The United States Court of Appeals for the Federal Circuit recently overruled the Merit Systems Protection Board’s holding that the prevailing party could not recover attorney fees because her attorney was not licensed to practice in the state in which the services were rendered. See Augustine v. Department of Veterans Affairs, No. 04-3162 (Nov. 15, 2005). The Federal Circuit held that the purposes of fee-shifting statutes can be served only by allowing fees for representatives who are licensed as attorneys in any state or federal jurisdiction, without regard to the state licensing requirements of the state in which services were rendered.
Many federal agencies, including the MSPB and EEOC, permit both attorneys and non-attorneys to represent clients in administrative proceedings. Typically, non-attorney representatives are not entitled to an award of fees. Attorneys, however, are entitled to collect fees as part of the relief under most laws federal employees use to raise complaints, including fee-shifting statutes such as Title VII of the Civil Rights Act and statutes governing performance/misconduct-based adverse actions.
In Augustine, the administrative judge (AJ) denied the prevailing party’s fee request. Although her attorney was licensed to practice law in Massachusetts and New York, he was not licensed in California where the services were performed. The AJ held that “although [the attorney] could appear in the proceeding as a nonlawyer representative pursuant to Board regulations,” he could not appear as an attorney unless he was licensed in California. The AJ concluded that, as part of the rules governing attorney conduct in California, a non-member of the California State Bar may not recover compensation for services as an attorney at law in California.
The Federal Circuit overruled that decision, holding that state licensing requirements which purport to regulate private individuals who appear before a federal agency are invalid. The court stated, “It is long established that any state or local law which attempts to impede or control the federal government or its instrumentalities is deemed presumptively invalid under the Supremacy Clause.” The Federal Circuit then turned to the Board’s own regulation, 5 CFR section 1201.31(b), which states that, “[a] party may choose any representative as long as that person is willing and available to serve.” The Federal Circuit concluded that the regulation imposes no requirement that an attorney appearing before the Board be licensed in the state in which the services are rendered.
The Federal Circuit concluded by stating that it would “adversely affect proceedings before federal administrative agencies if state licensing rules were applied, since the pool of available attorney representatives would be severely impaired. In addition to finding an attorney who is accessible and familiar with Board practice, the private party would also have to find an attorney who is licensed in the state in which services are to be rendered.” The Court also commented that the denial of fees to attorneys practicing before federal agencies would, as a practical matter, discourage such representation by attorneys, which is contrary to the Supreme Court’s intent. Thus, the Federal Circuit emphasized not only the importance of obtaining a representative who is familiar with federal administrative agencies, but also the importance of obtaining an attorney representative.
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