# Reply Brief — Sullivan v. Finkelstein

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URL: https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0677%3A7

## Record

- **Collection:** Supreme Court brief
- **Document type:** Reply Brief
- **Published:** January 1, 1990
- **Citation:** 496 U.S. 617

## Text

Supreme Court, U.S. )
* FILED
7 APR 17 1998
No. 89-504 JOSEPH F. SPANIOL, JR,

In the Supreme Court of the United States

OCTOBER TERM, 1989

Louis W. SULLIVAN, SECRETARY
OF HEALTH AND HUMAN SERVICES, PETITIONER

* *

MARILYN FINKELSTEIN

ON WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

REPLY BRIEF FOR THE PETITIONER

KENNETH W. STARR
Solicitor General
Department of Justice
Washington, D.C. 20530
(202) 633-2217

EST AVAILABLE COP

.

om ee |

TABLE OF AUTHORITIES

Cases: Page
Abney v. United States, 431 U.S. 651 (19777 4,9
Brown Shoe Co. v. United States, 370 U.S. 294

1T—„—»„çß½. 6
Budinich v. Becton Dickinson & Co., 486 U.S. 196
EE 8, 9, 18
Cohen v. Beneficial Industrial Loan Corp., 337 U.S.
ES 3 3, 4, 7, 8, 9, 15
Cohen v. Perales, 412 F.2d 44 (5th Cir. 1969),
I 2, 15, 18
Coopers & Lybrand v. Livesay, 437 U.S. 4
. x . 6, 7-8
Cox Broadcasting Corp. v. Cohn, 420 US. 469
(1975) ........ ... et Ee 5

CSX Transportation, Inc. v. Brotherhood of Rail-
way Carmen, cert. granted, No. 89-1028 (Mar.

lacie arcane eens erteriennsinmnmnenmne 13
Dickinson v. Petroleum Conversion Corp., 338

TITS LTA ——— 5
Eisen v. Carlisle & Jacquelin, 417 U.S. 156

lla ES W̃-n 222 22 ———— 4. 5
FTC v. Standard Oil Co., 449 U.S. 232 (1980) 7
Forga v. Conrad, 47 U.S. (6 How.) 201 (1848) 6

Gulfstream Aerospace Corp. v. Mayacamas Corp.,

D x ——e 8
Harrington v. Haller, 111 U.S. 796 (1884) 5
Heckler v. Campbell, 461 U.S. 458 (1983 10
Huie v. Bowen, 788 F.2d 698 (11th Cir. 1986) 3
Midland Asphalt Corp. v. United States, 109 S. Ct.

ß x x —— 4
Mitchell v. Carlson, No. 89-1377 (5th Cir. Mar. 15,

EE a ᷑ . ——-ͤĩ—4 16
Mitchell v. Forsyth, 472 U.S. 511 (1985) 4,9
Moses H. Cone Memorial Hosp. v. Mercury Constr.

Corp., 460 U.S. 1 (1983)... 6,8

Newpark Shipbuilding & Repair, Ine. v. Round
tree, 723 F.2d 399 (5th Cir.), cert. denied, 469
ß 3

Cases—Continued : Page

Norfolk & Western Ry. v. American Train Dis-
patchers Ass'n, cert. granted, No. 89-1027 (Mar.
North Broward Hosp. Dist. v. Bowen, 808 F.2d
1405 (11th Cir. 1987), vacated, 485 U.S. 1018

. » 3
Occidental Petroleum Corp. v. SEC, 873 F.2d 325

Gl, 3 .. 2. 7, 17
Pickett v. Bowen, 833 F.2d 288 (11th Cir. 1987) 3
Richardson v. Perales, 402 U.S. 389 (19717 2
Sears, Roebuck & Co. v. Mackey, 351 U.S. 427

| | een 5
Seatrain Shipbuilding Corp. v. Shell Oil Co., 444

ee ge 7
Stack v. Boyle, 342 U.S. 1 (19817 4
Sullivan v. Hudson, 109 S. Ct. 2248 (19899 11, 17, 18
Taylor v. Heckler, 778 F.2d 674 (11th Cir. 1985) 3,15
Tiffany, Ex parte, 252 U.S. 32 (1920 5

United States v. MacDonald, 435 U.S. 850 (1978) 9
Waco v. United States Fidelity & Guaranty Co.,

Re eS OF) ee 16
Wilson v. Heckler, 609 F. Supp. 120 (W.D. Mo.
| ee —̃ x 11
Statutes and rule:
Hobbs Administrative Orders Review Act, 28
UE. SCR ED ß 13, 14
208. ( ͤ 13, 14
Equal Access to Justice Act, 28 U.S.C. 2412 11,17
Social Security Act, Tit. II. 42 U.S.C. 401 et seq.:
42 U.S.C. 405 (g)) 1, 3, 11, 12, 14, 15, 16, 17, 18
42 U.S.C. 423(d)(2)(B) (1982 & Supp. V
| ũ r 10
28 U.S.C. 128804 . —̃ — 14
II — 14
ll 2 ᷑ ]ĩð⁊ꝭͥ0½éẽ- 5
39 ..!üñ1ͤö — passim

ye Coe) | .—X(ĩ(ñçl:ů: 19

— —

III
Statutes and rule Continued: Page
r ̃ . ssesumesncnenssnacacs 16
r ̃ ... 5, 6

Miscellaneous:

P. Bator, D. Meltzer, P. Mishkin & D. Shapiro,
Hart & Wechsler’s The Federal Courts and the
Federal System (3d ed. 1988 5
55 Fed. Reg. 1012 (Jan. 11,1990) 19
H.R. Rep. No. 120, 99th Cong., Ist Sess. (1985) 18

In the Supreme Court of the United States

OCTOBER TERM, 1989

No. 89-504

Louis W. SULLIVAN, SECRETARY
OF HEALTH AND HUMAN SERVICES, PETITIONER

V.

MARILYN FINKELSTEIN

ON WRIT OF CERTIORARI
TO THE UNITED STATES COURT OF APPEALS
FOR THE THIRD CIRCUIT

REPLY BRIEF FOR THE PETITIONER

In our opening brief, we set forth two approaches to
this case, each of which is, in our view, independently
sufficient to support jurisdiction of the Secretary’s ap-
peal under 28 U.S.C. 1291. Under the narrower ap-
proach, whether or not the district court’s order was
final in the sense of completely terminating all judicial
proceedings on the merits, it does come within the special
class of cases in which a right of appeal nevertheless has
been recognized in furtherance of the practical con-
siderations underlying the finality principle. Gov't Br.
36-45. Second, and more broadly, under the express
terms of 42 U.S.C. 405(g)—as well as under general
principles of finality and judicial review of agency ac-
tion developed by this Court—the district court’s decision
was final in the fullest sense of the jurisdiction granted
to appellate courts by 28 U.S.C. 1291. Gov’t Br. 12-36.

(1)

2

Neither of these arguments has been refuted by re-
spondent. Indeed, respondent’s effort, by brute force, to
transpose into the administrative-review context prece-
dents of this Court that cannot sensibly be translated
verbatim to that setting ignores the distinct and im-
portant question of appealability raised in this case.
This question—of how the finality rule applies to the
right of an Executive Branch agency to appeal a dis-
trict court order that both invalidates an administra-
tive decision and remands the matter to the agency for
further proceedings under different legal standards—
has not been definitively addressed by this Court. But
as we have shown (Pet. 23-25; Reply Br. Pet. Stage
8-9; Gov’t Br. 28-29 & n.21), the great weight of au-
thority in the lower courts over the past several decades
firmly supports the agency’s right of appeal in these cir-
cumstances—a right that has been recognized in cases
arising under the Social Security Act as well as other
federal statutes. See generally Occidental Petroleum
Corp. v. SEC, 873 F.2d 325, 328-332 (D.C. Cir. 1989).
And significantly, in the leading lower court case on
the subject, Cohen v. Perales, 412 F.2d 44, 48-49 (5th
Cir. 1969), this Court granted review and reversed the
Fifth Circuit’s ruling on the merits, without question-
ing the Fifth Circuit’s holding (and supporting ration-
ale) that it had jurisdiction over the Secretary’s ap-
peal. Richardson v. Perales, 402 U.S. 389 (1971). See
Gov’t Br. 27-28.' Respondent now asks this Court to

Since this Court’s jurisdiction depended on the correctness of
the Fifth Circuit’s ruling, respondent’s attempt (Br. 42 n.36) to
minimize the significance of Cohen v. Perales by characterizing the
Court’s decision as not “reaching” the threshold jurisdictional issue
is without merit. Moreover, although respondent also attempts (Br.
42 n.36) to discount Cohen v. Perales on the ground that the Fifth
Circuit there did not have the benefit of the Court’s more recent
decisions under 28 U.S.C. 1291, those decisions in fact support the
correctness of the jurisdictional ruling in Perales. See pages 3-12,
infra.

Respondent’s related assertion (Br. 42 n.36) that “Perales is
questionable even within the Fifth and Eleventh Circuits” is equally

sweep this past practice and precedent aside, and she
does so without pointing to any adverse consequences that
have resulted to date from recognition of an agency’s
right of appeal in circumstances such as these.

1. The narrower of the two approaches suggested in
our opening brief builds upon Cohen v. Beneficial In-
dustrial Loan Corp., 337 U.S. 541 (1949). The question
before the Court under that approach is whether the
rationale and underlying principles of Cohen and its
progeny support appealability here, not, as respondent
seems to argue Br. 32-36), whether that result is com-
pelled by mechanical application of the precise terminol-
ogy used in the very different context of Cohen and
other cases involving on-going proceedings in a district

without merit. As support for this proposition in the Fifth Circuit,
respondent cites Newpark Shipbuilding & Repair, Inc. v. Roundtree,
723 F.2d 399 (en banc), cert. denied, 469 U.S. 818 (1984), but that
case involved the distinct question of the finality of an administra-
tive decision, and the court there did not even cite, much less over-
rule, Perales. As support for this proposition in the Eleventh Cir-
cuit, respondent cites Taylor v. Heckler, 778 F.2d 674, 677 (1985).
Subsequent Eleventh Circuit decisions, however, have recognized
the Secretary’s right of appeal, despite the inclusion of a remand
in the district court’s order. See Pickett v. Bowen, 833 F.2d 288,
290-291 (1987); Huie v. Bowen, 788 F.2d 698, 701-703 (1986)
North Broward Hosp. Dist. v. Bowen, 808 F.2d 1405, 1408 n.3
(1987), vacated on other grounds, 485 U.S. 1018 (1988). Moreover,
in Taylor v. Heckler itself, the panel unequivocally expressed the
view that under the provisions of 42 U.S.C. 405(g) upon which we
rely, an order holding the decision of the Secretary unlawful and
remanding for a new round of proceedings is an appealable final
judgment, but the panel felt bound by a prior Eleventh Circuit deci-
sion to the contrary that was itself a departure from Perales. See
778 F.2d at 676-677.

Finally, respondent fails in her attempt to distinguish Perales by
relying on the Fifth Circuit’s statement there that “‘an order sua
sponte by the court for the taking of additional evidence’ is not
immediately appealable.” Resp. Br. 42 n.36 (quoting 412 F.2d at 48).
The remand in this case was not an interlocutory remand for the re-
ceipt of additional evidence as a prelude to review; rather, the
remand followed the district court’s review of the Secretary’s deci-
sion on the merits.

4

court.“ In our view, the question whether Cohen sup-
ports appealability here must be answered in the
affirmative.

a. Section 28 U.S.C. 1291 grants the courts of appeals
jurisdiction of appeals from all “final decisions” of the
district courts. Ordinarily, there is no “final decision”
until the district court has entered a final judgment in
the case—“until there has been a decision by the District
Court that ‘ends the litigation on the merits and leaves
nothing for the court to do but execute the judgment.“
Midland Asphalt Corp. v. United States, 109 S. Ct. 1494,
1497 (1989). As we explain below (see pages 13-20, in-
fra), the district court’s order in this case was final in
this sense because it ended the relevant litigation con-
cerning the validity of the particular agency action be-
fore the court on judicial review. But even if we as-
sume, arguendo, that the order was not a final judgment,
it nevertheless was a “final decision” for purposes of
Section 1291.

As the Court has explained, Section 1291 does] not
uniformly limit appellate jurisdiction to ‘those final judg-
ments which terminate an action.“ Abney v. United
States, 431 U.S. 651, 658 (1977) (quoting Cohen, 337
U.S. 545). Rather, “[I]t is a final decision that Con-
gress has made reviewable. . . . While a final judg-
ment always is a final decision, there are instances in
which a fina! decision is not a final judgment.” Abney,
431 U.S. at 658 (quoting Stack v. Boyle, 342 U.S. 1, 12
(1951) (Jackson, J., concurring) ). See also Mitchell v.
Forsyth, 472 U.S. 511, 524 (1985) (“a decision ‘final’
within the meaning of § 1291 does not necessarily mean
the last order possible to be made in a case”). The stat-
utory reference to “final decisions” thus suggests a flex-
ibility that is harder to read into the term “final judg-

2 As the Court explained in Eisen v. Carlisle & Jacquelin, 417 U.S.
156, 170 (1974): “No verbal formula yet devised can explain prior
finality decisions with unerring accuracy or provide an utterly re-
liable guide for the future.”

5

ment.“ And the Court has repeatedly emphasized that
the inquiry into finality requires an evaluation of the
“eompeting considerations” underlying questions of ap-
pealability. Eisen v. Carlisle & Jacquelin, 417 U.S. 156,
171 (1974); see also Dickinson v. Petroleum Conversion
Corp., 338 U.S. 507, 511 (1950). Cohen and its progeny
thus do not represent an “exception” to the general prin-
ciple of finality under 28 U.S.C. 1291, but rather an ap-
plication of that principle to a discrete category of cases
involving orders entered in the course of on-going pro-
ceedings in the district court.*

3 Respondent’s reliance (Br. 34 n.28) on Ex parte Tiffany, 252 U.S.
32, 36 (1920), for the proposition that the term “final decision” in
what is now Section 1291 means the same thing as “final judgment”
therefore is inconsistent with the Court’s more recent understand-
ing. Harrington v. Haller, 111 U.S. 796, 797 (1884), also cited by
respondent (Br. 34 n.28), involved a different jurisdictional statute
governing this Court’s jurisdiction to review decisions of a terri-
torial court.

On a similar point, respondent also miscites P. Bator, D. Meltzer,
P. Mishkin & D. Shapiro, Hart & Wechsler’s The Federal Courts
and the Federal System (3d ed. 1988). That work does not, as
respondent implies (Br. 34 n.28), argue that “final decision” (in
Section 1291) is a more restrictive term than “final judgment” (in
28 U.S.C. 1257). To the contrary, in the discussion cited by re-
spondent, the work simply proposes several possible bases for dis-
tinguishing between the sections, several of which—including
the language of the two statutes”"—cut in favor of a broader
reading of Section 1291. P. Bator et al., supra, at 1812.

In any event, the term “final judgment” in 28 U.S.C. 1257, which
governs this Court’s jurisdiction to review the decisions of state
courts, also has been given a practical construction. That construc-
tion permits review by this Court of a distinct federal issue re-
solved by a state appellate court in certain circumstances, even
where further proceedings, including a trial, remain to be con-
ducted in a lower state court on remand. See generally Cox Broad-
casting Corp. v. Cohn, 420 U.S. 469, 477-485 (1875). It is signifi-
cant that in those cases, as here, there was no interference with
on-going proceedings in the court whose decision was deemed
final.“

A similar application of, rather than exception to, the finality

requirement in Section 1291 is embodied in Fed. R. Civ. P. 54(b).
In Sears, Roebuck & Co. v. Mackey, 351 U.S. 427, 436-437 (1956),

6

Of course, Cohen does represent an exception to the
general rule under Section 1291 that ordinarily there
is no “final decision” until the district court has entered
a final judgment that terminates the entire litigation.
But the Court has not held that orders satisfying the
precise terminology used in Cohen and its progeny ex-
haust the category of orders that qualify for appeal
prior to entry of a judgment formally terminating the
litigation. To the contrary, the Court has held that
(quite aside from the “collateral order” doctrine) an
order staying proceedings pending resolution of state-
court proceedings on the same issue was a “final de-
cision” because, although no final judgment had been
entered, the order meant that as a practical matter there
would be no further litigation on the issue in the dis-
trict court. Moses H. Cone Memorial Hosp. v. Mercury
Constr. Corp., 460 U.S. 1, 9-10 (1983). See also Forgay
v. Conrad, 47 U.S. (6 How.) 201, 203 (1848); Brown
Shoe Co. v. United States, 370 U.S. 294, 307-311 (1962);
cf. Coopers & Lybrand v. Livesay, 437 U.S. 463, 467-
468 (1978) (because order refusing to certify a class
did not terminate the litigation, it could be appealed
under Section 1291 only if it came within “an appro-
priate exception” to the final-judgment rule; respond-
ents relied solely on the “collateral order” exception ar-
ticulated in Cohen).

b. There is no need here, however, for the Court to
articulate any new or distinct exception to the final-
judgment rule. Taking into account the structurally
different character of the present case—the fact that
the action alleged to preclude “finality” is the remand
to a different Branch—it is clear that the principles
underlying Cohen and its progeny fully support the Sec-
retary's right of appeal. Those principles, like the

the Court explained that Rule 54(b) is not in derogation of the
finality requirement; rather, it is an authorization to release for
appeal “final decisions” on one or more, but less than all, claims in

7

finality requirement itself, must be given a “practical
rather than a technical construction.” 337 U.S. at 546.
Ultimately, the inquiry must be whether allowing an
appeal is consistent with the purposes of the finality
requirement, and each prong of the Cohen formulation
should be interpreted in light of those purposes.“

i. The first requirement under the Cohen doctrine—
that the district court’s order “conclusively determine
the disputed question,” Coopers & Lybrand, 437 U.S.

5 Respondent's assertion (Br. 33) that the precise articulation of
the factors in Coopers & Lybrand is “fully applicable in the context
of judicial review of administrative agency action’—and requires
dismissal of the Secretary’s appeal here—is incorrect. Respondent
principally relies for this assertion upon FTC v. Standard Oil Co.,
449 U.S. 232 (1980), but that case involved the completely different
issue of the finality of an administrative decision.

Ironically, respondent also cites (Br. 33) Occidental Petroleum
Corp. v. SEC, 873 F.2d 325, 328-332 (D.C. Cir. 1989), for the same
point. In Occidental Petroleum, the court of appeals in fact sus-
tained the agency’s right of appeal, despite the inclusion of a
remand in the district court’s order, and it specifically recognized
the need for a practical application of the Cohen factors in that
setting. 873 F.2d at 330-331. The court observed: “At least in the
present context, the distinction between a final order and an inter-
locutory order that is nonetheless appealable under the collateral
order doctrine is, as a practical matter, purely terminological.” Id.
at 331.

Finally, respondent errs in citing (Br. 33) Seatrain Shipbuilding
Corp. v. Shell Oil Co., 444 U.S. 572 (1980) (Br. 33) in support of
her argument that the Secretary could not appeal in this case
under the principles of Cohen. The Court in Seatrain did not reach
the question whether the district court’s order was final in all
respects, because it found that the district court had properly
exercised its authority to release for appeal a “final decision” relat-
ing to one aspect of the case. See note 4, supra. The sentence
quoted by respondent (444 U.S. at 583 n.21) emphasizes the finality
of the decision being appealed, even assuming (though the Court
clearly did not decide, see id. at 581 n.17) that the disposition of
the case as a whole was not “final” for purposes of 28 U.S.C. 1291.

Moreover, in Seatrain, the appeal in question was not taken by the
agency (as in this case), but by the private party who had success-
fully urged the district court to set aside the agency action.

at 468—is clearly satisfied. Respondent reduces her an-
swer on this point to a foctnote, observing (Br. 40-41
n.33) that “there is nothing to prevent the district court
from reconsidering its prior decision following a return
to the district court by either party.” This aspect of the
Cohen test, however, was intended to exclude orders
that are “inherently tentative,” such as the order denying
class certification in Coopers & Lybrand. See Moses H.
Cone, 460 U.S. at 12 n.14 (quoting 437 U.S. at 469 n.11).
Accord Gulfstream Aerospace Corp. v. Mayacamas Corp.,
485 U.S. 271, 277-278 (1988); see also Cohen, 337
U.S. at 546 (statute “disallow[s] appeal from any de-
cision which is tentative, informal or incomplete“). Con-
trary to respondent’s contention, the mere possibility,
which is present in virtually every case, that a prior
ruling might be altered for cause shown prior to entry
of a final judgment does not render all such orders “ ‘in-
herently tentative’ in the sense of that phrase in Coop-
ers & Lybrand.” Moses H. Cone, 460 U.S. at 12-13 n.14.
It is therefore sufficient here that the district court’s rul-
ing regarding the legal insufficiency of the Secretary’s
reliance on the Listing was made “with the expectation
that [it] will be the final word on the subject addressed.”
Ibid.

ii. With respect to the second factor articulated in
Cohen and related cases, the point, as emphasized in our
opening brief (Gov’t Br. 40-41), is that the issue on
appeal is functionally separate from the rest of the case
in two critical respects. First, because the cause is no
longer before the district court, but rather has been
remanded in its entirety to the Secretary, there can be
no disruption of an ongoing trial process in the district
court—a principal danger that underlies this aspect of
the Cohen limitation of appellate jurisdiction. See Bud-
inich v. Becton Dickinson & Co., 486 U.S. 196, 202
(1988) (inquiring whether appeal will be “disruptive of
ongoing proceedings”); Moses H. Cone, 460 U.S. at 31
(Rehnquist, J., dissenting) (Section 1291 “is a con-

gressional command to the federal courts of appeals not
to interfere with the district courts’ management of
ongoing proceedings”) .°

Second, since the agency on remand is governed by
the district court’s ruling on the matter sought to be
appealed in this case, that matter cannot be reconsidered
by the agency or affected by its new decision. Nor will it
be an issue in the district court if and when a later ac-
tion for review is brought by the claimant, except in the
sense that any court has the power to reverse itself
on an earlier ruling in the same proceeding—a bare pos-
sibility that, as we have already shown (see page 8,
supra), is insufficient to preclude appealability. See
Abney, 431 U.S. at 660 (quoting Cohen, 337 U.S. at 546
(matter appealed “will not ‘affect, or ... be af-
fected by,” subsequent proceedings in district court) ).
Nor, contrary to respondent’s contention (Br. 43-44),
does the existence of some factual overlap between the
issue being appealed and the proceedings on remand fore-
close the Secretary’s right of appeal. See Mitchell v.
Forsyth, 472 U.S. at 528-529 & n. 10.“

The Court has observed that the second requirement under the
Cohen formulation—the separability of the issue to be appealed— is
“(e}losely related to the ‘threshold requirement of a fully consum-
mated decision.“ United States v. MacDonald, 435 U.S. 850, 859
(1978). Because a district court order holding the Secretary's de-
cision unlawful and remanding for further proceedings under dif-
ferent legal standards constitutes a final rejection of the particular
decision of the Secretary that is before the court, an appeal by the
Secretary is not “likely to eliminate a trial judge's opportunity for
reconsideration.” Budinich, 486 U.S. at 202.

7 Respondent also argues (Br. 41-43) that an appeal should not be
allowed because the district court did not resolve an “important
issue.” Yet it is hard to see how a decision effectively invalidating a
policy of the Secretary embodied in forma] regulations can be
regarded as anything less. Respondent disputes (Br. 41 n.34) that
the district court’s order had that effect. But the district court
affirmed the Secretary's finding that respondent did not establish
that she had an impairment that met or equalled a listed impair-
ment. Pet. App. l5a-léa. If the district court had respected the

10

iti. With respect to the third factor—the “effective
unreviewability” of the ruling at a later stage—we
strongly disagree with both of respondent’s arguments.
The fact that the claimant may return to the district
court if she loses in the rehearing at the administrative
level (see Resp. Br. 37-38) is and should be analytically
irrelevant. The notion of reviewability as developed in
Cohen and its progeny is one that turns on whether the
decision now being appealed will be subject to later re-
view if the other party to the litigation ultimately pre-
vails. After all, reviewability (in the court of appeals)
if the claimant loses at the administrative level depends
entirely on facts beyond the Secretary’s control—
whether the claimant seeks judicial review of the Sec-
retary’s new decision and whether, if she does, she pre-
vails in the district court.

Respondent argues in the alternative (Br. 38-40) that
the district court’s decision at this stage will be review-

statutory text (42 U.S.C. 423(d)(2)(B) (1982 & Supp. V 1987))
and the Secretary's implementing regulations, that finding would
have compelled affirmance of the Secretary's decision denying re-
spondent’s claim. See Gov't Br. 5 n.7. The district court's insistence
on a distinct, individualized assessment of residual functional capac-
ity therefore effectively invalidated the statutory and regulatory
limitation on eligibility. Compare Heckler v. Campbell, 461 U.S. 458,
465-466 (1983) (lower court’s requirement that additional evidence
be introduced on particular types of jobs available for claimant im-
plicitly calls into question validity of medical-vocational guidelines
that dictate answer to that question).

Despite respondent’s protestations (Resp. Br. 41, 48), the fact
that the same question may arise in some o* ser case that may reach
a court of appeals is irrelevant both to tie issue of the importance
of the district court’s determination and to the issue, discussed
below, of the effective unreviewability of that determination. That
the question may arise in another case is a fortuity that has never
entered into the calculus and should not. And indeed the matter of
appealability in dispute here is at least as likely to arise in the
context of district court review of administrative regulations that
would not be subject to review in any other forum or any other
case. Compare Gov't Br. 39 n.30.

11

able if the claimant prevails before the Secretary be-
= — — may file the decision in district
court for purposes of determining attorney’s fees under
the Equal Access to Justice Act (EAJA), 28 U.S.C. 2412.
This is an argument we think the Court can accept only
by severely straining statutory provisions governing ju-
dicial review that were enacted long before the EAJA.
Although we agree that it is appropriate for the Sec-
retary to notify the district court of a decision in the
claimant’s favor on remand so that EAJA fees may be
awarded, the limited, essentially ministerial purpose of
that notification does not extend to a review of the
merits, either in the district court or the court of ap-
peals. See point 2(b), infra.* Indeed, if it did, what
would prevent the Secretary from disagreeing with the
judgment of his own Appeals Council and asking the
district court not to affirm (as respondent apparently be-
lieves the Secretary must do) but to reverse, because the
Appeals Council made an error on remand? The Secre-
tary has no such authority as a general matter (see

All but one of the cases cited by respondent (Br. 23-24, 39 n.31)
that refer to the Secretary's filing with the court any decision on
remand that is favorable to the claimant were concerned only with
providing a realistic mechanism for the award of attorney’s fees
at that point. In each of those cases, the claimant was not yet a
“prevailing party” within the meaning of the EAJA at the time of
the court’s order setting aside the Secretary’s first decision (which
denied benefits) and remanding for further p ings. See Sulli-
van v. Hudson, 109 8. Ct. 2248, 2255 (1989 hae poe infra. None
of the cases suggested that the court would take any further action
on the merits beyond the essentially ministerial act of entering an
order on the basis of the Secretary's filing in order to trigger the
court's authority to award attorney’s fees under the EAJA. In the
remaining case, Wilson v. Heckler, 609 F. Supp. 120 W. D. Mo.
1985), the court expressly stated that the sixth sentence of 42
U.S.C. 405(g) requires a subsequent filing in court only where the
court has provided for reopening of the administrative proceedings
“before making any decision on the merits.” 609 F. Supp. at 122.

12

Gov’t Br. 42 & n.33), and he does not seek it here.“ But
we do not see how it can be denied if the district court’s
jurisdiction is as expansive as respondent now argues.

2.a. Our broader submission in this case is that the
district court’s order was “final,” in the fullest sense of
that term, because it constituted a final rejection of the
particular administrative decision before the court on
judicial review and therefore ended the relevant litiga-
tion on the merits. The finality of the court’s order in
this regard is not destroyed by the fact that the court,
as relief, then remanded the cause to the Secretary for
a fresh round of administrative proceedings and the
rendering of a new decision. To the contrary, the re-

o Respondent errs in relying (Br. 23-24, 38-39) on the sixth sen-
tence of 42 U.S.C. 405(g) as requiring the Secretary to file the new
decision on remand with the court in a case such as this. As we
have explained (Gov't Br. 21-24), the sixth sentence (including the
filing requirement) applies only to a special category of remands
initiated by the Secretary or ordered by the court for the receipt
of newly discovered evidence. But even if the sixth sentence re-
quirement extended to the present situation, it would not follow
that the Secretary would thereby be authorized to challenge the
decision of his own Appeals Council awarding benefits. The Secre-
tary lacks a right to judicial review even where he believes that
the Appeals Council has committed an error of law. We see no
statutory basis for an exception to this preclusion where the Ap-
peals Council's legal error was dictated by a judicial order in pro-
ceedings for judicial review of the Secretary's original decision.
To the contrary, the seventh sentence of 42 U.S.C. 405(g), which
respondent properly insists (Br. 38-39) must be read in tandem with
the filing requirement in the sixth sentence, provides that the new
findings and decision filed with the court after a remand “shall be
reviewable only to the extent provided for review of the original
findings of fact and decision.”

If the Secretary cannot challenge the decision of his own Appeals
Council in the district court, it would seem to follow that he cannot
appeal a district court order affirming the Appeals Council’s deci-
sion. Thus, the Secretary’s ministerial district court filing, for pur-
poses of the EAJA, of a remand decision favorable to the claimant
does not furnish a suitable procedure for the Secretary to challenge
the district court's prior legal ruling in the court of appeals.

13

mand underscores the finality of the judicial order be-
cause it removed all matters concerning respondent’s
claim for benefits from the court and returned them to
the official of another Branch who is responsible for ad-
ministering the Social Security Act.

In a case such as this, the district court’s mandate is
fully satisfied, and the claimant receives all the relief
to which she is entitled under the court’s order, when the
Secretary completes the rehearing pursuant to the re-
mand and renders a new decision on the claim for bene-
fits. The possibility of subsequent proceedings for judi-
cial review on the distinct question of the validity of the
Secretary’s second decision therefore does not detract
from the finality, for purposes of 28 U.S.C. 1291, of the
court’s order holding the Secretary’s first decision un-
lawful.

As explained in our opening brief (Gov’t Br. 30-36),
this conclusion is supported by general principles gov-
erning judicial review of agency action under the Ad-
ministrative Procedure Act, as well as principles of final-
ity under 28 U.S.C. 1291 and similar statutes.” We

1% We have cited in our opening brief (Gov't Br. 29-30) several
of this Court’s decisions in cases arising under the Hobbs Ad-
ministrative Orders Review Act, 28 U.S.C. 2341-2350, which (in
Section 2350) limits this Court’s review to orders granting or
denying interlocutory injunctions and to “final” judgments. (Just
last month, this Court granted certiorari in two other such cases in
which the court of appeals remanded to the agency, and no jurisdic-
tional question was raised in the petitions or responses or suggested
by the Court. See Norfolk & Western Ry. v. American Train Dis-
patchers Ass’n, No. 89-1027 (Mar. 26, 1990); CSX Transportation,
Inc. v. Brotherhood of Railway Carmen, No. 89-1028 (Mar. 26,
1990).)

The purpose of those citations was not to show that the precise
jurisdictional issue raised here has already been addressed and
resolved by the Court, but rather to indicate that in a closely analo-
gous context, the litigants and this Court have—quite properly in
our view—assumed the existence of jurisdiction. Respondent, how-
ever, argues that the cases are not in point because this Court is
not limited by the “final judgment” language in Section 2350: in
respondent’s view (Br. 33-34 n.28), the Court also has jurisdiction

14

further explained (Gov’t Br. 15-21, 27) that those gen-
eral principles are given expression in the precise con-
text of this case in the statutory provision governing
judicial review of agency action under the Social Secur-
ity Act, 42 U.S.C. 405(g). The fourth and eighth sen-
tences of Section 405(g) expressly contemplate (i) that
a judicial order affirming, modifying, or reversing the
Secretary’s decision is a “final” “judgment,” whether or
not the court “remand[s] the cause for a rehearing” by
the Secretary, and (ii) that any such judgment (i. e.,
whether “with or without” a remand) “shall be subject
to review in the same manner as a judgment in other
civil actions.“ Contrary to respondent’s assertion (Br.
13 & n.9, 16), this is not a novel interpretation of 42
U.S.C. 405(g). It was relied upon by the Fifth Circuit
in its leading decision rendered more than 20 years ago,

under 28 U.S.C. 1254(1) to grant certiorari in such cases in the
absence of a final judgment. That cannot be. The Hobbs Act makes
the courts of appeals the point of entry into the federal judicial
system in cases subject to its terms, and Section 2350 is plainly
designed to put this Court, as the first reviewing court, in the
same relation to the courts of appeals that those courts normally
bear to the district courts. Thus, the specific provisions of Section
2350 must prevail over the more general provisions of Section 1254.

In her only effort to grapple with the controlling statutory
text, respondent views (Br. 25) the quoted language as merely
suggesting that, in determining the appealability of district court
orders entered under 42 U.S.C. 405(g), appellate courts should look
to the appropriate jurisprudence under Section 1291. But that is
not what the fourth and eighth sentences gay. They provide that
an order such as that at issue here is both a judgment“ and final“
—terms strongly indicative of appealability—and that the judgment
“shall be subject to review” in the same “manner” (ie, subject to
the same procedures) as the judgment in other civil actions. There
is no suggestion that the judgment, deemed final, might not be
subject to appeal at all. Respondent’s extended discussion (Br. 20-
23) of the source of the district court’s remand authority—.e.,
whether it is conferred by Section 405(g) or an inherent equitable
power—is irrelevant to the question whether a remand precludes
an appeal of an otherwise appealable order.

15

Cohen v. Perales, 412 F.2d at 48. See also Taylor v.
Heckler, 778 F.2d 674, 676-677 (11th Cir. 1985).

b. In her effort to reply to our argument, respondent
wholly misconceives it. She states (Br. 13-15) that we
are claiming a right to appeal from a “fourth sentence”
remand order, although we concede that there can be
no appeal from a “sixth sentence” remand order under
42 U.S.C. 405 (g). Thus, she concludes (Br. 30-31), we
are asking courts to enter an intricate thicket of dis-
tinguishing among remand orders, a task whose diffi-
culty, in her view, is demonstrated by our disagreement
about what type of remand order is involved here.

Respondent is correct that we disagree about whether
the remand in this case was issued under the sixth sen-
tence of Section 405(g); we think it clear that it was
not.“ But that disagreement is irrelevant to our argu-
ment. The point remains that we are appealing not
from the remand itself, but from the district court’s
antecedent decision—unquestionably made under the au-
thority granted by the fourth sentence of Section 405(g)

12 To be sure, most decisions sustaining the Secretary's right of
appeal in circumstances such as these have relied on the rationale
of Cohen v. Beneficial Industrial Loan Corp., which also was relied
upon in Perales, 412 F.2d at 48.

18 Respondent’s contention (Br. 28-29) that the district court’s
remand in this case was governed by the sixth sentence of 42 U.S.C.
405(g), and for this reason could not be appealed by the Secretary
even under our theory, is wholly without merit. The case was not
remanded for the receipt of “new” and “material” evidence to
facilitate the court’s own review of the Secretary’s decision; it was
remanded only after, and as a consequence of, such review by the
court, which found the Secretary’s decision unlawful because of its
reliance on the Listing of Impairments. As explained in our open-
ing brief (Gov’t Br. 23-24), the courts of appeals have uniformly
recognized that such a remand is not governed by the sixth sentence
of Section 405(g). Contrary to respondent’s suggestion (Br. 28,
29), the fact that the district court's order contains the phrase “for
good cause shown”—a phrase also contained in the sixth sentence
of Section 405(g)—does not alter the fundamental character of the
order.

16

—reversing the Secretary for an error of law in his
reliance on the Listing of Impairments in the govern-
ing regulations. That is the decision we contend is made
“final” both by the explicit terms of Section 405(g) and
by general principles of finality. And since the re-
spondent’s action for judicial review has been effectively
terminated for present purposes (though not for pur-
poses of an award of attorney’s fees) by the remand,
an appeal properly lies. Because the remand itself is
not the subject of the Secretary’s appeal in a case such
as this, there is no need to distinguish between different
types of remands as a precondition to entertaining his
appeal.

The point, we believe, is well illustrated by the closely
analogous ruling of this Court in Waco v. United States
Fidelity & Guaranty Co., 292 U.S. 140 (1934). In that
case, a third party who had been impleaded in a state
court removed the action to a federal court; the federal
court in “a single decree” (id. at 142) dismissed the ac-
tion against the third party and, there being no remain-
ing diversity of citizenship, remanded the case to the
state court. One of the defendants then sought to appeal
not from the order of remand, but from that dismissing
its action against [the third party].” Jbid. Although
recognizing that then (as now, see 28 U.S.C. 1447(d))
no appeal lay from an order of remand, this Court up-
held the defendant’s right to appeal the dismissal of its
action against the third-party defendant. If the appeal
was sustained, even though it might not affect the order
of remand, it would restore the third-party defendant to
the action. So here, if the appeal is sustained, it will
restore the decision of the Secretary and the regulatory
policy that was effectively invalidated by the district
court. Accord, Mitchell v. Carlson, No. 89-1377 (5th Cir.
Mar. 15, 1990), slip op. 2659-2663.“

14 Because the subject of the Secretary’s appeal was not the re-
mand itself, but the district court’s overturning of the Secretary’s
decision (and the legal ruling on which it was based), the Secre-
tary’s right of appeal is fully consistent with the general rule, cited

17

c. Respondent’s reliance (Br. 14, 17-20, 35) on the
decision last Term in Sullivan v. Hudson, 109 S. Ct. 2248
(1989), is misplaced. The issue the government argued
and lost in Hudson is whether attorney’s fees may be
awarded under the EAJA (28 U.S.C. 2412) for services
rendered in proceedings before the agency on remand—
an issue that is quite distinct from the question of ap-
pellate jurisdiction under a statute enacted long before
the EAJA. Under the EAJA, no fees can be awarded
for work done at any level (administrative or judicial)
until it is determined whether the claimant is a “pre-
vailing party” on his or her underlying claim for bene-
fits. Sullivan v. Hudson, 109 S. Ct. at 2255. When a
court sets aside the Secretary’s initial decision denying
benefits and remands the entire cause to the Secretary,
that determination must await the outcome of the re-
hearing on remand and any further action for judicial
review. To accommodate this feature of the EAJA, it
is appropriate for the record on remand to be filed with
the court if the claimant has prevailed, so that a fee de-
termination may be made. Thus, as the Court noted in
Hudson, “for purposes of the EAJA,” finality must
await the outcome of proceedings on remand. 109 S. Ct.

by respondent, that “a [district court’s] remand order [to any ad-
ministrative agency] is ‘interlocutory’ rather than ‘final,’ and thus
may not be appealed immediately” under 28 U.S.C. 1291. See Resp.
Br. 12-13 (quoting Occidental Petroleum Corp. v. SEC, 873 F.2d
at 329). In fact, Occidental Petroleum sustained the agency’s right
of appeal where, as here, the district court’s order resolved a legal
issue on which effective appellate review might be foreclosed at a
later date.

The fact that the Secretary’s appeal is from the district court's
ruling on the merits (not the resulting remand) also serves to
distinguish this case from those in which the courts have not per-
mitted a claimant to appeal a pure remand order. Thus, the result
we believe Section 405(g) requires would not impose a burden on
the courts of appeals of entertaining appeals by claimants who chal-
lenge the court’s separate decision to remand for further pro-
ceedings.

18

at 2255. But the proposition that the absence of final-
ity with respect to attorney’s fees does not affect finality
for purposes of appeal is one well recognized by this
Court. See Budinich v. Becton Dickinson & Co., supra.
Thus, respondent is in error in suggesting that the deci-
sion in Hudson somehow resolves the issue here.“

10 The passage in the House Report on the 1985 amendments to
the EAJA quoted by respondent (Br. 18 n.13, 27) has no bearing
on the proper interpretation of 28 U.S.C. 1291 and 42 U.S.C.
405(g), which were enacted many years earlier. In any event, that
passage was part of a discussion about the practical application of
the EAJA in the particular context of remand orders that do not
in themselves render a claimant a “prevailing party” on his under-
lying benefits claim; it did not express any view on the appeal-
ability question. See H.R. Rep. No. 120, 99th Cong., Ist Sess. 19-20
(1985).

16 Respondent contends that we made a crucial concession in
Hudson that a remand order from a district court to the agency is
not a final determination of the civil action and that the district
court “retains jurisdiction to review any determination rendered on
remand.” Resp. Br. 14, 19, quoting Hudson, 109 S. Ct. at 2255
(quoting Hudson Pet. Br. at 16-17). The single sentence in our
opening brief in Hudson (at 16-17) upon which respondent appar-
ently relies stated: “Respondent asserts that since the reviewing
court retains jurisdiction to review any decision rendered on remand
[footnote quoting sixth sentence of Section 405(g) omitted], the re-
mand order does not terminate the judicial action, and the proceed-
ings on remand must therefore be treated as part of the civil action
for purposes of EAJA.” This sentence essentially recited the re-
spondent’s position as articulated in her brief in opposition; it did
not concede that a remand does not terminate the judicial action, and
& did not purport to be a definitive of explication 42 U.S.C. 405(g)
in all respects, especially as regards appealability under 28 U.S.C.
1291, which was not mentioned.

Any doubt on this score is dispelled by our reply brief on the
merits in Hudson (at 14-17). There, we answered at length the
respondent’s reliance on the sixth sentence of Section 405(g). We
argued (Reply Br. 16), citing Cohen v. Perales, supra, that an
order modifying or reversing the Secretary’s decision on the merits
and remanding for a rehearing under different legal standards “is
a ‘final judgment’ that effectively terminates the proceedings for
judicial review of the particular decision of the Secretary that was
modified or reversed.” Moreover, in both our opening brief (at 17)

sult of the prompt appellate holding to that effect. Un-
der the Secretary’s announced policy concerning acquies-
cence in the adverse rulings of a circuit court of appeals
within that circuit, the Secretary will either seek further
review of the court of appeals’ ruling or will promptly
publish his acquiescence in it. See 55 Fed. Reg. 1012
(Jan. 11, 1990). But until and unless such a definitive
ruling by the court of appeals is obtained, no acquies-
cence can be forthcoming with respect to an issue on
which district court holdings (and even the holdings of
other circuits) conflict with the Secretary’s view. Such

and reply brief ‘at 15), we urged that whether or not the particular
district court decision was “final,” attorney’s fees should not be
awarded for work done at the administrative level. We of course
do not challenge the Court's contrary holding in Hudson regarding
the availabiilty of attorney’s fees, but the Secretary cannot fairly
be taken to have made any concessions there that undermine his
right of appeal here.

17 Respondent suggests (Br. 35-36 n.29) that we are relying on
Section 1292(a)(1) as an independent basis of jurisdiction. Al-
though such reliance was indicated in our certiorari petition (Pet.
18-19), we did not press it in our opening brief. Rather, we sought
(Gov’t Br. 33-34 n.27) to support our finality argument by showing
that, in the absence of specific statutory review provisions, an ac-
tion such as this would have been brought as an independent action
for mandamus or an injunction, and the court’s order setting aside
the agency's decision and ordering the Executive Branch official to

a ruling by the court of appeals will also serve the public
interest by relieving the district courts in the circuit of
the burden of further litigation on the legal issue. More-
over, in many instances involving an important adminis-
trative policy, allowing an appeal from a district court
ruling that the policy is invalid will eliminate the wide-
spread uncertainty created by the district court's
opinion.

For the foregoing reasons and those stated in our
opening brief, it is respectfully submitted that the judg-
ment of the court of appeals should be reversed.

KENNETH W. STARR
Solicitor Generai

APRIL 1990

conduct a new round of administrative proceedings would unques-
tionably have been subject to an immediate appeal.

Contrary to respondent’s suggestion (Br. 48-50), the availability
of interlocutory appeals under 28 U.S.C. 1292(b) should not affect

has authorized as of right would be replaced by an appeal that is
wholly within the unreviewable and absolute discretion of both the
district and appellate courts.

Ä 1990 262203 654

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385012_0677%3A7. Public record. Not legal advice.