U.S. GOVERNMENT PRINTING OFFICE

WASHINGTON : 

For sale by the Superintendent of Documents, U.S. Government Printing Office

Internet: bookstore.gpo.gov Phone: toll free (866) 512–1800; DC area (202) 512–1800

Fax: (202) 512–2104 Mail: Stop IDCC, Washington, DC 20402–0001

70–668 PDF 2011

GOVERNMENT LITIGATION SAVINGS ACT 

HEARING 

BEFORE THE

SUBCOMMITTEE ON COURTS, COMMERCIAL 

AND ADMINISTRATIVE LAW 

OF THE

COMMITTEE ON THE JUDICIARY 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

FIRST SESSION 

ON

H.R. 1996 

OCTOBER 11, 2011 

Serial No. 112–57 

Printed for the use of the Committee on the Judiciary 

( 

Available via the World Wide Web: http://judiciary.house.gov 

(II) 

COMMITTEE ON THE JUDICIARY 

LAMAR SMITH, Texas, Chairman 

F. JAMES SENSENBRENNER, JR., 

Wisconsin 

HOWARD COBLE, North Carolina 

ELTON GALLEGLY, California 

BOB GOODLATTE, Virginia 

DANIEL E. LUNGREN, California 

STEVE CHABOT, Ohio 

DARRELL E. ISSA, California 

MIKE PENCE, Indiana 

J. RANDY FORBES, Virginia 

STEVE KING, Iowa 

TRENT FRANKS, Arizona 

LOUIE GOHMERT, Texas 

JIM JORDAN, Ohio 

TED POE, Texas 

JASON CHAFFETZ, Utah 

TIM GRIFFIN, Arkansas 

TOM MARINO, Pennsylvania 

TREY GOWDY, South Carolina 

DENNIS ROSS, Florida 

SANDY ADAMS, Florida 

BEN QUAYLE, Arizona 

MARK AMODEI, Nevada 

JOHN CONYERS, JR., Michigan 

HOWARD L. BERMAN, California 

JERROLD NADLER, New York 

ROBERT C. ‘‘BOBBY’’ SCOTT, Virginia 

MELVIN L. WATT, North Carolina 

ZOE LOFGREN, California 

SHEILA JACKSON LEE, Texas 

MAXINE WATERS, California 

STEVE COHEN, Tennessee 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

PEDRO R. PIERLUISI, Puerto Rico 

MIKE QUIGLEY, Illinois 

JUDY CHU, California 

TED DEUTCH, Florida 

LINDA T. SA ́ NCHEZ, California 

[Vacant] 

SEAN MCLAUGHLIN, Majority Chief of Staff and General Counsel 

PERRY APELBAUM, Minority Staff Director and Chief Counsel 

SUBCOMMITTEE ON COURTS, COMMERCIAL AND ADMINISTRATIVE LAW

HOWARD COBLE, North Carolina, Chairman 

TREY GOWDY, South Carolina, Vice-Chairman 

ELTON GALLEGLY, California 

TRENT FRANKS, Arizona 

DENNIS ROSS, Florida 

BEN QUAYLE 

STEVE COHEN, Tennessee 

HENRY C. ‘‘HANK’’ JOHNSON, JR., 

Georgia 

MELVIN L. WATT, North Carolina 

[Vacant] 

DANIEL FLORES, Chief Counsel 

JAMES PARK, Minority Counsel 

(III) 

C O N T E N T S 

TUESDAY, OCTOBER 11, 2011 

Page 

THE BILL 

H.R. 1996, the ‘‘Government Litigation Savings Act’’ ........................................... 3 

OPENING STATEMENTS 

The Honorable Howard Coble, a Representative in Congress from the State 

of North Carolina, and Chairman, Subcommittee on Courts, Commercial 

and Administrative Law ...................................................................................... 1 

The Honorable John Conyers, Jr., a Representative in Congress from the 

State of Michigan, and Ranking Member, Committee on the Judiciary ......... 15 

The Honorable Steve Cohen, a Representative in Congress from the State 

of Tennessee, and Ranking Member, Subcommittee on Courts, Commercial 

and Administrative Law ...................................................................................... 24 

WITNESSES 

Jeffrey Axelrad, Professorial Lecturer in Law, The George Washington University Law School 

Oral Testimony ..................................................................................................... 33 

Prepared Statement ............................................................................................. 35 

Lowell E. Baier, President Emeritus, The Boone and Crockett Club 

Oral Testimony ..................................................................................................... 45 

Prepared Statement ............................................................................................. 47 

Jennifer R. Ellis, Chairman, Western Legacy Alliance 

Oral Testimony ..................................................................................................... 54 

Prepared Statement ............................................................................................. 57 

Brian Wolfman, Visiting Professor, Georgetown University Law Center 

Oral Testimony ..................................................................................................... 64 

Prepared Statement ............................................................................................. 67 

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Prepared Statement of the Honorable John Conyers, Jr., a Representative 

in Congress from the State of Michigan, and Ranking Member, Committee 

on the Judiciary ................................................................................................... 16 

Prepared Statement of the Honorable Cynthia M. Lummis., a Representative 

in Congress from the State of Wyoming ............................................................ 23 

Material submitted by the Honorable Steve Cohen, a Representative in Congress from the State of Tennessee, and Ranking Member, Subcommittee 

on Courts, Commercial and Administrative Law .............................................. 27 

APPENDIX 

MATERIAL SUBMITTED FOR THE HEARING RECORD

Prepared Statement of the Honorable Steve Cohen, a Representative in Congress from the State of Tennessee, and Ranking Member, Subcommittee 

on Courts, Commercial and Administrative Law .............................................. 107 

Letter in Support of H.R. 1996, the ‘‘Government Litigation Savings Act’’ ........ 114 

Letter from Richard Paul Cohen, Executive Director, National Organization 

of Veterans’ Advocates, Inc. (NOVA) .................................................................. 117 

Page

IV 

Letter from Don Shawcroft, President, Colorado Farm Bureau .......................... 119 

Letter from Victor B. Flatt, Tom & Elizabeth Taft Distinguished Professor 

of Environmental Law, Director, Center for Law, Environment, Adaptation 

and Resources (CLEAR), University of North Carolina School of Law ........... 120 

Letter in Support of H.R. 1996, the ‘‘Government Litigation Savings Act’’ ........ 123 

Letter from Wayne Allard, DVM, Vice President, Government Relations, 

American Motorcyclist Association (AMA) ......................................................... 125 

Letter from Cynthia M. Lummis, Member of Congress ....................................... 126 

Letter from Lowell E. Baier, President Emeritus, Boone and Crockett Club .... 128 

(1) 

GOVERNMENT LITIGATION SAVINGS ACT 

TUESDAY, OCTOBER 11, 2011 

HOUSE OF REPRESENTATIVES,

SUBCOMMITTEE ON COURTS, 

COMMERCIAL AND ADMINISTRATIVE LAW, 

COMMITTEE ON THE JUDICIARY, 

Washington, DC. 

The Subcommittee met, pursuant to call, at 3:35 p.m., in room 

2141, Rayburn House Office Building, the Honorable Howard Coble 

(Chairman of the Subcommittee) presiding. 

Present: Representatives Coble, Gowdy, and Cohen. 

Also Present: Representatives Conyers and Lummis. 

Staff Present: (Majority) Daniel Flores, Subcommittee Chief 

Counsel; John Hilton, Counsel; Johnny Mautz, Counsel; Ashley 

Lewis, Clerk; (Minority) Norberto Salinas, Counsel; and James 

Park, Counsel. 

Mr. COBLE. Good afternoon, ladies and gentlemen. The Subcommittee will come to order. I will give my opening statement, 

and then I will recognize the distinguished gentleman from Michigan. 

We are a litigious society. One tactic often used by some plaintiffs with deep pockets but weak legal claims is to sue anyway and 

then drag out the litigation as long as possible. Sooner or later 

many defendants will realize that it is cheaper or less expensive to 

settle rather than enjoy the hollow victory of winning in court by 

breaking the bank. And no one has deeper pockets than the Federal Government. If it runs out of money, it simply prints more. 

The Federal Government literally has thousands of attorneys permanently on staff, so no person or corporation could ever hope to 

compete with such overwhelming resources. 

Recognizing this, in 1980 the Congress adopted the Equal Access 

to Justice Act to help small businesses and ordinary people vindicate their rights in litigation against the Federal Government. 

When the government loses in court, the Equal Access to Justice 

Act allows a court to order the government to pay the other side’s 

attorneys fees and costs when the government’s legal claim was not 

substantially justified. For this reason, the EAJA has been called 

the anti-bully law. 

Experience over the past 30 years, however, has revealed a number of shortcomings in the EAJA, which is what we are here to discuss today. Mrs. Lummis, our colleague from Wyoming, has been 

pursuing this issue for some time now, and I want to acknowledge 

her efforts in this regard. Her bill, H.R. 1996, the ‘‘Government 

2 

Litigation Savings Act,’’ proposes several reforms to the EAJA. 

First is the lack of transparency. The EAJA formerly required the 

Chairman of the Administrative Conference of the United States 

and the Attorney General to file annual reports with Congress stating how much the Federal Government was paying out, but the 

conference lost its funding in 1995 and is only just now getting 

back on its feet, and the Attorney General’s reporting requirement 

was repealed altogether in 1995. The bottom line is, there has been 

no government-wide accounting of EAJA payments since fiscal year 

1994. We don’t know how much money is going out the door, we 

don’t know if the EAJA is helping those for whom it was created 

to help; that is, ordinary Americans and small businesses. Fixing 

this lack of transparency is something I hope we can agree upon. 

Related to the question of who is benefiting from EAJA is the eligibility exception for nonprofit 501(c)(3) organizations. It is not altogether clear why this exception was included in the original law, 

but it is clear from a recent GAO audit that it benefits certain wellheeled environmental groups who use litigation as a strategy to advance their ideological agenda. Whether a multimillion-dollar organization that already is tax exempt should have the added benefit 

of being able to collect attorneys fees and costs from the Federal 

Government, which originally of course comes from the American 

taxpayers, is another issue which our witnesses I am sure will address. 

H.R. 1996 also would reform the special factor exception; that is, 

the $125 per hour cap on attorneys fees. Because of the lack of annual reporting, this evidence is anecdotal, but it appears that some 

courts interpret this exception very loosely. If the exception has become so large that it swallows the rule, why bother capping the attorneys fees at all? H.R. 1996 would abolish this special factor exception. 

Finally, in many parts of the country a good lawyer, the kind you 

would want to hire if the Federal Government was on the other 

side, costs in excess of $125 per hour. H.R. 1996 proposes to fix this 

by raising the cap to $175 per hour and allowing it to be adjusted 

annually based upon the consumer price index. 

In closing, I want to thank Mrs. Lummis for her dedication to the 

issue. H.R. 1996 deserves careful and serious consideration, and I 

look forward to the witnesses’ testimony and reserve the balance 

of my time. 

[The bill, H.R. 1996, follows:] 

3 


HR1996-1.eps
4 


HR1996-2.eps
5 


HR1996-3.eps
6 


HR1996-4.eps
7 


HR1996-5.eps
8 


HR1996-6.eps
9 


HR1996-7.eps
10 


HR1996-8.eps
11 


HR1996-9.eps
12 


HR1996-10.eps
13 


HR1996-11.eps
14 


HR1996-12.eps
15 

Mr. COBLE. I am now pleased to recognize the distinguished gentleman from Michigan, Mr. John Conyers, for his opening statement. 

Mr. CONYERS. Thank you, Mr. Chairman. I am happy to be with 

you to form a quorum so that we could hold this hearing this afternoon, and I wanted to just go over some materials here to make 

sure I understand what it is we are doing, because according to the 

author, she did not intend to affect the enjoyment of the present 

law to affect veterans, Social Security claimants, and small businesses. And maybe I am wrong here, but we have information that 

the pro bono provision would prove a disaster for Social Security 

claimants, and the nonprofit legal service organizations and the 

private bar who often provide pro bono services would be, in many 

if not most instances, precluded from any legal recovery. So I hope 

that this becomes clarified in the course of our hearing today. 

Now, the Equal Access to Justice Act is more than 30 years old, 

and it has helped seniors, veterans, Social Security claimants vindicate their rights against inaccurate or unreasonable or sometimes 

illegal government action. So the first thing I want to indicate that 

according to our reading of the bill, this proposal may prevent 

those who are most—the most needy in our society from securing 

legal representation; that is senior citizens, that is veterans, that 

is disabled individuals, and so many of them would never get to 

court if they couldn’t get attorneys who would take the case pro 

bono but would recover legal fees if they prevail. And so what we 

are doing is a horrendous disservice to disabled veterans, some several thousand who recovered fees during fiscal year 2010 when 

they successfully appealed Veterans Administration decisions that 

denied them disability benefits. 

So I know that the Committee is very well intentioned, but why 

we would be doing something like this is something I will remain 

to have our distinguished panel of witnesses explain to me. So I 

thank you very much, Mr. Chairman, and ask unanimous consent 

to submit the rest of my statement for the record. 

Mr. COBLE. Without objection. Thank you, Mr. Conyers. 

[The prepared statement of Mr. Conyers follows:] 

16 


70668A-1.eps
17 


70668A-2.eps
18 


70668A-3.eps
19 


70668A-4.eps
20 


70668A-5.eps
21 


70668A-6.eps
22 

Mr. COBLE. Before I recognize the Ranking Member of the Subcommittee, the distinguished gentlewoman from Tennessee, Mrs. 

Lummis, the author of the bill, is not allowed to participate, but 

without objection, we will permit her to sit on the dais. Mrs. 


70668A-7.eps
23 

Lummis, good to have you with us, and without objection, I would 

like to introduce her statement for the record as well. 

[The prepared Statement of Ms. Lummis follows:] 


70668B-1.eps
24 

Mr. COBLE. I am now pleased to recognize Mr. Cohen, the gentleman from Memphis, for his opening statement. 

Mr. COHEN. Thank you, Mr. Chairman. I appreciate the—— 

Mr. CONYERS. Would the distinguished Ranking Member yield to 

me for just a quick query to the Chairman of the Committee? 

Mr. COHEN. The distinguished Ranking Member will yield to the 

distinguished Ranking Member of the full Committee and the Congressman who represents the Detroit Tigers. 


70668B-2.eps
25 

Mr. CONYERS. Mr. Chairman, is it possible that the author of the 

bill would be able to be a witness to the hearings? 

Mr. COBLE. I would think no, Mr. Chairman. I would say no. 

Mr. CONYERS. And why is that, could I ask? 

Mr. COBLE. Pardon? 

Mr. CONYERS. You don’t let the authors of bills testify? 

Mr. COBLE. No, sir. 

Mr. CONYERS. Oh, pardon me. 

Mr. COHEN. Overruled. 

Mr. CONYERS. That is contrary to everything I thought I had 

learned about the way the process works; but if authors of the bill 

can’t testify, but they can sit on the Committee, I guess that is second best. 

Mr. COBLE. No doubt. 

Mr. CONYERS. All right. Thank you. 

Mr. COBLE. Mr. Cohen is recognized for 5 minutes. 

Mr. COHEN. Thank you. I am recognized in my capacity as being 

the Ranking Member. Could I yield my time to the distinguished 

lady from Wyoming and let her give her statement? 

Mr. COBLE. Well, I think not. 

Mr. COHEN. Well, I tried. I tried. 

During this Congress, instead of focusing on much-needed job 

creation and the opportunity for Mrs. Lummis to make her statement, the majority has pushed broad anti-regulatory messages and 

talked about small business. 

Today we hold a hearing on H.R. 1996, the, quote, Government 

Savings Litigation Act, which seems to discourage those who want 

to challenge agency actions, including small businesses and nonprofit organizations. Specifically, the bill would amend the Equal 

Access to Justice Act, to prohibit small businesses and others who 

have successfully prevailed in court against the government from 

recovering legal fees. As such, this hearing and legislation seems 

to have the effect of being pro-government outreach and dissuading 

small businesses from having the opportunity to go to court and get 

their attorneys fees paid, just the opposite of what the majority has 

talked about many times and one of the many reasons why I wanted the distinguished, attractive, and bright lady from Wyoming to 

explain her bill. 

Under the EAJA, individuals and small businesses can request 

reasonable attorneys fees if they are the prevailing party in a legal 

action against the government. The award, however, is not automatic. If the government can show its actions were substantially 

justified, that is the test, then the award is denied. This substantial justification defense prevents many awards and discourages 

frivolous or marginal cases that were filed based solely on the hope 

of recovering attorneys fees. 

The Equal—the EAGA—JA—also caps the fee rate at below the 

market rate, except that a judge may award fees above the $125 

cap if a specialized skill was necessary for the litigation. Still, the 

prevailing party must show that legal representation could not 

have been obtained at that capped rate but for the possibility of obtaining a higher rate. This below-market cap rate minimizes litigation and discourages frivolous or marginal cases. I haven’t heard of 

26 

anybody getting $125 in a thousand years. I am sure nobody in this 

room even considers such a thing. 

The current EAJA attorney fee provision strikes the right balance between allowing small entities the opportunity to challenge 

the government, little guy against big guy, while preventing expensive and runaway litigation. Still, even with the very slim chance 

of recovering attorneys fees, critics suggest that awards under this 

act are astronomical and too common. This criticism, however, is 

based on a mere estimate of awards and pure conjecture about the 

frequency of awards, as there has been no comprehensive governmental study since 1998. An updated study to reflect the current 

situation rather than that 13 years of age would be a good government measure. 

This bill requires a report, which is laudable. Unfortunately, that 

is the only reasonable provision of this bill. H.R. 1996 should concern all of us. It will negatively impact veterans, seniors, our public 

health and small businesses. 

A 1998 GAO report found that in 1994, 98 percent of fee applications submitted and 87 percent of the dollars awarded under this 

act were in Social Security disability cases and veterans disability 

cases, two of our favorite constituencies. Based on those numbers, 

this bill would prevent the awarding of fees disproportionately in 

cases brought by nonprofit veterans groups challenging the VA for 

systematic delays. This discourages the filing of these cases and 

leaves it to individual veterans to bring the cases. Most of these 

veterans cannot afford to do so. 

Likewise, the bill also discourages legal aid programs from bringing cases on behalf of senior citizens. Further, because H.R. 1996 

bars recovery of fees from most nonprofits in citizen suits, it will 

discourage environmental groups from bringing actions to enforce 

environmental laws that protect our public health and lands. 

In light of the impact on our veterans, seniors, and public health 

and lands, and many other concerns, various groups have expressed opposition. They include the National Organization of Veteran’s Advocates, the National Organization of Social Security 

Claimant’s Representatives, the Natural Resources Defense Council—which, of course, includes Robert Redford, who I am sure the 

sponsor of this bill likes, for all women like him—the National 

Legal Aid and Defender Association, the Center for Auto Safety, 

and the Center for Food Safety. There are dozens more. 

I thank our witnesses for their participation in today’s hearing. 

I look forward to their testimony, and I look forward to the Memphis-East Carolina football game this Saturday and hope you won’t 

beat up on us too badly, and—— 

Mr. COBLE. Based upon last week’s outing against Houston, I 

don’t think you have very much to worry about. 

Mr. COHEN. We are worse, believe me. 

Mr. COBLE. We will find out. 

Mr. COHEN. Can I submit these for the record? 

Mr. COBLE. Without objection, it will be received. 

[The information referred to follows:] 

27 


70668C-1.eps
28 


70668C-2.eps
29 


70668C-3.eps
30 


70668C-4.eps
31 

Mr. COHEN. Thank you, sir. 

Mr. COBLE. And I say to the gentleman from Michigan, congratulations to the Tigers. Are they up now? Are they leading? 

Mr. CONYERS. Not at all. 

Mr. COHEN. But they are going home. My team is over. 

Mr. COBLE. Your team is over? Texas? Oh, boy. 


70668C-5.eps
32 

It is good to see all of you. I have detailed introductions to give, 

but I think we need to know the background of our distinguished 

witnesses, so please bear with me. Good to have each of you with 

us. 

Mr. Jeffrey Axelrad teaches at George Washington University 

School of Law. Mr. Axelrad served at the Justice Department for 

more than 35 years and was actively involved in policy and development as well as litigation. He worked as director of the Department of Justice’s tort branch from 1977 to 2003. He also served as 

a trial attorney for 8 years, earning the civil division’s highest 

honor, the Stanley D. Rose Memorial Award. He also received the 

Army’s highest civilian award, the Commander’s Award for Public 

Service, a Presidential Meritorious Executive Award, and the Office 

of Management and Budget General Counsel’s Award. Mr. Axelrad, 

thank you for sharing your insights and experiences with the Subcommittee today. 

Mr. Lowell Baier is the immediate past president of The Boone 

and Crockett Club, the Nation’s oldest conservation organization. 

The Boone and Crockett Club was founded by Teddy Roosevelt in 

1887 to promote wildlife conservation and was instrumental in establishing Federal lands, conservation laws and agencies, and several other national conservation groups. A lawyer by training, Mr. 

Baier is currently leading the Club in the extensive study of the 

role of litigation in conservation. He also is the founding director 

of the National Conservation Leadership Institute and Executive 

Education Program for Conservation Professionals. For these and 

other accomplishments during his career as a small business 

owner, Mr. Baier was named conservationist of the year by Field 

and Stream magazine. Mr. Baier, we are glad to have you with us 

as well today. 

Ms. Jennifer Ellis is a cattle rancher and wheat and hay farmer 

from Blackfoot, Idaho. She chairs the Western Legacy Alliance, a 

volunteer organization focused on preserving working land and lifestyles in the American West. Recently Ms. Ellis was president of 

the Idaho Cattle Association and chairman of Idaho Sage Grouse 

Advisory Committee. She also chaired Idaho’s Wolf Depredation 

Committee, and she is director on the board of the Idaho Agricultural Credit Association, and the former chairman of the Blackfoot 

Hope House Project. Through these experiences, Ms. Ellis has acquired much firsthand knowledge of environmental litigation, more 

than she ever wanted to know I would dare wager. Ms. Ellis, thank 

you for coming all the way from Idaho to be with us today. We appreciate that. 

Finally, Mr. Brian Wolfman is a visiting professor of law at the 

Georgetown University School of Law where he served as the codirector for the school’s Institute for Public Representation. Prior 

to joining the Georgetown faculty, Mr. Wolfman spent nearly 20 

years at the national public interest law firm, Public Citizen Litigation Group, where he served the last 5 years as director. Prior to 

that, he also conducted trial and appellate litigation as a staff lawyer at a rural poverty law program in Arkansas. He has handled 

a broad range of litigation and argued five cases before the Supreme Court. He has taught appellate litigation courses at his alma 

mater, Harvard School of Law, and also served as an adjunct proVerDate Aug 31 2005 14:32 Nov 10, 2011 Jkt 000000 PO 00000 Frm 00036 Fmt 6633 Sfmt 6601 H:\WORK\COURTS\101111\70668.000 HJUD1 PsN: DOUGA
33 

fessor at Stanford, Vanderbilt, and American University. Mr. 

Wolfman, thank you as well for being with us. 

Gentlemen and lady, good to have you all with us. We try to go 

by the 5 minute rule, so if you will keep your eye peeled on the 

little panel before you, when the light is green, that indicates that 

you are alive and well, but that light will turn amber, and that is 

your notice that a 1-minute delay is about to be resolved. We will 

not keelhaul any of you for violating the 5-minute rule, but if you 

can comply with it, we would appreciate that. Is that panel working out there? Can you all see the panel? Can you see the green 

light now? 

Mr. COBLE. Mr. Axelrad, we would be glad to have you start your 

testimony. 

TESTIMONY OF JEFFREY AXELRAD, PROFESSORIAL LECTURER IN LAW, THE GEORGE WASHINGTON UNIVERSITY 

LAW SCHOOL 

Mr. AXELRAD. Thank you. I will summarize my statement and 

would appreciate the entire statement being placed in the record. 

Mr. COBLE. Without objection. 

Mr. AXELRAD. I am here to share my views on H.R. 1996, the 

Government Litigation Savings Act. This bill proposes sensible 

amendments to provisions of the Equal Access to Justice Act, commonly known as EAJA. My testimony will discuss specific improvements this bill makes to EAJA. 

Payment of costs and attorneys fees is a transfer of money, pure 

and simple. Our Constitution’s appropriations clause bars payments from the public Treasury absent a congressional appropriation. This clause stands as a bulwark, ensuring that the Congress 

decides whether and under what conditions Treasury funds should 

be utilized. 

EAJA includes four types of key provisions. First, the United 

States is made susceptible to an award of attorney fees under certain circumstances when a private party would otherwise be responsible for paying an attorney fee after receiving an award in a 

judicial proceeding. This regime applies to settlements as well. 

Second, EAJA authorizes attorney fee awards and expenses if the 

nongovernment party prevails and the government’s underlying 

conduct was not substantially justified absent special circumstances. This is a one-way, loser-pay provision that creates different law against the American taxpayer. EAJA puts the Federal 

Government in a unique and largely disfavored position. H.R. 1996 

includes needed amendments to more precisely specify the means 

of determining an award. 

Third, EAJA includes standards for recovering attorney fees, including when the underlying conduct was not substantially justified and when the nongovernment party is considered the prevailing party. Vague terms like these can lead to protracted side 

litigation and manipulation. H.R. 1996 seeks to avoid abuse and to 

clarify the provisions. 

Fourth, EAJA also penalizes the government if it is not sufficiently successful in seeking judicial review of an agency adjudication where civil action commenced by the United States. There is 

no such provision against such demands for the private party 

34 

which can disadvantage government civil actions and enforcement 

proceedings. 

H.R. 1996 makes several needed amendments to EAJA’s substantive attorney-fee award provisions and adds requirements to 

collect and assemble precise data permitting insight into EAJA’s 

results in practical terms. H.R. 1996 raises the maximum rate of 

payment for attorneys from $125 per hour to $175 per hour and 

substitutes a precise means of determining cost-of-living increases. 

In return for raising the fee, these amendments eliminate the exception to the fee limit for an attorney who asserts that a special 

factor, such as the limited availability of qualified attorneys or 

agents for the proceedings, justifies a higher fee. 

In Pierce v. Underwood, the Supreme Court attempted to limit 

the ability to evade application of the cap, but its decision did not 

end litigation over whether the fee cap can be pierced. Far from it. 

The Federal Appellate Courts’ decisions are in disarray. 

H.R. 1996 places a limit or cap with a limited exception on the 

aggregate amount the Public Fisc will pay to an individual or entity for attorney fees or other expenses and confines EAJA to parties 

who have a direct and personal monetary interest in the proceedings. These amendments seek to confine EAJA to its legitimate 

and original purpose. 

H.R. 1996 sharpens the language of extant fee-reduction provisions by requiring reductions if the party seeking award has engaged in specified abusive misconduct. The ability of Congress to 

perform its oversight of EAJA depends on the availability of information concerning agency payments predicated on the act. Currently this information is largely unavailable. Agencies have no obligation to collect and assemble data, and even if some agencies did 

collect data, there is no central authority to organize and report the 

data in a sensible format both to the Congress and the public. 

H.R. 1996 remedies this lack of information. Specifically, H.R. 

1996 requires the Chairman of the Administrative Conference of 

the United States to issue an annual report to the Congress and 

to make the report publicly available online. H.R. 1996 also requires GAO to conduct a one-time audit of EAJA’s implementation 

during recent years, starting with 1995. 

H.R. 1996 leaves intact the basic structure and central focus of 

EAJA. H.R. 1996 serves to correct unintended consequences and 

clarifies vague terminology that has resulted in substantial wasteful collateral litigation. H.R. 1996 also requires that Congress receive information or that it may determine how effectively EAJA 

works in practice and the costs associated with EAJA. This will 

permit the Congress to provide more effective oversight and enhance the ability of citizens to hold their government accountable 

for the actions of government agencies. In my opinion, H.R. 1996 

represents a move toward enhancing the ability of EAJA to best 

serve its intended purposes. 

I will be happy to answer any questions. 

[The prepared statement of Mr. Axelrad follows:] 

35 


Axel-1.eps
36 


Axel-2.eps
37 


Axel-3.eps
38 


Axel-4.eps
39 


Axel-5.eps
40 


Axel-6.eps
41 


Axel-7.eps
42 


Axel-8.eps
43 


Axel-9.eps
44 

Mr. COBLE. Thank you, Mr. Axelrad. 

Mr. Baier, you are recognized for 5 minutes. 


Axel-10.eps
45 

TESTIMONY OF LOWELL E. BAIER, PRESIDENT EMERITUS, 

THE BOONE AND CROCKETT CLUB 

Mr. BAIER. Thank you, Mr. Chairman, Representative Cohen, 

Representative Conyers, Members of the Committee. I represent 

The Boone and Crockett Club, America’s oldest conservation organization, founded in 1887 by Theodore Roosevelt, and I follow him 

as the Club’s 28th president and am now president emeritus. 

We support this bill because it will improve managing the conservation of our Nation’s fish, wildlife, and natural resources. We 

also support the Equal Access to Justice Act’s historic primary purpose for retirees, for veterans, for small business, and for all citizens. They must be protected from mistakes and overzealous Federal agencies. These are the citizens who can least afford to protect 

themselves, and we are resolute that we do not tread on the historic purpose of EAJA. 

Under this bill, individuals will remain eligible to use EAJA if 

their net worth does not exceed $2 million, just as they do today. 

Likewise, small business will remain eligible provided their net 

worth does not exceed $7 million. The bill extends these same eligibility requirements to large interest groups. Today these groups 

can recoup legal fees under EAJA regardless of their net worth. 

Unlimited eligibility has helped make litigation commonplace in 

the conservation arena. This is so roundly understood that even 

Earl Devaney, the Inspector General of the Department of Interior 

in 2008, said, ‘‘As it now stands, lawsuits are driving nearly everything the Fish and Wildlife Service does in the endangered species 

arena.’’ 

Just last month a new settlement agreement imposed the views 

of two aggressive interest groups on the entire endangered species 

listing program through 2017. This settlement resulted from litigation on procedural—procedural rather than substantive grounds. 

This is the type of litigation for which EAJA provides a perverse 

incentive. We want to put ‘‘equal’’ back into the Equal Access to 

Justice Act by requiring everyone to meet the same eligibility 

standards. 

To be clear, litigation will continue, but the taxpayer will no 

longer pay the legal bills of large interest groups. Capping eligibility on 501(c)(3)s will also make EAJA consistent with the other 

205 fee-shifting statutes, not one of which exempts 501(c)(3)s from 

the eligibility requirements that apply to private citizens and small 

business. 

Senior counsel, Henry Cohen, from the Congressional Research 

Service, in 2009 determined that EAJA was an anomaly in this regard. It is a glaring privilege that is the antithesis of equality and 

fairness. The antithesis of equality and fairness. Along with fairness, this bill will restore accountability and transparency to EAJA 

going forward. 

When EAJA was enacted in 1980, it required an annual report 

of the number of cases processed and total attorneys fees reimbursed. That reporting ended in 1995. Since then, the Congress 

and the country have been in the dark of the costs of EAJA, which 

is why this bill reinstates the reporting requirement beginning 

with an audit of prior unreported years. 

46 

Our own targeted research based on GAO reports, tax returns, 

court records, and data from agencies, shows costs of EAJA of at 

least $50 million per year from litigation by the top 20 environmental litigants. What are the total costs? We don’t know. That is 

why reinstating the annual reporting and audit costs since 1995 

are critical. 

In conclusion, the actual payout of legal fees is just the tip of the 

iceberg. We estimate that it represents one-fifth of the total costs. 

The hidden costs are the personnel time spent by agencies reviewing procedures, defending procedures, and often redoing the entire 

process. Then there are the costs of the Justice Department attorneys defending the cases. 

Mr. Chairman, Members of the Committee, this bill is about the 

historic purpose of EAJA. America’s conservation community urges 

you to put ‘‘equal’’ back into the Equal Access to Justice Act in the 

interest of fairness, sound management of our natural resources, 

and fiscal responsibility. Thank you for your consideration. 

Mr. COBLE. Thank you, Mr. Baier. 

[The prepared statement of Mr. Baier follows:] 

47 


Baier-1.eps
48 


Baier-2.eps
49 


Baier-3.eps
50 


Baier-4.eps
51 


Baier-5.eps
52 


Baier-6.eps
53 


Baier-7.eps
54 

Mr. COBLE. Ms. Ellis. 

TESTIMONY OF JENNIFER R. ELLIS, CHAIRMAN, 

WESTERN LEGACY ALLIANCE 

Ms. ELLIS. Mr. Chairman, Members of the Committee, I appreciate the ability to come before you today, and I have come to see 

why it is they asked me today. I am going to dumb this conversation down a lot. I hope you will appreciate my efforts there. 


Baier-8.eps
55 

More than 20 years ago I was a rancher in Idaho when an environmental group declared that its goal was to put myself and other 

ranchers out of business. Other conservationists who cared for the 

land had a better goal of how ranchers could change to do their 

business. This made sense to me. Even though we didn’t agree on 

the outcome all the time, we did agree to sit down at the table. 

Our self-appointed enemies brought a new and more aggressive 

campaign of lawsuits than we had ever seen before, so we formed 

the Western Legacy Alliance to allow ranchers, farmers, sportsmen, 

and local communities to defend their livelihoods. I started out 4 

years ago, when we started on this project, I thought that EAJA 

was how environmentalists got the money to file the lawsuits, but 

it is not. They have other much better sources of money. I thought 

that EAJA was the law that gave them access to the courts, but 

it is not. The major environmental laws give them access to the 

court for standing and to pay their fees. The Endangered Species 

Act, Clean Water Act, and Clean Air Act are all examples of that. 

EAJA seemed to be written just for the environmental groups, 

but it wasn’t. It was written for people like me—as Congressman 

Conyers and Congressman Cohen have made examples of small 

businesses, I am that small business—and also for people like my 

dad, who are Social Security recipients. I had no idea that there 

were 205 laws on the books that allowed fee shifts to occur, for 

groups to gain standing and then recoup their fees if they did prove 

the government was wrong, and none of these 205 laws exempt 

501(c)(3) organizations. 

In sum, I thought that if we repealed EAJA, then our problems 

would all be solved. Having spent years now learning about EAJA, 

I see it doing really good work for the retirees, the veterans, and 

small businesses. But it is also being used by groups that do not 

need it, and used in ways that make the controversies in the West 

and in Tennessee much more difficult on everybody involved than 

they need to be. 

Passing H.R. 1996 will make things better while protecting the 

proper use of EAJA. And a case out West in the Yellowstone Park 

is a really good example; maybe you have all heard of it, the snowmobile debacle. Tour businesses sued to overturn the first ban on 

the snowmobiles and they won. After the Park Service issued a 

new decision, the environmentalists sued the Park Service and 

won. The back-and-forth in court was disputing not whether the 

Park Service was breaking any laws but whether it had considered 

all of the options. It wasn’t about justice, it was about policy 

choices. 

I have always understood that people can push their agendas in 

court. I just disagree with using my tax dollars to do it. I support 

the GLSA even though it would prohibit some large business 

groups from collecting fees in the future. There are also other reasons that I support the GLSA. The bill improves EAJA for its intended users, which have been duly noted. It brings transparency 

and accountability to the costs of lawsuits. It separates EAJA from 

environmental policy, which is a completely separate issue. GLSA 

does these things by increasing allowable fees, focusing EAJA on 

direct and personal costs to people instead of to organizations, and 

56 

reporting the amounts distributed and preventing repeat claims by 

the same organizations over and over. 

EAJA is different from the Clean Air and Clean Water Act and 

the ESA. Environmental laws support lawsuits about whether the 

government has done what the law says it must do. EAJA pays for 

environmental cases if you can show the government messed up 

the paperwork, which is a pretty easy thing to do, if any of you 

have seen the NEPA documents and the APA documents. It is a 

real easy way to block decisions that you just don’t like. 

I urge the Committee to fix this by passing H.R. 1996 so that 

tax-exempt organizations have to pay their own way when they 

take on taxpaying businesses over differences of opinion. And I am 

actually on the receiving end of the collateral damage done by the 

misapplication of EAJA awards. 

With that, I will stand for any questions. Thank you. 

Mr. COBLE. Thank you, Ms. Ellis. I guess you probably came the 

greatest distance here today, Ms. Ellis, so we commend you for 

that. 

[The prepared statement of Ms. Ellis follows:] 

57 


Ellis-1.eps
58 


Ellis-2.eps
59 


Ellis-3.eps
60 


Ellis-4.eps
61 


Ellis-5.eps
62 


Ellis-6.eps
63 


Ellis-7.eps
64 

Mr. COBLE. Mr. Wolfman, good to have you with us. You are recognized for 5 minutes. 

TESTIMONY OF BRIAN WOLFMAN, VISITING PROFESSOR, 

GEORGETOWN UNIVERSITY LAW CENTER 

Mr. WOLFMAN. Chairman Smith and Members of the Subcommittee, thank you for the opportunity to appear today in oppoVerDate Aug 31 2005 14:32 Nov 10, 2011 Jkt 000000 PO 00000 Frm 00068 Fmt 6633 Sfmt 6601 H:\WORK\COURTS\101111\70668.000 HJUD1 PsN: DOUGA

Ellis-8.eps
65 

sition to H.R. 1996. In almost every particular, H.R. 1996 would 

undermine the purpose of EAJA to provide court access to citizens, 

citizens groups, and small businesses subjected to unreasonable 

and unlawful governmental conduct. 

I will focus today on two provisions of H.R. 1996 that would 

cause the most harm, but first I want to explain why claims that 

EAJA is being abused are dead wrong. In fact, EAJA is less favorable to a fee-seeking party than virtually any of the other more 

than 200 Federal fee-shifting statutes. 

First, under EAJA, to obtain a fee it is not enough for the plaintiff to prevail in the litigation, as it is under virtually all other feeshifting statutes. Rather, the government can defeat a fee award 

entirely if it can show that, despite having lost the case, its position on the merits of the case was substantially justified. The Supreme Court says this means that even when the government takes 

unlawful action against its citizens, it does not have to pay a fee 

unless the positions it took in court were unreasonable. This is a 

powerful defense, and dozens upon dozens of cases deny EAJA fees 

on this ground. So no rational litigant or lawyer would bring a frivolous or marginal case in the hope of obtaining a fee. 

Second, under EAJA, prevailing parties cannot recover their fees 

at market rates. Under other fee-shifting statutes, prevailing parties are awarded attorneys fees at market rates, which in D.C. and 

other major cities can range up to $600 per hour or more. But 

EAJA limits fees to about $180 per hour, after adjustment for inflation. Fees can be enhanced above that rate only when the Supreme 

Court has said are narrow circumstances involving specialized 

areas of the law, and even then the fee is not paid at market rates. 

In light of EAJA’s below-market rates, neither litigants nor lawyers 

would bring marginal cases in the hope of receiving fees. 

Let me turn to H.R. 1996’s two most concerning provisions. 

Under H.R. 1996, to obtain an EAJA fee, the fee applicant must 

have, quote, a direct and personal monetary interest in the case, 

unquote. This would eliminate EAJA in the most important cases, 

those that challenge unlawful governmental regulations and conduct that affect the public generally. Take, for example, cases 

where service organizations and members of the private bar help 

people who serve our country obtain needed disability benefits from 

the Department of Veterans Affairs. EAJA is vitally important to 

the individual veteran whose benefits have been unlawfully denied. 

But EAJA may be even more important to the thousands or tens 

of thousands of veterans whose benefits requests are mishandled 

because the Department of Veterans Affairs has systematically delayed issuing benefit rulings or misapplied disability regulations. 

H.R. 1996 would make it impossible to obtain fees in cases brought 

by nonprofit veterans groups challenging such illegal conduct. I set 

out a number of other examples in my written testimony. 

H.R. 1996 would discourage these important cases and unfairly 

require citizens to bear all of their legal costs when these types of 

cases are brought. 

The next section I want to talk about is that H.R. 1996 would 

amend EAJA to require a court to reduce or deny fees, quote, commensurate with pro bono hours, end quote. Pro bono refers to work 

performed by attorneys free of charge for people or charitable orgaVerDate Aug 31 2005 14:32 Nov 10, 2011 Jkt 000000 PO 00000 Frm 00069 Fmt 6633 Sfmt 6601 H:\WORK\COURTS\101111\70668.000 HJUD1 PsN: DOUGA
66 

nizations unable to afford market-rate services. The no pro-bono 

provision is a very bad idea because citizens and citizen groups 

that hire pro bono lawyers are exactly the parties for whom EAJA 

was designed. They cannot afford to pay for legal services and may 

only be able to hire lawyers if there is some chance of a fee down 

the road if they show that the government acted unreasonably. 

Hundreds if not thousands of members of the private bar provide 

their services, for instance, to Social Security and veterans disability claimants, with EAJA as the only monetary inducement to 

take on these cases. 

Nearly 10 years ago I worked with a private lawyer in North 

Carolina with a case in the Supreme Court. The lawyer was a veteran himself who wanted to give back to those in uniform. He represented another veteran who had been denied service-connected 

disability benefits. Ultimately, after years of litigation, the Court of 

Appeals for Veterans Claims found that the government’s position 

was wrong and, quote, not reasonably debatable, unquote. The government then fought us over the EAJA fee itself, which we ultimately won in the Supreme Court. 

Under H.R. 1996, there would have been no fight. There would 

be no EAJA fee because the time of the North Carolina lawyer was 

provided pro bono. Here you have a man who served his country, 

serving another man who served his country, who would, if H.R. 

1996 becomes law, have to think twice about taking on another veteran’s disability case. It is hard to think of a more unfair result, 

a result that would make it difficult if not impossible for people victimized by unreasonable government action to attract competent 

counsel. 

I would welcome any questions. Thank you. 

Mr. COBLE. Thank you, Mr. Wolfman. 

[The prepared statement of Mr. Wolfman follows:] 

67 


Wolf-1.eps
68 


Wolf-2.eps
69 


Wolf-3.eps
70 


Wolf-4.eps
71 


Wolf-5.eps
72 


Wolf-6.eps
73 


Wolf-7.eps
74 


Wolf-8.eps
75 


Wolf-9.eps
76 


Wolf-10.eps
77 


Wolf-11.eps
78 


Wolf-12.eps
79 


Wolf-13.eps
80 


Wolf-14.eps
81 


Wolf-15.eps
82 


Wolf-16.eps
83 


Wolf-17.eps
84 


Wolf-18.eps
85 


Wolf-19.eps
86 


Wolf-20.eps
87 


Wolf-21.eps
88 


Wolf-22.eps
89 


Wolf-23.eps
90 


Wolf-24.eps
91 


Wolf-25.eps
92 


Wolf-26.eps
93 


Wolf-27.eps
94 


Wolf-28.eps
95 


Wolf-29.eps
96 


Wolf-30.eps
97 

Mr. COBLE. Now, we try to comply with the 5-minute rule as 

well, so if you all will keep your answers as tersely as you can, we 

would appreciate that, we can move along. 

Mr. Axelrad, will H.R. 1996 adversely affect the ability of people 

seeking Social Security benefits and veterans benefits to collect 

what the government owes them? 

Mr. AXELRAD. No, it would not. 


Wolf-31.eps
98 

Mr. COBLE. Your microphone is not on. 

Mr. AXELRAD. Oh, I am sorry, excuse me. H.R. 1996 would not 

affect the right of the individual to recover the award that the 

court or administrative tribunal provides to a Social Security beneficiary. The difference is that EAJA as of now has a special incentive—depending on where the attorney is located actually, because 

the courts are divided on this—to pay attorneys more; and so the 

cap that is written into EAJA is often honored in the breach, so 

the money will go to an attorney. It doesn’t affect the rights of the 

individual to actually get the benefits of the award that the court 

determines. 

Mr. COBLE. Thank you, sir. Mr. Baier, how does the EAJA in its 

current form disrupt the balance, as you say in your written testimony, in environmental and conservation policymaking? 

Mr. BAIER. I am sorry, Mr. Chairman, I am having trouble hearing in this room. The last part of your—— 

Mr. COBLE. I will repeat it. How does the EAJA in its current 

form disrupt the balance, as you indicate in your written testimony, in environmental and conservation policymaking? 

Mr. BAIER. It encourages and incentivizes lawsuits over procedural issues, and by procedural issues what I mean are missing 

deadlines. That is the primary challenge to the way it works. These 

are procedural deadlines that are imposed primarily under the Endangered Species Act, which are physically and humanly impossible for the Fish and Wildlife Service to at times meet. And the 

litigation that we are concerned about that has created this imbalance is primarily over procedural issues that relate to missing 

deadlines and paperwork issues. 

Mr. COBLE. I thank you, sir. 

Ms. Ellis, when an environmental group sues the Federal Government, you discussed how ranchers in your organization end up 

paying three times for the same litigation. Elaborate on that, if you 

will. 

Ms. ELLIS. Yes, Mr. Chairman, that is what I referenced as collateral damage. When EAJA was enacted in 1980, it said that 

there would be no peripheral damage to anyone outside the government, the only hit to a pocketbook was going to be to the government, when in actuality now I hold permits on Federal land that 

I am allowed to under the Taylor Grazing Act. When environmentalists bring challenges to those permits, they don’t challenge 

me personally, they challenge the agency, we will use BLM as the 

example. So when they do that, they cannot—BLM attorneys cannot actually represent the losses that would happen to me if the 

change being requested by the plaintiff were enacted, and so I have 

to hire an intervening attorney that usually costs, for a good one 

right now, $400 an hour. So in order to have my interests represented when this lawsuit comes forward, I have to hire that attorney. I am from the Ninth Circuit, and usually they will not 

allow intervening attorneys in on the merits phase of the case, only 

in on the remedies phase. So I pay for my intervening attorney, 

then through my tax dollars I am paying for the agency attorney, 

the DOJ attorney, all of the staff time involved from the BLM conservation officers, and everybody preparing for the case. And then 

99 

my tax dollars pay the EAJA award if they are found to be the winner in the complaint. 

Mr. COBLE. I thank you. Let me try to beat that red light, Mr. 

Wolfman. From your written testimony it seems that you basically 

support the reporting provisions of H.R. 1996, but that the bill puts 

the cart before the horse. What evidence, if any, could convince you 

to support eliminating the exception to EAJA for multimillion-dollar organizations? 

Mr. WOLFMAN. Well, I don’t know that there is any, but I would 

like to see what the—— 

Mr. COBLE. Pull that microphone a little closer to you, Mr. 

Wolfman. 

Mr. WOLFMAN. I am sorry, Mr. Chairman. 

Mr. COBLE. It is okay. 

Mr. WOLFMAN. I don’t know. I would like to see the evidence 

first. What I was saying in my testimony is, I am all for transparency, and I do agree that it was unfortunate that, after 1995, 

we did not have an annual report. I myself used it frequently. It 

was a useful document, and there is nothing wrong with that. 

What I was saying in my testimony is I find it odd people are complaining about a paucity of data, but they are willing to change the 

substantive law of EAJA without having the data. That puts the 

cart before the horse. 

Mr. COBLE. I gotcha. I see that the red light appears. We have 

been joined by the distinguished gentleman from South Carolina, 

Mr. Gowdy. Good to have you with us, Trey. And Mr. Cohen, you 

are recognized for 5 minutes. 

Mr. COHEN. Thank you, Mr. Chairman. Mr. Axelrad, the first 

question that the Chairman asked you was about people getting 

their benefits, and I think it was veterans, and you said they get 

their benefits, if I am correct, but they just—the attorney wouldn’t 

get their attorneys fees; is that kind of what you said? 

Mr. AXELRAD. What I meant to say, I can’t exactly quote myself, 

is that the individual who receives an award receives the entire 

award. 

Mr. COHEN. Right. 

Mr. AXELRAD. And so the issue is for—and the changes in the 

terminology go to the compensation for the attorney, not the individual who receives the award. 

Mr. COHEN. Right. And I can get—where are you from? 

Mr. AXELRAD. Where am I from? 

Mr. COHEN. Yeah. 

Mr. AXELRAD. Originally from Uniontown, Pennsylvania. I have 

lived here for quite some time. 

Mr. COHEN. All right. Well, if I wanted to go to Uniontown, 

Pennsylvania, and the law said I could do it but said I couldn’t 

have transportation, I would have to walk there. It would make it 

a lot harder to get to Uniontown. If your attorney can’t get an expectation of getting a fee, you are not going to get an attorney, and 

if you can’t get an attorney, you are not going to get a fee. 

Mr. AXELRAD. Let’s take the Social Security example that you 

proposed. There actually is a separate fee provision for Social Security benefits. What EAJA does, it provides suspenders when there 

is already a belt. But I am not suggesting that EAJA not apply to 

100 

Social Security cases. All I am suggesting is that the provisions of 

EAJA have been broadened so that the exception has almost become the rule. The cap is being pierced, the 501(c)(3) organizations—— 

Mr. COHEN. You mean the cap of a hundred and a quarter or so 

an hour? 

Mr. AXELRAD. Beg pardon? 

Mr. COHEN. The cap of the dollar amount? 

Mr. AXELRAD. Right now it is at $125 an hour. 

Mr. COHEN. Right. And Ms. Ellis just said you can’t get a good lawyer in Idaho for $400. So how are you going to get a good lawyer in Washington for $126? 

Mr. AXELRAD. Social Security decisions, for example, are based 

on the administrative record, I am sure there are—the new cap 

under H.R. 1996 would be $175 an hour. I don’t think there would 

be any difficulty whatsoever, and in fact—— 

Mr. COHEN. Are you a lawyer, sir? 

Mr. AXELRAD. Oh, yes. 

Mr. COHEN. But you don’t practice? 

Mr. AXELRAD. I don’t litigate. I do have a very limited practice. 

Mr. COHEN. Even in poor old Memphis, Tennessee, the most poverty stricken of the 60 major cities, unfortunately, you can’t get a 

lawyer to go to traffic court for you for $175. 

Mr. AXELRAD. I think there may be a misapprehension on the 

501(c)(3) organizations. All that H.R. 1996 does is it provides the 

same net-worth cap that applies to other entities. It is not saying 

that the impoverished organization can’t avail itself of EAJA. It is 

the one that has a high net worth that is not able to pierce the 

cap—— 

Mr. COHEN. Let me ask you a question. In your testimony—— 

Mr. AXELRAD [continuing]. Under the bill. 

Mr. COHEN. Thank you, sir. In your testimony you say these limitations and conditions have not been successful in cabining—which 

is a new word for me, I guess, cabining; I will work on it—awards, 

and have led to substantial, unproductive, tangential litigation. 

What is the substantial, unproductive, tangential litigation you are 

referring to? 

Mr. AXELRAD. Over whether the—— 

Mr. COHEN. Give me a case. 

Mr. AXELRAD. Well, I cite several in my testimony where the 

issue is whether the Supreme Court’s comment that the kind of 

specialty that would warrant piercing the cap is something like 

patent law where there is special expertise needed. 

Mr. COHEN. Right. 

Mr. AXELRAD. Well, some courts have said that litigating Social 

Security cases is a specialty that sometimes warrants piercing the 

cap. Other courts have disagreed. So the courts get into litigation 

over exactly what is the kind of specialty that permits piercing the 

cap. 

When Congress enacted the cap, it was clear that they thought 

the cap would limit the amount paid by the taxpayers in the broad 

run of EAJA cases. It turns out, because even though the Supreme 

Court tried to—by cabining it, I mean reduce the degree of ability 

to litigate exceptions to the cap. It didn’t work, and despite the cap, 

101 

despite the Supreme Court decision, there are lots and lots of cases 

going every which way where the attorneys have been able to succeed in getting a greater attorney fee and fighting over how they 

can—— 

Mr. COHEN. We have gotten to the red light. 

Mr. AXELRAD [continuing]. Pierce it. 

Mr. COHEN. So, yes, thank you, sir. 

Mr. COBLE. Thank you, Mr. Cohen. The gentleman from South 

Carolina, Mr. Gowdy, is recognized for 5 minutes. 

Mr. GOWDY. Thank you, Mr. Chairman. Professor Wolfman, who 

decides whether the government position was substantially justified? 

Mr. WOLFMAN. Either the court or the agency adjudicator, depending on whether it is an administrative case or a court case. 

Mr. GOWDY. Who has the burden of proof? 

Mr. WOLFMAN. The government has the burden to show its position was not substantially justified, but in practice that makes no 

difference because there is no factual determination, so burdens 

usually only matter when facts are at stake. It is a legal question. 

Mr. GOWDY. Well, what is the standard of proof by which it must 

be proven? 

Mr. WOLFMAN. A preponderance of the evidence, just like any 

other civil matter. 

Mr. GOWDY. You mentioned a few moments ago the importance 

of having data, so I am hopeful you will have the data for this because I don’t. The percentage of cases where plaintiffs prevailed 

but the court said the government’s position was substantially justified? 

Mr. WOLFMAN. That is an interesting question, and in the area 

of the Social Security and veterans cases, particularly veterans 

cases, it is very high that the—it usually doesn’t even go to court, 

the agency typically settles. 

Mr. GOWDY. What about environmental cases? 

Mr. WOLFMAN. But in non-Social Security and veterans cases, I 

haven’t done a study, so I am just—based on my experience, the 

government wins often. I cite just—what I did in my testimony is 

that I just said I am looking for cases in recent years in Courts of 

Appeals where the court found a reasonable—— 

Mr. GOWDY. No, I think you did a good job with anecdotal evidence. I was looking for statistical evidence. 

Mr. WOLFMAN. I don’t know of any study on that, I don’t know 

of any study that—I know in the non-Social Security—— 

Mr. GOWDY. You do not know what percentage of time plaintiffs 

prevailed but still were not allowed to recoup fees because a finder 

of fact—— 

Mr. WOLFMAN. I do not. I don’t know that anyone knows that. 

It would be, again, an interesting study. But I will say this, because I know it for a fact, is that in the non-Social Security and 

veterans areas, it is much higher than in those other areas. 

Mr. GOWDY. You once, I believe, and I don’t want to 

mischaracterize your positions because I didn’t know you in 1994, 

but you once, I believe, supported the notion of doing away with 

the special factor exemption. Do you still support that? 

102 

Mr. WOLFMAN. What I said was at that time—and I would have 

to look back for sure—is that if we chose a more reasonable rate 

that could go up with inflation, actual fees in the real market, as 

opposed to what has occurred, yes, because—— 

Mr. GOWDY. Right. I think you said $175; if we go up to $175 

we would do away with it. 

Mr. WOLFMAN. Yes, but that—yes, but with all respect, that 

would not be the case. 

Mr. GOWDY. I am just asking you if you said it, I am not asking 

if you meant it. 

Mr. WOLFMAN. No, but with all respect that was $175 in 1994 

dollars. 

Mr. GOWDY. Two hundred fifty dollars. 

Mr. WOLFMAN. That is correct, if we were at $250— 

Mr. GOWDY. What if we went up to $250, would you do away 

with it then? 

Mr. WOLFMAN. I think if we were at $250 an hour and we had 

a reasonable inflation adjuster, right—— 

Mr. GOWDY. We just adjusted for inflation, we just bumped it 

from $175 to $250. 

Mr. WOLFMAN. Right. And if you had a mandatory reasonable inflation adjuster, I am with you on this. 

Mr. GOWDY. Then you would be fine doing away with it? 

Mr. WOLFMAN. I think that would be reasonable rather than necessarily what we have now. We have to appreciate that in the vast 

majority of the cases, the vast majority of the cases, what attorneys 

get and the clients get is the basic EAJA rate plus an inflation adjuster, except the agencies, which largely don’t do any inflation adjustment. 

Mr. GOWDY. All right, let me ask you this because I am running 

out of time quickly. I think you said there are 203 instances where 

we have something other than the American rule with respect to 

litigation in—— 

Mr. WOLFMAN. Someone else said 203. I know it is approximately 

200, yes. 

Mr. GOWDY. Are you an advocate for abolishing the American 

rule in all litigation and letting the finder of fact decide whether 

or not attorney—— 

Mr. WOLFMAN. Absolutely not. Absolutely not. I think if you 

had—— 

Mr. GOWDY. You hadn’t heard my idea yet. Why don’t we let the 

finder of fact decide whether or not litigation was frivolous or vexatious? 

Mr. WOLFMAN. Well, I can answer your question if you will allow 

me. 

Mr. GOWDY. I am going to. I just—I wanted to get my question 

out. 

Mr. WOLFMAN. I think having essentially the rule in Great Britain would deny ordinary action. 

Mr. GOWDY. That is not—what I just laid out is not Great Britain’s rule. I didn’t say loser pays. I said the finder of fact decides, 

the same group that we let decide capital cases, the same group 

that we let decide whether there is liability in a medical malVerDate Aug 31 2005 14:32 Nov 10, 2011 Jkt 000000 PO 00000 Frm 00106 Fmt 6633 Sfmt 6601 H:\WORK\COURTS\101111\70668.000 HJUD1 PsN: DOUGA
103 

practice case or products case, let the finder of fact decide whether 

or not the lawsuit was frivolous or vexatious. 

Mr. WOLFMAN. Well, first of all—— 

Mr. GOWDY. That is not the British rule, agreed? 

Mr. WOLFMAN. That is correct. 

Mr. GOWDY. Okay. 

Mr. WOLFMAN. I didn’t know that is what you were saying, but 

I will say two things about that. First of all, that is already the 

law in the sense that—— 

Mr. GOWDY. Well, wait a second. Can you name me a single 

time—how many times when summary judgment is granted or a 

motion to dismiss is granted does the judge then award attorneys 

fees for filing a frivolous lawsuit? In what percentage of the cases 

does that happen? 

Mr. WOLFMAN. A very small percentage because there is not—— 

Mr. GOWDY. Well, then we don’t have that rule. 

Mr. WOLFMAN. Well—Excuse me? 

Mr. GOWDY. Well, then we don’t have the rule. 

Mr. WOLFMAN. We do have that rule. With all respect, we do 

have that rule. Rule 11 applies in every piece of civil litigation. 

Mr. GOWDY. How many times has it been enforced? In summary 

judgment cases and just for the viewer, that is where there is no 

dispute over fact, just the law, what percentage of time in summary judgment cases are sanctions administered for frivolous lawsuits? 

Mr. WOLFMAN. Well, not often. But with all respect, I don’t think 

that proves anything, because all that means is there are not that 

many frivolous cases on purely legal matters. 

Mr. GOWDY. Well, then we don’t need rule 11. 

Mr. WOLFMAN. Huh? 

Mr. GOWDY. Well, then we must not need rule 11 if there are no 

frivolous lawsuits. 

Mr. WOLFMAN. I didn’t say there were none. Rule 11 provides an 

important incentive. But let me give you the other reason why I 

think that would be a poor idea. If you decided fee shifting at the 

back end, right, if you decided frivolity at the back end only, and 

didn’t have the 200 fee-shifters at the front end, you wouldn’t have 

the encouragement that these fee-shifters provide at the front end 

to give litigants to enforce our important civil rights, environmental and consumer laws. 

Mr. GOWDY. We lose an incentive to litigate, to bring a lawsuit, 

because there may be a penalty on the back end if you lose. 

Mr. WOLFMAN. This is a debate that people can have. The Congress of the United States has decided that it is important on the 

front end in over 200 instances to provide that incentive. 

Mr. GOWDY. You are right. And I am asking you if it is important 

in the rest of all the category of cases if it does well in these 200. 

Mr. WOLFMAN. I think probably not. In my judgment it makes 

sense for the Congress to decide which types of litigation it wants 

to incentivize, and not do it on an across-the-board basis. 

Mr. GOWDY. My time has expired. Thank you, Mr. Chairman. 

Mr. COBLE. The distinguished gentleman from Michigan, Mr. 

Conyers. 

104 

Mr. CONYERS. Thank you, Chairman Coble. I would like to start 

with Mrs. Ellis, please. Mrs. Ellis, have you ever used the legal 

services provided by a nonprofit? 

Ms. ELLIS. No, sir. 

Mr. CONYERS. So then you have never had the opportunity to 

take advantage of the Equal Access to Justice Act’s fee provision? 

Ms. ELLIS. No, sir. 

Mr. CONYERS. All right. Thank you. 

Now, for Mr. Baier. I am the one that sent you a list, Mr. Baier, 

of groups that have sent us notice that they strongly oppose Government Litigation Savings Act, H.R. 1996. Do you have that list 

in front of you? 

Mr. BAIER. I do, Representative Conyers, yes. 

Mr. CONYERS. Okay. Now, look on these 3—4 pages. I think you 

will find that there are 46—64, 65 organizations that are conservation organizations. I started noting them. The first I put a number 

one by, Alaska Wilderness League; and then number two, the Big 

Black Foot River Keeper; and number three, Butte Environmental 

Council. Do you see those? Do you see those numbers? 

Mr. BAIER. I do. 

Mr. CONYERS. Okay. And out of this over 100, 65 of them are environmental organizations. Now, take a look, just scan them. Do 

you recognize any of those organizations? 

Mr. BAIER. Congressman Conyers, yes, I recognize a few of these, 

yes. 

Mr. CONYERS. Sure. They have a position of opposition to this 

bill. Is there any possible rationale you could suggest for this many 

people that work in the same field that you do, or did work, in having so different a view from you about the bill that we are discussing today? 

Mr. BAIER. I do, sir. 

Mr. CONYERS. Please tell me what it is. 

Mr. BAIER. Well, I note that some of our larger, more recognizable environmental groups in the country are on this list such as 

the Environmental Defense Fund. The Environmental Defense 

Fund—and Defenders of Wildlife are on here as well. Defenders of 

Wildlife have a net worth of $23.7 million. 

Mr. CONYERS. Oh, that is terrible. 

Mr. BAIER. And that would put them, make them ineligible 

under this bill. Others fall into that same category. For example, 

Earth Justice. 

Mr. CONYERS. Okay, that is two. But we got 65. 

Mr. BAIER. Well, I would have to analyze it, Congressman, to better respond. 

Mr. CONYERS. I will give you that list to take home with you. 

And you send it back to me, the ones that you recognize. And if 

you think that you—I assume that you are saying because they 

have so much money they can afford to be against this bill. 

Mr. BAIER. Well—— 

Mr. CONYERS. Is that the inference that I am to draw from your 

explaining to me how big and rich this group is? 

Mr. BAIER. Well, if I understand your question, sir, some of the 

larger ones on this list have net worths—for example, the Humane 

Society of the United States has a net worth of $160 million. 

105 

Mr. CONYERS. Now, that is really bad. So what? 

Mr. BAIER. Excuse me, I am sorry. 

Mr. CONYERS. Yeah. I said, so what? 

Mr. BAIER. Well, as I understand your question, you were wondering why they would oppose the bill. 

Mr. CONYERS. Yes. 

Mr. BAIER. And I would suggest, sir, because the bill would disqualify them from utilizing EAJA on procedural litigation. 

Mr. CONYERS. But they were disqualified before this bill. They 

are disqualified now, aren’t they? 

Could I get 1 minute, Chairman Coble? 

Mr. COBLE. Without objection. 

Mr. CONYERS. Okay. I just want to get one question in to Professor Axelrad if I can. Is it not true, sir, that on pages 3 and 8, 

in the first section on page 3 and the top section on page 8, that 

both of these amounts—oh, well, this is the only bill we have got. 

Aren’t these the two places that deny pro-bono fees to lawyers who 

win awards, and specifically in this bill on page 3, the top, and 

page 8? 

Mr. AXELRAD. You are referring to page 3 of the bill? 

Mr. CONYERS. I am. 

Mr. AXELRAD. Your citations appear to be correct to me. 

Mr. CONYERS. Yeah. Well, thank you. And you agree that this is 

the way you would want to go even though there are over 100 

groups, and not all environmental, some just nonprofits, that think 

that this is a bill that should not advance beyond this Committee? 

Mr. AXELRAD. I support the entire bill. I did not in my statement 

address the particular provision you are addressing now. I see the 

overall purpose of the bill as in keeping with the principle that the 

EAJA is an exception. It is a one-way, loser-pay provision in relevant part that doesn’t otherwise exist. If a person who makes a 

claim for money or nonmonetary relief from the government and 

loses a claim, it doesn’t matter whether the person had substantial 

justification or not, because the American public can’t recover its 

costs in defending against that unsubstantial claim, whereas EAJA 

provides the opposite against the—— 

Mr. CONYERS. Do you know, sir, that you have to win the case 

before the attorney can get—she shakes her head no. You don’t 

have to win? You can lose the case in claim fees? 

Mr. AXELRAD. Many attorneys do not work on a contingency 

basis. 

Mr. CONYERS. Well, on a pro-bono basis you can’t work on a contingency. The client doesn’t have any money. 

Mr. AXELRAD. If someone is working on a pro-bono basis, they 

are working without an expectation of compensation. That to me is 

what the term ‘‘pro bono’’ means. 

Mr. CONYERS. But that is exactly why we have this provision in 

the law, is that if a pro-bono lawyer takes the case and prevails, 

the court can award him legal fees. You object to that? 

Mr. AXELRAD. I think that the—exceptions to the American rule 

that Congress created in EAJA should be narrowly confined. I have 

not specifically addressed this rule, but I favor the general principles that H.R. 1996 introduces. 

106 

Mr. CONYERS. Would you, Mr. Chairman, give me the time, 1 

minute more, to ask the other witness? 

Mr. COBLE. Without objection. 

Mr. CONYERS. Thank you very much. Can you help us, sir, Mr. 

Wolfman, about who gets pro-bono fees and who doesn’t under this 

rule and in the general practice of law in the United States? 

Mr. WOLFMAN. So one of the things I think, thankfully, that has 

occurred in this country when lawyers are able to do it, is they provide their services to the poorest among us, the neediest, the people 

who are in the most difficult circumstances, on a pro-bono basis. It 

has always been the case that if there is a fee-shifting statute involved and the person prevails, and in the case of EAJA also the 

government’s position is not substantially justified, it has always 

been the case that the pro-bono lawyer can have at least some 

prospect of and recovering a fee in that circumstance. 

Mr. CONYERS. But if he wins. 

Mr. WOLFMAN. This provision—yes. Not only do you have to win, 

but under EAJA you have to effectively show that the position of 

the government is not reasonable. But what this bill would do, 

among other things that I think are unfortunate, it specifically says 

that the court shall reduce or deny all fees to the extent commensurate with pro-bono hours. So the pro-bono lawyers, many of 

whom are in this very city, that are willing to take on a veterans 

case, a Social Security case, or other cases—I just use those two examples—on a pro-bono basis can’t get fees under EAJA. It says 

that. I mean, I am not making this up. That is what the bill says. 

Mr. COBLE. The gentleman’s time has expired. 

Mr. CONYERS. And I thank the Chairman for his generosity. 

Mr. COBLE. You are indeed welcome. 

We want to thank the witnesses for their testimony today. 

Without objection, all Members will have 5 legislative days to 

submit to the Chair additional written questions for the witnesses 

which we will forward and ask the witnesses to respond as promptly as they can so that their answers may be made a part of the 

record. Without objection all Members will have 5 legislative days 

to submit any additional material for inclusion in the record. 

[The information referred to follows:] 

With that, again, I thank the witnesses and the hearing stands 

adjourned. 

[Whereupon, at 4:50 p.m., the Subcommittee was adjourned.] 

(107) 

A P P E N D I X 

MATERIAL SUBMITTED FOR THE HEARING RECORD

Prepared Statement of the Honorable Steve Cohen, a Representative in 

Congress from the State of Tennessee, and Ranking Member, Subcommittee on Courts, Commercial and Administrative Law 


70668D-1.eps
108 


70668D-2.eps
109 


70668D-3.eps
110 


70668D-4.eps
111 


70668D-5.eps
112 


70668D-6.eps
113 

f 


70668D-7.eps
114 


70668E-1.eps
115 


70668E-2.eps
116 

f 


70668E-3.eps
117 


70668F-1.eps
118 

f 


70668F-2.eps
119 

f 


70668G.eps
120 


70668H-1.eps
121 


70668H-2.eps
122 

f 


70668H-3.eps
123 


70668I-1.eps
124 

f 


70668I-2.eps
125 

f 


70668J.eps
126 


70668K-1.eps
127 

f 


70668K-2.eps
128 


70668L-1.eps
129 


70668L-2.eps
130 

Æ 


70668L-3.eps