Lundin v. Mecham (In re Benny)

81 F.3d 91, 1996 WL 167580
CourtCourt of Appeals for the Ninth Circuit
DecidedMarch 18, 1996
DocketNo. 94-16242
StatusPublished
Cited by1 cases

This text of 81 F.3d 91 (Lundin v. Mecham (In re Benny)) is published on Counsel Stack Legal Research, covering Court of Appeals for the Ninth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Lundin v. Mecham (In re Benny), 81 F.3d 91, 1996 WL 167580 (9th Cir. 1996).

Opinion

GOODWIN, Circuit Judge:

A decade after the constitutionality of the current bankruptcy court structure was settled, the denial of attorney fees to the six bankruptcy judges whose efforts, as amici, had brought about the solution that satisfied both the Constitution and the judges, has produced this appeal.

The six bankruptcy judges were plaintiffs in the first case in a series of constitutional challenges to the 1984 Bankruptcy Act. Lundin v. Mecham, 980 F.2d 1450 (D.C.Cir. 1992). After the Supreme Court held the Bankruptcy Reform Act of 1978 unconstitutional in Northern Pipeline Constr. Co. v. Marathon Pipe Line Co., 458 U.S. 50, 102 S.Ct. 2858, 73 L.Ed.2d 598 (1982), Congress passed several interim measures to keep the bankruptcy courts operational until it finally enacted the Bankruptcy Amendments and Federal Judgeship Act of 1984.

The last of the interim measures expired two weeks before Congress passed the 1984 Act. To remedy the lapse, Congress added a holdover provision that allowed all bankrupt/ cy judges to remain in office until the Act became effective.

[93]*93The Director of the Administrative Office of the U.S. Courts, on the advice of counsel, challenged the 1984 Act on the ground that it violated the Appointments Clause of the Constitution. The Honorable Keith M. Lundin and five fellow bankruptcy judges then filed for declaratory relief from the Director’s challenge in the District Court in the District of Columbia. Meanwhile, in the Northern District of California, Alexandra Benny, a bankrupt debtor, challenged the authority of the bankruptcy judge to whom her case had been referred. In re Benny, 791 F.2d 712 (9th Cir.1986).

The six plaintiff judges in the Lundin case and the director all sought to intervene in Benny, and at the same time, filed a joint motion to stay the proceedings in Lundin pending developments in Benny. Five other cases based on the same challenge to the 1984 Act arose in other jurisdictions.

Judge Robert Schnacke denied the judges’ motion to intervene, but treated them as amici curiae. The Department of Justice participated in Benny, arguing the same position it had advocated in Lundin. The position of the judges, but not the judges themselves, ultimately prevailed in Benny. The final decision of Judge Schnake in Benny was, verbatim, the amicus brief filed by the judges, who were technically nonparties.

After Benny, and all of the other courts that reached the issue, upheld the constitutionality of the Bankruptcy Act, Lundin was dismissed as moot. The judges then filed for a fee award under the Equal Access to Justice Act in the D.C. district court. The district court denied their application for fees, but the D.C. Circuit reversed and awarded fees for their work in Lundin. That circuit, however, declined to award fees for any of the amicus work in Benny or in the five other cases.

The six bankruptcy judges then filed in the Northern District of California an application for fees for their work as amici in the Benny case. That district court denied their fee request because they were not “parties” within the meaning of the Equal Access to Justice Act.

This appeal raises the question whether, on this unusual record, the six judges who carried the litigation to a successful conclusion were prevailing parties within the meaning of the EAJA. The statute provides for fee awards to prevailing parties in any court having jurisdiction in an action brought by or against the United States unless the position of the United States was substantially justified or other special circumstances make the award unjust. 28 U.S.C. § 2412(a-d) (1995).

The appeal is complicated by In Re Benny, 791 F.2d 712 (9th Cir.1986), in which we affirmed the Northern District order denying leave to the six bankruptcy judge plaintiffs in the Lundin case to intervene and be treated as parties in Alexandra Benny’s challenge to the constitutionality of the bankruptcy court hearing her case. The government now says that our affirmance of the order of the district court denying intervention is the law of the case, and that we should not reconsider our early decision denying them party status nunc pro tunc in order that they may be awarded party status and EAJA fees for their work.

Our decision in 1986 was based upon the record then before the court, which was that six judges who were not sitting in any district within this circuit could not be affected by the trial court’s decision in the then pending Benny bankruptcy in the district court, and therefore there was no abuse of discretion in denying intervention. In re Benny, 791 F.2d 712 (9th Cir.1986). That decision, published before the outcome of the Benny bankruptcy case or of the Lundin case in the D.C. Circuit could be known, rested primarily on the holding that the six judges had failed to demonstrate that the outcome of the Benny bankruptcy was capable of affecting their interest. Id. at 721. The possibility of Benny affecting the judges interests was “too tenuous to entitle them to intervene as of right.” Id.

The threshold issue that we must address is whether the six judges are time barred in seeking reconsideration of this court’s earlier ruling. The judges are not time barred because their appeal is timely. It raises the question of law whether the district court was correct in ruling that the [94]*94bankruptcy judges are not entitled to fees because they were not intervenors, but “merely” amici in the district court.

On the record before this court in 1986, the six judges seeking to intervene were not entitled to intervention as a matter of right ■under F.R.Civ.P. 24(a) and the district court probably did not abuse its discretion at that time in denying intervention by permission pursuant to F.R.Civ.P. 24(b) because any decision by the district court on Alexandra Benny’s claim that the bankruptcy law was unconstitutional would have no binding effect on any of the six “foreign” judges. However, as a practical matter, the only relevant and effective legal presentation to the district court on the constitutional question was contained in the brief filed by the six judges as amici, and indeed, that brief became both the framework and the text of the decision of the district court on the constitutional question. In every respect except the formal designation as parties, the six judges were the real parties in interest in the decision on the constitutionality of the statute under which all bankruptcy judges were then holding office. Soon after the In re Benny decision, the government conceded in the Lundin case and it was dismissed as moot. On any rational basis in which the purpose of the EAJA is considered with reference to the work done in Benny by and for the six judges as amici, that legal representation won the case, and should be paid for pursuant to the act.

The doctrine of “the law of the case” does not preclude our review of the denial of attorney fees now that the In re Benny litigation is concluded. As pointed out recently in

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Related

In Re Benny
81 F.3d 91 (Ninth Circuit, 1996)

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Bluebook (online)
81 F.3d 91, 1996 WL 167580, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lundin-v-mecham-in-re-benny-ca9-1996.