United States v. Ranger Elec

• Court: Court of Appeals for the Sixth Circuit
• Decided: April 24, 2000
• Docket: 98-2322
• Status: Published

Opinion

RECOMMENDED FOR FULL-TEXT PUBLICATION 20 United States v. Ranger Nos. 98-2255/2322 Pursuant to Sixth Circuit Rule 206 Electronic Communications ELECTRONIC CITATION: 2000 FED App. 0146P (6th Cir.) File Name: 00a0146p.06

behalf); Caremore, Inc. v. NLRB, 150 F.3d 628, 630 (6th Cir. 1998) (concluding that Caremore was litigating on its own UNITED STATES COURT OF APPEALS behalf, and “the merits of the underlying case involved a bargaining unit consisting solely of Caremore employees”); FOR THE SIXTH CIRCUIT National Truck Equipment Ass. v. National Highway Traffic _________________ Safety Admin., 972 F.2d 669 (6th Cir. 1992) (aggregating member companies because trucking association was ; litigating on behalf of those companies).  UNITED STATES OF AMERICA,  I believe that aggregation is clearly appropriate in this case. Plaintiff-Appellant/  The “parties” in the litigation comprised closely linked Cross-Appellee,  entities. Peng was the president and chief financial officer of Nos. 98-2255/2322

 Ranger USA. Peng owned fifty-two percent of Ranger > v.  Taiwan, approximately 100 percent of Ranger Shanghai, and

 100 percent of Ranger USA. Ranger Taiwan owned almost

 100 percent of Ranger Malaysia. Most importantly, unlike the RANGER ELECTRONIC

Defendant-Appellee/  Caremore and Tri-State Steel cases, Peng, Ranger and the COMMUNICATIONS, INC.,

Cross-Appellant.  other co-defendants essentially litigated as a bloc, rather than

 as independent entities. The very basis of the plea agreement

1 was that Peng controlled each of the companies and their respective litigation decisions. Indeed, the plea agreement constituted an internal trade-off engineered by Peng—dismissing charges against him personally and Ranger Appeal from the United States District Court in exchange for a guilty plea by Ranger USA, a plea of no for the Western District of Michigan at Grand Rapids. contest by the unindicted co-conspirator (Ranger Shanghai), No. 96-00211—Richard A. Enslen, Chief District Judge. and Peng’s agreement to pay Ranger USA’s forfeiture amount personally. J.A. at 195-201. Ranger’s argument that the Argued: January 26, 2000 “other Ranger companies’ pleas” can not be imputed to Ranger is thus unpersuasive. Rather, aggregation is wholly Decided and Filed: April 24, 2000 appropriate. Before: JONES, NORRIS, and SILER, Circuit Judges. At the onset of litigation, Ranger Malaysia had 485 employees, Ranger Shanghai had 185 employees, and Ranger _________________ had twelve employees. J.A. at 417. A Dun & Bradstreet report from November 1996 reported that the Ranger COUNSEL companies together had more than 800 plant workers. ARGUED: Joan E. Meyer, ASSISTANT UNITED STATES Because the aggregated entities have well over 500 ATTORNEY, Grand Rapids, Michigan, for Appellant. employees, Ranger is ineligible to bring a Hyde Amendment Daniel R. Gravelyn, WARNER, NORCROSS & JUDD, claim. Grand Rapids, Michigan, for Appellee. ON BRIEF: Joan E.

1 2 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 19 Electronic Communications Electronic Communications

Meyer, ASSISTANT UNITED STATES ATTORNEY, Grand B. Rapids, Michigan, for Appellant. Daniel R. Gravelyn, WARNER, NORCROSS & JUDD, Grand Rapids, Michigan, Ranger, however, must live with the consequences of being for Appellee. treated as one with the other co-defendants. In particular, grouping the co-defendants into one entity means that Ranger SILER, J., delivered the opinion of the court, in which was not an “eligible” party under § 2412(d). For that reason, NORRIS, J., joined. JONES, J. (pp. 14-20), delivered a the award to Ranger must be reversed. separate concurring opinion. A party is only eligible to receive a Hyde award if it is: _________________ (i) an individual whose net worth did not exceed OPINION $2,000,000 at the time the civil action was filed, or (ii) _________________ any owner of an unincorporated business, or any partnership, corporation, association, unit of local SILER, Circuit Judge. The government appeals from an government, or organization, the net worth of which did award of attorneys’ fees and costs to Ranger Electronic not exceed $7,000,000 at the time the civil action was Communications, Inc. (“Ranger”) under the Hyde filed, and which had not more than 500 employees at the Amendment. Ranger was indicted for violating 18 U.S.C. time the civil action was filed . . . . §§ 545 and 1956(a), importing illegal radio equipment and related money laundering charges. The prosecution ended in 28 U.S.C. § 2412(d)(2)(B). In this case, as in previous cases a dismissal with prejudice of the illegal importation charges under the EAJA, the rather straightforward analysis of against Ranger and its primary officer, Jim Peng, but an eligibility is complicated because several related companies associated corporation, Ranger USA, also owned by Peng, and individuals, including subsidiaries, are the co-defendants. pled guilty to money laundering in violation of 18 U.S.C. We are thus presented with the question of whether to § 1956(a)(2) and agreed to a criminal forfeiture of aggregate the assets and employees of the related companies, $990,000.000. Another sister corporation, Ranger Shanghai, or look independently at the particular entity bringing the pled no contest to one count of importing merchandise in Hyde Amendment claim. Contrary to Ranger’s argument, in violation of 18 U.S.C. § 545. analogous EAJA cases, this Court has not simply “adhered to the principle that corporations, even if ‘related,’ must be On appeal, the government argues that Ranger did not file treated as independent entities.” Ranger’s Br. at 27. In fact, a timely request for attorneys’ fees and costs under the Hyde “a rule that would prevent aggregation under any Amendment,1 and that, even if timely filed, as a matter of circumstances would contravene the purpose of EAJA.” Tri- State Steel Construction Co. v. Herman, 164 F.3d 973, 981 (6th Cir. 1999) (Gilman, J., concurring). We therefore look 1 beyond the formal structure of the litigating parties to inquire Pub. L. No. 105-119, 111 Stat. 2440, 2519 (1997) (reprinted in 18 whether a purported independent entity is litigating on its own U.S.C. § 3006A, historical and statutory notes). In its entirety, the Hyde behalf, or on behalf of other, related entities as well. See id. Amendment provides: During fiscal year 1998 and in any fiscal year thereafter, the at 979-80 (majority concluding that Tri-State, despite its close court, in any criminal case (other than a case in which the relationship with parent company, was litigating on its own defendant is represented by assigned counsel paid for by the 18 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 3 Electronic Communications Electronic Communications

In my view, however, final judgment did not occur until law, there was no “vexatious, frivolous, or bad faith” May 19, 1998, the date of the sentencing order. In the prosecution as required under the Act. We hold the Hyde2 criminal context, an order is final and appealable only after Amendment incorporates the Equal Access to Justice Act’s both conviction and sentencing. See Flanagan v. United (“EAJA”) thirty-day time limit for filing claims. As set forth States, 465 U.S. 259, 263 (1984); United States v. One below, we REVERSE for lack of jurisdiction. Juvenile Male, 40 F.3d 841, 843 (6th Cir. 1994). Even when there is a plea agreement and a dismissal of charges, the I. BACKGROUND dismissal of those charges is not final until the sentencing order is issued for the charges that remain. The rationale for On December 19, 1996, Ranger, Ranger USA, and Peng this rule is that until the sentencing order issues, the were indicted for illegal importation of radio equipment in possibility remains that the defendant will either breach or violation of 18 U.S.C. § 545. In addition, Ranger, Ranger withdraw the plea, at which point the previously dismissed USA, Peng and John Gouvion, the president of Ranger USA, charges can be reinstated. In this case, Ranger USA was were indicted for conspiracy to import and sell electronic sentenced pursuant to the plea agreement on May 19, 1998. devices in violation of 18 U.S.C. § 545. On March 27, 1997, Prior to sentencing, Ranger USA could have negated the plea a superseding indictment charged that Ranger, Ranger USA agreement by moving to withdraw the plea under Fed. R. and Peng conspired to violate the customs laws in violation of Crim. Pro. 32(e) or by breaching one of the agreement’s 18 U.S.C. §§ 371 and 545; conspired to commit money conditions. After such a withdrawal, the government would no longer have been bound by the dismissal of the charges against Ranger, and could re-prosecute those charges. J.A. at 199-200. For this reason, the May 19 sentencing order, not public) pending on or after the date of the enactment of this act the earlier dismissal of the charges against Ranger, constituted (Nov. 26, 1997), may award to a prevailing party, other than the United States, a reasonable attorney’s fee and other litigation the relevant final judgment. expenses, where the court finds that the position of the United States was vexatious, frivolous or in bad faith, unless the court This conclusion of course hinges on an underlying finds that special circumstances make such an award unjust. determination that the co-defendants in the case should be Such awards shall be granted pursuant to the procedures and treated as one party. Technically, Ranger itself did not reach limitations (but not the burden of proof) provided for an award under Title 28, U.S.C. § 2412. To determine whether or not to a plea agreement, only Ranger USA did. A strictly award fees under this section, the court, for good cause shown, formalistic approach would therefore deem Ranger’s filing of may receive evidence ex parte and in camera (which shall the Hyde award claim untimely. But because the co- include the submission of classified evidence or evidence that defendants in this case were essentially litigating as one, see reveals or might reveal the identity of an informant or infra, and withdrawal or breach by Ranger USA before undercover agent or matters occurring before a grand jury) and sentencing would have terminated the entire agreement, I evidence or testimony so received shall be kept under seal. Fees and other expenses awarded under this provision to a party shall believe that the sentencing order for Ranger USA constituted be paid by the agency over which the party prevails from any the final order with respect to all the parties in this case. funds made available to the agency by appropriation. No new Therefore, the May sentencing order of Ranger USA and appropriations shall be made as a result of this provision. Ranger Shanghai comprised the final order for the dismissal 2 of charges against Ranger, and Ranger’s filing on June 19 was The Equal Access to Justice Act, 28 U.S.C. § 2412 et seq., timely. authorizes the award of attorneys’ fees and costs to private parties who prevail against the government in civil actions. 4 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 17 Electronic Communications Electronic Communications

laundering in violation of 18 U.S.C. § 1956(h); brought (1991). Because the thirty-day deadline is jurisdictional, see merchandise into the United States contrary to law in Allen v. Secretary of Health & Human Serv., 781 F.2d 92, 94 violation of 18 U.S.C. § 545; and committed money (6th Cir. 1986), a district court is permitted to extend the laundering in violation of 18 U.S.C. § 1956(a)(1) and deadline in only one instance: when a party has “performed an (a)(2)(A). act which, if properly done, would have postponed the deadline for filing his application,” and a court has At the time of the indictments, Federal Communications affirmatively assured a party that the act was properly done. Commission (“FCC”) regulations required that Citizens Band United States v. Lindert, No. 96-4321, 1998 WL 180519 at *4 (“CB”) radios be “type accepted”3 by the FCC before they (6th Cir. 1998) (unpublished opinion); cf. Osterneck v. Ernst could be distributed in this country. See 47 C.F.R. §§ 2.803 & Whitney, 489 U.S. 169, 179 (1989) (concluding that an and 95.603. The government argued the radios that were appellate court can forgive a party’s failure to file a timely specified in the indictments were “open” radios, which appeal “only where a party has performed an act which, if operate illegally in that they are not restricted to the forty CB properly done, would postpone the deadline for filing his bands, but operate on additional channels as well. Defendants appeal and has received specific assurance by a judicial argued the radios were “amateur” radios and thus imported officer that this act has been properly done”). under an exemption. The district court found that “[t]he radios in question were not type accepted by the FCC and According to the majority, adherence to the thirty-day would not have been type accepted because they broadcast on deadline dooms Ranger’s award application. The case against frequencies other than those approved by the FCC.” United Ranger ended on January 22, 1998, with Ranger USA’s guilty States v. Ranger Electronic Communications, Inc., 22 F. plea and Ranger Taiwan’s plea of no contest. The district Supp. 2d 667, 670 (W.D. Mich. 1998). court entered judgment terminating the criminal case against Ranger on February 3, 1998. The majority therefore finds that Ranger attempted to obtain exculpatory material from the Ranger’s filing on June 111, 1998 came well after the thirty- government pursuant to Brady v. Maryland, 373 U.S. 83 day window had closed. (1963). In March 1997, defense counsel sought production of “all evidence known to the government which may be favorable to the defendant and material either to guilt or punishment.” In April 1997, the government agreed “to provide all Brady, Giglio, and Jencks material on January 9, 1 1998 - three days before trial.” The district court circumvented this bar to Ranger’s application by carving out an “equitable tolling” exception to this jurisdictional requirement, allowing a “limited extension of the application period” in Defense counsel also tried to obtain evidence from the FCC a situation where the government has concealed exculpatory evidence. to help prove that the regulations in question were vague. In United States v. Ranger Electronic Communications, Inc., 22 F.Supp.2d June 1997, they made requests under the Freedom of 667, 675 (W.D. Mich. 1998). This was error for two reasons. Most seriously, the court’s tolling defied precedent that courts can not extend a jurisdictional deadline except in the narrow circumstance described supra, which was not present in this case. Second, even assuming 3 arguendo that some form of equitable tolling is permissible, because Under the FCC regulations, radios cannot operate on the CB band Ranger filed its Hyde Amendment claim 30 days after it had received the unless express approval is obtained from the FCC to operate on the CB FOIA documents, the district court’s extension of time into June was channels. unreasonable. 16 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 5 Electronic Communications Electronic Communications

tasked with showing that the government’s “position” was Information Act4 (“FOIA”) for documents that related to CB “vexatious, frivolous, or in bad faith.” See id. at 1300-02. and amateur radios. On June 20 and August 8, 1997, the FCC Still, the Hyde Amendment’s origin as a replica of § 2412(d) declined to produce several of the requested documents on the provides additional support for applying the procedures of grounds that they would “interfere with an ongoing criminal § 2412(d). In sum, I agree with the majority that the Hyde investigation.”5 The FCC arrived at this conclusion based at Amendment requires a criminal defendant to meet the least in part on the recommendation of AUSA Daniel Mekaru, limitations and procedural requirements of § 2412(d). who, along with AUSA Mark Courtade, handled the Ranger prosecution. II. In August 1997, the district court ruled that the FCC I believe that Ranger failed to meet the requirements under regulations regarding “open” radios were clear and § 2412(d), but not for the reason articulated by the majority. unambiguous. On January 9, 1998, the court ruled the While Ranger filed its application for an award in a timely defendants could not attack the FCC regulations for being manner, it did not meet the eligibility criterion of having not confusing, but they could present evidence that they were more than 500 employees. confused about the regulations and that they reasonably believed the radios were legal “amateur” radios and not A. illegal, non-type-accepted CB radios. Unlike the majority, I believe that Ranger satisfied the In early January 1998, the FCC advised the prosecutors it thirty-day deadline to file for an award of attorney’s fees. had discovered approximate 400 more documents responsive Section 2412(d)(1)(B) requires that to the FOIA request. The prosecutors asked the FCC to immediately fax those documents that the FCC thought were [a] party seeking an award of fees and other expenses important for the prosecutors to review. The prosecutors shall, within thirty days of final judgment in the action, received the facsimiles on or about January 12, 1998. Among submit to the court an application for fees and other these selected documents were some of the e-mails attached expenses which shows that the party is a prevailing party to Ranger’s Hyde motion. The prosecutors examined the and is eligible to receive an award under this subsection, facsimiles and concluded that they, like the FCC documents and the amount sought, including an itemized statement they had reviewed in July 1997, concerned only “modifiable” from any attorney or expert witness representing or radios and contained no reference to “open” radios. In appearing in behalf of the party stating the actual time addition, they were created outside the time frame charged in expended and the rate at which fees and other expenses the indictment. Thus, the prosecutors determined not to were computed. produce them. On the date the trial began, January 13, 1998, 28 U.S.C. § 2412(d)(1)(B) (emphasis added). The EAJA defines a final judgment as “a judgment that is final and not 4 appealable, and includes an order of settlement.” 28 U.S.C. 5 U.S.C. § 552 et seq. § 2412(d)(2)(G); see Buck v. Secretary of Health and Human 5 Serv., 923 F.2d 1200, 1202 (6th Cir. 1991). The thirty-day The government contends the investigation referred to concerned inquiries into the defendants’ attempts to circumvent the type acceptance clock begins to run after the time to appeal the final judgment requirements for “modifiable” radios, which were not the subject of the has expired. See Melkonyan v. Sullivan, 501 U.S. 89, 96 indictments. 6 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 15 Electronic Communications Electronic Communications

AUSA Courtade told the defendants that he had received Amendment’s clear directive to apply the EAJA’s procedures additional FCC documents which he had yet to review. The and limitations. Moreover, as the majority reasons, § 2412(b) trial ended before the prosecutors completed their review of itself shows that Ranger’s interpretation is circular, as that the FCC FOIA documents. provision explicitly instructs courts to rely on either common law or the “terms of any statute which specifically provides Ranger also attempted to defend the charges by pointing to for such an award” to determine the extent to which the suspicious bank records of Gouvion.6 The defendants United States is liable for an award. 28 U.S.C. § 2412(b). In claimed that Gouvion, the former president of Ranger USA other words, § 2412(b) tells courts to look elsewhere for and a government witness, was embezzling money from procedural guidance. Ranger USA. Defendants based this assumption on a wire transfer confirmation showing that Gouvion had a joint bank In addition, the language and legislative history of the Hyde account with a customer of Ranger USA. In December 1997, Amendment suggest that the Amendment was modeled the defendants subpoenaed the bank records of Gouvion from precisely after § 2412(d), making the application of its 1992 to January 15, 1998. The government’s motion to quash procedures and limitations particularly appropriate. First, the the subpoena was denied by the court on January 16. Hyde Amendment and § 2412(d) mirror one another in that each provides fees when the “position” of the government is On January 14, one day after trial began, AUSA Mekaru flawed. Second, the history of the Amendment evinces an asked Gouvion about the wire transfer. Gouvion stated the even closer connection. To quote the Eleventh Circuit’s wire transfer was for the sale of a Rolex watch to the owner description of the Amendment’s legislative history: of Santa Fe, a company that did business with Ranger USA. AUSA Mekaru asked Gouvion if the loans were a pay-off or Hyde patterned his amendment after the Equal Access to if Gouvion was skimming money from Ranger USA. Justice Act ("EAJA"), see 28 U.S.C. § 2412(d)(1)(A), Gouvion replied that the loans were legitimate. which authorizes the award of attorneys’ fees and costs to private parties who prevail against the government in On January 19, 1998, AUSA Mekaru met with Gouvion to civil actions unless the government establishes that its prepare him for his testimony the following day. At this position was “substantially justified.” See 143 Cong. Rec. meeting, Gouvion admitted he lied about the sale of the Rolex H7786-04, H7791 (Sept. 24, 1997) (statement of Rep. watch. Instead, Gouvion declared he had borrowed money Hyde). Thus, in its original form the Hyde Amendment from Ranger USA and used the joint bank account with the would have allowed the award of attorney fees and costs customer to hide the money. Thus, the government learned of to any federal criminal defendant who prevailed against Gouvion’s lie three days after the hearing on the motion to the government, unless the government showed that its quash the subpoena for Gouvion’s bank records and one day position in the prosecution had been “substantially prior to Gouvion’s testimony in court. justified.” Gouvion testified for the government on January 20-21, United States v. Gilbert, 198 F.3d 1293, 1300 (11th Cir. 1998. On the second day of examination, he testified that the 1999). After criticism by House members and the Department of Justice that the Amendment was too broad, the provision was altered in two ways: the burden of proof was 6 Gouvion pled guilty to accessory after the fact in importing illegal placed on the party seeking the award, and that party was merchandise in violation of 18 U.S.C. § 545. 14 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 7 Electronic Communications Electronic Communications

___________________ money in the joint bank account was for the unauthorized sale of refurbished radios owned by Ranger USA. On re-cross CONCURRENCE examination, defense counsel elicited testimony from ___________________ Gouvion that he had lied and that the claimed personal loans were undocumented, carried no interest rate and had never NATHANIEL R. JONES, Circuit Judge, concurring. I been repaid in whole or in part. concur with the majority’s well-reasoned conclusion that the Hyde Amendment incorporated all the procedures and On January 22, 1998, defense counsel argued the limitations of the EAJA, including § 2412(d), and that prosecutors had committed a Brady violation and the defense reversal is warranted because Ranger failed to meet those was entitled to a dismissal of the indictment. The district criteria. Nevertheless, I disagree with the majority’s court found that the prosecutor intentionally failed to inform determination that Ranger failed to file its application for a defense counsel prior to Gouvion’s testimony that the story Hyde Award within thirty days of the final judgment. My about the Rolex watch was a lie. The court concluded this conclusion instead rests on the fact that Ranger was not an was a Brady violation, but specifically found that the defense eligible corporation under § 2412(d). had not suffered any prejudice because they confronted Gouvion about the lie on re-cross examination. Additionally, I. defense counsel admitted he was not prejudiced. The court offered the defense a mistrial which the defense declined. Looking closely at the language and history of the Hyde Amendment, I agree with the majority that by incorporating A plea agreement was reached shortly thereafter, so the the EAJA’s “procedures and limitations,” the Hyde case ended without a jury verdict. Under the plea agreement, Amendment also adopted the restrictions set forth in charges against Peng and Ranger were dismissed while § 2412(d). I find unpersuasive Ranger’s argument that it can Ranger USA pleaded guilty and Ranger Shanghai, which had satisfy the procedural requirements of the Hyde Amendment not been charged up to that time, pleaded no contest, with a only by complying with § 2412(b), which provides neither $990,000.00 forfeiture. procedural guidance nor eligibility limitations. Ranger thus was required to file for fees within thirty days of a non- The judgment terminating the criminal case against Ranger appealable final judgment and to meet the requirements for was entered on February 3, 1998. Ranger refused to withdraw eligibility as defined under § 2412(d). its motion to obtain FCC documents under the FOIA, so it received on March 30, 1998, the documents pursuant to the First, as the majority opines, the Government’s reading is request. However, it was not until June 9, 1998, that Ranger the only fair interpretation of the statutory language of the filed its motion for attorneys’ fees and costs under the Hyde Hyde Amendment, which references all of § 2412 and not its Amendment. The district court recognized that the specific provisions. There is nothing to suggest that the Hyde application for attorneys’ fees and costs was not timely under Amendment meant to allow a party merely to point to 28 U.S.C. § 2412(d)(1)(B), which requires that the application § 2412(b) to circumvent the requirements enumerated in for fees and other expenses be filed within thirty days of the § 2412(d). Indeed, § 2412(d) provides by far the most final judgment. Therefore, the court tolled the thirty-day concrete procedures and limitations in all of § 2412. Without limitation until June 9, 1998, because the government had the thirty-day rule and the requirements of “eligibility,” courts would be left directionless in trying to apply the Hyde 8 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 13 Electronic Communications Electronic Communications

concealed Brady materials in the FCC documents which were day limitation. In addition, as this is a waiver of sovereign not produced until March 30. immunity, some limitations must be applicable to the filing of a claim. The district court found the prosecution acted in bad faith in withholding Brady material from the defendant by failing Although one court reached the opposite conclusion, see to reveal to the defense the fact that Gouvion had lied to the Holland, 34 F. Supp.2d at 357-58 (“[h]ad Congress intended prosecution about the sale of the Rolex watch, which he used to limit an applicant’s rights to those granted by section as an excuse for the receipt of a wire money transfer that the 2412(d), it could have said so... [t]here is no reason to believe defendants claim was a pay-off from a competitor. The court the Hyde Amendment intended to confer lesser rights upon also found that the withholding of the FCC documents which criminal defendants than the EAJA conferred upon civil were requested under the FOIA was a violation of Brady. litigants”), this construction does not give effect to the plain meaning of the Hyde Amendment nor the policy The court awarded Ranger $40,106.74 in attorneys’ fees considerations behind it. Moreover, the Holland court admits and expenses. In awarding attorneys’ fees, the court that “the only procedural requirement in the EAJA is found in concluded that Ranger was only entitled to recover fees section 2412(d), which requires that parties must submit their incurred after January 9, 1998, “the date on which the United application for fees within 30 days of final judgment in the States promised disclosure of Brady materials but failed to predicate action.” Id. at 358. There is no reason to believe make those disclosures.” that Congress did not intend this procedural requirement to apply to criminal cases via the Hyde Amendment. II. DISCUSSION Thus, Ranger did not timely file its application for A. Standard of Review attorneys’ fees with the district court, as its June 9, 1998, application was more than thirty days after the final judgment The Hyde Amendment provides that an award of attorneys’ in the case (the dismissal of Ranger on February 3, 1998) and fees “shall be granted pursuant to the procedures and more than thirty days after Ranger’s receipt of the FCC e- limitations (but not the burden of proof) provided for an mails on or about March 28 to April 2, 1998. Even if the date award under Title 28, U.S.C. § 2412,” the EAJA, to of the disclosure of the FOIA FCC documents was used as the prevailing parties in criminal cases. Pub. L. No. 105-119, 111 date from which Ranger must comply with the thirty-day Stat. 2440, 2519 (1997) (reprinted in 18 U.S.C. § 3006A, limitation of the EAJA, the attorneys’ fees application was historical and statutory notes). Under the EAJA, an award or required to be filed at the latest on May 2, 1998. As the denial of attorneys’ fees is reviewed for an abuse of application was not filed until June 9, 1998, the district court discretion. See Pierce v. Underwood, 487 U.S. 552 (1988); lacked jurisdiction over Ranger’s application. Damron v. Commissioner of Social Security, 104 F.3d 853, 854 (6th Cir. 1997). The district court appeared to rely on REVERSED. sections 2412(b) and 2412(d) of the EAJA in determining whether Ranger had timely filed its application for fees. However, this court has ruled that the thirty-day EAJA time limit found in section 2412(d)(1)(B) is jurisdictional and cannot be waived. See Peters v. Secretary of Health and 12 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 9 Electronic Communications Electronic Communications

especially fatal to claims for attorney fees in criminal actions Human Serv., 934 F.2d 693 (6th Cir. 1991). In addition, this because the EAJA waiver of sovereign immunity as to other court reasoned: fee statutes and under the common law applies only to civil and not criminal actions. See 28 U.S.C. § 2412(b).” Ranger The thirty day time limitation contained in the EAJA is Electronic Communications, Inc., 22 F. Supp.2d at 674. The not simply a statute of limitations. It is a jurisdictional court dismissed with prejudice the charges against Peng and prerequisite to governmental liability.... The Equal Ranger on February 3, 1998; Ranger received the FCC e- Access to Justice Act significantly abridged the mails on or about March 30, 1998; and Ranger filed its government’s immunity from suits for attorneys’ fees. motion for attorneys’ fees on June 9, 1998. It decided: As a waiver of sovereign immunity, the act must be strictly construed. Once the government agrees to allow In order to give effect to Congress’s purpose and words such suits, “the terms of its consent to be sued in any in awarding attorneys’ fees in criminal cases involving court define that court’s jurisdiction to entertain that “bad faith” where the United States conceals its bad faith suit.” Courts have consistently held that a statutory time until more than 30 days after entry of judgment, a further limit is an integral condition of the sovereign’s consent. reasonable time period should be permitted for the filing Compliance with that condition is a prerequisite to of an application for attorney fees.... [T]he defendant jurisdiction. was permitted under the statute a reasonable period of time to discover the Brady violation from the documents Allen v. Secretary of Health & Human Services, 781 F.2d 92, and to file its application for attorney fees under the 94 (6th Cir. 1986) (internal quotation cite omitted). Thus, the EAJA. The Court determines that, as such, the EAJA time limit in section 2412(d) is jurisdictional, and application was timely filed. rulings applying such limit are reviewed de novo by this court. See United States v. Lindert, 1998 WL 180519, at **3 (6th Id. at 675. In the opinion granting the Hyde award to Ranger, Cir. April 8, 1998) (unpublished opinion); Brown v. Sullivan, the district court found that Ranger was a “prevailing party” 916 F.2d 492, 494 (9th Cir. 1990) (issues concerning the within the meaning of section 2412(d)(2)(B). See id. at 676. proper interpretation of the EAJA are reviewed de novo). In its second opinion specifically granting $40,106.74 to Ranger, the district court cited section 2412(b) as the B. The Hyde Amendment applicable section for bad faith conduct and the section under which it was awarding fees. The Hyde Amendment provides that attorneys’ fees may be awarded to a prevailing criminal defendant where “the court We believe the correct interpretation of the procedures and finds that the position of the United States was vexatious, limitations of the EAJA as incorporated in the Hyde frivolous, or in bad faith, unless the court finds that special Amendment includes the limitations of section 2412(d). circumstances make such an award unjust.” Pub. L. No. 105- Section 2412(b) directs the applicant to look for an 109, 111 Stat. 2440, 2519 (1997) (reprinted in 18 U.S.C. independent statute which gives a remedy of attorneys’ fees § 3006A, historical and statutory notes).7 Thus, a successful and expenses independent of the EAJA. As the Hyde Amendment incorporates the EAJA, it would be circular to go back to the Hyde Amendment to treat it as an independent 7 In his original proposal, Representative Hyde simply extended the statute giving the right to attorneys’ fees without the thirty- EAJA’s standard for awards and the allocation of the burden of proof to successful federal criminal defendants. Thus, Hyde’s version would have 10 United States v. Ranger Nos. 98-2255/2322 Nos. 98-2255/2322 United States v. Ranger 11 Electronic Communications Electronic Communications

criminal defendant must show that the government’s position Some conclude that the procedures and limitations of the was “vexatious, frivolous, or in bad faith” and even then may EAJA are contained in 28 U.S.C. § 2412(d). See United not recover if there are special circumstances which make the States v. Peterson, 71 F. Supp.2d 695, 698 (S.D. Tex. 1999); award of fees unjust. As a threshold matter, a successful United States v. Gardner, 23 F. Supp.2d 1283, 1289 (N.D. criminal defendant must comply with the “procedures and Okla. 1998). Section 2412(d) requires a party seeking an limitations” of the EAJA to ensure that his application is award to file a detailed application within thirty days of “final timely and properly filed. judgment.” “Final judgment” is defined as a judgment that is “final and appealable, and includes an order of settlement.” One of the limiting provisions of the EAJA provides that 28 U.S.C. §§ 2412(d)(1)(B) and (d)(2)(G). In its application, claims for attorneys’ fees must be filed within thirty days of the party must show that it is the “prevailing party”and state a final judgment from which there is no appeal. See 28 the actual time expended and the rates at which fees and other U.S.C. §§ 2412(d)(1)(B) and (d)(2)(G) (1994). The expenses were calculated. § 2412(d)(1)(B). No award of defendants failed to file within this period of time. They attorneys’ fees can be made in excess of $125 per hour unless argue this delay was due to the government’s underlying the court finds that special factors are present. See failure to disclose materials, and they further argue that the § 2412(d)(2)(A). Finally, section 2412(d) defines a “party” as Hyde Amendment permits a party to seek attorneys’ fees and a corporation that, at the time the civil action was filed, had costs under section 2412(b) of the EAJA without satisfying a net worth which did not exceed $7,000,000 and no more the requirements of section 2412(d). than 500 employees. See § 2412(d)(2)(B). No circuit has yet determined the Hyde Amendment’s Another district court, however, has held that the incorporation of the procedures and limitations of the EAJA.8 procedural limitations set forth in section 2412(d) of the The district courts that have addressed this issue are split. EAJA are not applicable if the prevailing party chooses to seek attorneys’ fees under section (b) in applying for fees under the Hyde Amendment. See United States v. Holland, permitted recovery of attorneys’ fees and costs to any prevailing criminal 34 F. Supp.2d 346, 358-59 (E.D. Va. 1999). Section 2412(b) defendant, unless the government showed that its position in the of the EAJA provides for recovery of attorneys’ fees and prosecution had been “substantially justified.” Additionally, the original expenses by a prevailing party in any civil action brought by version did not contain the language referring to disclosure and in camera review of evidence relevant to a Hyde Amendment claim. See 143 Cong. or against the United States “to the same extent that any other Rec. H7791 (daily ed. Sept. 24, 1997); 28 U.S.C. § 2412. party would be liable under the common law or under the terms of any statute which specifically provides for such an 8 award.” Section 2412(b) does not require a statutory filing The only circuit opinions issued thus far construe the time for appeal and whether the government’s position was “vexatious, frivolous, or in deadline, specify requirements as to the contents of the fee bad faith.” The Tenth Circuit, in United States v. Robbins, 179 F.3d application, limit the hourly rate permitted an attorney, nor 1268, 1270 (10th Cir. 1999), concluded that Fed. R. App. P. 4(b) applies provide a net worth ceiling that, if exceeded, disqualifies a and requires parties to “file a notice of appeal within the 10 days after the prevailing party from eligibility for a fee award. order appealed from is entered.” Most recently, the Eleventh Circuit held that a criminal defendant was not eligible for a Hyde award based on the government’s alleged withholding of exculpatory information from the In this case, Ranger moved for an award under the Hyde grand jury where “the trial jury convicts with knowledge of that Amendment without reference to the EAJA. The district evidence.” United States v. Gilbert, 198 F.3d 1293, 1304 (11th Cir. court determined that “[the] jurisdictional limitation is 1999).