.” Cardew, 896 F.3d at 750.
The Sixth Circuit reversed the ALJ decision because she used
“an incomplete and overly rigid legal framework,
” even though substantial evidence could arguably
otherwise support the decision. Id. at 750-751.
Therefore, the panel remanded the action to the ALJ to decide
the matter in the first instance. Id.
question here is whether the Commissioner's position was
not substantially justified such that EAJA fees should be
awarded. Cardew argues that the Commissioner's
position was not substantially justified where the ALJ failed
to take the special conditions under 20 C.F.R. §
404.1573(c) into consideration and she erroneously found that
Cardew's adjusted income was a dispositive finding. Mot.
¶ 7. The Commissioner argues that, in the absence of
guiding precedents, his position was substantially justified
because both the regulations and longstanding Social Security
policy called for the ALJ to quantify the “true
value” of Cardew's subsidized earnings. Resp. at 4.
Therefore, the Commissioner argues, his position had a
reasonable basis in law and fact. The Commissioner has the
better part of the argument.
alone is not a proper basis for EAJA fees. DeLong,
748 F.3d at 726. “This is so because the finding that a
denial of benefits was not supported by substantial evidence
is not tantamount to a determination that the
Commissioner's position lacked substantial
justification.” Id. Here, the ALJ's
decision was rooted in the facts and analyzed under the
correct legal standards, even though she applied an overly
rigid legal framework. This was a procedural rather than
substantive error. The Sixth Circuit has cautioned that
remand on procedural grounds may result in yet another denial
of benefits and might well be sustained on appeal.
Id. at 727. It would be an odd result to find that
the Commissioner's position was not substantially
justified but later affirm a denial of benefits. The
Commissioner's position was substantially justified
because it had a reasonable basis both in law and fact.
Therefore, Cardew's motion is denied
reasons stated above, Cardew's motion for attorney fees