Lauritzen v. Lehman

736 F.2d 550

Opinions

SNEED, Circuit Judge:

This appeal is from an order awarding attorney’s fees pursuant to the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412. We reverse and remand this case for further proceedings consistent with our decision. ■

I.

FACTS AND PROCEEDINGS BELOW

Plaintiff Carolyn R. Lauritzen alleged in this action that she was threatened with discharge from the Navy and that her rank and pay were reduced as result of her statements to a Navy psychiatrist that she might have homosexual tendencies. Lauritzen sought damages and prospective relief on the grounds that the Navy’s actions violated her constitutional rights. The district court issued a preliminary injunction and ordered Lauritzen to seek review of her discharge order from the Board for Correction of Naval Records (BCNR). The BCNR ordered that Lauritzen’s file be purged of material pertaining to the intended discharge, and that her rank and pay be retroactively restored. Because the BCNR granted Lauritzen substantially all of the relief she had sought in the court action, the district court dismissed the case as moot.

Lauritzen requested an award of attorney’s fees pursuant to sections 2412(b) and 2412(d)(1)(A) of EAJA. Section 2412(b) gives the court discretion to award fees to a prevailing party and provides that the United States “shall be liable ... to the same extent that any other party would be liable under the common law or under the terms of any statute which specifically provides for such an award.” ¹ In contrast to the discretionary awards under section 2412(b), section 2412(d)(1)(A) provides that attorney’s fees shall be awarded to a party prevailing in a civil action against the government “unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.” ²

The district court refused to award fees under section 2412(d)(1)(A) because it found that the government’s position in the litigation was substantially justified. Lauritzen v. Secretary of the Navy, 546 F.Supp. 1221, 1226 (C.D.Cal.1982). Section 2412(b), the district court concluded, authorized a fee award because Lauritzen’s claim was “virtually identical to an action under [42 U.S.C.] § 1983, the only difference being that this action involves a federal official acting under the color of federal law.” 546 F.Supp. at 1227.³ The district court reasoned that because “a state official would be liable for fees under [42 U.S.C.] § 1988 in a § 1983 action alleging constitutional violations of the type asserted here, the United States should be held liable, pursuant to § 2412(b), for attorney’s fees equivalent to those available under § 1988.” 546 F.Supp. at 1227. The district court awarded fees totalling $20,267.50. The government filed a timely notice of appeal and Lauritzen filed a timely cross-appeal. We reject both the district court’s reasoning and its conclusion.

II.

DISCUSSION

Because this appeal raises issues concerning the proper interpretation of EAJA in awarding fees, our review is de novo. See Southern Oregon Citizens Against Toxic Sprays, Inc. v. Clark, 720 F.2d 1475, 1481 (9th Cir.1983).

A. The Fee Award Pursuant to Section U12(h)

The government argues that section 2412(b) does not authorize fee awards in cases that are “analogous” to section 1983 suits. To clarify the contentions of the parties, we set forth the key sentence of section 1988 on which Lauritzen relies:

“In any action or proceeding to enforce a provision of sections 1981, 1982, 1983, 1985, and 1986 of this title, title IX of Public Law 92-318, or title VI of the Civil Rights Act of 1964, the court, in its discretion, may allow the prevailing party, other than the United States, a reasonable attorney’s fee as part of the costs.”

Lauritzen interprets section 2412(b) as if section 1988 contained the following language after the phrase “and 1986 of this title”:

any rights against the United States, its officials, or employees analogous to those protected by the foregoing sections,”

Insisting that section 1988 must be read as it is written, i.e., without this additional language, the government maintains that it may be liable for fees under that section only if it has violated a provision actually named therein. For example, if the government violates Title VI or Title IX, sections 2412(b) and 1988 would authorize a fee award against the United States. We agree with the government.

Our starting point is the language of section 2412(b). See, e.g., Reiter v. Sonotone Corp., 442 U.S. 330, 337, 99 S.Ct. 2326, 2330, 60 L.Ed.2d 931 (1979). It authorizes fee awards under the common law exceptions to the American rule that a party pays its own fees or “under the terms of any statute which specifically provides for such an award.” 28 U.S.C. § 2412(b) (emphasis added). The most nearly applicable such statute is section 1988. Lauritzen, as the district court acknowledged, 546 F.Supp. at 1224, could not obtain a fee award under the express language of section 1988, because she did not allege a violation of any of the specific provisions enumerated under that act. Other courts have held that in these circumstances fees should not be awarded under section 2412(b). E.g., Saxner v. Benson, 727 F.2d 669,. 673 (7th Cir.1984); Unification Church v. INS, 574 F.Supp. 93, 96 (D.D.C.1983); United States v. Miscellaneous Pornographic Magazines, 541 F.Supp. 122, 127-29 (N.D.Ill.1981).

The district court, however, relied on the legislative history and policy of EAJA to give section 2412(b) a broader meaning that, in effect, expands the coverage of section 1988. The Eighth Circuit recently employed a similar approach to reach the same conclusions as did the district court here. See Premachandra v. Mitts, 727 F.2d 717, 727 (8th Cir.1984). We believe, however, that neither the legislative history nor the policy of EAJA compels a departure from the actual language of sections 2412(b) and 1988.

The primary purpose of Congress in enacting section 2412(b) was to apply the common law exceptions to the American rule to the federal government. See H.R. Rep. No. 1434, 96th Cong., 2d Sess. 25, reprinted in 1980 U.S.Code Cong. & Ad. News 4953, 5003, 5014. The House Report notes two cases that refused to apply common law exceptions to the government—Pealo v. Farmers Home Administration, 562 F.2d 744 (D.C.Cir.1977) (rejecting “common benefit” exception), and Rhode Island Committee on Energy v. General Services Administration, 561 F.2d 397 (1st Cir.1977) (refusing to apply “bad faith” exception). Immediately following, the Report states “[t]his subsection reflects the belief that at a minimum, the United States should be held to the same standard in litigating as other parties and that no justification exists for excepting the United States from fee awards in these limited situations.” H.R.Rep. No. 1434, supra, at 17, 1980 U.S.Code Cong. & Ad.News at 4996.

That section 2412(b) might reach beyond these limits is suggested by the House Report, which observes that the section also makes the government “liable under the same standards which govern awards against other parties under Federal statutory exceptions, unless the statute expressly provides otherwise. This subsection clarifies the liability of the United States under such statutes as [section 1988], as well.” Id. These comments, we believe, indicate that section 2412(b) authorizes fee awards against the United States under the terms of statutes allowing fees against “any party” or “any person.”⁴ This is the approach adopted in Natural Resources Defense Council v. EPA, 484 F.2d 1331, 1335-36 & n. 5 (1st Cir.1973) (allowing fee award against government under § 304(a) of Clean Air Act), a case which House reports cite approvingly for the proposition that the history of section 2412 “reflects a strong movement by Congress toward placing the Federal Government and civil litigants on a completely equal footing.” H.R.Rep. No. 1418, 96th Cong., 2d Sess. 9, reprinted in 1980 U.S.Code Cong. & Ad. News 4984, 4987; H.R.Rep. No. 1434, supra, at 25, 1980 U.S.Cong. Code & Ad. News at 5014. We follow this approach here.

The district court, however, found that EAJA reaches further and authorizes fee awards in suits analogous to those brought against state officials under section 1983. In doing so it relied on the following circumstances. Senate Bill 265, as originally proposed in 1979, provided in section 2412(b) that the United States should be liable to the same extent as a “private party” would be liable. See Award of Attorneys’ Fees Against the Federal Government: Hearings on S.265 Befare the Subcomm. on Courts, Civil Liberties, and the Administration of Justice of the House Judiciary Comm., 96th Cong., 2d Sess. at 3, 9 (1980) [hereinafter cited as “Hearings on S.265”]. After hearing testimony on S.265, a House subcommittee amended the proposed language of section 2412(b) so that the final version made the United States liable to the same extent as “any other party,” rather than “a private party,” would be liable. See H.R.Rep. No. 1418, supra, at 4.

Nothing in the legislative reports explains the reason for this change. The district • court inferred that it was in response to testimony of Mr. Armand Derfner, who appeared on behalf of the Lawyers Committee for Civil Rights Under Law and the American Civil Liberties Union. Mr. Derfner told the subcommittee:

Mr. Kastenmeier, if I could just direct myself to one portion of this bill?

There is an area in which a slight drafting modification could carry out what I believe might be the intention of the committee; and that is to put the United States completely on a par as far as the enforcement of important constitutional and statutory rights.

In the Civil Rights Act of 1976 you provided that when someone, whether it be an individual or business, or whatever, sues a State or local government under 42 United States Code, section 1983, to vindicate a constitutional or Federal statutory right, that fees would be available under the Newman v. Peggy [Piggie] [sic] Park standard. These bills say that the United States should pay fees — in the amendment to 28 United States Code 2412 — in those circumstances where the court may award such fees in suits involving private parties.

That doesn’t say State or local government, but if the language were amended to read, “in those circumstances where the court may award such fees in suits involving other litigants”; it would achieve that purpose. And I think it would go even further toward putting the United States on a par with other governmental bodies.

Hearings on S.265 at 100. In effect, the district court relied on this testimony to conclude that Congress substituted the phrase “any party” for the phrase “any private party” in order to place upon section 1988 the gloss articulated above which, in turn, gives section 2412(b) the reach ascribed to it. That the gloss, suitably rephrased, might bypass section 1988 and fasten itself directly upon section 2412(b), is of no consequence. The issue remains the same. Is the gloss justified by the legislative history? We think not.

We are hesitant to give Mr. Derfner’s testimony dispositive weight.⁵ The farther we wander from the statutory language to pick up bits and scraps of legislative history to aid interpretation, the more likely will our interpretations be capricious and unpredictable. Caution is especially appropriate here, because we are construing a waiver of sovereign immunity and nothing in the legislative reports indicates that Congress — as opposed to Mr. Derfner — endorsed the interpretation urged upon us by Lauritzen. In construing a provision allowing fee awards against the government, we must take care not to enlarge the waiver of immunity beyond what a fair reading of the language of the statute requires. Ruckelshaus v. Sierra Club, — U.S. —, 103 S.Ct. 3274, 3277, 77 L.Ed.2d 938 (1983).⁶

Had Congress been responsive to Mr. Derfner and the argument Lauritzen makes here, it could have eschewed amending section 1988 and instead amended section 2412(b) to make fees allowable “in those circumstances where the court may award such fees in analogous suits involving other litigants.” Congress did not adopt this language; instead it allowed fees against the government “to the same extent that any other party would be liable ... under the terms of any statute which specifically provides for such an award.” Nor did Congress amend section 1988. Lauritzen would have us ignore the terms of both sections 1988 and 2412(b).⁷ Even if we assume that Congress amended section 2412(b) in response to the comments of Mr. Derfner, the amendment did not accomplish what Lauritzen maintains was his objective. Instead, the amendment only assured that sovereign immunity would pose no bar to a fee award against the United States where the government is found liable under a substantive provision that would authorize a fee award against a state.

The district court also relied upon the policy of EAJA in construing section 2412(b). Focusing on the purpose of legislation is surely a legitimate element of statutory interpretation. Nonetheless, this exercise often proves to be difficult because legislatures rarely act with a single purpose. Where statutes reflect, as they frequently do, both explicit and implicit compromises among competing considerations, our use of policy must be wary and cautious. To do otherwise risks upsetting the balance struck by Congress among competing goals. Nor should courts accept a sly invitation to achieve an end for which Congress could not muster the votes. There may be exceptions to this principle, but this case does not present one.

The relevance of these observations is demonstrated by considering section 2412(b) in the context of the other provisions of EAJA. Cf. Chemehuevi Tribe of Indians v. Federal Power Commission, 420 U.S. 395, 403, 95 S.Ct. 1066, 1072, 43 L.Ed.2d 279 (1975) (§ 4(e) of Federal Power Act must be interpreted in context of other provisions of the Act). EAJA was designed to encourage individuals and small businesses to contest government actions by authorizing fee awards to a prevailing party. E.g., H.R.Rep. No. 1418, supra, at 12, 1980 U.S.Code Cong. & Ad.News at 4991. Comments in the legislative history that address the purpose of EAJA focus primarily on section 2412(d). Congress acknowledged that this provision would be the “general statutory exception for awards against the United States.” See id. at 13, 18, 1980 U.S.Code Cong. & Ad.News at 4992, 4997. Congress also specifically noted that this subsection would apply to “constitutional torts.” Id. at 18, 1980 U.S. Code Cong. & Ad.News at 4997. Cf. Foster v. Tourtellotte, 704 F.2d 1109, 1111 & n. 2 (9th Cir.1983) (applying § 2412(d)(1)(A) in case alleging unconstitutional invasion of privacy).

Section 2412(d) demonstrates that in enacting EAJA, Congress recognized other concerns in addition to seeking to encourage challenges to government actions. Section 2412(d), for example, does not authorize fees without regard to the merits of the government’s position. Indeed, Congress considered and rejected a proposal for automatic fee shifting to a prevailing party, and instead provided that fees would not be recoverable if the government’s position was substantially justified. H.R. No. 1418, supra, at 13-14, 1980 U.S.Code Cong. & Ad.News at 4992. Section 2412(d) also .limits the extent of the government’s liability by restricting those parties eligible to recover fees and the hourly rates that may be used to determine awards. See 28 U.S.C. § 2412(d)(2). Finally, section 2412(d) represents a “limited experiment” because a sunset provision repeals that section on October 1, 1984. H.R. No. 1418, supra, at 13, 1980 U.S.Code Cong. & Ad. News at 4992. Congress contemplated that the cost and impact of the legislation would then be reviewed. Id.

This adjustment of conflicting ends persuades us that the district court’s interpretation of section 2412(b) cannot be supported by reference to the broad purpose or underlying policy of EAJA. Congress thought that purpose would be realized through section 2412(d), and tailored that provision to avoid discouraging legitimate government action or exposing the government to unbounded liability for attorney’s fees.

The balance struck by Congress would be upset if section 2412(b) were interpreted to allow fee awards under section 1988 in cases analogous to section 1983 suits. A prevailing plaintiff in a section 1983 action is entitled to a fee award unless special circumstances render such an award unjust. E.g., Sethy v. Alameda County Water District, 602 F.2d 894, 897 (9th Cir.1979), cert. denied, 444 U.S. 1046,100 S.Ct. 734, 62 L.Ed.2d 731 (1980). Nearly every case alleging a constitutional or statutory violation by the federal government could be characterized as analogous to an imaginary section 1983 action.⁸ This observation applies to cases even in which it is clear that section 2412(d) is intended to be applicable. For example, a suit seeking reinstatement by a federal employee allegedly discharged because of protected First Amendment activities could be characterized as analogous to a section 1983 suit by a state employee against a state agency or official. If the state employee successfully obtained prospective relief, section 1988 would allow a fee award against the state. See Maher v. Gagne, 448 U.S. 122, 130-33, 100 S.Ct. 2570, 2575-77, 65 L.Ed.2d 653 (1980). According to Lauritzen’s reasoning, it follows that the prevailing federal employee could recover fees under section 2412(b) without the restraints of section 2412(d).⁹ Congress, however, clearly intended that the standard under section 2412(d) would “cover both prevailing plaintiffs and prevailing defendants in general litigation against the Government.” H.R. Rep. No. 1418, supra, at 10, 1980 U.S.Code Cong. & Ad.News at 4989.

Reasoning by analogy, moreover, resembles attempting to follow signs that point in opposite directions. Absent a state’s consent to suit, the Eleventh Amendment prevents a discharged state employee from bringing a section 1983 action for damages against the state in federal court. See Quern v. Jordan, 440 U.S. 332, 99 S.Ct. 1139, 59 L.Ed.2d 358 (1979). Because section 1983 does not authorize actions for damages against a state, section 1988 does not allow fee awards against a state in such cases. Cf. Department of Education, State of Hawaii v. Katherine D., 727 F.2d 809, 819-20 (9th Cir.1983) (fees not available under § 1988 where alternative remedial scheme precludes § 1983 action). Inasmuch as Lauritzen seeks damages, her claims could be said to be analogous to damage claims asserted against a state barred by the Eleventh Amendment, and therefore fees are not allowable under section 1988. Our point is that the analogy Lauritzen employs to justify fees can be countered by one that does not.¹⁰ Rather than meander down a path whose guideposts are contradictory, we hold that where the government has violated a particular substantive statute, and attorney’s fees may be awarded against any other party for violation of that statute, the government is also liable for fees. We reverse the award under section 2412(b).¹¹

B. The Denial of a Fee Award Pursuant to Section 2412(d)(1)(A)

Lauritzen also requested an award of fees under section 2412(d)(1)(A). The district court denied this request because it found that the government’s position in the litigation was substantially justified. 546 F.Supp. at 1226. It was erroneous to deny a fee award solely on this basis. We have recently held that in determining whether the government’s position is substantially justified, the district court must evaluate the “totality of the circumstances prelitigation and during trial.” Rawlings v. Heckler, 725 F.2d 1192, 1196 (9th Cir.1984). Accordingly, we reverse the district court’s denial of fees under section 2412(d) and remand this case for reconsideration of this issue in light of Rawlings.12 On remand, the district court shall determine if in the totality of the circumstances, the government’s position had a reasonable basis both jn iaw and fact. See Wolverton v. Heckler, 726 F.2d 580, 583 (9th Cir.1984).

C. A Fee Award Based on the Government’s Bad Faith

Lauritzen also sought fees under section 2412(b) based on the “bad faith” exception to the common law rule barring fee awards. The district court denied this request on the grounds that the government’s litigation conduct did not demonstrate bad faith. 546 F.Supp. at 1227 n. 9. Because recovery under the bad faith exception may be based on the actions that led to a lawsuit as well as the conduct during litigation, McQuiston v. Marsh, 707 F.2d 1082, 1086 (9th Cir.1983), the district court on remand should reconsider this issue to determine if the Navy’s prelitigation conduct justifies a fee award.¹³

Lauritzen’s petition for attorney’s fees and costs on appeal is denied. The government’s appeal to this court was reasonable. The judgment is reversed and remanded for further proceedings consistent with our decision. .

REVERSED and REMANDED.

1 . 28 U.S.C. § 2412(b) provides:

Unless expressly prohibited by statute, a court may award reasonable fees and expenses of attorneys, in addition to the costs which may be awarded pursuant to [§ 2412(a) ], to the prevailing party in any civil action brought by or against the United States or any agency and any official of the United States acting in his or her official capacity in any court having jurisdiction of such action. The United States shall be liable for such fees and expenses to the same extent that any other party would be liable under the common law or under the terms of any statute which specifically provides for such an award.

2 . 28 U.S.C. § 2412(d)(1)(A) provides:

Except as otherwise specifically provided by statute, a court shall award to a prevailing party other than the United States fees and other expenses in addition to any costs awarded pursuant to [§ 2412(a) ], incurred by that party in any civil action (other than cases sounding in tort) brought by or against the United States in any court having jurisdiction of that action, unless the court finds that the position of the United States was substantially justified or that special circumstances make an award unjust.

3 . 42 U.S.C. § 1983 provides in relevant part:

Every person who, under color of ... any State [law] ... subjects ... any citizen of the United States ... to the deprivation of any rights, privileges, or immunities secured by the Constitution and laws, shall be liable to the party injured in an action at law, suit in equity, or other proper proceeding for redress.

4 . Lauritzen argues that § 2412(b) was intended to reverse the results reached in NAACP v. Civiletti, 609 F.2d 514 (D.C.Cir.1979), cert. denied, 447 U.S. 922, 100 S.Ct. 3012, 65 L.Ed.2d 1114 (1980); and Shannon v. HUD, 577 F.2d 854 (3d Cir.), cert. denied, 439 U.S. 1002, 99 S.Ct. 611, 58 L.Ed.2d 677 (1978). Even if the House Reports are thought to refer to these decisions, see United States v. Miscellaneous Pornographic Magazines, 541 F.Supp. 122, 128 n. 4 (N.D.Ill.1982), it does not follow that Congress intended to allow fees under § 2412(b) in actions “analogous” to § 1983 suits. In both Civiletti and Shannon, the federal government was accused of violating specific provisions enumerated in § 1988. To the extent EAJA clarifies the government’s liability under § 1988, we construe § 2412(b) as reversing Civiletti and Shannon and allowing a fee award against the government if it violates one of the provisions named in § 1988.

5 . Justice Jackson’s comments concerning the use of legislative history are apposite:

When we decide from legislative history, including statements of witnesses at hearings, what Congress probably had in mind, we must put ourselves in the place of a majority of Congressmen and act according to the impression we think this history should have made on them. Never having been a Congressman, I am handicapped in that weird endeavor. That process seems to me not interpretation of a statute but creation of a statute.

United States v. Public Utilities Comm'n, 345 U.S. 295, 319, 73 S.Ct. 706, 719, 97 L.Ed. 1020 (1953) (Jackson, J., concurring). Cf. J. Hurst, Dealing with Statutes 43 (1982) ("Legislative hearings may produce detailed comments on pending bills, but typically these come from partisans of one interest or another and must be discounted accordingly.”).

6 . Ruckelshaus v. Sierra Club held that a party that achieves no success on the merits cannot recover attorney’s fees against the government under § 307(f) of the Clean Air Act. Although the relevant legislative history indicated that Congress did not intend to limit fee awards to "prevailing parties,” see 103 S.Ct. at 3278-79; id. at 3286-88 (Stevens, J., dissenting), the Court refused to interpret § 307(f) to allow fee awards to unsuccessful parties absent "a clear showing that this result was intended.” 103 S.Ct. at 3277.

We similarly believe that had Congress intended in EAJA to allow fee awards against the government in cases "analogous” to § 1983 actions, it would have said so in plain language. Cf. Premachandra, 727 F.2d at 727 (acknowledging that Congress could have simply amended § 1988 to allow fees against the United States).

7 . In Premachandra, the Eighth Circuit stated that § 2412(b) makes the United States liable for fees under the same common law standards applicable to any other party. We accept this proposition. See Foster v. Tourtellotte, 704 F.2d 1109, 1111 (9th Cir.1983). The Eighth Circuit further observed that § 2412(b) indicates that “similar conduct” warrants similar fee shifting treatment whether fees are sought under a common law exception or a statutory provision. The court concluded that the United States should be liable for fees in suits involving constitutional violations by federal officials because a state would be liable under § 1988 if state officials committed a “similar” violation. 727 F.2d at 726-27.

We cannot accept the logic of this argument. The premise that § 2412(b) imposes the same standards for assessing fees against the United States as against any other party does not support the conclusion reached in Premachandra. Instead it indicates that fees may be assessed “under the terms of any statute,” such as § 1988, against the United States to the same extent as any other party. Our conclusion does not imply that the United States may be liable under § 1988 only if some other party in the particular case is also liable for fees. Instead, the crucial factor is whether the United States or its officers acting in their official capacity have violated one of the substantive provisions enumerated in § 1988. They did not in this case.

8 . 42 U.S.C. § 1983 provides a cause of action for violations of a federal statute under color of state law. Maine v. Thiboutot, 448 U.S. 1, 4, 100 S.Ct. 2502, 2504, 65 L.Ed.2d 555 (1980). In Premachandra, the Eighth Circuit argued that its interpretation of § 2412(b) would not "swallow up” § 2412(d), because in that circuit § 1983 actions may only be brought for statutory violations that implicate fundamental human rights. 727 F.2d at 730; see First National Bank of Omaha v. Marquette National Bank, 636 F.2d 195, 198 (8th Cir.1980), cert. denied, 450 U.S. 1042, 101 S.Ct. 1761, 68 L.Ed.2d 240 (1981). No such limitation exists in the Ninth Circuit, although we have recently held that a § 1983 action for statutory violations exists only if Congress intended the statute to create rights for the special benefit of the class to which plaintiffs belong. See White Mountain Apache Tribe v. Williams, No. 81-5348 (9th Cir. Feb. 7, 1984); Boatowners and Tenants Ass’n v. Port of Seattle, 716 F.2d 669, 672-73 (9th Cir.1983).

9 . Lauritzen maintains that the Supreme Court’s order vacating and remanding East Baton Rouge Parish School Board v. Knights of the K.K.K., 454 U.S. 1075, 102 S.Ct. 626, 70 L.Ed.2d 609 (1981), for reconsideration in light of EAJA supports her interpretation of § 2412(b). However, the Court’s order and the Fifth Circuit's subsequent opinion do not suggest that the government is liable under § 2412(b) in cases analogous to § 1983 suits. In East Baton Rouge, the KKK brought a § 1983 action against a local school board and HEW. The ■ Fifth Circuit originally denied a request for attorney’s fees against the government under § 1988 on the ground that the statute did not possess the "clear or express” language necessary to waive federal sovereign immunity. 643 F.2d 1034, 1037-38 (5th Cir.1981). The court did, however, find that fees could be awarded under § 1988 against the school board. Id. at 1041. After the Supreme Court’s remand, the Fifth Circuit did not even acknowledge the possibility that the government could be liable under § 2412(b) because this was a § 1983 action. With respect to § 2412(b), the court observed that ”[u]nder this provision, the federal government is now subject to the 'bad faith’ and 'common benefit/common fund’ exceptions to the traditional 'American Rule’ that litigants bear their own costs.” 679 F.2d 64, 67 (5th Cir.1982). The court then discussed the requirements for an award under § 2412(d) and concluded that it did not have adequate facts to determine if the KKK met those requirements. Id. at 68. Accordingly, the court remanded the case to the district court to determine if the KKK qualified for an award under either § 2412(b) or (d). Id. at 69.

10 . The district court’s decision does not explain how one identifies the appropriate "analogous” suit for determining if fees may be awarded against the government. This problem cannot be convincingly resolved by arguing that fees may be awarded so long as in some "analogous” suit, fees could be awarded against a hypothetical defendant. The case before us illustrates the problematic aspects of the district court’s approach.

Lauritzen asserts that because state officials would be liable for fees under § 1988 if they were sued under § 1983, the government should be liable for fees under EAJA in a suit against federal officials under Bivens v. Six Unknown Named Agents, 403 U.S. 388, 91 S.Ct. 1999, 29 L.Ed.2d 619 (1971). This argument is flawed both in its application to this case and its general form. Because Lauritzen is a member of the armed forces, she cannot recover damages against her commanding officers under Bivens. See Chappell v. Wallace, 462 U.S. 296, 103 S.Ct. 2362, 76 L.Ed.2d 586 (1983). Lauritzen cannot draw an analogy between a § 1983 action and a non-existent Bivens action against her superiors. More generally, EAJA only allows fees against the government in cases involving the government or its officials acting in their official capacity. Because Bivens actions are against governmental employees in their individual capacities, Holloman v. Watt, 708 F.2d 1399, 1402 (9th Cir.1983), EAJA does not authorize fee awards in such suits. Cf. Saxner v. Benson, 727 F.2d 669, 673 (7th Cir. Feb. 13, 1984) (EAJA does not authorize fee awards where defendant officials are sued in individual capacity).

Lauritzen’s most persuasive argument is that her suit is analogous to a § 1983 action seeking prospective relief, and because § 1988 would authorize a fee award against a state, EAJA authorizes an award against the federal government. To sustain this analogy, however, one must ignore the features of this case that determine the government’s substantive liability. Lauritzen's membership in the United States military is crucial in identifying the remedies available to her. See Feres v. United States, 340 U.S. 135, 146, 71 S.Ct. 153, 159, 95 L.Ed. 152 (1950) (United States not liable under FTCA for injury to military personnel related to service).

Of course, no state or other party is in a position precisely analogous to that of the federal government with regard to the armed services. Cf. Miscellaneous Pornographic Magazines, 541 F.Supp. at 129 n. 7 (noting difficulties of drawing analogies where challenged action is exclusively committed to federal government). But Lauritzen would have us ignore this point, and allow fees so long as we can imagine an aggrieved state employee who would be entitled to a fee award under § 1988. We do not believe that Congress intended § 2412(b) to make fee awards dependent on judges’ powers of imagination.

11 . Our conclusion that the fee award under § 2412(b) was erroneous makes it unnecessary to address the government’s argument that the district court improperly awarded fees for the proceedings before the BCNR.

The government’s argument that EAJA does not allow fee awards for work done before October 1, 1981 is resolved by our decision in Rawlings v. Heckler, 725 F.2d 1192 (9th Cir.1984). Rawlings holds that EAJA allows recovery of fees incurred before October 1, 1984 in cases pending on that date. 725 F.2d at 1194-95.

12 . Lauritzen argues that the district court abused its discretion by failing to hold a separate evidentiary hearing to determine if the government’s position was substantially justified. EAJA does not generally require district courts to hold separate proceedings to evaluate the merits of the government’s position. Although the government bears the burden of showing that its position is substantially justified, EAJA does not require independent evidence — as distinct from the record on the merits — to satisfy the government’s burden of proof. If the district court is satisfied that the record on the merits establishes that the government’s position had a reasonable basis in law and fact, there is no requirement for a separate hearing on this issue. See Dougherty v. Lehman, 711 F.2d 555, 561-62 (3d Cir.1983).

13 . Under the "bad faith” exception, the common law allows attorney’s fees when one party has acted in bad faith, vexatiously, wantonly, or for oppressive reasons. See Foster v. Tourtellotte, 704 F.2d 1109, 1111 (9th Cir.1983). Section 2412(b) allows awards under this exception, see, e.g., Rose v. United States Postal Service, 725 F.2d 1249, 1257 (9th Cir.1984), but an award of attorney’s fees based on bad faith is punitive, and "the penalty can be imposed only in exceptional cases and for dominating reasons of justice.” United States v. Standard Oil Co., 603 F.2d 100, 103 (9th Cir.1979) (quoting 6 J. Moore, Federal Practice ¶ 54.77[2], at 1709-10 (2d ed. 1972)).