Felipe Perez v. Ur Jaddou

31 F.4th 267

• Court: Court of Appeals for the Fourth Circuit
• Decided: April 12, 2022
• Docket: 21-1353
• Status: Published

Opinion

PUBLISHED

UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT

No. 21-1353

FELIPE PEREZ PEREZ,

Plaintiff – Appellant,

v.

UR MENDOZA JADDOU, Director, United States Citizenship and Immigration Services,

Defendant – Appellee.

Appeal from the United States District Court for the Western District of North Carolina, at Charlotte. Robert J. Conrad, Jr., District Judge. (3:16-cv-00748-RJC-DSC)

Argued: March 9, 2022 Decided: April 12, 2022

Before WILKINSON, KING, and QUATTLEBAUM, Circuit Judges.

Affirmed by published opinion. Judge Wilkinson wrote the opinion, in which Judge King and Judge Quattlebaum joined.

ARGUED: Geoffrey Forney, WASDEN BANIAS LLC, Charleston, South Carolina, for Appellant. Sheetul S. Wall, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee. ON BRIEF: Brad Banias, WASDEN BANIAS LLC, Charleston, South Carolina, for Appellant. Brian Boynton, Acting Assistant Attorney General, William C. Peachey, Director, Jeffrey S. Robins, Deputy Director, District Court Section, Office of Immigration Litigation, Civil Division, UNITED STATES DEPARTMENT OF JUSTICE, Washington, D.C., for Appellee WILKINSON, Circuit Judge:

After prevailing against the government in en banc proceedings, Felipe Perez Perez

moved for attorney’s fees under the Equal Access to Justice Act. The district court declined

to award fees, holding that the government’s position was substantially justified. Finding

no abuse of discretion in that decision, we affirm.

I.

Perez fled Guatemala at the age of sixteen. He entered the United States in January

2014, and he was apprehended by border patrol agents before eventually being released to

his older brother (a resident of North Carolina). On June 29, 2015, a juvenile court in North

Carolina conducted an ex parte hearing and granted Perez’s brother emergency temporary

custody of Perez. It also scheduled a hearing for July 22, 2015, to make a permanent

custody determination. Yet that hearing did not take place because Perez’s eighteenth

birthday on July 6 divested the juvenile court of jurisdiction. The court accordingly never

entered a permanent custody order.

On or shortly before his eighteenth birthday, Perez filed an application for special

immigrant juvenile (SIJ) status with United States Citizenship and Immigration Services

(USCIS). SIJ status provides certain protections against removal, see 8 U.S.C. § 1255, and

it can lead to lawful permanent residency and citizenship, Perez v. Cissna, 914 F.3d 846,

850 (4th Cir. 2019). To qualify for SIJ status, a minor must be an immigrant whom “a

juvenile court located in the United States” has “placed under the custody of” an individual

appointed by that court “and whose reunification with 1 or both of the immigrant’s parents

is not viable due to abuse, neglect, abandonment, or a similar basis found under State law.”

2 8 U.S.C. § 1101(a)(27)(J)(i). To satisfy this statutory requirement, Perez submitted the June

2015 emergency temporary custody order with his application.

On July 31, 2015, USCIS issued Perez a Notice of Intent to Deny his SIJ application

because the June 2015 order was “expressly temporary in nature and does not make a

finding that reunification with one or both parents is permanently not viable.” Perez v.

Cuccinelli, 949 F.3d 865, 870 (4th Cir. 2020) (en banc) (quoting USCIS Notice). The

Notice offered Perez a chance to submit rebuttal evidence, and Perez subsequently

submitted a nunc pro tunc order from the juvenile court stating that the June 2015 order

“granting temporary custody . . . was as permanent as possible under North Carolina law.”

J.A. 31–32. USCIS nonetheless denied Perez’s application, finding that the nunc pro tunc

order “does not overcome” the fact that the June 2015 order “is expressly temporary in

nature and does not make a finding that reunification with one or both parents is

permanently not viable.” Perez, 949 F.3d at 871 (quoting USCIS decision).

Perez appealed to the Administrative Appeals Office (AAO), which upheld the

denial of Perez’s SIJ application and dismissed his appeal on May 9, 2016. According to

the AAO, the June 2015 order “was not a qualifying juvenile court order” under the statute

“at the time it was issued because there was no finality to the proceedings. Only in the

hearing scheduled for July 22, 2015, could the juvenile court have determined the viability

of [Perez’s] reunification with one or both parents and the resulting custody issues.” J.A.

15. The agency therefore found Perez ineligible for SIJ classification.

In October 2016, Perez filed a complaint in district court seeking review of the

agency’s denial of his SIJ application. Perez alleged violations of the Administrative

3 Procedure Act (APA)—arguing that the agency’s denial was arbitrary and capricious and

in excess of statutory authority because it added an ultra vires permanency requirement to

the SIJ statute—and of the Full Faith and Credit Clause of the Constitution. USCIS moved

for summary judgment on the administrative record, and the district court granted that

motion. The district court found the Full Faith and Credit Act inapplicable. And as to

Perez’s APA claims, the district court held both that the agency did not add an ultra vires

permanency requirement and that it did not “act arbitrarily or capriciously in differentiating

between temporary emergency custody orders and permanent custody orders.” J.A. 98.

Perez appealed, and this panel affirmed the district court’s judgment in a split

decision. The panel majority, per Judge Quattlebaum joined by Judge Wilkinson, found

that USCIS “did not impose an ultra vires requirement for permanent custody orders,” that

USCIS did not act arbitrarily or capriciously “in determining that Perez failed to present a

qualifying predicate order in support of his SIJ petition,” and that the Full Faith and Credit

Act was “inapplicable.” Perez, 914 F.3d at 857. Judge King dissented, reasoning that

USCIS did not act in accordance with law because it imposed a permanency requirement

contrary to the plain meaning of the SIJ statute. Id. at 858, 864.

On rehearing en banc, the court reversed the judgment of the district court and

remanded with instructions to grant Perez’s motion to set aside USCIS’s denial of SIJ

status. See Perez, 949 F.3d at 868. Judge King’s majority opinion held that USCIS acted

contrary to law by imposing a permanency requirement and found that USCIS’s

interpretation “is entitled to no deference, defies the plain statutory language, and

impermissibly intrudes into issues of state domestic relations law.” Id. Judge Quattlebaum

4 dissented, reasoning instead that “the temporary nature of the state order was just one of

several factors upon which the Agency relied” and that a deferential standard of review

was therefore proper. Id. at 882.

Following his victory before the en banc court, Perez sought to recover attorney’s

fees and expenses under the Equal Access to Justice Act (EAJA). The district court denied

Perez’s EAJA application, finding the government’s position “substantially justified.” J.A.

435. It reasoned that the issue was one of first impression, that the government “relied upon

its reasonable understanding of relevant precedent . . . given the information it had available

at the time,” and that the “arguments made by both sides were legally and factually

substantial.” J.A. 434. That determination is now before us.

II.

Under the EAJA, “a court shall award to a prevailing party other than the United

States fees and other expenses . . . incurred by that party in any civil action” brought against

the United States “unless the court finds that the position of the United States was

substantially justified or that special circumstances make an award unjust.” 28 U.S.C.

§ 2412(d)(1)(A). The EAJA is thus a qualified fee-shifting statute rather than a prevailing

party statute. By including the substantial-justification and special-circumstances

exceptions instead of automatically awarding fees to victorious parties, Congress intended

to “penalize unreasonable behavior on the part of the government without impairing the

vigor and flexibility of its litigating position.” Crawford v. Sullivan, 935 F.2d 655, 659 (4th

Cir. 1991).

5 Perez is indisputably a prevailing party in a civil action brought against the United

States. In deciding whether he is entitled to fees and expenses, therefore, we must

determine whether the position of the United States was substantially justified.

“The position of the United States” is singular, so we examine “the totality of

circumstances” rather than engaging in “an issue-by-issue analysis of the government’s

posture throughout each phase of the litigation.” Roanoke River Basin Ass’n v. Hudson,

991 F.2d 132, 139 (4th Cir. 1993). “While the parties’ postures on individual matters may

be more or less justified, the EAJA—like other fee-shifting statutes—favors treating a case

as an inclusive whole, rather than as atomized line-items.” Comm’r, INS v. Jean, 496 U.S.

154, 161–62 (1990). “The government’s position ‘encompass[es] both the agency’s

prelitigation conduct and the Department of Justice’s subsequent litigation position[.]’”

Crawford, 935 F.2d at 656-57 (alterations in original) (quoting Jean, 496 U.S. at 159).

The government need not prevail for its position to be substantially justified, though

it does bear the burden of proving substantial justification. Meyer v. Colvin, 754 F.3d 251,

255 (4th Cir. 2014). A position is substantially justified “if a reasonable person could think

it correct, that is, if it has a reasonable basis in law and fact.” Pierce v. Underwood, 487

U.S. 552, 566 n.2 (1988); see also id. at 565 (defining “substantially justified” as “‘justified

in substance or in the main’—that is, justified to a degree that could satisfy a reasonable

person”). The substantial-justification standard therefore gives the government room to

maneuver so long as it does not go completely off the track. See Hess Mech. Corp v. NLRB,

112 F.3d 146, 149 (4th Cir. 1997).

6 We review denials of EAJA fees for an abuse of discretion. Priestley v. Astrue, 651

F.3d 410, 415 (4th Cir. 2011). That review is deferential for good reason: The Supreme

Court has instructed that “[a] request for attorney’s fees should not result in a second major

litigation.” Hensley v. Eckerhart, 461 U.S. 424, 437 (1983). So only if the district court

applied “mistaken legal principles” or made “clearly erroneous factual findings” will we

find an abuse of discretion. Priestley, 651 F.3d at 415.

We see no such abuse here. The district court rightly noted that Perez’s case posed

a novel question; that it was no layup, as illustrated by the division among the good judges

who considered it; and that there were reasonable arguments on both sides. We thus affirm

the district court’s denial of attorney’s fees.

A.

At the outset, it matters that Perez’s case presented a novel question. As we have

recognized, “litigating cases of first impression is generally justifiable.” Cody v.

Caterisano, 631 F.3d 136, 142 (4th Cir. 2011). And “first impression” can well mean first

impression in this circuit. See Hyatt v. Shalala, 6 F.3d 250, 256 (4th Cir. 1993) (“The

Secretary was justified in litigating the issue on appeal because it was still one of first

impression in this circuit.”). While Perez argues that our prior decision in Ojo v. Lynch,

813 F.3d 533 (4th Cir. 2016), set out the appropriate analytical framework for his case, he

does not dispute that the specific issue here was one of first impression.

In addition, it is surely relevant that the government’s position was found to be

persuasive by the district court, by a majority of this panel, and by six judges sitting en

banc. See Pierce, 487 U.S. at 568 (noting relevance of “the stage in the proceedings at

7 which the merits were decided”). This is strong evidence that the government’s position

was substantially justified. But just as the government’s ultimate defeat before the en banc

court does not render its position substantially unjustified, neither do the government’s

intermediate victories before the district court and this panel automatically mean its

position was substantially justified. See United States v. Paisley, 957 F.2d 1161, 1167 (4th

Cir. 1992). “Conceivably, the Government could take a position that is not substantially

justified, yet win; even more likely, it could take a position that is substantially justified,

yet lose.” Pierce, 487 U.S. at 569. Yet it is certainly more likely in these circumstances—

where no fewer than seven federal judges agreed with the government—that the position

of the United States was substantially justified.

B.

Because the objective indicia may not always be determinative, however, we turn

to an assessment of the merits of the government’s position. See Pierce, 487 U.S. at 569.

The rationales of the opinions themselves “are the most powerful available indicators of

the strength, hence reasonableness, of the ultimately rejected position.” Paisley, 957 F.2d

at 1167. We must, then, examine this court’s en banc opinions. In so doing, we are not

attempting to relitigate the merits of Perez’s underlying case. Let there be no doubt: the

law of our circuit is that USCIS’s actions in interpreting the SIJ statute to require a

permanent custody order were not “in accordance with law.” Perez, 949 F.3d at 881.

Start with Judge King’s thoughtful en banc majority opinion. That opinion held that

USCIS improperly required “a finding of the permanent non-viability of an SIJ applicant’s

reunification with one or both of his parents and a permanent custody order.” Id. at 870.

8 And it found the AAO’s decision likewise subscribed to the view that permanency was

required. Id. at 871.

The en banc majority then engaged in careful statutory interpretation, concluding

that the SIJ statute was “clear and unambiguous that neither a finding of the permanent

non-viability of reunification nor a permanent custody order is required.” Id. at 873. It first

noted that the SIJ statute requires a finding that “reunification with 1 or both . . . parents is

not viable,” which means “reunification must be presently non-viable.” Id. at 874 (quoting

8 U.S.C. § 1101(a)(27)(J)(i) (emphasis in opinion)). Next, it interpreted the phrase “placed

under the custody of” in the SIJ statute to find that the ordinary meaning of “custody”—a

word which “contains no temporal requirements”—controlled. Id. at 875. Because the

statutory language was clear and unambiguous, the majority held that the agency

interpretation was not entitled to deference. Id. at 872–73.

In addition, the majority found that USCIS’s interpretation “impermissibly

intrude[d] into issues of state domestic relations law” by “demand[ing] rulings . . . that state

courts may be unwilling or unable to render.” Id. at 876. And it emphasized that even if the

statutory language were ambiguous, USCIS’s permanency requirement was not entitled to

deference either under Chevron (because the requirement was not derived through notice-

and-comment rulemaking or a formal adjudication) or under Skidmore (because the agency

did not demonstrate the “carefulness, expertise, or consistency that would imbue its

interpretation with the power to persuade”). Id. at 877–79. In the end, the majority

concluded that “USCIS denied [Perez] SIJ status solely because he lacked the type of

custody order—a permanent one—that the Agency has interpreted . . . the SIJ provision to

9 require.” Id. at 881. Because that interpretation was “not in accordance with law,” USCIS

had to “take another look at” Perez’s SIJ application. Id.

Next consider the en banc dissent. The dissent disputed that USCIS “imposed a

blanket requirement that SIJ predicate custody orders must be permanent,” instead

reasoning that “the temporary nature of the state order was just one of several factors upon

which [USCIS] relied in concluding that the order did not satisfy the SIJ requirements

under the INA.” Id. at 882 (Quattlebaum, J., dissenting). The dissent thus read the USCIS

and AAO decisions to “focus more on the terms of the order that reflect its ex parte and

emergency nature than whether it was permanent or temporary.” Id. at 886.

The dissent emphasized that the ultra vires standard of review was narrow, asking

whether the agency “is not doing the business which the sovereign has empowered [it] to

do or [it] is doing it in a way which the sovereign has forbidden.” Id. at 885 (quoting Larson

v. Domestic & Foreign Commerce Corp., 337 U.S. 682, 689 (1949)). Because it read the

agency decisions as determining whether the order met the statutory requirements rather

than as imposing a blanket rule, it thought that USCIS was merely fulfilling its obligation

to review state-court orders for their sufficiency under the SIJ statute, and it found no ultra

vires problem with USCIS’s actions. See id. at 886–87.

Perez’s alternative “arbitrary and capricious” argument fared no better in the

dissent’s eyes. Again emphasizing the narrow standard of review, the dissent found a

“clear, rational path for [USCIS’s] decision.” Id. at 887. The dissent thought that USCIS

had the responsibility to make the determination that it did, that it appropriately explained

that the emergency and ex parte character of the North Carolina order failed to satisfy the

10 SIJ requirements, and that its determination, rather than impinging upon state domestic-

relations law, was consistent with that law. Id. at 887–89. And it found no basis for

departing from a deferential standard of review where the agency attempted to give the

emergency order the same limited effect that the North Carolina courts would give it. Id.

at 889. Thus, it would have affirmed the agency’s decision. Id.

C.

As the en banc opinions demonstrate, this was a tough case. Though the

government’s position ultimately lost, it almost beggars belief to say its position was not

substantially justified. In arguing otherwise, Perez attempts to flyspeck particular

arguments by the government, highlighting what he calls obfuscation, indefensible logic,

and wholesale changes of position. But “[a]t every stage, in every brief,” Meyer, 754 F.3d

at 257, the government consistently argued that Perez’s order did not meet the eligibility

requirements of the SIJ statute; that USCIS did not impose an ultra vires permanency

requirement; and that the agency actions were not arbitrary and capricious. See J.A. 29–45

(district court brief); J.A. 132–78 (panel brief); J.A. 273–320 (en banc brief). These

arguments, though ultimately rejected, were not unreasonable. Both sides in good faith

made the best case they could.

While some of the government’s arguments were less persuasive than others, this is

true of virtually every case we consider, and so we reject Perez’s invitation to inspect every

jot and tittle of the government’s briefing. After all, we must review the “totality of

circumstances.” Roanoke River Basin Ass’n, 991 F.2d at 139. Those circumstances here

show a difficult case posing a novel question with reasonable arguments on both sides.

11 Though this panel was previously divided on the proper resolution of Perez’s case, we are

united in holding that the district court did not abuse its discretion in finding the

government’s position in that case substantially justified. Each side fought valiantly in prior

proceedings, and it is now well past time to turn swords into plowshares.

III.

Both Perez and the government put forth strong arguments. And this is exactly as it

should be. We do not want to engender an environment in which the government is deterred

from presenting full and robust arguments for fear that it may be liable for an award of

attorney’s fees. If the government goes off the rails, that’s one thing. But what we rightly

term our adversary system is designed precisely for the full-throttle clash that transpired

here. Indeed, the EAJA “was never intended to chill the government’s right to litigate or to

subject the public fisc to added risk of loss when the government chooses to litigate

reasonably substantiated positions, whether or not the position later turns out to be wrong.”

Roanoke River Basin Ass’n, 991 F.2d at 139. This case was uncertain at the start and close

at the outcome. Though it is tempting to succumb to hindsight’s bias by equating a losing

position with an unreasonable one, we must resist that temptation here. The district court

held that the government’s position was substantially justified, and we find no abuse of

discretion in that decision.

AFFIRMED