Zieroth v. Azar
- Maxine Chesney
- 3:20-cv-00172
- U.S. District Court · Northern District of California
- 7
In Zieroth v. Azar, Judge Chesney partly granted and partly denied the fee motion, awarding $19,838.60 in fees and $400 in costs while rejecting enhanced fees for bad faith.
The estate of Sharon Zieroth receives $19,838.60 in attorney fees and $400 in costs; the Secretary of Health and Human Services was not required to pay enhanced fees based on bad faith.
What happened
In Zieroth v. Azar, Gary Zieroth represented the estate of Sharon Zieroth in seeking reimbursement for three Medicare claims involving continuous glucose-monitor sensors. The court had previously ruled for Zieroth and ordered coverage for the sensors. Zieroth then sought $53,835 in attorney fees and $400 in costs under a federal law allowing fees when the government’s position was not reasonably justified.
The court agreed that the government’s position was not reasonably justified because the court had found it unreasonable, and other district courts had rejected it. But the court did not find that the government acted in bad faith. The court also ruled that 2.4 hours spent hand-delivering court papers were clerical work and should not be included in the fee award.
Judge Chesney granted in part and denied in part Zieroth’s motion. The court awarded $19,838.60 in attorney fees and $400 in costs, but did not award enhanced fees based on bad faith.
The detailed version
- Zieroth v. Azar · No. 3:20-cv-00172
- Maxine Chesney
- Dec. 3, 2020
Background
Gary Zieroth sued Alex Azar, in his capacity as Secretary of Health and Human Services, as representative of the estate of Sharon Zieroth. Sharon Zieroth had type 1 diabetes and used a continuous glucose monitor, including a Medtronic MiniMed 530G system. Medicare denied reimbursement claims for three sensors because the Secretary’s position was that this type of continuous glucose monitor did not qualify as “durable medical equipment.”
In an earlier order in this action, the court granted Zieroth’s motion for summary judgment, denied the Secretary’s cross-motion for summary judgment, and remanded the action with instructions to authorize coverage for the three sensors. Zieroth then moved under the Equal Access to Justice Act (EAJA) for $53,835 in attorney fees and $400 in costs.
Entitlement to Fees
The EAJA generally requires an award to a prevailing party unless the government’s position was substantially justified or special circumstances would make an award unfair. The court stated that a substantially justified position must have a reasonable basis in both law and fact.
The court found that the Secretary’s position was not substantially justified. In the earlier summary-judgment order, the court had found the position stated in the Secretary’s administrative ruling and maintained during the litigation unreasonable. The court also noted that three other district courts had rejected the Secretary’s position. The court therefore held that Zieroth was entitled to attorney fees.
Zieroth also sought an enhanced fee rate based on alleged bad faith. The court explained that bad faith requires knowingly or recklessly presenting a frivolous argument—one that is groundless and has little prospect of success. The court rejected this request. It found that the Secretary’s position was not wholly unsupported because it relied on the Food and Drug Administration’s distinction between continuous glucose monitors approved as replacements for blood-glucose monitors and those approved as supplemental devices. The court also found that the Secretary had not changed positions during the litigation. It therefore found no bad faith.
Amount of the Award
The court applied the cost-of-living-adjusted EAJA hourly rates of $205.25 for work performed in 2019 and $206.77 for work performed in 2020. Zieroth’s counsel claimed 98.45 hours, but the Secretary challenged 2.4 hours spent delivering a chambers copy of pleadings.
The court ruled that delivering court papers was a purely clerical task and reduced the claimed time by 2.4 hours. It calculated the resulting attorney-fee award as $19,838.60. The court also awarded the uncontested $400 filing fee as a taxable cost.
Disposition
The court’s order states that Zieroth’s motion for attorney fees and costs was GRANTED in part and DENIED in part. Zieroth was awarded $19,838.60 in attorney fees and $400 in costs.
Read the full 7-page opinion on CourtListener, the free public archive maintained by the Free Law Project.