Opinion ID: 210574
Heading Depth: 2
Heading Rank: 3

Heading: Denial of the Renewed Motion to Dismiss

Text: 10 The Government also cross-appeals the Court of Federal Claims' refusal to dismiss the case in response to the revised proposed corrective action, which included both Chapman and Greenleaf in the small business tier. 11 Rather than granting the motion to dismiss, the Court of Federal Claims entered judgment in favor of Chapman and Greenleaf. In so doing, the Court of Federal Claims stated that Chapman and Greenleaf materially altered the legal relationship among the parties. Chapman II, slip op. at 2. Considering that [g]ranting [the Government's] renewed motion to dismiss might limit Chapman, and possibly Greenleaf, from applying for attorneys' fees, the Court of Federal Claims entered judgment to leave open the opportunity of applying for such fees. Id. 12 In its holding, the Court of Federal Claims appears to have borrowed language from Buckhannon Board and Care Home, Inc. v. West Virginia Department of Health and Human Resources, 532 U.S. 598, 605, 121 S.Ct. 1835, 149 L.Ed.2d 855 (2001), in which the Supreme Court rejected the use of the catalyst theory as justification for the recovery of attorney fees. In Brickwood Contractors, Inc. v. United States, 288 F.3d 1371, 1380 (Fed. Cir.2002), we held that this rejection extended to the EAJA fee context as well. Under the catalyst theory, a plaintiff is considered a prevailing party if it achieves the desired result because the lawsuit brought about a voluntary change in the defendant's conduct-no judicially sanctioned change in the legal relationship of the parties is required. In Buckhannon, the Supreme Court rejected this theory, saying that 13 [a] defendant's voluntary change in conduct, although perhaps accomplishing what the plaintiff sought to achieve by the lawsuit, lacks the necessary judicial imprimatur on the change. [Precedent] counsel[s] against holding that the term `prevailing party' authorizes an award of attorney's fees without a corresponding alteration in the legal relationship of the parties. 14 532 U.S. at 605, 121 S.Ct. 1835. 15 Merely stating that there has been an alteration in the legal relationship of the parties as the Court of Federal Claims did, however, is insufficient, by itself, to avoid running afoul of the Supreme Court's pronouncement in Buckhannon; our precedent requires that there must be an actual, court-ordered alteration in the legal relationship in the parties in the form of an entry of judgment or a consent decree. See Brickwood, 288 F.3d at 1380. 16 Here, the court's entry of judgment was not only unnecessary, it was improper. None of the parties objected to the substance of the revised proposed corrective action. The only opposition to the Government's motion to dismiss was raised by Chapman, and that was only because Chapman wanted attorney fees. In fact, Chapman indicated it was amenable to a dismissal—provided the court indicated it was a prevailing party for EAJA purposes. 17 Although securing attorney fees may understandably affect a party's litigation strategy, the availability of EAJA fees is not an appropriate consideration for a court when determining how to dispose of a case. When, during the course of litigation, it develops that the relief sought has been granted or that the questions originally in controversy between the parties are no longer at issue, the case should generally be dismissed. And while the Supreme Court has recognized an exception to this rule when the defendant voluntarily ceases the challenged practice, see Ne. Fla. Chapter of the Associated Gen. Contractors of Am. v. City of Jacksonville, 508 U.S. 656, 662, 113 S.Ct. 2297, 124 L.Ed.2d 586 (1993), the exception does not apply to this case. 1 As explained in County of Los Angeles v. Davis, 440 U.S. 625, 631, 99 S.Ct. 1379, 59 L.Ed.2d 642 (1979), the voluntary cessation exception may be refuted when there clearly is no reasonable expectation that the alleged violation will recur and interim relief or events have completely and irrevocably eradicated the effects of the alleged violation. (Citations omitted). 18 Here, the Court of Federal Claims had already determined that the revised corrective action was reasonable, and was required to assume that the Government would carry out the corrective action in good faith. See T & M Distribs., Inc. v. United States, 185 F.3d 1279, 1285 (Fed. Cir.1999) (Government officials are presumed to act in good faith, and `it requires well-nigh irrefragable proof to induce a court to abandon the presumption of good faith.' (quoting Kalvar Corp. v. United States, 211 Ct.Cl. 192, 543 F.2d 1298, 1301-02 (1976))). The revised corrective action adequately addressed the effects of the challenged action, and the Court of Federal Claims had no reasonable expectation that the action would recur. Accordingly, the Court of Federal Claims should have dismissed the case. Entering judgment for plaintiffs was, therefore, improper.