On March 16, the Federal Circuit issued its opinion in Monroe v. United States, an Equal Access to Justice Act case we have been following because it attracted an amicus brief. On appeal from the United States Court of Federal Claims, the United States asked the Federal Circuit to overrule what it characterized as an abuse of discretion by the trial court in ordering it to pay the plaintiff’s attorneys’ fees and expenses. Monroe, for his part, maintained he “prevailed at each procedural stage of the litigation” and, as result, “a fully compensatory fee award was warranted.” The National Veterans Legal Services Program filed an amicus brief in support of Monroe. The Federal Circuit, however, agreed with the government and reversed the Court of Federal Claims. This is our opinion summary.
Chief Judge Moore and Judges Clevenger and Chen heard the appeal, and Judge Clevenger authored the court’s unanimous opinion. He summarized the relevant background as follows:
Mr. Monroe began active duty service in the United States Air Force on February 16, 2000. In 2005, he was diagnosed with diabetes mellitus, type 1. In 2009, he became insulin dependent, and thereafter his medical condition was carefully monitored by the Air Force. . . . But on December 11, 2012, Mr. Monroe was evaluated again in another annual RILO, after which the examiner determined that Mr. Monroe was not eligible to return to duty. . . . On May 17, 2013, an Informal Physical Evaluation Board (“IPEB”) found Mr. Monroe’s diabetes condition to be an unfitting medical condition, in part because the condition limited possible deployments and recommended his discharge with severance pay and a 20 percent disability rating. Mr. Monroe disagreed with the recommendation and requested an appearance before a Formal Physical Evaluation Board (“FPEB”).
On July 16, 2013, Mr. Monroe’s requested FPEB found his diabetes to be an unfitting medical condition, reasoning that his diabetes was inconsistent with military service. . . . On November 12, 2013, the FPEB met again and confirmed the previous FPEB analysis and conclusion. Mr. Monroe disagreed with the FPEB discharge recommendation and, on November 23, 2013, requested his case be forwarded to the Secretary of the Air Force Personnel Council (“SAFPC”) for review. On January 23, 2014, the SAFPC denied Mr. Monroe’s appeal and directed his discharge with severance pay and a disability rating of 20 percent, due to the fact that Mr. Monroe’s diabetes “will permanently limit his ability to serve worldwide.” At Mr. Monroe’s request, the SAFPC agreed to reconsider its decision. On June 26, 2014, the SAFPC again denied his appeal and directed his discharge with severance pay and a disability rating of 20 percent, due to his inability to deploy worldwide. On November 14, 2014, Mr. Monroe pro se filed an application for correction of his military records with the Air Force Board for Correction of Military Records (the “Board”) and made an extensive submission of his arguments. He only sought reinstatement to active duty, on the ground that the Air Force erred in finding him unfit for duty and then unlawfully discharged him. . . . While Mr. Monroe’s application was pending, he was honorably discharged on January 22, 2015, with just under fifteen years of service. On September 22, 2017, the Board released its decision, described hereinafter as the 2017 Board decision. . . . As such, the Board denied Mr. Monroe his requested relief.
On July 19, 2018, Mr. Monroe through counsel, filed suit against the United States in the Claims Court, seeking review of the 2017 Board decision on the ground that the Board failed to correct legal error committed by the Air Force in the previous SAFPC decisions. . . . On January 15, 2020, the Board issued its second addendum decision, described hereinafter as the 2020 Board decision. Following the 2020 Board decision, Mr. Monroe moved to dismiss his complaint voluntarily, and the Claims Court granted his motion on February 6, 2020. Shortly thereafter, Mr. Monroe filed a motion for attorneys’ fees and expenses under EAJA. . . . After review of Mr. Monroe’s fee application, the government response, and Mr. Monroe’s rebuttal, the Claims Court ruled in Mr. Monroe’s favor, finding the government’s position not substantially justified and awarding Mr. Monroe $50,881.27 in attorneys’ fees and expenses. . . . The Claims Court’s decision was taken on the basis of the briefs describing the arguments made by the parties. As noted above, Mr. Monroe argued a lack of justification on the two grounds identified in his EAJA motion: alleged errors associated with the two remand orders and the error of not having increased Mr. Monroe’s 20 percent disability rating sooner in the Board review process.
The Federal Circuit began its analysis by noting that “the government initially disputed that Mr. Monroe is entitled to ‘prevailing party’ status, but the Claims Court disagreed, holding that Mr. Monroe is the prevailing party in this case,” and, on appeal, “[t]he government does not appeal this ruling by the Claims Court.” As a result, the court explained, the only issue for the court to decide “is whether the Claims Court erred in holding that the government failed to show that its position was substantially justified.”
Ultimately, the Federal Circuit concluded that “neither ground asserted by the Claims Court to find the government’s position not substantially justified is correct.” Indeed, the court explained, “[l]ooking back at this extended litigation and assessing the government’s position as a whole, there is but a single instance of agency error, which necessitated a second remand to determine if the 2019 Board decision had improperly relied on regulations that post-dated Mr. Monroe’s discharge.” The court, however, concluded that “that error proved to be harmless when the 2020 Board decision sustained the Air Force’s decision without reliance on the post-dated regulation.” Moreover, the Federal Circuit decided that Monroe’s “legal challenges in the Claims Court related solely to his claim to reinstatement to active duty, and virtually all of his (and the government’s) submissions to the three Boards dealt with the claim to reinstatement.” And, the court noted, “[o]nly at the end of the proceedings did Mr. Monroe request alternative relief, in the form of a higher disability rating, and the 2020 Board promptly granted the relief in the interests of justice, without objection from the Air Force.”
As a result, the court held, “the Claims Court abused its discretion in making its judgment call, due to its errors in faulting justification for the government’s overall position.” Accordingly, the Federal Circuit “reverse[d] the final decision of the Claims Court awarding attorneys’ fees and expenses to Mr. Monroe, and remand[ed] the case for dismissal of Mr. Monroe’s EAJA motion.”