Summary of a Recent
Judicial Development in
Alternative Dispute Resolution

Successful and Unsuccessful Claims Must Be "Interrelated"
to Recover Attorney Fees for Unsuccessful Claims

Walt McCarter
National AgLaw Center Research Associate

Summary of Decision

In Pigford v. Vilsack, 613 F. Supp. 2d 78, 2009 WL 1307959 (D.D.C. 2009), the United States District Court for the District of Columbia held that a plaintiff farmer's unsuccessful claims were not sufficiently related to his successful claims to merit attorney fees and expenses for the unsuccessful claims under the Equal Access to Justice Act and Equal Opportunity Credit Act.

Background

The plaintiff farmer instituted an arbitration action against the U.S. Department of Agriculture (USDA) relating to discrimination in its servicing of farm loans on various occasions between 1985 and 1994. Id. at *1. The arbitrator treated the plaintiff's allegations as eleven discrete claims, and ruled in the plaintiff's favor on some, but not all, of the claims. Id. The plaintiff was awarded $202,290 in actual damages and $100,000 in emotional distress damages, and his outstanding loan balances were forgiven. Id. The plaintiff's counsel brought this action to recover attorney fees, costs and expenses pursuant to the Equal Credit Opportunity Act (ECOA), 15 U.S.C. § 1691e(d), and the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412, and the USDA objected to part of the fees sought. Id.

Arguments

The USDA argued that the attorney fees should be reduced because the plaintiff's unsuccessful claims were unrelated to his successful claims, so the fees arising from those claims were not compensable. Id.

The plaintiff's counsel argued that the unsuccessful claims were legally related to his successful claims because all of the claims were based on the same legal argument that the USDA's actions were motivated by racial discrimination in violation of the ECOA. Id. at *4.

Analysis and Holdings

The court explained that unrelated unsuccessful claims should not be compensated under the EAJA or the ECOA, but rather should "be treated as if they had been raised in separate lawsuits." Id. at *2. The issue was whether the plaintiff's successful and unsuccessful claims were sufficiently "interrelated" to merit an award of attorney fees for all the claims. Id. "According to the D.C. Circuit, unsuccessful claims are unrelated to successful claims when the unsuccessful claims are 'distinctly different' in all respects, both legal and factual, from the successful claims." Id. at *3 (quoting Morgan v. District of Columbia, 824 F.2d 1049, 1066 (D.C. Cir.1987)). Generally, interrelated claims "cannot be viewed as a series of discrete claims." Id. (quoting George Hyman Constr. Co. v. Brooks, 963 F.2d 1532, 1539 (D.C. Cir. 1992)).

It was undisputed that the plaintiff's unsuccessful claims were factually distinct from his successful claims, and the court rejected plaintiff's counsel's argument that the claims were interrelated merely because they invoked the same legal authority. Id. at *4. The court found that the successful and unsuccessful claims could easily be viewed as a series of discrete claims, and therefore should be regarded as unrelated. Id. The court reasoned that plaintiff's counsel's theory was overly broad and would lead to unacceptable results; for instance, because Track B adjudications were limited to ECOA discrimination claims, all claims in Track B arbitrations would be "interrelated" under his theory, and furthermore it would allow a prevailing party to recover fees for any number of groundless claims as well as successful claims so long as they were asserted under the same legal authority. Id. at *5. The court therefore held that the plaintiff's unsuccessful claims were unrelated to his successful claims, and ordered the parties to attempt to settle the matter accordingly. Id. at *5-6.

The case was decided on May 12, 2009.