Court Opinion

ID: 6980291
Source: CourtListenerOpinion
Date Created: 2022-07-24 02:18:24.083384+00
Date Added: 2024-06-11T16:09:09.933913
License: Public Domain

GILMAN, Circuit Judge,
concurring.
I concur in the result reached by the majority because Tri-State does not appear'to be a “front” or “alter-ego” for National. I write separately, however, because I wish to emphasize that the majority’s opinion should not be interpreted to mean that this court will grant attorneys’ fees under the Equal Access to Justice Act, 5 U.S.C. § 504 (“EAJA”), to any corporate entity that technically meets EAJA’s requirements, regardless of the extent of its affiliation with ineligible corporations.
The purpose of EAJA is to assist “small businesses” and “persons ... for whom costs may be a deterrent to vindicating their rights.” See H.R.Rep. No. 96-1418, at 10,15 (1980) reprinted in 1980 U.S.C.C.A.N. 4984, 4988, 4994. In furtherance of this purpose, EAJA limits the award of fees to entities whose net worth does not exceed $7,000,000 and that have fewer than 500 employees. See 5 U.S.C. § 504(b)(1)(B). Tri-State is such an entity, but its parent corporation, National, is not.
Based upon the record before us, I concur with the majority’s conclusion that Tri-State is not litigating on behalf of National, nor is it a mere front or alter-ego of its parent company. On the other hand, the two companies share the same board of directors, the same safety director, the same office facilities, and they are represented by the same outside counsel. I thus find this to be a very close case.
Although, as the majority notes, the statute is silent as to whether the assets and workforces of parent companies and their subsidiaries should be aggregated for the purpose of determining eligibility, a rule that would prevent aggregation under any circumstances would contravene the purpose of EAJA. In holding that Tri-State is eligible for attorneys’ fees under EAJA, I do not believe that this court is opening the barn door for EAJA-fee claims by shell corporations that do not function as independent entities. Nor do I understand the decision in the present case to preclude courts from engaging in a “real-party-in-interest” analysis where it appears that a subsidiary corporation is litigating on behalf of the parent. Finally, I do not believe that the plain language of the statute, specifically the term “corporation,” compels this court to engage in mechanical, formalistic deference to the corporate form.
Rather, I take the majority decision to mean that Tri-State is not a front or an alter-ego of National, and is thus sufficiently independent to be eligible for attorneys’ fees under EAJA. For this reason, I concur in the majority’s decision.