Rehearing En Banc Denied October 20, 1982.
ON REMAND FROM THE SUPREME COURT OF THE UNITED STATES
SAM D. JOHNSON, Circuit Judge:
On February 23, 1981, this Court reversed the district court and denied the Ku Klux Klan, Realm of Louisiana (KKK) an award of attorneys' fees against the Department of Health, Education and Welfare (HEW). Knights of K. K. K. v. East Baton Rouge Parish School Board, 643 F.2d 1034 (5th Cir. 1981). The basis of the denial was this Court's determination that the Civil Rights Attorneys' Fees Awards Act of 1976 did not allow recovery of attorneys' fees against the federal government. While the KKK's appeal was pending before the Supreme Court, the Equal Access to Justice Act (EAJA) went into effect. 5 U.S.C. § 504, 28 U.S.C. § 2412 (West.Supp.1981). Because the EAJA allows attorneys' fees awards to certain parties prevailing in actions against the federal government, the Supreme Court has now remanded this case, 454 U.S. 1075, 102 S.Ct. 626, 70 L.Ed.2d 609 for reconsideration in light of that Act.
I. Attorneys' Fees Awards Under the EAJA
Prior to implementation of the EAJA, 28 U.S.C. § 2412 barred an award of attorneys' fees to the prevailing party in any civil action brought by or against the United States government, unless specifically
This Court did not consider the applicability of the EAJA to the instant case because that Act did not become effective until October 1, 1981. The EAJA made significant changes in 28 U.S.C. § 2412. As amended, section 2412 still retains a general provision barring attorneys' fees and expenses against the federal government, except as otherwise specifically provided by statute. Sections 2412(b) and 2412(d), however, provide two broad statutory exceptions. The most significant change is the statutory exception in section 2412(d), which provides in pertinent part:
A party is only eligible for this mandatory fee award if it is a "prevailing" party and meets certain financial eligibility requirements set forth in section 2412(d)(2)(B):
Even if a prevailing party is not eligible for a mandatory attorneys' fee award, section 2412(b) permits a court in its discretion to award attorneys' fees and other expenses against the federal government to the same extent it may award fees in cases involving other parties.
II. Retroactive Application of the EAJA
The KKK was appealing this Court's denial of attorneys' fees when the EAJA became effective as law on October 1, 1981. At the outset, the question arises whether such an action on appeal is covered by the EAJA.
The implementation provision provides that the Act shall apply to any civil action that "is pending on, or commenced on or after" October 1, 1981. Section 208, 28 U.S.C. § 2412 (West Supp.1981).
III. Eligibility of the KKK
The KKK meets at least two other threshhold requirements of the EAJA. It is a "prevailing party" in civil litigation against an agency of the federal government. Second, the KKK's demand for injunctive relief under 42 U.S.C. § 1983 is clearly one kind of civil action in which fees may be awarded under section 2412. The mandatory award provision under section 2412(d) excludes tort actions, but the legislative history of the EAJA notes that constitutional torts are not considered a part of this exclusion. H.R.Rep.No. 96-1418, 96th Cong., 2d Sess. 18, reprinted in 1980 U.S.Code Cong. & Ad.News 4953, 4997. See also Matthews v. United States, 526 F.Supp. 993 (M.D.Ga.1981).
To qualify for a mandatory fee award under section 2412(d), the KKK faces two additional hurdles. First, it must demonstrate that it meets the financial eligibility requirement set forth in section 2412(d)(2)(B), which requires that the organization's net worth did not "exceed $5,000,000 at the time the civil action was filed ... [or that the organization had] not more than 500 employees at the time the civil action was filed."
Neither the Act nor the legislative history provides a conclusive answer as to whether the "position" for which substantial justification must be shown is the United States' litigation position or the United States' posture in its pre-trial actions. See Alspach v. District Director of Internal Revenue, 527 F.Supp. 225, 228 (D.Md.1981). The test of whether or not a government action is substantially justified is essentially one of reasonableness. H.R.Rep.No. 96-1418, 96th Cong., 2d Sess. 10-11, reprinted in 1980 U.S.Code Cong. & Ad.News at 4989. Where the Government can show that its position had a reasonable basis both in law and fact, no award will be made. This standard represents a middle ground between an automatic award of fees and a restrictive position which would have required the prevailing party to show that Government action was "arbitrary, frivolous, and groundless." 1980 U.S.Code Cong. & Ad.News at 4993. The "special circumstances" exception provides a safety valve for the Government when it is advancing in good faith a credible, though novel, rule of law. Id.
This Court does not have before it adequate facts to determine whether the KKK meets the financial limitation requirement or whether the Government was substantially justified in its position. Furthermore, the basic role of this Court is merely to review a fee award or denial of an award under the EAJA, modifying it only if the
This cause is therefore remanded to the district court to determine if the KKK qualifies under either the mandatory or discretionary provisions of the EAJA. IT IS HEREBY ORDERED that plaintiff submit an application for fees and other expenses to the district court within thirty days of the issuance of this mandate. See 28 U.S.C. § 2412(d)(1)(B).
The reconsideration of this Court's judgment in light of the EAJA does not affect this Court's prior determination that this cause should also be remanded to the district court to determine what amount, if any, of attorneys' fees reasonably may be assessed against the Board. Accordingly, this Court's remand for that purpose, as set forth in East Baton Rouge Parish, 643 F.2d at 1040-41, is reinstated.
643 F.2d at 1036.
S & H Riggers II at 428 n.3. See also Donovan v. Dillingham, 668 F.2d 1196, 1199 (11th Cir. 1982).