No Fees for Truckers Who Beat Hour-Gauge Rule

     CHICAGO (CN) – Three commercial truck drivers cannot recover attorneys’ fees after successfully challenging electronic monitoring of hours logged by companies with consistent safety violations, the 7th Circuit ruled.



     For decades, the Federal Motor Carrier Safety Administration has capped the permissible “hours of service” that drivers can work in a given week. The limits aim “to protect driver health and to ensure highway safety by reducing driver fatigue and thus fatigue-related accidents.”
     Almost all drivers record their hours in paper logbooks, a process plagued by widespread manipulation and falsification.
     A new system scheduled to take effect in June 2012 would have imposed more scrutiny on carriers that exceed the 10 percent rate of noncompliance with hours rules in a single compliance review. Carriers in this category, which have a 40 percent higher crash rate than the general motor-carrier population, would have to install Electronic On-Board Recorders.
     Three commercial truck drivers and the Owner-Operator Independent Drivers Association (OOIDA) petitioned the federal appeals court for review, claiming that the monitors would prevent truckers from using their own discretion to gauge fatigue. Roughly 150,000 drivers who own their rigs belong to the association.
     The 7th Circuit struck down the regulation in September 2011 for failing to address concerns that the devices could be used to harass drivers. The judges said this concern went unaddressed in the rulemaking process, despite explicit direction by Congress.
     “The word ‘harass’ appears only once in the entire rulemaking, in the explanatory ‘legal basis for the rulemaking’ section; otherwise it is not mentioned,” Judge Diane Wood wrote for the Supreme Court. “This explanation is insufficient. … When this standard has not been met, it is necessary to vacate the agency’s action.”
     The truckers’ Fourth Amendment claims were not contemplated on appeal, a decision that will likely allow challenges to any modified regulation.
     Following the favorable ruling, the three individual truck drivers petitioned for an award of attorneys’ fees and costs under the Equal Access to Justice Act, which allows successful litigants to recover fees from successful litigation against the United States under certain circumstances.
     The three drivers each entered into a separate fee arrangement with the same law firm, which also serves as general counsel to the OOIDA. The firm did not charge fees and costs to the individual drivers, sending OOIDA the bill instead.
     The government argued that this fee arrangement made OOIDA alone eligible for reimbursement. OOIDA could not join the fee petition, however, because it is too large to be eligible under the statute.
     Additionally, records submitted in support of the fee award document that the truckers’ attorney, Paul Cullen, met with OOIDA multiple times, but did not meet with the individual drivers.
     “To determine when a fee award is appropriate, the court must bear in mind the purpose of the EAJA,” Wood wrote March 30.
     “The critical concern underlying the common precondition that the fee claimant must have incurred the expense is the need to assure that the employee would not have been deterred from pursuing the suit had the EAJA not existed,” she added. “Financial considerations would not have deterred the individual drivers from pursuing this action, because they are not liable for payment of the attorneys’ fees even if no fees are awarded by this court.”
     The limits of fee awards under the Equal Access to Justice Act (EAJA) have been developed by multiple appellate courts. In another case, the 7th Circuit recently held that an award of fees under the EAJA can include fees incurred by a party’s liability insurance company, because the party had contracted with the insurer to pay premiums in exchange for the bearing of defense costs.
     The 4th Circuit, in contrast, held that employees were not eligible for an EAJA fee award when their employer was legally obligated to indemnify them for their attorneys’ fees. The 8th Circuit also denied fees in a case where a company’s insurance policy reimbursed defense costs of its corporate officer in underlying litigation.
     The individual plaintiffs in the case were William Culligan, Adam Burnett and Douglas Oldham.

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