Paul A. Blackburn v. Robert B. Reich, Secretary of Labor Metric Constructors, Incorporated

79 F.3d 1375, 11 I.E.R. Cas. (BNA) 914, 1996 U.S. App. LEXIS 5335

• Court: Court of Appeals for the Fourth Circuit
• Decided: March 26, 1996
• Docket: 95-1166
• Status: Published

Opinions

Vacated and remanded by published opinion. Judge K.K. HALL wrote the majority opinion, in which Senior Judge BUTZNER joined. Judge WILLIAMS wrote a dissenting opinion.

OPINION

K.K. HALL, Circuit Judge:

Paul A. Blackburn seeks review of the Secretary of Labor’s final decision that denied attorney’s fees for the prosecution of a prior appeal to this court. We vacate the Secretary’s decision and remand for reconsideration of Blackburn’s fee petition.

I

Metric Constructors, Inc., was an independent contractor that performed construction work at a nuclear power plant in South Carolina. Blackburn, an electrician with Metric, was fired on September 5,1984, for his refusal to work at the plant unless protective lead shielding was put in place at the worksite. He filed a complaint against Metric with the Secretary of Labor under the employee protection provisions of the Energy Reorganization Act (ERA), 42 U.S.C. § 5851 (1988) ¹. After finding a violation and ordering Metric to reinstate Blackburn, the Secretary remanded the case to an administrative law judge (AL J) for a determination of back pay, compensatory damages, and attorney’s fees.

The ALJ recommended an award of back pay covering the period of September 5, 1984, through December 31, 1987, compensatory damages of $10,000 for emotional distress and mental anguish, and attorney’s fees and costs. Both parties filed exceptions to the recommendations. In a decision issued October 30, 1991, the Secretary determined that back pay could not be awarded for the period after December 31,1984, when Metric lost the contract for work at the nuclear plant. With regard to compensatory damages, the Secretary viewed Blackburn’s claim as being based on the stress resulting from “diminished financial situation brought about because of his inability to find a job following his termination from Metric.” Finding that Blackburn had not suffered any financial loss as a result of his termination, the Secretary ruled that an award for emotional distress was inappropriate. Blackburn sought review in this court.² 42 U.S.C. § 5851(c)(1).

We affirmed the decision with regard to the back pay award. We held, however, that injuries, such as loss of self esteem arising from the termination itself, could justify an award of compensatory damages despite the absence of adverse financial consequences. Accordingly, we remanded to the Secretary for a redetermination of compensatory damages. Blackburn v. Martin, 982 F.2d 125 (4th Cir.1992) (Blackburn I).

On August 16, 1993, the Secretary ordered Metric to pay $5,000 in compensatory damages. Two weeks later, Blackburn filed a petition for costs and attorney’s fees covering the period from November 15, 1991, through August 27,1993. On December 27,1994, the Secretary awarded attorney’s fees and costs for Blackburn’s lawyers’ efforts after the remand in Blackburn I, but he denied all fees and costs incurred in relation “to preparing and conducting the appeal” to this court. The denial was expressly based on the Secretary’s view that he does not have the statutory authority to award fees for work performed before an appellate court. Blackburn now appeals this fee ruling.

II

42 U.S.C. § 5851(b)(2)(B) provides that, if an order is entered granting relief to a person who has suffered discrimination in violation of the ERA, the Secretary

shall assess against the person against whom the order is issued a sum equal to the aggregate of all costs and expenses (including attorneys’ and expert witness fees) reasonably incurred, as determined by the Secretary, by the complainant for, or in connection with, the bringing of the complaint upon which the order was issued.

The Secretary’s ruling was expressly based on the majority opinion in DeFord v. Secretary of Labor, 715 F.2d 231 (6th Cir.1983), which, the Secretary reasoned, “squarely held that neither the court nor the Secretary is authorized under the ERA to award costs, including attorney’s fees, for proceedings on appeal to the court of appeals.” As a matter of statutory interpretation, our review is de novo.3

A

Although the DeFord majority’s analysis is not entirely clear, we understand it to proceed as follows: Section 5851(b)(2)(B) allows the Secretary to award attorney’s fees as part of “costs and expenses”, and the court of appeals clearly should award “costs” to the party prevailing on appeal (presumably under Fed. R.App. p. 39); therefore, the Secretary and the court have mutually exclusive authority to award “costs” for the portions of the case at the different levels, and the Secretary’s cost-awarding authority (which includes his fee-awarding authority) is limited to the administrative sphere “as a jurisdictional or quasi-jurisdictional matter.” Id. at 232. The DeFord majority also noted that, while the “costs and expenses” under § 5851 had to be “for, or in connection with, the bringing of the complaint” against the employer, the appeal in that case involved a “distinguishable cause — complaints against the Secretary arising out of dissatisfaction with his order.” Id. at 233. Neither prong of this rationale withstands scrutiny.

In this circuit, “[t]he only costs generally taxable in the court of appeals are: (1) the docketing fee if the case is reversed; and (2) the cost of printing or reproducing briefs and appendices, including exhibits.” Internal Operating Procedures (IOP) 39.1. Other costs associated with an appeal, such as the fee for preparing the record, are taxable in the district court. Fed. R.App. P. 39(e); IOP 39.1. Thus, in the usual case, two levels — the district court and the court of appeals — are satisfying the entitlement to “costs” incident to the appeal. There is, in short, no impenetrable barrier between the various levels of the court system as far as costs are concerned, and, as a general matter, we see no problem whatsoever with permitting the Secretary to award appeal-related “costs” when the appeal is from an agency to the court of appeals.⁴

The other basis for the holding in DeFord is that the appeal involved a dispute with the Secretary rather than the respondent-employer and, therefore, on appeal the complainant “did not incur any attorneys’ fees or other costs for litigation of claims arising from the complaint_” Id. at 233. Every appeal arises from dissatisfaction with the order appealed from, and, in that sense, every appeal involves a dispute with the deci-sionmaker. But it was Metric’s successful litigation position at the administrative level that necessitated Blackburn’s first appeal, and, as we explain below, the legal fees incurred in pursuing that appeal were every bit as “in connection with” his claim as were the fees for the administrative efforts.⁵

B

The Secretary raises some additional arguments not addressed in DeFord, one of which looks to the arrangement of the subsections in § 5851 for support. Section 5851(b) authorizes the Secretary to enter remedial orders that may include reinstatement, back pay, and compensatory damages. The next three subsections relate directly to any such orders: Subsection (c) provides for review of the Secretary’s order in the court of appeals, subsection (d) gives the Secretary the right to file a separate action in district court to enforce its order, and subsection (e) gives the individual complainant the right to file a separate enforcement action in district court. Only subsections (b) and (e), however, contain specific provisions for attorney’s fees, and the Secretary argues that the absence of a similarly specific provision in (c) evinces Congressional intent to limit his authority to award fees to the administrative proceedings alone. To whatever degree this arrangement tilts in favor of the Secretary’s position, it is far from enough to overcome other, brighter indicators of Congressional intent.⁶

At the core of much of the Secretary’s argument is the premise that “[t]he bringing of a complaint under the whistleblower provision of the ERA is a completely separate action from filing a petition for review under that provision.” Respondent’s brief at 12. Were this actually the case, we might be persuaded that the Secretary is precluded from awarding appellate fees. But an appeal is simply one step in the overall adjudicatory scheme, not a “separate action.” See DeFord, 715 F.2d at 233 (“[Rjeview in the Court of Appeals is not a new action.... [I]t is simply a continuation of the action before the Secretary.”) (Merritt, J., dissenting). A semantically and logically more defensible interpretation of the phrase “in connection with the bringing of the complaint” is “in connection with the claim”; very simply, all litigation-related efforts should be compensa-ble.

C

The overarching purpose of the statute— the protection of whistleblowers — militates against an interpretation that would make anti-retaliation actions more difficult to maintain. In Local 17, Internat’l Ass’n of Heat and Frost Insulators v. Young, 775 F.2d 870 (7th Cir.1986), the court of appeals affirmed an award of attorney’s fees to plaintiffs for successfully resisting the defendants’ petition for certiorari to the Supreme Court, despite the absence of any specific statutory language giving the lower court the authority to award fees for appellate work. In finding that Congress intended that the lower court have such authority, the appeals court emphasized the overall purpose of the statutory scheme at issue:

If disgruntled union members, as prevailing plaintiffs, were forced to incur costs for unsuccessful, fruitless Union appeals, this would have a chilling effect on union members’ ability to afford challenging the union leadership. Situations would develop where union officials could willfully violate the law, yet recognize an inability on the part of their membership to challenge the Local hierarchy in court due to a lack of funds_ [D]ue to the uneven bargaining positions of the parties, the purpose of the LMRDA would be frustrated.

Id, at 873. The same rationale should apply with equal or greater vigor in the realm of nuclear safety.⁷

D

The Secretary’s final argument is a variation on the others: “When Congress wants to award attorney’s fees and costs for judicial review, it knows how to do so.” Respondent’s brief at 16. The Secretary has not pointed us to any statutory scheme wherein attorney’s fees are recoverable for some, but less than all, the litigation expenses in a single action. Quite the opposite appears to be the general rule; if fees are authorized at all, they are recoverable for all phases of the litigation, and, moreover, appellate fees can be awarded by a lower court. See, e.g., Goodwin v. Metts, 973 F.2d 378, 384-85 (4th Cir.1992) (per curiam) (reviewing appellate fees awarded under 42 U.S.C. § 1988 by the district court); McManama v. Lukhard, 616 F.2d 727, 730 (4th Cir.1980) (per curiam) (remanding to the district court “for assessment of additional attorneys’ fees ... to compensate the plaintiffs for the expense of their successful defense of [defendant’s] appeal”).

The authorities cited by the Secretary do not hold otherwise. In both Roosevelt Campobello International Park Commission v. U.S.E.P.A., 711 F.2d 431 (1st Cir.1983), and Key Tronic Corp. v. United States, - U.S. -, 114 S.Ct. 1960, 128 L.Ed.2d 797 (1994), the issue was whether attorney’s fees could be awarded at all for a distinct type of action.⁸ Neither of these eases holds that attorney’s fees may be recoverable for work related to only one of the various levels of a given contested case.

Ill

We hold that attorney’s fees related to prosecuting an appeal before the court of appeals are “costs ... incurred ... in connection with [ ] the bringing of [a] complaint” under § 5851(b), and, therefore, the Secretary has the authority to award such fees. We vacate the Secretary’s final decision and remand with instructions to reconsider Blackburn’s third fee petition in light of the foregoing opinion.

VACATED AND REMANDED.

1 . The statute was amended extensively in 1992, although the portions of the statute that are relevant to this appeal, subsections (b)(2)(B) through (g), remained unchanged. See Pub.L. 102-486, Title XXIX, § 2902(a)-(g), (h)(2), (3). We are dealing with the pre-amendment version here.

2 . Blackburn did not seek review of the Secretary’s decision with regard to attorney's fees and costs.

3 . Although the Secretary now contends that we should give deference to his interpretation of the statute under the rule announced in Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), the decision to deny appellate fees was apparently based not on his interpretation of the statute but, rather, on his belief that he was required to follow the holding in DeFord. The order on appeal reads in relevant part:

Based on DeFord, I disallow the entries [in the fee petition] that relate to preparing for and conducting the appeal. Contrary to Complainant’s arguments, the court in DeFord squarely held that neither the court nor the Secretary is authorized under the ERA to award costs, including attorney's fees, for proceedings on appeal to the court of appeals.[] The Secretary has applied this holding in other cases arising under analogous statutes. See Spinner v. Yellow Freight Sys., Inc. ... On the other hand, contrary to Respondent’s position, DeFord does not foreclose an award of fees incurred by a complainant in proceedings before the Secretary on remand.

(Spinner, which does contain a cf. citation to DeFord, did not involve attorney's fees for appellate work, and the holding in DeFord was in no way "applied”.) DeFord, which predated Chevron, does not mention, much less give deference to, whatever the Secretary's view of the statute was in 1984. Because the Secretary based his decision in the instant case on judicial precedent rather than his own interpretation of the statute, we owe “no more deference than we would any lower court’s analysis of the law.” Thomas Hodgson & Sons, Inc. v. F.E.R.C., 49 F.3d 822, 826 (1st Cir.1995).

4 . In Blackburn I, neither party filed a bill of costs with the clerk of the court of appeals.

5 . As far as attorney's fees are concerned, the situation would be precisely the same had Blackburn I involved an appeal by Metric from, say, the Secretary’s decision awarding four months’ back pay. Blackburn would have had to defend the award, yet, under the Secretary’s reasoning, he would have been unable to recoup attorney's fees expended to uphold the award.

6 . It should be obvious that it is necessary to have at least the two fee provisions that are in the statute. Because the enforcement action is a separate action that is initiated in the district court and which never comes before the Secretary, a separate authorization to award fees, directed to the district court rather than the Secretary, was necessary in (e).

7 . Blackburn's lawyers claimed some $10,000 in fees for the appeal in Blackburn I. The prospect of an unrecoverable expenditure of this magnitude, particularly when balanced against the level of recovery involved in this case, illustrates how the threat of an appeal could well diminish a complainant’s chances of achieving full relief under the statute.

8 . In Roosevelt Campobello, the issue was whether fees could be awarded to persons who initiated a petition for review in the court of appeals under 33 U.S.C. § 1369(b). In Key Tronic, the issue was whether litigation-related attorney’s fees expended in a contribution action could be deemed a recoverable “necessary cost of response” under § 107(a)(4)(B) of CERCLA.