CINCINNATI (Legal Newsline) – The federal government had reason to exclude medical reports from doctors involved in a lawyer’s social security scam, a federal court of appeals has ruled even though the attorney’s former clients have been given the chance to prove the reports are accurate.
The U.S. Court of Appeals for the Sixth Circuit on Feb. 3 denied a motion for attorneys fees filed by a group of plaintiffs formerly represented by Kentucky attorney Eric Conn, who was found to have scammed the federal government out of hundreds of millions of dollars by submitting false disability reports for his clients.
Conn has yet to be sentenced for his crimes involving Kentucky and West Virginia claims.
A group of 57 former clients who ultimately had their claims denied because of the scheme are still trying to prove they are entitled to benefits and want to present evidence from four doctors with whom Conn conspired.
The federal government said no, claiming there was “reason to believe” fraud was involved in the creation of the reports. But courts ruled plaintiffs’ due process rights were violated and that they could attempt to show the reports were accurate.
As a result, the plaintiffs moved for their attorneys fees incurred in the fight to be paid for by the federal government under the Equal Justice to Access Act. But the Sixth Circuit said the feds were justified in their initial argument excluding the medical reports.
“(A)s the government points out, this case involved numerous issues of first impression. It was also the first case arising out of Conn’s fraud and the subsequent redetermination hearings to be decided by a court of appeals,” Judge Julia Smith Gibbons wrote.
“Since then, other courts of appeals have agreed with this court’s conclusion that the government’s redetermination procedures were not sufficient, but the government did not have the benefit of any of those decisions when it took its position in this case.
“Given the novelty of both the legal claims and the subject matter, the government had more leeway to construct its arguments.”
Most importantly, Gibbons wrote, the government’s arguments were reasonable.
“Given that the government raised reasonable arguments as to why it had not allowed plaintiffs to challenge the fraud finding, its decision not to allow them to do so was substantially justified.”
Judge Karen Nelson Moore dissented. She said government attorneys are unlikely to ever present arguments without any basis in law or fact but the most recent report on EAJA awards shows federal agencies have given out nearly $60 million in lawyers fees.
“In brief, the government’s litigating position that the redetermination process comported with due process and the (Administrative Procedures Act) was not substantially justified,” Moore wrote.