## Facts

- William Raines applied for Social Security disability insurance and SSI benefits, alleging disability from back and psychological impairments.
- An ALJ denied benefits, finding no significant physical or psychological limitations; the Appeals Council denied review, making the denial final.
- Raines sought judicial review; the district court (by consent, through a magistrate judge) remanded after finding the ALJ failed to fully develop the mental-impairment issue.
- On remand, the ALJ took additional evidence, heard psychological and vocational testimony, and awarded benefits; the agency decision became final without a further merits ruling by the district court.
- Raines moved for attorney’s fees and expenses under the Equal Access to Justice Act (EAJA), and the district court awarded fees at an enhanced hourly rate and included compensation for work performed in post-remand administrative proceedings.
- The Secretary appealed the enhancement and the inclusion of post-remand administrative fees.

## Issues

1. Whether EAJA’s “special factor” exception permits an hourly-rate enhancement based on counsel’s Social Security disability expertise and an asserted limited availability of such attorneys.
2. Whether EAJA authorizes recovery of attorney’s fees for administrative work performed after a district court remand to the agency in a Social Security case.

## Decision

- The Seventh Circuit reversed the fee award and remanded for recalculation.
- The court held the district court improperly enhanced the EAJA hourly rate based on a non-qualifying “special factor.”
- The court held the district court improperly included fees for post-remand administrative proceedings on this record under the Supreme Court’s framework for when such work can be compensable.

## Legal Principles

- EAJA’s statutory hourly cap may be exceeded only for cost-of-living adjustments or a narrowly construed “special factor” requiring distinctive, specialized skills necessary for the litigation and not generally available at the capped rate.
- Social Security disability practice experience and general scarcity of willing counsel, without more, do not constitute a “special factor” justifying a rate enhancement under EAJA.
- EAJA generally compensates fees incurred in a “civil action,” not ordinary administrative proceedings.
- Post-remand administrative fees may be available only when the remand and subsequent administrative work are closely connected to the judicial action in the manner described by Supreme Court precedent (including factors such as retained jurisdiction and administrative proceedings necessary to effectuate the court’s judgment).

## Conclusion

The Seventh Circuit held that EAJA fee enhancements require rare, litigation-necessary specialized skills beyond ordinary practice experience, and that post-remand administrative work is not automatically compensable; it reversed the district court’s award and remanded for recalculation consistent with these limits.


Raines v. Shalala, 44 F.3d 1355 (7th Cir. 1995)