John F. Cavaciuti v. Denis McDonough, Secretary of Veterans Affairs

United States Court of Appeals
for the Federal Circuit
______________________
JOHN F. CAVACIUTI,
Claimant-Appellant
v.
DENIS MCDONOUGH, SECRETARY OF
VETERANS AFFAIRS,
Respondent-Appellee
______________________
2022-1531
______________________
Appeal from the United States Court of Appeals for
Veterans Claims in No. 20-8063, Judge Coral Wong Pi-
etsch.
______________________
Decided: August 3, 2023
______________________
J OSEPH RAYMOND K OLKER, Orrick, Herrington & Sut-
cliffe LLP, New York, NY, argued for claimant-appellant.
Also represented by MELANIE L. B OSTWICK, K ATHERINE M.
K OPP , Washington, DC; J OHN D. N ILES , Carpenter Char-
tered, Topeka, KS.
I GOR HELMAN, Commercial Litigation Branch, Civil Di-
vision, United States Department of Justice, Washington,
DC, argued for respondent-appellee. Also represented by
BRIAN M. B OYNTON, C LAUDIA B URKE, J OSHUA E. K URLAND,
P ATRICIA M. MC CARTHY ; CHRISTOPHER O. A DELOYE, Y. K EN
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CAVACIUTI v. MCDONOUGH 2
L EE , Office of General Counsel, United States Department
of Veterans Affairs, Washington, DC.
______________________
Before L OURIE, D YK, and T ARANTO, Circuit Judges.
L OURIE, Circuit Judge.
John F. Cavaciuti appeals from a decision of the United
States Court of Appeals for Veterans Claims (“the Veterans
Court”) denying his application for attorney fees and ex-
penses under the Equal Access to Justice Act (“EAJA”).
Cavaciuti v. McDonough, No. 20-8063(E), J.A. 1–5 (Vet.
App. Dec. 30, 2021) (“Decision”). For the reasons detailed
below, we affirm.
BACKGROUND
Cavaciuti served in the United States Army from 1965
to 1967. In February 2020, the Board of Veterans’ Appeals
(“the Board”) granted him entitlement to a total disability
rating due to individual unemployability (“TDIU”). In do-
ing so, it directed the Veterans Affairs (“VA”) regional office
(“RO”) to assign him an effective date for the grant of
TDIU.
In April 2020, notwithstanding the Board’s directive,
the RO denied Cavaciuti’s TDIU claim after determining
that he was capable of gainful employment. Cavaciuti then
filed a petition with the Veterans Court for a writ of man-
damus, seeking an order compelling the VA to implement
the Board’s order and grant him TDIU. The VA then filed
a motion for a stay so that the parties could discuss a mu-
tually agreeable disposition of the case, and the motion was
granted.
Following expiration of the stay, the VA informed the
Veterans Court that the RO had granted Cavaciuti entitle-
ment to TDIU with an effective date of May 22, 2008.
Given that the VA provided Cavaciuti with the relief that
he sought, the VA requested that the court dismiss his
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CAVACIUTI v. MCDONOUGH 3
petition as moot. Cavaciuti argued that the case was not
rendered moot by the RO’s subsequent actions because the
RO had failed to void or otherwise invalidate its erroneous
April 2020 rating decision. He further argued that the VA
misused confidential settlement information in order to
render the case moot. The court then dismissed Cavaciuti’s
petition as moot because the VA had provided him with the
relief that he sought. In March 2021, Cavaciuti filed an
EAJA application seeking attorney fees and expenses.
The Veterans Court denied the application. Implying
that Cavaciuti’s position was in part based on the “catalyst
theory”—positing that a plaintiff is a prevailing party if it
achieves the desired result because its lawsuit brought
about a voluntary change in the defendant’s conduct, it
held that that is an improper basis for establishing a liti-
gant as a prevailing party. See Decision at 3–5 (citing
Buckhannon Bd. & Care Home, Inc. v. W. Va. Dep’t of
Health & Hum. Res., 532 U.S. 598 (2001) (stating that the
catalyst theory would improperly allow an award where
there is no judicially sanctioned change in the legal rela-
tionship of the parties)). Applying this precedent, the Vet-
erans Court held that Cavaciuti did not satisfy that
criterion for prevailing party status, a prerequisite to
awarding EAJA fees. See Decision at 4–5. Specifically, the
court found that its previous dismissal order did not award
benefits, remand any claims, change the parties’ legal rela-
tionship, or otherwise address the merits of Cavaciuti’s
writ petition. Id. It stated that neither its prior order seek-
ing a response, nor the ultimate dismissal of his petition
was a favorable determination on the merits.
The Veterans Court also rejected Cavaciuti’s assertion
that Buckhannon created an exception to the catalyst the-
ory when a defendant orchestrates a case’s dismissal as
moot in an effort to evade judicial review. Id. Instead, the
court found that Buckhannon rejected an analysis of the
defendant’s subjective motivations for changing its conduct
and that petitioners’ theory that defendants orchestrated
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CAVACIUTI v. MCDONOUGH 4
dismissal to evade review was speculative and not based on
empirical evidence. Id.
With respect to Cavaciuti’s allegations that the VA im-
properly used confidential settlement information, the Vet-
erans Court held that the VA simply implemented the
Board’s decision as requested by Cavaciuti in his petition.
The court added that the record did not suggest that the
government acted inappropriately.
Cavaciuti then filed the present notice of appeal to this
court. We have jurisdiction under 38 U.S.C. § 7292.
D ISCUSSION
Our jurisdiction to review decisions of the Veterans
Court is limited. We may review the validity of a decision
with respect to a rule of law or interpretation of a statute
or regulation that was relied upon by the Veterans Court
in making its decision. 38 U.S.C. § 7292(a). However, ex-
cept with respect to constitutional issues, we may not re-
view challenges to factual determinations or challenges to
the application of a law or regulation to the facts of a case.
Id. § 7292(d)(2).
In reviewing a Veterans Court decision, we decide “all
relevant questions of law, including interpreting constitu-
tional and statutory provisions,” and set aside any inter-
pretation thereof “other than a determination as to a
factual matter” relied upon by the Veterans Court that we
find to be “(A) arbitrary, capricious, an abuse of discretion,
or otherwise not in accordance with law; (B) contrary to
constitutional right, power, privilege, or immunity; (C) in
excess of statutory jurisdiction, authority, limitations, or in
violation of a statutory right; or (D) without observance of
procedure required by law.” Id. § 7292(d)(1). We review
questions of statutory and regulatory interpretation de
novo. Mayfield v. Nicholson, 499 F.3d 1317, 1321 (Fed. Cir.
2007) (citing Prenzler v. Derwinski, 928 F.2d 392, 393 (Fed.
Cir. 1991)).
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CAVACIUTI v. MCDONOUGH 5
Although we may review the Veterans Court’s inter-
pretation of the EAJA de novo, we cannot review the court’s
application of the EAJA to the facts of a case. Thompson v.
Shinseki, 682 F.3d 1377, 1380 (Fed. Cir. 2012). The EAJA
applicant “carries the burden of proving he is a prevailing
party.” Robinson v. O’Rourke, 891 F.3d 976, 980 (Fed. Cir.
2018).
Cavaciuti argues that the Veterans Court erred in not
considering whether or not the terms of his relief were in-
corporated into the court’s previous dismissal order. He
adds that the court also erred in not considering whether
or not the VA made an admission of liability, or if its
change in conduct was voluntary. Cavaciuti further argues
that the court’s dismissal order materially changed the
parties’ legal relationship by requiring the government to
provide Cavaciuti relief. That material change, and the
fact that the VA’s change in conduct was not voluntary, he
asserts, distinguishes this case from one falling within the
rejected catalyst theory.
The government responds that the Veterans Court’s
dismissal order did not amount to a court-ordered change
in the parties’ legal relationship that conferred prevailing
party status. Instead, the government contends, this ap-
peal relies on the catalyst theory, which “aptly describes
Mr. Cavaciuti’s claim in this case,” but that does not convey
prevailing party status. See Appellee’s Br. at 12. The gov-
ernment adds that we have previously held that a party is
not eligible for an award of attorney fees when a case is
dismissed as moot. Vaughn v. Principi, 336 F.3d 1351,
1357 (Fed. Cir. 2003).
Cavaciuti also contends that the Veterans Court erred
in holding that the government did not improperly use set-
tlement information. He argues that it did use settlement
information and that permitting agencies to use settlement
communications to render actions moot discourages settle-
ment and is contrary to the aims of the EAJA.
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CAVACIUTI v. MCDONOUGH 6
The government asserts that public officials are pre-
sumed to act in good faith and that Cavaciuti has provided
no proof in support of his improper use allegation. We
agree with the government in all respects.
Entitlement to fees under the EAJA requires, inter
alia, that a party be a prevailing party. The Veterans
Court properly denied Cavaciuti’s application for attorney
fees and expenses under the EAJA because he was not a
prevailing party. Prevailing party status requires the “ul-
timate receipt of a benefit that was sought in bringing the
litigation, i.e., the award of a benefit, or, at minimum, a
court remand predicated upon administrative error.”
Sumner v. Principi, 15 Vet. App. 256, 264 (2001), aff’d sub
nom. Vaughn, 336 F.3d at 1353. Crucially for the present
case, an award of a benefit by the agency alone, even if
prompted by the litigation, is insufficient without a judicial
imprimatur. The Supreme Court has held that the catalyst
theory is an improper basis for establishing an appellant
as a prevailing party under the EAJA in the absence of a
judicially sanctioned change in the legal relationship of the
parties. See Buckhannon, 532 U.S. at 601; see also Vaughn,
336 F.3d at 1357.
Here, there was no such judicial change in the legal re-
lationship between the parties. The Veterans Court did not
award any benefits or remand any claims because of Cava-
ciuti’s writ of mandamus petition. Rather, the court dis-
missed the petition as moot because the VA voluntarily
changed its position and granted Cavaciuti entitlement to
TDIU. The court’s dismissal order did not evaluate the
merits of Cavaciuti’s petition, nor did it materially alter the
parties’ legal relationship. See Buckhannon, 532 U.S. at
605 (“A defendant’s voluntary change in conduct, although
perhaps accomplishing what the plaintiff sought to achieve
by the lawsuit, lacks the necessary judicial imprimatur on
the change. Our precedents thus counsel against holding
that the term ‘prevailing party’ authorizes an award of
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CAVACIUTI v. MCDONOUGH 7
attorney’s fees without corresponding alteration in the le-
gal relationship of the parties.”).
Regarding Cavaciuti’s argument concerning the lack of
voluntariness of the government’s change in conduct, this
is just another way of stating the catalyst theory rejected
by the Supreme Court. The Court held in Buckhannon that
an analysis of a defendant’s subjective motivations for
changing its conduct—in particular, the desire to avoid a
litigation loss—was legally insufficient to create prevail-
ing-party status. The Court instead required a judicial ac-
tion changing the legal relations of the parties. In this
case, the VA implemented the Board’s TDIU decision, as
requested by Cavaciuti following settlement discussions
rather than based on any court order. Moreover, the fact
that the government’s representations about the nature of
the relief it was providing would estop it in the future from
changing course does not render the Veterans Court’s dis-
missal a judicial imprimatur sufficient to make Cavaciuti
the prevailing party. The government’s conduct merely
created a future opportunity for a judicial order if the gov-
ernment did not live up to its representations. The Veter-
ans Court ultimately committed no legal error in invoking
the Buckhannon legal rule for the determination of prevail-
ing-party status here.
Lastly, regarding the claim of improper use of settle-
ment information, Cavaciuti seems to be suggesting that
the Buckhannon rule is, as a matter of law, inapplicable if
the defendant’s voluntary action resulted from settlement
discussions. But the rationale of Buckhannon is keyed to
the need for judicial action changing the parties’ legal rela-
tions; the Supreme Court rejected a catalyst theory as in-
sufficient without regard to the mechanism by which the
litigation catalyzed the defendant’s action—whether by
settlement discussions or otherwise. And here, in any
event, there is nothing in the record suggesting that the VA
acted inappropriately. Cavaciuti does not specify confiden-
tial settlement information that was allegedly misused.
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CAVACIUTI v. MCDONOUGH 8
We therefore hold that the Veterans Court properly re-
jected Cavaciuti’s claim that the government improperly
used settlement information.
CONCLUSION
We have considered Cavaciuti’s remaining arguments,
but we find them unpersuasive. For the foregoing reasons,
we affirm the Veterans Court’s decision denying Cava-
ciuti’s application for attorney fees and expenses under the
EAJA.
AFFIRMED
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