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AMERICAN ASSN. OF MARRIAGE & FAMILY COUNSELORS

November 7, 1977

AMERICAN ASSOCIATION OF MARRIAGE AND FAMILY COUNSELORS, INC., et al., Plaintiffs
v.
HAROLD BROWN et al., Defendants



The opinion of the court was delivered by: WADDY

 This case is before the Court on plaintiffs' Motion for Attorneys' Fees. Plaintiffs brought this action against the Department of Defense to prevent Government termination of reimbursement benefits to users of certain marriage, family and pastoral counseling services under the Civilian Health and Medical Program of the Uniformed Services (CHAMPUS). *fn1" Plaintiffs in this action are the American Association of Marriage and Family Counselors, Inc. (AAMFC) and eight (8) individuals eligible for CHAMPUS benefits.

 The Court (Richey, J.) earlier granted plaintiffs' Motion for Preliminary Injunction, finding that defendants had failed to properly exercise their discretion, in violation of the Administrative Procedure Act, *fn2" by eliminating coverage for treatment of nervous and mental disorders when such treatment was rendered by civilian marriage, family and pastoral counselors other than psychiatrists, clinical psychologists and psychiatric social workers. Defendants were preliminarily enjoined from ending reimbursement benefits for such services under CHAMPUS. *fn3" Thereafter, the parties reached an amicable resolution of the dispute, and a Consent Decree was entered, in which defendants agreed to continue reimbursement under CHAMPUS for treatment by family, marriage and pastoral counselors under certain specified conditions. *fn4"

 Plaintiffs, including AAMFC, now seek the award of a reasonable attorneys' fee, including $39,934.00 as reimbursement for fees which plaintiff AAMFC has already paid to plaintiffs' counsel, and $768.91 as reimbursement for costs which have similarly been paid by AAMFC. As a portion of the fee award plaintiffs seek reimbursement for 72 hours of attorney time spent on lobbying activities connected with, but prior to the commencement of this litigation. Plaintiffs also move for an incentive bonus award, beyond the expenses actually incurred, claiming such to be appropriate "because of the significant result, which preserved important benefits by its success, the relatively low hourly rate charged, and abilities shown." *fn5"

 I

 There is no specific statutory authority for the award of attorneys' fees in this action. Therefore, plaintiffs are seeking an award under the common benefit or common fund exception to the "American rule" that attorneys' fees are not ordinarily recoverable by the prevailing litigant in federal litigation. Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 247, 257-260, 44 L. Ed. 2d 141, 95 S. Ct. 1612 (1975).

 It is plaintiffs' position that a common fund, as in National Treasury Employees Union v. Nixon, 172 U.S. App. D.C. 217, 521 F.2d 317 (1975), was created or preserved by this lawsuit, and that the beneficiaries of the common benefit, the potential CHAMPUS claimants, should be directed to bear the expense of this litigation. Plaintiffs propose that to satisfy any fee award by the Court, the Government be required to deduct a small sum from each reimbursement check paid on behalf of a beneficiary who has used the services of marriage, family or pastoral counselors; hold those deductions until an amount sufficient to pay the fee award has accumulated; and then pay the collected funds to plaintiff AAMFC and its counsel.

 Plaintiffs argue that their plan escapes the statutory prohibition of 28 U.S.C. § 2412, infra, since the funds collected would have accrued to a CHAMPUS beneficiary, would no longer be Government funds, and would make the United States a mere "stakeholder". See Alyeska, supra, 421 U.S. at 265-268.

 Defendants oppose an award of counsel fees, contending that no distinct common fund was created by this litigation since CHAMPUS reimbursement funds provided in the annual Department of Defense Appropriations Act are retained by the Defense Department until a proper CHAMPUS claim is received and approved. Unexpended funds lapse to the United States Treasury, which, defendants argue, indicates that the United States is the owner rather than mere holder of the funds, creating a section 2412 bar to a fee award.

 Defendants further contend that whatever common benefit may have resulted from this action inured to the AAMFC rather than the CHAMPUS claimants who, by plaintiffs' proposal, would finance this litigation, and over whom, it is asserted, this Court does not have jurisdiction.

 II

 The parties agree, and the Court finds, that plaintiffs have "substantially prevailed" in this action. *fn6" Defendants would have terminated CHAMPUS benefits to users of certain marriage, family and pastoral counseling services but for this lawsuit, and the entry of a Consent Decree does not disturb this finding. See Cuneo v. Rumsfeld, 180 U.S. App. D.C. 184, 553 F.2d 1360 (1977), Grubbs v. Butz, 179 U.S. App. D.C. 18, 548 F.2d 973 (1976).

 Plaintiffs would have this Court direct payment of attorneys' fees from what they perceive to be a common fund under National Treasury Employees Union v. Nixon, 172 U.S. App. D.C. 217, 521 F.2d 317 (1975). The Nixon plaintiffs secured to themselves, and to some 3 1/2 million employees, salary increases which had been illegally withheld. Retroactive salary payments came due plaintiffs and all other beneficiaries of the common fund as a matter of right, with no further application required or contingency attached.

 Here, whatever monies may have been preserved are not absolutely due and owing. CHAMPUS beneficiaries may profit by this litigation only after consultation with a civilian marriage, family or pastoral counselor, and the filing of an ...


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