## Facts

- Stephen Sprinkle applied for Supplemental Security Income in 2005 and was denied benefits through the administrative process.
- He sought judicial review in federal district court.
- In 2012, the district court reversed and remanded, finding the government’s position not substantially justified, making Sprinkle eligible for fees under the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412(d).
- Sprinkle requested EAJA attorney’s fees at $173.38 per hour (above the $125 statutory cap), based on a Consumer Price Index (CPI) cost-of-living adjustment for the relevant work period.
- He supported the request with CPI calculations and affidavits from Social Security practitioners stating market rates of roughly $250–$500 per hour.
- The district court awarded EAJA fees but denied any cost-of-living increase, reading circuit precedent to require a more specific showing that inflation increased litigation costs and that counsel could not be obtained at $125 per hour.

## Issues

1. Whether the district court abused its discretion by denying a cost-of-living enhancement above the EAJA’s $125 hourly cap.
2. Whether CPI-based calculations and evidence of prevailing market rates for comparable services are sufficient to justify an EAJA cost-of-living increase in the absence of rebuttal evidence from the government.

## Decision

- The Seventh Circuit vacated the fee order in part and remanded.
- The court held the district court misread prior precedent and applied an excessively demanding evidentiary requirement.
- The court concluded Sprinkle’s CPI evidence and market-rate affidavits were sufficient to support a higher hourly rate unless the government produced contrary evidence.
- On remand, the district court was directed to reconsider the hourly rate under the clarified standard and recalculate fees accordingly.

## Legal Principles

- EAJA fees generally may not exceed $125 per hour, but a higher rate may be awarded when a court finds that increased cost of living or another qualifying factor justifies it. 28 U.S.C. § 2412(d)(2)(A).
- A claimant seeking a cost-of-living increase may satisfy the evidentiary burden by presenting objective inflation evidence (such as CPI data) and competent proof that prevailing market rates for similar services exceed $125 per hour.
- The claimant need not provide case-specific, itemized proof that each component of law-practice expenses rose, or prove that no attorney would accept representation at $125 per hour.
- Once the claimant produces CPI and market-rate evidence supporting the requested rate, the government may rebut with evidence that the rate exceeds prevailing market rates or that the inflation showing does not justify the increase.

## Conclusion

The Seventh Circuit held that the denial of a cost-of-living enhancement rested on an incorrect reading of circuit law and that CPI data combined with market-rate evidence can justify an EAJA hourly rate above $125; it vacated the fee ruling in part and remanded for recalculation under the proper standard.


Sprinkle v. Colvin, 777 F.3d 421 (7th Cir. 2015)