Opinion
18-CV-06926 (GBD) (VF)
08-22-2022
DIANA BERMEJO, Plaintiff, v. COMMISSIONER OF SOCIAL SECURITY, Defendant.
REPORT AND RECOMMENDATION
VALERIE FIGUEREDO, UNITED STATES MAGISTRATE JUDGE
TO THE HONORABLE GEORGE B. DANIELS, UNITED STATES DISTRICT JUDGE
Plaintiff Diana Bermejo moves for approval of attorney's fees pursuant to 42 U.S.C. § 406(b). For the reasons explained below, I recommend that Bermejo's motion be GRANTED.
BACKGROUND
On June 22, 2015, Bermejo filed applications for Disability Insurance Benefits and Supplemental Security Income. See Administrative Record (“R.”) at 201, 208 (ECF No. 15). Her applications were denied following a hearing held before an Administrative Law Judge (“ALJ”) on September 29, 2017. R. at 7, 10. Bermejo requested review of the ALJ's decision on December 7, 2017, R. at 195-197, and the Appeals Counsel affirmed the ALJ's decision on May 29, 2018, R. at 1-2. On August 1, 2018, Bermejo filed a complaint in this Court seeking review of the Commissioner's decision pursuant to 42 U.S.C. § 405(g). See ECF No. 1. After Bermejo moved for judgment on the pleadings (ECF No. 16), the parties stipulated to remand the matter to the Commissioner on August 19, 2019, for the purpose of conducting further proceedings. See ECF No. 21. The Court entered the parties' joint stipulation on August 26, 2019. ECF No. 22.
On January 9, 2020, the Court approved the parties' joint stipulation for an award of attorney's fees in the amount of $4,500.00 pursuant to the Equal Access to Justice Act (“EAJA”), 28 U.S.C. § 2412. See ECF No. 25. Bermejo's attorney never received payment of the EAJA fee, “presumably due to the fee being applied to a debt owed by [Bermejo] and subject to a lien on the EAJA fee.” ECF No. 27 at 2.
As Bermejo's counsel did not receive the EAJA fees, Bermejo notes that there is no offset required for any award under § 406(b). ECF No. 27 at 7. The Commissioner agrees. ECF No. 30 at 2; cf. Gisbrecht v. Barnhart, 535 U.S. 789, 796 (2002) (explaining that where a fee award is made both under the EAJA and 42 U.S.C. § 406(b), the claimant's attorney must “refun[d] to the claimant the amount of the smaller fee”).
Following remand, the Commissioner found Bermejo disabled and awarded past-due benefits. See ECF No. 27-1, Apps. C, E. The Commissioner withheld 25% of the past-due benefits, amounting to $23,936.75, for payment of Bermejo's attorney's fees. Id., App. E at 4. Bermejo's counsel now seeks to obtain this amount, pursuant to the contingent-fee arrangement with Bermejo, which provided for a contingent fee to counsel of up to 25% of any past-due benefits. See id., App. A. Contemporaneous time records show that Bermejo's attorney, Nathalie Bernadette Martelly, spent 32.05 hours of time in the federal court proceeding. See id., App. F. The Commissioner does not object to the fee request. See ECF No. 30.
The Commissioner contends that Bermejo filed the instant motion outside of the 14-day period permitted by Sinkler v. Comm'r of Soc. Sec., but “defers to the Court regarding [ ] timeliness” of the motion. ECF No. 30 at 2; see Sinkler, 932 F.3d 83, 89 (2d Cir. 2019) (holding that 14-day period for filing motion pursuant to 42 U.S.C. § 406(b) commences upon claimant's receipt of notice of benefits award). However, the Commissioner concedes that Bermejo received the Notice of Award on October 13, 2021. ECF No. 30 at 2. The 14-day period thus did not run until October 27, 2021. The motion for attorney's fees was filed on October 26, 2021, within the 14-day period. The motion was thus timely filed.
DISCUSSION
When a court renders a favorable judgment under 42 U.S.C. § 406(b) to a claimant who was represented by counsel, “the court may determine and allow as part of its judgment a reasonable fee for such representation.” 42 U.S.C. § 406(b)(1)(A). However, that fee may not exceed “25 percent of the total of the past-due benefits to which the claimant is entitled by reason of such judgment[.]” Id. Factors relevant to the request for approval of attorney's fees are: “1) whether the attorney's efforts were particularly successful for the plaintiff, 2) whether there is evidence of the effort expended by the attorney demonstrated through pleadings which were not boilerplate and through arguments which involved both real issues of material fact and required legal research, and finally, 3) whether the case was handled efficiently due to the attorney's experience in handling social security cases.” Blizzard v. Astrue, 496 F.Supp.2d 320, 323 (S.D.N.Y. 2007) (citation omitted).
With regard to contingent fees, the law permits counsel to charge a fee of up to 25% of the past-due benefits so long as the fees are reasonable. Gisbrecht, 535 U.S. at 795. A lodestar method, which considers whether the rate charged and time spent were reasonable, need not be employed if there is no reason to question the terms of the contingent-fee agreement between the lawyer and plaintiff or the character of the representation provided. Id. at 806-08. However, a fee is not automatically recoverable simply because it is equal to or less than 25% of the client's total past-due benefits. Id. at 807. Several factors are relevant to the reasonableness analysis, including: (1) “whether the contingency percentage is within the 25% cap”; (2) “whether there has been fraud or overreaching in making the agreement”; and (3) “whether the requested amount is so large as to be a windfall to the attorney.” Wells v. Sullivan, 907 F.2d 367, 372 (2d Cir. 1990). Also relevant are: (1) “the character of the representation and the results the representative achieved”; (2) “the amount of time counsel spent on the case”; (3) whether “the attorney [was] responsible for any delay”; and (4) “the lawyer's normal hourly billing charge for noncontingent-fee cases.” Gisbrecht, 535 U.S. at 808.
Here, all factors weigh in favor of awarding the fee amount requested by counsel. The fee of $23,936.75 is not more than 25% of past-due benefits and would yield an hourly rate of $746.86 based on the expenditure of 32.05 hours of attorney work spent on Bermejo's social security case. This de facto hourly rate is in line with similar rates approved by courts in this District. See, e.g., Galloway v. Comm'r of Soc. Sec., No. 19-CV-3400 (PAE) (JLC), 2022 WL 1438572, at *3 (S.D.N.Y. May 6, 2022), report and recommendation adopted, 2022 WL 2819626 (S.D.N.Y. July 18, 2022) (approving de facto hourly rate of $750); Ferreira v. Kijakazi, No. 18-CV-1469 (AEK), 2022 WL 123623, at *4 (S.D.N.Y. Jan. 13, 2022) (approving de facto hourly rate of $1,000). Additionally, the hours expended are reasonable given the nature of the services provided and the successful outcome obtained by Bermejo's attorney upon remand. Here, Bermejo's counsel reviewed a voluminous administrative record containing 809 pages; met with Bermejo; drafted the Complaint and motion for judgment on the pleadings; and communicated with the Commissioner regarding the stipulation to remand.
Moreover, in light of the contingent-fee agreement between Bermejo and counsel, the requested fee of $23,936.75 is not so large as to constitute a windfall to counsel. Cases in this circuit have been deferential-accepting de facto hourly rates that exceed those for non-contingent fee cases. See, e.g., Fields v. Kijakazi, 24 F.4th 845, 856 (2d Cir. 2022) (finding the de facto hourly rate of $1,556.98 to be reasonable based on effective representation); Bates v. Berryhill, No. 18-CV-1229 (ER), 2020 WL 728784 at *3 (S.D.N.Y. Feb. 13, 2020) (finding the de facto hourly rate of $1,506.32 was product of competent and efficient advocacy); Baron v. Astrue, 311 F.Supp.3d 633, 637-38 (S.D.N.Y. 2018) (collecting cases with hourly fees approved that ranged from $1,072.17 to $2,100). Further, there is no evidence of fraud or overreaching in the making of the contingent-fee agreement, counsel was not responsible for any delay in this case, and counsel provided effective representation, including obtaining the Commissioner's agreement to remand.
CONCLUSION
For the reasons set forth above, I recommend that Bermejo's application for attorney's fees in the amount of $23,936.75 be GRANTED.
SO ORDERED.
PROCEDURE FOR FILING OBJECTIONS TO THIS REPORT AND RECOMMENDATION
Pursuant to 28 U.S.C. § 636(b)(1) and Rule 72(b) of the Federal Rules of Civil Procedure, the parties have fourteen (14) days (including weekends and holidays) from service of this Report and Recommendation to file any objections. See also Fed. R. Civ. P. 6(a), (b), (d). A party may respond to any objections within 14 days after being served. Any objections and responses shall be filed with the Clerk of the Court. Any request for an extension of time to file objections or responses must be directed to the Honorable George B. Daniels. If a party fails to file timely objections, that party will not be permitted to raise any objections to this Report and Recommendation on appeal. See Thomas v. Arn, 474 U.S. 140 (1985); Wagner & Wagner, LLP v. Atkinson, Haskins, Nellis, Brittingham, Gladd & Carwile, P.C., 596 F.3d 84, 92 (2d Cir. 2010).