4-10.000 - Judgments Against The Government

4-10.010 - Judgment Against the Government—Generally

To prevent difficulties in payment and unnecessary appeals due to the irregularity of form or the inclusion of items of recovery  which are improper, the United States Attorney should arrange to prepare the form of judgment to be entered whenever possible, or, if this is not possible, be sure to review the form of the proposed judgment before its entry. 

Pre-judgment or post-judgment interest against the United States is not allowable, except where the liability to pay interest is imposed by statute or assumed by contract.  28 U.S.C. § 2516(a).  For instance, Title 46 U.S.C § 743, provides for interest in cases brought under the Suits Against Admiralty Act, and the Federal Tort Claims Act provides for post-judgment interest, but does not allow payment of pre-judgment  interest.  28 U.S.C. § 2674.   The award of post judgment interest is governed in district courts by 28 U.S.C.  §§ 1961, 2414, 2516, and 31 U.S.C.  § 1304.  The rate of interest is set forth in 28 U.S.C. § 1961.  Judgments on claims brought against the United States in the Court of Federal Claims bear interest only under a contract or a statute which expressly provides for interest. 28 U.S.C. § 2516(a).   

Court costs payable to the prevailing party may be included in judgments pursuant to Rule 54(d), Federal Rules of Civil Procedure.  Costs and fees taxed against the United States “shall in an amount established by statute, court rule, or order, be limited to reimbursing in whole or in part the prevailing party for the costs incurred by such party in the litigation.  28 U.S.C.  §2411. Other statutes relevant to costs in the district courts include 28 U.S.C. § 1914 (filing and miscellaneous fees); 28 U.S.C. § 1920 (Taxation of costs); 28 U.S.C. § 1921 (United States Marshal’s fees); and 28 U.S.C. § 1923 (attorneys’ docket fees and costs of briefs).

Where no statute specifically allows for the recovery of attorney fees against the United States, sovereign immunity bars the award of fees.   Numerous federal statutes do provide for attorney fee awards where the United States or a federal agency or official is a party.    The most generally applicable statute authorizing attorney’s fee awards against the United States is the Equal Access to Justice Act (EAJA), 28 U.S.C. § 2412.   Generally, the amount of the fee is set by the court.  See Blum v. Stenson, 465 U.S. 886 (1984).  A number of statutes allowing for attorney’s fees provide limits on the fees that may be recovered in an action against the United States.  Those include:  38 U.S.C. § 784(g) (National Service Life Insurance); and 29 U.S.C. § 2678 (Federal Tort Claims Act). 

Except when a judgment is entered by consent in order to provide for the payment of an agreed compromise, all adverse judgments should be brought to the attention of the Civil Division immediately, with the United States Attorney's reasoned recommendation for or against appeal. See JM Title 2, for appeals generally.

[updated April 2018]

4-10.100 - Payment and Satisfaction of Judgment Against the Government

While the Treasury’s Judgment Fund is the usual source for payment of judgments, payment of an adverse judgment may be made in some cases directly by the client agency if it has an appropriation or other source of funds available. Government corporations and "sue and be sued" officials and agencies may have such an appropriation, or a revolving fund, from which payment can be made. While judgments in Federal Tort Claims Act cases, with few exceptions, are paid with Treasury funds, if the FTCA judgment is based upon the activities of a Federally Supported Health Center, the judgment is paid by the Department of Health and Human Services rather than by the Treasury. Likewise, the Postal Service pays judgments for its torts. In a few instances, funds for the payment of a judgment may be provided by an insurer, surety, or indemnitor. Normally, the Civil Division's communication advising that further appellate review will not be sought will provide information as to the method of payment. If payment cannot be obtained from the sources indicated above, payment of final judgments will be made pursuant to 31 U.S.C. § 1304. See JM 4-10.110.

In tort actions, parties in addition to the injured plaintiff may have a legal interest in the funds generated by a judgment or settlement. See United States v. Aetna Casualty & Surety Co., 338 U.S. 366 (1949).  The United States Attorneys should design settlement documents and documents for release of judgment so as to extinguish all claims arising from the subject matter of the lawsuit, including not only the claim of the primary plaintiff but also of all parties having a subrogated or other interest.

[updated April 2018]

4-10.110 - Payment of Judgments by the Department of the Treasury and Postal Service

Final judgments adverse to the United States can sometimes be paid by the client agency, or an insurer, surety, or indemnitor. If payment cannot be effected in that manner, payment can usually be made from the funds appropriated pursuant to 31 U.S.C. § 1304. Thus, judgments (and certain compromise settlements, see JM 4-3.200), payable in accordance with 28 U.S.C. §§ 2414 or 2517, which are final or of which further appellate review will not be sought, may be paid out of the Judgment Fund by the Department of the Treasury, Bureau of the Fiscal Service (BFS) or paid by the Postal Service, as appropriate.  The Judgment Fund is available for court judgments and Justice Department compromise settlements of actual or imminent lawsuits against the government.  

In cases delegated to them by the Civil Division, United States Attorneys should submit adverse final money judgments or compromises that cannot be paid by the client agency, insurer, surety, or indemnitor, to Treasury’s BFS or the Postal Service as appropriate. Note that judgments adverse to the United States are not "final" until the Solicitor General has determined that no further appellate review will be sought. No judgments should be transmitted to the BFS or Postal Service for payment until such a determination has been made. (See JM 2-2.121 et seq.).

In order to facilitate prompt payment of such judgments or compromises, claims should be submitted electronically to BFS via the Judgment Fund Internet Claims System (JFICS). https://www.fiscal.treasury.gov/fsservices/gov/pmt/jdgFund/judgementFund_home.htm.    If JFICS is unavailable, claims may be transmitted by FAX by completing BFS Standard Judgment Fund Transmittal Form 194.  Standard Forms 196 and 197 must also be completed and submitted with the transmittal.  Standardized Judgment Fund Forms are available on the Judgment Fund website at https://www.fiscal.treasury.gov/fsservices/gov/pmt/jdgFund/forms.htm.

The Improper Payment Elimination and Recovery Improvement Act of 2012 and Executive Order 13244, require federal agencies to take additional steps to verify that payments are proper before submitting claims for payment to the Judgment Fund.  USAOs are required to access Treasury’s Do Not Pay Portal (DNP) and run a check of the intended payees against two databases, the Office of Foreign Assets Control’s (OFAC’s) Specially Designated Nationals (SDN) List and the Social Security Administration’s Death Master File (DMF), to assure the intended payees do not appear in either database. See, DNP website: https://www.donotpay.treas.gov/index.htm.  If a payee matches an entry on OFAC’s SDN list, the USAO is required to contact OFAC for further instructions prior to submitting a claim through JFICS.  If the name or Social Security Number (SSN) of a potential payee matches an entry on the DMF, consultation with the payee’s counsel is necessary to determine the individual’s status and that the proper SSN has been provided.

[updated April 2018]