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Woman Not Prevailing Party; Not Entitled to Award Despite Temporary Restraining Order

Woman Not Prevailing Party; Not Entitled to Award Despite Temporary Restraining Order

The U.S. Court of Appeals for the Second Circuit Court has reversed a lower court's holding that a plaintiff was entitled to attorneys' fees as the prevailing party in her suit.

Eileen Prendergast was receiving treatment for Amyotrophic Lateral Sclerosis, with health care benefits provided under Medicare insurance policy offered by Aetna Life Insurance Company (“Aetna”). Aetna, determining that Prendergast had stabilized, discontinued the benefits. Prendergast filed for emergency relief in the U.S. District Court for the District of Connecticut against Kathleen Sebelius, Secretary of Health and Human Services (“Secretary”). The court granted a temporary restraining order (“TRO”) to restore the benefits. Resolution of the suit was postponed multiple times and coverage of the benefits was extended until Prendergast's death. Prendergast's daughter, Eileen Mastrio, sought to recover fees and costs. The district court granted the award, holding that the plaintiff was entitled to the award under the Equal Access to Justice Act (“EAJA”) as a prevailing party. The Secretary appealed and on September 17, 2014 the appellate court reversed, concluding that because the suit had not been determined on the merits, the plaintiff was not a prevailing party.

Prendergast filed her suit on July 31, 2008, and on the following day, the district court granted a TRO forbidding the Secretary from denying Prendergast health benefits until August 18, 2008. The court based its decision on the irreparable harm that Prendergast would suffer without the health care and her showing of “sufficiently serious questions going to the merits to make them a fair ground for litigation” rather than “a likelihood of success on the merits.”

Prendergast's coverage was reinstated and after the coverage was extended through September 4, 2008, Prendergast sought a preliminary injunction and sought to extend the TRO on August 22, 2008. Other motions, proceedings and postponements of the suit continued through February 2009, when all motions filed by the parties were withdrawn and the case was dismissed with the understanding that either party could reopen the case. Prendergast's coverage continued through December 14, 2010, the date of her death.

Mastrio subsequently reopened the case after her mother's death. Following a consensual dismissal by the parties, Mastrio filed under the EAJA for attorneys' fees and costs. Consequently, the district court awarded Mastrio $74,245.64 in attorneys' fees and $835.50 in costs – totaling $75,081.14 – but upon a motion by Mastrio to consider Prendergast's attorney's hours worked in 2011 and 2012, the court awarded a total of $78,914.54. Finding Mastrio a prevailing party pursuant to the EAJA, the district court stated that the TRO was granted on the merits of the suit and altered the relationship between the litigants.

The Secretary appealed and the appellate court reversed the district court's judgment and award, pointing out that the district court had not granted the TRO due to – in the district court's own words – “a likelihood of success on the merits.” The appellate court has held that a TRO that “simply preserves the status quo to avoid irreparable harm to the plaintiff is not by itself sufficient to give a plaintiff prevailing party status.” Because the TRO had not been granted on the merits of the plaintiff's suit and it instead reinstated rather than altered the status quo of the plaintiff's health benefits, the plaintiff could not be considered a prevailing party and eligible to recover attorneys' fees and costs. See: Mastrio v. Sebelius, 768 F.3d 116 (2d Cir. Conn. 2014).

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Related legal case

Mastrio v. Sebelius