Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-ca9-08-35919/USCOURTS-ca9-08-35919-0/pdf.json

Nature of Suit Code: 864
Nature of Suit: Social Security - SSID Title XVI
Cause of Action: 

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FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

TOM HARDISTY, 

Plaintiff-Appellant, No. 08-35919

v. D.C. No. 

M 3:06-cv-01670-BR ICHAEL J. ASTRUE, Commissioner

of Social Security Administration, OPINION

Defendant-Appellee. 

Appeal from the United States District Court

for the District of Oregon

Anna J. Brown, District Judge, Presiding

Argued and Submitted

October 9, 2009—Portland, Oregon

Filed January 25, 2010

Before: Diarmuid F. O’Scannlain and N. Randy Smith,

Circuit Judges, and Ronald M. Whyte,* District Judge.

Opinion by Judge O’Scannlain

*The Honorable Ronald M. Whyte, United States District Judge for the

Northern District of California, sitting by designation. 

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COUNSEL

Ralph Wilborn, Wilborn Law Office, P.C., Oregon City, Oregon, argued the cause for the plaintiff-appellant. Tim Wilborn

filed the briefs.

Kathryn A. Miller, Assistant Regional Counsel, Office of the

General Counsel, Social Security Administration, Seattle,

Washington, argued the cause for the defendant-appellee and

filed the brief. Karin J. Immergut, United States Attorney,

Britannia I. Hobbs, Assistant United States Attorney, and

David Morado, Regional Chief Counsel, Social Security

Administration, were on the brief.

OPINION

O’SCANNLAIN, Circuit Judge:

We consider whether a plaintiff may be awarded attorneys’

fees against the United States under the Equal Access to Justice Act with respect to issues not reached by a district court

in reversing a federal agency’s decision.

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I

A

Tom Hardisty filed a claim for supplemental security

income in 2003, alleging disability from early 2001 based on

several serious degenerative disk diseases, attention deficit

hyperactivity disorder, and a mathematics learning disorder.

The Social Security Administration (“SSA”) denied his claim

initially and on reconsideration. An administrative law judge

(“ALJ”) then held a hearing on Hardisty’s claim in 2005. At

that hearing, the ALJ heard testimony from Hardisty, a lay

witness, numerous physicians, a vocational expert, and others.

In due course, the ALJ decided that Hardisty was not entitled

to benefits because, although he had a severe impairment, he

retained the residual functional capacity to perform jobs that

exist in significant numbers in the national economy.

After the SSA’s Appeals Council denied Hardisty’s request

for review, making the ALJ’s decision the final decision of

the SSA’s Commissioner, Hardisty sought judicial review on

numerous grounds. In 2008, the district court reversed and

remanded to the Commissioner for the calculation of an

award and benefits, ruling that substantial evidence did not

support the ALJ’s credibility determination with respect to

Hardisty’s testimony. A month after judgment on the merits,

Hardisty filed a request for attorneys’ fees under the Equal

Access to Justice Act, 28 U.S.C. § 2412 (“EAJA”), which was

denied.1 Hardisty timely appealed denial of fees.

B

The ALJ based his decision on an adverse credibility finding against Hardisty. That finding rested on three grounds.

First, the ALJ reasoned that Hardisty’s criminal history,

1The amount, $8,866.12, included the cost of filing the fees request. It

does not include the cost of this appeal. 

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involving numerous property crimes committed eighteen

years ago in California, constituted a basis for questioning his

credibility. Second, the ALJ noted that a medical report from

Dr. Melanie Vergara, one of Hardisty’s physicians, was

inconclusive regarding malingering. Third, the ALJ found that

Hardisty intentionally sought to mislead the SSA when he testified that he had driven only halfway to the hearing, a statement contradicted by his own lay witness. Even though

Hardisty later corrected his testimony, the ALJ decided that

the record overall belied Hardisty’s credibility. 

In challenging the Commissioner’s ruling, Hardisty first

argued that the government erred when it “improperly

rejected Plaintiff’s testimony.” He also raised several other

arguments, including that the government improperly rejected

lay witness testimony and Dr. Vergara’s opinion, improperly

evaluated residual functional capacity, posed an improper

hypothetical to the vocational expert, and failed appropriately

to question the vocational expert. 

The district court ruled that the Commissioner had not provided clear and convincing reasons for discrediting Hardisty’s

testimony as required by Cotton v. Bowen, 799 F.2d 1403 (9th

Cir. 1986) (per curiam). Specifically, the court explicitly

rejected each of the government’s three reasons for discrediting Hardisty’s testimony. With respect to the first reason,

Hardisty’s criminal history, the court ruled Hardisty’s crimes,

which did not involve dishonesty and occurred more than

eighteen years prior to the hearing, too “remote” to be a clear

and convincing reason to discredit Hardisty. The court relied

on Federal Rule of Evidence 609, which allows for the admission of evidence of crimes involving dishonesty but not evidence of crimes older than ten years without a further

balancing of probative value and prejudicial effect. With

respect to the second reason, evidence of malingering, the

court ruled that the government failed to identify what evidence undermined the claimant’s complaints and failed to discredit the doctors who provided evidence corroborating

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Hardisty’s account. With respect to the third reason, the

inconsistency about driving, the court noted that Hardisty had

corrected his testimony on who drove to the hearing, thereby

resolving the conflict. The court then, pursuant to Varney v.

Secretary of Health and Human Services, 859 F.2d 1396,

1401 (9th Cir. 1988), remanded for the calculation and award

of benefits. 

C

In ruling on the subsequent EAJA request, the court first

addressed the issue on which Hardisty’s claim had been

remanded, concluding that the Commissioner’s position was

“substantially justified” and thus not a basis for EAJA feeshifting. 28 U.S.C. § 2412(d)(1)(A). The court observed that

the ALJ’s reliance on Hardisty’s criminal history, though contrary to the Federal Rules of Evidence, was not unlawful

because such Rules do not apply to administrative proceedings. See Bayliss v. Barnhart, 427 F.3d 1211, 1218 n.4 (9th

Cir. 2005). The court concluded, furthermore, that there was

“some basis” for the ALJ’s finding of malingering because of

Dr. Vergara’s report and that the ALJ’s interpretation of the

testimony regarding driving, while erroneous, had “some

basis in the record.” Thus, the court ruled, the Commissioner’s position was substantially justified and fee-shifting was

not appropriate. 

The court next addressed Hardisty’s argument that fees

should be awarded for the government positions that Hardisty

challenged but that it did not address when it originally

reviewed the case. Those positions too, according to Hardisty,

were not substantially justified. The court, however, declined

to award fees on these issues in the absence of the identification of any authority, including circuit precedent, requiring it

to do so.

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II

On appeal, Hardisty first argues that fees should be

awarded for those agency positions that Hardisty challenged

but that the district court did not decide.

A

[1] As always in cases of statutory interpretation, we begin

with the text of the statute. 28 U.S.C. § 2412. The text is particularly important in this case because the Supreme Court has

refused to allow the award of attorneys’ fees without clear

statutory authorization. Alyeska Serv. Pipeline Co. v. Wilderness Soc’y, 421 U.S. 240, 250 (1975) (citing Day v. Woodworth, 54 U.S. (13 How.) 363 (1852); Oelrichs v. Spain, 82

U.S. (15 Wall.) 211 (1872); Flanders v. Tweed, 82 U.S. (15

Wall.) 450 (1873); Stewart v. Sonneborn, 98 U.S. 187 (1879);

Fleischmann Distilling Corp. v. Maier Brewing Co., 386 U.S.

714 (1967); F.D. Rich Co. v. United States ex rel. Industrial

Lumber Co., 417 U.S. 116 (1974)); see Ruckelshaus v. Sierra

Club, 463 U.S. 680, 686 (1983) (“Given all the foregoing, we

fail to find in [the statute] the requisite indication that Congress meant to abandon historic fee-shifting principles . . . .”);

Ardestani v. I.N.S., 502 U.S. 129, 138 (1991) (“[W]e cannot

extend the EAJA to administrative deportation proceedings

when the plain language of the statute . . . constrain[s] us to

do otherwise.”); Buckhannon Bd. & Care Home, Inc. v. West

Virginia Dept. of Health & Human Res., 532 U.S. 598, 610

(2001) (“In Alyeska, we said that Congress had not ‘extended

any roving authority to the Judiciary to allow counsel fees as

costs or otherwise whenever the courts might deem them warranted.’ ”) (internal citations omitted). That is in part because,

in reviewing claims for attorneys’ fees, “[o]ur basic point of

reference is the ‘American Rule.’ ” Ruckelshaus, 463 U.S. at

684 (citing Alyeska, 421 U.S. at 247). That rule, which provides that “the prevailing litigant is ordinarily not entitled to

collect a reasonable attorneys’ fee from the loser,” Alyeska,

421 U.S. at 247, has dominated the American court system

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since its beginning, see id. at 271 (remarking that the American rule is “deeply rooted in our history”).

[2] The EAJA creates an exception to the American rule.

28 U.S.C. § 2412. It authorizes federal courts to award attorneys’ fees, court costs, and other expenses when a party prevails against the United States, although fee-shifting is not

mandatory. United States v. 313.34 Acres of Land, 897 F.2d

1473, 1477 (9th Cir. 1989). The statute provides that 

Except as otherwise specifically provided by statute,

a court shall award to a prevailing party other than

the United States fees and other expenses, in addition to any costs awarded . . . , incurred by that party

in any civil action . . . , including proceedings for

judicial review of agency action, brought by or

against the United States in any court having jurisdiction of that action, 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)(1)(A) (emphasis added).2 The term “ ‘position of the United States’ means, 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). 

[3] Nothing in these provisions extends fee-shifting to

issues not adjudicated. Section 2412(d)(1)(A) provides no

indication that attorneys’ fees should be awarded with respect

to positions of the United States challenged by the claimant

but unaddressed by the reviewing court. Nor does the definition clause in Section 2412(d)(2)(D) support fee-shifting. That

clause was amended to its current form in 1985 to focus

2The government has the burden of proving its positions were substantially justified. Flores v. Shalala, 49 F.3d 562, 569 (9th Cir. 1995). 

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courts on both the government’s litigation position and the

agency’s ruling. Comm’r, INS v. Jean, 496 U.S. 154, 159

(1990). In the absence of clear statutory text authorizing feeshifting, we decline to become a “roving authority” awarding

attorneys’ fees. Buckhannon, 532 U.S. at 610.

1

There are good reasons for denial of attorneys’ fees in situations regarding which the EAJA is silent. First, “[t]he EAJA

renders the United States liable for attorney’s fees for which

it would not otherwise be liable, and thus amounts to a partial

waiver of sovereign immunity.” Ardestani, 502 U.S. at 137.

“Waivers of immunity,” of course, “must be construed strictly

in favor of the sovereign, and not enlarge[d] . . . beyond what

the language requires.” Ruckelshaus, 463 U.S. at 685-86

(internal citations and quotation marks omitted) (citing

Alyeska, 421 U.S. at 267-68).

The Supreme Court has repeatedly interpreted attorneys’

fees statutes narrowly because of this concern. In Ardestani,

for example, the Court reasoned that its interpretation of the

EAJA as not applying to administrative deportation proceedings was “reinforced . . . by the limited nature of waivers of

sovereign immunity [which] must be strictly construed in

favor of the United States.” Id. at 137. Similarly, in Ruckelshaus, the Court interpreted an attorneys’ fee statute to require

that a party prevail because “[i]n determining what sorts of

fee awards are appropriate, care must be taken not to enlarge

[the statute’s] waiver of immunity beyond what a fair reading

of the language of the section requires.” 463 U.S. at 686

(internal quotation marks omitted). And in Alyeska, the Court

reversed an award of attorneys’ fees absent statutory authorization, noting the “well-known common-law rule that a sovereign is not liable for costs unless specific provision for such

liability is made by law.” 421 U.S. at 267-68 & n.42. Sovereign immunity concerns are especially relevant to interpretaHARDISTY v. ASTRUE 1427

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tion of the attorneys’ fees provisions in the EAJA, which does

not broadly waive immunity. Ardestani, 502 U.S. at 137.

Such concerns are also particularly relevant to this case. An

award of attorneys’ fees without textual support in the EAJA,

as Hardisty desires, increases the exposure of the United

States treasury. Such a step, without clear statutory authorization, we decline to take. We are especially hesitant because

extending the EAJA in this case constitutes an extreme departure from the American Rule, as the claimant failed to prevail

on the remaining issues on which he seeks fees. See Buckhannon, 532 U.S. at 598 (requiring judicial recognition of victory

to merit attorneys’ fees); Ruckelshaus, 463 U.S. at 680

(requiring some degree of success on the merits for fees).

2

Second, denial of attorneys’ fees in the face of silence in

the EAJA follows the command that “[a] request for attorney’s fees should not result in a second major litigation.”

Buckhannon, 532 U.S. at 609 (quoting Hensley v. Eckerhart,

461 U.S. 424, 437 (1983)). Avoiding an interpretation that

“ensur[es] that the fee application will spawn a second litigation of significant dimension” is central to Supreme Court

jurisprudence on fee-shifting statutes. Tex. State Teachers

Ass’n v. Garland Indep. Sch. Dist., 489 U.S. 782, 791 (1989).

In Buckhannon, for example, the Court rejected the “catalyst

theory” for assessing whether a party has prevailed — under

which a party may acquire fees if the suit was a catalyst for

change in the relationship between the litigants — because it

“is clearly not a formula for ‘ready administrability,’ ” 532

U.S. at 610 (quoting Burlington v. Dague, 505 U.S. 557, 566

(1992), as a “ ‘catalyst theory’ hearing would require analysis

. . . that ‘will likely depend on a highly factbound inquiry and

may turn on reasonable inferences from the nature and timing

of the defendant’s change in conduct.” Id. at 609. Similarly,

in Garland, the Court rejected the “central issue test” in favor

of the “significant issue” test because the former “promises to

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mire district courts entertaining fee applications in an inquiry

which two commentators have described as ‘excruciating.’ ”

489 U.S. at 791. And in Hensley, the court framed its remand

to the district court to determine the proper amount of attorneys’ fees with the warning that, nonetheless, “[a] request for

attorney’s fees should not result in a second major litigation.”

461 U.S. at 437.

Hardisty’s interpretation would require just such extensive

collateral litigation. He asks that the district court review all

challenges by the claimant, no matter how numerous, to see

whether the government’s position lacked substantial justification. And he asks that the district court do so even on those

issues that the district court chose not to reach in its original

decision. Such an inquiry requires the district court to decide

whether government positions it may not have evaluated at all

were in fact substantially justified. That puts the district court

in the position of conducting essentially de novo review of the

entire case for purposes of the fee litigation, contrary to the

command against “spawn[ing] a second litigation” of the

Supreme Court and to the far more streamlined “substantial

justification” review envisioned by the EAJA itself. We

decline to impose such burdens on district courts.

B

Hardisty argues that Flores v. Shalala, 49 F.3d 562 (9th

Cir. 1995), controls the outcome in this case in his favor. In

Flores, we held that district courts should focus on whether

the government’s position on the particular issue on which the

claimant earned remand was substantially justified, not on

whether the government’s ultimate disability determination

was substantially justified. Id. at 569. This holding, of course,

does not address the question of awarding attorneys’ fees on

issues the claimant raised but on which he did not earn

remand. Hardisty points to a footnote in Flores suggesting

that “attorney’s fees might be appropriate” in a situation like

his. Id. at 566 n.5. The problem with Hardisty’s argument is

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that the footnote merely foreshadows the issue in this case

without suggesting a resolution, as the Flores court recognized. Id. (“[W]e need not decide that [foreshadowed] question here.”). And even if the footnote is suggestive of a

resolution, it is no more than dicta. Furthermore, if Flores

bears on the outcome of this case at all, it weighs against

awarding attorneys’ fees because, as the government argues,

the court in Flores focused on the issue on which the claimant

earned remand. Id.

Hardisty also raises policy concerns. He argues that on our

view the district court can ignore egregious ALJ errors,

reverse on a trivial matter, and thus deny attorneys’ fees. This

possibility conflicts, in Hardisty’s view, with the purpose of

the EAJA, which was designed to encourage litigation against

government action. See Equal Access to Justice Act, Extension and Amendment, H.R. Rep. No. 120, as reprinted in

1985 U.S.C.C.A.N. 132. 

We do not find this policy argument persuasive. The first

problem with Hardisty’s argument is its view of the district

court. In Hardisty’s view, district judges can be disingenuous.

On the one hand, they carefully scrutinize agency reasoning

to ferret out erroneous agency rulings against claimants. They

labor to vindicate the claimants. On the other hand, they

manipulate the claimants’ arguments so as to reach only those

positions on which the government was both wrong and substantially justified. They thus stab the claimants in the back by

denying fees. This is an unrealistic, cynical, and perhaps paranoid view of what district court judges do. We are satisfied

that district judges traditionally decide cases on the strongest

ground the plaintiff raises both for reasons of fairness, clarity,

and judicial efficiency and to protect their rulings on appeal.

A district judge who navigates the narrow path Hardisty envisions wastes a great deal of judicial energy. And he exposes

himself to reversal by this court because walking the line

Hardisty posits — reversing the agency on closer questions

instead of obvious ones — by definition means that his rul1430 HARDISTY v. ASTRUE

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ings are weaker than they need to be. We decline to take such

a warped view.

But even if Hardisty’s conception of the friendly but backstabbing federal judge were true, Hardisty’s view creates several policy problems of its own. First, it requires district

courts to rule on every issue raised by the plaintiffs. But,

although litigants are the masters of their suits, judges are in

charge of resolving cases. Second, and relatedly, Hardisty’s

view encourages plaintiffs to raise and to brief every conceivable issue, as the longer the list the more likely the district

court, which has to consider every issue raised, might stumble

upon a government position lacking substantial justification.

This, in turn, forces the government to expend more resources

defending itself in fee litigation, responding to every claim

raised by plaintiffs. The policy consequences of Hardisty’s

position are far from appealing. And proceeding down that

path is unjustified in light of the unlikelihood that a district

court judge would ever act as Hardisty hypothesizes.

[4] In the end, Hardisty’s appeal to policy concerns at most

confronts us with competing policy arguments. Such a debate

is not enough to overcome the absence of statutory text authorizing supersession of the American Rule in this situation,

especially considering the judicially cognizable canons of

interpretation disfavoring the abrogation of sovereign immunity and the spawning of collateral litigation. We therefore

decline to extend the EAJA to require review of those issues

raised by the plaintiff but not addressed by the district court.

III

Hardisty also challenges the district court’s ruling that the

government’s position on the issue it did consider, the adverse

credibility finding, was substantially justified. A position is

“substantially justified” if it has a “reasonable basis in law

and fact.” Pierce v. Underwood, 487 U.S. 552, 565 (1988).

The district court found that the government’s adverse crediHARDISTY v. ASTRUE 1431

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bility finding, which rested on inferences regarding the claimant’s convictions, the claimant’s testimony concerning who

drove to the hearing, and Dr. Vergara’s report not denying

malingering, was substantially justified. This is a question of

the application of law to fact. We review the district court’s

ruling for abuse of discretion. Lewis v. Barnhart, 281 F.3d

1081, 1083 (9th Cir. 2002).

[5] The government’s adverse credibility finding was substantially justified because all of the inferences upon which it

rested had substance in the record. The government’s reliance

on stale convictions was not inconsistent with the Federal

Rules of Evidence, which do not apply to administrative proceedings. Bayliss v. Barnhart, 427 F.3d 1211, 1218 n.4 (9th

Cir. 2005). It thus had a reasonable basis in law and fact. The

government’s interpretation of the inconsistency regarding

who drove to the hearing was also substantially justified, as

even Hardisty admitted his confused statements cast doubt on

his credibility. Finally, the government’s reliance on Dr. Vergara’s report was substantially justified because that report

does question the severity of Hardisty’s symptoms. 

[6] Nor is there merit to Hardisty’s argument that the government’s action lacked substantial justification because the

ALJ failed to tie his findings to specific evidence. On the contrary, the government pointed to the three pieces of evidence

noted to support his adverse credibility finding. The district

court did not abuse its discretion in finding substantial justification.

IV

For the foregoing reasons, the judgment of the district court

is 

AFFIRMED.

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