**This version includes the errata dated 10Apr02 - e**

**UNITED STATES COURT OF APPEALS FOR VETERANS CLAIMS**

No. 97-2150

[Benny J. Flemming, Appellant]{.smallcaps},

[v.]{.smallcaps}

[Anthony J. Principi,]{.smallcaps}

[Secretary of Veterans Affairs, Appellee.]{.smallcaps}

On Appellant\'s Application for Attorney Fees and Expenses

(Decided April 4, 2002 )

*Mark R. Lippman*, of La Jolla, CA, was on the application for the
appellant.

*Tim S. McClain*, General Counsel; *Ron Garvin*, Assistant General
Counsel; and *Darryl A. Joe*, Acting Deputy Assistant General Counsel,
all of Washington, D.C., were on the response for the appellee.

Before IVERS, STEINBERG, and GREENE, *Judges*.

IVERS, *Judge*, filed the opinion of the Court. GREENE, *Judge*, filed a
concurring opinion. STEINBERG, *Judge*, filed an opinion concurring in
part and dissenting in part.

IVERS, *Judge*: On April 2, 1999, the Court, in a single-judge order,
vacated a July 29, 1997, Board of Veterans\' Appeals (Board) decision
and remanded the matter on appeal to the Board for readjudication. The
sole basis for the remand was a change in caselaw that had occurred
during the pendency of the appeal. *See* *Flemming v. West*, No.
97-2150, 1999 WL 219986 (Vet. App. Apr. 2, 1999); *see also Hodge v.
West*, 155 F.3d 1356 (Fed. Cir. 1998).

The appellant, through counsel, has filed an application for an award of
reasonable attorney fees and expenses pursuant to the Equal Access to
Justice Act (EAJA), 28 U.S.C. § 2412(d). The appellant\'s EAJA
application satisfies all EAJA jurisdictional and content requirements.
*See* 28 U.S.C. § 2412(d)(1)(B); *Sumner v. Principi*, 15 Vet.App. 256
(2001) (en banc). On October 5, 2001, the Court stayed this matter
pending the outcome of *Vaughn v. Principi*, 15 Vet.App. 277 (2001) (per
curiam), or further order of the Court. For the reasons that follow, the
appellant\'s EAJA application will be denied.

In order to be eligible for an award of EAJA fees and expenses, the
appellant must, inter alia, show that he was a prevailing party, within
the meaning of EAJA, as a result of the Court\'s disposition of his
appeal. *See Sumner*, 15 Vet.App. at 260. In *Sumner*, the Court ruled
that, if the benefit sought in bringing the litigation is not awarded,
only a remand predicated upon administrative error confers EAJA
prevailing party status on an appellant. *Id*. at 264-65. In support of
this rule, the Court followed the rationale of the Supreme Court in
*Buckhannon Bd. and Care Home, Inc. v. W. Va. Dep\'t of Health and Human
Res.*, 532 U.S. 598 (2001).

The Supreme Court\'s decision in *Buckhannon* prompted this Court to
recognize that it is a narrow passage through which an appellant must go
to attain prevailing-party status under EAJA. In *Thayer v. Principi*,
15 Vet.App. 204, 211 (2001), the Court adopted the holding in
*Buckhannon*, ruling that the catalyst theory was not a viable means to
attain EAJA prevailing-party status. In *Vaughn*, the Court held that an
appellant who attains a remand based solely upon the enactment of the
VCAA is not an EAJA prevailing party. *Vaughn*, 15 Vet.App. at 280; *see
also* *Fandry v. Principi*, 15 Vet.App. 299 (2001). *Vaughn* also held
that the inevitable-victory test is not a permissible basis for
establishing EAJA prevailing party status. *Id*. In *Sumner*, the Court
held that when the Court remands a matter to the Board and does not
award the benefit that was sought in bringing the litigation, the remand
must be predicated upon administrative error for the appellant to be a
prevailing party. *Sumner*, 15 Vet.App. at 264.

Relevant to the present matter, **the Court recently held that \"a
remand on the merits that is based on the rule of retroactive
application is *not* a remand** predicated upon administrative error
**for purposes of EAJA.\"** *Sachs v. Principi*, \_\_ Vet.App. \_\_,
\_\_, No. 98-1632, slip op. at 3 (Feb. 6, 2002) (emphasis added).
Therefore, an appellant receiving a remand under the rule of retroactive
application, that is, an appellant who receives a remand solely because
of a change in caselaw during the pendency of his or her appeal, is not
an EAJA prevailing party. *Id*. For this reason, the Court will deny the
appellant\'s EAJA application in the present matter because he was not
an EAJA prevailing party. *Id*.

Relying on a construct purportedly derived from this Court\'s prior
decisions and, along the way, rejecting *Sachs*, *supra*, our dissenting
colleague joins our denial of the appellant\'s application, yet only
after concluding that the appellant was a prevailing party, but that the
government was substantially justified in its actions. *See* 28 U.S.C. §
2412(d). This analysis, however, cannot withstand a close examination.

In *Brewer v. West*, 11 Vet.App. 228 (1998), the Court held that the
rule of retroactive application requires that a rule of law announced
and applied in a case be applied retroactively *by the Court* to all
matters pending before the Court. In *Brewer*, the Court affirmed rather
than remanded the Board\'s decision, and did not have occasion to
address whether the Board may have erred in failing to anticipate a
change in law or whether the appellant was an EAJA prevailing party.

In *Sumner*, the Court addressed its decision in *Stillwell v. Brown*,
6 Vet.App. 291 (1994), its pre-*Buckhannon* seminal decision defining an
EAJA prevailing party. The Court noted that *Stillwell* had relied on
the Supreme Court decision in *Shalala v. Schaefer*, 509 U.S. 292
(1993), for that decision\'s holding that a remand alone conferred
prevailing-party status upon an appellant. *Sumner*, 15 Vet.App. at
262-63. *Sumner* described the remand in *Stillwell*, as well as the
remand in *Schaefer*, as having been due to \"administrative error,\"
although the remand in *Stillwell* was ordered to permit the retroactive
application of new case law. Except for a single conclusory sentence,
there is no discussion in *Sumner* describing the administrative error
in *Stillwell*. Indeed, the word \"error\" does not even appear in
*Stillwell*, nor does it appear, in the context suggested in *Sumner*,
in *Schaefer*. *Stillwell* did not discuss or analyze the specific basis
for the appellant\'s remand on the merits, and did not hold that she had
prevailed due to the rule of retroactive application. *See Id*. at
300-01. Upon closer examination, it is clear that the Court\'s
recognition of the appellant in *Stillwell* as a prevailing party was
based on the Secretary\'s concession to that status, and on the apparent
rule drawn from *Schaefer*, that a party prevailed by virtue of
receiving a remand. *See Stillwell*, 6 Vet.App. at 300. The extent of
the Court\'s discussion of prevailing-party status in *Stillwell* was
that, before *Schaefer*, caselaw suggested the \"necessity of a causal
relationship between the lawsuit and the relief obtained\" for an
appellant to be a prevailing party. *Id*. at 300-01. *Stillwell* did
discuss what was heretofore known as the catalyst theory for
establishing prevailing-party status. *Id*. That theory, however, as
noted above, has been invalidated by the Supreme Court and this Court as
a basis for recognizing an appellant as a prevailing party. *See
Buckhannon* and *Thayer*, both *supra*.

Finally, the principal issue before the Court in *Stillwell*, and before
the Supreme Court in *Schaefer*, was whether the appellant\'s EAJA
application had been timely filed. As *Sumner* specifically recognized,
the discussions concerning prevailing-party status in both decisions
were in the context of this primary issue. *See Sumner*, 15 Vet.App. at
263 (\"\[T\]he language in *Stillwell*, *supra*, which, in and of
itself, could be read to mean that prevailing-party status is achieved
any time that this Court remands an appellant\'s underlying appeal . . .
must be read in the context of why the remands were ordered in both
*Schaefer* and *Stillwell*.\"). The attempt to use those cases to decree
this appellant to be an EAJA prevailing party takes them woefully out of
their context. Thus, neither *Schaefer* nor *Stillwell*, nor *Sumner*
nor *Brewer* supports the argument that this appellant, whose claim was
remanded solely because of a judicially crafted change in law, was an
EAJA prevailing party.

At the merits stage of the appeal underlying the EAJA application in the
present case, the rule of retroactive application was applied when the
Court remanded a matter based solely on the intervening change in
caselaw brought about by *Hodge*, *supra*. Before *Sachs*, no
precedential decision of this Court has addressed the effect, if any, of
a remand for retroactive application of a new judicial interpretation on
the determination of whether administrative error has occurred with
respect to EAJA prevailing-party status. (Our research did not find that
other courts had addressed the issue.) Here, as in *Sachs*, \"a remand
on the merits that is based on the rule of retroactive application is
*not* a remand predicated upon administrative error for purposes of
EAJA.\"

Accordingly, upon consideration of the foregoing, the appellant\'s EAJA
application is DENIED because the appellant is not a prevailing party as
required by 28 U.S.C. § 2412(d)(1)(a).

GREENE, *Judge*, concurring: I concur that Mr. Flemming is not a
prevailing party under EAJA. I write separately to express my view that
in *Brewer v. West*, 11 Vet.App. 228 (1998), the Court held that the
rule of retroactive application requires that new caselaw be applied
retroactively *by the Court* to all matters pending before the Court. In
*Hodge v. West*, 155 F.3d 1356 (Fed. Cir. 1998), the U.S. Court of
Appeals for the Federal Circuit (Federal Circuit) overruled the criteria
for determining the materiality of newly presented evidence. This
Federal Circuit opinion required remanding for readjudication those
cases involving the issue of the materiality of new evidence under 38
C.F.R. § 3.156(a). Applying the same retroactive application rule of
*Brewer*, Mr. Flemming\'s claim was remanded to the Board by this Court
after the Court noted that \"since *Hodge*, this Court has remanded many
cases in order for the BVA to apply that regulation as to claims to
reopen.\" *Flemming v. West*, No. 97-2150, 1999 WL 219986, at 1 (Vet.
App. Apr. 2, 1999).

Further, I agree that no precedential decision of this Court has
addressed the effect, if any, of a remand for retroactive application of
a new judicial interpretation on the question of whether administrative
error has occurred with respect to EAJA prevailing-party status.
However, a close analogy can be found in *Hewitt v. Helms,* 482 U.S. 755
(1987). In *Hewitt*, the Supreme Court held that a plaintiff was not a
prevailing party simply by virtue of an appellate court\'s favorable
statement of law, because the statement afforded plaintiff no relief on
the merits on that claim and was \"not the stuff of which legal
victories are made.\" *Id*. at 760. Here, Mr. Flemming did not receive
the benefit sought in bringing the litigation, i.e., the award of a
benefit, the recognition by the Court of an administrative error, or a
concession by the Secretary of administrative error. Rather, he is the
beneficiary of the retroactive application of a favorable statement of
law that under these circumstances would not constitute administrative
error. *See Sachs v. Principi*, \_\_ Vet.App. \_\_, No. 98-1632 (Feb. 6,
2002).

STEINBERG, *Judge*, concurring in part and dissenting in part: I concur
in the Court\'s disposition of this case but not in its rationale, which
I believe is not consistent with binding Court precedent. My reasons
follow.

**I. Background**

On April 2, 1999, the Court, in a single-judge order, vacated a July 29,
1997, Board of Veterans\' Appeals (Board or BVA) decision and remanded
the appellant\'s claim for reopening of a previously and finally
disallowed claim for Department of Veterans Affairs (VA) service
connection for spontaneous pnuemothraces. Prior to that order, the
appellant had proposed in his October 8, 1998, brief (Brief (Br.) at 7),
and the Secretary had agreed in his November 13, 1998, brief
(Secretary\'s Br. at 6-7), that a remand for this purpose was required
as a result of the issuance of *Hodge v. West*, 155 F.3d 1356 (Fed. Cir.
1998). In its April 2, 1999, order, the Court cited as the basis for the
remand the need \"for the Board to apply . . . 38 C.F.R. § 3.156(a)\" in
the first instance pursuant to the opinion of the U.S. Court of Appeals
for the Federal Circuit (Federal Circuit) in *Hodge*, *supra*. The
*Hodge* opinion was issued on September 16, 1998, after the July 1997
Board decision on appeal in the instant case, and overruled the caselaw
(principally, *Colvin v. Derwinski*, 1 Vet.App. 171, 174 (1991)) that
had been applied by the Board in its decision on appeal.

The appellant then filed, through counsel, the application, now pending
before the Court, for an award of reasonable attorney fees and expenses
pursuant to the Equal Access to Justice Act, 28 U.S.C. § 2412(d) (EAJA).
The EAJA application satisfies all EAJA jurisdictional and content
requirements. *See* 28 U.S.C. § 2412(d)(1)(B); *Scarborough v.
Principi,* 273 F.3d 1087, 1091-92 (Fed. Cir. 2001). On October 5, 2001,
the Court stayed this matter pending the outcome of *Vaughn v.
Principi*, which was decided on November 9, 2001, *Vaughn*, 15 Vet.App.
277 (2001) (per curiam order), *appeal docketed*, No. 02-7019 (Fed. Cir.
Nov. 29, 2001), or further order of the Court. For the reasons that
follow and not for those in the Court\'s opinion, I voted to deny the
appellant\'s EAJA application.

**II. Analysis**

***A. Prevailing Party***

In order to receive an EAJA award, an EAJA applicant must be a
prevailing party. *See* 28 U.S.C. § 2412(d)(1)(A) (\"court shall award
to a prevailing party . . . fees and other expenses\"); *Sumner v.
Principi*, 15 Vet.App. 256, 260-61 (2001) (en banc). In the *Sumner*
case, this Court recently held, in a unanimous en banc opinion, that in
order to attain prevailing-party status under the EAJA, there must
either be a direction by the Court for VA to award VA benefits or there
must be a remand by this Court that is \"predicated upon administrative
error\". *Sumner*, 15 Vet.App. at 265. Such a remand can be predicated
on administrative error if \"in his motion . . . \[,\] the Secretary
acknowledge\[s\] error\", or if, \"in remanding the matter\", the Court
\"recognize\[s\] administrative error\". *Ibid*. *Sumner* went on to
hold that prevailing-party status had not been achieved there because
there was no merits disposition (let alone a direction to award
benefits) and, as to the remand ordered, it was not predicated on
administrative error because, as we recently explained in *Cycholl v.
Principi*, \"neither one of the criteria for finding such a remand
\[was\] met -- that is, \'nowhere in his motion did the Secretary
acknowledge error, and because, alternatively, in remanding the matter
the Court did not recognize administrative error.\'\" *Cycholl*,
15 Vet.App. 355, 357 (2001) (quoting *Sumner*, 15 Vet.App. at 264).

In the instant case, as the majority correctly concludes, there is also
no question of any Court direction to award benefits. The appellant\'s
claim was remanded because the Board had not applied the correct test
for determining under 38 C.F.R. § 3.156(a), as interpreted by *Hodge*,
*supra*, whether new and material evidence had been presented. This
Court\'s April 2, 1999, order recognized, and the Secretary\'s brief in
the underlying merits appeal in this case conceded, that a remand was
necessary on these grounds. Although *Hodge* was issued after the date
of the Board decision on appeal, its holding had retroactive
applicability, because the Federal Circuit did not in any way purport to
make its holding prospective only and expressly made its interpretation
of the law applicable to the parties in the case before it, *Hodge*,
155 F.3d at 1364 (remanding for this Court to \"reconsider whether the
evidence submitted by \[the appellant\] is \'material,\' as defined in
the regulation\"). *See Brewer v. West*, 11 Vet.App. 228, 233-34 (1998)
(holding that judicial decisions are generally retroactive).[^1] In my
view, the Federal Circuit\'s opinion in *Hodge* retrospectively rendered
erroneous the Board\'s failure, in reliance on *Colvin*, *supra*, to
apply § 3.156(a) in this case, and the Secretary\'s concession of a
remand in his underlying brief and the Court\'s April 2, 1999, remand
order must thus be recognized as being \"predicated upon administrative
error\" within the meaning of *Sumner*, *supra*. Therefore, the
appellant is a prevailing party.

This result flows directly from our opinion in *Stillwell v. Brown*,
6 Vet.App. 291 (1994), as reexamined and explained in our unanimous en
banc *Sumner* opinion. *Stillwell* involved a Board decision that had
been vacated because of a subsequent (17 months later) caselaw change by
this Court in *Gregory v. Brown*, 5 Vet.App. 108 (1993), invalidating a
VA regulation. In *Sumner*, the Court addressed *Stillwell* as follows:

> The Court\'s seminal decision on prevailing-party status is
> *Stillwell*, *supra*. In the appeal underlying *Stillwell*, this Court
> granted the parties\' joint motion for remand pursuant to *Gregory*\[,
> *supra*\] (remand ordered ***for Board to correct error*** made in
> applying regulation, subsequently found to be unlawful, regarding
> surviving-spouse status; Court also ordered BVA to make specific
> factual findings in course of readjudication). In rendering a decision
> on the appellant\'s EAJA application in *Stillwell*, the Court,
> relying upon \[*Shalala v.* \]*Schaefer*, \[509 U.S. 292 (1993)\],
> held that the appellant was a prevailing party because ***she had
> obtained just such a remand, i.e., a remand predicated upon the BVA\'s
> application of an invalid regulation, even though the Court had not
> yet declared (in Gregory, supra) that invalidity at the time that the
> Board had rendered its decision on her claim***. *Stillwell*, 6
> Vet.App. at 300-01. The Court further held, however, that the
> Secretary was substantially justified because ***his misinterpretation
> of the regulation at issue was \"no more than a reasonable
> mistake\"*** and thus denied the appellant\'s EAJA application. *Id.*
> at 301-03. In the course of reaching its decision in *Stillwell*, the
> Court stated that *Schaefer* directed that \"a remand alone\"
> conferred prevailing-party status upon an appellant because a remand
> represented \"\'succe\[ss\] on any significant issue in litigation
> which achieve\[d\] some of the benefit . . . sought in bringing
> suit.\'\" *Stillwell*, 6 Vet.App. at 299-300 (quoting *Schaefer*, 509
> U.S. at 302, 113 S.Ct. 2625).

*Sumner*, 15 Vet.App. at 262 (emphasis added).

> The Court notes in particular that the ***remands in both Schaefer and
> Stillwell were predicated upon administrative error***. Although the
> Court recognizes the breadth of the language in *Stillwell*, *supra*,
> which, in and of itself, could be read to mean that prevailing-party
> status is achieved any time that this Court remands an appellant\'s
> underlying appeal, that language must be read in the context of why
> the remands were ordered in both Schaefer and Stillwell.

. . . .

> *Lematta*\[ *v. Brown*, 8 Vet.App. 504 (1996)\] also must be construed
> in the context in which it occurred. In the appeal underlying
> *Lematta*, the Court, unlike the district court in *Schaefer* and this
> Court in ***Stillwell***, did not order a remand ***predicated upon
> error in the administrative adjudication process***.

*Sumner*, 15 Vet.App. at 263 (emphasis added).

> Thus, a remand does not constitute \"some relief on the merits\"
> unless that remand is ***predicated upon administrative error***.
> *Buckhannon*, 121 S. Ct. at 1840. ***Stillwell***, *Lematta*, and
> *Swiney*\[ *v. Gober*, 14 Vet.App. 65 (2000)\], all *supra*,
> ***comport with this construct***.

*Sumner*, 15 Vet.App. at 264 (emphasis added).

The foregoing quoted passages make manifest that the en banc Court in
*Sumner* established that the *Stillwell* remand was one predicated on
administrative error within the meaning of the *Sumner* test (the
*Stillwell* merits remand was for readjudication under the regulation as
invalidated in *Gregory* and did not direct the award of any benefit;
hence, the first prong of the *Sumner* prevailing-party test, as quoted
above, clearly was not applicable).[^2] Because *Stillwell* involved
exactly the same retrospective-application-of-caselaw principle
(applying our opinion in *Gregory*) as that involved in the instant case
(applying the Federal Circuit\'s opinion in *Hodge*), I believe that we
are bound by our precedents to hold that the appellant in this case is a
prevailing party. *But cf. Sachs v. Principi*, \_\_ Vet.App. \_\_\_,
\_\_\_, No. 98-1632, 2002 WL 185332, \*1-2 (Feb. 6, 2002) (purporting to
decide that appellant was not prevailing party where appellant\'s claim
was remanded due to intervening change in law (in *Schroeder v. West*,
212 F.3d 1265 (Fed. Cir. 2000)), but not discussing *Stillwell*, either
as described in *Sumner*, or in any other way).

The majority attempts valiantly but unsuccessfully to demonstrate that
*Stillwell* and *Sumner* do not do what the above quotations clearly
show that they do. First, the majority mistakenly states: \"Except for a
single conclusory sentence, there is no discussion in *Sumner*
describing what the administrative error was in *Stillwell*.\" *Ante* at
\_\_\_, slip. op. at 3. Although the majority does not specify which
sentence it is branding \"conclusory\", the full Court in *Sumner* made
its position completely clear regarding the import of *Stillwell*, by
explaining unambiguously and explicitly, as shown in the above
quotations, that the Board had erred in *Stillwell* by misinterpreting
the regulation in question, as *Gregory* held subsequent to the Board
decision in *Stillwell*. The majority opinion then proceeds to raise two
matters that were involved in *Stillwell* but are not relevant to the
instant question whether the Board committed error in misapplying a VA
regulation: *Stillwell*\'s discussion of the catalyst theory and the
procedural question of the premature filing of the EAJA application in
*Stillwell*. *Ante* at \_\_\_, slip. op. at 3-4. Neither of these
matters bears on whether the Court in *Stillwell* and *Sumner* held that
a remand based on a prior caselaw change established prevailing-party
status. Nor does the majority explain how these matters are relevant to
the question before us on the prevailing-party issue (regarding the
timeliness of the filing of the EAJA application, for example, the
application of the appellant in *Stillwell* was accepted for filing by
the Court).

Finally, Judge Greene\'s concurring opinion cites *Hewitt v. Helms*, 482
U.S. 755 (1987), for a proposition, apparently, that prevailing-party
status requires \"relief on the merits\" (*ante* at \_\_\_, slip. op. at
\_\_). On its face, such a proposition is unexceptionable. The question,
of course, is what is \"relief on the merits\" or \"some relief\" or
\"some relief on the merits\", as the concept is variously stated in the
recent Supreme Court opinion in *Buckhannon Board & Home Care, Inc. v.
W. Va. Dep\'t of Health & Human Serv.*, 532 U.S. 598, 604 (2001)
(quoting *Hewitt*, 482 U.S. at 760, and *Hanrahan v. Hampton*, 446 U.S.
754, 757 (1980) (per curiam)). In *Sumner*, this Court exhaustively
discussed *Buckhannon* and other relevant Supreme Court cases, including
*Hewitt*, and concluded that the state of the law was as set forth above
regarding administrative error. *Sumner*, 15 Vet.App. at 261, 264.
Hence, the bottom line is still whether a tribunal errs when it
interprets a regulation incorrectly even though a court has not yet
declared the incorrect interpretation to be mistaken at the time the
interpretation was made. Apart from an ipse dixit position that a remand
to the Board because of a retrospective application of new caselaw is
not a remand predicated on error, neither *Sachs* nor the majority here
(nor Judge Greene\'s concurring opinion) has produced any persuasive
***analysis***.

If the Court wishes to change its precedents, it should do so
forthrightly by issuing an en banc opinion that disavows *Stillwell* and
*Sumner* regarding prevailing-party status\' being acquired based on
caselaw change. In that regard, the Court needs to address whether an
appellant in the ***lead case***, the one in which the caselaw change is
made, here the *Hodge* case, would be considered a prevailing party. I
do not understand the majority\'s analysis to be addressing that
question directly, but I do not see how an appellant who achieves the
invalidation of a VA regulation in the lead case, as in *Gregory*
underlying *Stillwell*, or achieves an overruling of precedential
caselaw in the lead case, as in *Hodge* underlying the instant case,
could be considered ***not*** to have prevailed in that civil action. If
that is ***not*** so, I would like to be shown the analysis supporting
such a conclusion. If the appellant in the lead case has achieved
prevailing-party status, by virtue of the Board\'s mistake in applying
or not applying a regulation, for example, then what is the basis for
holding, as here and in *Sachs*, that a subsequent appellant in a case
who obtains the same relief as the lead-case appellant has not similarly
prevailed in the civil action?

***B. Substantial Justification***

***1. Administrative Stage***

A determination that a party has \"prevailed\" because the Board had
relied on since-overruled caselaw might appear to produce a somewhat
curious result, but the determination of eligibility for fees under the
EAJA does not necessarily end at that point. Rather, under the EAJA, the
Secretary has affirmative defenses to an award, one of which is to
demonstrate that his position at both the administrative (BVA) and
litigation (Court) stages was \"substantially justified\". *See* 28
U.S.C. § 2412(d)(1)(A) (\"court shall award to a ***prevailing party***
. . . fees and other expenses . . . unless the court finds that the
position of the United States was ***substantially justified*** . . .\"
(emphasis added)), (d)(1)(B); *Cullens v. Gober*, 14 Vet.App. 234,
237-38 (2001) (en banc); *Lematta*, 8 Vet.App. at 506-07; *Doria v.
Brown*, 8 Vet.App. 157, 161 (1995). (The Secretary\'s other affirmative
defense is to convince the Court to determine \"that \'special
circumstances make an award unjust.\'\" *Id.* at 162.) In his June 29,
1999, response and his September 14, 2000, supplemental response, the
Secretary presented such an affirmative defense of his position at both
stages. Response at 4-6; Supplemental Response at 3-4.

Once an appellant has alleged a lack of substantial justification, the
burden shifts to the Secretary to prove that VA was substantially
justified in its administrative and litigation positions. *Cullens*, 14
Vet.App. at 237; *see* *also* *Locher v. Brown*, 9 Vet.App. 535, 537
(1996); *Stillwell*, 6 Vet.App. at 302 (holding that
substantial-justification query is one of reasonableness \"in law and
fact\"). This Court has previously held, in the context of determining
whether the Secretary\'s position in the underlying appeal was
substantially justified, that the Board\'s pre-*Hodge* reliance on
*Colvin* was reasonable. *Wisner v. West*, 12 Vet.App. 330, 333-34
(1999), *affirmed sub nom. Abbs v. Principi*, 237 F.3d 1342 (Fed. Cir.
2001); *Clemmons v. West*, 12 Vet.App. 245, 246-47 (1999). Accordingly,
the Court should hold that the Secretary has demonstrated that his
position in following *Colvin* in this case was substantially justified
at the administrative stage. *See Cullens*, *Wisner*, *Clemmons*,
*Lematta* and *Stillwell*, all *supra*.

The appellant raises a further argument that the position of the
Secretary at the administrative stage was not substantially justified.
*See* Application at 4; Br. at 3-6 (alleging that Board had erred by
applying *Reonal v. Brown*, 5 Vet.App. 458, 460-61 (1993), to facts in
this case as basis for denying appellant\'s claim to reopen).
Consideration of the appellant\'s argument on this ground would,
however, place the Court in the seemingly anomalous position of
examining the reasonableness of a position of the Secretary as to which
no error had been found by the Court or confessed by the Secretary in
the merits litigation.

In 28 U.S.C. § 2412(d)(1)(B), the EAJA provides the following regarding
the term \"substantially justified\":

> Whether or not the position of the United States was substantially
> justified shall be determined on the basis of the record (including
> the record with respect to the action or failure to act by the agency
> upon which the civil action is based) which is made in the civil
> action for which fees and other expenses are sought.

As to the appellant\'s contention that a lack of substantial
justification need not relate to the Secretary\'s position that was
found to be erroneous at the prevailing-party stage of the analysis, it
can be argued that the section 2412(d)(1)(B) language directing that
substantial justification \"be determined on the basis of the record . .
. with respect to the action or failure to act by the agency upon which
the civil action is based\" may even suggest that ***any basis*** argued
by the appellant for bringing the civil action forms part of \"the
record . . . made in the civil action\" that is to be considered in
determining whether the Secretary has demonstrated that his position is
substantially justified. Such an approach would seem to follow from
Judge Farley\'s persuasive arguments in his concurring opinion in
*Cullens*, 14 Vet.App. at 247-48 (Farley, J., concurring)
(\"\[a\]lthough such joint motions and remand orders certainly can
provide guidance to the Court in making \'substantial justification\'
determinations, there is simply no support for the proposition that the
analysis *must* end there\"). On the other hand, in his equally
persuasive concurring opinion in *Cullens*, Chief Judge Kramer stated:

> In sum, I believe that both Supreme Court and Federal Circuit
> precedents support our existing Court precedent that, where at the
> merits stage the Court has considered the parties\' arguments and
> issued an order or decision remanding the matter, it is the Court\'s
> remand order or decision and any joint motions underlying that order
> or decision (as well as any concessions of error made in the parties\'
> pleadings) that properly should be the focal point of any
> substantial-justification determination and that any additional
> allegations of error should not be considered by the Court in
> determining whether the Secretary\'s administrative position was
> substantially justified.

*Cullens*, 14 Vet.App. at 250 (Kramer, C.J., concurring).

In any event, these competing positions predated this Court\'s unanimous
opinion in *Sumner*, and its holding that in order to obtain
prevailing-party status under the EAJA by virtue of a Court remand, that
remand must have been predicated on administrative error. In view of
this altered legal landscape, I believe that Chief Judge Kramer\'s
position is the stronger as to this question, and would therefore hold
that the issue that is to be examined for a lack of substantial
justification must be one with respect to which the Secretary\'s
position was recognized by the Court, or acknowledged by the Secretary,
to be erroneous at the prevailing-party stage of the EAJA litigation. To
hold otherwise would be to create a fractured judicial review, wherein
prevailing-party analysis and substantial-justification analysis could
be conducted in isolation from one another, connected only at the
penultimate stage of the adjudication. Hence, the approach I suggest
that we adopt today would not only avoid the fractured judicial analysis
called for by the appellant\'s position on this issue but would also
eliminate the possibility of the further anomaly that at the EAJA stage
the Court could be re-reviewing the merits of the case long after the
Court had remanded the case to the Board, and perhaps even after some
adjudication on remand had already taken place, and that such a
secondary judicial merits determination of error would be without
binding effect in the merits adjudication at the administrative (VA)
level. *See Mahl v. Principi*, 15 Vet.App. 37, 42-43 (2001) (Steinberg,
J., dissenting).

Therefore, because the appellant\'s other arguments about whether the
position of the Secretary was substantially justified at the
administrative stage do not relate to the Secretary\'s position that I
would hold, *see* part I., above, as to prevailing-party status to have
resulted in a remand predicated on administrative error in the merits
litigation, I would hold that these arguments should not be considered
by the Court in assessing whether the Secretary\'s position was
substantially justified.

***2. Litigation Stage***

As to the Secretary\'s position at the litigation stage, the Secretary
conceded a *Hodge* remand within less than two months after *Hodge* was
decided and within less than five weeks after the appellant proposed
such a remand. The Secretary could be found to have been unjustified in
his litigation position only if he had engaged in \"foot dragging\" in
making his concession. *Pierre v. West*, 12 Vet.App. 92, 97 (1998);
*see* *Bowyer v. Brown*, 7 Vet.App. 549, 552 (1995). He clearly did not
do that here. Hence, I would hold that the Secretary has demonstrated
that his position at the litigation stage in promptly conceding a
*Hodge* remand was also substantially justified. *See Cullens*,
*Wisner*, *Clemmons*, *Pierre*, *Lematta*, *Bowyer*, and *Stillwell*,
all *supra*.

**III. Conclusion**

Accordingly, I concur in the judgment of the Court denying the
appellant\'s EAJA application, but do so because the Secretary has
successfully carried his burden of showing that his position at both the
administrative and litigation stages was substantially justified.
However, I dissent from the Court\'s holding, contrary to applicable
precedent, that the appellant did not achieve prevailing-party status
under the EAJA.

[^1]: I note that both the majority opinion (*ante* at \_\_, slip op. at
    3) and Judge Greene\'s concurring statement (*ante* at \_\_, slip
    op. at \_\_) contain the same puzzling remark about *Brewer v.
    West*, 11 Vet.App. 228 (1998), namely that its rule of retroactive
    application requires that new caselaw \"be applied retroactively *by
    the Court* to all matters pending before the Court\". I have been
    unable to divine what is meant by the special emphasis in these
    statements that this retroactive application is to be done ***by the
    Court***. If they mean to imply that the Board was not obligated to
    apply during the original adjudication caselaw made thereafter, then
    these statements are tautological. The Board could, of course, not
    be obligated to apply caselaw that was not in existence during the
    adjudication of the case. However, as I explain more fully in the
    body of this opinion, the fact that the Board was not obligated to
    follow caselaw not yet in existence does not mean that the Board did
    not commit error when it failed to apply VA\'s own regulation
    properly. On the other hand, if the emphasized words mean that the
    Board is not obliged to apply caselaw changes to matters pending
    before it, then that statement is merely wrong.

[^2]: It appears that the Supreme Court considered the district court\'s
    remand in *Schaefer* as one premised on the conclusion that \"the
    Secretary has committed legal error\". *Shalala v. Schaefer*, 509
    U.S. 292, 310 (1993) (Stevens, J., concurring).