[Federal Register Volume 63, Number 52 (Wednesday, March 18, 1998)]
[Rules and Regulations]
[Pages 13115-13116]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-6986]



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  Federal Register / Vol. 63, No. 52 / Wednesday, March 18, 1998 / 
Rules and Regulations  

[[Page 13115]]


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OFFICE OF GOVERNMENT ETHICS

5 CFR Part 2610

RIN 3209-AA20


Amendments to the Office of Government Ethics Rules Under the 
Equal Access to Justice Act

AGENCY: Office of Government Ethics (OGE).

ACTION: Final rule; technical amendments.

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SUMMARY: The Office of Government Ethics is amending its rules under 
the Equal Access to Justice Act on adversary administrative 
adjudicatory proceedings to conform with the revisions enacted as part 
of the Contract with America Advancement Act of 1996, which increased 
the ceiling on attorney and agent fees and added small entities as 
eligible parties to a new category of awards based on covered 
proceedings involving any excessive demands, and is also making a 
couple of minor clarifying and paperwork revisions.

EFFECTIVE DATE: March 18, 1998.

ADDRESSES: Office of Government Ethics, Suite 500, 1201 New York 
Avenue, NW., Washington, DC 20005-3917, Attention: Ms. Grill.

FOR FURTHER INFORMATION CONTACT: Arielle H. Grill, Attorney-Advisor, 
Office of General Counsel and Legal Policy, Office of Government 
Ethics, telephone: 202-208-8000; TDD: 202-208-8025; FAX: 202-208-8037.

SUPPLEMENTARY INFORMATION: The Office of Government Ethics is amending 
its rules at 5 CFR part 2610 for covered adversary administrative 
proceedings under the Equal Access to Justice Act to implement changes 
made to that law in subtitle C of the Small Business Regulatory 
Enforcement Fairness Act of 1996 under the Contract with America 
Advancement Act of 1996, Pub. L. 104-121. One change reflects that, for 
covered proceedings commenced on or after March 29, 1996, the general 
ceiling on attorney and agent fees was raised from $75.00 per hour to 
$125.00 per hour. The section on rulemaking on the maximum fee rate is 
also being revised to include agent fees along with attorney fees. In 
addition, an award is permitted if the demand of the Office for relief 
is substantially in excess of the decision in an adversary adjudication 
and is unreasonable when compared with such decision, under the facts 
and circumstances of the case, unless the party has committed a willful 
violation of law or otherwise acted in bad faith, or special 
circumstances make an award unjust. Furthermore, a small entity as 
defined in 5 U.S.C. 601 is declared to be an eligible party for such 
relief. Finally, an out-of-date citation to a former provision in the 
Paperwork Reduction Act regulations of the Office of Management and 
Budget at 5 CFR part 1320 is being removed.
    In this rulemaking, OGE is implementing these statutory changes as 
to any covered administrative proceedings before it by revising 
Secs. 2610.102, 2610.105, 2610.106, 2610.107, 2610.108, 2610.201 and 
2610.204 of OGE's equal access rules. This is not an executive 
branchwide regulation, as only covered OGE administrative proceedings 
are affected. Moreover, OGE notes that, to date, no administrative 
equal access claims have been filed with it.

Administrative Procedure Act

    Pursuant to 5 U.S.C. 553(b) and (d), as Director of the Office of 
Government Ethics, I find good cause exists for waiving the general 
notice of proposed rulemaking, public comment procedures, and 30-day 
delay in effectiveness as to these revisions. The notice, comment, and 
delayed effective date are being waived because these technical 
amendments to the OGE equal access regulation concern matters of agency 
organization, procedure, and practice. Furthermore, it is in the public 
interest that the new, higher attorney fees provisions and other 
changes as to OGE administrative proceedings covered under the Equal 
Access to Justice Act, as revised, be implemented as soon as possible.

Executive Order 12866

    In promulgating these technical amendments to its equal access 
rules, OGE has adhered to the regulatory philosophy and the applicable 
principles of regulation set forth in section 1 of Executive Order 
12866, Regulatory Planning and Review. These amendments have not been 
reviewed by the Office of Management and Budget under that Executive 
Order, as they are not deemed ``significant'' thereunder.

Regulatory Flexibility Act

    As Director of the Office of Government Ethics, I certify under the 
Regulatory Flexibility Act (5 U.S.C. chapter 6) that this rulemaking 
will not have a significant economic impact on a substantial number of 
small entities because it only affects certain covered OGE 
administrative proceedings and OGE has not to date received any claims 
as to such proceedings under the Equal Access to Justice Act.

Paperwork Reduction Act

    The Paperwork Reduction Act (44 U.S.C. chapter 35) does not apply 
because this technical amendments rulemaking does not contain any 
information collection requirements that require the approval of the 
Office of Management and Budget, since the collections of information 
called for under this rule are expected to involve nine or fewer 
persons each year. Amended Sec. 2610.201(f) of this rule contains a 
statement informing the public of this matter.

List of Subjects in 5 CFR Part 2610

    Administrative practice and procedure, Claims, Conflict of 
interests, Equal access to justice, Government employees.

    Approved: March 12, 1998.
Stephen D. Potts,
Director, Office of Government Ethics.

    For the reasons set forth in the preamble, the Office of Government 
Ethics is amending part 2610 of chapter XVI of 5 CFR as follows:

PART 2610--[AMENDED]

    1. The authority citation for part 2610 continues to read as 
follows:

    Authority: 5 U.S.C. 504(c)(1); 5 U.S.C. App. (Ethics in 
Government Act of 1978).

    2. Section 2610.102 is amended by revising the second sentence and 
adding a new third sentence to read as follows:

[[Page 13116]]

Sec. 2610.102  Purpose.

    * * * An eligible party may receive an award when it prevails over 
the Office, unless the Office's position in the proceeding was 
substantially justified or special circumstances make an award unjust. 
An eligible party may also receive an award when the demand of the 
Office is substantially in excess of the decision in the adversary 
adjudication and is unreasonable when compared with such decision, 
under the facts and circumstances of the case, unless the party has 
committed a willful violation of law or otherwise acted in bad faith or 
special circumstances make an award unjust. * * *
    3. Section 2610.105 is amended by removing the word ``and'' at the 
end of paragraph (b)(4), by removing the word ``any'' at the beginning 
of paragraph (b)(5) and adding in its place the word ``Any,'' by 
removing the period at the end of paragraph (b)(5) and adding in its 
place a semicolon followed by the word ``and,'' and by adding a new 
paragraph (b)(6) to read as follows:


Sec. 2610.105  Eligibility of applicants.

* * * * *
    (b)(6) For purposes of Sec. 2610.106(b), a small entity as defined 
in 5 U.S.C. 601.
* * * * *
    4. Section 2610.106 is amended by redesignating paragraphs (b) and 
(c) as paragraphs (c) and (d), respectively, by revising newly 
redesignated paragraph (d), and by adding a new paragraph (b) to read 
as follows:


Sec. 2610.106  Standards for awards.

* * * * *
    (b) If, in a proceeding arising from an Office action to enforce an 
applicant's compliance with a statutory or regulatory requirement, the 
demand of the Office is substantially in excess of the decision in the 
proceeding and is unreasonable when compared with that decision under 
the facts and circumstances of the case, the applicant shall be awarded 
the fees and other expenses related to defending against the excessive 
demand, unless the applicant has committed a willful violation of law 
or otherwise acted in bad faith or special circumstances make an award 
unjust. The burden of proof that the demand of the Office is 
substantially in excess of the decision and is unreasonable when 
compared with such decision is on the applicant. As used in this 
paragraph, ``demand'' means the express demand of the Office which led 
to the adversary adjudication, but it does not include a recitation by 
the Office of the maximum statutory penalty in the administrative 
complaint, or elsewhere when accompanied by an express demand for a 
lesser amount. Fees and expenses awarded under this paragraph shall be 
paid only as a consequence of appropriations provided in advance.
* * * * *
    (d) An award under this part will be reduced or denied if the 
Office's position was substantially justified in law and fact, if the 
applicant has unduly or unreasonably protracted the proceeding, if the 
applicant has falsified the application (including documentation) or 
net worth exhibit, or if special circumstances make the award unjust.


Sec. 2610.107  [Amended]

    5. Section 2610.107 is amended by removing the dollar amount 
``$75.00'' in the first sentence of paragraph (b) and adding in its 
place the dollar amount ``$125.00.''


Sec. 2610.108  [Amended]

    6. Section 2610.108 is amended by:
    a. Revising the heading to read ``Rulemaking on maximum rate for 
attorney and agent fees.'';
    b. Amending the first sentence of paragraph (a) by adding the words 
``or agents'' between the words ``attorneys'' and ``qualified'' in the 
parentheses, adding the words ``or agent'' between the words 
``attorney'' and ``fees'' outside the parentheses, and by removing the 
dollar amount ``$75.00'' and adding in its place the dollar amount 
``$125.00.''; and
    c. Amending the first sentence of paragraph (b) by adding the words 
``or agent'' between the words ``attorney'' and ``fees''.
    7. Section 2610.201 is amended by removing the last sentence of 
paragraph (f) and by revising paragraph (a) and the introductory text 
of paragraph (b) to read as follows:


Sec. 2610.201  Contents of application.

    (a) An application for an award of fees and expenses under the Act 
shall identify the applicant and the proceeding for which an award is 
sought. Unless the applicant is an individual, the application shall 
further state the number of employees of the applicant and describe 
briefly the type and purpose of its organization or business. The 
application shall also:
    (1) Show that the applicant has prevailed and identify the position 
of the Office in the proceeding that the applicant alleges was not 
substantially justified; or
    (2) Show that the demand by the Office in the proceeding was 
substantially in excess of, and was unreasonable when compared with, 
the decision in the proceeding.
    (b) The application shall also include, for purposes of 
Sec. 2610.106 (a) or (b), a statement that the applicant's net worth 
does not exceed $2,000,000 (for individuals) or $7,000,000 (for all 
other applicants, including their affiliates) or alternatively, for 
purposes of Sec. 2610.106(b) only, a declaration that the applicant is 
a small entity as defined in 5 U.S.C. 601. However, an applicant may 
omit the statement concerning its net worth if:
* * * * *
    8. Section 2610.204 is amended by revising paragraph (a) and the 
first sentence of paragraph (c) to read as follows:


Sec. 2610.204  When an application may be filed.

    (a) An application may be filed whenever the applicant has 
prevailed in the proceeding or in a significant and discrete 
substantive portion of the proceeding. An application may also be filed 
when the demand of the Office is substantially in excess of the 
decision in the proceeding and is unreasonable when compared with such 
decision. In no case may an application be filed later than 30 days 
after the Office of Government Ethics' final disposition of the 
proceeding.
* * * * *
    (c) If review or reconsideration is sought or taken of a decision 
as to which an applicant believes it has prevailed or has been 
subjected to a demand from the Office substantially in excess of the 
decision in the adversary adjudication and unreasonable when compared 
to that decision, proceedings for the award of fees shall be stayed 
pending final disposition of the underlying controversy. * * *

[FR Doc. 98-6986 Filed 3-17-98; 8:45 am]
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