                                                                            FILED
                           NOT FOR PUBLICATION
                                                                            NOV 09 2017
                    UNITED STATES COURT OF APPEALS                       MOLLY C. DWYER, CLERK
                                                                          U.S. COURT OF APPEALS


                            FOR THE NINTH CIRCUIT


MARRITA TRUJILLO,                                No.   14-35895

              Plaintiff-Appellant,               D.C. No. 3:13-CV-00620-SI

 v.
                                                 MEMORANDUM*
NANCY A. BERRYHILL, Acting
Commissioner Social Security,

              Defendant-Appellee.


                   Appeal from the United States District Court
                            for the District of Oregon
                 Michael H. Simon, District Court Judge, Presiding

                          Submitted November 7, 2017**


Before: THOMAS, Chief Judge, and TROTT and SILVERMAN, Circuit Judges.

      Marrita Trujillo appeals the district court’s order denying her motion for

attorneys’ fees under the Equal Access to Justice Act (“EAJA”) in her action for

judicial review of the Commissioner of Social Security’s denial of her application

      *
             This disposition is not appropriate for publication and is not precedent
except as provided by Ninth Circuit Rule 36-3.
      **
             The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
for disability insurance benefits under Title II of the Social Security Act, which the

district court reversed and remanded for further proceedings. We have jurisdiction

under 28 U.S.C. § 1291 and 42 U.S.C. § 405(g), and we affirm.

       We review the district court’s order denying a motion for attorneys’ fees

under the EAJA for an abuse of discretion. Decker v. Berryhill, 856 F.3d 659, 663

(9th Cir. 2017). A district court “abuses its discretion when it fails to apply the

correct legal rule or its application of the correct legal rule is illogical, implausible

or without support in inferences that may be drawn from the facts in the record.”

Id.

       The EAJA provides that “a court shall award to a prevailing party other than

the United States fees . . . incurred by that party in any civil action . . . brought by

or against the United States . . . unless the court finds that the position of the

United States was substantially justified.” 28 U.S.C. § 2412(d)(1)(A). The

government bears the burden of demonstrating that both its litigation position and

its position in the agency action underlying the litigation were substantially

justified. Decker, 856 F.3d at 664; Gardner v. Berryhill, 856 F.3d 652, 656 (9th

Cir. 2017). Substantial justification means “justified to a degree that could satisfy a

reasonable person,” Gardner, 856 F.3d at 656, and includes situations in which

“reasonable people could differ as to the appropriateness of the contested action,


                                            2
Pierce v. Underwood, 487 U.S. 552, 565 (1988). To be substantially justified, the

government’s position must have a “reasonable basis both in law and in fact.”

Decker, 856 F.3d at 664.

      In ruling on Trujillo’s motion for attorneys’ fees, the district court did not

abuse its discretion in finding the agency decision in this case was substantially

justified. Although Trujillo argues that the DOT’s inclusion of the language “one-

or two-step instructions” in the definition of Reasoning Level One meant the ALJ

was required to find the DOT and the vocational expert’s testimony that Trujillo

could perform Reasoning Level 2 jobs conflicted, that conclusion was not

inevitable. As the district court noted, the DOT reasoning levels do not necessarily

correspond with the functional limitations as defined by the Social Security

Administration, and no binding precedent existed on this issue at the time the ALJ

rendered the decision on Trujillo’s application for benefits. In addition, district

court opinions differing as to whether this phrase is inconsistent with DOT’s Level

Two Reasoning parameters illustrate that the conflict was not necessarily apparent.

Compare, e.g., Murray v. Colvin, No. C-13-01182 DMR, 2014 WL 1396408, at

*10 (N.D. Cal. Apr. 10, 2014) (finding no conflict) with Chase v. Colvin, No.

06:12-cv-01857-HZ, 2013 WL 5567082, at *4-5 (D. Or. Oct. 9, 2013) (finding

conflict exists). Because a reasonable person could have concluded that the ALJ


                                           3
did not err in finding the vocational expert’s testimony and the DOT did not

conflict, the district court did not abuse its discretion when it concluded that the

underlying agency action was substantially justified. See Gardner, 856 F.3d at 656;

Pierce, 487 U.S. at 565.

      The district court also did not abuse its discretion in finding that the

government’s litigation position was substantially justified. Although finding an

agency action was not supported by substantial evidence can serve as a “strong

indication” that the government’s position was not substantially justified, “success

on the merits is not dispositive of an EAJA application.” Decker, 856 F.3d at 664.

Furthermore, the “existence of precedents construing similar statutes or similar

facts” is an important factor in determining whether the government’s litigation

position was substantially justified. Kali v. Bowen, 854 F.2d 329, 332 (9th Cir.

1988) (citing Pierce, 487 U.S. at 566). In this case, in concluding the government’s

litigation position was substantially justified, the district court properly relied upon

the lack of controlling precedent and the inconsistency of district court decisions

concerning whether an RFC limitation to one- or two-step instructions and DOT

Reasoning Level Two conflict. See id.; Decker, 856 F.3d at 665. Because the

district court did not apply the incorrect legal standard or apply the correct standard




                                            4
in an illogical way, the district court did not abuse its discretion. Decker, 856 F.3d

at 663; Kali, 854 F.2d at 334.

      AFFIRMED.




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