USDA Litigation: Limited Data Available on USDA Attorney Fee Claims and Payments
Released: 2014-03-26T00:00:00

Letter

Background

USDA has a broad and far-reaching mission—including improving farm economies and the nation’s nutrition, enhancing agriculture trade, and protecting the nation’s natural resource base and environment—and the department may face the prospect of litigation over its regulations and other actions. As with other federal agencies, where USDA is engaged in judicial litigation—cases brought in a court, including those that are settled—as a plaintiff or a defendant, the Department of Justice (DOJ) and USDA provides technical generally provides legal representation,and subject matter expertise and assists with the case, such as by drafting documents for DOJ to file and conducting research.

The types of actions that involve USDA are varied. For example, lawsuits may involve challenges to certain agency actions—such as under provisions of the Endangered Species Act, which permits parties to file challenges to government actions affecting threatened and endangered species, or under the National Environmental Policy Act, which requires federal agencies to prepare a statement identifying the environmental effects of major actions they are proposing or ones for which third parties seek federal approval or funding and that significantly affect the environment. Cases may involve other statutes, such as title VII of the Civil Rights Act, which prohibits discrimination in employment. Additionally, the Administrative Procedure Act authorizes challenges to certain agency actions that are considered final actions, such as rulemakings and decisions on permit applications.

With respect to the payment of attorney fees, in the context of judicial cases, the law generally provides for three ways that prevailing parties can be eligible for the payment of attorney fees by the federal government. First, many statutes contain provisions authorizing the award of attorney fees from a losing party to a prevailing party; many of these provisions apply to the federal government. Second, where there is a fee-shifting statute that allows for the payment of attorney fees by a losing party to a prevailing party but is not independently applicable to the federal government, EAJA provides that the government is liable for reasonable attorney fees to the same extent as a private party (i.e., claims paid under EAJA subsection (b)).

Under these first two ways, when a party prevails in litigation against the government and is awarded attorney fees under court order or settlement, the amounts generally are paid from the Department of the Treasury’s (Treasury) Judgment Fund (a permanent, indefinite appropriation that pays judgments against federal agencies that are not otherwise provided for by other appropriations). Third, EAJA provides that in any civil action where there is no fee-shifting statute, prevailing parties generally shall be awarded attorney fees when the government cannot prove that its action was substantially justified (i.e., claims paid under EAJA subsection (d)).settlements are paid from the losing agency’s appropriation.

In adversary administrative adjudications—generally, proceedings that are brought in a special agency forum, rather than in a court, and in which the government position is represented—a separate provision of EAJA applies. Specifically, EAJA provides that in adversary adjudications, the government is liable to a prevailing party for reasonable attorney fees when the government cannot prove that its action was substantially justified. When such fees are awarded or agreed to in a settlement, they are generally paid from the agency’s appropriated funds.

In this statement, we refer to attorney fees anytime fees were paid, regardless of the source of law authorizing the payment—independently applicable statutory fee-shifting provisions, EAJA subsections (b) or (d), or EAJA’s adversarial adjudication provisions—and whether awarded by a court or administrative forum or provided in a settlement. The payment process differs, however, based on the statute involved and whether the award was made at the administrative level or through the courts, as shown in figure 1.

Most USDA Agencies Did Not Have Readily Available Attorney Fee Information

In April 2012, we found that USDA did not report any aggregated data on attorney fee claims and payments made under EAJA and other fee- shifting statutes for fiscal years 2000 through 2010, but USDA and other key departments involved—Treasury and DOJ—maintained certain data on individual cases or payments in several internal agency databases. However, collectively, these data did not capture all claims and payments. USDA officials stated at the time that given the decentralized nature of the department and the absence of an external requirement to track or report on attorney fee information, the information was not centrally tracked and decisions about whether to track attorney fee data and the manner in which to do so were best handled at the agency level.

Accordingly, for our April 2012 report, we contacted 33 agencies within USDA to obtain their available attorney fee information. In response, officials from 29 of the 33 USDA agencies told us that they did not track or could not readily provide us with this information. These officials generally stated that this is because their agencies deal with few or no attorney fee cases, the payment amounts are minimal, another agency within the department tracked this, or the agency did not need this information for internal management purposes. For example, an Acting Director in the USDA Farm Service Agency stated that because so few cases are filed against the agency, there is little value in tracking the data. We reported that the remaining 4 USDA agencies we contacted either had mechanisms to track information on attorney fees, or were able to compile this information manually using hard copy files, or directed us to publicly available sources where we could obtain the information. These four agencies were: (1) the National Appeals Division (NAD), an agency that conducts hearings of administrative appeals of adverse actions by certain USDA agencies; (2) the Office of Assistant Secretary for Civil Rights (OASCR) an agency that adjudicates employee discrimination complaints; (3) USDA’s Office of Administrative Law Judges (OALJ); and (4) the Forest Service, which is responsible for managing its lands for various purposes—including recreation, grazing, and timber harvesting— while ensuring that such activities do not impair the lands’ long-term productivity. In our April 2012 report, we identified one program agency at USDA—the Forest Service—that maintained attorney fee data. The Forest Service maintained the data in two different information sources: (1) a spreadsheet that tracked the amounts of attorney fees and costs awarded or settled, among other items, for environmental litigation, including cases filed under the National Environmental Policy Act, the National Forest Management Act, and the Endangered Species Act; and (2) a separate accounting code in the USDA financial database.discuss these two sources in further detail below. We reported that the attorney information maintained by these four agencies varied with respect to the time frame for which data were available, whether the agency had information on the amount awarded versus the amount paid, and the statutes under which the cases were brought, among other information.

Further, in April 2012, we reported that given the differences in attorney fee information available across the 4 USDA agencies and the limitations identified below, it was difficult to comprehensively determine (1) the total number of claims filed for attorney fees, (2) who received payments, (3) in what amounts, and (4) under which statutes. Specifically, we found:

The total number of claims filed for attorney fees could not be determined. Two USDA agencies—NAD and OALJ—that provided information on attorney fee data did not maintain data about claims for attorney fees that were filed but denied. As a result, we concluded that the number of claims filed may be understated for these agencies.

Information on who received the payment was not always recorded. Payment of attorney fees may be made to one or more parties or directly to the attorney. Agencies that had information on attorney fees sometimes identified a particular party in the case, as opposed to everyone who received payments. For example, we reported that the Forest Service spreadsheet listed 241 cases with attorney fees all of which identified the first-named party in the case, but 46 cases did not identify the payee. Given that attorney fees may be paid to the first named party, to other parties in the case, or to attorneys, we concluded that the first named party may not reliably identify who actually received the attorney fee payment.

Data on actual attorney fee payments made were not consistently available. We also reported that 2 of the 4 agencies— NAD and OALJ—provided information on award or settlement amounts rather than attorney fee payment amounts. Amounts awarded reflect the attorney fee award included in a decision or settlement, and amounts paid reflect the actual amount the agency paid. According to DOJ officials at the time, award or settlement amounts may differ from payment amounts because award amounts may increase because of added interest expense before payment is disbursed. Moreover, DOJ and agency officials stated that award or settlement amounts may increase or decrease as a result of subsequent legal proceedings (e.g., a prevailing party could appeal the award amount, and an appeal could change the amount the agency ultimately paid). In addition, decisions and settlement agreements may not separate attorney fees and costs from damages, a fact that prevents agencies and Treasury from knowing exactly how much was allocated for each purpose. We concluded that in these instances, the attorney fee amounts cannot be determined.

Statutes under which the case was brought were not always recorded. Last, we found that the Forest Service did not track information on the statutes underlying the award or payment because the Forest Service financial database does not have a statute field, and according to the official who collected the spreadsheet data, he did not research statute information because of time constraints. However, the Forest Service official estimated that between two-thirds and three-quarters of the Forest Service natural resource cases involve challenges under the National Environmental Policy Act, the National Forest Management Act, the Endangered Species Act, or a combination of these acts.

In our April 2012 report, we found that the Forest Service was the only program agency that was able to provide us with attorney fee data across the 11-year period and gathered information on attorney fees and cost awards associated with cases from three sources—Forest Service regional officials, a Forest Service-commissioned university study, and publicly available court documents. Forest Service officials maintained this information in a spreadsheet that tracked the amounts of attorney fees and costs awarded or settled, among other items, for environmental litigation, including cases filed under the National Environmental Policy Act, National Forest Management Act, and Endangered Species Act. Forest Service officials told us at the time that they undertook the effort to compile information on cases resulting in attorney fee and cost awards to provide internal guidance to Forest Service management. For example, we reported that the information on attorney fee and cost awards helped the agency make informed decisions on whether proposed fees in ongoing cases were reasonable in light of recent cases involving similar challenges. We also reported on several limitations of the data that were identified by the official who developed the spreadsheet. Specifically:

The list of cases was not intended to be a definitive list of all attorney fee and cost payments and the payments should be considered in totality rather than case by case.

The data include only environmental cases. Accordingly, nonenvironmental cases, such as those brought under the Freedom of Information Act (FOIA), Equal Employment Opportunity Act, and other civil rights statutes, were not included.

Not all of the attorney fees and costs included in the spreadsheet were paid from Forest Service appropriations, as Treasury may have paid some of the attorney fees and costs from its Judgment Fund.

In some instances, award or settlement amounts may be overstated. Specifically, court documents Forest Service officials reviewed to compile the data do not always break out award amounts to be paid by separate defendants. For example, if a party sued the Forest Service and Interior’s U.S. Fish and Wildlife Service and prevailed, both agencies might need to pay attorney fees and costs if they lost, but the court might not specify the amount each agency is to pay. In these instances, the data assumed the Forest Service paid the total amount.

Using the Forest Service’s spreadsheet data, we reported that about $16.3 million in attorney fees and costs in 241 environmental cases from fiscal years 2000 through 2010 was awarded against or settled by the Forest Service. Figure 2 shows the amounts of attorney fees awarded and number of cases at the Forest Service by fiscal year.

Figure 2 shows that the greatest number of cases was concluded in fiscal year 2006 (31 cases), and the awards against the Forest Service were greatest in 2007 ($2.3 million). Additionally, we reported that the awards ranged from $350 to about $500,000, and that larger awards may skew the data for the year in which the Forest Service made those awards or settlements. For example, in 2010, one payment accounted for over $400,000 of the $1.1 million (about 36 percent) in total awards.

Our April 2012 report found that in March 2009, the Forest Service began tracking EAJA payments under a separate accounting code in the USDA financial database, in addition to the Excel spreadsheet. These data show that the Forest Service paid about $2.3 million in 32 cases from March 2009 through September 2010. In April 2013, the Forest Service publicly reported information on the agency’s EAJA attorney fee payments. Specifically, in its fiscal year 2014 budget justification, the Forest Service reported that it had 15 EAJA cases in fiscal year 2011 (awarding about $1.5 million) and 11 cases in 2012 (awarding about $565,000). According to the Forest Service’s fiscal year 2015 budget justification, the agency had 18 EAJA cases in 2013, awarding about $1.6 million.

In April 2012, we also reported that Treasury maintains certain data on some USDA cases involving attorney fee payments. In judicial cases where payments from the Judgment Fund are authorized, DOJ officials submit the payment information to Treasury using standardized forms, and Treasury processes the payment and typically informs relevant agencies when it releases the payment to the payee. Specifically, we found that Treasury made 187 payments totaling $16.9 million on behalf of USDA from March 2001 through September 30, 2010. These payments were most frequently made in connection with litigation brought under the Equal Credit Opportunity Act, Title VII of the Civil Rights Act of 1964, FOIA, or the Endangered Species Act, as shown in table 1. Treasury made 88 of the 187 payments as a result of a class action lawsuit on behalf of black farmers alleging discrimination.

In April 2012, we also reported on the amount and number of payments Treasury made on behalf of USDA, by fiscal year, as shown in figure 3.

Specifically, figure 3 shows that Treasury made the greatest number of payments on behalf of USDA in fiscal year 2005 (24 payments) and Treasury paid the highest amount of attorney fees and costs on behalf of USDA in 2003 ($3 million). We found that the payments ranged from about $175 to about $1.1 million, and that larger payments may skew the data for the year in which Treasury made those payments. For example, in 2008, one payment totaling about $1.1 million accounted for about half of the $2.3 million in total payments. Further, 11 of the 13 fiscal year 2010 cases were payments stemming from a class action lawsuit filed by black farmers and made up about $1.5 million of the $1.6 million in payments for that year.

In addition, we found in April 2012 that DOJ maintains certain data on some USDA cases involving attorney fee payments, but DOJ’s data are not readily retrievable or complete. In particular, DOJ has internal agency databases that capture information on individual court cases, but officials stated at the time that these databases do not reliably capture attorney fees and costs. For example, we reported that DOJ officials said that their databases were designed for internal management purposes and not for agency-wide statistical tracking. Over time, some EAJA data have been entered into the databases; however, the agency does not have a mechanism for determining what percentage of total EAJA awards is in the database or if the data were entered consistently. According to a senior DOJ official, DOJ is not required to enter EAJA award data into its database. We concluded that because DOJ handled tens of thousands of cases over the 11-year period on behalf of USDA, we could not readily or systematically review all of the case files for our April 2012 review to determine the attorney fee awards.

Other costs includes court costs, such as filing fees and reporting fees, and attorney expenses, such as the cost for expert witnesses, telephone, postage, travel, copying, and computer research. litigation defending EPA.Resources Division’s case management system contains information on the number of hours the division’s attorneys spent working on environmental litigation defending EPA. However, we reported that the U.S. Attorneys’ Office’s database does not contain information on attorney hours worked by case, which meant that in our prior report on EPA litigation, we could not determine the time these attorneys spent on each case.

Specifically, the Environment and Natural Chairman Thompson, Ranking Member Walz, and members of the subcommittee, this completes my prepared statement. I would be happy to respond to any questions you may have at this time.

Contacts and Acknowledgments

For further information on this statement, please contact Eileen R. Larence at (202) 512-8777 or larencee@gao.gov. Contact points for our Offices of Congressional Relations and Public Affairs may be found on the last page of this statement. Individuals making key contributions to this statement include Maria Strudwick (Assistant Director), Paul Hobart, Ron La Due Lake, Jessica Orr, Janet Temko, and Ellen Wolfe.

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