Opinion ID: 714786
Heading Depth: 2
Heading Rank: 3

Heading: Retroactivity of a Waiver of Sovereign Immunity

Text: 23 The present case poses the question: Does the rule of strict construction also govern our analysis of whether an undoubted waiver of sovereign immunity is to be given retroactive effect? Brown argues that the retroactivity of a waiver may be analyzed differently from other aspects of the scope of the waiver; once we have determined that the statute waives sovereign immunity from interest on attorney's fees, we may resolve the question of retroactivity with reference to the usual rules of statutory interpretation. In view of the rationale for the rule of strict construction, however, we can see no reason why it should not constrain us equally whether we plumb the depth or measure the breadth of a waiver. We run the same risk of imposing upon the public fisc an unanticipated and potentially excessive liability, whether we hold that a statute waives sovereign immunity from an element of damages not contemplated by the Congress or we apply the waiver over a period that the Congress did not envision. See In re Jordan, 745 F.2d 1574, 1576 (D.C.Cir.1984) (holding attorney's fee amendment to Ethics Act not retroactive because [w]aivers of sovereign immunity must be strictly construed.... [T]he fact that the amendment does not specifically exclude retroactive fee applications is of little importance to our construction of the amendment); see also Woolf v. Bowles, 57 F.3d 407, 410 (4th Cir.1995) (Shaw 's reminder that waivers of interest immunity are to be strictly construed ... provides further support for our conclusion [that under Landgraf § 114(2) of the 1991 Act cannot apply retroactively to authorize interest on back pay against the Government]); Huey v. Sullivan, 971 F.2d 1362, 1365 (8th Cir.1992) (concluding that precursors to Landgraf bar retroactive application of § 114(2) in back pay cases, and noting that the policy requiring that waivers of sovereign immunity be construed strictly in favor of the United States ... makes a finding of no retroactivity even more compelling in this case). But see Campbell v. United States, 809 F.2d 563, 577 (9th Cir.1987), discussed in Part II.C.2 below. 24 As they relate to the question whether a statute is retroactive, then, it would seem that the Bradley presumption and the rule of strict construction are antipodal. In the usual case--that is, the case in which no waiver of sovereign immunity is involved--Bradley requires the court to presume that the newly enacted provision is retroactive; only where manifest injustice would result, or where the Congress can be seen to have intended otherwise, is that presumption rebutted. In the special case, however, in which the newly enacted statute is a waiver of sovereign immunity, the rule of strict construction requires the opposite: the statute is to be construed no more broadly than is required by its terms. 25 We considered and rejected the application of Bradley to a case involving the waiver of sovereign immunity in Nichols v. Pierce, supra. That case concerned the waiver of immunity in the Equal Access to Justice Act for attorney's fees incurred by plaintiffs in cases pending on, or commenced on or after October 1, 1981. Pub.L. 96-481, § 208, 94 Stat. 2321, 2330 (1980). The appellant had filed suit against the Government, and the substance of her claim had been fully litigated, long before that date. The only aspect of the case still pending on October 1 was the plaintiff's appeal from the district court's order denying her the attorney's fees she sought under the Freedom of Information Act. We concluded that the EAJA did not apply to a case in which the only matter still pending concerned a petition for the award of attorney's fees. 740 F.2d at 1261. Bradley was readily distinguishable: the United States was not the defendant in that case. Id. at 1258 (citing, inter alia, Commissioners of Highways v. United States, 684 F.2d 443, 443-45 (7th Cir.1982)); accord Tongol v. Donovan, 762 F.2d 727, 730-32 (9th Cir.1985) (following Nichols ); Commissioners of Highways, 684 F.2d at 444 (reaching same result in case similar to Nichols and distinguishing Bradley on ground it did not involve the issue of [the] sovereign immunity of the United States); Berman v. Schweiker, 713 F.2d 1290, 1301 n. 28 (7th Cir.1983) (Our observation in Commissioners of Highways that Bradley did not involve a sovereign immunity bar reflects a critical distinction between the two cases--one that required a different analysis of the retroactive fee issue ...); Van Meter v. Barr, 778 F.Supp. 83, 85-86 (D.D.C.1991); cf. Edwards v. Lujan, 40 F.3d 1152, 1153-54 & n. 1 (10th Cir.1994) (holding that § 114(2) does not apply retroactively to authorize interest on attorney's fees, based solely upon conclusory analogy to Landgraf ). Because the Court in Bradley was not faced with a purported waiver of sovereign immunity, it interpreted the new statute broadly, without insisting upon the special rule requiring narrow construction of such a waiver. In this case as in Nichols, however, we must insist upon it. 26 We do well to remember that principles of statutory construction are not ends in themselves; they are the tools with which we discern the intent of a legislature that has not made its intent explicit. In this case, which must be viewed against the background of Shaw, the failure of the Congress to be explicit puts into stark relief the importance of applying the rule of strict construction to each aspect of a waiver of sovereign immunity. Before the 1991 amendments, Title VII had provided simply that [i]n any action or proceeding under this subchapter the court, in its discretion, may allow the prevailing party ... a reasonable attorney's fee ... as part of the costs, and the [EEOC] and the United States shall be liable for costs the same as a private person. 42 U.S.C. § 2000e-5(k). This court held that because a court could award interest on the attorney's fee in a suit against a private employer, the just-quoted provision authorized the court equally in a case against the Government to award interest on the attorney's fee. The Supreme Court reversed, stating: The statute, as well as its legislative history, contains no reference to interest. This congressional silence does not permit us to read the provision as the requisite waiver of the Government's immunity with respect to interest. 478 U.S. at 319, 106 S.Ct. at 2964. The Court reaffirmed the rule that waivers must be construed strictly in favor of the sovereign and emphasized that the no-interest rule--the historical rule that interest is a separate element of damages and may be recovered only against a party that has agreed to be liable therefor--provides an added gloss of strictness upon the rule of strict construction. Id. at 318, 106 S.Ct. at 2963; see also Thompson v. Kennickell, 797 F.2d 1015, 1017 (D.C.Cir.1986) (These principles of sovereign immunity take on added force when applied to claims of interest against the United States, citing no-interest rule). Shortly thereafter, the Congress responded to Shaw by adding to Title VII an express waiver of sovereign immunity from interest. Notwithstanding the Court's obvious intention to construe that waiver narrowly, however, the Congress said nothing to indicate that the provision should be applied retroactively. In these circumstances we cannot infer that the Congress anticipated a broader application of § 114(2) than is required by its terms. 27 1. Thompson v. Sawyer. Brown nonetheless contends that our own precedents require that we treat the question of retroactivity by reference to the presumption laid out in Bradley and not as we treat other aspects of the scope of a waiver of sovereign immunity. In this connection Brown draws our attention to Thompson v. Sawyer, 678 F.2d 257 (D.C.Cir.1982), in which we held that certain statutory amendments making back pay and damages available to employees of the Government Printing Office could be applied retroactively to compensate employees for a period beginning before the effective date of the amendments. Indeed, quoting Bradley, we invoked the basic rule that a court is to apply the law in effect at the time it renders its decision. 678 F.2d at 279. In an opinion by Judge Mikva before he said goodbye to footnotes, the court addressed the issue of sovereign immunity only in the margin, as follows: 28 GPO contends that sovereign immunity insulates it from retrospective liability under both the Equal Pay Act and Title VII. Congress, however, waived sovereign immunity by authorizing suits against the federal government under the FLSA. See United States v. Testan, 424 U.S. 392 [96 S.Ct. 948, 47 L.Ed.2d 114] (1976). The question we face is whether Congress intended the statutory change, and hence the waiver, to have only prospective thrust. 29 Id. at 281 n. 23; see also id. at 289 n. 33. 30 In Thompson we were concerned with a rather narrow class of cases--those in which the conduct for which the Government is liable began before but continued beyond the effective date of the statute. See Stoller v. Marsh, 682 F.2d 971, 974 (D.C.Cir.1982) (citing Thompson). That is no doubt why, although we have often cited Thompson, it has never been to suggest in any way that a waiver of sovereign immunity may be applied retroactively if the Congress was silent upon that question. On the contrary, Judge Mikva later characterized Thompson as a case of the court following known congressional intent and holding that the 1972 amendments ... had simply extended to federal employees a remedy for illegal discrimination, and that Congress had intended that remedy to be applied to the fullest extent. McKenzie v. Sawyer, 684 F.2d 62, 78 (D.C.Cir.1982); cf. Cuneo v. Rumsfeld, 553 F.2d 1360 (D.C.Cir.1977) (provision in FOIA authorizing awards of attorney's fees applied retroactively despite rule of strict construction because legislative history showed that Congress intended that existing body of law governing attorney's fees be used to determine whether award could be made against Government). 31 Moreover, after the Supreme Court had decided Ruckelshaus (about a year after our decision in Thompson ), reaffirming that the rule of strict construction applies to waivers of sovereign immunity from attorney's fees and cautioning courts against enlarging these waivers beyond the explicit statutory language, Nichols, 740 F.2d at 1255-56, we expressly relied upon the rule of strict construction in holding that a statute waiving sovereign immunity from attorney's fees could not be applied retroactively to cover fees incurred before the effective date of the statute because the Congress did not state or imply that it intended that result. See In re Jordan, 745 F.2d at 1576. We reached this holding without any suggestion that it was in tension with Thompson. We see no reason why Thompson should be of any more help to Brown today than it was to Hamilton Jordan in 1984. 32 2. Hill v. United States. Brown also relies upon Hill v. United States, 571 F.2d 1098, 1102 (1978), in which the Ninth Circuit held that § 702 of the Administrative Procedure Act applies retroactively to waive sovereign immunity from declaratory and affirmative relief arising out of conduct that occurred before the effective date of the 1976 amendments to the APA. The court in Hill analyzed the retroactivity of § 702 using the framework of Bradley, without reference to the rule of strict construction; that the provision was a waiver of sovereign immunity was considered only in the course of determining whether it would be a manifest injustice to apply the statute retroactively. Id. 33 We note in this regard that the continued vitality of Hill as the law of the Ninth Circuit is very doubtful. The court adhered to Hill later the same year in Rawlings v. Heckler, 725 F.2d 1192, 1194-95 (9th Cir.1984) (holding attorney's fees incurred before effective date of EAJA recoverable in case pending on effective date, and rejecting Government's attempt to distinguish Bradley on sovereign immunity grounds). In the following year, however, the court limited Rawlings and distinguished it from a case raising the issue that we faced in Nichols v. Pierce--that is, whether a fee petition pending on the effective date of a statute authorizing an award of attorney's fees brings the case within the class of covered cases pending on the effective date. See Tongol, 762 F.2d at 730-32. The Ninth Circuit, following our holding and analysis in Nichols, distinguished Bradley because it did not involve a waiver of sovereign immunity and noted that Nichols more closely reflect[ed] the approach mandated by latest teachings of the Supreme Court, namely the principles of narrow construction. Id. at 732. Then, in a 1987 case involving the retroactive application of a statute that changed the index that determines (but did not necessarily raise) the rate of postjudgment interest payable by the Government, the court acknowledged the rule of strict construction in Tongol but then cited Hill and Rawlings with approval, stating that [t]he principle of sovereign immunity does not require us to resolve all doubtful questions concerning the temporal applicability of a statute in the government's favor when the literal requirements of the statute are otherwise met. Campbell, 809 F.2d at 577. That case, however, was effectively overruled by the Supreme Court, which concluded, in a case against a private defendant in which sovereign immunity was not implicated at all, that the statute could not be applied retroactively to a judgment entered before the effective date of the statute. See Kaiser Aluminum & Chemical Corp. v. Bonjorno, 494 U.S. 827, 110 S.Ct. 1570, 108 L.Ed.2d 842 (1990). 34 Finally, in considering whether to apply the provision at issue in this case to authorize interest on back pay in a case against the Government that was pending upon enactment of the statute, the Ninth Circuit discussed the retroactivity issue in Bradley-inspired terms without considering the rule of strict construction it had recognized in Tongol for cases against the sovereign. See Estate of Reynolds v. Martin, 985 F.2d 470, 472-73 (9th Cir.1993). Ultimately, however, the court concluded instead that the plain language of the 1991 Act indicates that the Congress intended that it be applied retroactively. See id. at 476. Inasmuch as the Supreme Court has since made clear that neither the language nor the legislative history shows an intent that the 1991 Act as a whole be applied retroactively, see Landgraf, --- U.S. at ---- - ----, 114 S.Ct. at 1493-96, it is unclear how the Ninth Circuit would now resolve the question whether § 114(2) in particular is retroactive. If it recalls the distinction it drew in Tongol --its last word on the subject apart from the decisions effectively overruled in Kaiser Aluminum or cast into doubt by Landgraf --then it will reach the same conclusion we do. See also United States v. Matson Nav. Co. (The Louie III), 201 F.2d 610, 616 (9th Cir.1953) (waiver of sovereign immunity creates a new cause of action which has no retroactive effect unless specifically granted). In any event, the present state of the law on this issue in the Ninth Circuit is at best unclear and does not give us pause. 35 3. Other Cases. The remainder of the cases to which Brown refers are simply inapposite. In Hutto v. Finney, 437 U.S. 678, 693-98, 98 S.Ct. 2565, 2574-78, 57 L.Ed.2d 522 (1978), the Supreme Court held that a statute authorizing fee-shifting in civil rights cases applied retroactively against the State of Arkansas, but only after concluding that the statute made fees part of the costs awarded to a prevailing plaintiff, which had never been barred by the sovereign immunity of the States recognized in the Eleventh Amendment. In Natural Resources Defense Council, Inc. v. EPA, 703 F.2d 700 (3d Cir.1983), the Third Circuit did not even mention sovereign immunity in concluding that the statute in question applied retroactively against the United States. And both the Seventh Circuit in Adams v. Brinegar, 521 F.2d 129 (7th Cir.1975), and this court in Womack v. Lynn, 504 F.2d 267 (D.C.Cir.1974), held that a statute authorizing judicial review of a federal employee's administrative claim of employment discrimination applied retroactively because the statute provided merely that the employee would have access to a judicial forum and did not create a new substantive liability in derogation of sovereign immunity. None of these cases supports the argument that we should resolve the question whether the waiver of sovereign immunity in this case may be applied retroactively by consulting the principle of Bradley rather than the rule of strict construction.