Opinion
C. A. 1:22-3023-DCN-SVH
01-04-2024
Roger H.,[1]Plaintiff, v. Martin O'Malley, Commissioner of Social Security Administration,[2]Defendant.
ORDER
SHIVA V. HODGES, UNITED STATES MAGISTRATE JUDGE
This matter is before the court on Plaintiff's counsel's motion for fees under 42 U.S.C. § 406(b). [ECF No. 18]. Counsel filed a civil action on behalf of Plaintiff on June 16, 2017. Roger L. H. v. Commissioner of Social Security Administration, C. A. No. 1:17-1572-MBS, ECF No. 1. On November 8, 2018, the Honorable Margaret B. Seymour, Senior United States District Judge, issued an order adopting the report and recommendation, reversing the decision of the Commissioner pursuant to sentence four of 42 U.S.C. § 405(g), and remanding the action for further administrative proceedings. Id. at ECF No. 22. She subsequently issued an order granting Plaintiff's motion for attorney fees under the Equal Access to Justice Act, 28 U.S.C. § 2412 (“EAJA”), and awarding $4,996.40 in attorney fees. Id. at ECF No. 27. Plaintiff filed a second civil action on September 8, 2022. [ECF No. 1] On December 22, 2022, the undersigned issued an order granting the Commissioner's motion to remand for further administrative proceedings and reversing the decision of the Commissioner pursuant to sentence four of 42 U.S.C. § 405(g). [ECF No. 13]. On January 19, 2023, the undersigned granted Plaintiff's motion for attorney fees under the EAJA, and awarded $2,031.50 in attorney fees. [ECF No. 17]. The Commissioner subsequently issued a decision finding Plaintiff disabled under the rules of the Social Security Administration and awarding past-due disability insurance benefit (“DIB”) payments retroactive to May 2015, as reflected in a notice of award dated December 5, 2023. [ECF No. 18-3].
The undersigned was authorized to enter judgment in the case pursuant to the court's standing order, In the Matter of Consensual Dismissal of Actions Before Magistrate Judges, M-90-3-FBH, and in accord with 28 U.S.C. § 636(c).
On December 22, 2023, Plaintiff's counsel requested the court authorize a total fee of $30,000.00 for services rendered to Plaintiff in the district court. [ECF No. 18 at 2]. He attached a signed statement from Plaintiff requesting the court approve the requested fee. [ECF No. 18-5]. The Commissioner filed a response neither supporting nor opposing Plaintiff's counsel's motion, as he “has no direct financial stake in the outcome of this motion.” [ECF No. 19 at 1, 2]. The court has considered counsel's motion for fees under 42 U.S.C. § 406(b) and approves the motion.
The SSA withheld $34,222.00 from Plaintiff's past-due benefits to pay his counsel. [ECF No. 18-3 at 3]. Counsel represents he “is seeking a fee from the Agency for the balance of the withheld benefits from the services rendered representing Mr. H[] before the Agency.” [ECF No. 18 at 2].
I. Consideration of Motion for Attorney Fees Under 42 U.S.C. § 406(b)
When a court renders a favorable judgment to a claimant in a claim brought against the Commissioner, the court may “determine and allow as part of its judgment a reasonable fee” to the claimant's attorney that is “not in excess of 25 percent of the total of the past-due benefits to which the claimant is entitled by reasons of such judgment.” 42 U.S.C. § 406(b)(1)(A). The Supreme Court held in Gisbrecht v. Barnhardt, 535 U.S. 789 (2002), that 42 U.S.C. § 406(b) instructs courts to review contingent fee agreements for reasonableness where the agreed-upon fee does not exceed the statutory ceiling of 25%. Nevertheless, the contingent fee may be reduced from the agreed-upon amount “when (1) the fee is out of line ‘with the character of the representation and the results . . . achieved,' (2) counsel's delay caused past-due benefits to accumulate ‘during the pendency of the case in court,' or (3) past-due benefits ‘are large in comparison to the amount of time counsel spent on the case.'” Mudd v. Barnhardt, 418 F.3d 424, 427 (4th Cir. 2005), citing Gisbrecht at 808.
The record contains a copy of the contingent fee agreement, signed by Plaintiff, which provides:
If the claim is appealed to the Federal Court(s) and a favorable decision is subsequently obtained by either the Court of the Social Security Administration, Claimant agrees to pay Attorney a fee not to exceed twenty-five (25%) percent of the past-due (accrued) benefits including Social Security Disability Benefits and Supplemental Security Income Benefits. Claimant understands that Attorney may seek a fee for his services before the Social Security Administration and a separate fee for his services before the Court, but that fee will not exceed twenty-five (25%) percent of the past-due (accrued) benefits for all services.Tr. at 244. Counsel secured for Plaintiff $136,888.00 in total past-due DIB proceeds.[ECF No. 18-3 at 3]. He requests that the court approve a fee of $30,000.00, which represents less than 25% of Plaintiff's past-due benefits.
Counsel attached a separate notice of award for Supplemental Security Income (“SSI”) dated August 2, 2023. [ECF No. 18-4]. This notice of award reflects “SSI back payments” in the amount of $51,551.57. Id. at 4. Although the SSI notice of award indicates attorney fees will be paid out of that amount, it does not indicate a specific amount withheld for attorney fees. Id. It is unclear from the notices of award whether the SSI benefits were offset by the DIB payments for the same period or vice versa.
Because requested fee does not exceed the statutory ceiling of 25% set forth in Gisbrecht, the court considers only the reasonableness of the fee.
The court concludes that the fee is not out of line with the character of the representation and the results achieved. Counsel represented Plaintiff at the administrative level and before the court, beginning August 25, 2015. [ECF No. 18 at 2]. He obtained for Plaintiff total past-due benefits of at least $136,888.00. [ECF No. 18-3 at 3]. In consideration of the nature of the representation, the period of the representation, and the amount of past-due benefits obtained, the court concludes the fee is not out of line with the character of the representation and the results achieved.
The court further determines counsel did not cause any delays that significantly affected the accumulation of past-due benefits during the pendency of the case in this court. Counsel requested only one extension in the prior case and filed a brief less than 60 days after the Commissioner filed an answer and a copy of the administrative record. See Roger L. H. v. Commissioner of Social Security Administration ECF Nos. 10, 12, 14. He requested no extensions in this case.
The court finds that the requested fee is not large in comparison to the amount of time counsel spent on the case. The record reflects that counsel represented the claimant for 33 hours at the district court level beginning in June 2017. [ECF Nos. 18 at 2]. This represents an effective hourly rate of $909.09. In similar cases, other attorneys have asserted reasonable noncontingent hourly rates to be between $300 and $800. See Cortney S. v. Kijakazi, C. A. No. 1:20-cv-3483-SVH, ECF No. 33 at 5 (D.S.C. June 7, 2023) (stating “[a] reasonable market-based non-contingent hourly rate for these services would be $350-$425 per hour for [an] experienced Social Security disability litigator”); Vincent D. S. v. Kijakazi, C. A. No. 1:21-cv-1561-SVH, ECF No. 26 at 5 (D.S.C. May 30, 2023) (representing counsel's normal hourly rate to be between $500 and $800); Darlene G. v. Kijakazi, C. A. No. 1:20-cv-2619-SVH, ECF No. 37 at 5 (D.S.C. Mar. 29, 2023) (indicating a marketbased hourly rate of $300 to $450). The fee requested by counsel is not significantly out-of-line with the market rate charged by other attorneys in non-contingent cases.
This court has also recognized that attorney fees in contingent cases may reasonably exceed the market rate in similar non-contingent cases. “If the fee approved for [] counsel was limited to the hourly rate an attorney could earn without the risk of a contingency fee . . . ‘plaintiffs may find it difficult to obtain representation.'” Duval v. Colvin, C. A. No. 5:11-577-RMG, 2013 WL 5506081, at *1 (D.S.C. Sept. 30, 2013) (quoting In re Abrams & Abrams, P.A., 605 F.3d 238, 246 (4th Cir. 2010)). Because counsel accepted representation along with the risk of no payment, a resulting fee that exceeds the hourly non-contingent rate is not unreasonable and does not result in a windfall.
The court finds the contingent fee agreement complies with 42 U.S.C. § 406(b)(1)(A) in that it is both reasonable and does not exceed the statutory maximum fee. Therefore, the court grants Plaintiff's counsel's motion for fees under 42 U.S.C. § 406(b), approves a total attorney fee of $30,000.00, and directs the Commissioner to release this amount from the funds withheld from Plaintiff's past-due benefits to pay attorney Evan C. Bramhall.
II. Refund of EAJA Fees
Pursuant to 42 U.S.C. § 406(b)(1)(A), “no other fee may be payable or certified for payment for representation” except for a fee “not in excess of 25 percent of the total of the past due benefits to which the claimant is entitled.” An uncodified 1985 amendment to the EAJA provides for fee awards to be made under both the EAJA and 42 U.S.C. § 406(b), but it provides the claimant's attorney must “refun[d] to the claimant the amount of the smaller fee.” Rice v. Astrue, 609 F.3d 831, 836 (5th Cir. 2010) (quoting Gisbrecht, 535 U.S. at 796). “Because the Social Security Act (SSA) and the Equal Access to Justice Act (EAJA) both allow attorneys to receive fees for successful Social Security representations, Congress enacted a Savings Provision to prevent attorneys from receiving fees twice for the ‘same work' on behalf of a claimant.” Parrish v. Commissioner of Social Sec. Admin., 698 F.3d 1215, 1216-17 (9th Cir. 2012) (citing Pub. L. No. 99-80, § 3, 99 Stat. 183, 186 (1985) (adding “Savings Provision” to 28 U.S.C. § 2412 notes)).
Counsel previously received EAJA fees and agrees they should be refunded to Plaintiff. [ECF No. 18 at 2]. Therefore, the undersigned directs counsel, upon receipt of the $30,000.00 fee approved herein to refund to Plaintiff $7,027.90, representing the EAJA fees paid in this action.
IT IS SO ORDERED.