I am pleased to be able to approve H.R. 2378, a bill to extend the Equal Access to Justice Act. I support this important program that helps small businesses and individual citizens right faulty government actions by paying attorneys' fees in court cases or adversarial agency proceedings where the small business or individual citizen has prevailed and where the government action or position in the litigation was not substantially justified. It was with great regret that I vetoed the bill to extend this program that passed at the end of the last session of the Congress. I am pleased that the Congress has corrected the problems I perceived in that bill.
On the important definition of the position of the United States or position of the agency, this bill would allow the court or the agency to look at the agency action that is the basis of the litigation or the agency proceeding, in addition to the position taken by the United States in the court or in the formal agency proceeding, to the extent these differ, in determining whether the position of the United States was substantially justified. I note that the bill strictly limits the court's or the agency's fee inquiry to the agency action that is at issue in the litigation or proceeding and does not permit the examination of any other agency conduct. I note further that the Congress has specifically instructed the courts to base the fee inquiry on the record made in the litigation or agency proceeding for which fees are sought and not to engage in additional discovery or evidentiary proceedings in considering the question of substantial justification. I believe these changes take care of my concerns that the fee proceeding not become another trial and that fee proceedings not involve matters not at issue in the principal litigation. It is with these understandings that I sign this bill.
In addition, it is my understanding in signing this bill that the Congress recognized the important distinction between the substantial justification standard in the fee proceeding and a court's finding on the merits that an agency action was arbitrary and capricious or not supported by substantial evidence. The substantial justification standard is a different standard, and an easier one to meet, than either the arbitrary and capricious or substantial evidence standard. A separate inquiry is required to determine whether, notwithstanding the fact that the Government did not prevail, the Government's position or action was substantially justified. The Equal Access to Justice Act was never intended to create an automatic fee award every time the Government loses a case. The current bill is true to that principle.