UNITED STATES COURT OF APPEALS FOR THE D.C. CIRCUIT


JACOBS, DANIEL S.

v.

SCHIFFER, LOIS J.


99-5217a

D.C. Cir. 2000


*	*	*


Rogers, Circuit Judge: Having obtained a partial judgment  in his
favor, see Jacobs v. Schiffer, 47 F. Supp. 2d 16 (D.D.C.  1999),
Daniel S. Jacobs appeals the denial of attorney's fees  under the
Equal Access to Justice Act, 28 U.S.C. s 2412  ("EAJA"). Jacobs
contends that the district court misper- ceived the relevant inquiry
under EAJA and that as a matter  of law the government was not
substantially justified in its  position that Jacobs obtain its
advance approval before shar- ing information with his attorney in the
course of obtaining  legal advice about a potential lawsuit against
his employing  agency. We agree, and reverse, remanding the case for
the  district court to determine the amount of attorney's fees to 


I.


The underlying litigation stems from the reaction that  Jacobs, a trial
lawyer in the Environment and Natural Re- sources Division,
Environmental Enforcement Section, of the  United States Department of
Justice, received when he re- ported his "qualms" about the propriety
of certain strategies  and tactics by the Section in cases to which he
was assigned  to his supervisors--ultimately, to Lois J. Schiffer,
Assistant  Attorney General for the Environment and Natural Re-
sources Division of the Department of Justice. See Jacobs,  47 F.
Supp. 2d at 17-18. During the same period Jacobs  reported his qualms,
Jacobs' performance rating was lowered  and he was involuntarily
transferred to a different litigating  group. Id. at 18. Jacobs
consulted a private attorney to  determine "whether the conduct that
he reported within the  [Department] constituted wrongdoing, whether
his supervi- sors improperly retaliated against him, and what public


closures he might lawfully make under the Whistleblower  Protection
Act, 5 U.S.C. s 2302(b)(8)." Id.


Recognizing the potentially sensitive nature of some of the  materials
Jacobs sought to disclose, Jacobs' attorney at the  time, Jonathon
Turley, asked Assistant Attorney General  Schiffer to notify Division
management that he "would have  to review internal memoranda on the
specific litigation that is  the subject of the retaliation claims,"
and that "any confiden- tiality or departmental objections to such a
review be made as  soon as possible so as to expedite this matter."
The Depart- ment's response on behalf of the Assistant Attorney
General  was that the Freedom of Information Act ("FOIA"), 5 U.S.C.  s
552 (1996), controlled, and hence any records that Jacobs  wanted to
disclose to his attorney had to be identified before  the Department
could authorize their disclosure. Citing its  FOIA regulations, 28
C.F.R. s 16 (1996), the Department  advised that Jacobs " 'must
describe the records sought in  sufficient detail to enable Department
personnel to locate the  records with a reasonable amount of effort.'


Jacobs responded through counsel that a whistle-blower  does not make
documents "public" by showing them to his or  her attorney, and that
he was entitled "to seek legal advice  and discuss internal matters
without such discussions being  classified as an unauthorized or
public disclosure." Jacobs  asked whether the Department would
consider certain com- munications by him to his attorney without prior
approval to  violate Department rules, specifically: (1) oral
communica- tions between a whistle-blower and his attorney discussing 
the basis of his claim and the handling of specific cases that  are
material to the whistle-blower complaint; (2) internal  electronic
messages and memoranda from or to supervisors  concerning the
whistle-blower's internal complaints; and (3)  internal electronic
messages and memoranda concerning the  handling of cases that are
material to the whistle-blower  complaint. The Department's position
was that these com- munications were not exempt from the general
restrictions on  the release of non-public information.


Because Jacobs and the Department were at loggerheads  concerning how
Jacobs could obtain legal advice with respect 


to his contemplated lawsuit against the Department, Jacobs  filed suit
against Assistant Attorney General Schiffer in 1997,  seeking
injunctive relief for what he considered to be a denial  of his rights
secured by the First and Fifth Amendments.1  Jacobs' first cause of
action, claiming a First Amendment  right to communicate with his
attorney, was premised largely  on Martin v. Lauer, 686 F.2d 24 (D.C.
Cir. 1982) ("Martin  II"). Jacobs' second cause of action went beyond
Martin II,  alleging that his First Amendment associational interests 
gave him the right to disclose FOIA-exempt information in  the course
of seeking legal advice from his attorney and from  "public interest
and professional organizations committed to  civil rights,
whistle-blower rights, government accountability,  and environmental
enforcement." His third cause of action  alleged an unconstitutional
impairment of attorney-client  communications that impeded his access
to the courts in  violation of the Due Process Clause.


The district court granted summary judgment for Jacobs  on his first
cause of action, ruling that the Department's  "absolute embargo" on
Jacobs' communications with his attor- ney constituted "a prior
restraint ... considerably more  onerous than the one that the D.C.
Circuit found unconstitu- tional in [Martin II]," and thus violated
Jacobs' free speech  rights. Jacobs, 47 F. Supp. 2d at 20, 22, 24.
After reviewing  in camera documents Jacobs proposed to show his
attorney,  the district court found that "it is clear on this record




__________

n 1 Jacobs sought three orders: (1) that the prohibition on unautho-
rized disclosures of non-public information in attorney-client com-
munications, or any requirement of pre-communication review of  such
disclosures, violates the right of freedom of speech under the  First
Amendment; (2) that the prohibitions on such disclosures in 
attorney-client communications, or any requirement of pre-
communication review of the same, violates freedom of association 
under the First Amendment; and (3) that such prohibition or 
requirement violates the right to unimpeded access to the courts 
under the Due Process Clause of the Fifth Amendment. The  prayer for
relief also sought orders enjoining the Department from  enforcing
pre-disclosure restrictions and awarding Jacobs reason- able


Mr. Jacobs could show his attorney some, if not all, of the  documents
that he would like to disclose without violating any  statute or
regulation." Id. The district court likewise reject- ed the
Department's position that a government lawyer,  under D.C. Rules of
Professional Conduct Rule 1.6(a), " 're- veal[s]' his client's
confidences and secrets when he discloses  to his personal
attorney--with the express understanding  that the information should
go no further--only those confi- dences and secrets that the latter
needs in order to advise the  government lawyer of his rights and
obligations as a possible  whistle-blower." Id. at 20-21. The district
court concluded,  therefore, that the Department's restraint "is
broader than  that imposed by law or professional ethics," id. at 21,
and,  relying on Martin II, 686 F.2d at 31-35, the court ruled that 
the restraint violated Jacobs' First Amendment rights. Ja- cobs, 47 F.
Supp. 2d at 24. In the district court's view, to  address the
Department's concerns about the disclosure of  confidential
information, "[a]ll that is required ... is an order  directing Mr.
Jacobs' attorney to keep in confidence, and to  use only for the
purpose of rendering advice to Mr. Jacobs,  any nonpublic information
that his client may impart to him."  Id. at 24.2 While concluding that
Jacobs had no right to  disclose FOIA-exempt information to public
interest groups,  the court found it unnecessary to resolve Jacobs'


Although Jacobs had succeeded on his free speech claim,  the district
court denied Jacobs attorney's fees under EAJA,  explaining only




__________

n 2 The district court also permanently enjoined the Department


from requiring [Jacobs] to notify the [Department] and obtain 
authorization before disclosing to counsel hereinafter identified  any
nonpublic information without which, according to counsel's 
good-faith belief, counsel cannot formulate effective legal advice  to
[Jacobs] regarding matters arising from events giving rise to  this


Jacobs, 47 F. Supp. 2d at 25. The district court's order provided  that
"nothing in this Order shall be read to authorize [Jacobs] or  counsel
to violate any law or rule of professional conduct...." Id.


Mr. Jacobs' prayer for relief generally exempting him  from inhibitions
on the disclosure of nonpublic informa- tion to any sympathetic third
party likely to offer to  advise him represents an extreme to which
the Court has  not found him entitled. In the circumstances the Court 
concludes that [the Department] was substantially justi- fied in
resisting Jacobs' request for carte blanche permis- sion to disclose
without following the rules.


Id. at 24-25. The Department did not appeal the judgment  on Jacobs'
free speech claim, and our review, therefore, is  limited to Jacobs'
contention that the district court erred in  denying him attorney's
fees under EAJA.


II.


Under EAJA, a party is entitled to attorney's fees when (1)  the party
"prevailed" in the underlying litigation by "suc- ceed[ing] on a
significant issue in litigation that achieves some  of the benefits
the party sought in bringing suit," Anthony v.  Sullivan, 962 F.2d
586, 589 (D.C. Cir. 1993), (citing Hensley  v. Eckerhart, 461 U.S.
424, 433 (1983)), and (2) the govern- ment cannot demonstrate
substantial justification for its posi- tion. See, e.g., F.J. Vollmer
Co. v. Magaw, 102 F.3d 591, 594  (D.C. Cir. 1996). The government's
"position" includes both  its pre-litigation and litigation positions,
id., and is "substan- tially justified if it is 'justified in
substance or in the main-- that is, justified to a degree that could
satisfy a reasonable  person. That is no different from ... [having] a
reasonable  basis both in law and fact.' " Id. at 595 (quoting Pierce
v.  Underwood, 487 U.S. 552, 565 (1988)). The government  bears the
burden of demonstrating substantial justification.  Id. The district
court ruled that the Department had met its  burden, and our review of
the district court's denial of  attorney's fees is for abuse of
discretion. See, e.g., Pierce,  487 U.S. at 562-63; Vollmer, 102 F.3d


It is well established that a party "prevails" under EAJA's  first
inquiry even if success is only partial, Farrar v. Hobby,  506 U.S.
103, 111 (1996); Texas State Teachers Ass'n v.  Garland Indep. Sch.
Dist., 489 U.S. 782, 791 (1989), and it is 


undisputed that Jacobs prevailed on his first cause of action:  the
district court ruled that the Department's position requir- ing
preclearance was an "absolute embargo" and an unconsti- tutional prior
restraint. Jacobs, 47 F. Supp. 2d at 20, 24. In  such circumstances,
the district court's task with respect to  the EAJA inquiry was to
determine whether the govern- ment's position with respect to the
issue on which the party  prevailed was substantially justified. See,
e.g., Air Transport  Ass'n. of Canada v. FAA, 156 F.3d 1329, 1332
(D.C. Cir.  1998); Cinciarelli v. Reagan, 729 F.2d 801, 804-05 (D.C.


The district court's terse denial of attorney's fees effective- ly
precluded inquiry into the reasonableness of the Depart- ment's
position with respect to the issue upon which Jacobs  prevailed,
namely his right to disclose information to his  attorney without
first revealing that information to the De- partment for preclearance.
Instead, the district court evalu- ated the Department's position
primarily as a reaction to  Jacobs' broader contentions concerning
public interest groups  on which he did not prevail. The court has
explained that  such a "holistic" approach to the government's
position is  contrary to EAJA, see Air Transport Ass'n of Canada, 156 
F.3d at 1332, and that the relevant "position" of the govern- ment is
that which corresponds to the claim or aspect of the  case on which
the private party prevailed. Thus, even if the  Department was, as the
district court found, justified in  refusing to authorize carte
blanche disclosure of non-public  information to public interest
organizations, the question for  the district court under EAJA was
whether the Department's  preclearance restraint on Jacobs'
communications with his  attorney was reasonable. By lumping together
the Depart- ment's positions on Jacobs' first and second causes of
actions,  involving disclosure to his attorney and public interest
organi- zations, respectively, the district court never addressed that


The district court's failure to make the appropriate inquiry  under
EAJA was an error of law, which, by definition, was an  abuse of
discretion. See Cooter & Gell v. Hartmax Corp., 496  U.S. 384, 405
(1990). Because the question of whether the 


Department's position was substantially justified can be an- swered as
a matter of law, a remand is unnecessary, see, e.g.,  George Hyman
Constr. Co. v. Brooks, 963 F.2d 1532, 1539  (D.C. Cir. 1992); Shaw v.
FBI, 749 F.2d 58, 63 (1984), and we  turn to the critical question
that the district court did not  address.


In view of the district court's judgment on the merits of  Jacobs' free
speech claim, which the government did not  appeal,3 the appropriate
inquiry under EAJA is whether the  Department was substantially
justified in placing on Jacobs'  communications with his attorney a
prior restraint consider- ably more onerous than the one that the
court held unconsti- tutional in Martin II.4 On the undisputed facts,
the answer  can only be "No." The Department has been consistently 
unwilling to recognize that communication of government  information
by a federal government employee to the employ- ee's attorney, where
the attorney is bound to keep such  information confidential, is not a
public disclosure of such  information, and that the employee enjoys
rights under the  First Amendment to engage in such communications in
addi- tion to those the employee enjoys as a member of the general 
public under FOIA. In response to Jacobs' initial request for 




__________

n 3 The Department in its brief to this court takes issue with the 
district court's characterization of the government's position as 
requiring Jacobs to receive advance approval before disclosing 
information to his attorney and as a restriction more severe than 
that at issue in Martin II. This it cannot do; it did not appeal that 
judgment. See, e.g., Trahan v. Brady, 907 F.2d 1215, 1218 (D.C.  Cir.
1990); Trahan v. Reagan, 824 F.2d 96, 103 (D.C. Cir. 1987),  vacated
on other grounds, 866 F.2d 1424 (D.C. Cir. 1988). In any  event, we
find no basis on which to conclude that the district court  clearly
erred in its characterization. See Cooter & Gell, 496 U.S. at  403-05;
Vollmer, 102 F.3d at 596.


4 Subsequently, the court affirmed the district court's judgment  that
even in the absence of specific precedent regarding a federal 
employee's rights to communicate with the employee's attorney, the 
government's position had not been substantially justified under 
EAJA. See Martin v. Lauer, 740 F.2d 36, 45-47 (D.C. Cir. 1984) 


the Department to register its objections to any of Jacobs' 
contemplated disclosures to his attorney, the Department  responded:
"[W]e know of no authority under which the  types of communications
described in your letters are except- ed from the general restrictions
on the release of confidential  information." Jacobs, 47 F. Supp. 2d
at 18 n.2. Once Jacobs  filed his lawsuit, the Department's position
changed only to  refer to additional statutory and regulatory
obstacles to dis- closure,5 but at no point did the Department yield
from its  preclearance position as to the first cause of action on
which  Jacobs ultimately prevailed.


Yet the Department's position--its professed unawareness  of any
authority that might justify Jacobs' contemplated  communications with
his attorney--failed to acknowledge that  the First Amendment,
superior to the statutory and regulato- ry provisions relied upon by
the Department, might provide  such authority. This failure was
inexplicable in light of  Martin II, which was decided more than a
decade earlier. In  Martin II, the Department had required two
employees who  were challenging the legality of a reduction-in-force
to inform  it of what non-public, FOIA-exempt information they had 
revealed to their attorney. 686 F.2d. at 26-27. Noting that a 
balancing test to weigh the First Amendment rights of gov- ernment
employees against the government's interests will  vary according to
the type and context of the speech at issue,  id. at 31 (citing
Pickering v. Bd. of Education, 391 U.S. 563,  568 (1968)), the court


Since the [Department's] memorandum works to restrict  communications
between government employees and 




__________

n 5 The additional statutes and regulations cited by the Department 
included the Privacy Act, 5 U.S.C. s 552a(b) (1996); the Trade 
Secrets Act, 18 U.S.C. s 1905 (1996); an ethics regulation concern-
ing use of non-public information by a government employee, 5  C.F.R.
s 2635.703 (1996); the so-called "Touhy" regulations govern- ing
production or disclosure in federal and state proceedings, 28  C.F.R.
s 16.21-16.29 (1996); and a regulation prohibiting the im- proper use
of official information, 28 C.F.R. s 45.735-10 (1996).  Schiffer also
cited Department Order 2710.8A (1997), regarding  removal and
maintenance of documents.


their attorneys, it implicates the fundamental right of  those
employees to meaningful access to the courts.  Absent grounds to
believe that discussions in this limited  context would significantly
impair any governmental in- terest, we conclude that the ...
memorandum provisions,  as applied to FOIA-exempt information violate
appel- lants' first amendment rights.


Id. at 32.6 Observing that there is a critical distinction  between
disclosures in the attorney-client context and public  disclosures,
id. at 32, 34-35, the court further concluded that  "the government
may protect its interest in prohibiting public  disbursal of any
sensitive information without intruding on  the employee's substantial
interest in freely discussing his  legal rights with his attorney."
Id. at 34. While the govern- ment arguably "could protect its interest
in preventing public  disclosure of government information by
requiring the em- ployee not to authorize any subsequent disclosure of
sensitive  government information by his or her attorney," the court 
stated that a "broad restriction, undermining the confidential- ity of
the attorney-client relationship and chilling discussions  with
counsel in order to protect the government's unclear  interest in
monitoring all discussions of FOIA-exempt infor- mation cuts too
deeply into the employee's first amendment  rights." Id. at 34-35.


It thus has long been clear that the First Amendment does  not provide
a federal employee seeking legal advice regarding  a dispute with the
employing agency with carte blanche  authority to disclose any and all
confidential government  information to the employee's attorney, but
rather that the  scope of the First Amendment right is determined by
balanc-




__________

n 6 In Martin II, the court


emphasize[d], however, that this conclusion pertains only to the 
communications made to the employees' attorneys and not to  any
subsequent use made of those communications. Were the  employees to
reveal the FOIA-exempt information to others, or  to authorize their
attorney to do so, the balance between the  government's interests and
the employees' might well shift.


Id. at 32.


ing the employee's interests in communication with the gov- ernment's
interests in preventing communication. Relevant  to this balancing is
whether the attorney is likely to keep this  information in
confidence, as suggested by willingness to  enter into a protective
order, or whether such communica- tions to the personal attorney will
operate as a de facto public  disclosure. Where, as here, there was no
evidence to suggest  that Jacobs' attorney would publicly disclose the
information  Jacobs sought to communicate, the First Amendment re-
quired a balancing of interests beyond the balance between  disclosure
and non-disclosure under the Freedom of Informa- tion Act.
Understandably, the Department would be con- cerned about giving carte
blanche approval of unlimited dis- closures to one of its attorneys
who has access to a broad  range of potentially sensitive, non-public
information and who  is challenging its management of litigation. But
the reason- ableness of the Department's position with respect to
Jacobs'  free speech claim regarding his attorney must be evaluated in
 light of Martin II. In that regard it is bears noting that in  Martin
II the court observed, albeit in dictum, that in the  whistle-blower
context, where a legal question arises as to  whether a contemplated
public disclosure would be prohibited  by law, "[s]urely, [the
employee] must be allowed to consult  his attorney for an answer to
that question absent some  strong governmental interest in limiting
such communica- tions." Martin II, 686 F.2d at 33 n.41.


Consequently, the Department's position was not substan- tially
justified as a matter of law in light of the Department's  complete
unwillingness to acknowledge that Jacobs had an  interest in
communicating with his attorney on his side of the  First Amendment's
scale. While the district court's judg- ment on the merits is a
separate matter, see Vollmer, 102  F.3d at 595, the gap between where
the district court deter- mined the point of First Amendment
equilibrium to be and  the Department's "absolute embargo" evidences
the Depart- ment's unwillingness to confront the constitutional
implica- tions of its dispute with Jacobs. Instead, prior to the
instant  litigation, the Department stated that it was aware of no 
authority that would have allowed Jacobs to make his contem-


plated communications to his attorney. In the district court,  the
Department continued to claim that it was unable to  assess the scope
of the information that Jacobs contemplated  sharing with his
attorney, even though Jacobs' attorney had  previously indicated to
the Assistant Attorney General that  "the scope of the inquiry
concerns primarily one case and  correspondence with the Section and
yourself on that case."  Although Jacobs' attorney also acknowledged
that more than  one case might be involved in Jacobs' contemplated
whistle- blower claim the Department was not faced with an employee 
engaged in an unbounded fishing expedition. In this court,  the
Department continues to treat Jacobs' disclosures to his  attorney as
disclosures to the public and attempts to distin- guish Martin II by
maintaining, contrary to the district  court's findings by which it is
bound, see supra n.3, that the  Department never required preclearance
of information Ja- cobs sought to share with his attorney, and
further, but  without claiming that the protective order entered by
the  district court is insufficient to address its concerns, that the 
sensitive information to which Jacobs had access was funda- mentally
different from the information at issue in Martin II.  That Jacobs
sought also, in his second cause of action, to  share information with
third parties is irrelevant to the EAJA  issue, for he did not prevail
on that claim, and thus the  Department's continued focus on that part
of his complaint is  misplaced, particularly insofar as prior to
Jacobs' filing suit  the Department's position was directed solely at
Jacobs'  request to share information with his attorney.


Under the circumstances, the Department could not rea- sonably insist
that its interests could be protected only by  preclearing
document-by-document the information Jacobs  sought to share with his
attorney. Even assuming the De- partment could have adopted a position
that would have been  substantially justified short of agreeing to a
protective order,  in light of Martin II and the willingness of Jacobs
and his  attorney to address the Department's concerns that their 
communications not be disclosed to the general public, the  Department
cannot meet its burden to demonstrate that its 


prior restraint on Jacobs' communications with his attorney  was
substantially justified.


Accordingly, we reverse and remand the case for the  district court to
determine the amount of attorney's fees to  award Jacobs.