In the Matter of Luz Solla, Respondent,v.Elizabeth Berlin, Appellant, et al., Respondents.

Brief

N.Y.January 15, 2015

Supreme Court, New York County, Index No. 401178/2011 State of New York Court of Appeals In the Matter of the Application of LUZ SOLLA, Petitioner-Respondent, For a Judgment Pursuant to Article 78 of the Civil Practice Law & Rules v. ELIZABETH BERLIN, as Executive Deputy Commissioner of the New York State Office of Temporary and Disability Assistance, Respondent-Appellant, ROBERT DOAR, as Commissioner of the New York City Human Resources Administration, and JACQUELINE DUDLEY, as Deputy Commissioner of the New York City HIV/AIDS Services Administration, Respondents. REPLY BRIEF FOR APPELLANT BARBARA D. UNDERWOOD Solicitor General CECELIA C. CHANG Special Counsel WON S. SHIN Assistant Solicitor General of Counsel HAILEY A. BAIR Law Student Intern ERIC T. SCHNEIDERMAN Attorney General of the State of New York Attorney for Appellant 120 Broadway New York, New York 10271 (212) 416-8808 (212) 416-8962 (facsimile) Dated: June 24, 2014 No. APL-2013-00224 i TABLE OF CONTENTS Page TABLE OF AUTHORITIES ............................................................ iii PRELIMINARY STATEMENT ........................................................ 1 ARGUMENT ................................................................................... 3 POINT I - THE LEGISLATURE DID NOT AUTHORIZE CATALYST FEES UNDER THE NEW YORK EQUAL ACCESS TO JUSTICE ACT ....................... 3 A. The Text, History, and Purposes of the Act Establish that the Legislature Did Not Authorize Catalyst-Fee Awards. .......................... 3 B. Petitioner’s Arguments in Support of Catalyst Fees Require Rewriting the Act. ........... 6 1. C.P.L.R. 8600 does not authorize catalyst fees. .................................................... 6 2. Differences in the scope of the New York EAJA and the federal EAJA do not implicitly authorize catalyst fees. ................. 13 3. The catalyst theory upsets the New York EAJA’s careful calibration of purposes. ........ 18 C. Out-of-State Decisions Recognizing the Catalyst Theory Are Inapposite Because They Concern Statutes with Different Text, History, Purposes, and Background Law. ......... 22 D. The Legislature Is Free to Explicitly Enact the Catalyst Theory into the New York EAJA, but It Has Repeatedly Declined to Do So. .................................................................. 26 ii TABLE OF CONTENTS (cont'd) Page POINT II - THE CATALYST THEORY DOES NOT APPLY WHEN THE LAWSUIT DOES NOT CHANGE THE STATE’S POSITION ..................... 29 CONCLUSION ............................................................................... 34 iii TABLE OF AUTHORITIES Cases Page(s) Alaska Rent-A-Car, Inc. v. Avis Budget Group, Inc., 738 F.3d 960 (9th Cir.), cert. denied, 134 S. Ct. 644 (2013) ............................................. 25 Albunio v. City of N.Y., 2014 N.Y. Slip Op. 02325 (Apr. 3, 2014) ................................... 12 Am. Transit Ins. Co. v. Sartor, 3 N.Y.3d 71 (2004) ..................................................................... 11 Barrett v. United States, 423 U.S. 212 (1976) .................................................................... 11 Bluewater Network v. EPA, 370 F.3d 1 (D.C. Cir. 2004) ........................................................ 10 Bob Jones Univ. v. United States, 461 U.S. 574 (1983) .................................................................... 28 Bowsher v. Merck & Co., 460 U.S. 824 (1983) .................................................................... 28 Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health & Human Res., 532 U.S. 598 (2001) ...................................................... 1, 4, 17, 23 Calderon-Cardona v. JPMorgan Chase Bank, N.A., 867 F. Supp. 2d 389 (S.D.N.Y. 2011) ......................................... 11 CDR Creances S.A.S. v. Cohen, 2014 N.Y. Slip Op. 03294 (May 8, 2014) ................................... 12 Citizens Coal. for Block Grant Compliance, Inc. v. City of Euclid, 717 F.2d 964 (6th Cir. 1983) ...................................................... 31 iv TABLE OF AUTHORITIES (cont’d) Cases Page(s) Costello v. INS, 376 U.S. 120 (1964) .................................................................... 10 Cruz v. TD Bank, N.A., 22 N.Y.3d 61 (2013) ....................................................... 15, 16, 18 CWM Chem. Servs., L.L.C. v. Roth, 6 N.Y.3d 410 (2006) ................................................................... 18 DeSalvo v. Bryant, 42 P.3d 525 (Alaska 2002) ......................................................... 23 Dir., Office of Workers’ Comp. Programs v. Newport News Shipbuilding & Dry Dock Co., 514 U.S. 122 (1995) .................................................................... 20 Engle v. Talarico, 33 N.Y.2d 237 (1973) ................................................................. 28 Flemming v. Barnwell Nursing Home & Health Facilities, Inc., 15 N.Y.3d 375 (2010) ................................................................. 17 Fogerty v. Fantasy, Inc., 510 U.S. 517 (1994) .............................................................. 17, 20 Gottlieb v. Kenneth D. Laub & Co., 82 N.Y.2d 457 (1993) ................................................................. 17 Graham v. DaimlerChrysler Corp., 34 Cal. 4th 553 (2004) .................................................... 22, 23, 25 Heeren v. City of Jamestown, 39 F.3d 628 (6th Cir. 1994) ........................................................ 30 In re Nalle Plastics Family L.P., 406 S.W.3d 168 (Tex. 2013) ....................................................... 24 v TABLE OF AUTHORITIES (cont’d) Cases Page(s) Kimmel v. State, 115 A.D.3d 1323 (4th Dep’t 2014) ............................................. 13 Kucana v. Holder, 558 U.S. 233 (2010) .................................................................... 22 Ma v. Chertoff, 547 F.3d 342 (2d Cir. 2008) ......................................................... 8 Mansell v. Mansell, 490 U.S. 581 (1989) .................................................................... 19 Mason v. City of Hoboken, 196 N.J. 51 (2008) ................................................................ 22, 25 Matter of Auguste v. Hammons, 285 A.D.2d 417 (1st Dep’t 2001) ................................................ 12 Matter of Bliss v. Bliss, 66 N.Y.2d 382 (1985) ................................................................. 29 Matter of Chem. Specialties Mfrs. Ass’n v. Jorling, 85 N.Y.2d 382 (1995) ................................................................. 11 Matter of Cintron v. Calogero, 99 A.D.3d 456 (1st Dep’t 2012), lv. denied, 22 N.Y.3d 855 (2013) ................................................ 13 Matter of N.Y. State Clinical Lab Ass’n v. Kaladjian, 85 N.Y.2d 346 (1995) ................................................................. 33 Matter of Riley v. Dowling, 221 A.D.2d 446 (2d Dep’t 1995) ................................................. 13 Matter of Scott v. Coleman, 20 A.D.3d 631 (3d Dep’t 2005) ................................................... 13 vi TABLE OF AUTHORITIES (cont’d) Cases Page(s) Matter of Thomasel v. Perales, 78 N.Y.2d 561 (1991) ................................................................. 31 Matter of Wittlinger v. Wing, 289 A.D.2d 171 (1st Dep’t 2001), aff’d, 99 N.Y.2d 425 (2003) ........................................................ 12 Matter of Wittlinger v. Wing, 99 N.Y.2d 425 (2003) ................................................................. 32 McNeill v. United States, 131 S. Ct. 2218 (2011) ................................................................ 10 N. Bergen Rex Transp. v. Trailer Leasing Co., 158 N.J. 561 (1999) .................................................................... 24 Nat’l R.R. Passenger Corp. v. Nat’l Ass’n of R.R. Passengers, 414 U.S. 453 (1974) .................................................................... 15 Norfolk S. Ry. Co. v. Sorrell, 549 U.S. 158 (2007) .................................................................... 20 Omaha Tribe of Neb. v. Swanson, 736 F.2d 1218 (8th Cir. 1984) .................................................... 30 People v. Greenberg, 21 N.Y.3d 439 (2013) ................................................................. 32 Richardson v. Miller, 279 F.3d 1 (1st Cir. 2002) .......................................................... 24 Rodriguez v. United States, 480 U.S. 522 (1987) .............................................................. 19, 20 Ruckelshaus v. Sierra Club, 463 U.S. 680 (1983) .................................................................... 17 vii TABLE OF AUTHORITIES (cont’d) Cases Page(s) Scarborough v. United States, 431 U.S. 563 (1977) ...................................................................... 9 Settlemire v. Dist. of Columbia Office of Employee Appeals, 898 A.2d 902 (D.C. 2006) ........................................................... 24 Solebury Township v. Dep’t of Envtl. Prot., 593 Pa. 146 (2007) ..................................................................... 23 State Bd. of Educ. v. Waldrop, 840 So. 2d 893 (Ala. 2002) ......................................................... 24 State Farm Mut. Auto. Ins. Co. v. Langan, 16 N.Y.3d 349 (2011) ................................................................. 32 Tibbetts v. Sight ’n Sound Appliance Ctrs., Inc., 2003 Okla. 72 (2003) .................................................................. 24 W. Va. Univ. Hosps., Inc. v. Casey, 499 U.S. 83 (1991) ...................................................................... 21 Warren v. Colvin, 744 F.3d 841 (2d Cir. 2014) ....................................................... 27 Watson v. United States, 552 U.S. 74 (2007) ...................................................................... 27 Wells, Waters & Gases v. Air Prods. & Chems., 19 F.3d 157 (4th Cir. 1994) ........................................................ 10 Westside Cmty. for Indep. Living, Inc. v. Obledo, 33 Cal. 3d 348 (1983) ................................................................. 24 Yakutat v. Ryman, 654 P.2d 785 (Alaska 1982) .................................................. 24-25 viii TABLE OF AUTHORITIES (cont’d) State Laws Page(s) Alaska Stat. § 09.60.010 ................................................................. 25 C.P.L.R. 8600 .............................................................................................. 6 8601 ............................................................................................ 32 8602 ............................................................................................ 18 Cal. Code of Civ. P. § 1021.5 .......................................................... 23 Federal Laws 5 U.S.C. § 552 ................................................................................. 27 42 U.S.C. § 1988 ............................................................................. 21 Rules Alaska R. Civ. P. 82 ........................................................................ 26 Miscellaneous Authorities Assembly Mem. in Support of A. 7395, 232d Sess. (2009) ............ 28 Bryan A. Garner, Garner’s Modern American Usage 803 (3d ed. 2009) ............................................................................... 10 Senate Mem. in Support of S. 4534, 232d Sess. (2009) ................. 28 PRELIMINARY STATEMENT This appeal concerns the meaning of the term “prevailing party” in the New York State Equal Access to Justice Act (the New York EAJA or the Act)—specifically, whether a plaintiff or petitioner who fails to obtain court-ordered relief is a “prevailing party” eligible for an award of attorney’s fees under the so-called catalyst theory of fee-recovery. In 2001, the U.S. Supreme Court definitively rejected the catalyst doctrine under federal prevailing- party fee statutes. See Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of Health & Human Res., 532 U.S. 598 (2001). And for over a decade after Buckhannon, New York courts uniformly held that catalyst fees are not available under the New York EAJA. A divided panel of the Appellate Division, First Department, departed from settled precedent in this case and held that even though petitioner failed to obtain a court ruling in her favor, she is eligible for an award of fees because she purportedly catalyzed a change in the State’s position. As the State explained in its opening brief, that decision should be reversed for two independent reasons. First, the text, history, and purposes of the 2 New York EAJA all refute the claim that the Legislature intended to authorize catalyst fees against the State. Petitioner’s arguments to the contrary have no merit because they require rewriting, rather than interpreting, the statute—and focusing solely on one statutory purpose to the exclusion of other policies the Legislature balanced in the Act. Second, even if the Legislature meant to incorporate now- repudiated federal law on catalyst fees into the New York EAJA, petitioner fails to satisfy the requirements for catalyst-fee recovery under prior federal case law. Petitioner’s lawsuit did not cause any change in the State’s position with respect to her right to the restoration of benefits erroneously reduced by the City. Rather, since before the filing of petitioner’s C.P.L.R. article 78 petition, the State agreed that she was entitled to benefits and ordered the City to restore her benefits. Thus, petitioner’s lawsuit did not catalyze any change in the State’s position. 3 ARGUMENT POINT I THE LEGISLATURE DID NOT AUTHORIZE CATALYST FEES UNDER THE NEW YORK EQUAL ACCESS TO JUSTICE ACT A. The Text, History, and Purposes of the Act Establish that the Legislature Did Not Authorize Catalyst-Fee Awards. The key question in this case is whether the Legislature authorized so-called catalyst-fee awards under the New York EAJA. As the State established in its opening brief (Br. for Appellant [“App. Br.”] at 28-34), the text and history of the statute demonstrate that the Legislature did not authorize recovery of fees by parties who fail to obtain court-ordered relief. As petitioner acknowledges (Br. for Respondent [“Resp. Br.”] at 29), governing canons of statutory construction mandate that fee statutes be strictly construed. See App. Br. at 5, 37-40 (explaining canons). The Legislature enacted the New York EAJA against the backdrop of those longstanding interpretive principles. As a result, the absence of any clear, affirmative language authorizing awards of catalyst fees is dispositive and mandates reversal of the First Department majority’s contrary decision. 4 The following is undisputed: 1. The phrase “prevailing party” is a term of art that for centuries under settled New York law has had a single, uniform meaning: a party who has obtained court-ordered relief. App. Br. at 28-34. This long-settled definition rules out the award of fees on a catalyst-only theory. See Buckhannon, 532 U.S. at 603. And no New York court recognized the catalyst theory under New York law prior to passage of the Act in 1989. App. Br. at 32-33. 2. The Legislature limited fee recovery under the Act only to a “prevailing party.” The Legislature did not explicitly refer to the “catalyst theory” or “catalyst fees” or otherwise expressly provide for the award of fees to a party who has failed to obtain judicial relief—even though such theories of alternate fee-recovery were recognized under federal law at the time. App. Br. at 33-34. 3. Even if courts were permitted to base fee-recovery on a theory supported only by legislative history and not by the enacted statutory text, the history of the Act provides no support for inferring any legislative intent to authorize catalyst-fee awards. Although the legislative history shows concerns for other issues, 5 there is no mention of catalyst fees anywhere in the legislative record. Nor is there any statement in that history indicating that the Legislature meant to deviate from the settled meaning of “prevailing party” by expanding the class of persons traditionally eligible for attorney’s fees. App. Br. at 35-37. 4. The Legislature and the Governor had multiple goals in enacting the New York EAJA: not only to help litigants secure counsel for suits challenging unjustified state action, but also to limit the State’s fee liability and to avoid deterring state agencies from pursuing legitimate goals. App. Br. at 52-57; Resp. Br. at 37. 5. For over a decade, since the Supreme Court’s decision in Buckhannon, New York courts uniformly rejected catalyst-fee awards under the Act. App. Br. at 15-16. The Legislature has repeatedly considered and rejected bills to amend the Act to authorize catalyst fees. App. Br. at 17-18, 60; Resp. Br. at 41-42. Thus, all the accepted signs of legislative intent— background law, text, history, purposes, and subsequent legislative developments—point in the same direction: the Legislature did not intend to authorize catalyst fees under the Act. 6 B. Petitioner’s Arguments in Support of Catalyst Fees Require Rewriting the Act. 1. C.P.L.R. 8600 does not authorize catalyst fees. Petitioner argues (Resp. Br. at 30) that these traditional and, in this case, undisputed indicators of legislative intent are irrelevant and should be ignored. She instead bases her claim for catalyst-fee recovery principally on C.P.L.R. 8600, which declares it is the intent of the New York EAJA “to create a mechanism authorizing the recovery of counsel fees and other reasonable expenses in certain actions against the state of New York, similar to the provisions of [the federal EAJA] and the significant body of case law that has evolved thereunder” (emphasis added). According to petitioner, this general statement of intent indicates that the Legislature meant to incorporate “everything that is similar to the federal EAJA” into the Act “by reference,” Resp. Br. at 29 (emphasis added)—even the judge-made federal catalyst doctrine that is not explicitly mentioned in the actual text of the state statute. Moreover, petitioner asserts (Resp. Br. at 23, 30-32) that this broad incorporation by reference is limited to 7 federal law as it existed in 1989 when the New York EAJA was enacted, thus freezing into the Act outdated, subsequently repudiated federal law recognizing the catalyst theory. But as the State established in its opening brief, petitioner’s reading of C.P.L.R. 8600 fails on multiple grounds: First, it cannot be reconciled with the design of the statute confirmed by the legislative history. As even the First Department majority acknowledged, the Legislature did not intend the New York EAJA to follow its federal counterpart “for all purposes,” but rather “was focused on a narrow range of issues which it intended to be addressed consistently” with federal law (R. 160). The legislative history clearly shows that the Legislature was specifically concerned that the Act follow federal law regarding the substantial-justification standard, the availability of fee enhancements, and the compensability of fees incurred in administrative proceedings leading up to the litigation. App. Br. at 42-43. The legislative history does not, however, include any indication that the Legislature ever considered the federal 8 catalyst theory—let alone that it intended the New York EAJA to follow federal case law recognizing the theory. App. Br. at 35-37. Second, even if petitioner were correct that C.P.L.R. 8600 incorporates federal law on the meaning of “prevailing party,” neither the text of the provision nor the legislative history of the Act supports petitioner’s “frozen-in-time” reading. Rather, the Legislature directed courts to apply the Act in light of the “the significant body of case law that has evolved” under the federal EAJA—language that most naturally is read as incorporating evolving federal case law and ensuring parallel, non-divergent treatment of fee applications under state law. The Supreme Court in Buckhannon squarely rejected the catalyst theory as contrary to the proper interpretation of federal-fee shifting statutes that award fees only to “prevailing parties.” Since then, federal courts have uniformly held that catalyst fees are not available under the federal EAJA. See, e.g., Ma v. Chertoff, 547 F.3d 342, 344 (2d Cir. 2008) (per curiam) (collecting cases). Thus, even if the New York EAJA language were read broadly to incorporate federal law on prevailing-party status, 9 petitioner’s fee application would still fail under the literal terms of C.P.L.R. 8600. Decisions applying Buckhannon are part of “the significant body of case law that has evolved [under]” the federal EAJA. If the New York EAJA is indeed “similar to” decisions under the federal EAJA in every way, as petitioner suggests, the rule of Buckhannon rejecting catalyst fees would apply in this case and bar the award of fees. Nor does the legislative history support petitioner’s reading: nothing in that history suggests that the Legislature meant to disregard evolving case law under the federal EAJA, thus modeling the Act on increasingly outdated federal standards that existed only as of 1989. Petitioner attempts to avoid Buckhannon by noting the present-perfect verb tense of the phrase “has evolved” in C.P.L.R. 8600, which she claims incorporates federal case law only as it existed in 1989 and no subsequent developments thereafter. Resp. Br. at 22.1 But as petitioner acknowledges, the present-perfect 1 Verb tense is a thin reed on which to rest the claim for fees. Courts recognize that verb tenses used in legislation may “not [be] very revealing.” Scarborough v. United States, 431 U.S. 563, 571 (continued on next page) 10 tense can “come[] up to and touch[] the present.” Id. (quoting Dobrova v. Holder, 607 F.3d 297, 301 (2d Cir. 2010) (emphasis added; quotation marks omitted)). Thus, a grammatical reading of C.P.L.R. 8600 would not compel New York courts to look only to federal case law as it existed in 1989 in applying the Act. In order to read C.P.L.R. 8600 to avoid incorporating Buckhannon, this Court would have to rewrite the statute to use the past-perfect phrase “had evolved” rather than the present- perfect phrase “has evolved,” i.e., to make the Act similar to the federal EAJA and the significant body of case law that “had evolved thereunder as of the passage of the Act in 1989”—before Buckhannon. Indeed, petitioner uses the past-perfect phrase “had (1977); see McNeill v. United States, 131 S. Ct. 2218, 2222-23 (2011) (declining to interpret statute based on verb tense); Costello v. INS, 376 U.S. 120, 125 (1964) (verb tense not dispositive). The present-perfect tense in particular causes “confusion” among writers, Bryan A. Garner, Garner’s Modern American Usage 803 (3d ed. 2009), leading to statutory ambiguities, Bluewater Network v. EPA, 370 F.3d 1, 16 (D.C. Cir. 2004); Wells, Waters & Gases v. Air Prods. & Chems., 19 F.3d 157, 163 (4th Cir. 1994). In any event, as the following discussion demonstrates, the verb tense of the phrase “has evolved” in C.P.L.R. 8600 supports reading state law to follow Buckhannon, and not earlier federal law. 11 evolved” in her brief, again and again. Resp. Br. at 4, 21, 24, 28, 30, 33. But the Legislature did not enact those words, and “[a] court cannot amend a statute by adding words that are not there.” Am. Transit Ins. Co. v. Sartor, 3 N.Y.3d 71, 76 (2004). To do so would impermissibly “read into a statute a provision which the Legislature did not see fit to enact.” Matter of Chem. Specialties Mfrs. Ass’n v. Jorling, 85 N.Y.2d 382, 394 (1995).2 Third, petitioner’s reading would upend the long-settled practice in New York law of following evolving federal law on 2 Nor do the cases cited by petitioner (Resp. Br. at 22) support reading the phrase “has evolved” in C.P.L.R. 8600 to refer only to federal precedents decided prior to passage of the Act. For example, the federal felon-in-possession statute requires that the firearm “has been shipped or transported” in interstate commerce. Under petitioner’s theory, the statute’s use of the present-perfect tense means that the firearm must have traveled in interstate commerce prior to passage of the act. Yet the U.S. Supreme Court held that the requirement was satisfied where the firearm was shipped in interstate commerce in 1972—years after enactment of the statute in 1968. Barrett v. United States, 423 U.S. 212, 213-14, 216-17 (1976). Similarly, the Terrorism Risk Insurance Act of 2002 requires that the petitioner “has obtained a judgment,” and it was deemed satisfied where the judgment was obtained years later in 2010. Calderon-Cardona v. JPMorgan Chase Bank, N.A., 867 F. Supp. 2d 389, 393, 395 (S.D.N.Y. 2011). 12 attorney’s fees issues. As the State explained in its opening brief, this Court has interpreted New York fee statutes—including the New York EAJA itself—to follow federal decisions post-dating passage of the respective legislation. See App. Br. at 45-46 (citing Matter of N.Y. State Clinical Lab Ass’n v. Kaladjian, 85 N.Y.2d 346, 356-57 (1995); McGrath v. Toys “R” Us, Inc., 3 N.Y.3d 421, 433 (2004)). Indeed, in the last few months, this Court has continued that uncontroversial practice. Albunio v. City of N.Y., 2014 N.Y. Slip Op. 02325, at *6 (Apr. 3, 2014) (relying on post- enactment federal law as “useful guidance” in interpreting fee provision of the New York City Human Rights Law); see also CDR Creances S.A.S. v. Cohen, 2014 N.Y. Slip Op. 03294, at *10 (May 8, 2014) (citing 2011 federal decision supporting award of attorney’s fees as sanction for fraud on the court). Moreover, all four departments of the Appellate Division have frequently and consistently relied on federal precedent decided after 1989 in interpreting the New York EAJA. In addition to Matter of Auguste v. Hammons, 285 A.D.2d 417 (1st Dep’t 2001), and Matter of Wittlinger v. Wing, 289 A.D.2d 171 (1st Dep’t 2001), aff’d, 99 13 N.Y.2d 425 (2003), which followed Buckhannon in rejecting catalyst fees under the Act, see, for example, Kimmel v. State, 115 A.D.3d 1323, 1324 (4th Dep’t 2014); Matter of Cintron v. Calogero, 99 A.D.3d 456, 458 (1st Dep’t 2012), lv. denied, 22 N.Y.3d 855 (2013); Matter of Scott v. Coleman, 20 A.D.3d 631, 632 (3d Dep’t 2005); Matter of Riley v. Dowling, 221 A.D.2d 446, 447 (2d Dep’t 1995). All of these decisions, which address issues beyond potential catalyst fee awards, would have to be reconsidered under petitioner’s proffered reading of C.P.L.R. 8600 as incorporating federal case law only as it existed in 1989. Courts would have to substantially change their analysis of the full range of issues that arise in attorney’s fees claims under the New York EAJA and revise their analysis to incorporate federal case law only as it existed a quarter century ago. 2. Differences in the scope of the New York EAJA and the federal EAJA do not implicitly authorize catalyst fees. Petitioner also grounds her claim for catalyst fees in the purported design of the New York EAJA, pointing (Resp. Br. at 24-26) to the presence of certain textual differences between the 14 Act and the federal EAJA that limit the scope of the state statute relative to its federal counterpart.3 The First Department majority “presumed” from these differences that the Legislature “considered all of the ways in which it could have made the statute more restrictive than the federal law” and determined that these were the only “necessary” ones (R. 156 [emphasis added]). Adopting the same reasoning, petitioner argues that the Legislature’s failure to explicitly reject the catalyst theory means that it was implicitly adopted. Resp. Br. at 28 (“Because the catalyst theory was not one of the stated departures from the federal EAJA, the Legislature must have intended it to be part of the [New York] statute.”). Petitioner’s argument represents an improper use of the interpretive maxim expressio unius est exclusio alterius (to include one is to exclude another). As this Court has recently explained, 3 Unlike its federal analogue, the New York EAJA authorizes fees only to prevailing plaintiffs or petitioners and not to prevailing defendants; has lower net-worth and employee caps that make fewer parties eligible for fees; and defines “prevailing party” to require a higher threshold of success. See App. Br. at 7-9. 15 the expressio unius doctrine is used “not as a basis for recognizing unexpressed rights by negative implication” but rather “to limit the expansion of a right.” Cruz v. TD Bank, N.A., 22 N.Y.3d 61, 72 (2013) (emphasis added); see also Nat’l R.R. Passenger Corp. v. Nat’l Ass’n of R.R. Passengers, 414 U.S. 453, 458 (1974) (under expressio unius doctrine, “when legislation expressly provides a particular remedy or remedies, courts should not expand the coverage of the statute to subsume other remedies”). In Cruz, the statute at issue expressly granted banks a safe harbor for inadvertent failures to provide required forms, and the Court rejected the claim that banks were liable for all other failures to comply with the statute. The Legislature does not ordinarily use statutory “silence” to effect “significant alterations of existing law”; thus, if the Legislature had intended to impose new liability on banks, “it would have said so in the statute.” 22 N.Y.3d at 72. Petitioner’s theory mirrors the plaintiffs’ meritless argument in Cruz. She argues that by explicitly enumerating certain statutory limits on litigants’ right to obtain attorney’s fees from the State, the Legislature implicitly intended to create an expansive new right for 16 litigants to obtain fees without first securing any judicial relief. But the statute makes no mention of the catalyst theory or of awarding fees to parties who do not meet the traditional definition of “prevailing party.” As Cruz teaches, it would have been “odd” for the Legislature to create a new right to catalyst fees—and thereby to depart from settled New York law on prevailing-party status—by negative implication. See id. That result would be particularly anomalous given the narrow construction required by both the American Rule and the State’s sovereign immunity. See App. Br. at 5, 37-40. Petitioner argues (Resp. Br. at 29) that these interpretive canons are “not helpful” in construing the New York EAJA because “[t]he interpretive issue here involves the actual design of the statute.” But she cites no authority suggesting that the canons are inapplicable or applied with any less vigor to so-called “design” questions. Nor does she define what “design” questions are or offer any way to distinguish them from other interpretive questions. In any event, the American Rule and the sovereign- immunity canon clearly apply here. The catalyst-fee issue merely 17 asks what showing a plaintiff must make to merit an award of fees under the New York EAJA, or, put another way, what class of plaintiffs is eligible for fees under the Act. But courts routinely apply interpretive canons to narrowly construe statutes on questions of the standard for obtaining a fee award,4 as well as the class of litigants eligible for fees.5 And of course, the Supreme Court relied on the American Rule in answering the very question raised in this case—whether catalyst fees are available under a prevailing-party statute. Buckhannon, 532 U.S. at 608. Petitioner offers no persuasive reason why this case is different for purposes of applying interpretive canons. 4 See Fogerty v. Fantasy, Inc., 510 U.S. 517, 533-34 (1994) (rejecting automatic award of fees under the Copyright Act); Ruckelshaus v. Sierra Club, 463 U.S. 680, 684-86 (1983) (Clean Air Act requires claimant to show some degree of success on the merits rather than trivial or purely procedural success). 5 See Flemming v. Barnwell Nursing Home & Health Facilities, Inc., 15 N.Y.3d 375, 379 (2010) (objectors to class settlements not eligible for fees under C.P.L.R. 909); Gottlieb v. Kenneth D. Laub & Co., 82 N.Y.2d 457, 464-65 (1993) (only those asserting specified statutory claims eligible for fees under Labor Law § 198(1-a)). 18 Therefore, this Court should conclude that if the Legislature intended to adopt the catalyst theory, “it would have said so in the statute,” see Cruz, 22 N.Y.3d at 72, and that the Legislature’s silence may not be overridden by rewriting the Act to permit catalyst fees.6 3. The catalyst theory upsets the New York EAJA’s careful calibration of purposes. Petitioner also contends (Resp. Br. at 36, 37) that the catalyst theory is consistent with the New York EAJA’s “only” or “primary” purpose—to improve access to justice. But statutes often have multiple purposes, and competing ones at that. See, e.g., CWM Chem. Servs., L.L.C. v. Roth, 6 N.Y.3d 410, 423-24 (2006) (describing 6 Nor does the New York EAJA’s definition of “final judgment” as “a judgment that is final and not appealable, and settlement,” C.P.L.R. 8602(c), authorize catalyst fees. See Resp. Br. at 33-35. As the State explained in its opening brief (App. Br. at 50-51), the Legislature “do[es] not hide elephants in mouseholes,” Cruz, 22 N.Y.3d at 72 (quotation marks omitted), and it is thus unlikely that the Legislature would alter the traditional meaning of “prevailing party” through this procedural provision. Furthermore, petitioner does not fit the definition of “final judgment” in any event because she did not obtain a settlement. Petitioner claims (Resp. Br. at 34) that the Act “clearly envisions” fee awards for forms of nonjudicial relief other than settlements, but she offers no basis for that atextual assertion. 19 “competing purposes” of raising revenue, fostering environmentally sound waste disposal, and limiting burden on businesses); Mansell v. Mansell, 490 U.S. 581, 594 (1989) (describing “mixed purposes” to create new benefits for former spouses of military while also “plac[ing] limits” on those benefits to protect the retirees). Petitioner in fact acknowledges (Resp. Br. at 24-27, 37-38) that the Legislature designed the Act to also further the goals of limiting the State’s liability and avoiding deterrence of legitimate agency objectives through fee awards. Deciding which of multiple purposes to prioritize, and by how much, “is the very essence of legislative choice.” Rodriguez v. United States, 480 U.S. 522, 526 (1987) (per curiam). The First Department majority arrogated that legislative prerogative by impermissibly concluding that increasing access to justice is the only “laudatory” purpose of the statute (R. 166), even though the Legislature carefully and deliberately balanced multiple statutory policies in the Act. See Mansell, 490 U.S. at 594 (courts may not pick and choose among legislative purposes to “reach a sympathetic result”). 20 But even if the Court were to accept petitioner’s characterization that increasing access to justice is the “primary purpose” of the New York EAJA, it is overly “simplistic[] to assume that whatever furthers the statute’s primary objective must be the law.” Rodriguez, 480 U.S. at 526 (emphasis in original); accord Norfolk S. Ry. Co. v. Sorrell, 549 U.S. 158, 171 (2007) (“It does not follow . . . that th[e] remedial purpose [of the Federal Employers’ Liability Act] requires us to interpret every uncertainty in the Act in favor of employees.”). The Legislature intends a statute to achieve its purposes “by particular means,” and courts may not “add features that will achieve the statutory ‘purposes’ more effectively.” Dir., Office of Workers’ Comp. Programs v. Newport News Shipbuilding & Dry Dock Co., 514 U.S. 122, 136 (1995). Thus, fee statutes should not be interpreted in a “one-sided” fashion “simply [to] maximize[e]” the number of lawsuits in the name of statutory purpose. Fogerty, 510 U.S. at 525-26 (rejecting argument that Copyright Act fee provision should be interpreted to “encourage[] litigation of meritorious [infringement] claims”). For example, the U.S. Supreme Court rejected the argument that 21 expert fees should be included in attorney’s fees awards under the federal Civil Rights Attorney’s Fees Awards Act of 1976, 42 U.S.C. § 1988(b), because such recovery was thought necessary to achieve the remedial purpose of the statute and of the federal civil rights laws. The Court instead held that respecting Congress’ choice to use the phrase “attorney’s fees,” which had a settled meaning that did not include expert fees, was the best way to advance any statutory purposes: “the purpose of a statute includes not only what it sets out to change, but also what it resolves to leave alone.” W. Va. Univ. Hosps., Inc. v. Casey, 499 U.S. 83, 98 (1991). Here, too, the New York EAJA’s use of the phrase “prevailing party,” a legal term of art with a settled meaning encompassing only those parties who have obtained judicial relief, is one of the means by which the Legislature sought to achieve a careful calibration of purposes. Just as the Legislature limited the State’s potential fee liability by enacting low net-worth and employee caps, making defendants ineligible for fees, and creating a substantial-justification defense, see App. Br. at 7-8, it likewise narrowed the circumstances in which fees are available by using 22 the phrase “prevailing party” without expressly eliminating the traditional requirement of court-ordered relief. Petitioner may not surgically remove one of these important limits in the name of one of the several purposes the Legislature sought to balance. See Kucana v. Holder, 558 U.S. 233, 252 (2010) (“[T]he textual limitations upon a law’s scope are no less a part of its ‘purpose’ than its substantive authorizations.” (quotation marks omitted)). C. Out-of-State Decisions Recognizing the Catalyst Theory Are Inapposite Because They Concern Statutes with Different Text, History, Purposes, and Background Law. Petitioner urges (Resp. Br. at 32 n.3) this Court to follow decisions from three other States that have recognized the catalyst theory and declined to follow Buckhannon as a matter of state law. But in each of those cases, the court interpreted a specific state statute or rule that differs significantly from the New York EAJA in language, history, and purposes. See Mason v. City of Hoboken, 196 N.J. 51 (2008) (New Jersey Open Public Records Act); Graham v. DaimlerChrysler Corp., 34 Cal. 4th 553 23 (2004) (California Code of Civil Procedure); DeSalvo v. Bryant, 42 P.3d 525 (Alaska 2002) (Alaska Rule of Civil Procedure).7 For example, the California Code of Civil Procedure explicitly contemplates the award of fees if, among other requirements, an action “has resulted in the enforcement of an important right affecting the public interest” and “a significant benefit . . . has been conferred on the general public.” Cal. Code of Civ. P. § 1021.5. That language codifies a private attorney general policy that is consistent with the catalyst theory, see Graham, 34 Cal. 4th at 565-66; Buckhannon, 532 U.S. at 623, 635-36 (Ginsburg, J., dissenting), but the New York EAJA contains no comparable language. Out-of-state decisions concerning state fee-shifting statutes that differ from the New York EAJA in language, history, and purpose do not provide useful guidance here; if state courts 7 A fourth decision, cited only in petitioner’s table of authorities, is irrelevant because it did not involve a prevailing- party fee statute at all, but rather a fee provision that broadly authorizes the award of fees “in [the Board’s] discretion . . . in proceedings pursuant to this act.” Solebury Township v. Dep’t of Envtl. Prot., 593 Pa. 146, 159, 169-71 (2007). 24 interpreting those statutes adhere to a pre-Buckhannon catalyst theory, it does not follow that New York law does the same.8 Indeed, a careful examination of those decisions shows that they actually counsel against recognizing the catalyst theory here, because they rely heavily on jurisprudence specific to those States that runs contrary to New York law. Thus, the cases cited by petitioner highlight precisely what is missing in this case. For example, the highest court in each of those States had already recognized the catalyst theory as a matter of state law prior to Buckhannon, and thus simply adhered to that preexisting state law after Buckhannon. See, e.g., N. Bergen Rex Transp. v. Trailer Leasing Co., 158 N.J. 561, 570 (1999); Westside Cmty. for Indep. Living, Inc. v. Obledo, 33 Cal. 3d 348, 353 (1983); Yakutat 8 Several other States have followed Buckhannon to reject catalyst-fee awards under state fee statutes, further illustrating that the inquiry is statute-specific in each case. See In re Nalle Plastics Family L.P., 406 S.W.3d 168, 173 & n.6 (Tex. 2013); Settlemire v. Dist. of Columbia Office of Employee Appeals, 898 A.2d 902, 907 (D.C. 2006); Tibbetts v. Sight ’n Sound Appliance Ctrs., Inc., 2003 Okla. 72, ¶ 23 (2003); State Bd. of Educ. v. Waldrop, 840 So. 2d 893, 900 (Ala. 2002); Richardson v. Miller, 279 F.3d 1, 5 (1st Cir. 2002) (applying Massachusetts Law). 25 v. Ryman, 654 P.2d 785, 793 (Alaska 1982). But this Court has never previously recognized the catalyst theory as a matter of New York law. Indeed, we are aware of no decision from any New York court recognizing the catalyst theory under New York law prior to enactment of the New York EAJA in 1989 (App. Br. at 32-33), and petitioner has failed to identify any. Furthermore, each of those States declined to follow Buckhannon in part because existing state-law precedents called for interpreting state fee statutes more broadly than their federal counterparts. The California Supreme Court has repeatedly and “markedly diverged from United States Supreme Court precedent” to interpret state fee statutes more expansively than federal fee statutes. Graham, 34 Cal. 4th at 569. New Jersey likewise takes “a more indulgent view” of attorney’s fees than federal law does. Mason, 196 N.J. at 75 (quotation marks omitted). Alaska, meanwhile, is sui generis on fee issues because it is the only State in the Nation that has rejected the American Rule. Alaska Rent-A- Car, Inc. v. Avis Budget Group, Inc., 738 F.3d 960, 972 (9th Cir.), cert. denied, 134 S. Ct. 644 (2013); see Alaska Stat. § 09.60.010; 26 Alaska R. Civ. P. 82(a) (providing that ordinarily “the prevailing party in a civil case shall be awarded attorney’s fees”). Unlike courts in those States, this Court interprets New York fee statutes (including the New York EAJA) consistently with evolving federal law, see supra at 12-13, and follows the venerable American Rule, see App. Br. at 5, 37-38. This Court should follow Buckhannon as a matter of state law and hold that the New York EAJA does not permit the award of catalyst fees. D. The Legislature Is Free to Explicitly Enact the Catalyst Theory into the New York EAJA, but It Has Repeatedly Declined to Do So. The American Rule and the State’s sovereign immunity do not permit the award of attorney’s fees unless the Legislature clearly and explicitly indicates its intent to authorize the award in a fee-shifting statute. App. Br. at 5, 37-40. In the wake of Buckhannon, state and local legislatures throughout the country, including the New York City Council, have demonstrated that they 27 are capable of expressly enacting catalyst-fee provisions. App. Br. at 58-59.9 The New York State Legislature remains free to follow suit by amending the New York EAJA to clearly and expressly authorize catalyst fees, and it is the branch of government best suited to make that policy choice. App. Br. at 57-58. In fact, the Legislature has repeatedly considered such catalyst-fee amendments, but it has failed to enact them. App. Br. at 17-18. Petitioner asks this Court to ignore those developments, contending (Resp. Br. at 41-43) that the U.S. Supreme Court and this Court have “rejected” the use of such legislative inaction as evidence of legislative intent. But both courts in fact recognize that legislative acquiescence can confirm a statutory interpretation then in force. See, e.g., Watson v. United States, 552 U.S. 74, 82-83 (2007) (interpretation is “enhanced” by 9 In addition, Congress narrowly overruled Buckhannon as it had been applied to the Freedom of Information Act. E.g., Warren v. Colvin, 744 F.3d 841, 845 (2d Cir. 2014) (per curiam); see 5 U.S.C. § 552(a)(4)(E)(ii) (conferring prevailing-party status on a complainant who obtains relief through “a voluntary or unilateral change in position by the agency, if the complainant’s claim is not insubstantial”). 28 congressional acquiescence); Bowsher v. Merck & Co., 460 U.S. 824, 837 n.12 (1983) (congressional acquiescence is “instructive” in interpreting a statute); Engle v. Talarico, 33 N.Y.2d 237, 242 (1973) (acquiescence is “evidence of [the Legislature’s] intention”). Here, the proposed amendments came after the trio of decisions in Buckhannon, Matter of Auguste, and Matter of Wittlinger, and were intended to “mirror” other jurisdictions’ legislative responses to Buckhannon. Assembly Mem. in Support of A. 7395, 232d Sess. (2009); Senate Mem. in Support of S. 4534, 232d Sess. (2009). Because these proposals concerned “th[e] precise issue” raised in Matter of Auguste and Matter of Wittlinger—the availability of catalyst fees under the New York EAJA after Buckhannon—there is no reason to doubt that the Legislature was “acutely aware” of the issue. See Bob Jones Univ. v. United States, 461 U.S. 574, 599-601 (1983). Accordingly, the Legislature’s repeated failure to enact proposals specifically designed to overrule Matter of Auguste and Matter of Wittlinger is powerful evidence that those decisions were correct. See, e.g., id. at 601; Bowsher, 460 U.S. at 837 n.12 (“congressional rebuffs” of proposed 29 amendments are “instructive” in interpreting a statute); Matter of Bliss v. Bliss, 66 N.Y.2d 382, 389 (1985) (relying on “numerous unsuccessful attempts” to overrule existing statutory interpretation as confirmation of legislative intent). The New York EAJA has operated without permitting catalyst fees for over a decade—since Matter of Wittlinger and Matter of Auguste were decided in 2001. Unless and until the Legislature actually passes a catalyst-fee statute, this Court should interpret the Act in a manner consistent with its text, history, purposes, and the last decade of lower-court precedent—by rejecting the catalyst theory. POINT II THE CATALYST THEORY DOES NOT APPLY WHEN THE LAWSUIT DOES NOT CHANGE THE STATE’S POSITION Moreover, as the State established in its opening brief (App. Br. at 61-67), even if the Legislature had incorporated the catalyst theory into the New York EAJA, petitioner would not be entitled to fees. Decisions applying the catalyst theory under the federal EAJA hold that a plaintiff is not a prevailing party if her lawsuit 30 catalyzes a change in the position of a third party, and not the position of the federal government. See, e.g., Heeren v. City of Jamestown, 39 F.3d 628, 631 (6th Cir. 1994) (denying prevailing- party status where only the city, but not the federal agency, “changed its behavior in response to plaintiff’s lawsuit”); Omaha Tribe of Neb. v. Swanson, 736 F.2d 1218, 1221 (8th Cir. 1984) (no catalyst fees if the federal government already “sought [the third party’s] compliance” prior to filing of the suit). Under the rationale of those decisions, no change in the State’s position has been catalyzed in this case: the State has consistently sided with petitioner regarding the City’s erroneous reduction of her shelter allowance since before the commencement of this article 78 proceeding. Petitioner insists (Resp. Br. at 49) that her lawsuit changed the State’s position “from inaction to action.” But it is undisputed that prior to the lawsuit, the New York State Office of Temporary and Disability Assistance (OTDA) determined after a fair hearing that the New York City Human Resources Administration (HRA) had erroneously reduced petitioner’s benefits and directed HRA to retroactively restore the 31 benefits (R. 39-40). And there is likewise no dispute that OTDA also inquired with HRA when petitioner submitted a request for compliance and received a report that HRA had complied (R. 42).10 Petitioner’s argument thus amounts to a complaint that the State “moved more slowly than,” and “not as aggressively as,” she desired prior to the lawsuit—an insufficient basis for catalyst fees under federal law. Citizens Coal. for Block Grant Compliance, Inc. v. City of Euclid, 717 F.2d 964, 967 (6th Cir. 1983) (denying prevailing-party status under the federal EAJA). Though petitioner argues elsewhere that federal catalyst-theory case law was incorporated into the Act, see supra Point I.B.1, she fails to 10 Matter of Thomasel v. Perales, 78 N.Y.2d 561 (1991) (cited in Resp. Br. at 34), is not to the contrary. Matter of Thomasel imposed fee liability on the State for the City’s erroneous reduction of benefits, but it is distinguishable not only because it concerned fees under 42 U.S.C. § 1988 rather than the New York EAJA, but also because the State in that case signed a settlement suggesting that it shared responsibility with the City for making and correcting the error. Id. at 570. Furthermore, the rationale of Thomasel has already been eroded in the context of the New York EAJA by subsequent decisions holding that when the City delays compliance with state orders, the State’s position is considered substantially justified or a fee award is deemed unjust. See App. Br. at 66 n.13. 32 distinguish these unfavorable decisions—or even to acknowledge them—in her brief. Petitioner instead argues at length (Resp. Br. at 44-49) that the State’s position in this case was not “substantially justified” and that no “special circumstances make an award unjust,” C.P.L.R. 8601(a). But neither Supreme Court nor the First Department addressed these potentially fact-bound issues in this case, and this Court should not do so in the first instance. See, e.g., People v. Greenberg, 21 N.Y.3d 439, 448 (2013); State Farm Mut. Auto. Ins. Co. v. Langan, 16 N.Y.3d 349, 357 (2011). Thus, if this Court were to hold that catalyst fees are available under the New York EAJA, and that petitioner’s lawsuit catalyzed a change in the State’s position, it should decline to address substantial justification or special circumstances in this appeal. Because these questions “necessarily depend[] on the circumstances” of each case, Matter of Wittlinger v. Wing, 99 N.Y.2d 425, 432 (2003), the courts below should be permitted to address them on remand, 33 subject to deferential appellate review for abuse of discretion, Matter of N.Y. State Clinical Lab Ass’n, 85 N.Y.2d at 356.11 11 This Court should decline to address substantial justification or special circumstances for the additional reason that the State has not had an opportunity to fully litigate these issues. While petitioner argued below that the State’s position is not substantially justified and that no special circumstances make a fee award unjust, the State had no reason to engage these issues at the time because the controlling authority of Matter of Auguste and Matter of Wittlinger precluded catalyst fees. 34 CONCLUSION For the foregoing reasons, this Court should reverse the Appellate Division’s decision and order. Dated: New York, New York June 24, 2014 BARBARA D. UNDERWOOD Solicitor General CECELIA C. CHANG Special Counsel to the Solicitor General WON S. SHIN Assistant Solicitor General of Counsel HAILEY A. BAIR Law Student Intern Respectfully submitted, ERIC T. SCHNEIDERMAN Attorney General of the State of New York Attorney for Appellant By: ____________________________ WON S. SHIN Assistant Solicitor General 120 Broadway New York, NY 10271 (212) 416-8808 Reproduced on Recycled Paper